http://www.aph.gov.au/hansard/senate/commttee/S9515.pdfSir Black Blade, it is true, your oil analysis has been excellent and I regret that I did not devote more capital to that game. I apologize that my tone was too shrill or seemed too off topic. There are certain issues pertaining to energy that I believe are worth answering, but they can wait. At the least, I suspect we both agree that the "solutions" being publicly discussed provide no substitute for an 80 MBPD transport fuel habit: (ethanol, biodiesel, etc).

Sir Phil288, the Bakhtiari testimony touched on everything that is so ignored regarding Peak oil, it was well worth reading the whole 40 odd pages (link) and illustrated many of the future gold-oil transformations that FOA spoke of. I was floored by his candor, especially regarding the "non-economic" projects like the Airbus, the rail lines or the natural gas pipelines that will never be built because events will overtake the plans. To date I can not think of anyone who has had the audacity to say such things. Especially incisive were his comments regarding the energy costs of producing energy- it highlights the real absurdity regarding mining shares versus physical metal whose energy costs are already "paid up". Just imagine producing gold by hand from 0.5-2gm/ton ores.

Sir Invisible Hand, your comments I concur with, but I did not intend to suggest that Europe was superior to Islamic learning, nor to say who is the victim nor who the transgressor. I merely point out that once the Dollar is done, and the US demoted, then Europe will have to manage on its own. And given that, perhaps the dollar and the US are still useful for "dirty work" for a while longer. I too have my hopes that the EU becomes a showcase of Liberty and not Imperialism by Committee.

We sit on the edge of ruin, but I rather than dwell on apocalyptic drivel, let me but note that Bakhtiari did not provide any solutions, merely suggestions to ease the pain. I have a pallative of another color: clink clink clink...

Yes, Sir Sundeck: When we have reported GDP in the past quarter up by 2.5% (aprox.) and (official unreliable) CPI inflation data for the quarter reported at 4+ %, we think you are correct in attributing any apparent economic growth, to increasing costs.

That old vampire sucks the life from the economy...Rising costs, declining business activity, shrinking margins, falling profits. The Stagflation vampire, once Volkerized, is now awakened in the dark piles of fiat heaped upon it.

No one is bragging up the business: Those numbers only exist somewhere else, in the monopoly of Government, economies of scale, or accounting jargon. Here in the world, the sacrificed half case of beer only buys one, 50 miles of gasoline rather than the former 200 miles. Multiply it many times, add pop, groceries--do the math; we need to go the distance, whatever the cost in other discretionary sales. The beer truck now costs that company more to deliver less margin. Same on down the line. Soon, something gives way: we don't need the bodies or a truck, maybe we don't need the stops or frequencies. Maybe, the declining business, margins, and no profit, kills the companies.

Think the gasoline retailers are happy? Think they're cutting the fat hog? Think again.
Gasoline on the card, costs the retailer say, 4 cents on the dollar--fees. At a dollar a gallon that was 4 cents. Gasoline went to $2.00, now the card costs were 8 cents a gallon. Gasoline goes to $3.00 a gallon, now the bank charges are 12 cents a gallon. The retailer calls to order more gas. Sorry...the reply. "You haven't paid the last load." The banks with their cards have been cutting the fat hog! Their fees off the top drain more money than the retailer has in margin to stay competitive. Doors closed...Out of Business!

There are always such challenges in mining, Sir Druid. But why stick to gold. I'm certain that silver, copper, and lead mining are equally messy, and have the same sustainability issues. Are we certain that this is not a subtle form of gold bashing? Or that someone in Chile wants the orebody for a domestic outfit? (I am not questioning the claims of the locals, but rather, of the motives of the news media in pushing this particular story all the way to your local TV set.)

Barrick certainly deserves some bashing, too bad it isn't their management who is being bashed.

The moral compass is tricky. Gold is recycleable though.

http://www.catholic.org/international/international_story.php?id=20713GOLD FINGER,

You object to my reference in msg#: 146279 to the Pope.
But you do not object to my reference in msg#: 146280 to a senator of the US of A.
Why the double standards?
Who has more moral authority?

I think there was a discussion this week-end, discussion which was deleted by our hosts before I could read it, about republocrats and demopublicans.

If you accept that there is such a thing as morality, the FIRST question is, according to Ayn Rand, Does man need values at all -- and WHY?
The first question is NOT: WHAT particular code of values should man accept?
Rand goes on to define morality as an objective, metaphysical necessity of man's survival.
Man's survival.
Not the survival of the US of A or of its dollar.

NEXT: WHAT particular code of values should man accept?
Man must choose his actions, values and goals by the standard of that which is proper to man, says Rand.

http://www.catholic.org/international/international_story.php?id=20713
The [Pope] also reiterated his request to "open humanitarian corridors and to respect the LIFE OF EACH AND EVERY PERSON, which is a gift from God."

Right, Rand does not accept the existence of God.
But show me besides the Pope, one public person of �importance' who defends man and his life?

In his 1993 Aquinas Lecture, "Person and Being", delivered at Marquette University, Father Clarke, S.J.argues that:

A HUMAN PERSON is a personal being possessing its intellectual nature
as joined in a natural unity in a material body

Aristotle - rational animal
Thomas Aquinas - embodied spirit

(W. Norris Clarke, S.J., "Person and Being", reprinted in Rainier R.A. Ibana, (ed.), "Person, Being and Ecology", Ateneo de Manila University Press, 1996, p. 23)


To compensate for my reference to a Jesuit, here's Murray N. Rothbard "For a New Liberty -- The Liberterian Manifesto", New York: Libertarian Review Foundation, 1978, rev. ed., p. 23:

THE NONAGRESSION AXIOM
The libertarian creed rests upon one central axiom: that no man or group of men may aggress against the person or property of anyone else> This may be called the "nonaggression axiom".
"Aggression" is defined as the initiation of the use or threat of physical violence against the PERSON or property of anyone.

Rothbard agrees with the Jesuit. Inch'Allah!

1. Respect yourself and your better judgment. If you do not take the responsibility for keeping this Forum from spinning into chaos, no one will.


2. Respect your fellow poster. If you do not, he/she has no choice but to defend his or her online persona. That leads to psychological warfare which neither party can win. Learn to back away to carry on another day.


3. Respect this table. Sturdy and oaken as it is, it is fragile as well. If you damage it, you damage yourself.


4. Respect those who provide this forum. If USAGOLD / CPM is diminished by the existence of this Forum, it has no reason to provide it.


5. Respect those who read this Forum as lurkers. Remember it is not USAGOLD / Centennial Precious Metals that provides sustenance for this table but its clientele.


6. Respect the rules. Remember, without law and mutual respect -- the rules -- we are rabble.


7. Respect the purpose of this forum. It is not to promote your enterprise; a favorite enterprise (including our competitors); investments in stocks, bonds, and derivatives; a political party or group; religious group; or your own career. Remember you are a guest here.


8. Respect the civility and integrity of the Table. I should not have to police this site. Take personal responsibility, and a pleasant place to visit will be your reward.


9. Respect the rules of civil discourse. Do not in a fit of anger, pique or disgust hit the "Submit Message" button. You will more than likely come to regret it. Give it a day. Give it a week. We'll all be here when you get back.


10. Respect the continuity of the Internet. Once it's posted here. It's posted here for the long haul.


11. Respect the spirit of this message born of considerable experience. It is not addressed to any one individual or any group. It is directed toward and applies to all. Please appreciate when USAGOLD issues a posting code, it is a matter of trust.


�
Sincerely, Michael J. Kosares,
USAGOLD / Centennial Precious Metals, Inc.

Ref admin msg#: 146287

Mmmm...that is not badly constructed...someone put some thought into those eleven guidelines...based upon a little experience, as well...

...and good instruction to carry elsewhere, in one's wanderings and dealings, as well.

Thank you, Sir MK.

:-)

http://www.fnarena.com/index2.cfm?type=dsp_newsitem&n=C810C7B8-17A4-1130-F504DBCC205BC08BSee link for some discussion on this interesting question...discusses the recent drop in price by 22% from over $700 per ounce...

:-)

http://www.idexonline.com/Snip:

"...
Million Dollar Deep Sea Fishing Lure, No Big Fish Tale!

(July 31, '06, 11:21 Joseph V. Kuca, New York)

MacDaddy's Fishing Lures, manufacturers of what you might say is 'not your daddy's fishing tackle,' has just unveiled its newest creation -- a one million dollar, limited edition, deep sea fishing lure.



The latest in MacDaddy's daring line of fishing tackle, the Million Dollar Lure was designed by company founder, fishing enthusiast, and 28-year veteran jewelry designer Mac McBurney. The limited edition piece is manufactured by Uneek Fine Jewelry Collection and is restricted to a numbered production quantity of 25 pieces worldwide.
..."

Sundeck: Come on all you game fisher-folk! You haven't lived until you've cast one of these over the stern and started winding...somehow I don't think the fish would notice all that much...

:-0

@Goldendome #146284

Dang it, Sir Goldendome, now you have made me feel guilty everytime I call in to the gas station to fill up. I nearly always use credit card (pay off monthly, get bonus points for travel etc, plus one month interest-free on funds). In future I will always be thinking of the owner's declining margins.

Actually, there are moves afoot in Australia for petrol station owners to pass on bank/credit charges, from credit card purchases, to the motorist...I'm afraid the free lunch is about to come to an end...

:-(

http://www.marketwatch.com/news/story/Story.aspx?guid=%7BEB1271B8%2D89CC%2D4002%2D9369%2DDCA5D2945087%7D&siteid=snip:

WASHINGTON (MarketWatch) -- U.S. core consumer inflation matched an 11-year high in June, keeping the pressure on the Federal Reserve to fight inflation, the Commerce Department reported Tuesday.

The core personal consumption expenditure price index, excluding food and energy, increased 0.2% for the third straight month in June, and has risen 2.4% in the past 12 months, matching the largest year-over-year gain since April 1995's 2.5% increase.

The core rate had also risen by 2.4% on a year-over-year basis in September 2002 and in May 1995.

Consumer prices including food and energy also rose 0.2% in June, and are up 3.5% in the past year.

Meanwhile, personal incomes rose 0.6% in June, outpacing the 0.4% increase in consumer spending. Read the full government report.

The personal savings rate rose to negative 1.5% from negative 1.6%, the 15th consecutive month of negative savings. Consumers can have negative savings by spending previous savings, or by borrowing or selling assets to support their consumption.

After adjusting for inflation, real consumer spending rose 0.2% in June, the fourth straight month of tepid spending. Factoring out taxes and inflation, real take-home pay rose 0.4%, the biggest increase in disposable income since December.

Real per capita disposable incomes rose 0.3%.

The gains in nominal monthly incomes, spending and inflation were exactly as expected by Wall Street economists surveyed by MarketWatch. See Economic Calendar.

The inflation figures continue to trouble Fed policymakers, who have said core prices are rising faster than they'd like. The Fed has raised interest rates 17 times in the past two years. Much of the impact of those rate hikes has yet to be felt, Fed officials have said.

The evident slowdown in economic growth, largely due to a weaker housing market and high energy prices, should also remove inflationary pressures over time, officials have said.
Markets are expecting the Fed to stand pat in August to reassess monetary policy. Two Fed officials said Monday that the decision about whether to raise rates again would be a close call, and would depend in part on incoming data on growth and inflation. See full story.

Looking to July

The July jobs report is likely to have the greatest influence on Fed thinking. See full story.

Core inflation will likely accelerate to 2.5% in July, said Stephen Stanley, chief economist for RBS Greenwich Capital.

"This is why we think that the Fed has to tighten again next week. Pure and simple. Core inflation is too high and still accelerating," Stanley said.

"It is very risky for the Fed to stop hiking when inflation is still accelerating."
The June data on incomes, spending and inflation provided monthly details to the quarterly figures released last Friday in the report on gross domestic product. That report showed core consumer inflation had risen 2.3% from the second quarter of 2005 to the second quarter of 2006. See full story.

Incomes got a boost in June from higher hourly wages. Nominal compensation of employees increased 0.6% in June, with wages also up 0.6%.

Income from assets rose 1.5% in June, the third straight gain over 1%.

Proprietors' income increased 0.1%.

Nominal disposable per capita income rose 0.5% to $31,705.

"By now, it is evident that consumer spending is showing the strains of elevated gasoline prices and a slowing housing market, while for debt-laden consumers higher interest rates have increased the burden of monthly debt service payments," said Stu Hoffman, chief economist for PNC. "With little relief from any of these factors likely in the near term, consumers are becoming increasingly reliant on wage growth to support spending."

Real spending on durable goods rose 0.5%, the first gain in three months.

Real spending on nondurable goods increased 0.3% and real spending on services increased 0.1%, the weakest gain since January.

"With after-tax real incomes up only 0.4% year over year, and the housing correction making equity extraction rather less attractive, spending growth is likely to slow further," said Ian Shepherdson, chief U.S. economist for High Frequency Economics.

Goldilox

It's getting harder and harder to hide the inflafla in "hedonic adjustments". While personal savings improved, it was not by much. Americans are still "eating their homes" at a 1.5% per month rate.

http://www.youtube.com/watch?v=3u2qRXb4xCU

http://www.youtube.com/watch?v=3u2qRXb4xCUGood Satire and put speakers on

http://news.bbc.co.uk/2/hi/business/5233664.stmsnip:

roubled Russian oil firm Yukos has been declared bankrupt by a court in Moscow, clearing the way for the firm to be liquidated.
The decision ends a three-year court battle for survival, after Yukos was hit with a huge back tax bill.

The saga has seen former Yukos chief Mikhail Khodorkovsky jailed and parts of the oil firm's empire sold off.

"It's the death sentence for the company," Yukos lawyer Drew Holliner said after the ruling.

Arbitration Court judge Pavel Markov's decision came as "little surprise", Mr Holliner said, given that Russian tax authorities and state-owned oil firm Rosneft are the group's biggest creditors.

-Goldilox

Not much of a surpirse, as Putin continues to "divest" the foreign beholden oligarchs and Wall St. interests of Russian resources.

Oil up, gold up :dollar down, DJIA down. Meanwhile Tony (the poddle as he is called in the English press) cuts a deal on global warming and stem cells with Arnold, and the EU passes a cease fire proposal.

http://www.usagold.com/DailyQuotes.html
The Daily Gold Market Report has beenupdated.

If you are considering investments in gold we invite you to request our freeintroductory information packet detailing the products and services offeredby USAGOLD ~ Centennial Precious Metals. We welcome your inquiry and lookforward to working with you.

TUESDAY Market Excerpts

Gold exits doldrums, begins August up $12

August 1 (from DowJones) -- After trading quietly for the early part of the session Tuesday, Comex gold futures rushed to a two-week high as the dollar slipped lower and crude oil breached the $75-a-barrel mark at the New York Mercantile Exchange. Most-active December gold settled $12 higher at $658.80.

During the session the contract broke to a high of $659.30 an ounce after traders returned to the floor at Nymex following a 30-minute fire drill. After trading resumed, Jim Quinn, a commodity floor analyst at AG Edwards, said the dollar had lost ground and prompted a strong round of buying in gold.

He added that the growing tension between Israel and Hezbollah added to the upside. "There was a rejection of a proposal (by the U.K. and Germany calling for a cease fire in the Middle East) and more (Israeli) troops have moved into Lebanon," said Quinn.

Other traders said it is difficult to predict near-term moves in gold, given the thin market conditions. However, many believe that any price dip is a buying opportunity as the next couple of months should prove good for gold as it should manage to register new highs for the year.


(MarketWatch) -- On the data front, the Commerce Department said core U.S. consumer inflation matched an 11-year high in June -- the core personal consumption expenditure price index, adjusted to exclude food and energy, increased 0.2% for the third straight month in June, and it's risen 2.4% in the past 12 months, matching the largest year-over-year gain since April 1995. Consumer prices including food and energy also rose 0.2% in June, and are up 3.5% in the past year.

---(see url for full news, 24-hr newswire)---

http://www.gulfnews.com/nation/Society/10056780.htmlDubai: A number of residents have discovered that a Philippine peso is as good as a dirham whether it is to buy a soft drink or a parking ticket.

One of the reasons attributed for pesos working in vending machines is that their weight and size is more or less the same as a dirham.

...a dirham is about 13 pesos.

A few people are beating the system using a simple trick. When they are thirsty or need a parking ticket they slip a peso coin into a vending machine. The machine obliges because the size of a peso coin is the same as a one dirham coin. That works out as 13 sodas for the equivalent of one dirham.

^---(from url)---^

A useful article to foster some additional personal ponderings upon the nature of money and currency.

R.

http://www.gulf-daily-news.com/Story.asp?Article=151291&Sn=BUSI&IssueID=29135NEW YORK: Newly minted US Treasury Secretary Henry Paulson said yesterday in his first public comments since assuming office last month that a "strong dollar" is in the US' best interests.

Paulson picked up the baton right where his predecessor left off in stating his adherence to a strong dollar in a speech at New York's Columbia University.

"I believe that a strong dollar is in our nation's interest and that currency values should be determined in open and competitive markets in response to underlying economic fundamentals," Paulson said.

Paulson also echoed former treasury secretary John Snow and senior US lawmakers in criticising the Chinese government's currency regime... "The Chinese need to show more flexibility with their currency," Paulson said.

^---(from url)---^

"Meet the new boss. Same as the old boss."
[chorus]
"We won't get fooled again!"

R.

Dear Gold Bugs,

The world is a dangerous place. We live in perilous times where freedoms are being challenged daily. All one has to do is look out side your own door to see the troubles and dangers. A few days ago, right in my neighborhood a woman was shot to death by what the authorities claim is part of the serial killings of an individual or individuals.

Negative and evil doing is every where. The news media and local government called a town meeting at a school that is next to me. Answers, is what everyone demanded. Why? and How could this happen in our town?

Like all the many fine articles and comments on our ever changing country, political and investment arena point out, we are defiantly in for some hard times.

I do think people's personal economic situation is worsening. people are doing things they normally wouldn't do. Who are they? People like us all and from all different kinds of backgrounds.

I personally have noting against anyone. Not the President of the United states, not the Pope or even our other Government officials. What I am against is how things have some how become very messy. Who do you blame? I blame the people for not rising up and really weighing in on the totality of being a Citizen of a free democratic society.

Weather it's in this country or any other country I do think we all have a responsibility to follow the simple GOLDEN RULES. I think respect is a good one to start with and was pointed out by admin (8/1/06; 04:05:50MT - usagold.com msg#: 146287) Michael J. Kosares.

I wish to thank you Mr. Kosares, for providing a great forum where individuals can express their knowledge and information on day to day living in this world. I have always been a fond admirer of Precious Metals and it has a rich history in my family's heritage. I have truly enjoyed and greatly appreciated many of the comments that you all so kindly take the time to add here.

I do apologize if I have acted out of line or offended anyone. My only intension when I post something was to seek added wisdom and advise or gain your valued insight and opinions. I do believe we all here for the main reason and that is to see how we can learn more about one of the most valued metals on earth. GOLD!

I wish you all a great harvest and a most prosperous life.

GF

Into the pits of zool goes the hopeless dollar. The financially and morally bankrupt US can no longer rely on the the dollar to retain it's value because of reserve currency status. The inept US leadership should be looking for friends in the middle east, instead they are making creating new enemies everyday. If the 800 Lebanese dead were caused by a natural disaster the US would be sending tons of aid, but because it is caused by Israel they are sending more bombs to cause more deaths. No country that finds itself on the wrong side of a conflict can expect to prosper. Buy gold, gold stocks, uranium stocks, diamond stocks etc.

http://www.strike-the-root.com/62/hull/hull1.htmlThe "power crisis" is a fake
Strike the Root
by Don Hull
SNIPS
There is no "shortage" of electricity anymore than there is a shortage of ice cream cones or ice cubes. The "shortage" we have is a shortage of FREEDOM.
+
We are overdue for a complete separation of electricity and state.

==

Compare: yesterday's discussion between Black Blade and me in msgs#: 146248, 146249, 146250 and 146252.

Ref TC's #146299

Even if he believes otherwise, of course Paulson HAS to take up from where Snow left off... with all the rhetoric about "strong dollar" being in the "best interests of the US" and "free markets" and moaning at China...all this to ensure a smooth transition and no dramas in the markets and amongst the financial fraternity...

Imagine if he were to do otherwise: "We want the dollar weaker." and "A weak dollar will help us reduce our trade balance because the American people will not be able to afford so many fancy imports." and "We recognise China is moving as fast as is wise...and we should never have implemented the crazy 'strong dollar' policy in the first place." Can you imagine the reaction?

A large hook would appear from off-stage, snaffle him by the neck and drag him to an unseen and very unpleasant fate...

No...what we see is Paulsen "impedance matching" the junction between Snow and He...to avoid unpleasant waves... Watch what happens down the track...

:-)

Paulson: "I believe that a strong dollar is in our nation's interest and that currency values should be determined in open and competitive markets in response to underlying economic fundamentals."

MK comment: This is a highly intelligent individual. Does he not understand that the first half of the sentence is cancelled by the second? I do not wish to make trouble for this man but any gold owner reading this propaganda should realize that this is political posturing DEVOID of any basis in financial reality. This is what happens when financial man meets political man.

TC: Thanks for you tireless efforts in digging this sort of thing up. It's easy for posters like me to dissect this sort of thing and make a comment. I'm certainly glad I am not resonsible for POLICY in this milieu.

Do not be surprised when your prior post disappears.
Violation of the table!

I being new here do not understand. Please elaborate.

It is improper to promote paper here. It is improper and in poor taste. Our host you may observe, asks in a gentlemanly way, that we not tout competative products (paper) here.

http://quotes.ino.com/chart/?s=NYBOT_DX&v=d6&w=1&t=f&a=200

If the trade deficit declines, doesn't that mean we have more paper waste here....thus Higher interest rates, inflation????

WATER FALLS we like?......slow cascades???

Of the only ten or so theaters across the country showing "America : from Freedom to Fascism", two of them are in the Tampa Bay area - one less than two miles from home, the other even closer to my work. Taking this as a strong hint that Destiny obviously wanted me to see it, I went this evening.

After what seemed to be a prudent move by paying cash for the ticket (somewhat spoilt by the fact that the girl behind the glass waved and said 'Hi!' to my daughter - so much for total anonymity), we squeezed into two of the last two hundred or so remaining seats. I'm not sure if this was just because it was early evening on a Tuesday or not - there were only twenty in the audience, but the rest of the complex was pretty deserted too.

The actual movie was pretty good stuff, including interviews with such familiar people as G. Edward Griffin, Ron Paul and Catherine Austin Fitts. The first half is an interesting investigation as to the legality of Income Tax (it would appear not, but I am moved to do more DD before failing to file next April !) which segs into the destruction of the dollar by the Fed and then goes on to talk about the removal of our personal freedoms by the use of the national ID card, RFID tags in paper money, RFID tags in US (!) and ends with a general call to civil disobedience to get rid of the Fed. Overall, nothing that would particularly surprise a goldbug, but it will be interesting to see if this limited release is sufficiently successful to catch a wider public (eg anyone in the western half of the country - Dallas is as far as it goes at the moment). Russo himself has announced his candidacy for the Presidency, but I'm sure that the mainstream media will do an effective job of ignoring him. It used to be that a candidate might write a book to express his views before the campaign, but with Al Gore producing a documentary too, I'm wondering if this might not be the start of a trend. Mind you, if that were the case, we can all imagine what would happen to the strictly factual content !

C!

http://www.robtv.com/shows/past_archive.tvDear Friend of GATA and Gold:

It's the wrong season -- too warm -- for television to be broadcasting "It's A Wonderful Life," but Report on Business Television in Canada today broadcast the summer equivalent: a "Market Call" interview by Jim O'Connell of Sprott Asset Management's chief investment strategist, John Embry.

Embry discussed manipulation of the gold market, predicted that the next move up in gold will be a big one, and reviewed the prospects for a large number of mining companies, including three GATA supporters -- Agnico-Eagle, ECU Silver, and North Atlantic Resources.

You can watch the Embry interview for a week at the ROB-TV archive on the Internet here:

http://www.robtv.com/shows/past_archive.tv

It's in the Tuesday column at 12:30 p.m.

CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.

http://www.cbp.ca/eventsPages/images/KRW06/W12-19_Archive.pdfNot interested in hearing stock tips (often pump and dump schemes). Look at Thom Calandra and his "Calandra Report", a report which I actually, briefly, for five seconds, considered subscribing to. Fortunately I didn't, as it was stock fraud through and through, and he got his slap on the wrist from the SEC. Stock purchases should be based on careful research, not tips.

http://topics.nytimes.com/top/opinion/editorialsandoped/oped/columnists/paulkrugman/index.htmlMK @ Paulson comments...

Hey Mike, long time to talk. Why would an intelligent individual like Paulson speak in terms of the same contradictions as his predecessors? Do you remember Krugman's "open letter" in the NYT a while back addressing Paulson on taking this job? Doesn't really have the answer to your question outright, but indirectly I think Paul K. has hit the nail on the head:

(For anyone wanting to read the whole thing, it's a subscription service, but the title was "Secretary, Protect Yourself" from June 2nd.)



So you decided to take the job, after all. It's no surprise that they wanted you. As the joke that's making the rounds puts it, they're so desperate they're scraping the top of the barrel. But most of us are surprised that you accepted.

No doubt you received assurances that like Robert Rubin, but unlike your predecessors in this administration, you'll get to be a real Treasury secretary. And you probably believe that those assurances can be trusted, if only because the Bush people currently need you a lot more than you need them.

But Paul O'Neill, who received tremendous acclaim from the news media when he was appointed Treasury secretary, must have believed the same thing.

Nobody was more loyal than Larry Lindsey, President Bush's first top economist. Yet when Mr. Lindsey blurted out an inconvenient truth [ . . . ] he was fired.

So what are you being asked to do that will undermine your credibility? What will they ask you to lie about?

Right now, you're being flattered. You have a natural urge to be a team player. But if you play the game your new bosses want you to play, your credibility with the public will evaporate in no time at all. And when you're no longer useful to your new friends, you'll be tossed aside.

Paulson: "I believe that a strong dollar is in our nation's interest and that currency values should be determined in open and competitive markets in response to underlying economic fundamentals."

I don't see necessarily a contradiction in the above statement-if you take the word "strong" not too literal.

http://www.nymex.com/media/delivery.pdf12.5K tricks turned so far for Aug, can they find the Oz's?, 12mo Lease rates on the up, lookin' good for a run to 4 digits ...even 'ol Buck can't hold her!
Let's go out on a limb ...5 digits!

http://www.nytimes.com/2006/08/02/opinion/02wed3.html?_r=1&th&emc=th∨ef=sloginThis from the NYT emphasises the continuation of the grand oil delusion...

Snip:

"...
The gulf might well yield enough natural gas to make a difference in price. But there is not enough oil there or anywhere else in the United States to make a difference in the price of a barrel of oil or a gallon of gasoline at the pump. Why the Senate persists in deluding itself on this remains one of the mysteries of the age.
..."


Reminds me of a Donald Duck comic I read once...but that is another story...

:-(

@ Knallgold,

To me, the contradiction is attempting to manipulate a "strong" dollar, but suggesting that "free markets" are the judge of whether it is strong or not.

If they're truly "free markets", what's the point of the promotion?

Surely, it's not just advertisement, or is it?

an advertisement would include the promo: "our taxes are low, our credit issue is stable, our budgets balanced, and our trade balanced or in slight surplus..."

As He cant say that, maybe he ought to hire an ad agency and come up with a catchy jingle.

You are correct pointing out the contradiction of promoting or manipulating a "strong dollar." In fact there should never be an adjective of any kind in front of the word dollar. Honest money needs no description and therein lies the fraud. By constantly invoking "strong dollar belief" he obfuscates the quicksand that all paper wealth is built upon. What Paulson really wants is for the dollar to devalue in an orderly fashion so as to not look bad against all the other fraudulent currencies. The race to worthlessness must be a silent affair.

To clear the debt this nation owes requires one of two things: Approximately a 95% tax on income, or a 95% devaluation of the dollar. My bet is on the latter.

One way to resolve the meaning of "strong dollar" such that policy-preference statements of "strong dollar" can coexist with those of "currency values should be determined in open and competitive markets" is to adopt the viewpoint that a "strong dollar" is not meant to directly translate into a "strong exchange rate".

If we were to understand the nuances of the game, we might more directly comprehend that it is merely political code by which the Treasury Secretary is effectively indicating a continuing preference that the U.S. dollar be retained in international usage as the primary international reserve asset.

The translation of the words give the following:

STRONG currency = RESERVE currency

To be sure, however, when other international parties obide by the above equation, the net result is that, due to this reserve usage, the dollar receives an inordinate amount of support in the currency markets which is not similarly enjoyed by its currency peers. Thus, at the end of the day, support for a "strong (i.e., reserve) dollar" does effectively translate into mechanisms that support a specially strong exchange rate -- albeit in means that it is accomplished more fundamentally through extra demand within "open and competative markets" (consistent with the stated preference) rather than through devious "intervention".

The fly in the ointment, however, is that if the U.S. (and the world) were to TRULY (fully and fairly) embrace the preferential notion of "open and competitive markets" with regard to exchange rates, then the dollar would not continue to be given a free ride as the designated reserve asset. The position of reserve asset would have to be opened up for competition, too.

And this, by and large, is what is happening in the form of OTHER countries slowly-but-surely liberalizing their gold markets and more especially in their central banks adopting mark-to-market accounting practices upon their gold reserves. To impatient gold advocates, however, the full process of transition from dollar reserve to gold reserve seems glacially slow, but that's to be expected given the nature of the system and the importance of preserving economic/financial/monetary continuity.

Another reason for the slowness of transition, as revealed by Paulson's de-coded message, is that the United States is resisting the transition. The U.S. simply does not want to give up the exorbitant privilege enjoyed by nature of the reserve status of its dollar.

Further evidence of this resistance also came recently from the Treasury Department's UnderSecretary, Tim Adams. Adams was interviewed two weeks ago (July 17th) in which the topic of the gold reserves of the IMF was addressed with regard to whether or not the IMF ought to follow suit with various other international central banking institutions in marking its gold reserves to market value and subsequently enjoying the benefits thus offered by beefy revalutions of gold to help backstop the IMF's meager financial position.

Tim said, frankly, "We, the U.S., do not think that gold is an appropriate option. For us, it is not an option."

The U.S., much like Rip vanWinkle, seems to have elected to effectively close its eyes as its official policy (military adventures aside), and snoozes in isolation as the surrounding world moves forward with inevitable changes. Such a closed-eyes policy may make for a more complacent "today" (as it has for these past several decades), but it will lead to a shocky, rude awakening when the dollar's special reserve status is rolled completely out of its cozy bed.

R.

I listened to the John Embry interview and I have a question to those most knowledgeable posters on this site. John mentioned that very little of the gold sales under WAG II have taken place this year. He stated that the end date for the annual sales of 500 tons occurs on September 26 coming, about 9 weeks away. I've picked up on those little nuggets supplied by Topaz concerning the delivery notices and I appreciate their meaning. Yet, the question lurks in the back of my mind. Are we likely to get bombed by another large sale of gold by the Central Banks? I have no doubts that the price of gold is going much higher once China opens their gold ETF but my observations indicate that it may not occur this year. I follow the FORUM on a daily basis and the insights by the many regulars are second to none IMO.

http://www.usagold.com/DailyQuotes.html
The Daily Gold Market Report has beenupdated.

If you are considering investments in gold we invite you to request our freeintroductory information packet detailing the products and services offeredby USAGOLD ~ Centennial Precious Metals. We welcome your inquiry and lookforward to working with you.

WEDNESDAY Market Excerpts

Gold up, oil climbs on storm and Mideast fears

August 2 (from MarketWatch) -- Gold futures closed higher, though off their best levelsWednesday, finding support in renewed oil price gains as Israel vowed to press ahead with its military offensive in Lebanon and as a tropical storm churning in the Caribbean threatened to turn into a hurricane.

October futures closed up $5.20 at $657.60 on the New York Mercantile Exchange, its highest close since July 17. [The most active contract, December gold, settled $5.30 higher at $664.10.]

"Gold bullion broke out of its confined ranges and once again reasserted its safe-haven attributes in active mid-week trading," said Kitco's investment analyst, Jon Nadler. "Encouraged by firmer oil prices (an approaching tropical storm has made oil traders nervous) and a slack dollar (as employment numbers appeared to contract during July), gold finally overcame the $652.50 spot price resistance point."

Oil futures were last trading up $1.12 at $76.03 a barrel.

"Not only is the situation in Israel and Lebanon not resolving itself, it is widening," said Thomas Hartmann, analyst at Altavest Worldwide Trading. "Left to its own devices, Israel could spend inevitable months pounding Hezbollah positions and strongholds throughout Lebanon.

The question remains whether Syria and Iran will keep to the sidelines if this drags on."

As long as the uncertainty persists, gold prices will be supported, he said.

Technically, gold's "in a big area right now," said Charles Nedoss, gold analyst at Peak Trading Group in Chicago.

"We've had good support above the 10-day moving average for the past few sessions, we could see a nice move up from here."

---(see url for full news, 24-hr newswire)---

-Touche!

... Thanks for your input!

cb2

Concealed SCO
http://www.payvand.com/news/06/aug/1022.html
SNIPS
The world is once again shrouded in a cold war, but this time a cold war shrouded in silence and concealment.
+
The emergence of the equally concealed Shanghais Cooperation Organization (SCO), sometimes termed as 'anti-NATO' or the 'NATO of the East,' is a testimony to the emerging hostilities, rivalry, opposition, and competition between the United States and its immediate allies and an emerging bloc based on the core of the Sino-Russian partnership that has been necessitated by the Russian and Chinese recognition that ultimately they are in the crosshairs of American hegemony.

Central bank calls for reins on bank lending
http://www.chinadaily.com.cn/china/2006-08/03/content_655904.htm
A report from the People's Bank of China has warned that unrestrained lending growth will continue to fuel economic overheating unless it is controlled.
SNIPS
Despite the government's macro-economic controls and stringent monetary policy, money supply jumped rapidly, noted the central bank.
+
Three (?) factors contributed to the lending surge.
The booming economy had buoyed up credit demand, while commercial banks enjoyed abundant capital to lend due to increasing liquidity and the widening gap between savings and lending.
Thirdly, commercial banks were paying more attention to returns and earnings, thus having more incentive to lend in a bid to profit, said the central bank.

If the link doesn't work, the headline is here;
http://www.chinadaily.com.cn/

http://en.rian.ru/business/20060802/52171345.htmlSNIPS
KHABAROVSK, August 2 (RIA Novosti) - Regional authorities in Russia's Far East are considering building a new pipeline to pump natural gas to energy-hungry China, a local governor said Wednesday.
The governor of the Khabarovsk Territory, which borders north-east China, held talks on the pipeline with a representative of U.S. oil major ExxonMobil.

http://today.reuters.com/stocks/QuoteCompanyNewsArticle.aspx?view=CN&storyID=2006-08-02T095100Z_01_L02592998_RTRIDST_0_ENERGY-EXXON-SAKHALIN.XML&rpc=66MOSCOW, Aug 2 (Reuters) - ExxonMobil Corp. (XOM.N: Quote, Profile, Research) plans to launch its De Kastri oil terminal, part of the Sakhalin-1 project in Russia's Far East, on Oct. 4, Russia's Vostok-Media news agency reported on Wednesday.
Vostok-Media said Viktor Ishayev, governor of Khabarovsk province on the Pacific coast, said construction of the terminal would be completed in early October, while a pipeline from the field to De Kastri had already been laid across Sakhalin Island.

More from the previous link
http://en.rian.ru/business/20060802/52171345.html
The governor said construction of the De-Kastri oil terminal in the Khabarovsk Territory had also been discussed at the meeting with Tern, and that the terminal, from which oil could be shipped to buyers in the Asian Pacific region, is slated to be launched on October 4.
Exxon Neftegaz Limited holds a 30% stake in the Sakhalin I project, the largest foreign direct investment project in Russia.
Sakhalin-1 is an international consortium comprised of Exxon Neftegaz, Russia's Rosneft (20%), India's ONGC (20%), and Japan's SODECO (30%), to develop the Arkutun-Dagi, Odoptu, and Chaivo deposits on the island's northeastern shelf. Their recoverable reserves are estimated at 2.3 billion barrels of oil and 484 billion cu m (17.1 trillion cubic feet) of natural gas.

http://www.bloomberg.com/apps/news?pid=20601080&sid=aYUs2LIhkbAU&refer=asiaThis Table is trying today to interpret what Paulson means by a strong dollar.
But does he want a strong dollar? Or a strong yuan?

SNIP from tomorrow
Aug. 3 (Bloomberg) -- China's central bank reiterated the government's intention to rein in the fastest economic growth in a decade and foreshadowed several measures, including greater flexibility in the currency exchange rate.
+
``They are making progress, but it is painfully slow,'' said Donald Straszheim, vice chairman of Roth Capital Partners LLC in Newport Beach, California. ``The problems that confront China now are primarily the result of their continued intervention in the economy, by having decisions made by the government rather than allowing decisions to be made by the invisible hand (Thank You Bloomberg) of the marketplace.''
+
Paulson, in his first speech since taking over from John Snow a month ago, said on Aug. 1 that China needs to show ``more flexibility'' by easing currency restrictions. That echoed calls from People's Bank of China officials including Yu Yongding, a policy board member, and Tang Xu, a research director, for a stronger yuan.

==

What does that Paulson guy want? Strong dollar or strong yuan?

Contradictions can't exist.
Check your premises!

�Tis impossible for the same thing to be and not to be at the same time and in the same respect. That's how the Principle of Non-Contradiction (PNC) is known since Aristotle.
+
This is a judgment which is naturally first, and which is presupposed by all other judgments.
+
The first judgment is called the PNC because it expresses the most basic condition of things, that they cannot be self-contradictory. The principle is based on "being", and expresses the consistency of "being" and its opposition to "non-being" ("non-ens")
+
It is quite evident that this principle is of basic importance, not only in spontaneous and scientific knowledge, but also in the field of human activity, since it is the first condition of TRUTH in any judgment.
(Alvira, Clavell and Melendo, "Metaphysics", Manila: Sinag-Tala Publishers, 1991, pp. 33-34).

The Principle of the Excluded-Middle states that "there can be no middle ground between being and non-being", or "there is no middle ground between affirmation and negation".
The judgment signifies that either a thing IS or IS NOT with no other alternative, and therefore, it is reduced to the PNC.
A middle ground is impossible because it would BE and NOT BE at the same time.
This principle is often used in reasoning, under the formula, "Every proposition must necessarily be true or false."
(Alvira et alt., op. cit., p. 40)

What's the middle ground between a strong yuan and a strong dollar?

Paulson is krazy!

If you saw that post, it needs to be revised. Apologies, MK

In short, I wish to make the point that all currencies are inherently and intentionally weak and that all roads lead to gold. Our Secretary of Treasury has been caught up in the whirlwind of competitive devaluation and for political reasons wishes to cast it as something else. I'll rework the details when I have more time.

The loss of the dollar's exchange rate (its international buying power � convertibility) is indeed linked to its imminent loss of reserve status.

It is therefore all the more surprising that the price of gold (POG) is "rising" without the convertibility rate of the dollar decreasing.

The gold-wealth-concept is on the move, while the dollar is being drugged into believing that she is "strong".
Why this reversal of past evolutions? Nobody bothers, let alone that one looks for an explanation.

The manuals have no answer. THEREFORE, the problem is a non-existent one.

The premises have hereby been checked.

http://www.forbes.com/markets/feeds/afx/2006/08/02/afx2924002.htmlSnip:

"...
BEIJING (XFN-ASIA) - China should set aside 20-30 pct of its foreign exchange reserves to be actively managed, a government economist said.

Xia Bin, head of the financial research institute within the Development Research Center, a think tank under the State Council, also said that China should increase its holdings of gold 'at the appropriate time.'

...

Xia also said that the global trade imbalance can not be solved in the short term, and that any attempts to do so by China or the US would create 'unimaginable, unacceptable and drastic volatility' for the global economy.
..."

Sundeck: Some recurring themes...increase holdings of gold, iron out trade imbalances slowely...

:-)

Article after article continue to point out the misgivings of our current affairs. I am wondering if there is any trust left?

It's just so blatant!

RE: miner49er (8/2/06; 01:00:37MT - usagold.com msg#: 146313)

Quote from:

But if you play the game your new bosses want you to play, your credibility with the public will evaporate in no time at all.

The dollar is dieing a slow death.

GF

http://www.financialsense.com/fsu/editorials/laird/2006/0730.htmlKurt Godel destroyed the PNC. Aristotle was wrong, or half right (isn't that logic delicious? Here, toke on this hobbit weed...)

So the dollar is "strong" in terms of Yuan (for the present) and euro, yen, and pound. Yet outside the tavern where currencies are trading, a golden mushroom is rising (smelling distinctly of naptha) Keeping one's reality to the inside of the inn and the dollar IS strong.

Poke one's head out of the smoke filled gaming salon and things look different. Which is the real reality? I'll vote for the mushroom, and not a mere game of chance.

Hmm.... To snip from C. Laird's article (the rest of which I do not necessarily agree with), this part is germane:

SNIP:
First of all, let us take a look at a typical US dollar argument VS gold. The usual argument is that the world will abandon the USD because the US has such deficits. This is the classic economic view, as if fair play in markets really exists. In other words, simple economic rules of fair play will initiate a decline or collapse of the USD, and consequently of the US way of life.

A more informed view would be otherwise. This view is that the collapse of the USD would remove the US from the forefront of world economic and military supremacy.

And, that our enemies and friends would NEVER allow a collapse of the USD without these issues in mind.

But, what of the possibility that the coming USD collapse will be allowed to happen, or caused to happen in conjunction with devious and damaging agendas against the US?...

END snip.

A few days ago, you asked if anyone was thinking oil embargo. I've been asking myself why President Chavez was visiting Iran recently. What if Iran and Venezuala (and Russia)were to simultaneously announce that they were going to sell oil for euros. Is that logistically posible, and what would the repercussions be, aside from an immediate (I'd think) US$ depreciation? Would that strategy not target the US specifically, rather than an embargo that would effect all economies with 3-digit POO? Cheers,

Waverider

Sorry, I dont know what the message # was, it was in the last couple of months.What's the middle ground between a strong yuan and a strong dollar?

Paulson is krazy!

Sir IH, you recal perhaps the tale of My Payday gaming days, when we ran out of cash and I as banker had to make up extra fancy notes to provide adequate circulating media? And then one day I brought in 3 cupcakes (banker's price: $4000) You remember the fate of the three cupcakes? The first was eaten. The second traded hands at a premium. The third was saved, then eaten. At that point, the looser who traded his cupcake for 300% profit tried to buy it back at an even more absurd price- realizing that he had just sold the ONLY REAL thing in THE GAME! And of course the game was over at that point.

http://www.futuresource.com/charts/charts.jsp?s=GC&o=100/DX&a=M&z=610x300&d=LOW&b=LINE&st=
The view of the Forest is clearly different to that of the Trees, I'd posit...and of course Gold smelt a Rat back in Jan '05 as she decidedly abandoned ANY relationship, inverse or otherwise, with Currencies.
The accompanying Chart clearly shops this with a slight adjustment to the scalings to reflect the reality ie: PoG/DX in lockstep 'till the '05 roll-over ...as does any good Gold:Currency Chart.
PoG reflecting inverse Dollar? 18 mth's ago, forget about it ...yesterdays news!
In fact PoG and Buck seem more content to rise and fall together lately ...Go Buck ...and Gold!

USD is up...POG is up!...Up or down...This rat ( My Oriental Astrological sign) is never going to eat, sell or trade his cupcakes!~

GOAL: Each month I will purchase some nice shinny stuff to add to my very own treasure chest. It's looking rather lovely now...JUST WAIT!

GF

http://www.futuresource.com/charts/micro.jsp?s=GC1%21&s=DX1%21&s=TYXY&s=CL1%21&s=&s=&s=&s=&p=D&v=15&b=LINE&d=LOW
...brewing here is that between Mr Market and Management as to the future direction of the Economy.
The last round saw Monsiour balk quite sharply at 5%.
Will we see another rebound against the managed stonewall ...or will it prove to be yet another Maginot Line and sail right through this time? ..my bet, the Latter.

http://english.peopledaily.com.cn/200608/03/eng20060803_289516.html(People's Daily Online) August 03, 2006 -- Affected by the continuous weakening of the US dollar, the gold price on the first exchange day or the last exchange day of July on China's market continued rising. On July 31st the prices of all the items on Shanghai Gold Exchange changed to a rising trend.

...after experiencing several major slumps from spring to summer, more and more investors are eager to make some earnings from the gold market. At the same time banks present paper gold, physical gold, and financial goods connected with gold -- one after another. Gold has provided a new channel for investment following stocks, foreign exchange, futures and real estate.

...domestic consumption of gold totaled 213.2 tons last year, ranking the fourth after India, the United States and Saudi Arabia...

However, because the gold exchange on domestic market still lies in the initial stages, the exchange volume of gold is still small...

The time of gold market settling in China is not long; not until July of 2005 did the Shanghai Gold Exchange begin to open formally to the public, without offering service of option transaction. Now there are mainly two parts for the investment in gold. One is physical gold, the gold bar, yellow boy and golden jewelry included. The other is paper gold; by owning a piece of warrant instead of physical gold one can attain proceeds with the rise and fall of gold prices.

While most consumers buy gold jewelry either for the sake of dressing up or presenting gifts, few take investment returns into consideration. Though some of the customers have the intention of making some investment, they are still looking on but do not take actions.

The latest statistics issued by the World Gold Council demonstrates that at present the consumption volume per capital in China is only about 0.2 grams, far below the level of 10 grams per capital in other nations and regions in Asia. Furthermore the investment proportion is even less.

From middle May, the gold spot price, after having successive surges, has fallen back to around US$ 640 from US$ 730 per ounce, but the average weekly price saw no big slumps. The analysts view that gold is still on a bull market and has no sign of weakening.

^---(from url)---^

It suffers a little in the translation to english, but the gist of it is certainly clear enough.

R.

http://news.uzreport.com/mir.cgi?lan=e&id=16270SNIP
On 2 August 2006, Secretary-General of the Shanghai Cooperation Organization (SCO) Zhang Deguang received at the SCO Secretariat US Assistant Secretary of State Richard Boucher and accompanying persons on their request.
==
Is anybody panicking?

http://www.middleeastforex.com/index.php?section=338&module=navigationmodule

snip
In principle, the GCC plans a common market among member states in 2007 and a monetary union and a single currency by the start of 2010.

--------------
brewing until ripe?

http://www.eepybird.com/This post is not (entirely) frivolous. Once you have watched the movie (my jaw dropped), you can go to other pages at the addressed site which explains what is happening. Essentially, a Mentos dropped into Coke will cause a spontaneous "undissolution" of CO2 so powerful that it cannot escape from the bottle in an orderly fashion. No-one knows exactly why it happens, as the effect is different with the object dropped into the soda, and the type of soda - by the look of things, the guys at the site are going to have a lot of fun creating a lot of mess experimenting to find out. There are other movies on the Web which show the soda bottle being used as a projectile - it can go over 50 yards so can be pretty dangerous.

So how does this relate to economics ? Well, suppose the economy is a bottle of flat water. No danger there - you can shake it about as much as you like and there's no pressure generated. Now introduce some carbonated water in the form of derivatives. If the bottle just sits there, there is still no danger, and the dissolved gas will slowly escape from the open top. Everyone knows that the bottle needs to be handled with more care, but the result is a more enjoyable beverage, so the risk is worth it. As the concentration of carbonated water increases, so does the risk. Eventually, any little thing falling into the bottle either as an accident, a mistake or by design, and KABLOOEEEEE !

This is why anyone that thinks that imbalances can be rectified by just letting things sit and correct "naturally" is dreaming. With no correction mechanism in place, the soda just gets more and more frothy.

C!

http://www.ecb.int/press/pr/date/2006/html/pr060803.en.htmlAt today's meeting, the Governing Council of the ECB took the following monetary policy decisions:

1. The minimum bid rate on the main refinancing operations of the Eurosystem will be increased by 25 basis points to 3.0%, starting from the operation to be settled on 9 August 2006.

2. The interest rate on the marginal lending facility will be increased by 25 basis points to 4.0%, with effect from 9 August 2006.

3. The interest rate on the deposit facility will be increased by 25 basis points to 2.0%, with effect from 9 August 2006.

@ Shanti,

Plan "B" for the Islamic Gold Dinar?

Or pure FIAT, to quell the disdain of western banks and PTB?

Are they learning to play the "spin game" from Libya?

http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2006/08/03/cnboi03.xmlItaly's central bank has switched a quarter of its foreign currency reserves into sterling, dumping billions in US Treasury bonds, in the most dramatic move to date by a G7 country to slash exposure to the dollar.
----------------------------------------------------------------------------------------------------------------------
First move by Prime Minister Prodi (= the former President of the European Commission) ?

Somehow Prodi must think the pound will prefer to join the euro instead of going down the tube with the $.

Indeed !
What do you think ? Will the UK join the Eurosystem in the long run ?

http://www.goes.noaa.gov/g8hu.htmlTrop storm Chris seems to have fizzled...the high altitude clouds are gone, the water vapor image is gone. Gandy, was this your doing? It wasn't me (I swear). I dont know what they call that "thing" rotating off the east coast of florida, but the flags are up for the weekend.

Oil can go back to discounting the Lebanese Football Game, as there's no news in the gulf (as if we needed another headache). Gather ye nuggets whilst ye may.

Britain joining the eurozone seemed always an impossibility,a big majority of the people are against it and Tony made a promise that there will be a public vote.Nevertheless,FOA et al. kept on insisting that she WILL join.I concluded that there will be some event or something else which will add unrefutable pressure to go euro.pandagold gave some hints along these lines.

Only question is,does the UK have enough PHYSICAL Gold left for going on a Gold MTM reserve standard?

What if the UK-gold, or a significant part of it, was sold to the BIS in some form of contract (off-balance) as 'an entrance fee' to the Eurosystem in a later stadium ?

http://www.usagold.com/DailyQuotes.html
The Daily Gold Market Report has beenupdated.

If you are considering investments in gold we invite you to request our freeintroductory information packet detailing the products and services offeredby USAGOLD ~ Centennial Precious Metals. We welcome your inquiry and lookforward to working with you.

THURSDAY Market Excerpts

August 3 (from MarketWatch) -- Gold futures closed lower Thursday, joining a pullback in oil prices as Tropical Storm Chris weakened, easing concerns it might become a full hurricane and damage infrastructure in the Gulf of Mexico.

Gold for October delivery closed down $7.10 at $650.50.

The contract gained more than $5 on Wednesday to close at its highest level since July 17, finding support in rallying oil prices and the continued violence in the Middle East.

Creating more crosscurrents for gold, the dollar traded mixed after a surprise interest-rate hike from the Bank of England that preceded an expected rate hike from the European Central Bank.

The Bank of England raised its key interest rate by a quarter of a percentage point, to 4.75%, and thus took back a quarter-point cut it made a year ago. In the statement accompanying the move, the central bank said that the pace of economic activity has quickened in the past few months and that higher energy prices have led to greater inflationary pressures.

The ECB also hiked by a quarter of a percentage point, taking its key rate to 3%, in a move also aimed at taming inflation.

The rate hikes come just days before the Federal Reserve holds its August meeting, with financial markets divided on whether or not U.S. policymakers will vote to raise rates an 18th consecutive time or not.

"Evidently, the fight against inflation is also a global war, just like the war on terror," said Kitco's analyst Jon Nadler.

Nadler is expecting the impact of various interest rate moves across the globe to become less important to metals once the gold jewelry season starts in late summer.

"For the moment it looms rather large in the eyes of investors and it also gives rise to more speculation that the US Fed may also have a surprise in hand next week-- this, despite every indication of a cooling (if not yet glacial) US economy," he said.

---(see url for full news, 24-hr newswire)---

http://www.shanghaidaily.com/art/2006/08/04/288148/Authority_signals_yuan_move.htmSnip:

"...
CHINA'S central bank has vowed to make its exchange-rate regime more flexible in broad efforts to cool credit-spurred economic growth, a sign analysts say could lead to a long-haul appreciation of the yuan.

The People's Bank of China plans to balance international payments by a raft of measures involving "propping up the yuan's flexibility," it said late on Wednesday in a statement through Xinhua news agency.

Other incentives will cover bolstering domestic consumption and diverting household savings as well as encouraging imports and urging private funds to invest overseas, it said.
..."

Sundeck: 'ullo, 'ullo, 'ullo! What's all this, then? Moves afoot in out-of-control China to let the yuan rise and rein in the economy and balance of trade?

:-)

http://www.mises.org/story/2263
But of all the consequences of central banking and fiat money, war is the worst because it exacts the biggest price from citizens and foreigners and everyone else caught in the crossfire. That is why sound money � by which I mean the gold standard � is a key to peace and freedom.

-- Lew Rockwell

EXACTLY SIR Goldendome!

RE:Goldendome (8/3/06; 23:48:54MT - usagold.com msg#: 146353)

@ Gold Finger and Goldendome.

. . . and why the "Money Masters" and "Wizards of Money" episodes are so "controversial".

For those who haven't already, see 2/17 archives:

Kilo (2/17/06; 09:48:11MT - usagold.com msg#: 141736)
Trivial Pursuits
Sometimes we spend too much time trying to understand individual pixels when we need to spend a little more time on the whole picture.

Money Masters Part 1:

http://www.propagandamatrix.com/multimedia/Money_Masters_Tape1_Part1_all.wmv

Money Masters Part 2:

http://www.propagandamatrix.com/multimedia/Money_Masters_Tape2_128KBps.wmv

Enjoy.....

-G'lox

The same thing happens in "official science". Instead of returning the fruits of serious research to their funding taxpayers, NASA gives us "Tang", the legacy of our "space program." Real space conquest is done by Bert Rutan and privately funded pioneers for less than NASA spends on PR!

But Bucky Fuller said it best: "When a greater proportion of GDP is invested in securing the status quo than on true progress, that society is in decline"

- paraphrased

http://www.goldworld.com/article.php?id=37
I do think that leadership in this country is what sets the tone or "physiological" impact upon the Citizens here and the people of the rest of the world. We've had big dept before, but with all the world events and negative impact and lack of good diplomacy I can see why SO many are loosing more and more confidence in the USD.

I read a similar article that Italy was dumping billions in us Treasury bonds and converting to Sterling!

More...to follow I am sure

@ Gold Finger,

"I do think that leadership in this country is what sets the tone for "physiological" impact upon the Citizens"

While I would agree that the Supplemental Medicare (Big Pharma price support) bill, and the general attitude of the admin toward drug supplier liability, the CODEX, and subsidized mass purchases of unproven vaccines and "remedies" reflects the admin's general attitude about "physiology", many would suggest I am moving too far afield of topic.

Do you possibly mean "psychological" impact?

Or are you just using that term as a euphemism for "generally peed off"!

Attractive as it would be to simply take Rockwell at his word regarding his association between themaking of fiat money and the making of war (essentially saying that war could be abolished if fiat currency were abolished), history begs us to indentify that notion as a utopian falsehood. Two handy examples from very close to home (in space and time) provide the necessary instruction on this point.

1) We launched into the U.S. Civil War despite our being on a bi-metallic (gold and silver) currency system.

2) We launched into World War I despite many of the participants being on a gold standard.

Sure, paper greenbacks and confederate currency came along to prominence in the Civil War, as did the abandonment of the gold standard and implementation of fiat currency in WWI, but this development misses a most important point.

That point being, if the metallic monetary standard fails to prevent the war in the first place, then all subsequent arguments about the nature of money goes out the window. Because once a nation deems itself engaged in a struggle for its very survival, there is no power on Earth that can compel such a nation to cling fast to its metallic currency standard if the legislators deem that a fiat currency would be expedient to facilitate the war effort.

Here's the bottom line on it: In the very thick of it, the scale and scope of a nation's participation in war is not limited by the extent of the metal or paper fabric of a nation's currency, but rather by the extent of that nation's real resources. Throughout the affair, the role of money (whether in the form of gold currency or paper) is merely an accounting mechanism that the nation uses in the economic mobilization of its resources and production.

And as it all shakes out, the wealth of a nation in PEACETIME is ALSO determined in very much the same way -- upon the extent of its resources and the efficiency of its production and mobilization of capital. And the role of money is to help organize and lubricate the workings of the economy. To be sure, any gold metal within a nation is counted among the nation's total stock of resources, and very obviously, it need not (and ought not) any more than any other physical resource be enmeshed (underutilized) in the physical makeup of the nation's currency/banking system.

Given the structure of fractional reserve lending as the basis of our monetary system, the cold hard truth is that use of metallic (gold) currency propagates a nasty falsehood -- the coins are just a subset of the entire money supply but it nevertheless causes ill-informed participants to wrongly believe that the entire money supply is "as good as gold".

It is Another cold hard truth for some people to swallow, but in light of the preceding paragraph, the use of a fiat (paper) currency system is a much more honest means to represent the intangible "nothingness" -- the appropriate embodiment of the network of accounting which is the actual basis of a monetary system.

Clearly, the conclusion to be had from all of this is that a nation's monetary/currency system does not represent the wealth of that nation. Money is merely a utility to be used, to be borrowed and spent. Again, think of it solely as a mobilizing lubricant within an economy -- it has value while in use, but none otherwise. The wealth of a nation, and of its people, is not in its artificial money, but rather in its various resources which can be mobilized for both local and international deployment. It makes little sense to "save" money, as money is an ethereal utility which can be mismanaged and hyperinflated into dysfunction.

Because of this difficult truth, "Your wealth is not what your money say it is," as Another used to say. Instead, your wealth, properly measured, is the tangibles you've accumulated, the store of resources you've saved. And among the world of tangibles, gold is globally the most liquid -- the most universally recognized, honored, and accepted.

In time of war, governments may (and history has shown they often do) recognize and declare that gold is too valuable to be wasted underutilized (undervalued) in the representational coinage of national currency. Therefore, fiat currency is adopted, and gold is instead mobilized in its fully-valued form -- a tangible resource uniquely and reliably suitable for any and international settlements.

Blunt summary:
Our monetary system, in an attempt to be HONEST, chooses mere digits and PAPER as its representational currency. And consequently, in an effort to act WISELY, we unabashedly use this currency for immediate transactions, whereas we SAVE for our livelihoods by acquiring GOLD.

R.

when the wall street crowd start shouting that the FED is done because the unemployment rate went up a couple of points. Fed Fund futures are saying its an 80% change they will not hike. In the details of the report, it did show wages were up and that may hold the FED on its steady course of increased. Don't know. I probably think its more like a 50-50 bet.

I can say, if the FED doesn't raise 25bps next week it might really slam the dollar and break key support.

To me the gold chart looks bullish. If you connect the last two tops with a straight line you get the resistance line. If it breaks up and out it could really go!

Rest up on the weekend, because next week is going to be exciting!

3:49p ET Friday, August 4, 2006

Dear Friend of GATA and Gold:

The fall dinner meeting of the Committee for
Monetary Research and Education, to be held
in New York City on Thursday evening, October
19, will have some speakers of special
interest to gold and silver investors. Among
them:

-- Pierre Lassonde, president of Newmont
Mining Corp.

-- Paul van Eeden, precious metals newsletter
writer and international lecturer.

-- Bob Hoye of Institutional Advisors, whose
market commentaries are often featured at
metals-oriented Internet sites.

-- Alan Brown of Aurumbank Inc., who may be
best known for the gold and financial market
commentaries of Professor von Braun of the
Rocket School of Economics.

As is customary, the CMRE meeting will be
held at the beautiful Union League Club at
38 East 37th St. in Manhattan, just a few
blocks south -- easy walking distance --
of Grand Central Station. The meeting will
begin at 4 p.m. with a cocktail hour and
get down to business at 5. Dinner will be
served at 6 and things usually wrap up at
about 9:30 p.m.

Your secretary/treasurer and other GATA
partisans plan to attend, but don't worry;
we're always very well-behaved, even when
people connected to the Federal Reserve
and Treasury Department are speaking. But
if there is enough interest afterwards,
we'll lead a march downtown to the corner
of Broad and Wall streets to protest naked
shorting, and with luck we'll still have
our clothes on.

Tickets are $155 each for CMRE members and
their spouses and $165 for others.
Reservations are necessary and should be
made with CMRE President Elizabeth Currier
here:

Elizabeth Currier, President
Committee for Monetary Research and Education
10004 Greenwood Court
Charlotte, North Carolina 28215-9621
USA
Telephone: 704-598-3717
E-mail: CMRE@Bellsouth.net

We hope to see you there.

CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.

http://www.theglobeandmail.com/servlet/story/LAC.20060804.RBARRICK04/TPStory/BusinessGold Bugs Look to Smaller Stocks;
While Barrick Seen as Good Bet,
Analysts See Better Gains
in Small- and Mid-Caps

By Shirley Won
The Globe and Mail, Toronto
Friday, August 4, 2006

Barrick Gold Corp.'s stock may appear to be gaining more lustre thanks to its takeover of Placer Dome Inc. and the elimination of Placer's hedge book, but analysts say the big gains are still to be had with the smaller gold miners.

The world's largest gold producer is basking in a somewhat muted limelight after its record $459-million (U.S.) second-quarter profit that got a big boost from soaring metal prices and the acquisition of Placer last year.

Shares of Barrick fell 28 cents (Canadian) to $35.93 yesterday on the Toronto Stock Exchange after climbing more than 7 per cent in the five days preceding its earnings release after the close of trading Wednesday. On the New York Stock Exchange, its stock finished off 37 cents (U.S.) at $31.83.

"They [Barrick] have been hampered by being overly hedged ... and they still have a significant hedge going forward," Desjardins Securities analyst Michael Fowler said yesterday.

Hedging is a technique in which a company contracts to deliver gold in the future at a particular price. It can protect miners from falling gold prices, but hampers profit in a rising price environment.

On Wednesday, Barrick said it has reduced its hedge book by 7.7 million ounces so far this year. The update came as it announced stellar results that topped the highest full-year profit of $401-million made to date by the Toronto-based gold mining giant.

Barrick's unwinding of the Placer Dome's hedge book is "positive," but the remaining position is still around 13 million ounces if one includes the company's development projects like Pascua-Lama in South America and Pueblo Viejo in the Dominican Republic, Mr. Fowler said in an interview.

The gold giant's growth strategy has been focused on building a pipeline of projects through acquisitions like Placer Dome in March, and a decision to make a $1.3-billion hostile bid for Vancouver-based NovaGold Resources Inc.

While Barrick has some big projects in the pipeline, Mr. Fowler said the problem is that much of that increase will be offset by production declines at maturing mines.

While he has a "buy" on Barrick with a one-year target of $47.50 , he prefers mid-tier gold producers like Iamgold Corp., Kinross Gold Corp., and Agnico-Eagle Mines Ltd.

Veteran gold watcher and analyst John Ing of Maison Placements Canada Inc. echoes a preference for mid- and small-capitalization gold miners over Barrick.

"The hedge book has always been a problem, and maintaining growth has always been a problem," Mr. Ing said. "If you are a gold miner, you have to grow because you are quickly depleting your resource ... Virtual size precludes them from being able to grow other than through acquisitions."

Mr. Ing prefers smaller unhedged gold companies like Eldorado Gold Corp., Agnico-Eagle, Bema Gold Corp., and Kinross, "which have superior growth prospects."

"Barrick would be a more conservative bet," Mr. Ing said. "Rising tides lift all boats. I expect that the $850-level [per ounce for gold] will be surpassed within the next 12 months, and that will lift all stocks."

Hayward Securities analyst Kerry Smith said Barrick is his big-capitalization gold pick, adding that it should only be compared with peers like Newmont Mining Corp. and AngloGold Ashanti Ltd.

Barrick's profit and cash flow are "relatively predictable," said Mr. Smith, who has a "buy" on Barrick with a one-year target of $44 (Canadian). "They are well capitalized. They don't have balance sheet issues."

If you go to smaller gold miners, "their balance sheet may not be quite as good, and they have a lot of their share price predicated on growth, and they have to deliver on that growth," Mr. Smith warned.

"There are more risks attached to a growing company versus a company that is just maintaining the status quo [in production terms], which is what Barrick is doing."

http://www.mineweb.net/gold_silver/872674.htm11:30a ET Friday, August 4, 2006

Dear Friend of GATA and Gold:

On the basis of Barrick Gold's Thursday
conference call with financial analysts,
MineWeb's Dorothy Kosich reports that
Barrick does not intend to close at least
9.5 million ounces of the 13 million
ounces remaining on its hedge book. The
MineWeb story also includes comments on
Barrick's bid to acquire NovaGold. You
can find it at the link above.

CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.

http://www.usagold.com/DailyQuotes.html
The Daily Gold Market Report has beenupdated.

If you are considering investments in gold we invite you to request our freeintroductory information packet detailing the products and services offeredby USAGOLD ~ Centennial Precious Metals. We welcome your inquiry and lookforward to working with you.

FRIDAY Market Excerpts

Gold down from intraday highs, up $8 for week

August 4 (from MarketWatch) -- In Friday's release of data, nonfarm payrolls expanded by a lower-than-expected 113,000 in July, raising the odds that the Federal Reserve won't raise U.S. interest rates again when the central bank's policymakers convene on Aug. 8. The dollar weakened markedly against foreign currencies on the heels of the data.

Trading in a volatile pattern, gold for October delivery settled down 90 cents at $649.60 on the New York Mercantile Exchange, after being up as much as $9 earlier in the session. Last Friday, when the front-month contract was August, gold closed at $634.80 on NYMEX. October futures were at $641.40.

"A new all-time high in gold is not a question of if, but when," said Peter Grandich, editor of The Grandich Letter. Grandich cited a combination of factors pointing to higher gold prices: a dollar that he called "terminally ill," geopolitical hotspots that "look like they have to get worse before they can get better" as well as favorable investment demand and gold now entering what's traditionally a seasonally strong period as jewelry purchases ramp up.

Kitco's analyst Jon Nadler said, "The perception of the cooling economy reinforced the position of those market participants who believe that next week's Fed meeting will be just that -- a meeting without a resulting change in interest rates, however, "there remains "ample evidence that inflation is ... alive and well." Indeed, the Labor Department's payrolls report showed average hourly earnings are up 3.8% in the 12 month through July.

"The combination of these opposing forces signals stagflation -- a scenario feared by many, especially in an election year."

(from Reuters) -- Electronic trading of financial, metals and agricultural futures at the Chicago Board of Trade was halted by technical problems on Friday, triggering shutdowns at exchanges in Kansas City, Minneapolis and Winnipeg, Canada.

Electronic trading at all the exchanges resumed at late morning, after about two-and-a-half hours, but the shutdown raised some questions about the CBOT's trading platforms. The glitch came as CBOT gold volume so far this week had been surpassing that of the once-dominant COMEX gold futures.

At settlement, COMEX most-active December gold was down $1.00 at $656, while on the Chicago Board of Trade, December gold was trading 70 cents lower at $656.70 as of 2:42 p.m. EDT.

---(see url for full news, 24-hr newswire)---

http://www.newspress.com/Top/Article/article.jsp?Section=BUSINESS&ID=564782087954368069WASHINGTON (AP) - Treasury Secretary Henry Paulson plans to lead a delegation to Colombia on Monday to attend the inauguration of Colombian President Alvaro Uribe, a spokesman said Friday.

President Bush asked Paulson, who took the Treasury helm in early July, to make the trip. Commerce Secretary Carlos Gutierrez also will attend the inauguration...

Paulson plans to meet with Uribe. He also plans to meet with Peruvian President Alan Gracia, who is also expected to attend Uribe's inaugural ceremony...

^---(from url)---^

How well do you understand the foundation of the U.S. Dollar and the Treasury bond?

It shouldn't surprise anyone that, from among the broad Cabinet of luminaries and dignitaries, it was the Secretary of the Treasury who was chosen as the principle represetative of the United States for this particular house call.

The foundation is eroding. Choose gold.

R.

If the American people ever allow private banks (the Federal Reserve Banks) to control the issue of their currency, first by inflation and then by deflation, the banks and corporations that will grow up around them will deprive the people of all property until their children wake up homeless on the continent their fathers conquered.." -- Thomas Jefferson

There are two ways to acquire the niceties of life: to produce them or to plunder them. When plunder becomes a way of life for a group of men living to- gether in society, they create for themselves in the course of time, a legal system that authorizes it and a moral code that glorifies it.

Congress shall have Power to coin money and regulate the value thereof ... No State shall make any Thing but gold and silver Coin a Tender in Payment of Debts.
-Art.1 Sec. 8 & 10

America's system of constitutional, commodity-based money functioned well in our nation for 125 years, from 1792 to 1913. Then "We the People" made a big mistake - we allowed a privately owned corporation called the Federal Reserve to begin creating paper money instead of gold and silver coins as the Constitution requires.

History has proven time and again that neither bankers nor governments possess the discipline needed to limit the amount of credit (or paper money) to equal the true supply of gold and silver coins. So the supply of paper money (credit/debt) must continually rise. The result is always disastrous in the long term because the economy suffers through cycles of inflation, deflation, artificial growth, recession and depression. Because U.S. citizens did not protest the use of trust money, our economic system then began to degenerate into untrustworthy or fiat money.

Lenin pondered this modern flaw in the Capitalist system stating, "The best way to destroy the Capitalist system is to debauch the currency. The process of inflation is so insidious that not one in a million can properly diagnose it, until it is too late."

The above is elementary to some, if not most. For those fortunate soles discovering this forum (thank you MK and all) stay tuned. The truth is VERY powerful, but cleverly hidden from most........................Acquire GOLD.....always remember debt steals and gluttony blinds.........................AMF

http://www.mineweb.net/gold_silver/869154.htmJOHANNESBURG (Mineweb.com) -- Growth in new production across the global gold industry is not going to spike any time soon, despite a spot price currently at multi-decade highs.

Ian Cockerill, chief executive of Gold Fields, describes replacement as the new growth in the global mining industry, with very few large scale deposits being found to mine.

"The net result is that it is almost inevitable that new mine supply is going to decline, before it recovers, if it ever does recover," Cockerill told guests at his company's fourth quarter results presentation...

"I always believed it is the role of an executive team not just to look at the next quarter, our job is to make sure in 10-20 years time we still have a company," said Cockerill.

Globally, Cockerill says there are projects, which are looking attractive at existing gold prices, but that production costs are also on the rise.

"People look at a rising gold price, and say where is the problem, there should be plenty of new mines coming on board. They are forgetting the other side of the equation and that is the input costs."

These costs have increased dramatically in the last few years, and Gold Fields says it is working hard at keeping costs in check.

"What five years ago would have been an attractive project at $400/oz, might need $500/oz maybe $600/oz today, simply because of the cost of tyres, fuel and such lot," says Cockerill.

^---(From url)---^

"I always believed it is the role of an executive team not just to look at the next quarter, our job is to make sure in 10-20 years time we still have a company..."

That is EXACTLY what many gold mining shareholders/investors do not fully understand.

In order for a mining company to still be in the business of mining for as long as possible, they have to extend the life of their mine for as long as possible.

To do this, coincident with an increase in the general price level of gold, the miners will always seek to expand the life of their reserves by mining (at greater costs1) the ever-more-marginal regions of their orebodies.

As a result, the executive policy is that mines are generally always operated at break-even strategies, and hence there is rarely any fat profitability to be distributed to shareholders in the form of dividends, and also precious little rationale for capital gains as the most business-savvy investors are too wary to bid up the share price to chase that elusive goose.

As time marches on, even the most pedestrian of investors will come to realize that PHYSICAL gold is the most natural and reliable strategy for both achieving security and serving their quest for capital gains.

R.

The spenden good money after bad has taken on a new meaning. The US is losen in Iraq, Lebanon, and has pulled outta Afganistan. The USD is toast. Gold is the best alternative.

I think I finally figured it out. The US attack on Iraq was only done to give support for an Israeli attack on Lebanon. There is no other reason for the attack on Saddam and company. They decided that 3 years would give them enough time to subdue Iraq. Then Israel would attack Lebanon. Syria would be isolated and so fall then the new juggernaut would move on Iran. They haven't acheived their first goal.

Thanks to the posters here for sharing their wisdom and their information references, and thanks to the proprietor for providing this site.

It is always a pleasure to catch up on a few days or weeks missed posts and discover recent additions to posting names.

Melda Laure, there is poetry in your words, thanks for the good reads.

How silly! I never read a theory so absolutely wrong. Please stick to gold and economics and leave the military and political thinking to others.

White Hills

http://www.lewrockwell.com/decoster/decoster114.htmlWhat sir TC! You mean higher prices WONT bring on ramped up gold supply!? Where have I heard that before? Dont you belive in supply and demand? [maniacal laughter!]

I was rather shocked to read Martin Goldberg's thursday (8.3.2006) market wrapup:

http://www.financialsense.com/Market/daily/thursday.htm

"A stock market that can be led by a company sporting GM's current (lack of) fundamentals is capable of doing practically anything in the intermediate term... ...this is a market containing crumbling internals which is capable of doing almost anything in the intermediate term." [ML comment: rather like a drug addict!]

.END SNIP.

Fuel Free cars couldn't save GM, (toyota would win).

The referenced article in Lew Rockwell was also quite frightening, not for what was said- (which crimes and indictments we have heard uttered in these halls long ere today), but because of who was saying it. Who now can doubt that gold is "managed"?

I'm reaching the end of reason here, Sir Ten Bears, it is said at the end of rome, those who still saw clearly enough retired from The City to their country estates there to compose poetry - presumably because public discourse had become futile! Amazing that Ms. Holloway and Mrs Yates both merit equal time with 100,000 iraqui demonstrators in downtown Baghdad.

Master Kosares, if ever there is time, a complete CD-rom of the forum archives in text files, (or a suitable file.zip FTP link) would be a handy addition to your wares. The internet is now the last bastion of freedom, use it well while it lasts.

While iraq may be #15 in oil production it is thought to be #3 in reserves- #2 if you misdoubt the Saudi's reserves. Yet beyond that, Sir Golddigit, between Jerusalem, Babylon and Gizeh lies an ancient bond predating man's use of oil. (and do not forget Baalbek in that list.) Indeed, some claim it predates men (but not gold)! Enough of such things, clearly you at least feel that something more than mere greed is at work.

In the last days of its might before numendor fell, Ar Pharazon built his great armada, and went off to the conquest of Valinor, as in the title of Mr Bernsteins book, "against the gods". Too bad that fate has not gifted us a leader with the eloquence of el dichoso y ingenioso hidalgo, (aunque tenga el ceso bien seco y con poca sal) don Quixote de Crawford, o Little Rock, or whatever home town you like as these gentlemen have not the eloquence of FDR nor of Reagan, not that it matters for we are cursed with an inordinate number of ill-cast sanchos from Mr ORillemUp to the doofuses on CNN-lebanese-football-season or the CNBC clown-fest.

Gentlemen of the media- scoring political points wont matter once we're all dead. With your high calibre of modern day info-crusaders, our enemies may just decide to sit down and laugh at us until the dollar explodes over our fatuously inflated heads: the dollar toilet has a golden pull chain.

At the least we can die laughing at our "bipartisan" leadership as we laugh all the way to the coin shop.

I think it's good to hear and even read about ones perspective on things. I may not always agree but the insight may offer or even spur a thought.

Some may add something more constructive and others will even add something even critical. As we can very well see the USD is not the only thing that impacts the PoG.

There are many elements that are involved. I think we need to realize this and just accept it. Religion and Politics aside, they do have an impact.

http://www.financialsense.com/fsu/editorials/mchugh/2006/0306.htmlWell that was ill timed! Sorry!

SNIP:
Our suspicion has been that the "Working Group" established by law in 1988 to buy markets should declines get out of control has become far more interventionist than was originally intended under the law. This group has since been dubbed the Plunge Protection Team. There are no minutes of meetings, no recorded phone conversations, no reports of activities, no announcements of intentions. It is a secret group including the Chairman of the Federal Reserve, the Secretary of the Treasury, the Head of the SEC, and their surrogates which include some of the large Wall Street firms. The original objective was to prevent disastrous market crashes. Lately it seems, they buy markets when they decide markets need to be bought, including equity markets. Their main resource is the money the Fed prints. The money is injected into markets via the New York Fed's Repo desk, which easily showed up in the M-3 numbers, warning intervention was nigh.
END.

Only oil can cover oil sins. And only Gold can cover those who buy physical. We have "transgressed" greatly against the paper iniquities, so sin all the more that your "grace" may "abound".... (that's supposed to be silly Sir White Hills, but I will try to restrain myself)

Exactly what are TPTB doing behind the M3 "curtain"? Well, let's not offend with a litany of indecencies.

Mr Reagan should have known better, though (for the sake of his many fans here) it might be noted that by 1987 he may not have been in full control of his faculties, or even (many suggested at the time) of his presidency. I do not wish to blame the authorship of the PPT order on any person, but rather to suggest that fresh look at the precise historical details of its genesis are now warranted. To be an equal-party-offender, who today belives the 1913 act was the brainchild of Woodrow Wilson? Exactly so! Thus, who REALLY instigated the PPT?

Well, who cares now, cest fait accompli, quite transmogrified from any original intent, and neither party will kill it.

Meum Culpum, I thought you were trying sarcasm, sir GF, as it did seem hairbrained on the face of it.

Given the garbage cheerleading on Fox, and the rabid hissing and booing from, well, almost everywhere else, it is hard to find any cogent analysis of what our president is trying to achieve. It is hard to find genuinely fundamental strategic facts.

Clearly the administration has long term plans (bipartisan plans even) and given the animosities of the region, the use of limited force was part of the strategy (and for other reasons). Unfortunately, in the melee of flying rotten tomatoes it has become a total fog, apart from some of the associated jockying between the US-Russia-China-Iran. In this discussion, afghanistan has fallen off the chessboard! These are the facts, few, and unchanged since last year:

Oil has become a strategic issue.
The war will continue, with slow progress and great expense.

I propose that the number of very angry Muslims does not have a particularly critical effect on the dollar, gold, or oil, as they do not produce dollars (the Fed does that) nor gold (Russia, SA, Canada, etc.) nor even much oil.

That bears repeating: Angry Muslims do not produce oil. To be sure, there are many of them in Saudi, not the least because they hate their own government, which is nominally pro-western. In the case of Iran, there is only one man who matters, (and I doubt that he obeys public opinion). Iraq is already shut down. That leaves Nigeria, also partially shut down. Can anyone name any other oil producing nation on the verge of political chaos?

Exactly so. From any state well controled by its authoritarian order, there is no need to fear an oil disruption until it happens by decree. Such actions are done with much more circumspection than the acts of a mob. Oil will flow. And it flows better from Tehran than from Basra at this time, (I would guess).

I doubt an embargo is comming just yet, (MK's comment to the contrary). Fear not the Iranian President, fear rather the day when his motorcade is pelted with stones and tomatoes as is done in iraq.

Enough already! Good night!Oil will be strategic even after the dollar implodes

Even should the euro take the reins, credit derivatives and peak oil remain an issue.

For the dollar, gold is a mortal threat, for the euro, it is a strategic threat.

The border security issues Israel faces are in south Lebannon, Gaza and WB. The strategic issues are future Iranian Nukes and the future of US support (and we know what threatens the US).

The credit monster is firmly in the hands of the world banking fraternity. They will kill it when it pleases them. My opinion (worth 2 turkish lira) is that Mr Buffet is wrong, these weapons of mass financial destruction are in the hands of prudent parties, not cowboys. A kinder gentler fascism if you like.

These are the knowns.

The unknowns are the exact dynamics of global warming, the slope of the peak oil curve, the topology of the peak oil, vs price space (a multi-dimensional lamina, multi-variable price function) and the future of free energy. I would expect to suffer much "operations research" as those dynamics are tested in the same way that oil siesmometry is practiced.

I do not wish to label anyone, (everyone applies their own labels, thus my opinions are worth little). The present obsession of the west with "islamofascism" or whatever the label of the day, is probably over done. In regards to dollars and gold, the dancing mobs are as impotent as the ranting gold bugs. At some point, it will be a discussion regarding gold, water and food. Stocks, bonds, credit and so forth are only a means to an end. Gold is imperishable and compact.

BTW: If it is food you want, then the major sources are the nile and the dipotami. The Litani has been mentioned, but this is needlessly inflamatory, as we have no conclusive data at present.

http://www.usagold.com/buy-gold-coins.html

http://www.golan.org.il/water.html@melda laure,

Add the Litani River to "knowns" of the Israel-Lebanon subset of the "Resource Wars". As Puplava has warned us for a number of years, water is the "next oil". Israel is in dire need of additional water, and annexation is the only opportunity to increase its sources.

The Golan (Syrian Heights) district, spoils of the Six Day War, now provides 30% of Israel's current water resources.

If and when any "withdrawal" is announced, rest assured that control of the Litani head waters will lie in Israeli hands.

What's your take on the situation?
The political situation as it influences the USD has a great impact and POG. There are many other influences on POG such as the density of sun spots, etc. but we won't get into that just yet.

http://www.energybulletin.net/18474.htmlsnip:

From the Saudi Arabian sands pour more than 9 million barrels of crude oil each day, more than 10 percent of the world's production pumped from what is believed to be the largest pool of recoverable crude on Earth.

For three decades, it has been Saudi Arabian oil that poured into the market to dampen rapidly rising prices and Saudi cutbacks that pushed prices back up when they were abnormally low.

The Saudis say they are still committed to affordable, stable petroleum. But prices have roughly tripled in four years despite periodic Saudi announcements of plans to pump up production.

Control, it seems, has slipped away.
So when the Saudis a few weeks ago suddenly reversed field and announced a production cut, some analysts scratched their heads and wondered if, at long last, Saudi Arabian oil production has peaked. If it has, the effect is potentially huge on oil markets and the price of gasoline at the pump.

"When the price is high, that's when you want to take out your oil and sell it," said economist Ujjayant Chakravorty of the University of Central Florida. "I am wondering if they have some production issues."

In the past, the Saudis have repeatedly passed up the chance to maximize short-term profits. Instead, they have seen high prices as a threat to global economies and an incentive for development of alternative energies that would threaten their cash cow.

When prices have been high, they have pumped more.
"If your concern were energy market stability and not your income level, you'd put more oil out in the market," said Amy M. Jaffe, energy fellow at Rice University's Baker Institute. "Why do they see something different now? It doesn't make sense to me."

SAUDI ARABIAN OIL
� PLANS:
Boost production capacity to 12.5 million barrels per day by 2009.
� HIGHEST PRODUCTION:
9.6 million barrels a day, mid-2005.
� RESERVES:
259 billion barrels. [contested -AF]
� LARGEST OIL FIELD:
Ghawar pumps 4 or 5 million barrels per day; estimated reserves between 61 billion and 131 billion barrels.
Sources: Rigzone, U.S. Energy Information Administration, Simmons and Co., Oil & Gas Journal
Not anymore.

-Goldilox

More western oil analysts are jumping on the bandwagon of suspecting a Ghawar decline.

http://www.urbansurvival.com/week.htmsnip:

My source, a highly respected oil industry consultant, goes on to advise me that "If true, it is not unexpected, and it means that the two largest producing fields in the world are crashing. BTW, the Saudi stock market crashed earlier this year because of heavy insider selling by the Saudi royal family. Ghawar + Cantarell crashing means explosive increases in oil prices."

So, if you look at the prospect of $200 oil, the Chinese cutting supply deals with Iran, and the Russians buying them nuclear development materials, it means that Iran (which will be putting out about 5% of the entire world's energy supplies as Cantarell and Ghawar production collapses will become an even more strategic asset. The clock is running on an energy-driven die-off and the neocons and a lot of others know the hour is late and, as energy banker Matthews Simmons has said so many times, the West doesn't have a "Plan B."

Bottom line: If the water-injection to Ghawar is causing it's sudden death right now (as leading researchers like Chip Haynes have been warning of since 2001) then the US is quickly getting into a corner and instead of using what we have lots of (brains) and anticipating the worst case (like a crash alternative energy program) we're trying to take the military solution, ignoring the fact that such tactics use tons of energy and wreck the planet along the way.

-Goldilox

George Ure's take on the ramifications of Saudi production decline. I would tend to agree that a "Manhattan Project" level effort in the energy sector is critically more important than the admin's paltry $10M investment in alt energy research.

Hmmm. . . $10M vs. $450B in Iraq. I wonder which alternative the admin is "banking" on?

I've heard that there is an oil field larger than Ghawar, under Ghawar in older Permian rocks and capped with shale. This from a relative, a geologist with a service company involved with analysis of drill samples. FWIW. Should radical Islam take over this region, there may be no option but war. It's past time to drastically cut our use of oil.

In perusing the news of late, I can't help but notice distinct departures from the reporting the last time rockets fell on Israel. In the past, there was no doubt as to the source of armaments used against Israel. They were definitively Soviet manufactured SCUD variety.

Why do we see no specific information on the source/manufacture of these Hezbollah rockets. We are led to believe they are ultimately from Iran which is rumored to be the main weapons/financial supporter of the Hezbollah political faction.

How is it possible for these rockets to be supplied by Iran? When I look at the map, the supposed supply line runs directly through US occupied Iraq. Are we to believe that a thousand missles somehow are transported through the same border control points that won't even allow passage of an Italian diplomat? If they are not, would'nt the Hezbollah be running out of rockets to fire at Israel soon?

Or perhaps they were sent by ship into Beirut, Lebanon all the way around the world or south of South Africa and through the straights of Gibraltar undetected? Maybe they are all the missing Iraqi rockets that supposedly disappeared into Syria from Iraq in the early days of the latest invasion (Oh wait, that is such a strong term, intervention is so much more suitable)? If so would they not also be of the SCUD variety? So what kind of rockets are these anyway? Are we to believe that it is not known what type of weaponry this is?

Why would Israel and Hezbollah stop their hostilities just because a UN committee drew up a plan for it? Do Hezbollah or Israel even recognize the authority of a UN.
I suspect the answer is like always, only when there is something to be gained. Will the US threaten to withold financial support to Israel if they do not comply? Doubtful at best.

Perhaps they do come from Iran. If so, and the US is concerned about Iran lobbing its missles at oil tankers passing through the straits of Hormuz, then every missle fired at Israel is one less fired at an oil tanker. Perhaps this will go on fo a very long time.

The price of oil headed for $200/barrel?

And the Price of gold? It is already priceless.

There is no way we can discuss the war on terror, especially since 9/11, without bringing politics and religion into the mix. Surely all these things are affecting the USD and the POG, but it is difficult to debate these matters because it seems that everyone has his or her own preconceived positions and are all unwilling to consider that anyone else's point of view has any validity. It would be interesting to have this discussion but this forum has decided, and rightly so, that personal, political, and religious opinions are out-of-bounds. White Hills

@Knallgold msg#: 146231 � It's interesting to see this call to action of not using the US dollar, but rather other currencies, in order to put pressure on the US policy (in whatever form it takes). I see the intent as positive, but the advice as misleading. In order to place pressure on how the US policy is handled around the world, one should reallocate savings into gold AND treat it as an international currency. Gold is an asset rather then a debt, thus once the transaction is complete, you have settled in full.

On this topic, Sir Goldilox's message #146242 seems to be in agreement with my point of view.

@Gold Finger's message 146261. Hum� Power hedgers and gold security. I suspect that you might already have found your security through the act of buying physical gold, but I would like to add my couple cents here just for grins. My observations of the different markets lead me to believe that speculation demand in the paper markets is countered by paper supply liquidity. Looking at this backwards, if a paper seller comes to market a paper buyer will want to hold the contract. As long as there is a huge demand for paper contracts, the price is balanced at or just above manufacturing levels for metal. Thus, if the hedge funds buy the correct paper, balance can be maintained with regards to metal price.

At this point (in my understanding), I don't really see this as a bad thing. Let those that manage keep on doing so and what we'll see is that the physical demand will require that gold be mined from the ground while inflation is climbing all around us. As inflation (of the currency supply) drives up prices, the relative price of gold will go up. If not, it will not come out of the ground. On top of that, as more people loose confidence in paper, demand for hard assets will continue to increase. Time is on the physical gold holders side.

Smeagol (msg 146265), good to see you again. Your dual perspective is unique, but your expressed thought is not the first thought that comes to me. If you remember, the precious held in Iraq was in hoards. That is easy for the taking. What we read about Iran is just the opposite. If precious is dispersed amongst the people, it walks. If the people hold enough of it, losing a house is not the end of the world because what you have in your pocket will buy you another one in safer lands. We should watch this development closely for it may become more widespread � learn from others mistakes/good fortune.

@MK message 146269 � yes, but only is security is lost. I look at it this way, you can sell guns to everyone, but if there are no bullets the guns are less then effective.

@MK message 146304, strong dollar vrs currency values. I would love to understand this concept fully, but it has been my understanding that the Strong Dollar policy relates to commodities not currency. Thus Paulson's statement would say that it's in the best interest of the US to continue to hold down commodity prices relative to the US Dollar and then let the US Dollar value be determined in the open market against all other currencies. I may be naive, but I read in this message that the US has no other alternative then to continue fighting for reserve currency standard at all costs. Without a strong dollar, the world will turn to gold. � Ah, TownCrier's message #146320 clearly addresses what I believe is the heart of the matter.

@Waverider's message #146334 � why would Russia trade oil for Euro's when they can trade oil for Rubles?

I'm of the opinion the war on TERROR (war on>>>>>DRUGS, inflation, welfare, genocide, food depravation��..scandals, crisis's, disasters, loss of liberty, CONSTITUTION revisionists, ect at infinitum)��.is a neo economic issue CLOAKED in religion, MASKED by political marauding, eleven ring circus conductors.

At the very least, the NEVER ENDING, SUPPOSED war on "terror" will ultimately label many fine FREE, non forfeiting "AMERICANS" as TREASON EST's ���.Correct founding fathers??????����HELLO STALIN�����AMF

There are two distinct camps in the goldbug camp as to what will happen on the Comex and other futures markets when the real physical gold runs out.

On one hand we have the separation of paper and physical as told by Another/FOA such that the price of paper will fall, while physical becomes virtually unobtainable. When it is traded again, It will be at a dollar price many times what it is now (or the dollar will only be worth a small fraction of its present value, depending on your point of reference)and paper contracts will be worthless.

On the other is the "orderly market" approach, where the paper contracts will increase their (paper) value, but will be limited to cash liquidation in a giant short squeeze.

It occurs to me that there might be a third path somewhat between the two, which may be playing out at the moment in the Comex silver market. Here, the registered stock has been steadily eroding for some months now (as reported by Midas), and the physical deliveries are up. If this continues, we should see a diminution of the open interest as there will be fewer shorts willing to sell a contract knowing that there is a growing risk of having to deliver real metal. The futures market would morph into a physical one - freesilver anyone ? If this happened, gold wouldn't be far behind.

The fly in the ointment is what would happen to all the derivative sewage ? Could it be that the gold would continue to flow, but the explosion would be in the derivatives, whose effective value would go to zero. This would be far easier for the banks to contain - remember Refco ?

OK. Now shoot me down in flames !

C!

http://observer.guardian.co.uk/business/story/0,,1838081,00.htmlFed admits US recession on cards

Heather Stewart, economics correspondent
Sunday August 6, 2006
The Observer

SNIPS
The United States faces almost a 40 per cent chance of slipping into recession in the next 12 months, according to the Federal Reserve's own market model.
+
After official payroll figures released on Friday showed that the economy created fewer jobs than expected last month, Wall Street began predicting Bernanke would halt the Fed's rate-hiking campaign this week. But some economists believe the central bank has already gone too far.
+
Predictions of a US slowdown came as analysts warned that the Bank of England's surprise rate increase on Thursday will cramp retail spending and wobble the vulnerable housing market - especially if consumers believe there are more rises to come. 'I wouldn't dismiss the impact of this; people have been lulled into thinking that rates don't move, and there will now be a period of reassessment,' said Jonathan Loynes, chief European economist at Capital Economics.

http://www.reagan.utexas.edu/archives/speeches/1988/031888d.htmEO 12631, (aka the PPT order)

http://www.reagan.utexas.edu/archives/speeches/1988/88mar.htm

http://www.reagan.utexas.edu/archives/speeches/1988/031888e.htmInteresting tidbits to read what the press was fed on that day regarding the issue.

SNIP:

March 18, 1988


In view of the extraordinary events in the financial markets in 1987 and the findings of the numerous market studies, including studies by Federal agencies, self-regulatory organizations, and the President's Task Force on Market Mechanisms, it is clear that further, closely coordinated work needs to be done. Despite our financial system's notable success in withstanding the shock of those events, we need to ensure that the public is protected by assuring financial integrity of the markets during periods of significant price changes.

END SNIP.

One wonders who did the "numerous market studies", and which Federal Agencies, etc... With protection like this, who needs free markets? Mr Fitzwater mentioned no names.

http://www.financialsense.com/editorials/sjuggerud/2006/0802.htmlJust a thought: if housing were to slump, the domestic demand for copper would ease up. Ditto for public works road building and steel and concrete.

There are numerous EO's regarding commodities use during war time. I am not sure that a public proclamation is actually required. Such things could be activated quietly. Unlike WWII when domestic consumption was stopped to allow military deployment, here domestic consumption would be managed downwards to save the markets: a recession in our "lifestyles" while paper asset prices remain high.

I have given thought to that manhattan project crash program, sir 'Lox. There certainly is a great deal of black budget money in the sysetem. Perhaps a severe lack of civilian motor fuel is part of the "containment plan"? All the while, the military maintains its mobility?

Something tells me that "da boyz" aren't that smart. Our only hope is that the backside of Peak Oil is not too steep initially.

Sir FL, how does the rise in the price of energy impact the paper price containment as ore quality declines and energy costs rise? Are there other discontinuities present? As Bakhtiari suggests, could there come a time when nitrate explosives are a trade off to nitrate fertilizers in south african agriculture? SA mines use great quantities of coal derived electricity, whereas Barrick's surface mining uses large quantities of diesel fired earth movers. Rather than "costs" it is a case of managing the price of gold to be just slightly higher than the energy price of production: it may not be a free variable for much longer, but wholly dependent on out of control energy markets.

Declining ore reserves may be irrelevant here. They will be left underwater.

I wonder, more than fertilizer, what is the point at which south africa "revalues" its coal, to such an extent that its gold mines are "unprofitable"? I guess that it is probably over the dead bodies of their anglo-alliance bankers. Though from a strategic standpoint, south africa is one of the few pro-western footholds in the continent.

Tom Dyson: Africa, the continent of the future. (yah, what the boojers said back in 1650.) If at first you dont succeed...

http://www.freebuck.com/bonds.shtmlBonds look a little more committed this time through as all maturities are now below the 3mo.

Will the Fed try to buck the trend and stand another hike?
Sir Al wouldn't've imo.

Comex Gold for Aug looks to be running on vapor here whereas Ag popped up with a nice little off-month del'y friday propelling her upward.
I recall some time ago calling A$ Au @ $900 and A$ Ag at $500 ...Ag now is $514 and Au is $841.
Quite the little out-performer is Aggie!

http://biz.thestar.com.my/news/story.asp?file=/2006/8/4/business/15032426&sec=businessHere's a two part article by a Bangkok-based independent policy and investment researcher, Stuart Larkin, under the title "Managing China's Forex reserves". The introduction to Part I, says that Larkin writes on the appropriate level for China's increasing foreign exchange reserves which will soon reach US$1 trillion, most of it invested in US Treasury bonds. The introduction to Part 2, which is titled "Single entity to manage funds", says that Larkin proposes an investment policy for the National Development Fund tailored to contribute to meeting China's national development objectives.

PART 1 link
SNIPS
Once foreign exchange reserves have satisfied the needs of imports, fluidity of capital and security, the surplus should be transferred to a National Development Fund (NDF), where greater attention can be paid to investment returns and national development.
+
Promoting the yuan as an international currency is not presently feasible since the fragility of the banking system precludes opening up the capital account of the balance of payments, a precondition for a flexible exchange rate system. (China describes its exchange rate system as a "managed float" but yuan behaviour suggests a de facto fixed exchange rate pegged to the dollar.)
+
Some Chinese economists are calling for an increase in the country's gold reserves, which have changed little since 2002, at 600 tons. They argue that gold reserves need to be quadrupled to 2,500 tons to their historic proportion of 3%-6% of total foreign reserves.
Perhaps gold's rightful proportion would be restored if reserves were drastically cut to establish a NDF dedicated to raising investment returns and promoting national economic development.
It should be remembered that gold, like stockpiles of other commodities, has no yield and that there are costs related to storage, security and insurance to be borne. And what are the prospects for capital gains when buying at a 25-year high?

PART II
http://biz.thestar.com.my/news/story.asp?file=/2006/8/5/business/15034643&sec=business
SNIPS FROM THE CONCLUSION
The NDF should be managed by a new financial institution that would become the world's largest fund management company. For reasons of management expertise, effectiveness of regulation and international acceptability, this institution would be in the private sector. Its establishment will result from Chinese entrepreneurs pursuing a legitimate business opportunity, using their preferential access to China's top policy decision makers to convince them of the project's merits.
+
Thus, the NDF shall help to meet national economic objectives through contributing to the development of the Chinese corporate sector, in which so much of China's future prosperity and stability hinges.

==

What seems to be proposed is that after the foreign exchange reserves have satisfied the needs of imports, fluidity of capital and security, the surplus should be transferred to a National Development Fund (NDF). The yuan should not be promoted as an international currency and gold should not be part of the Forex reserves.
ONLY NEGATIVES.
Instead the reserves should be managed. What's the purpose of Forex reserves again?

Here's what happened to China's neighbour, India
http://en.wikipedia.org/wiki/Forex_reserves
Forex reserves is a term used to refer to foreign exchange reserves in India. They are counted in US dollars. India's "forex reserves" recently passed the 100 billion US$ mark. [1] India has built up this reserve after an unpleasant incident in the early 1990s, when the country's gold reserves had to be pledged because of a balance of payments crisis. The current reserves are more than 130 billion US$.

Back to China's Forex reserves.

Larkin is based in Bangkok and like the Thai government, he is pro-US dollar.

He tries to guess why China continues to hold disproportionate dollar reserves.

The Chinese dollar reserves do not follow the rules of the dollar-IMFS (dollar-international monetary and financial system).

The author does not wonder why central planning of the Chinese authorities "continues" to deviate from these rules.

Is that because the wonder could result in some dramatic answers?

He continues to invoke the "mercantilism" of the Chinese/Asians. (Remember that Singapore is a Chinese enclave within Malaysia).

He wants to force exuberantly growing China to help the stagflatory west out of its structural debacle

We do not know who are the Chinese or do we?


U.S., China energy cooperation serves both interests: official
http://english.people.com.cn/200608/05/eng20060805_290079.html
The United States and China face similar energy challenges and their cooperation will serve interests of both countries, a senior U.S. official said Friday.


Production begin at Chunxiao gas field
http://www.chinadaily.com.cn/china/2006-08/06/content_657939.htm
CNOOC has said gas production had begun from an oil and gas field in the East China Sea, a territory that is the focus of a drawn-out dispute with Japan.

http://www.usagold.com/GoldTrail/archives/ANOTHER1.htmlhttp://business.timesonline.co.uk/article/0,,8209-2300386,00.html
SNIP
Nobody knows what is going to happen to the price of oil. But there are certainly those in the industry who think that the current high price for natural gas has been inflated by anxieties about supply shortages this winter, which would be eased if new pipelines are installed on schedule.

http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2006/08/06/ccecag06.xml
SNIPS
We hear much about global imbalances and the problem they pose for the world. In the popular mind these imbalances are essentially about trade between America and China.
America runs a huge deficit and China runs a huge surplus.
The popular view is right about the bare facts but the perspective is wrong. As our main chart shows, last year Opec ran a larger surplus than the whole of east Asia except Japan.
And once you add in two large non-Opec oil producers, Russia and Norway, the oil producers' surplus was bigger than the whole of Asia's including Japan]
+
These enormous surpluses are having a major impact on the world economy.
Essentially, income is being transferred from the oil consumers to the oil producers. Because the oil consumers tend to spend their income whereas the oil producers do not, this transfer potentially has a depressing effect on world economic activity.
+
What would happen if the oil producers did manage to spend their surpluses?

==

Were we not told Another story about oil producers spending their surpluses?

http://www.usagold.com/GoldTrail/archives/ANOTHER1.htmlANOTHER (THOUGHTS!)
Foundational Gold Trail Commentary
The Inside Story on the Gold-for-Oil Deal that could Rock the World's Financial Centers

http://observer.guardian.co.uk/business/story/0,,1838002,00.htmlGazprom's huge Venezuela gas deal alarms US

Conal Walsh
Sunday August 6, 2006
The Observer

SNIPS
Gazprom, Russia's state-controlled gas company, is risking a diplomatic row with the United States over a mooted multibillion-dollar pipeline investment in Venezuela.
The Russian gas giant is close to a deal on the project, according to Venezuela's firebrand President, Hugo Chavez, who has led opposition to US influence in Latin America.
News of the possible tie-up follows Gazprom's recently declared interest in investing in Bolivia, another regional enemy of the US, and is the latest sign of Moscow's deteriorating relationship with Washington.
It comes after the Russian President, Vladimir Putin, failed at the G8 summit in St Petersburg in July to secure American support for its entry to the World Trade Organisation
+
The US and Russia have also disagreed over human rights and Iran, and the prospect of a state-backed Russian company entering the western hemisphere is likely to jangle many nerves in Washington.

http://www.newsmax.com/archives/ic/2006/8/4/210342.shtml?s=ic
Venezuela's U.N. ambassador tells NewsMax that President Hugo Chavez will not use oil exports as a weapon against the Bush White House for support of Israel's confrontation with Hezbollah.
+
The ambassador also told NewsMax that despite "sympathies" for Hezbollah, the Venezuelan government has no intention to provide any suppport (financial or political) to the Lebanese terrorist group.

http://www.easybourse.com/Website/dynamic/News.php?NewsID=36130⟨=fra&NewsRubrique=2
LONDON -(Dow Jones)- Saudi Arabia has ruled out using oil as a weapon if the conflict between Israel and Lebanon escalates, Saudi Foreign Minister Prince Saud al-Faisal said, the official Saudi Press Agency reported early Thursday.

Now read this carefully:
Last Updated: Sunday, 6 August 2006, 09:30 GMT 10:30 UK
http://news.bbc.co.uk/2/hi/middle_east/5249810.stm
Iran has vowed to pursue its nuclear programme, in its first official response to last week's UN resolution urging it to curb nuclear activities.
Chief nuclear negotiator Ali Larijani said Tehran would continue to develop nuclear energy within the framework of the Non-Proliferation Treaty (NPT).
+
Further discussions
Mr Larijani also warned that sanctions would hurt the West more, leaving people there shivering from cold during the winter because of higher oil prices.
The UN Security Council passed resolution 1696 by 14 votes to one on 31 July.
It gives Iran until the end of August to suspend uranium enrichment and open its nuclear programme to international inspections.
If Tehran fails to do so, the council will consider economic sanctions.
But following objections by RUSSIA and China to the specific mention of sanctions, further discussions will have to take place about what further steps to take.

==

What does this mean?
"Mr Larijani also warned that sanctions would hurt the West more, leaving people there shivering from cold during the winter because of higher oil prices."

Here it is
http://www.abc.net.au/news/newsitems/200608/s1707538.htm
Mr Larijani has also warned against imposing sanctions on the world's fourth biggest oil exporter.
"If they do, we will react in a way that would be painful for them," he said when asked about what would happen if the UN Security Council passed sanctions.
"They should not think that they can hurt us and that we would stand still without reaction," he added.

http://www.theinternationalforecaster.com/ptrainwreck.php?Id=134By Bob Chapman

snippet:
Anyone who doesn't believe gold and silver are going much higher is just plain dumb.

It is the train wreck of the century. Happening now in Lebanon and Iraq. No one will accept paper fiat from these murderers. The price of gold is headed to the moon Alice, to da moon.

A "Hard Currency" may be defined AS A CURRENCY IN WHICH INVESTORS HAVE CONFIDENCE, such as that of an economically and politically stable country.

Since Bretton Woods, the United States Dollar has filled that role by being the de-facto world's reserve fiat currency. But even our own illustrious(?) and normally cryptic Alan Greenspan was exceedingly clear in his remarks before the World Bank Conference on Recent Trends in Reserves Management, Washington, D.C. on April 29, 1999 that gold is superior to the USD when he said,

" Arguably, immediately following the dollar's float in 1973, U.S. authorities did not intervene and left it to others to adjust their currencies to ours. We did not sense a need to hold what we perceived to be weaker currencies in reserve because presumably we could always purchase them in the market, when, and if, the need arose. WE HELD SIGNIFICANT RESERVES IN ONLY THAT MEDIUM WE JUDGED A "HARDER" CURRENCY, THAT IS GOLD." (emphasis added)

and reiterated in May, 1999.

"Gold still represents the ultimate form of payment in the world. Fiat money in extremis is accepted by nobody. Gold is always accepted."

While we remain relatively stable geopolitically our economic (fiscal) condition is increasingly being called into question with our burgeoning and unsustainable budget and trade deficits.

This week brings Another trade deficit report. How do you think we will fare?

Noble1

P.S. I hope that his use of the past tense "HELD" in the first quote represented time and not substance.

I have never seen that quote before and consider it exceedingly important. I only hope that as the years pass we do not see the Greenspan view as an anomaly.

http://news.bbc.co.uk/2/hi/business/5250250.stmLast Updated: Sunday, 6 August 2006, 14:09 GMT 15:09 UK
The shock rise in UK interest rates last week has sent the pound jumping higher against the dollar and other currencies, a trend that may continue.
SNIPS
Sterling rose more than two cents to $1.91 on Friday, a 15-month high.
Analysts think the pound could near the two-dollar mark in coming months as investors pile into the currency.
+
Currency traders have been switching their reserves out of the dollar in the belief that the Fed may hold steady, or if it does raise rates again, signal that it will stop there.
+
If the pound does pass the $2 mark, currency experts believe it will be a reflection of the dollar's weakness across the globe.
China has gigantic reserves of foreign currency, much of which is held in dollars.

http://news.bbc.co.uk/2/hi/business/4772049.stm
Last Updated: Monday, 15 May 2006, 22:27 GMT 23:27 UK
SNIPS
Behind the problems of the dollar lies the huge and growing US trade deficit, and the large Federal budget deficit.
A fall in the greenback could hit Asian countries whose governments hold huge foreign currency reserves in dollars
+
Now the markets are beginning to take matters into their own hands, by forcing the US dollar down.

CONFIRMED
http://www.guardian.co.uk/iran/story/0,,1838645,00.htm
Iran threatens to use 'oil weapon' in nuclear standoff
� Energy crisis would leave people 'shivering in cold'
� UN deadline looms for Tehran to accept deal

Simon Tisdall in Tehran
Monday August 7, 2006
The Guardian

SNIP
Speaking in Tehran, Ali Larijani, the country's chief nuclear negotiator and head of the supreme national security council, said Iran would be reluctant to cut its oil exports. "We do not want to use the oil weapon. It is them who would impose it upon us."

I also consider the quote about thinking of the gold standard with "nostalgia" as equally important. Of course, we now have a Fed chairman who has formulas running through his head like the window in "A Beautiful Mind." Central banking and currency management is an art not a science. Targeting inflation is akin to targeting sunspot cycles. The answer is here and then it is there. I suspect we go on hold on interest rates next week with consequent results in stocks, bonds and gold. Targeting a phony number is like targeting a phony philosopy. It only gets you in hip deep. Then you have to actually do something. We shall see what he does and that will become the subject of intense analysis as this chapter of financial history unfolds.

Alan Greenspan's retirement, in my view, will mark the end of an era. The deterioration in the MidEast is part and parcel of its end.

I would have you note that in most instances the door is left open. Saudi Arabia come to the White House with a peace plan. It was rejected. A few days later the Arab children were killed in Qana. They will not be happy about that. To use diplomatic terms, this situation is "fluid." If the United States and Europe are unable to rein in Israel (and that seems unlikely), the moderate Arab states may be forced by their collective citizenries to do something. What alternatives do they have? What weapons at their disposal? What is today may not be what is tomorrow. Even Venezuela's comments are hedged. Check the record.

http://money.guardian.co.uk/interestrates/story/0,,1838851,00.htmlLarry Elliott, economics editor
Monday August 7, 2006
The Guardian

SNIPS
Last week's [surprising decision Bank of England's decision to raise interest rates] was based on more than just habit. Interest rates are going up around the world. The European Central Bank tightened policy on the same day as the MPC [Monetary Policy Committee of the Bank of England]; the People's Bank of China is putting the brakes on the world's fastest growing economy; the Bank of Japan has just ended a long period of zero interest rates designed to tackle deflation; and the Federal Reserve has ratcheted up the cost of money in the United States by a quarter-point at each of its last 17 meetings. The 18th successive increase may come this week, depending on whether the Fed is more concerned about rising inflation or weaker growth.
+
Overcooked
The fact that the tripling of oil prices has had so little effect on growth may reinforce the feeling among policymakers that they overcooked things by leaving rates low for so long.
The second point is that markets have a naive belief in the infallibility of policymakers. This is ironic, given that the prevailing philosophy among policymakers for 25 years has been in the infallibility of markets, but there we are.
+
But there is a third difficulty. Assume the markets are right: the tripling of oil prices does have an impact; the Middle East remains in turmoil; central banks have timed to perfection the moment to remove the punchbowl from the party; growth slows everywhere and inflation abates. And then what?

==
You guessed it.


==

On Another subject
"Targeting a phony number is like targeting a phony philosopy. It only gets you in hip deep. Then you have to actually do something. "(MK)
"Maybe it hurts so much that I don't even know I'm hurt. But I don't think so . . . I'm not capable of suffering completely. I never have. It goes only down to a certain point and then it stops. As long as there is that untouched point, it's not really pain." (Ayn Rand)

Maybe, the Rand quote fits overcooking, but perhaps it has not the same meaning as Michael's quote. Sorry, if the latter is the case.

Look at the destruction. Have you no soul? Karma will enact her revenge. Buy gold, you may as well wipe yer arse wit da USAF.

my appologies to the USAF.

Sir GF wrote earlier today:

"It is the train wreck of the century. Happening now in Lebanon and Iraq. No one will accept paper fiat from these murderers. The price of gold is headed to the moon Alice, to da moon."

Maybe I don't have the big picture, but uf the fiat in these countries is devalued (or worthless), wouldn't they use US dollars gotten from oil sales before gold (keeping the more valuable hard currency in reserve)?

Why am I kept under such a close watch here? I have seen others post much the same comments and not be attacked. Why me?

http://www.timesonline.co.uk/article/0,,2089-2300773,00.html
August 06, 2006
DAVID CRACKNELL AND MARIE COLVIN, TYRE

HOPES rose for a peace deal in Lebanon yesterday after the American and French governments reached agreement on a United Nations Security Council resolution.


http://news.bbc.co.uk/2/hi/middle_east/5249972.stm
Last Updated: Sunday, 6 August 2006, 23:18 GMT 00:18 UK

At least 15 people have been killed in a barrage of Hezbollah rocket strikes on northern Israel. Twelve reservist soldiers died in an attack on the town of Kfar Giladi. A number of rockets later landed on the Israeli port of Haifa, killing three people and injuring dozens. Reports said at least one building collapsed.
Meanwhile, the UN is debating a draft resolution on the crisis, demanding Hezbollah halt all attacks and Israel stop all offensive military operations.
+
The UN draft resolution, agreed after much debate between France and the US, calls for a "full cessation of hostilities". But Syria called the resolution text a "recipe for the continuation of the war" and the Lebanese representative at the UN, Nouhad Mahmoud, said he had submitted an amendment calling for Israeli forces to withdraw from Lebanese territory.

==

Nay the TRUTH prevail!
Yes, it (either way, the war and/or the oil embargo) will VISIBLY cost many lives now.
But how many lives were INVISIBLY destroyed by the gold-lies and other lies?

Let's paraphrase Henry Hazlitt again. He wrote:
"The art of economics consists in looking not merely at the immediate but at the longer effects of any act or policy; it consists in tracing the consequences of that policy not merely for one group but for all groups."

Yes, this is very painful, but pain goes only to a certain level, as I quoted Rand in my previous post.

General cleaning after AG, said somebody some posts ago.

Yes, I am angry young( 44?) man!

http://abcnews.go.com/Business/wireStory?id=2280814&business=trueSnip: ANCHORAGE, Alaska Aug 6, 2006 (AP)� BP Exploration Alaska, Inc. began shutting down the Prudhoe Bay oil field Sunday after discovering unexpectedly severe corrosion and a small spill from a transit pipeline.
....
Company officials said it would take days to shut down the oil field. Once completed, it's expected to reduce oil field production by 400,000 barrels a day.
....
"We regret that it is necessary to take this action and we apologize to the nation and the State of Alaska for the adverse impacts it will cause," BP America Chairman and President Bob Malone said in a prepared statement.
(end snip)

After re-reading my post on the possbility of an oil embargo, I fear that you may take it as a criticism. It is not meant to be. I simply want to make the point that what some might say publicly may bely what is going on behind the scenes. Sometimes my posts come off a little harsher than they are intended. I think it is important to note that most of the statements on a possible embargo were hedged. . .

ANCHORAGE, Alaska - Half the oil production on Alaska's North Slope was being shut down Sunday after BP Exploration Alaska, Inc. discovered severe corrosion in a Prudhoe Bay oil transit line.

http://www.federalreserve.gov/boarddocs/speeches/1999/19990429.htm
The speech is short and worthy of a read by all.

Noble1

http://www.businessweek.com/ap/financialnews/D8JB76280.htm?sub=apn_news_down&chan=dbSnip: AUG. 6 6:54 P.M. ET The government of Dubai will assume control of its offshore oilfield operations next year under a deal announced Sunday.
ConocoPhillips said its Middle East unit Dubai Petroleum Co. will cede control of the fields to the government's Dubai Petroleum Establishment effective April 2, 2007. The state will then be in charge of all offshore oil and natural gas production.

"DPC would like to thank the government of Dubai for the unique opportunity we have had to be involved in the growth and success that Dubai has experienced over the last 40 years", said Bill Arnold, president, Dubai Petroleum Co. "DPC will do its part to successfully facilitate the handover of the operations to the government."

"This relationship has served Dubai well over the years and we are grateful to ConocoPhillips, Total, Repsol YPF, RWE Dea and Wintershall for the role they have played in building the new Dubai," said Abdulla Abdul Karim, Dubai government representative.
"Forty years later, it is clear that production will now far outlast the period of the concession agreement, and all parties agree that it is appropriate to initiate a transition of operatorship to the government at this time and to begin a new era." (end snip)

So do we a have a tit for tat here? We disallow the sale of port operations and Dubai disallows the US operation of their hydrocarbon reserves. OR is it something more? A continuation of a trend to nationalize reserves and their operations, as might be construed by the quote: >>>>"Forty years later, it is clear that production will now far outlast the period of the concession agreement, and all parties agree that it is appropriate to initiate a transition of operatorship to the government at this time and to begin a new era."<<<< Either way, it raises the question; has globalization reached its elastic limit? And can we expect to see nations attempt to enhance their sovereignty by reclaiming assets of REAL value?

No problem. It's only by criticising each other that the TRUTH can appear or arise.
You criticize me, I criticise you. And so we advance.
Unfortunately (the rest (and thus whole) of his philosophy, which was adopted by Karl Marx, is disgusting), it was Hegel who spoke about thesis, antithesis and synthesis.

I certainly didn't read any kind of attack from Titan. Just a timely reminder of Gresham's Law.

http://news.yahoo.com/s/afp/20060806/ts_afp/zimbabweeconomybankmoneyinflationZimbabwe's Monetary Reforms Disparaged as 'Cosmetic'

By Fanuel Jongwe
Agence France-Presse
Sunday, August 6, 2006

HARARE, Zimbabwe -- Zimbabweans last week flooded banks to hand in old notes after the central bank slashed three zeroes from the local currency, but analysts said the new money would not provide relief from record inflation.

Zimbabwe's Reserve Bank slashed three zeroes from its currency last Monday to help consumers battling with bundles of money on shopping trips which can cost billions and trillions of local dollars.

The change, which ushered in a new currency, is also aimed at compelling individuals and companies to bring in billions of dollars stashed away in safes and combatting a burgeoning black market in currency, central bank chief Gideon Gono said.

Since Monday state television has been screening an advertisement in which an ecstatic housewife hails the currency change saying a loaf of bread which cost 200,000 Zimbabwe dollars "now costs only 200 dollars."

Independent economist John Robertson told AFP: "The currency change is a purely cosmetic exercise which won't overcome the problems facing the country.

"It will only work as far as reducing the volumes of bank notes people will carry but it does not provide solutions to the main problems of inflation, lack of investment, and high unemployment."

Best Doroh, an economist with a leading bank, said the currency change "does not entail an immediate reduction in the prices of goods and services.

"Availability of basic commodities will also not necessarily improve. Inflationary pressures will most likely remain alive in the economy."

Zimbabwe is in the throes of an economic crisis characterised by world-record inflation hovering over 1,000 percent, high unemployment, and chronic shortages of foreign currency and basic goods like fuel and cooking oil.

At least 80 percent of the population lives below the poverty threshold often skipping meals and walking or cycling long distances to work as they battle to stretch income to the next payday.

Economist Eric Bloch lauded fiscal and currency reforms introduced by Gono, however, saying they would reap rewards in the long run.

"The benefits will not come overnight," Bloch said. "But the government must refrain from printing money and financing its projects. The governor also did well to remove subsidies which have contributed greatly to inflation."

Zimbabwe started printing high denomination bearer cheques, a bank note equivalent, following cash shortages which saw banks running out of cash and customers waiting long hours for cash deliveries.

As hyper-inflation struck, millions became "millionaires" overnight carrying wads of notes to buy groceries.

The central bank gave a 21-day ultimatum to hand in the old bearer cheques and imposed thresholds on amounts that can be deposited in banks in an apparent crackdown on hoarders.

Those found with cash exceeding the limit will have to reveal the source or forfeit the money and face prosecution for money laundering.

Shopowners have also been barred from accepting cash payments of more than 100 million Zimbabwe dollars (400 US dollars) for goods and services.

Critics say the currency reforms were a psychological ploy to hoodwink ordinary Zimbabweans into believing prices had gone down.

"The government wants to create the impression that goods are cheaper which is not the case," said a taxi driver in central Harare.

A Harare-based economic think tank, KM Financial Solutions, said unless President Robert Mugabe's government changed its economic policies, the country would keep on playing with the currency.

"One also hopes that the government will be able to fuel the functioning of the economy since most of the fuel was being financed by black market dealers," another analysts said.

The government blames the country's economic woes on sanctions imposed by Western countries four years ago while its critics say the economic downturn is a result of corruption and mismanagement.

Sir melda laure, you pose good questions that require much thought.

At this point, I must say that your questions have broadened my point of view ever so slightly (in a positive way). It would seem that managing the price of gold just at, or above, the cost of production may not be the goal in the bigger picture of things. I'm now leaning more towards price containment as being directly targeted towards the speculator and demand reduction.

Half my thinking makes reference to the airline industry. As everyone knows, US airlines that took the �free� money provided to them a few years back to hedged their fuel bills are now flying with profit. Those that did not, are having a harder go at it. Also knowing that big miners already understand hedging, one could assume that they would not only sell gold forward, but also buy energy forward too. Thus, if they've played at all, they will have the bulk of their expenses known ahead of time. Profit will most likely still be there for them. It only makes sense that when the miner signs a contract to deliver, they will lock in profits for years to come regardless of the future price of energy � as long as they bought energy contracts to go along with the delivery contract.

The little guy and the explorer may find it hard during these unstable times, thus new discoveries may be harder to come by.

If the real delivery works off contracts that balance out like this, one would have to look twice at the price containment with respect to production costs on miners. Rather, there is something else that might be driving the price containment of gold.

The archives here are full of postings that talk about the utility of physical gold and its importance to big traders. If it really is important for physical gold to flow to the appropriate destinations, then competition at the mine must be kept to a minimum. At least, you wouldn't want everyone and their brother lining up at the door looking for an oz or two. To keep everyone away from the doorstep, one would want to do everything they could to reduce physical demand. We see that today with paper plays that soak up currency and relieve demand for physical.

So where can the price go?

It seems to me that with the strong dollar policy, all those little guys that are ahead of the 8-ball are taking advantage of it converting some small portion into metal. Also, anyone that has kept up on the outstanding claims against gold will find that the claims for physical significantly out pace the current supply. Thus, raising the price will slow physical demand extending the game ever so slightly. But, raising the price too much will trigger speculation from investors that would seize it up ending the game. So, the slow rise in price of gold might be an effort to extend the use of the US Dollar as the world reserve currency. If they go slow enough, the dollar is devalued (against gold) and demand is reduced on a worldly scale while speculation is kept to a minimum.

So, will high energy costs really make a difference with the price of gold? I'm leaning towards � not as much any more. (also, recycling doesn't seem to take a lot of energy.)

Will gold be managed at or just above the cost of mining? That doesn't make sense any more either. It would seem to me that gold must continue to flow but demand from speculators must be reduced � In other words, the average Joe must work harder to get it � thus the price goes up ever so slightly.

Fundamentally, physical demand can be reduced by raising the price � or letting the strong dollar slide just a little bit. The US dollar is not so strong, in gold, any more. If this idea holds, one could only conclude that we'll be seeing higher gold prices until demand comes back inline with supply so that the fiat game can continue to be played.

Running just a little further, if 1% of the world population buys gold and it consumes X tonnes, then doubling the price while keeping interest contained to that same 1% of the population will cut demand in half. Thus, if you are in that 1%, you might find the dollar price of your metal going up specifically to try to reduce demand. But watch out, if the price goes up to fast that 1% will grow creating a condition that will have completely the opposite affect on demand. (that is a good thing for must here in the forum.)

Does anyone have a realistic scenario (not nuclear war, alien invasions or fountain of youth situations) that might show a case for reduced demand for physical gold where the price in US Dollar terms would actually go ... down? I still can't find one.

How easily those four words slide off our fingertips eh FL? However, a more complex pair of "variables" it would be hard to muster up.
Firstly the Dollar is numero-uno on the Currency front and it's strength/weakness is subjectively discussed the world over. The relative strength of a Dollar can and is changing in response to miriad influences (some even man-made) that may see it's "strength" increase.
Then Gold, real Gold, Paper Gold, 3mo Gold, 5yr Gold, etf Gold ...etc.
We all have our own personalised idea of what constitutes the "Price" of "Gold" and I'd like to suggest to you that a prolonged fall in the "Price" is simply a matter of circumstance.
The reason main street it so smitten with Gold at present is simply that it's price is going up. Largely they have not faced and examined the prospects of the Dollar and what it's possibilities are as we move forward.
That's a whole other kettle of Fish that can and will influence $/Gold.

http://www.gata.org/node/4296Latest GATA dispatch.

To subscribe to GATA's dispatches, go to ...

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... and use the "Join Mailing List"
mechanism at the right side of the page.

Sir Flatliner, I wanted to respond to your latest comments, but after writing several responses to the issue I realized that it is a bit more sticky than I realized at first.

I think we are already past peak gold.

That was the only uncomplicated fact that seems to be clear. I do not have the feeling of any analytical foresight here, so I will stop. Yes much thought indeed, it may take some days... Your first analysis is quite good.

Sir MK, a genuine oil crunch could do a lot of Bernanke's dirty work for him, provide political cover, and so on. We have a multicultural assortment of scapegoats ready, we just need a competent pistolero to kill the archduke. It might even give us a gold sale.

http://stockcharts.com/h-sc/uiMentioned yesterday Ag's out-performing Gold at present, this Chart spots the trend.
It's quite remarkable how Gold is performing this year, clearly not a Commodity a-la Silver ...not a Currency a-la Euro ..then WHAT?
I'd like to suggest Gold is mimicing Dollar ...because it's vying for Reserve Currency Status ...as a final metamorphosis to FreeGold ...meybee!!

http://stockcharts.com/h-sc/ui?s=$GOLD:$SILVER&p=D&st=1990-01-01&en=2006-12-23&id=p44105871339eom

http://www.interfax.ru/e/B/finances/26.html?id_issue=11567261MOSCOW. Aug 7 (Interfax) - The money supply in the Russian economy that can be used as payment (money outside banks and demand deposits in the banking system, not including government deposits) grew a tentative 6.5% in June to 4.479 trillion rubles from 4.205 trillion rubles, according to information on the Russian Central Bank's website.

In January-June this indicator increased 16.1%, from 3.859 trillion rubles at the start of the year.

^---(from url)---^

Whether you take the bother to annualize those or not, those are remarkable figures for the growth of, effectively, the Russian "M1" money supply.

Additionally, the corresponding periodic figures in the marginal component of "M2" rose by 4.2% and 13.8%, respectively.

I hope everyone remembers last weeks missive on the difference between mere money and meaningful wealth.

A review of the current Zimbabwe monetary situation should greatly help to reinforce that important distinction.

Have you chosen your form of savings wisely?

R.

http://www.canada.com/ottawacitizen/news/story.html?id=d9e3e3a5-608a-4695-af44-7e43d89ae960SOFIA, Bulgaria - A golden dagger dating to 3000 BC, plus 500 golden ornaments, have been found in a Thracian tomb in central Bulgaria, an archeologist said yesterday.

^---(from url)---^

Not to overlook the more significant elements of this discovery, but a quick point is in order. The purchasing power -- the wealth component -- of these golden items has survived this triavel through the ages. Can you think of any contractual financial instruments that could have fared as well after so long a trip?

It seems to me that anything that could be such a reliable companion for a journey of five thousands is surely a good companion too for any shorter span of intermediate steps along the way. In other words, gold works as well in your vault during a lifetime as it does in the tomb-to-museum cycle spanning many millennia.

To be sure, certain bullion banking operations have done their duty to try to take the shine off of gold's value in the present age, but that, too, is only but to be likened to a brief covering of dirt -- to be swept aside all in good time like the unearthing of an ancient tomb to reveal unimaginable, priceless wealth.

R.

http://usa.mediamonitors.net/content/view/full/33793melda laure said in today's msg#: 146420
"I think we are already past peak gold."

We are not only past peak gold.
We are past the necessity to look for means to break the dollar.

Mon, 07 Aug 2006 01:05:42 -0000
[GATA] James Turk: The dollar weakens further

The Invisible Hand (8/6/06; 19:21:24MT - usagold.com msg#: 146400)
Sterling heading for $2 barrier
http://news.bbc.co.uk/2/hi/business/5250250.stm

Still, the linked article says
SNIP
Since the Saudis are a party to the dollar conspiracy, a grass roots boycott of the dollar will have the additional benefit of bringing the "oil for dollar" issue to the Arab public square.
UNSNIP

After almost 60 years of divide and rule by Israel, the Middle East does not need any embargoes (boycotts) as a temporary solution to their suffering.

Quite to the contrary. Any brutal boycott of the dollar would be counterproductive for the present euro-freegold-transition-process.

As most people cannot see this change which is happening before their eyes,
let alone that they would know that this euro-freegold-transition-process involves a STRUCTURAL CHANGE,
they continue to utter the same nonsense and hatred they always utter when the Middle-East is on fire.

Six decades of dollar hegemony will not be broken by a boycott or an embargo,
but by the construction of an ALTERNATIVE STRUCTURE or alternative concept, freegold.

All forms of senseless (based on military logic) escalation indicate the growing impotency of the standing dollar dominance.

9/11 was the start of this evolutive escalation (impotency of the dollar)

http://www.bloomberg.com/apps/news?pid=20602096&sid=aNPDE6FpRM14&refer=world_currenciessnip:

Aug. 7 (Bloomberg) -- RBC Capital Markets Inc. pared its forecast for a decline in the Canadian dollar because the currency will be supported by a demand for commodities.

Canada's dollar has fallen 1.9 percent in the past three months as the country's economy showed signs of weakness and the Bank of Canada halted its streak of seven consecutive quarter- point interest-rate increases in July. The currency reached a 28- year high of 91.44 U.S. cents on May 31.

``The risk is that global, ex-U.S., growth remains surprisingly resilient as do commodity prices,'' Matthew Strauss, senior currency strategist at RBC Capital, said in a phone interview on Aug. 4. ``We're still expecting weakness in the Canadian dollar, but that weakness may come later than we had anticipated.''

Canada's dollar traded at 88.86 U.S. cents at 8:10 a.m. in New York, from 88.71 U.S. cents on Aug. 4. One U.S. dollar buys C$1.1260. Trading is closed today in Toronto for a holiday.

RBC expects the U.S. dollar will gain to C$1.21 in the fourth quarter of 2007 instead of the second quarter next year, which it had predicted in May.

RBC Capital has advised selling the Canadian dollar since September.

Declines Predicted

Morgan Stanley, the world's biggest securities firm by market value, forecasts the currency will drop to 86.20 U.S. cents by the end of the year, and 81.97 U.S. cents in December 2007. Lehman Brothers Holdings Inc., JPMorgan Chase & Co. and Barclays Capital also predict declines.

Commodities comprise 54 percent of Canada's exports and 12 percent of the nation's C$1.09 trillion economy. Canada's oil sands in Alberta contain the largest crude deposits outside the Middle East. The country is the world's No. 2 producer of nickel and zinc and exports copper, gold and other commodities.

Gold and oil gained about 2 percent last week. Gold futures climbed 26 percent this year while oil is up 22 percent from a year ago. Copper was up 3.1 percent for the week. The metal has risen 80 percent this year.

The currency will lose ground as economic growth in the U.S. weakens later this year, cutting demand for Canada's exports, Strauss said. The U.S. is Canada's biggest trading partner and receives more than 80 percent of Canadian exports.

`U.S. Slowdown'

``The looming hit on global growth from a U.S. slowdown may be more muted than in previous business cycles due to strengthening domestic demand in Europe and decreased reliance of Japan on U.S. exports,'' RBC strategists wrote in a report dated Aug. 4.

The U.S. economy grew at a below-forecast 2.5 percent annual rate last quarter, less than half the pace of the prior three months. Consumers cut spending as energy prices climbed, while business investment in new equipment fell for the first time in more than three years.

The Bank of Canada stopped raising interest rates after trimming its forecasts for economic growth to account for a slowdown in exports caused by the stronger currency. The central bank cut estimates for 2007 and 2008 growth by 0.1 percentage point to 2.9 percent and 2.8 percent.

The Bank of Canada on July 11 kept its benchmark interest rate at 4.25 percent, ending a streak of seven consecutive quarter-point increases since September. Canada's central bank next meets to set rates on Sept. 6.

http://maps.samidoun.org/Lebanon_Map_July12-28.jpgThe Invisible Hand--What an amazing article you posted regarding comments by Dr Mahathir Mohamad, the former Prime Minister of Malaysia! A must read for everyone!

It would not surprise me if, today, in the age of instantaneous information propagation, this idea gains traction and turns into a grass roots movement outside of the US. That you can't boycott US products as they're mostly no longer made in the US, etc.

Also discusses the media blackout in the US regarding the mideast war, supporting the notion that TPTB present the circumstances in a lopsided way (it's really an no holds barred invasion, not an "entering" of the country, involving wholesale destruction of civilian infrastructure, not a tit for tat, eye for an eye, but almost complete destruction.)

And of course you know what happens to gold if dollar is boycotted.

Look at link for how effectively the IDF has "entered" the democratic country of Lebanon.

http://urbansurvival.com/week.htmLots of good stuff at Urban Survival today.

http://www.usagold.com/cpmforum/archives/620068/default.htmlThanks for the excellent synopsis. I hope others take a moment to appreciate it as much as I did.

R.

http://www.iht.com/articles/2006/08/06/bloomberg/bxbuffett.phpAnd people complain that Bill Murphy
is always bullish on gold and silver!

* * *

By George Stein and Josh P. Hamilton
Bloomberg News Service
via International Herald Tribune, Paris
Monday, August 7, 2006

The billionaire investor Warren Buffett, stung by $955 million in losses from foreign-currency investments in 2005, cut his bet against the U.S. dollar this year, just before its steepest decline in 18 months.

Berkshire Hathaway, his insurance and investment company based in Omaha, Nebraska, had $5.4 billion in foreign-currency forward contracts at the end of March, down from as much as $21.8 billion in 2005, according to the company's earnings statements released last week. The U.S. Dollar Index, which is used to measure the dollar's value against six major currencies, fell 5.1 percent in the second quarter.

"It was the wrong timing," said Samarjit Shankar, director of foreign-exchange global strategy at Mellon Financial, based in Boston. "Even as shrewd an investor as Buffett can miss the timing sometimes."

Buffett, 75, dubbed the world's greatest investor by the biographer Robert Hagstrom, told investors in his annual report in March that he cut the contracts in favor of a new hedge against a declining dollar, buying interests in companies outside the United States.

The $4 billion purchase of an 80 percent stake in the Israeli toolmaker Iscar Metalworking, Buffett's first international acquisition, raised separate concerns as Hezbollah fighters fired rockets in the range of the plant in Tefen, near the Lebanon border.

"With the fighting, there's uncertainty," said Donald Thorpe, an insurance analyst at Fitch Ratings in Chicago. "Those assets are more at risk now."

Berkshire Hathaway reported late Friday that second-quarter profit rose 62 percent as investments benefited from higher U.S. interest rates and the weakening dollar.

Net income climbed to $2.35 billion from $1.45 billion a year earlier, the company said. The company had an $87 million gain on its foreign-currency position after a loss a year earlier. Still, Berkshire cut its currency contracts by $4.2 billion during the quarter to $1.2 billion.

"If he had kept the bet at the same size he had a year ago, he would have made even more, a lot more," said Mohnish Pabrai, a fund manager at Pabrai Investment Funds in Irvine, California. Still, "this is a blow-out quarter."

Iscar, purchased by Berkshire on July 5, was not included in the second- quarter results. The company closed its Tefen plant last month and planned to have employees work nights and weekends when it re-opened to avoid delays in deliveries, the Iscar chairman, Eitan Wertheimer, said last month.

Predicting that the U.S. current account deficit would hurt the dollar, Buffett began using forward contracts as a bet against the currency in 2002.

In the first three years, Berkshire recorded $2.96 billion in gains as the U.S. Dollar Index, which measures the dollar against the euro, yen, Swiss franc, British pound, Canadian dollar and Swedish krona, fell 31 percent. Last year, the index rose 13 percent.

"My views on America's long-term problem in respect to trade imbalances, which I have laid out in previous reports, remain unchanged," Buffett wrote in his annual letter to shareholders in March. "My conviction, however, cost Berkshire $955 million pretax in 2005."

Buffett, who did not respond to requests for comment, told investors that he scaled back his holdings of foreign currencies as U.S. interest rates rose relative to the rest of the world. Unlike changes in the value of stock or bond holdings, accounting rules require that fluctuations in currencies and derivatives be reflected in earnings reports.

"We don't know until well after the fact whether he's right or wrong," said Frank Betz, a partner at Carret Zane Capital Management of Warren, New Jersey, referring to Buffett's investment decisions. "Most of the time, he's right. Sometimes he gets a little egg on his face, and he comes out all apologetic."

Berkshire, which relies on insurance for about half the company's profit, reported $132 million more interest and dividend income than had been forecast by Charles Gates, an analyst at Credit Suisse Group in New York, as the insurance units ended the quarter with $37.3 billion in short-term investments equivalent to cash. The U.S. Federal Reserve raised short-term interest rates 2 percentage points to 5.25 percent in the year ended June 30.

Buffett "went into short-term cash a few years ago. Now that's paying off," said Guy Spier, whose hedge fund Aquamarine, based in New York, holds $11 million of Berkshire stock. Shares of Berkshire have risen 3.5 percent this year, compared with a 4.8 percent decline in the KBW
Insurance index and a 6.7 percent increase in the New York Stock Exchange composite index.

Profit from underwriting the policies fell 1.3 percent to $371 million, higher than Gates's $305 million estimate, as a decline at the auto insurer Geico countered gains at the reinsurer General Re, which benefited from there being fewer catastrophe losses outside the United States.

In June, Buffett changed his plan for his own stock holdings, saying that he would begin donating his Berkshire shares to charity now, rather than upon his death. Over time, he will give 85 percent of his stock to the Bill and Melinda Gates Foundation and four family charities, he said.

The stake was valued at about $37 billion at the time of the announcement.

http://www.usagold.com/DailyQuotes.html
The Daily Gold Market Report has beenupdated.

If you are considering investments in gold we invite you to request our freeintroductory information packet detailing the products and services offeredby USAGOLD ~ Centennial Precious Metals. We welcome your inquiry and lookforward to working with you.

MONDAY Market Excerpts

Gold edges higher ahead of Fed

August 7 (from Reuters) -- COMEX gold futures closed higher Monday, hoisted by rising oil prices, dollar weakness and war in the Middle East that attracted investors to safe havens like the precious metals, dealers said.

Most-active December delivery gold rose $3.50 to end at $659.50 after moving from $655.50 to $663.50.

Prices stuck to a tight trading band, however, in tentative activity before the U.S. Federal Open Market Committee's interest rate-setting meeting on Tuesday. As a result of the subdued tone in the market, the contract turned in an "inside day," holding within the prior session's high and low.

"Caution ahead of tomorrow's FOMC meeting has kept gold confined to another day of sideways range-trade, with the yellow metal and the rest of the complex treading water at the top of their current ranges," said TheBullionDesk analyst James Moore.

Since June 2004, the Fed has raised its key federal funds rate from 1 percent to 5.25 percent.

"The outcome of the meeting and post-rate speech by (U.S. Federal Reserve Chairman Ben Bernanke) should give a clearer indication of short to mid-term direction and could potentially push (spot) gold through the current $655 resistance band to challenge chart resistance around $678," Moore said in a note.

Dennis Gartman, author of The Gartman Letter, who is long-term bullish on gold, said prices were set to resume their climb amid strong energy prices, an increasingly difficult global political situation, and dollar weakness.

"There is resistance (in bullion) ... between $650-$655, however once that resistance is taken out, we'll likely add to our position."

---(see url for full news, 24-hr newswire)---

http://www.usagold.com/amk/newsgroup-form.htmlWhat happens when you set up a democracy and the wrong side wins?

Find out what's behind the impending civil war in the Mideast between Shiites and Sunnis, how the Bush doctrine led to unintended consequences in Iraq and why no one knows what to do about it.

Also,

Why Credit Suisse says $1200 gold is on the way.

What veteran newsletter writer Harry Schultz is saying about the gold market.

Cementing the pause (tomorrow). Some details.

How Calpers -- California's massive pension plan -- intends to beat the market in the coming years.

And. . .

What Central Bank News has to say about the coming deadline for this installment of the Central Bank Gold Agreement.

"When an asset that previously seemed pretty useless doubles in value, funny
how it changes one's view; somehow, one looks at it more fondly. Even
central bankers are human. Neither the Italians nor Germans have sold any
gold yet, and even the French will probably stop selling next year. They
have all made massive paper profits from their gold stocks."

____________________

If you haven't signed up for our widely anticipated, irregular missives (by e-mail), the above provides a glimpse of what your missing. All free of charge. Each article is rated using a five star system. The article on the sectarian split in the Mideast got five stars this time around.

We invite you to join the USAGOLD NewsGroup by going to the sign-up page linked above.

..shame on you Mr. Buffet.


"Berkshire Hathaway, his insurance and investment company based in Omaha, Nebraska, had $5.4 billion in foreign-currency forward contracts at the end of March, down from as much as $21.8 billion in 2005, according to the company's earnings statements released last week."

Weren't "derivatives" the "financial cesspool" or how did Mr. Buffet's friend Charlie express that once?

http://usa.mediamonitors.net/content/view/full/33668SNIPS
Tony Blair spoke his mind to the audience at the World Affairs Council in Los Angeles on August 01, 2006
+
At best, Blair sounds like a defeated former colonialist visiting the world from his grave. At worst, we just had the opportunity to peep into the mind of a desperate war lord.


Excerpts highlighted by the BBC
http://news.bbc.co.uk/2/hi/uk_news/politics/5236896.stm
We will not win the battle against this global extremism unless we win it at the level of values as much as force
+
The purpose of the terrorism in Iraq is absolutely simple: carnage, causing sectarian hatred, leading to civil war
+
It is about hearts and minds, about inspiring people, persuading them, showing them what our values at their best stand for
+
Our values... represent humanity's progress throughout the ages and at each point we have had to fight for them

==

Let me first tackle the BBC excerpts.

http://freedomkeys.com/faithandforce.htm
SNIPS
"To many Islamic nations, freedom is not a tonic, but a toxin; it's regarded not just as something that permits a challenge to faith, but is a challenge to faith by itself.
"To Westerners, the value of concepts like truth, life and liberty remains constant, writ in stone, whether our best efforts successfully earn that value or not. But many Westerners like myself watch events unfold in the Islamic world with the inching realization that the value it places on those concepts remains utterly fluid, seemingly shaped by convenience and circumstance.
"Even reason itself appears subject to sacrifice; some of the most cognitively dissonant images to come out of the controversy are protest signs with messages like, 'Behead those who say Islam is violent'." -- Andrew Steven Harris

http://freedomkeys.com/faithandforce.htm cont.

excerpts from
Faith and Force: The Destroyers of the Modern World
by Ayn Rand
(A lecture delivered at Yale University on February 17, 1960, at Brooklyn College on April 4, 1960, and at Columbia University on May 5, 1960.
Published as a pamphlet by the Nathaniel Branden Institute in 1967,
and now included as a chapter in the book, Philosophy: Who Needs It )
+
"There is only one fundamental alternative in the universe: existence or non-existence -- and it pertains to a single class of entities: to living organisms. The existence of inanimate matter is unconditional, the existence of life is not: it depends on a specific course of action. Matter is indestructible, it changes its forms, but it cannot cease to exist. It is only a living organism that faces a constant alternative: the issue of life or death. Life is a process of self-sustaining and self-generated action. If an organism fails in that action, it dies; its chemical elements remain, but its life goes out of existence. It is only the concept of 'Life' that makes the concept of 'Value' possible. It is only to a living entity that things can be good or evil.

==

The poodle does not know what he is talking about.

(granted, this Invisible Hand should also think over how to apply Objectivism to the present situation in the Middle-East.

"Our values... represent humanity's progress throughout the ages and at each point we have had to fight for them�, says the poodle.

"Throughout the centuries there were men who took first steps down new roads armed with nothing but their own vision. Their goals differed, but they all had this in common: that the step was the first, the road new, the vision unborrowed, and the response they received � hatred", says Rand.)

This New World Order-speech of the poodle must however inspire us to think about the past and future of gold in the monetary/financial power system.

The poodle function of the poodle vis-�-vis EU and EMU is a geo-politic datum which is characteristic of the growing impotency of the dollar colonialism.

With this speech, then poodle has sealed the end of his career.

Still,
the poodle wants to be Prime Minister a year from now � or longer � supporters claimed yesterday.
+
But critics in Labour believe he has become such a political liability � including his unpopular pro-America stance on the Middle East crisis � that he will cost them votes at next May's local elections.
http://express.lineone.net/news_detail.html?sku=282

http://en.rian.ru/russia/20060807/52354838.htmlMOSCOW, August 7 (RIA Novosti)
SNIP
Since January 1 2006, the CBR [Central Bank of Russia} has calculated its gold reserves based on the market rate.

==

MTM (mark to market) is a fact since January 01, 2006

==

http://www.free-europe.org/blog/english.php?itemid=56

SNIP from August 2003

In Russia, the Middle East and India, there is an increasing aversion against the dollar and is a search for a replacement under way. The present gold fever in China where individuals are since early 2003 again allowed to possess gold implies that in order to be an economic world power by 2012, China could well accede to this world standard, Freegold. At that moment only physical gold will be traded as the natural vehicle to incorporate one's wealth, the value of paper gold will be reduced to nothing, and the value of the euro will increase quarterly upon the marking to market of its gold reserves.

The ECB will not define the euro like the old gold standard as a certain quantity of gold, but will use it as a free trading financial reserve so that each increase in the price of gold will bring about an increase in the value of the euros reserves and thus an increase in the value of the euro itself. This currency concept is closer to the tenets of libertarianism than a gold standard because of the exchange restrictions which inevitably follow
UNSNIP

Let's have a party!

http://www.iranmania.com/News/ArticleView/Default.asp?NewsCode=44900&NewsKind=Current%20AffairsStoring Iran's Sorush, Noruz oil costs $243m
SNIP
LONDON, August 7 (IranMania) - The storage of 15 million barrels of unsold oil in the tankers has cost the nation around $243 million within the past eight months, MNA reported.

==

Or oil weapon?
Can you spell "embargo"?

http://english.eluniversal.com/2006/08/07/en_pol_art_07A760899.shtmlISRAEL RECALLS AMBASSADOR TO VENEZUELA
SNIP
"We have decided to recall our ambassador for consultations due to the unilateral position of the Caracas Government on the Middle East and because Venezuela resolved to get closer to extremist elements in the region, such as the Iranian president, who day and night claims that Israel should disappear," Spokesman Mark Regev told AFP

http://news.independent.co.uk/world/politics/article1217621.eceUN RESOLUTION DELAYED AMID DIPLOMATIC CHAOS
Published: 08 August 2006
SNIPS
Efforts at the UN to approve a Security Council resolution demanding a suspension of fighting in Lebanon were set back by at least another 24 hours last night after diplomats agreed to listen first hand to objections being raised by foreign ministers of the Arab League
+
Tony Blair is meanwhile hoping to escape to the Caribbean for his delayed holiday tomorrow leaving Labour MPs growing increasingly angry and frustrated at the UN delays.
+
The Foreign Secretary, Margaret Beckett, was continuing her summer holiday in a caravan in France last night.

http://www.jpost.com/servlet/Satellite?cid=1154525825638&pagename=JPost%2FJPArticle%2FShowFullSNIP
"We have a problem with the leadership in Caracas that hugs the Iranian president who calls for the annihilation of Israel."


==

A Jewish friendsent me last week a memo calling for the recognition of Israel's right to exist.
All states have come and gone in history.
How long does Israel want to exist? Forever?
Even in my native Belgium, some people call for separatism.
What is all this nonsense?

As I said earlier toDAY in my Viagra msg#: 146425
SNIP
As most people cannot see this change which is happening before their eyes,
let alone that they would know that this euro-freegold-transition-process involves a structural change,
they continue to utter the same NONSENSE and hatred they always utter when the Middle-East is on fire.
UNSNIP

At the end of the DAY we may end up with
FREE GOLD and a FREE ISRAEL.

A STRUCTURAL change for gold. NO POLITICAL change for Israel.

Let me quote Alicja Rosenbaum, aka Ayn Rand, again:
Reality is that which exists; the unreal does not exist; the unreal is merely the negation of existence which is the content of a human consciousness when it abandons REASON.

Use reason and look at the structural changes.
Stop relying on emotions and nationalism.

Or is the call for annihilation of Israel a trick to continue to hide the euro-freegold-transition-process from the sheeple?

Watch Russia!

The Invisible Hand (8/7/06; 20:04:25MT - usagold.com msg#: 146435)
The price of gold will NEVER go down again - MTM is a fact
http://en.rian.ru/russia/20060807/52354838.html

What about the TIMING of the disclosure by RIAN NOVOSTI (rian.ru) of the MTM-ing since January, that's more than SEVEN MONTHS ago?

@TIH,

I find it interesting that one of the major "predictions" of the Web bots (gathered from information anlyzed before the onset of Lebanon crisis) for the autumn 2006 period is a major change in the global political view of Israel.

Without interjecting any value judgements, it seems to be appearing both in the media and on the Internet.

Another one is that "paper gold" could be outpaced by physical, an idea that has seen some traction here, as well.

I think even Sinclair has mentioned that the relationship between paper gold and physical gold is not acting within its "normal" parameters.

Goldilox finds it interesting that one of the major "predictions" of the Web bots (gathered from information anlyzed before the onset of Lebanon crisis) for the autumn 2006 period is a major change in the global political view of Israel.

Here's the "total" (?) picture of Condi's "New Middle East"

http://www.townhall.com/Columnists/PatrickJBuchanan/2006/08/08/condis_new_middle_east
"Things are as they are, and their consequences will be what they will be. Why then should we seek to be deceived?"
+
Indeed, in Israel, dissent against the blitzkrieg is rising, and the Olmert regime is being challenged and even condemned by courageous Israelis for letting the air force have a free hand to smash Lebanon.
Moving on to Iraq, where the war has lasted as long as our war on Nazi Germany, Gen. John Abizaid is warning that a descent into civil war is now possible, and Bush concedes that, three years and three months after "Mission Accomplished," the situation in Baghdad is "terrible."

http://www.iranmania.com/News/ArticleView/Default.asp?NewsCode=44911&NewsKind=Current%20Affairs
LONDON, August 8 (IranMania) - The head of Iran's Revolutionary Guards said the United States and Israel would not survive if they attacked his nation, the IRNA news agency reported.

http://www.iranmania.com/News/ArticleView/Default.asp?NewsCode=44908&NewsKind=Current%20Affairs
LONDON, August 8 (IranMania) - US President George W Bush on Monday accused Syria and Iran of fomenting "chaos" in the Middle East, and said both knew exactly what they must do to escape US diplomatic crosshairs, AFP reported

http://www.chinadaily.com.cn/world/2006-08/08/content_659304.htm
"I gave an order that, if within the coming days the diplomatic process does not reach a conclusion, Israeli forces will carry out the operations necessary to take control of rocket launching sites wherever they are," Israeli Defense Minister Amir Peretz said.
Justice Minister Haim Ramon said Israel could not withdraw before the arrival of an international force. "The moment we leave, Hezbollah will return."

http://en.rian.ru/russia/20060806/52314804.html
MOSCOW, August 6 (RIA Novosti) - The Iranian ambassador to Moscow transferred Sunday an oral message of Iran's Foreign Minister Manuchehr Mottaki to Russia's First Deputy Foreign Minister Andrei Denisov on the situation in Lebanon

The End of Partnership
http://www.kommersant.com/page.asp?idr=527&id=695589
The U.S. Department of State has imposed sanctions against state-run companies of Russia, Rosoboronexport and Sukhoi, making clear the absolute dissatisfaction of Washington with the foreign policy of Moscow. The sanctions are the end of the epoch of Russia's-the U.S. strategic partnership that has been declared until recently.

http://news.bbc.co.uk/2/hi/business/5255034.stmLast Updated: Tuesday, 8 August 2006, 06:03 GMT 07:03 UK
SNIPS
Oil prices have eased slightly after hitting record highs on Monday, despite uncertainty as to when BP's key Prudhoe oilfield will resume production.
+
Producers' group Opec has insisted that it has enough spare capacity to meet any shortfall in supplies, but analysts say Prudhoe's shutdown will reduce the "oil cushion" to less than two million barrels a day.


The Invisible Hand (8/7/06; 20:43:43MT - usagold.com msg#: 146436)
Oil crisis?
http://www.iranmania.com/News/ArticleView/Default.asp?NewsCode=44900&NewsKind=Current%20Affairs
Storing Iran's Sorush, Noruz oil costs $243m
SNIP
LONDON, August 7 (IranMania) - The storage of 15 million barrels of unsold oil in the tankers has cost the nation around $243 million within the past eight months, MNA reported.

http://english.eluniversal.com/2006/08/03/en_pol_art_03A758627.shtmlCH�VEZ, AHMADINEJAD AND PUTIN ON THE ATTACK
SNIP
Venezuelan President Hugo Ch�vez aims at an alliance with the Russian-Chinese axis, communion with radical Islamism via Iran, expansion of the revolutionary Venezuela-Cuba-Bolivia triad and the establishment of the big homeland.

@ TIH,

Lines are being drawn in the sand, as the "Godless Socialists" and "Muslim Fundamentalists" unite against what they perceive as a combined Judeo-Christian Zionist expansionist threat. The energy-hungry West wants their oil, and the thirsty Israelis covet their water.

Things are likely to get worse before they get better, making the "security premium" of PM holdings a rather strong factor.

One thing to watch from an investment standpoint is the media perception (propaganda) that "all is well on the diplomatic front," as it will be a trigger to attack gold quite perniciously, IMHO.

This attack may well be the "final" weak hands shake-out and buying opportunity before we start to see the oft' predicted $100 swings, again just MHO.

Goldilox,

You say:
in Goldilox (8/8/06; 01:28:24MT - usagold.com msg#: 146444)
One thing to watch from an investment standpoint is the media perception (propaganda) that "all is well on the diplomatic front," as it will be a trigger to attack gold quite perniciously, IMHO.

I quoted:
in The Invisible Hand (8/7/06; 22:12:33MT - usagold.com msg#: 146438)
UN RESOLUTION DELAYED AMID DIPLOMATIC CHAOS

Do you mean that tomorrow, "they" will say everything is well?

http://www.ecb.int/stats/exchange/eurofxref/html/index.en.htmlIt has pleased our masters to let oil reach almost $80, but our yellow is not allowed to move. Still Ria Novosti disclosed MTM

SNIP
Euro foreign exchange reference rates
The reference rates are based on the regular daily CONCERTATION PROCEDURE between central banks within and outside the European System of Central Banks, which normally takes place at 2.15 p.m. ECB time (CET).

Concertation like the London Gold Fix.

Free Markets, said you?

Thanks for the news.

Gold to surely reach your magical number !

http://english.eastday.com/eastday/englishedition/business/userobject1ai2238550.htmlSnip:

"...
Exchange shows that in the first six months, the turnover of gold on the exchange reached 88.058 billion yuan (US$11 billion), up a whopping 78.41 percent in value terms and close to the turnover figure for the whole of 2005.
This represents a volume of 572.57 tons of gold traded on the Shanghai Gold Exchange, up 32.97 percent year on year.
Twenty-two financial institutions, including China's Minsheng Bank, have become institutional members of the Shanghai Gold Exchange this year, bringing the total number of institutional members to 130...
..."

Sundeck: No comment...

http://www.businessday.co.za/articles/markets.aspx?ID=BD4A247460Is it due to price-fixing Opec that the POO is reacting?
I mean gold is not reacting.

Or is it that oil is absolutely necessary for this civilisation to continue?
Honest money is also a necessary condition to that effect. But are our masters still able to contain the POG? Are they spending or devoting a last ditch effort to save paper? And are the Russians putting freegold batons in the wheels of our masters?

SNIP
LONDON - Gold prices in Europe were cautiously steady today, supported by dollar weakness ahead of the US Federal Reserve meeting, a sharp rise in oil prices and the conflict in the Middle East.

http://www.baz.ch/news/index.cfm?keyID=02faed07-ac4e-423c-90c2ac226f4b680d☆tpage=1&ObjectID=7C5F9B8E-1422-0CEF-70843A06CE365A44
17.07.06
Gold, ... l und Dollar legen im Zuge der Spannungen im Nahen Osten gleicherma�en zu, hei�t es bei der HelabaTrust.

http://en.rian.ru/business/20060808/52381505.htmlSNIP
MOSCOW, August 8 (RIA Novosti) - Promsvyazbank, a leading Russian commercial bank and the Luxembourg-based branch of Germany's Commerzbank signed Tuesday an agreement on prolonging a gold bullion loan for 12 months until August 2007.

http://www.kommersant.com/page.asp?id=695864
CRUDE OIL TO SOAR TO $250/Bbl

SNIP
But the worst will happen only if Iran not only stops deliveries but also blocks the Strait of Hormuz passed by oil tankers from Kuwait, Saudi Arabia and the United Arab Emirates. As more than 15 million barrels of crude are daily shipped via the Hormuz, i.e. nearly 40 fold more than via Trans Alaska, the sharp reduction in deliveries will trigger global recession similar to the one happened in 1980 to 1982 and fuel the prices to $250, according to http://www2.standardandpoors.com/servlet/Satellite?pagename=sp/Page/HomePg&r=1&l=EN&b=10

http://za.today.reuters.com/news/newsArticle.aspx?type=businessNews&storyID=2006-08-07T065412Z_01_BAN723143_RTRIDST_0_OZABS-MARKETS-OIL-20060807.XML
SNIP
The credit ratings agency forecast three scenarios -- with a $250 oil barrel sparking global recession in the worst of them, should Iran close the Strait of Hormuz, a bottleneck in the Gulf region between Iran and Oman by which tankers from Kuwait, Saudi Arabia and the United Arab Emirates transit ( But the most likely scenario, based on a limited conflict, has prices falling from current $75 levels to below $70 by year-end and to $60 by end-2008, which would allow the world economy to keep expanding, with U.S. growth slowing to 2.5 percent in 2007, S&P said.

==

At $80 oil, our masters can still contain the POG.
We'll see what happens at three times that price.

@ The Invisible Hand..............I find your constant reference to the Prime Minister of Great Britain as "the poodle" as an insult to the citizens of the UK. Wash your mouth out kind sir!

While Paulson make strike the posture of a strong dollar ,the general consensus is that it is in this countries interest to devalue , however they want it controlled and orchestrated , rather than a runaway. We are still trying to get the Chinese to let their currency float which would weaken the dollar hence the comments about free markets determining the dollars value.

It wasn't so long ago the dollar held steady at 90 for many months. Now it has dropped to 86 and holding steady ,no doubt by the action of some invisible hand. All these values exist in a dynamic equilibrium with a variety of components and the amounts needed to move the numbers from their equilibrium probably is not too great (although no one seems to know how all this is done )

As for gold the most likely explanation for the spike several months ago were the reported large buybacks of Barricks hedge position during the first quarter . Here we can see how a determined buyer can run the price up , and others join the stampede

Whether China might seek to fill this roll is uncertain , probably even to them. By all reports there is great prosperity in China . They have been the chief beneficiary of the NWO. as they should have been , because until recently they were so poor . Why would they kill the goose that laid the golden egg?

By the way it was the British press that coined the term "poodle" to descibe Blair , because he seemed to trot along after Bush into the Iraq war. Don't get me wrong .It was a good plan. But as with so many of these plans , someone has to die, 30,000- 50,000 Iraqis killed, hundreds of thousands more wounded and billions of dollars damage.

http://www.usagold.com/amk/news-group.htmlWe invite you to enjoy this latest review of articles from the USAGOLD NewsGroup.

To receive timely notice of featured news and opinion via e-mail, be sure to use the link "Join the USAGOLD NewsGroup" to get in on the action. Best of all, it's FREE!

While admitting that inflation is still a risk, the FED voted to leave the benchmark rates unchanged.

Not unanimous this time, so it's hard to predict December as a repeat, or call this a "trend change".

http://counterpunch.org/kolko07262006.htmlOn June 15 we published Gabriel Kolko's essay on the enormous instability of the world'd financial system. In the ensuing weeks Professor Kolko has enlarged his analysis, and here we offer our readers his updated version. AC / JSC

There has been a profound and fundamental change in the world economy over the past decade. The very triumph of financial liberalization and deregulation, one of the keystones of the "Washington consensus" that the U.S. government, International Monetary Fund (IMF), and World Bank have persistently and successfully attempted over the past decades to implement, have also produced a deepening crisis that its advocates scarcely expected.

The global financial structure is today far less transparent than ever. There are many fewer reporting demands imposed on those who operate in it. Financial adventurers are constantly creating new "products" that defy both nation-states and international banks. The IMF's managing director, Rodrigo de Rato, at the end of May 2006 deplored these new risks � risks that the weakness of the U.S. dollar and its mounting trade deficits have magnified greatly.

De Rato's fears reflect the fact that the IMF has been undergoing both structural and intellectual crises. Structurally, its outstanding credit and loans have declined dramatically since 2003, from over $70 billion to a little over $20 billion today, doubling its available resources and leaving it with far less leverage over the economic policies of developing nations � and even a smaller income than its expensive operations require. It is now in deficit. A large part of its problems is due to the doubling in world prices for all commodities since 2003 � especially petroleum, copper, silver, zinc, nickel, and the like � that the developing nations traditionally export. While there will be fluctuations in this upsurge, there is also reason to think it may endure because rapid economic growth in China, India, and elsewhere has created a burgeoning demand that did not exist before � when the balance-of-trade systematically favored the rich nations. The U.S.A. has seen its net foreign asset position fall as Japan, emerging Asia, and oil-exporting nations have become far more powerful over the past decade, and they have increasingly become creditors to the U.S.A. As the U.S. deficits mount with its imports being far greater than its exports, the value of the dollar has been declining � 28 per cent against the euro from 2001 to 2005 alone. Even more, the IMF and World Bank were severely chastened by the 1997-2000 financial meltdowns in East Asia, Russia, and elsewhere, and many of its key leaders lost faith in the anarchic premises, descended from classical laissez-faire economic thought, which guided its policy advice until then. "�{O]ur knowledge of economic growth is extremely incomplete," many in the IMF now admit, and "more humility" on its part is now warranted. The IMF claims that much has been done to prevent the reoccurrence of another crisis similar to that of 1997-98, but the international economy has changed dramatically since then and, as Stephen Roach of MorganStanley has warned, the world "has done little to prepare itself for what could well be the next crisis."

The whole nature of the global financial system has changed radically in ways that have nothing whatsoever to do with "virtuous" national economic policies that follow IMF advice � ways the IMF cannot control. The investment managers of private equity funds and major banks have displaced national banks and international bodies such as the IMF, moving well beyond the existing regulatory structures. In many investment banks, the traders have taken over from traditional bankers because buying and selling shares, bonds, derivatives and the like now generate the greater profits, and taking more and higher risks is now the rule among what was once a fairly conservative branch of finance. They often bet with house money. Low-interest rates have given them and other players throughout the world a mandate to do new things, including a spate of dubious mergers that were once deemed foolhardy. There also fewer legal clauses to protect investors, so that lenders are less likely than ever to compel mismanaged firms to default. Aware that their bets are increasingly risky, hedge funds are making it much more difficult to withdraw money they play with. Traders have "re-intermediated" themselves between the traditional borrowers � both national and individual � and markets, deregulating the world financial structure and making it far more unpredictable and susceptible of crises. They seek to generate high investment returns � which is the key to their compensation � and they take mounting risks to do so.



Druid: Kind of old news for many old timers here at the castle but an excellent read nontheless. Enjoy.

http://www.federalreserve.gov/boarddocs/press/monetary/2006/20060808/default.htmAugust 8, 2006

The Federal Open Market Committee decided today to keep its target for the federal funds rate at 5-1/4 percent.

Economic growth has moderated from its quite strong pace earlier this year, partly reflecting a gradual cooling of the housing market and the lagged effects of increases in interest rates and energy prices.

Readings on core inflation have been elevated in recent months, and the high levels of resource utilization and of the prices of energy and other commodities have the potential to sustain inflation pressures. However, inflation pressures seem likely to moderate over time, reflecting contained inflation expectations and the cumulative effects of monetary policy actions and other factors restraining aggregate demand.

Nonetheless, the Committee judges that some inflation risks remain. The extent and timing of any additional firming that may be needed to address these risks will depend on the evolution of the outlook for both inflation and economic growth, as implied by incoming information.

Voting for the FOMC monetary policy action were: Ben S. Bernanke, Chairman; Timothy F. Geithner, Vice Chairman; Susan S. Bies; Jack Guynn; Donald L. Kohn; Randall S. Kroszner; Sandra Pianalto; Kevin M. Warsh; and Janet L. Yellen. Voting against was Jeffrey M. Lacker, who preferred an increase of 25 basis points in the federal funds rate target at this meeting.

http://www.canada.com/components/print.aspx?id=bd536825-33a2-41e9-931b-047ce5d54dca&k=58533August 08, 2006 -- At the top of Bank of Nova Scotia's red skyscraper in Toronto, a group of salespeople and traders from the bank's ScotiaMocatta precious-metals unit sit in front of blinking terminals buying and selling gold, silver, platinum and palladium all around the world.

Seventy floors below, an underground vault holds stacks of bullion in safekeeping for clients.

Despite its home in the New World, ScotiaMocatta is the world's oldest gold dealer. The firm traces its history back to 17th-century London, where the Mocatta family set up as a bullion dealer to the Bank of England. The Canadian bank bought the business from a British bank in 1997 and has since steadily expanded its precious-metals operations.

ScotiaMocatta is still one of the biggest players in its ancestral home of London, where the majority of the Western world's gold changes hands. The company is one of the select clearing houses that move an average of US$15.4-billion of gold to settle each day's trades...

Even as one of the biggest dealers in the world, precious metals are a niche business for Bank of Nova Scotia.

The bank's commitment to the business is increasingly rare, as other banks steadily pull out of precious metals, deeming the business too small or too unrelated to the real money makers of retail or investment banking. N.M. Rothschild and Credit Suisse are among the rivals that have left the business altogether or scaled back... [Randy's note: getting out even though, as the article indicated, "the precious metals business has generated record profits four years in a row." For more insight, read on...]

That's provided an opportunity for ScotiaMocatta, which has been an active shopper as other banks shed assets. Mr. Wainstein is currently looking at a proposal from another competitor that wants out.

The outlook for gold is still bullish after its rise beyond US$650 an ounce, Mr. Wainstein says, as there are concerns about a weakening U.S. dollar and rising inflation. A higher price, however, is not necessarily good for business.

^---(from url)---^

The key thing to wrap your mind around is that the "assets" being shed by other banks are things such as gold loans -- effectively an income stream in the form of contracts in which a counterparty has pledged itself to make future payments of gold metal (or optionally money payments of the gold-price equivalent).

The reason some of the other more astute and more risk-averse bullion banks have been dropping out of the business -- like gangbusters in the wake of the original European Central Bank Gold Agreement of September 1999 -- is very much connected with that little insight I've posted as the final comment of my article excerpt: i.e., A higher price, when you're running a gold lending operation, is not necessarily good for business.

The reason is manifold, but paramount among them is that a rising price makes it increasingly difficult for the bank's gold borrowers to make good on the service of their individual gold loans. It is akin to a conventional money-borrower struggling to repay their debts in a deflationary environment.

I take it as a very good omen for the future that Wainstein has indicated that yet another one of ScotiaMocatta's bullion banking competitors wants out.

R.

Voting against was Jeffrey M. Lacker --

http://www.nymex.com/media/delivery.pdfI'm as Bullish as the next feller when it comes to the L/T outlook for Gold however ...we seem in for a bit of retracement here as Aug deliveries trickle to a halt.
A demand trough just prior to Sept might offer the last buying opportunity for some time ...iffen you're looking for "positive spin".

http://yahoo.reuters.com/news/articlehybrid.aspx?storyID=urn:newsml:reuters.com:20060808:MTFH14510_2006-08-08_19-54-44_N08182933&type=comktNews&rpc=44LIMA, Peru, Aug 8 (Reuters) - Peru's central bank mopped up $231 million in foreign currency on Tuesday, the country's largest ever one-day purchase...

A surge in local demand for soles from mining companies with looming tax bills pushed the currency through a psychological barrier of 3.230 per dollar to 3.226, its highest level since early 1999. The sol has been buoyed by high commodities prices.

"There is a large flow of dollars into soles in the market and the central bank will continue intervening when there is high volatility, (but) not to fix a floor for the currency," central bank director Eduardo Iriarte told local radio.

^---(from url)---^

Do you think the timing of this dollar support is a mere chance coincidence, or do you think it might have anything to do with this bit of news I posted on Friday?

VVVVVVVVVVVVVVVVVVVVVVVVVVVVVVVVVVVVV

TownCrier (8/4/06; 15:19:16MT - usagold.com msg#: 146364)
Treasury secretary to attend inauguration of Colombian president
http://www.newspress.com/Top/Article/article.jsp?Section=BUSINESS&ID=564782087954368069
WASHINGTON (AP) - Treasury Secretary Henry Paulson plans to lead a delegation to Colombia on Monday to attend the inauguration of Colombian President Alvaro Uribe...

Paulson also plans to meet with Peruvian President Alan Gracia, who is also expected to attend Uribe's inaugural ceremony...

^---(from url)---^
How well do you understand the foundation of the U.S. Dollar and the Treasury bond?
It shouldn't surprise anyone that, from among the broad Cabinet of luminaries and dignitaries, it was the Secretary of the Treasury who was chosen as the principle represetative of the United States for this particular house call.
The foundation is eroding. Choose gold.
R.

http://www.usagold.com/DailyQuotes.html
The Daily Gold Market Report has beenupdated.

If you are considering investments in gold we invite you to request our freeintroductory information packet detailing the products and services offeredby USAGOLD ~ Centennial Precious Metals. We welcome your inquiry and lookforward to working with you.

TUESDAY Market Excerpts

Gold softens awaiting FOMC decision

August 8 (from DowJones) -- Comex gold and silver futures traded quietly on Tuesday ahead of the Federal Open Market Committee meeting later in the day but settled lower as traders remained cautious.

At the New York Mercantile Exchange, December gold settled down $2.20 at $657.30. The contract drifted between $652.30-$658.80 during the day session while the dollar and euro traded nearly flat.

While a majority of traders and market observers contend that the Fed will likely pause in its rate-tightening cycle on Tuesday, ending its 17 consecutive hikes, other expect one more increase.

At any rate, many precious metals analysts do not expect more than a short-term and possibly subdued reaction from bullion once the decision is made public, said Kitco's analyst John Nadler. "Bullion prices drifted on either side of the $645 mark while market pundits were flipping coins marked hike/pause in their minds."

He added that factors such as the conflict in the Middle East, the "developing civil war in Iraq, the absolute intractability of Iran, and the prospects of $4 per gallon gasoline being just around the corner are certainly posing more of a challenge to asset allocators than what may well be the last in a series of interest rate hikes - that is, if it takes place at all."

---(see url for full news, 24-hr newswire)---

http://markets.usatoday.com/custom/usatoday-com/html-story.asp?markets=Commodities&guid=%7B159350EE%2DA0D6%2D40D3%2D8BEE%2DE62115AC5A6A%7DAnother week of negative gas injection figures? that reminds me of that mel brooks film with the giant spaceship transformer and the vacume cleaner: mega-maid.

"Quick, Lone Star! Target the reversal switch!"

Data should appear here eventually:
http://tonto.eia.doe.gov/oog/info/ngs/ngs.html

Team Spaceball is comming up short.

http://news.bbc.co.uk/2/hi/uk_news/politics/5256222.stmSNIPS
Former Israeli prime minister Binyamin Netanyahu has praised Tony Blair's handling of the Middle East crisis. ]
+
"Mr Blair is doing a great deal. He's standing up for his beliefs - HE IS NOBODY'S PUPPET.
"He genuinely understands what is the correct picture. He is getting attacked from every side. That makes him more of a leader, not less so.
"Leadership is tested in doing the unpopular things - not going with the flow."

http://www.khaleejtimes.com/DisplayArticleNew.asp?xfile=data/weekend/2006/August/weekend_August10.xml§ion=weekend&col
SNIP
It is indeed sad to see a great country that once determined the world's destiny and has remained a source of inspiration to parliamentary democracies and civil rights groups everywhere should submit itself completely to the whims and fancies of the US establishment.

Golden Lionheart,

You are quite na�ve.

If you don't like poodle. Call him a Trojan horse. I am at loss to understand how this could be an insult to the "citizens" of the UK.

What percentage of those "citizens" are komrades of Blair and have voted for him?

Due to the poodleship of Blair, Berlusconi, aka Pipo the Clown, and Aznar, aka manager of the Christian Taliban, have got into big problems, not to speak of the innocents of both parties (Lebanon and Israel) who are being killed.

This is what AngloAmerikan kultural

(compare Blair's speech of August 01 in Amerika
The Invisible Hand (8/7/06; 19:50:41MT - usagold.com msg#: 146434)
Thus spake the poodle
http://usa.mediamonitors.net/content/view/full/33668)

and military imperialism amounts to.

They are instituting a kulture of FEAR.

How dare you hold the "citizens" of Great-Britain and Northern Ireland responsible for this?

On that account, the Russian "citizens" are responsible for this:

http://www.kommersant.com/page.asp?id=695859
The Inflation Sub-Component
July inflation hit 0.7 percent in Russia, worse even than the most pessimistic expectations. The bureaucrats no longer mention the 8.5-percent inflation planned for this year, giving up 9 percent instead. But analysts doubt even that figure. Their outlook is the 10-percent inflation in 2006 and the ruble appreciation of 26.2 to the U.S. dollar.

http://www.informationclearinghouse.info/article14391.htm

Hizbollah Is Not A Terrorist Organization

ONE MANS TERRORIST IS ANOTHER MANS FREEDOM FIGHTER

George Galloway has spoken out in support of Lebanon, saying he believes Hizbollah is justified in defending Lebanon against Israeli attacks . The Respect MP also lambasted media coverage of the war and said the UN resolution means nothing.


http://www.georgegalloway.com/exposingbiglie.html

I THINK the antiwar movement was guided by the journalistic principle first annunciated by the great Claude Cockburn, father of Alexander and Patrick. Cockburn's principle was that nothing is true until it's been officially denied. And, of course, the corollary is also true�that which the state and the government claim should be treated as a lie until it's proved otherwise. While the mass media and the gullible among the political legislatures accepted hook, line, and sinker everything they were fed by the state, it all turned out to be false.
I think we instinctively imagined that there was an absurd level of demonization of Iraq going on, a total exaggeration of its potential danger, and the demonization of its leadership out of all proportion.
+
Israel's purpose, in its creation, was to keep the Arabs divided and weak and to be an advance guard for imperialist interests in the region, the full importance of which was only just becoming known when the Zionist enterprise sprang forth. And now, Israel is an indispensable, nuclear-armed military superpower acting on behalf of imperialism in the Arab world.
One of the reasons for keeping the Arabs divided and weak is, of course, so that the imperialist countries can steal their wealth, so that they could keep them in their box, so that they don't unify and challenge their domination of the region. But of course a consequent need is to make sure that no Arab power emerges that can balance Israel, let alone threaten it. Israel's overwhelming military superiority has to be maintained. And so one of the reasons for attacking Iraq was for Israel, but not because imperialism is working for Israel. It's the other way around.

==

US forces are ready today to destroy 10,000 targets in the Middle East in a few hours. US readiness for more war is just one indicator that
- the present war is likely to spread and intensify in the coming months
- diplomats, who are maintained alive with stolen (the thief does not come back periodically nor does he pretend to be stealing in the general interesr) tax money, are irrelevant - Gregoire Vardakis, can you hear me?
- oil is going to $ 250 as I said earlier today
- gold is going to �

http://www.commondreams.org/views06/0808-34.htmby Greg Palast

Snippets:

The timing of a sudden inspection and fix of a decade-long problem has a suspicious smell.

Is the Alaska Pipeline corroded? You bet it is. Has been for more than a decade.

BP's suddenly discovered corrosion necessitating an emergency shut-down of the line is the same corrosion Dan Lawn has been screaming about for 15 years.

http://www.larouchepub.com/lar/2006/3331know_your_enemy.htmlThe Enemy Is Oligarchism

Snippets:

Some foolish people believe that Israel is behind the war against Lebanon. Some other people think that the U.S.A. is behind Israel's role in the war.

Meanwhile, actually well-informed people know that it is the international financier circles of which Felix Rohatyn is a part, which are the actual forces steering the current plunge toward what is fairly described as "World War III."

And some more on the same track....
http://www.larouchepub.com/other/2006/3331oligarch_factsheet.html

http://www.larouchepub.com/lar/2006/interviews/3331stockwell_july27.html

Could any of this actually be true??

The first casualty of war and all of that...or?

http://news.silverseek.com/TedButler/1155064922.php10:24p ET Tuesday, August 8, 2006

Dear Friend of GATA and Gold:

Silver market analyst and GATA consultant Ted Butler
has written what may be his most profound commentary,
arguing that the world has never seen a free market in
silver but that the current price manipulation, a
result of the long dishoarding of silver by
governments that formerly used it for coinage, is sure
to fail, and probably soon.

Butler's commentary is titled "A Blind Man's World"
and you can find it at GoldSeek's companion site,
SilverSeek, at the link above.

CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.

http://www.rense.com/general73/chintakes.htm
Druid: Ten Bears and yet another view. Query these authors and you will find that their political analysis is quite informative. They seem to have a decent record in making geopolitical calls. This article is an extremly scary commentary.

It is clearly Iran. They have destroyed their old enemy Saddam without firing a shot. Iraq is such a mess it can't challenge Iran for a hundred years.
The USA is bogged down in Iraq for the forseeable future. Israel can't defeat Hezbolah in Lebanon and so is going down the road of collective punishment making new Arab friends. What chance would they have against Iran?
Soon It will be one big Islamic republic from Iran to Lebanon.
Way to go George. Nice job!
$100/bbl oil coming this winter along with $1,000/oz gold.

Thanks for the link. A scary commentary indeed!

hoeing taters! that's the lot meant for you, Sam Gamgee!How about a corgie? They're quite civilised.

The squabbling in the ME has been going on since long before 1947. I wanted to rail about the badly executed plan for Iraq, but Nasr's comments cover most of the obvious points. It is too late for that anyhow. Despite the noise, the name-calling and the explosions and screams the mess in the middle east is a sideshow.

Where is the analysis Sir White Hills? What about Gold? Well you should ask. Mr Simmons was right, THERE IS NO PLAN B for energy. That is obvious. What I have been trying to ascertain is what exactly was PLAN A?

Does anyone honestly expect me to belive that TPTB, the great minds that run the world HAD NO PLAN A? Certainly they were never naive enough to belive oil would last forever. Assuming for the moment that the President met swift success in his Bold Plan for Iraq (and its neighbors). At the current rate of growth, Peak Oil might have been delayed for at most 5 to 15 years. That is hardly a strategic solution in the grand game. It barely counts as a play. Now Gold is to become the mark to market ASSET OF WEALTH, the PRIME MERIDIAN gainst which all others are referenced. Wonderful. What genius by the great ones! What happens to the energy markets? If gold sits on one tray of the balance scale and all other produce and capital sits on the other, then exactly what have TPTB acomplished? To bind us anew with a ring of gold only to send us back to an agrarian past, and to lose the preeminent position of the first world over the brown masses? To watch the great wealth of the modern age vanish down a dry bore hole?

Preposterous! So exactly what was Plan A?

It is a question that begs for an answer. Sir 'Lox, if I may ask, allow someone else to answer first. For others need to answer for themselves, as they walk in the footsteps of giants, where it is they are going, and perhaps review ALL of Boilermaker's suggestions. Gather ye golden grains yes, but do not follow the one-eyed son of Posidon too closely at unawares.

I refuse to be lunch, or breakfast (i or ii), or a trophy in a troll cave.

http://www.pbs.org/wgbh/amex/pipeline/timeline/index.htmlCheck out September 13, 1969.
My first civilian flying job after getting out of the army and Vietnam, was flying a helicopter on the North Slope.
I also remember flying over massive amounts of 48" pipe stored and rusting, at Fairbanks. It dosen't suprise me that they are now having major corrosion problems, since the pipe was already close to being unusable when it finally got installed.

"These pipes will lay rusting for more than five years before they are put to use."

Although there was unlimited money for the development of the North Slope field, apparently basic precautions were not taken.

I too recall that time period, as a time when an oil company paid for a Lear jet to fly a two hundred dollar part from Dallas to a seismic crew in that area just to avoid a brief delay in their survey. Sad that B.P. has not put much effort into maintenance.

...after all, does one care or think, when in the treacherous euphoria of elven draughts, of the consequences after? Ssss! (cackle) Nay, precious! Enjoy the moment, yess?!

For that is what all Citizens of the World have largely wrought, have they not? The World-Peoples has drunk freely of Oil... and felt the rush of Power that has whipped Technology to a frenzy far greater than any wisdom of Men - or Elves - could ever hope to keep up with. Ssss! But the barrel runs low, and the terrible hangover comes ssoon, O yess, and the purging of the poison - and the fantasies. But Smeagol will be happy enough digging taters if we musst (and fishing)in the world of yessterday... sss.. that is, if we lives to ssee it.

For that is all poor Smeagol ever wanted... to live simply at Nature's whims, and keep a little food (and a little Precious, O yess!) against lean times. O, we would welcome the return of an "agrarian past"... yess, even the ring of Gimli's hammer, even that, precious... if it meant rendering today's demonic sysstems into memories and nightmare devices of destruction into plowshares.

S.

Exchanging no great quantity of paper- if possible- for incremental oil. Exchanging, in total, as much as they'll take in quantity. Pump it till it's gone. Hope no one finds out too early, that they've been exchanging real wealth and power for, possibly, nothing in the long run. When interests are challenged, use fiat military to prop, destroy, and promote fiat nation. Step on gold, making fiat dollars appear to be something, for as long as is possible. Like right now.

I have to admit there's some interesting stuff in this interview to ponder...worldwide war as a last gasp for control before economic doomsday.
plus he talks about the willful destruction of the US industrial capacity...

...
LaRouche: You referred to Gingrich, who is not really a nice person, but who is not entirely ill-informed: that the fact is that Israel did not invade southern Lebanon, or conduct many other things it did, simply as something of Israeli interest. In point of fact, as we see now, as many of us warned that this could be the end of Israel. Israel was sent on a suicide mission, a suicide for Israel, into southern Lebanon, and everyone who is of military and related competence, who saw the facts, have agreed�and we've shared these facts with them�have agreed, that this is a suicide mission.

Now the fact that Israel is being expended when people have tried to use it as an instrument of policy in this way, indicates that we've come to the point, that the friends of Felix Rohatyn, of the Synarchist International, the same people who created Adolf Hitler, and then dumped him, but they created him, and who also are responsible for launching the Hitler who they knew was going to conduct some kind of genocide against Jews, these people are trying to push us to a real chaos: because they know that the end of their financial system as it exists now, is doomed. That some time in the very near future, unless fundamental changes are made by the U.S. government in particular, this system is going to crash�not into a depression, but into a dark age kind of depression.

So they are rushing at this time, to get control of the planet, which is why they're pushing for a global world war! Now! Not a local war, not a regional war. The attack, the terrorist attack in Mumbai, which was largely a British creation, this attack shows you very clearly, and other things from the U.S. Administration also show you, that they're headed for a new kind of world war, World War III in a new form, from which civilization might not emerge.
...

http://www.larouchepub.com/lar/2006/interviews/3331stockwell_july27.html

Sir Smeagol, our agrarian past may be re-awaiting us somewhere on the backside of the oil parabola. Possible growth industry for 2060...Harness makers?

http://www.humanevents.com/article.php?id=16208Fact or Fiction, Will Iran set off a nuke and light up the sky on Aug 21st or 22nd 2006. The anniversary of the Miraj. And what does this have to do with Free Gold. Does THE INVIABLE HAND have any inside info on this one.

A quote from Contrarian's post of Larouche: "they're headed for a new kind of world war, World War III in a new form, from which civilization might not emerge."

Is Larouche here alluding to the nuclear weapon? And if, as many are now asserting, that we are in WW3, wouldn't the West's principal advantage be to fight this at the highest level weaponry possible? Extermination style? So- since the West would be looking for the other side to start the proceedings from which we could then respond, should we be expecting a nuclear attack--possibly self orchestrated as a pretext to hit 'em hard?
Remember the Maine!!!

It is certainly easy to get frustrated and depressed with the unending morass that is the ME at the moment...which is heightened by the urgency in the industrialised nations associated with Peak Oil, and the "inconvenient truth" of global warming...

I must say, though, that I was heartened by an interview on Jim Lehrer's News Hour a few nights ago, in which it was apparent that large parts of the world community are very well aware of the dangers and threats associated with the looming end of the Oil Age and of the need for alternative energy sources and appropriate changes in the character of industry and society. The economy of "aletrnative energies" may proceed very rapidly with just a few enlightened regulatory changes that makes it advantageous for private enterprise to start creating new products and services and a framework for a new age. I suspect change will occur very rapidly, and the presently "primed" public may swing willingly, towards the new paradigm once the starting pistol sounds.

It is important, however, that governments do not dally too long in their reluctance to cast off the old ways...and even more important that they do not continue digging ever greater holes in the hope of finding salvation at greater depths of chaos and depravity. We certainly DO NOT NEED WWIII to teach us that there are better ways into the future. Einstein, when asked, said that he did not know what weapons would be used to fight WWIII, but that WWIV would be fought with sticks and stones!

The problem that we confront in Iraq and elsewhere in the ME exists as much in the minds of a few western leaders...strident, egotistical "poodles" and internationally naive "Texas cowboys" and "humble Howards" and the like. Having got themselves into a mess on the basis of misrepresentation and hubris, they may start to believe their own rhetoric. God help us if they do! We, the people, will risk being lead by these ratbags down paths that were never intended, never necessary and never ending; save by protracted and debilitating conflicts which no one can "win".

It takes a BIG man to stand up and admit he was wrong. Few men can do it. And that is very strange, because people greatly respect honesty and genuine humility in a person...

:-)

http://english.people.com.cn/200608/09/eng20060809_291239.html
Iran's Supreme Leader Ayatollah Ali Khamenei Tuesday called on Muslim states to get further united and guard against "conspiracies of enemies to cripple Muslims", the official IRNA news agency reported.
"Division is a lethal poison for the Muslim world and any action that would divide Muslims and serve enemies is a treason against the world of Islam," Khamenei told a rally on the birthday anniversary of Hazrat Ali, the first Imam of Shiites.
The Iranian leader noted that pitting Shiites and Sunnis against each other "is among usual conspiracies of enemies to cripple Muslims".

http://futures.fxstreet.com/Futures/news/afx/singleNew.asp?menu=latestnews&pv_noticia=1155055040-a0a30f08-32835
Lebanon, Israel and Syria -- a modest oil producer -- do not have significant weight in terms of energy
But Iran is the fourth crude oil producer in the world and a key member of the Organisation of the Petroleum Exporting Countries (OPEC). With 10 percent of world reserves, Iran produces around 4.0 mln bpd and exports about 2.5 mln bpd to Asia and Europe
Such a large output would be irreplaceable should a problem occur in current conditions because the gap between offer and demand on a world scale remains very narrow (between 1.5-2.0 mln bpd), offering little room for manoeuvre

http://www.chinadaily.com.cn/bizchina/2006-08/08/content_659841.htm
TRADE IN GOLD SPARKLES ON PRICE RISE
A sustained rise in the price of gold has ignited Chinese investors' enthusiasm for trading in the precious metal, the Jiefang Daily reported Tuesday.
+
Analysts expect the gold market to remain bullish until the end of the year thanks to a weak U.S. dollar and high oil prices.

http://www.kommersant.com/page.asp?id=695867
According to [Venezuela's President Hugo] Chavez, [Cuba's leader Fidel] Castro is recovering and can get up out of bed.

Date: Fri Nov 07 1997 22:37
ANOTHER (THOUGHTS!) ID#60253:
2 ) What will be the new world reserve currency once the dollar is hyper-inflated to zero or devalued?

Greetings,

I hope your treasure chests are stuffed full of delightful Gold coins and other life saving things.

If not tomorrow, it will be soon. I think the inevitable will hit us. The other day I had the oddest dream. I saw that the world was in turmoil. I also saw a bomb hit the middle east. Not the kind that is hitting them now, but an even more powerful one. The countries would all end up spoiled. Tainted with radiation and the oil was worthless.

The holocaust was sent to stop. In reality it is what started the chain reaction of more. No oil, economic collapse.

The ultimate suicide bomb!

Do you think they care if we nuke them or not? They are already in the cesspool of crisis. My observation. Blunt it may be, not much different than all the urls I've seen and have been reading!

So how much will my cute treasure chest of gold coins be worth if we end up in a Nuclear war?

"Keep your chin up and keep reaching for the stars"

.....seems like a stupid quote that was always mentioned if someting was bad.

.... is with you. I appreciate what Sir TIH brings to this Oaken table. I prefer a "discussion" board of information; relevant facts; and yes, opinions.

But please leave the out-of-line comments to the discussion boards and BLOGS elsewhere.

Calidor

PMs resuming their ascent in London as I hit the hay late this morning.

See you favorite charts for references.

http://www.mortgagenewsdaily.com/7312006_Home_Buyers_Market.aspsnip:

Home buyers have waited for years but perhaps the agony is over. It is official; the National Association of Realtors� has confirmed that we are now in a buyers' market.

According to the NAR June report on existing home sales issued last week there is now a 6.8 month supply of existing homes on the market. One year ago the supply was 4.4 months. The joint report of the Department of Commerce and the Department of Housing and Urban Development on new home sales contained similar news; the supply of newly constructed homes on the market will take 6.1 months to absorb at the current sales pace compared to 4.3 months one year ago.

-Goldilox

If buying into declining price market means "the agony is over", one might ask "for whom?"

I once tried to hire a very talented engineer who had purchased a home in LA during the '91 RE boom. In order to relocate, he needed a cash outlay of about $50,000 to cover his negative equity, and that was in the days when a 20% down payment was a "given". In this FED-insired market where 100 and 125% loan packages are available, the negative equities Johnny-Come-Lately home buyers of will reach -30% LTV in a heartbeat, and "leverage" and temporary low payment structures will evaporate.

Where will we find the next FED "bubble"?

We all know that the only answer they offer for corrective deflation is massive reflation, and that cash has to go somewhere to "earn" higher-than-official inflationary rates.

http://www.itulip.com/forums/showthread.php?t=292SNIP
The Fed did indeed learn something from the Great Depression: never reduce the money supply drastically, and especially, don't let the inflation rate fall below zero. The chaotic behavior of the global financial system even after this "lesson'' was learned suggests to me that this fundamentally command-based economic institution will always find a new way to screw things up. As this article shows, when working, all the Fed does is mimic non-fiat based monetary system, such as the gold standard. When the current fiat money regime is not working, it is doing everything but that. With a nearly infinite number of ways to screw up, and subject to the short-term interests of Wall Street and politicians, but only one way to succeed -- it imitate the gold standard -- suggests to me the Fed is not only not helpful to the economy, but harmful
UNSNIP

This chap repeats what happened in the Rubin/Summers period (Gibson paradox) where all the collaborators with the dollar International Financial and Monetary System (IFMS) had to bring the price of gold (POG) down to the $250 because in those days the degenerating M3 was still visible.
1994 had already announced this with a rate shock (to 10% on AAA-10 yrs) which HAD to be immediately neutralised.

Since M3 is no longer visible, the POG was allowed by the benevolent EMU/ECB to be set less unfree and to rise a little, after our masters had made sure that this rise would be gradual and not in a disorderly fashion. This COULD well be the reason why the Washington masters of the US of A concluded the Washington Agreement I and the Washington Agreement II.

When precisely would gold, according to A/FOA/TG, soar and would the euro take over the role of reserve currency?

http://www.usagold.com/GoldTrail/archives/ANOTHER1.html
Date: Fri Nov 07 1997 22:37
ANOTHER (THOUGHTS!) ID#60253:
GCH,
1 ) Why then did Hashimoto threaten to sell US SECURITIES and buy gold?
He will do both, but not in order or in amounts supposed. The BOJ is buying gold now , much more than assumed. They will sell US debt but only after a RISING OIL PRICE runs the US$ thru the roof. Even then it will be as minor currency management!
2 ) What will be the new world reserve currency once the dollar is hyper-inflated to zero or devalued? E-gold, gold itself or nuclear weapons?
I don't know, but we will all find out!

The Gold Trail Five
http://www.usagold.com/goldtrail/archives/GoldTrailFive.html
FOA (08/06/01; 09:37:25MT - usagold.com msg#91)
Gold Mobilization
If foreign political motive decides to no longer support international dollar denominated gold derivatives with physical delivery or refrain from using gold as a trade settlement; the US will have to choose between shipping it's gold or seeing all international DOLLAR STRUCTURE AND USE FAIL! In it's place, Euro system currency would easily become the main reserve as SOARING GOLD values would replace "tender" value lost from dollar failure.

According to A/FOA/TG, gold would soar and the euro would take over the role of reserve currency, ONCE THE DOLLAR STRUCTURE AND USE WOULD FAIL.

The dollar is not yet broke. That's why gold is not yet soaring.

With oil at $80, it may be a matter of days
(before August 21 or 22 when Iran set off a nuke and light up the sky
Peculium Aurum (8/9/06; 00:08:54MT - usagold.com msg#: 146481)
before oil will be priced in euro.

Then the dollar could be broke and the gold could soar.

In the meantime, it is of the utmost urgency that holders of dollar-papergold start learning to walk on physical (not invisible) eurolegs WITHOUT there being two currencies which are constantly fighting for supremacy.

Those in the know can only profit from the fact that the world economy continues to survive on its dollar debt mountains. There is indeed not enough gold available in order to convert the existing dollar debt amounts into gold. That's why gold has to rise exuberantly, but not rise in worthless dollar but in a currency which marks its gold reserve to market(-price), the euro.

The dollar-IFMS can now slowly be allowed to collapse. There is an alternative, the euro, available. This alternative will take over the role of reserve currency.

Fact, Fiction or Fearmongering?

The first mention of the Aug 22nd Iranian Nuclear threat that I'd come across was authored by Bernard Lewis. Who is Bernard Lewis?

...and the backing that neoconservatives like Paul Wolfowitz and Richard Perle and experts like Bernard Lewis provided the administration when it was attempting to win public support for the war. -- http://www.nybooks.com/articles/19062

.... Since then we have met often, particularly during the last four-and-a-half years, and Bernard has always had some very good meetings with President Bush. He is always objective, thoroughly candid, and completely independent. � Dick Cheney http://www.whitehouse.gov/news/releases/2006/05/20060501-3.html

AND
Mearsheimer and Walt's essay, meanwhile, has been the object of much study by AIPAC's research unit, which intently follows the activities of critics of Israel and of the lobby. Its "Activities Update," a compilation of dozens of press clips, speech transcripts, and minutes of meetings, is periodically e-mailed to a select list of AIPAC supporters. This research provides the raw material for AIPAC's efforts to intimidate and silence opponents. The editor of "Activities Update" is Michael Lewis, the son of Bernard Lewis, the Princeton scholar and interpreter of the Arab world who gave advice to the Bush administration in the months preceding the war in Iraq. -- http://www.nybooks.com/articles/19062

It appears to me as the administration has put their spin-team to work in an effort to head-off Mr. Lewis� dark vision. The question in my mind is what "preemptive" measures are in the works. No doubt the coming days will provide us with "intelligence" on Iran's nuclear schemes. What does this have to do with gold? I'm not really sure but, if Iran is attacked that has much to do with the price of oil.

I wonder if anyone else has noticed how this administration seems to prefer shaping policy from a position of chaos. Rather than tinkering around the edges, it's chosen method seems to be destroy then rebuild. Whether it is the US export base, Katrina, or Iraq. An attack on Iran would put the Middle East in a position that meets my definition of chaos.

http://news.scotsman.com/politics.cfm?id=1156872006
Golden Lionheart (8/8/06; 08:56:26MT - usagold.com msg#: 146452)
The Invisible Hand........You are quite rude.
@ The Invisible Hand..............I find your constant reference to the Prime Minister of Great Britain as "the poodle" as an insult to the citizens of the UK. Wash your mouth out kind sir!

http://www.guardian.co.uk/israel/Story/0,,1840239,00.html
Angry MPs demand recall of parliament
Discontent over UK's Lebanon policy
Patrick Wintour, Ewen MacAskill and Oliver Burkeman in New York
Wednesday August 9, 2006
The Guardian
Up to 100 MPs, most of them Labour, are to demand an immediate recall of parliament to debate the crisis in Lebanon because of growing fears about the government's strategy.

http://news.bbc.co.uk/1/hi/world/americas/5255452.stm
A prominent US Democratic senator says he is planning to run as an independent candidate after losing a mid-term primary in Connecticut.
Joe Lieberman, who stood for vice-president in 2000, lost to anti-war newcomer Ned Lamont.
+
Mr Lieberman, a senator for 18 years, has been harshly criticised in his home state for his support for the Iraq war

==

Tony the Poodle may have to postpone his Caribbean holidays.

He didn't postpone!

http://news.scotsman.com/politics.cfm?id=1156872006
The pressure on Mr Blair came as he arrived in St Lucia today on his delayed Caribbean family holiday.
Before flying out to Barbados, the Prime Minister used a final round of broadcast interviews to express his hope that agreement on a United Nations Security Council resolution was imminent.

==

Is this not political suicide?

Jim Cramer pimping buggy whip companies.

C!

If Blair was not the Poodle of the bush,
- the motion demanding an immediate recall of parliament would not emanate from MP s from his OWN LABOUR PARTY,
- he (Blair) would have the bXXXs to answer parliament's questions and would not leave to the Caribbean.

How come the Conservative Party is happy with Blair's War Policy?

http://news.bbc.co.uk/go/pr/fr/-/2/hi/business/4775359.stm
BANK OF ENGLAND HINTS AT FURTHER RATE RISES

SNIPS
The Bank of England has hinted that UK rates may have to rise further in coming months in order to keep inflation on target at 2%.
+
The news comes a week after the Bank raised rates to 4.75% from 4.5%.
The Bank's governor, Mervyn King, said the Monetary Policy Committee had opted to raise rates "against a background of firm growth and limited spare capacity and with inflation likely to remain above target for some while".
+
"There remains great uncertainty about future energy prices, especially in the light of political tensions in the Middle East, and inflation is likely to be volatile over the coming months," Mr King added.

About the Bank of England's further raising of the interest rate:

Let's not forget that in today's world, each and every central bank of the world is obligated to expand credit continuously, because any reduction in the creation of more credit � actually debt, for those using the credit � means that the whole previously created credit structure is threatened with collapse.

So all talk about "reining in inflation" is just talk. Inflation of credit, which means inflation of the supply of money, is built-in and all central banks of the world are trapped in the sense that they have no option but to continue expanding credit and the corresponding money supply.

Talk of reining in inflation is just an attempt to manipulate public perceptions. Furthermore, the inflation to which central banks refer is always and everywhere, the inflation of PRICES, which is nothing but one of many consequences of increasing credit and expanding the money supply.

An increase in the price of oil is not in itself inflationary. If the price of oil rises, then it is true that other prices of goods and services affected by the increase of the price of oil, may tend to rise.

However, those prices will not be able to rise unless there is creation of additional money to ENABLE those higher prices to stick. And we can be certain, that additional money is being created by each and every central bank in the world. Including the venerable B. of E.

The Bank of England is not by any means going to put a stop to the creation of additional credit and money supply. They are only diddling with the interest rate in a psychological-operations activity, to confuse the public and do what they can to prevent financial collapse. Rising prices all over the world are inevitable and only a manifestation of what is really a falling value of money. Until the final runaway hyperinflation and collapse takes place.

Buy gold, at any price.

http://www.usagold.com/amk/newsgroup-form.html

http://www.newyorker.com/fact/content/articles/060710fa_factThe tension is so thick that one can almost cut it with a knife...

http://www.thenewstribune.com/business/story/6013113p-5281599c.htmlAssociated Press; August 9th, 2006 --

Richard Bernstein, chief investment strategist at Merrill Lynch in New York, said investors should be concerned about today's geopolitical environment, but noted that they needn't suffer financially.

"The world is an unsafe place that is getting more unsafe," said Bernstein. "What people are underestimating is the longevity of this story."

Bernstein does not view the United States� current nuclear standoffs with Iran and North Korea, or rising terrorist activities around the globe, as short-term events.

But he offered a solution in the form of an offensive investment strategy, one that aims to profit from the market fear and military buildup that accompany such global instability.

Bernstein pointed to large arms purchases by China, Venezuela and other countries as a leading indicator of future U.S. military spending. As a result, he said the defense sector � "the grim reapers of the equities market" � is the place to be.

Bernstein said retail investors also should consider putting more money into traditional safe havens such as gold, treasury bonds and perhaps simply certificates of deposit, which are becoming more attractive as interest rates rise.

...both Alan Gayle, senior investment strategist for Atlanta-based Trusco Capital Management, and Bernstein noted that they have been recommending that investors reduce their exposure to equities for several months.

... Charles Biderman, chief executive officer of Trim Tabs, cautions retail investors against trying to time � or outsmart � the market...

While there might be fear in the market, HighMark Funds chief investment officer David Goerz said consumers should consider the possibility that things might not turn out so badly.

"Often times, these times of crises are transitory," he said.

^---(from url)---^

The final analysis will likely show that it would have been much more appropriate had David Goerz used the term "transitionary" rather than "transitory".

Is your portfolio currently designed to withstand a significant change in the make-up of the international monetary sytem's primary reserve assets?

Choose gold.

R.

Political disinfo

http://www.paramountgold.com/News/2005/08-09-2006.aspHowdy,

With the price of gold rising higher and higher it looks like mining is taking on new luster also.

How could this change the PoG?

With increased mining and increased demand will it cause GOLD to rise or perhaps drop?

Dose mining explorations even influence the price of gold?

We can see how OIL demands and output greatly effects the over all price per barrel. Gold seems less sensitive. Is it because of its artificially being held down?

Just a thought instead of all the war and political bushy poodle crap!

http://www.usagold.com/DailyQuotes.html
The Daily Gold Market Report has beenupdated.

If you are considering investments in gold we invite you to request our freeintroductory information packet detailing the products and services offeredby USAGOLD ~ Centennial Precious Metals. We welcome your inquiry and lookforward to working with you.

WEDNESDAY Market Excerpts

Gold up on oil strength and dollar weakness

August 9 (from DowJones) -- Despite selling overnight following the U.S. Federal Reserve's rate hike pause late Tuesday, Comex gold futures settled higher on Wednesday at the New York Mercantile Exchange amid a weak U.S. dollar.

At the close, December gold settled $4.70 higher at $662. During the session, the contract traded to a high of $666.50 an ounce - its best level in a week. It moved off the high near the close amid some light profit taking, traders said.

Analysts at MKS Finance in Geneva said in a daily comment that the general market sentiment remains bullish: "Firm oil prices and the ongoing Middle East conflict continue providing a support for the yellow metal as it increases its safe-haven appeal," the analysts said, adding that Israeli forces are said to have pushed deeper into some parts of south Lebanon Wednesday as Israel's inner cabinet approved an expansion of the ground offensive.

On the physical side, traders said gold will draw some support from the awaited pick up in the physical demand expected at the start of the Indian wedding season from the end of August.

---(see url for full news, 24-hr newswire)---

The USD continues to behave like a drowning man who has been tossed an anchor. The anchor is the war in Lebanon. Who is going to pay to clean up this mess? The answer is the US government who has paid for all the bombs and supports the destruction of Lebanon. In the world court where this will finally be played out the US will be held liable for all the destruction. They could have stopped this carnage before it happened, but instead choose to rush more bombs to the scene and stand in the way of the rest of the civilized world seeking a cease fire.
Lebanon has been bombed back to the stone age, it will cost billions to bring it back. The US will pay for this and continue to pay for their stupidity in Iraq. The USD is headed toward .60 then .40. What will be the price of gold then?

Ref TIH #146491 "Is this not political suicide?"

...shades of Anthony Eden...again a Middle Eastern crisis.

Eden was very unwell...both in body and mind. It spelled the end of his career...

What about Tony?

:-(

An excellent read on the subject of bank credit inflation..."The Grip of Death: a Study of Modern Money, Debt Slavery and Destructive Economics".

http://www.gata.org/node/4302An appeal from GATA Chairman Bill Murphy
is the latest GATA dispatch.

Out of curiosity how much of Nova's production is sold forward and what is free and clear?

NovaGold is still an exploration and
development company and while it has
huge resources and several big projects,
the company is not yet producing gold.

How much of Barrick's production is sold forward? How much free and clear?

Why aren't they in production?

They're not in production yet because
mine construction plans are not yet
drawn up. Barrick is supposed to do
that within a year, having inherited
the obligation by taking over Nova's
previous joint venture partner,
Placer Gold. But it is established
that Nova has huge gold and copper
deposits.

Let me make sure I've got this right. The value of Nova is dependent on the company that is trying to take it over?

http://www.theconservativevoice.com/article/16785.htmlby Abbas Bakhtiar
U.S. and The Coming Financial Crisis
August 07, 2006 11:25 AM EST

If the dollar continues to weaken in value, and there is the possibility of purchasing oil in Euro [at the Iranian Oil Bourse], then these countries would unload their dollars for safer currencies such as Euro. What will then happen to the value of dollar?
+
The current American deficit and its long-term financial obligations, if goes un-answered, will sooner or later lead to either a marked increase in interest rate or a substantial devaluation of dollar.
+
At the end of the WWII 45 nations gathered at a United Nations Monetary and Financial Conference in Bretton Woods, New Hampshire to address the problems of reconstruction, monetary stability and exchange rates,.
+
An initial loan of $250 million to France in 1947 was the World Bank's first act. Since then there has already been considerable criticism of the roles of IMF and the World Bank. The above mentioned problems and the ongoing trade imbalance in the world have to be addressed by a similar gathering. Sooner or later, both the United States and the rest of the world have to address the existing problems. This problem is not United States alone. We can not ignore the largest economy on earth. It is said that if United States sneezes, the world catches cold. We have to either make sure that United States doesn't catch cold or vaccinate ourselves against it.

http://politics.guardian.co.uk/homeaffairs/story/0,,1840723,00.html
MP resigns over Middle East crisis
The government today suffered the first resignation over its stance on the Lebanon crisis.
+
I can no longer support the government's position of calling for restraint on both sides of the current conflict in Lebanon whilst, in my view, facilitating the refuelling of aircraft in our country that are carrying real weapons of mass destruction, as seen on our television screens," Mr Sheridan added.

http://www.iranmania.com/News/ArticleView/Default.asp?NewsCode=44961&NewsKind=Current%20Affairs
Iran's monetary base down over 10%
SNIP
According to experts, controlling and curbing the increasing growth of monetary base are the most effective method in keeping inflation in check, and it seems the monetary policies are directed to this end, the report indicated, adding the inflation rate, now at 10.4 %, may follow a downward trend hereafter.

http://www.news.com.au/dailytelegraph/story/0,22049,20070030-5006506,00.html
The US Government said Saudi Arabia and Mexico had pledged to help meet any supply shortfalls, but also warned that full production from Prudhoe Bay might not resume until January

This story reports that Barrick is estimating this year's
gold production at between 8.6 million and 8.9 million
ounces:

http://yahoo.reuters.com/news/articlehybrid.aspx?storyID=urn:newsml:reuters.com:20060802:MTFH86186_2006-08-02_22-44-04_N02334023&type=comktNews&rpc=44


This report says Barrick's hedge position is now 12.3
million ounces:

http://www.resourceinvestor.com/pebble.asp?relid=22356

Flaccus, the valuation of NovaGold does
depend to an extent on the valuation and
conduct of its joint venture partner,
Barrick. Barrick is obliged to invest a
certain amount of money to advance the
Donlin Creek project to a certain point
by a certain date, 2007. If Barrick
does so, it can claim a big share of
ownership of the project. If it fails to
do so, NovaGold gets to keep that share
of the project as well as its residual
share. That is, the share of Donlin
Creek that NovaGold will end up with is
in question, a question that rests with
Barrick.

I was told you couldn't talk about stocks here because the owners of this site want to sell maples. I guess you haven't been told?

I've made my point and will not pusue it further. Own the metal, not the potentiality.

My take over a lot of years camping here is that management here doesn't want to be responsible for creating the greater fool.

By their actions you shall know them.

My comment was a well recognized TA set up. No blind leaden the blind here brother. It wasn't a recommendation, it was purly academic.

http://globalpolitician.com/articledes.asp?ID=1981&cid=2&sid=4SNIP
According to Iran News and Iranian Culture Journal of July 6, Iran will start the initial phase of its planned Iranian oil bourse at the end of September. An oil ministry official told that his ministry had already presented the relevant documents to the economic and finance ministry and the bourse organization. See also: Structural Changes � Destruction Of The U.S. Dollar

Google found this � link does not work
http://www.new-europe.info/new-europe/displaynews.asp?id=126559
Iran will start the initial phase of its planned Iranian oil bourse at the end of September, the news agency ISNA reported last Wednesday.

==
Mr. Goldfinger don't you know how important the bXXXXXXs think AntiTrust law is for this civilisation?
So if you have that in your name, have a free hand to do and say everything you want.

As one Alan Greenspan wrote:
"The world of antitrust is reminiscent of Alice's Wonderland: everything seemingly is, yet apparently isn't, simultaneously. It is a world in which competition is lauded as the basic axiom and guiding principle, yet "too much" competition is condemned as "cutthroat." It is a world in which actions designed to limit competition are branded as criminal when taken by businessmen, yet praised as "enlightened" when initiated by the government. It is a world in which the law is so vague that businessmen have no way of knowing whether specific actions will be declared illegal until they hear the judge's verdict -- after the fact."

Druid: TIH, not to overshadow Maximus, These have always been two of my favorites:

"Think now, if you are a person of "great worth" is it not better to acquire gold over years, at better prices? If you are one of "small worth", can you not follow in the footsteps of giants? I tell you, it is an easy path to follow!" --ANOTHER (THOUGHTS!) 1/10/98"

and

"ORO (11/13/99; 21:24:14MDT - Msg ID:19061)
..You may have seen the movie Matrix. The story is of humanity being used as production plant for something, the people live a life completely within their heads, controlled by computer simulations. The key to the hero's survival and success is realizing that the world around him, in which he grew up all his life, is completely false. Walking through a room full of people trying to free themselves from the images bombarding their brain, he crosses a kid bending a spoon. He asks the kid, how did he bend the spoon. The kid says, it's simple, there is no spoon.

What is played before us in the world is a hoax that you have been conditioned by daily experience to accept as reality. But there is a cost to the charade and a cost to you. But you can't bring yourself to come to the conclusion when you watch CNBC, read the Journal or Investor's Business Daily, see Moneyline, Ruckeyser, etc. that they are involved in a theatrical production; that they are like well trained actors in a drama about money that never was. Remember: There is no spoon."


literally, here at the castle, a recorded history in the making as left by so many gifted thinkers who stopped by to honor so many of us with their thoughts and presently continuing into an uncertain future.

"The problem that we confront in Iraq and elsewhere in the ME exists as much in the minds of a few western leaders...strident, egotistical "poodles" and internationally naive "Texas cowboys" and "humble Howards" and the like. Having got themselves into a mess on the basis of misrepresentation and hubris, they may start to believe their own rhetoric. God help us if they do! We, the people, will risk being lead by these ratbags down paths that were never intended, never necessary and never ending; save by protracted and debilitating conflicts which no one can "win"."

Sir Sundeck, you have to quit drinking that Kool-Aid. How silly! You couldn't be more wrong. White Hills

Have ordered "The Grip of Death" by Rowbotham. I look forward to receiving it and reading.

Sierra

http://www.safehaven.com/showarticle.cfm?id=5675&pv=1by Douglas V. Gnazzo

donnemuir #: 146504 Thanks for the link. & Sierra Madre #: 146495, good read, thanks.

On a similar track... Snippets:

Thus all paper fiat monetary systems are destined to one fate - they must inflate or die, there can be no other way.

The supply of money must increase at least by the prevailing rate of interest. Central bankers must yearly create at least as much new money as needed to service the outstanding debt. Monetary growth cannot be below the rate of interest on an aggregate basis.

When we look around the world we see one dominant theme or paradigm that is attracting money flows: paper is out and tangibles are in. Commodities have been the recipient of large flows of liquidity, and have responded in kind.

http://www.resourceinvestor.com/pebble.asp?relid=22676Snip:

"...
On August 2, Chavez visited Mali, a landlocked, western Africa country, just south of the Sahara.

Mali is Africa's third largest gold producing country, but also incredibly poor. Chavez offered energy assistance in the form of crude; however, as expected there is a trade-off involved.

"I will give Mali $100 million a year in petroleum products and I do not want payment in cash. I don't want you even to say thank you," Chavez said.

But, why settle for cash when a harder, denser and incredibly valuable form of currency will suffice in place of fiat money.

"But I do need your mineral products like bauxite, gold and fertilizer...," Chavez was quoted as saying in a Reuters article.

Venezuela also offered to assist Mali in searching for oil reserves in the country.

It is interesting to look at Venezuela's huge oil reserves and relatively low mineral reserves in comparison. So, why not trade? Countries can keep gold as a currency, whereas oil is put on the markets, sold, and used. Interestingly enough, Chavez chose the country with the continent's third largest gold production rates to offer a helping hand.
..."

Sundeck: What's this? A barter way to do business than by using dollars? Exchange of oil for gold? (Now who would have thought of that?)

Mmmm...Mali is a significant gold producer and this barter, if and when it gets under way, will have the effect of lifting gold supply directly off the market...

Interesting?

.............

@Sir White Hills #146523

"Silly"? "Wrong"? Perhaps you are right; but anyway, thanks for the backhanded compliment.

;-)

http://www.newmediaexplorer.org/sepp/2003/06/07/original_blueprints_for_200_mpg_carburetor_found_in_england.htmIf we could turn the hands of time back to the 70's when we had a chance to really make a difference. History could have been rewritten. The mess we have now might not even be. WARS and turmoil over something that destroys our environment and creates greed.

What happened to all the carburetors that could get well over 100 miles a gallon?

Where did all the technological breakthroughs disappear?

I think we have an answer to this. Huge oil profits and NOW they will only get bigger. Did anyone think that perhaps all this planning would cause this huge POWER grab? OIL! I wonder who has who by the B___S now! I am ready for oil to move to 250 a barrel. I know how to ruff it. I bet those better gas guzzling autos are on their way back...I see this all benefiting the POG and I am ready to see it FLY!! SO BUY!!


This is a comment in response to a few of your posted URL'S and other writings that make my blood boil....WITH GOLD!

The Invisible Hand (8/9/06; 20:52:29MT - usagold.com msg#: 146521)

Tony seeks a tan of gold,
Where pirates buried wealth untold,
And slaves were brought and then were sold...
...the sunny Caribbean.

As "poodles" go, he's not so old,
His diction clipped, his manner bold,
His morals pure (or so I'm told)...
...the purest ever seen.

Who is better to uphold,
Britannia's stance beyond the fold?
Great thoughts, great deeds, great faith...behold!
...resplendent in his sheen.

......

Alas! Poor Tony's ship is shoaled,
His countenance grows grey with mould.
His policies, 'though once extolled...
...now reek like raw gangrene!


Sundeck
10 August 2006


Dedicated to Truth and Justice

:-)

A funny spike currently at Kitco down to zero and again back up.A timely reminder on what can happen in the paperGold pit.How is POG reported in FreeGold?Just Another price from a new exchange?

Snippet - MSNBC

LONDON - British police thwarted on Thursday what they said was a plot to blow up aircraft in mid-flight between Britain and the United States and arrested more than 15 people.
Both countries stepped up security, causing severe delays at airports following the revelation of the plot, which a police source said was believed to involve a "liquid chemical" device.
"The police acting with the security service MI5 are investigating an alleged plot to bring down a number of aircraft through mid-flight explosions, causing a considerable loss of life," Interior Minister John Reid said.
The U.S. Department of Homeland Security raised the threat level for all commercial aircraft to high and U.S. authorities banned liquids, including drinks, from all U.S. commercial flights.
Britain's security services raised the threat level in the country to "critical" from "severe," the highest of its five ratings which means "an attack is expected imminently."

From yours earlier:

Mr. Goldfinger (8/9/06; 20:05:50MT - usagold.com msg#: 146516)
Chris Powell
I was told you couldn't talk about stocks here because the owners of this site want to sell maples. I guess you haven't been told?



Only my thoughts but from reading Chris Powell for many years and understanding his intentions in respect to the gold business, he did not talk of gold stocks per se. Instead he talked of gold companies, Barrick and Novagold. This may seem like spliting hairs but his title bar in message #146505 says it all:

"Don't let Barrick steal NovaGold to feed the gold suppression scheme"

If you follow the thread of msgs 146505-146511, 514 & 515, it is clear the subject is not of stocks but of Barricks probable intentions with NG's vast reserves.

If there was any connotation towards gold stocks, which I doubt, it would be negative if anything.

Hope this helps.

http://www.alternet.org/story/40008/

By Martha Burk, Ms. Magazine. Posted August 10, 2006.
SNIPS
Whether supporting repressive regimes abroad or giving tax breaks to ExxonMobil, U.S. priorities are consistent: Oil wins over women's rights.
+
Next up on the U.S. war-plan stage is Iran -- with the second-largest pool of untapped oil in the world. Although the ostensible reason for a U.S.-led invasion of Iran will once again be weapons of mass destruction, the politics of oil are peeking out from behind the WMD curtain. If Iran realizes its alleged goal of becoming the dominant center of Middle East oil commerce through a new oil exchange (the Iranian Oil Bourse) the currency would be the euro, not the dollar. Some analysts say that if petrodollars become petroeuros it could lead to a huge drop in value for American currency, potentially putting the U.S. economy in its greatest crisis since the 1930s.


http://usa.mediamonitors.net/content/view/full/34026

Reparations for Iran
by ROSEMARIE Jackowski
(Thursday August 10 2006)

"One has to ask the question, how many civilians have been killed by Iran with nuclear bombs?"

SNIPS
On August 19, 1953 the government of the United States executed a coup d'etat in Iran
+
The United States owes reparations to the people of Iran. How much should be paid for the 1953 coup? How much is a democracy worth? Here's a thought. Suppose the U.S. gave all of its nuclear weapons to Iran. Would that be a win, win, win scenario? The world would be safer because the only nation that had ever used nukes would no longer have any. The people of Iran would be compensated for the 1953 coup. The U.S. taxpayers would be spared a bill for reparations.

http://business.timesonline.co.uk/article/0,,9063-2306743,00.htmlSNIPS
Investors today battled against heavy falls in London's leading shares after M15 raised the UK security threat level to critical in the wake of foiling a major terrorist plot to explode aircraft in flight
+
oil fell $1 to $76.14 and gold rose from $651 to $661 a troy ounce.

@TIH,

The war spin must be whooped up when markets are tumbling, as the financial PTB need scapegoats along with completely fabricated statistics to mask more serious failures. They can rally the masses around a story like "Terrorists cause dollar and Sterling drops", but how on Earth can they keep the sheeple in line when the story lines are, "Dollar drops on continuing US bankruptcy", or "Sterling loses even more confidence than when Brown sold off its support structure on the cheap".

Whether the "clear and present danger" is real or fabricated is not even the issue. The public is continually sidetracked from financial slight-of-hand to political finger-pointing. This is the same tired disinformation trick of the same Money Masters who beat war drums to obscure the failures of the "men behind the curtain." Read: "Maine", Lusitania", "Pearl Harbor", "Tonkin", "WTC", etc. - the pattern is never altered a bit. The sheeple keep buying the "news" exactly as the "bought-and-paid-for" wire service feeds it. Even "investigative" reporters are completely anachronistic, replaced by pretty "talking heads" that read directly from the wire service script, and CIA 'heroes" like Ollie North who deliver us disinformation by day, and heroin by night in the coffins of our dead soldiers.

Just as US gold was diverted to "rebuild" Weimar Germany after the WWI "reparations" destroyed its chances of economic recovery, US and UK resources have been tapped over the last half century to first build, then destroy the ME, in an effort to control of the resources and commerce in both phases.

The sheeple have no more idea what's really going on in the ME now than they did when grandpappy Bush and Roosevelt were feeding the Nazi War machine with the pilfered savings of US workers who were left standing in the 1930's soup lines. The wealth confiscation model was recently retested with a new "twist" by the Bush-Clinton Katrina Charity that has yet to redistribute a single dime of their $400M in telethon collections. PT Barnum at his best could not emulate these guys.

It only takes a quick look at the negative US savings rate, soaring government and trade deficits, and continuous oil supply crises (while serious alt energy research still receives NOTHING but lip service) to see that the seeds of bankruptcy that brought Hitler to Germany are being sown in the US and UK today.

The World Trade Center "event" was but a proxy for the collapse of Anglo-American hegemony. And it is being "pulled" every bit as much as WTC-7.

Oh, and the resurgence of Newt Gingrich and his remarks that "dissent at the polls amounts to insurgency" shows their true disdain for any "real democracy."

Well said. You're right on target. So few see what's happening. And fewer still try to do something about it.

Henry

http://www.lemetropolecafe.com/img2003/memoformotiontodis.pdfThanks, Ned, for clarifying my point: that
Barrick's attempt to acquire NovaGold is
important less for the valuation of those
companies than for the impact on the price
of the metal itself.

That is, Barrick is admittedly a mechanism
used by central banks to suppress the
price of gold, an admission made by Barrick
in its motion in U.S. District Court in
New Orleans to dismiss Blanchard & Co.'s
anti-trust lawsuit. (That motion can be
found at the link above.)

Barrick claimed that the lawsuit should be
dismissed because, as the agent of the
central banks in the gold market, the
company should share their sovereign
immunity from suit.

As long as Barrick is the agent of the
central banks in the gold market, investors
in physical gold have as much interest in
the company's activities as investors in
mining shares do. What Barrick does has a
huge depressing influence on the daily
price of physical gold.

http://www.thestreet.com/_yahoo/funds/etf/10302814.html?cm_ven=YAHOO&cm_cat=FREE&cm_ite=NAETF,SCHMTF...

http://www.fms.treas.gov/gold/current.html
Druid: Interesting data.

Whereas Tony the poodle went on holiday, 9/11 is being replayed.

It is very surprising that CNBC manages to calm the atmosphere. Did they get training?

They are debunking the intraday gold price behaviour (volatility) in a contained triumphant manner/way. The manner implies "We've got everything under komplete kontrole, including the fitting terror atmosphere, of course."

The dollar-kompleks (including the neocon-NWO) is working very smoothly and boosts of self-konfidence in all areas (very VISIBLE self-complacency with ever fewer reserves).

Wait until the invisible hand takes over.

Nuclear warheads, said you?

What is the relevance of a possible Barrick/Novagold merger?

In other words: How can 500 or even 1,000 tonnes of "underearth" gold (forward sales) influence a total volume of 160,000 "upperearth" gold?

Were there no goldmines after 1971? The annual level of mined gold evolved from 1,000 tonnes to the present 2,500 tonnes? Was therefore the price of gold not continuously contained/governed/managed since 1971?

Do you prefer cheap purchaseable gold metal or rather rising gold stocks?

If gold mines are being plundered by having to mine cheap gold, why don't you advise (the very rich among) us to buy directly from the mines? Right, our host wouldn't allow that. Why don't you do that on your website?

I believe this is just more Federal Reserve/ International Banker Manipulation. Maybe even a practice run in anticipation for when the real big terror event arrives in the next couple of months. The bankers want to see how much money they will need to get the desired effect on gold prices. This is a dry run to see how the financial system will react.

I think there is going to be a nuclear bomb going off in a major American city soon and gold will be hammered again only more vigorously. Gold stocks will get creamed since in the stock market panic that is to follow margin calls will happen and people will prefer actual gold metal to stocks. I hope to get rid of my remaining gold stocks and buy both physical gold and gold stocks with both hands when the nuke goes off.

http://business.iafrica.com/news/919925.htm10 Aug 2006 -- Gold's production decline came under the spotlight on Thursday, as Statistics SA said production plummeted 9.5 percent year-on-year in June.

Much of this decline in output can be explained by the long-term trend of falling gold production, as ore deposits at the surface have become increasingly depleted.

June's disappointing gold production figures bring to an end a poor second quarter for the sector. Gold production for the June quarter 2006 plunged 6.9 percent lower than the same quarter last year, despite the value of gold sales climbing steadily on the back of a higher gold price

Gold sales surge

Sales figures for May show that gold sales increased by 39.4 percent year-on-year, in a month in which gold production fell by 12.8 percent year-on-year.

While higher gold prices should be encouraging producers to increase output at the margin, physical supply constraints undoubtedly remain in the sector, and may be adding to the upward price pressure.

...Recently gold producers have signalled their intent to invest in operations to mine ore at greater depths. Mining houses have indicated that the constraints to mining ore at greater depths have not been technological but rather economic.

^--(from url)---^

Bottom line: Mines are NOT profit centers. Always struggling against depletion of their orebody, as gold prices go higher, they respond by mining marginal ore at increasing cost. Hence, no dividend joy for shareholders as a result of higher gold prices as time marches forward. Choose the metal if you want a gold-related investement to treat you right.

R.

"Nukular" will show up somewhere. Instead of depleted uranium, "hot war" or dirty nuke possible
but financial meltdown certain. Better
to have gold than paper.

http://www.usagold.com/DailyQuotes.html
The Daily Gold Market Report has beenupdated.

If you are considering investments in gold we invite you to request our freeintroductory information packet detailing the products and services offeredby USAGOLD ~ Centennial Precious Metals. We welcome your inquiry and lookforward to working with you.

THURSDAY Market Excerpts

Gold dips as oil drops on airline plot

August 10 (from Reuters) -- COMEX gold took a dive on Thursday and along with oil prices ended with steep losses following news that an alleged airline bomb plot was disrupted that investors saw reducing demand for jet fuel down the road, traders said.

Britain and the United States stepped up security and London's Heathrow airport ground to a near standstill, after UK officials said they thwarted a plot to blow up trans-Atlantic flights between the two countries.

The news reined in oil prices that had risen to record highs this week on BP's decision to reduce output at its Prudhoe Bay oilfield in Alaska, the biggest in North America, because of pipeline corrosion.

Analysts speculated that the latest bomb plot might reduce air traffic and therefore the need for jet fuel, recalling the slump in fuel demand that followed the 9/11 explosions at the World Trade Center in New York.

On Thursday, when oil prices slipped about $2 to levels below $76 a barrel, gold went with it. "Oil's down, gasoline is down... with all the planes that will be canceled, and fears that people who were thinking of travelling would put off their plans," said one gold dealer in New York.

COMEX December delivery gold ended with $16.0 losses at $646.0, with range that dipped to $645.50 from a $665.10 high.

The dollar climbed further against the euro after U.S. trade data showed the international trade deficit [$64.8 billion, 5th highest on record] narrowed slightly in June, but was in line with forecasts even as high energy costs kept it near historically high levels.

"The dollar got quite a bit stronger today against the euro. There wasn't much of a move up in gold that you would expect when you hear of a terrorist plot. But since nothing happened and they were ahead of these guys, it was a big plus," a gold trader said.

---(see url for full news, 24-hr newswire)---

"Druid (8/10/06; 14:27:48MT - usagold.com msg#: 146539)
(No Subject)
http://www.fms.treas.gov/gold/current.html

Druid: Interesting data."
----

I have studied the Report and the explainations at the bottom of the data, and sent the following QUESTION to the Department for an ANSWER. -- PERHAPS someone here can answer the QUESTION, or, shall I hold my breath until I get an reply ?
<;-)


=====
RE: Department of the Treasury
Financial Management Service
STATUS REPORT OF U.S. TREASURY-OWNED GOLD
June 30, 2006
--
Total - Federal Reserve Bank-Held Gold 13,452,783.620 Troy Oz.
--
Please advise me WHY this gold is being held by the Fed Reserve ?
Thank you !
GW

http://www.usagold.com/DailyQuotes.html(from MarketWatch) -- Security authorities in the U.K. arrested up to 21 people and halted flights to Europe and the U.S. after foiling a plot to blow up as many as six airplanes.

The plot revolved around bringing liquids that could explode on board planes through hand baggage.

All those arrested were U.K. nationals of Asian descent, reports said.

The Associated Press reported, citing unnamed U.S. counterterrorism sources, that flights from Continental Airlines, American Airlines and United Airlines were targeted.

Britain's national security threat level was raised to "critical" from "severe." The U.S. government raised its threat level for commercial flights to Britain to its highest level and the U.S. Department of Homeland Security warned that "we cannot be sure that the threat has been entirely eliminated."

J.P. Morgan analyst John Bridges said gold was 'misbehaving' because investors appear to have decided that the terror threat "has apparently been defused, the gold insurance can be foregone for a while, and they can refocus on summer holidays... We believe this highlights the complacency and short-term nature of much investment."

Kevin Kerr, editor of Global Resources Trader, a newsletter published by MarketWatch, said gold's move was puzzling as it should have benefit from its traditional safe-haven role.

"The news is coming in so fast and furious that traders are almost in shock and are getting their bearings and deciding what to do next," he said.

Kerr said he expects the metal to rally once the gravity of the situation has set in and investors turn to the metal as a safe-haven instrument.

"We see $700 gold as a major possibility should these events escalate," Kerr said.

^---(from url)---^

Follow the newswire and join the NewsGroup to stay abreast of breaking developments.

You all understand why gold isn't allowed to react upward on the day of scary news, don't you?

It's because people have very short attention spans. The gold market, with its price still in the controlling hands of vested interests, is too delicately balanced to allow for the extra demand that would come upon the heels of any price performance that provides immediate positive reinforcement of investor sentiment.

Thus, if most people can be shown a gold price that doesn't respond -- or even NEGATIVELY responds -- on the day of an attention-grabbing event, most of them will thereby be kept on the sidelines.

The price will surely rise a short time later, but by then it will be off their personal radar screens.

Frankly, the one thing being manipulated moreso than the price of gold is investor sentiment.

Amen.

R.

http://www.gata.org/node/4279Barrick is the big physical short in the
gold business -- fronting, as Barrick has
admitted, for the central banks. Anything
that allows Barrick to obtain gold cheaply
-- like acquiring NovaGold at a bargain
price -- facilitates Barrick's short
position and helps suppress the gold
price generally.

Short covering by gold producers is
acknowledged to have boosted the gold price
substantially in recent years. So what if
Barrick had to cover its short position of
about 12 million ounces by going into the
physical market instead of buying gold in
the ground at a great discount? The gold
price would rise sharply, or else central
banks would have to dishoard a lot more
of their gold reserves, which they are
proving reluctant to do.

The central bank scheme here all along
probably has been 1) to drive gold down
so far that their currencies and bonds
would be strengthened and only the
biggest mining companies could survive
by hedging gold borrowed from the central
banks, 2) to push smaller mining companies
and exploration companies into bankruptcy
or induce them to sell their assets at
distress prices to the majors, and 3) then,
when central bank gold reserves are nearly
exhausted and the heavily hedged big miners
-- conscious or unconscious agents of the
central banks -- have acquired the best
mining properties, let the gold price rise,
so that 4) most of the mineable gold has
been put in the hands of the central banks'
agents, from which it can be returned to
the central banks as the hedges of the big
producers are covered.

That is, the central banks run the gold
price down to strengthen their currencies
and bonds and then call the gold back on the
way up, retrieving their wealth and power
in golden form as their currencies and bonds
weaken, insuring themselves against the
monetary debasement and inflation they
caused.

If you disagree with this speculation, try
to attend the next meeting of the board of
the Bank for Intenational Settlements in
Basel, Switzerland. If you manage to get
inside, ask the head of the BIS Monetary
and Economic Department, William White,
about the speech he gave at a BIS conference
in Basel in June 2005, "Past and Future of
Central Bank Cooperation," which is available
at the link above. White's speech is a frank
admission that central banks rig the gold
market. And the gold Barrick hedged,
suppressing the gold price, came from central
banks through J.P. Morgan Chase, itself
essentially an agent of the Federal Reserve
and Treasury Department.

Then, of you still don't care about Barrick,
I will apologize. This is the best I could do.

US president George Bush has said the alleged plot to blow up transatlantic flights is a "stark reminder" the US is "at war with Islamic fascists".

I seriously doubt it. He calls Usama and Islamic terrorists "Islamic Facists" and yet hold hands with the King of Saudi and kisses him on the cheek. LMAO

- Black Blade

A side note, some floor chatter is that Morgan Stanley among a few other investment houses and banks went heavy into long positions on precious metals and petroleum thereby dropping these defensive stocks like lead balloons on news that normally would kick off strong rallies. Note that ConocoPhillips (NYSE:COP) on Thursday declared "force majeure" on Alaska oil shipments, while BP just announced on CNBC that they shutting down the entire Prudhoe Field after an initial inspection. Got that! "initial inspection"!!! Then XOM and Shell are rumored to announce that they too will declare "force majeure" on all west coast markets.

Northern California refineries are scared and are certain to face lawsuits from state government and "citizen groups" (aka "ambulance chasing lawyers") as they can only process intermediate grade oil (similar to what they did to the NatGas companies in 2003). The only other sources of intermediate or better oil are in Africa and North Sea. That means fleets of small Panamax tankers will be running wild to scrounge any and all intermediate and light sweet crude oil. The Panama Canal is backlogged 3-4 days on both ends. This is gonna be a whole lotta fun. the smart investor will take advantage and of course physical gold went on sale this morning thanks to some "interesting" morons in high-rise Wall Street offices. Might as well take advantage and grab some while on sale.

"A side note, some floor chatter is that Morgan Stanley among a few other investment houses and banks went heavy into long positions..."

Meant to say "short positions"

- Black Blade

The oil is not worth it. Try something else. This consuming, resource destroying society has come to it's end-times. Someone will have to come up with some other means to keep an economy of billions going besides sucking every last drop of oil out of the ground.
Tulips drove a market once. It seems stupid now, but it illustrates that an economy and a market can exist around practically nothing at all.
Perhaps the information revolution will provide the conversion from rabid consumption to miserly conservation. Factories and work forces need only exist in cyberspace selling non existent goods and services to internet consumers who use their digital material only to advance themselves in the pecking order of their social circle. Much like today. Except for one thing. There will only be a transfer of data. No one leaves their home. Their is no destruction of precious resources and the end result is the same, prestege and recognition.
This will be the new paradigm.
What happens to gold it this kinda scenario?

I seriously doubt it. He calls Usama and Islamic terrorists "Islamic Facists" and yet hold hands with the King of Saudi and kisses him on the cheek. LMAO

Laugh fool. Saudi Arabia is a puppet government, that is why they have a King. Not your western style democracy being promoted in the mid east. If the USA gets into real trouble the Saudi government wouldn't last week.
Your vision is much to near time centered. You need to look a bit further out.

"The oil is not worth it. Try something else. This consuming, resource destroying society has come to it's end-times. Someone will have to come up with some other means..."

Be my guest. Do that and you can buy both Bill Gates and Warren Buffet. It would be the equivalent of finding the "Holy Grail". ;)

We started out having slaves and animals doing the work. Then water wheels, later steam engines and whale oil. later Petroleum Liquids and Energy Minerals. Find the "magic bullet" and you would have more money than God! ;)

- Black Blade

I don't mean an "other means" of energy. I mean another means to keep everyone occupied that wouldn't consume all the resources left in the ground.

Druid: Great Wizard, my pleasure. Please post any response. Thanks.

I am quite happy to set oil and NatGas wells. In fact set a shallow NatGas well today, a shallow vertical oil well on Monday (maybe 300+ bbls minimum from earliest indications), and another CBM NatGas well last week.

It is the work that made me the man I am today - as my Colombian and Indonesian girlfriends say - "financially stable". ;)

- Black Blade

It is hard for me to believe what is happening in natural resource and utility companies these days. I can still remember when geologists and geophysicists and engineers were at the helm. The trend shifted sometimes to sales people and even an attorney or two in some decades, but now unfortunately, it has shifted to financiers.

Not only have the financial corporations sucked the life out of the industrial corporations, they have placed their gnomes in charge of companies which require an understanding of something other than present value calculations and cost cutting and staff reductions.

I recall predictions a quarter century ago that these boys would not be able to keep the lights on or the oil flowing. Those predictions have proved to be right on target. As General Douglas MacArthur said "If it is right at the top it will be right at the bottom"�now it is neither.

Greetings,

I think our current energy crisis is actually pre-fabricated. There is no shortage of oil or electricity or natural gas. I think all of this supply and demand tug of war is in part due to distribution and production. I know from what I read there is plenty. Plenty for a 100 years or more.

The Saudis do not tell anyone how much they have. Just prior to 2000 we had flows of oil at low costs. Now with all the turbulence it has investors jittery and this alone is one factor to hike up the cost.

I have also noticed that when companies need a reason to raise the price they can find it. The war and terrorist activities all became just so convenient. I am not worried about running out of the black gold, what I am worried is our dependence on it. I am also worried about all the red tape that black blade mentioned on how every one wants to sue a company for some environmental issues.

France, has more Nuclear power facilities than I have underwear. I think the USA has become very lazy on the front line of energy research and even development. We want our cake and want to bake it in the oven too??

I do feel that if we could cut back our oil consumption mixed with alternative fuels and other energy products with more fuel efficient cars and appliances and a better attitude about energy use we would see the demand slow and the worries go and oil would drop.

So we do not slip into our OIL ADDICTIONS we could impose a tax. A three letter word? A good way to take the funds and build other energy options. So what's wrong with these ideas? You would think by now someone might put this into action!!

GOLD on the other hand is far undervalued. How can you but a value on something that is consumed but not used up. It's extremely durable and has always been a symbol of wealth.

When I die, I am going to have all mine melted down and then I want my casket to be dipped into it. My dead body surrounded by gold. WOW, how elegantly morbid.

Cheers to a better tomorrow!

http://p100.ezboard.com/fpeakoilpetroleumandpreciousmetalsfrm10.showMessage?topicID=7148.topicBP readies oil tanker spree after Alaska outage

Snippit:

LONDON (Reuters) - BP is scrambling to move oil from across the world to make up for lost production at its Prodhoe Bay oilfield in Alaska, shipping industry sources and brokers said on Wednesday. On Tuesday half of the field's output, some 200,000 barrels per day, was shut-in. London Brent crude oil prices hit a record on Tuesday on news of the outage. BP's enquiries for fixtures ranged from Very Large Crude Carriers (VLCC) to suezmaxes and smaller panamax ships, from as diverse places as the Middle East Gulf, West Africa, the Mediterranean and the Caribbean.


Black Blade: There is simply not enough intermediate grade or light sweet crude to make up the loss of 200,000+ bbl/day of Prudhoe Bay oil (likely to be much more). Nearly 346 million bbls travel from Valdez, Alaska every year (Nearly 950,000 bbl/day) - that's 17% of domestic US oil production. Many here know I have already discussed the lack of refining capacity over the years.

Don't be surprised to see producers and refiners to hire Tanker fleets of both "dirty" and "cleans" to avoid "force majuere" as what happened to ConocoPhillips (COP) yesterday. Other companies in trouble for meeting delivery of intermediate or better quality crude are Exxon-Mobil, Shell, and to a small degree Chevron (among others). Meanwhile the northern refiners in Benica and Pittsburg (SF Bay area) were never upgraded to handle lower crude grades due to the enviromentalists in the state that opposed the expansion and upgrade of local refineries.

$4-$5/gallon unleaded by September or sooner would not surprise me at all. But what the heck - that's my job. In life there are winners and there are losers. I have been quite fortunate and much has been to to the scarcity and rising cost of energy. Today I saw unleaded zoom up to $2.73/gallon for unleaded. "Interesting Times"! Hang on tight to your Gold and Silver. This story will get even more "interesting" and has a long way to go. KA CHING!!!

- Black Blade

@BB,

Perhaps this ios too simplistic, but why are the tankers that leave Alaska with the oil at the end of the pipeline not available to use for "replacement"?

It would seem to me that if their goal is replacement of output that the tankers originally destined for the lost output would be the ones used for rerouting.

Are tankers, like refineries, only able to ship one variety of oil?

You are welcome.

Please keep us informed on the Barrick/Novagold news.

http://www.urbansurvival.com/week.htmsnip:

The Bureau of Economic Analysis says the Balance of Trade in June was just about the same as May.
The U.S. Census Bureau and the U.S. Bureau of Economic Analysis, through the Department of Commerce, announced today that total June exports of $120.7 billion and imports of $185.5 billion resulted in a goods and services deficit of $64.8 billion, $0.2 billion less than the $65.0 billion in May, revised. June exports were $2.4 billion more than May exports of $118.4 billion. June imports were $2.2 billion more than May imports of $183.4 billion.

In June, the goods deficit decreased $0.7 billion from May to $70.4 billion, and the services surplus decreased $0.5 billion to $5.6 billion. Exports of goods increased $2.5 billion to $86.6 billion, and imports of goods increased $1.9 billion to $156.9 billion. Exports of services decreased $0.2 billion to $34.2 billion, and imports of services increased $0.3 billion to $28.6 billion.

In June, the goods and services deficit was up $6.4 billion from June 2005. Exports were up $14.8 billion, or 14.0 percent, and imports were up $21.2 billion, or 12.9 percent.


Unfortunately, what I look at is not the month-month numbers./ instead, I prefer the daily run rate. The $65 billion in May was in a 31-day month. That's $2.09 billion per day. June, at $64.8 billion in 30-days was running a higher daily burn rate of $2.16 billion per day.

But hey! Don't listen to me on this...just look at the burn rate and the coincidences around... Consider what happens this fall when Alaska oil comes off in the reports that will reflect the pipeline closure...

-Goldilox

Lost in the hype of the TSA announcements is the Balance of Trade release. George Ure had this to say about that! Thanks to our Roman calendar, it's even possible to hide increases behind unevenly divided months.

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

"Treasure chests throughout history
have been filled with gold, and not by idle choice."

-- R. Strauss

http://www.mosnews.com/news/2006/08/09/peretzslamsrussia.shtml
"Hezbollah's troops are using modern and sophisticated Russian-made anti-tank missiles against Israel's army in fights in the South of Lebanon, Israel's defense minister Amir Peretz said Wednesday, RIA Novosti news agency reports.

"We are fighting against the Iranian commando, which is armed with sophisticated, modern weaponry. This includes Russian-made anti-tank missiles, which in the past it was promised would not fall into the hands of Hezbollah. This weapon is used today against IDF soldiers in Lebanon," Peretz said during the meeting with the German Foreign Minister, Dr. Frank-Walter Steinmeier, ynetnews.com reports."
....
http://en.rian.ru/russia/20060810/52496375.html
Russia denies sending anti-tank weapons to Hizbollah - ministry

As I sit here, composing my first message for this fine discussion forum, I am actually saddened at the embarassment of riches in topics to choose from. Debt, inflation, peak oil, global warming, you name it.

Age does bring a measure of historical perspective that cannot fully be achieved by the young merely studying history. History is best lived to be absorbed. What a shame that the more experience you get, the less time you have to put it to use.

I took my first bath in the silver market almost 30 years ago as a wide-eyed youngster with a bit of inheritance who wondered why everyone didn't make their living trading commodities as it was obviously "easy money". Shortly thereafter I learned how the word "leverage" related to the words "margin call" in the real world. I was not wiped out, but "wow". As Bing Crosby said in "Holiday Inn" that's somewhere between "ouch" and "boinnnggg".

I have watched the world go by for those 30 years since and I have studied chaotic systems along the way. Obviously our little island of relative "peace and prosperity" in history cannot and will not endure. Neither will our fiat system(s) since, as we all know, none ever has.

But I am dismayed that some here seem to eagerly anticipate the collapse and are disappointed that it has not already come. They are ready, so they think, so "bring it on"!

The whole world stands to lose everything if the dollar collapses. Even if you are a billionaire and have built a stocked and fortified bunker on your private island, your life will never be the same and will be WORSE if the dollar suddenly collapses. Just-in-time manufacturing will fail, all manner of deliveries will stop, 99% unemployment will result in chaos, famine, and anarchy.

But you are safe on your hobby farm with solar power and gold? Think again. You simply lack scope of imagination to understand what will come. In "When Money Dies" Fergusson describes angry, desperate mobs from the city attacking cattle in the field and ripping them limb from limb. If we become angry enough to kill because of road rage, what will happen when our children are starving and our society believes it is their "right" to have food and shelter? They will take it by force until nothing remains and kill you along the way for "hoarding". Stop worrying about dieting, in that scenario the overweight will inherit the earth.

Fortunately there really does seem to be a group of elites attempting to control the world through its financial system. That was a very very bad idea in the beginning of course, but now we are at the end of that road and there is no turning back. That they stand to lose everything if there is a monetary collapse is a happy coincidence for the rest of us.

I believe that is why collapse does not come, despite our governments best efforts to bring it. The CONTROL regimen has been successful so far, and I HOPE IT CONTINUES TO BE! If that means manipulating the price of gold as long as possible, FINE WITH ME! Don't underestimate them. When literally billions of people have a stake in the status quo, it can apparently be nursed along longer than anyone would have believed possible. This is not a consipiracy at the macro level, just very powerful common interests.

If you look back through these and other archives, you will read the same "imminent collapse" call for at least the last 10 or 20 years. I recently watched a recording of Ronald Reagan's speech to the U.S. Congress in 1982(?) in which he decried the absolutely unaccpetable and unsustainable national debt of "one trillion dollars". Well obviously we did sustain it, and now its 8 times higher. EIGHT times! Debt, inflation, etc. it's old news. Gold has gone up, and the smart people made money, but we are all still here.

Of course all chaotic systems reach their tipping point and move to a new configuration eventually. I have all the position I can afford (fully paid) in paper and physical gold (purchased from our hosts), but like Richard Russell I hope my heirs will still hold it when I am long gone. It is great insurance, but I fervently hope never to collect on it! So prepare and be ready, but don't live your life holding your breath, waiting for the collapse. There are probably still communes in Idaho you can join that have been waiting since the 70's. I don't want to live in a commune so I guess I'll just keep on as I have been. 2 months or 20 years, nobody knows but I'll hope for the latter.

Nathan Brazil (8/11/06; 12:07:15MT - usagold.com msg#: 146566)
Timelines
---
Thanks Sir NB !
Now let us hear from you MORE OFTEN !
<;-)

As misery loves company so does a good conspiracy theory and/or theorist...

A refreshing post from Nathan Brazil...

Yikes.....

The FED finally stops it rate hike barage, but even so didn't give any assurance they were done and this kept the stock markets on edge. Gold would have surged and the dollar would have tanked if the FED would have said, "We are done for the forseeable future - inflation is under control". Anyway they got the best of both sides this week and when the recession starts in the labor markets (housing/autos) they can claim they didn't over tighten.

US citizens found out that the Alaskan pipelines are 80% corroded and it will take months to get replacements. It's not like you go down to Home Depot and say, "Hey, do you have any oil pipeline in stock?". "Yeah, sure I've got 16 miles out back". No sir, this stuff is custom ordered and built by US steel. I don't think the impact has sunk in yet, but Congress is already planning an investigation. Maybe they'll take a tour of the shuttered refineries in California that make that custom gas mixes especially designed for Alaskan crude. I hear its the "good" stuff and when they refine it becomes crack.

And another terrorist plot was uncovered. Man our guys are on the ball. Apparently the terrorists discovered some technique for mixing bottled water, Grecian Formula, and lipstick to make a toxic bomb that can explode in an airplane. What is it with these terrorists anyway, what do they have against planes? I guess they figure if they blow up a few up, the planes will get paranoid and stop flying into their countries.

Found this in the hall of fame and thought that it might be worth a second read. Sure, the world is built around the US$ as the reserve, but its pretty clear that the world, over the last few months (years), has started gathering a golden reserve. It is interesting to think about how gold can be used to protect a local currency and how a local currency can be used to buy gold on the open market. The most interesting part about this concept is that it is gold friendly rather then gold suppressing.

Enjoy.

[Editor's Note: Please read what's below carefully. This is an extraordinary analysis from the Friend of ANOTHER at a time of much confusion and uncertaintly in investment/currency markets. We are told at the outset that the largest pro-gold groups -- the Europeans and the Gulf states -- want a world currency "not subject to the performance of the American economy." In other words, a currency not tied to American treasury obligations, or the percpicacity of any other nation for that matter. That currency for those of us who have reached for the deeper truths of economy is called gold. As an American, I must say that I have never seen the concept of American hegemony explained in quite the same way before. Perhaps, my eyes were closed. I keep getting this feeling that Americans must necessarily begin to understand a new role for this country in a rapidly changing international political and economic environment -- a role for which our political and economic institutions appear ill-prepared. I will not be so presumptuous as to explain what the Friend of ANOTHER is saying, I will let you read for yourself. I do not think it could be said any better than Friend of ANOTHER says it. The fact that his analysis implies how one should design one's portfolio is a happy side benefit.]

8/10/98 Friend of ANOTHER
Michael Kosares,
It has taken some time to send this, but now I can also offer my thoughts to your questions.
Your statement: "As a matter of long term policy, do you believe that ECB will "sell" gold to defend the Euro or "buy" gold to defend the Euro? Each of course would entail a different course of action with respect to reserves of the new national bank. Along these lines,will ECB buy gold from its member treasuries, or will it simply force them to transfer it to ECB coffers if needed to defend the Euro? I am prompted to ask this question in view of your assertion that there will be much selling of Euros to defend the dollar. If the Euro, as you suggested, is being printed to buy dollars isn't this just another manifestation of the U.S. exporting its inflation? It appears to me that the Euro will need to be defended -- and not with dollars -- but with gold! "
Michael, I believe the most difficult part in understanding the modern gold market is overcome by seeing all the various political factions involved. Essentially and basically, the largest pro gold groups are those who want a world currency that is not subject to the performance of the American economy. At this moment and in this period of economic history, all currency reserves held by foreigners (non-Americans) is a debt of the US Government and by extenuation through tax collection, a debt based on the ability of the American economy to function profitability!
In essence, America has told the world that as long as the business of this country is functioning, your wealth, as represented in Marks, Yen, Pesos, etc. is backed with performing US debt. It's like saying, "as long as your neighbor, next door, does not loses his job, you will not lose all your money! Most people would be surprised at how clear this is, outside the USA sphere of influence. This, the largest of the pro gold group, is largely made up of countries with economies that have no need to sell most of their production to the US. The business of these communities would not totally fail without the American engine. Yes, they would slow down, but not collapse, as trade with other countries would continue. To add what was said before: If your neighbor loses his job, you can still trade with the other people in the town, as long as the currency system is not based on your neighbors debts!
This group, made up of much of Europe and the Middle East, is not looking for a return to the old Gold Standard, but perhaps something far better. They do not see any advantage in holding the currency bonds of one country, as a reserve asset of future payment, over holding physical gold as a reserve asset in full payment. The fact that the debt reserve asset pays interest is little more than a joke in these banking circles. Any paper currency, the dollar included, can fall in exchange value against your local currency far more than the interest received! In today's paper markets, the only true value in exchange reserves, held by a government as currency backing, is found in it's effectiveness for defending the local currency from falling against other currencies. In other words, use the reserves to buy your countries money. But, this is a self defeating action as sooner or later the reserves are used up! This fact is not lost on many, many countries around the world, as they watch their currencies plunge, lacking reserves as defense. Ask them how important the factor of earning interest on reserves is under these conditions.
On the other hand, buying gold on the open market, using your local currency, works as a far different dynamic from selling foreign bond\reserves. This action takes physical gold off the market, and in doing so increases it's value in dollar terms. Gold is and always has been the chief competitor with the dollar for exchange reserve status. The advantage here comes from the fact that governments do not run out of local currencies to use in buying gold, as opposed to selling foreign currency reserves to buy the local currency on the open market. Of course, the local price of gold goes sky high, however, in this action you are seen as taking in reserves, not selling them off.
Also, as gold begins to rise against the dollar, the local gold reserves are seen as assets of increasing value, backing the local currency. Under these conditions, with a stable currency, citizens will purchase more gold as it is seen as a positive asset. Not unlike a rising stock, everyone wants an increasing investment. Contrast this action against that in Korea, where everyone sold gold as it increased in an unstable currency!
Basically, this is the direction the Euro group is taking us. This concept was born with little regard for the economic health of Europe. In the future, any countries money or economy can totally fail and the world currency operation will continue. What is being built is a new currency system, built on a world market price for gold. Michael, you are absolutely correct in that the USA will see a hyper inflation of it's currency and a gold price in dollars that reflects it. Unfortunately, for most investors, the gold price rise will be sudden and also hyper fast. as it will occur just after a rapid plunge in dollar based assets including, stocks, debt and the entire banking system. This action will destroy virtually all gold based paper assets as they are also dependent on a functioning economic system. A local gold mine, in any country, must sell production to realize a profit. The contract system they deal with will not be functioning during this time. Contrary to many hopeful investor, local treasury officials will not allow miners to pay employees or buy equipment with physical gold. When the dust does clear for mining to continue, gold will be recognized worldwide as real money, and the mining of money will, no doubt, carry Extreme taxation. Stock prices of these operations, after being priced to zero, will then double or triple in price. Zero times three equals?
Back to your original question. The Euro will not replace gold, it will evolve into a gold transactional currency. It will also price Euro gold very high, perhaps $6,000 in current dollar terms buying power. However, in actual dollar terms of the future, $30,000 US will reflect the American debt as the negative reserve asset it truly is. The ECB will have an easy time issuing Euros to buy gold from the member banks. The real political warfare will be in trying to force them to sell the gold at all, once this ball starts rolling. The Euro has, in effect already been dispersed in the form of Gold Leases not gold sales. One has only to look at the official gold holdings of most central banks to see that physical gold sales are little more than the average, with a good amount of that coming from nonEuro countries. Gold is a funny thing, it can be sold many times and pass through many countries and still remain in a CB vault. Truth Be told, some 14,000 metric/ton have been sold this way. Far more than the street thinks. Using this amount it's easy to see how certain entities have moved off the dollar standard in the last few years. If we use a future price of $6,000+US, the move is about complete.
The process: An oil country (or others) goes to London and purchases one tonn of gold from a Bullion Bank. The BB borrowed this gold from the CB (leased). The one tonn gold certificate is transferred to the new owner. The gold stays in the CB vault and the owner goes home. The CB leased this gold to the BB and expects it to be returned plus interest. The BB financed the Actual Purchase of this gold mortgaging assets of the buyer. The BB, who created the loan, then uses the cash arranged in this venture to contract with a mining company (or anyone wanting a gold/cross financing deal) to purchase production gold, using this cash to pay for it. In the eyes of the mining company, the BB just sold gold on the open market, for cash, and will purchase future production at the contracted price. The mine does not know where the gold came from, only that it was sold and a fixed cash price is waiting. Of course, most of this made more sense when gold was higher. There were thousands of these deals, structured in every possible fashion. Look to the volume on LBMA and you see where the future reserve currency is traded today!
Now when we look at this picture, who is at risk here? The Euro CB Group still holds the physical gold and will buy it back from the new owners, if asked, using printed Euros. The new gold owner has just replaced his dollar reserves with either bargain priced gold, or Euros at an exchange rate never to be seen again! Some of this was done to buy the pricing of oil in Euros. The BB owe the CBs 14,000 tons of gold that they must collect inthe future from producers or currency speculators. And they must collect it by paying what will be a, then, ridiculous price of $300/$400US, while the world market price will be, well, a little higher.
With Canada, Australia, and perhaps England having sold much gold to hold US$, much of the English speaking, IMF/dollar world is about to change. Any country, Japan, Mexico, etc., that has locked their future by selling most of their production to the American economy , is headed for a depression. Another is answering some of your mail questions and is also sending a letter. Will send it on arrival.
Thanks Michael,
FOA

http://www.financialsense.com/fsu/editorials/2006/0810.htmlsuilad sir Nathan Barzel! Excellent thoughts.

And yes, I find it hard to belive myself that they would risk it all without a plan for their own wellbeing. Monetary collaps, oil collapse, it all comes out in the wash. Control was always Plan A. And it is still plan A. And I am still interested in what the plan has in store for an oil collapse.

Sir Fed Reserves, the oil market hasn't discounted that pipeline yet... not at least according to california gasoline prices.

Today's action is insane. Another week of negative gas injection! Fortunately last winter left us well stocked.

http://tonto.eia.doe.gov/oog/info/ngs/ngs.html

I do not want to comment on the Middle east situtation here, but clearly as the war on producers (US, middle eastern, Russian or wherever they are) hasn't born sufficient fruit, then perhaps a war on consumers is next, perhaps not US consumers, but someone will have to do with less... blood does not come from stones, but oil only comes if you can squeeze hard enough. And Gawahr is about tapped- it needs rest. (see chart)

Gandalf the White, kind Sir, you posted information yesterday that caught my attention (msg#: 146546).

Snip:
RE: Department of the Treasury
Financial Management Service
STATUS REPORT OF U.S. TREASURY-OWNED GOLD
June 30, 2006
--
Total - Federal Reserve Bank-Held Gold 13,452,783.620 Troy Oz.
--
Please advise me WHY this gold is being held by the Fed Reserve ?
:End

To you posting, I would like to add a �thought� from �98 with regards to this. What this really means, I do not know. I'm sure one of you old timers will have a comment or two about it. I look forward to learning more about this!
5/3/98 ANOTHER (THOUGHTS!)
Mr. Kosares, Your friend thinks much of this gold owned by the USA. It could be used to back the dollar up to 25%, no? Many come to this thinking and hold a secure thought, that as last resort, this gold will save the day! I think, many persons never gained the understanding that the American gold is kept by the "Treasury", not the maker of your money, "The Federal Reserve". It is there for good reason, as the present world currency system is not a function of American law! If the US were to place gold in the hands of the US/CB as reserves for the dollar, the BIS could claim it! It is, as a point of contention and of no real use. I think not a war would come of this claim, if it should happen! As the world currencies are now, a "new dollar" would be needed if gold were used as reserves! The present dollar would then, truly be as "paper for the wall"!
The urgent drive to create a new "reserve currency" began in the early 80s, after the last small "gold war". The road to making this new Euro did never include gold in large amounts, until the last few years! Even one year ago, the news would say, 5% or less. Today, we speak of a much greater amount! This is interesting, yes? The BIS did "hatch" this deal in a very late fashion! The future of the Euro was found to be "weak", as the Middle East oil imports onto the continent would continue in dollars! This was so from the dollar being made strong in gold. Gold priced in dollars at near production cost, offered a "no switch currency" position, for oil. This position has been unstable for the last year, and the alternative of a switch to gold was in progress! You have read my "Thoughts" before. Now the BIS does offer to "change the rules of engagement", a real reserve currency is offered!
Few do grasp what is happening and why! They think the holding of gold reserves by the Euro is of a little point, as to what good are gold reserves? One cannot use gold as Marks or Yen to intervene in currency market to support the Euro. My friend, the BIS has played the, as you say, "big poker hand"! The holding of large reserves by the ECB and the withholding of sales from the market will not only bring the end of the London paper gold market, it will, thru a high USD gold price, "make the dollar weak in gold"! From this position, the dollar will lose the "oil backing" from the Middle East! At first, all oil for Europe will be in Euro's, then all producers want "strong currency"!
There is more: Many say, how to defend Euro without much currency reserves? If gold go to many thousands US, what will be used to bid for Euro as defense? I say, these persons will find a problem on their computer screens! You see, the Euro will start as "nothing", no holdings of size, anywhere! The dollar is held as reserves as "the stars in heaven"! It is to say, "the dollar will bid for the Euro", not "the Euro will bid for the dollar"! All currencies will "flow into the Euro for trade". But, if the Euro becomes so strong, how to compete in world trade? It will be the price of oil that will make the "trading field" level! The soaring US$ price of gold will make even a 10% Euro reserve be as 100% today, in USD! Oil will become, very, very cheap in Euros and allow that economy to do well! Many other countries will see this and also want to join the new "world reserve currency" that has become"the new world oil currency"!
The politics of the ECB? It is as a "side show"? We watch this new market, yes? Sir, my words take time. I did receive two E-mail's from you.
Thank you

I would think that if a tanker can make the Alaska-LosAngeles trip in 2 weeks then it might take a few more weeks to make the Venezuela-Los-Angeles trip, or wherever they are going.

They need more tankers, or bigger tankers, or something to keep the rate (barrels per week) of delivery the same, or so I would guess.

Welcome.

To many, it seems the sky is always falling when it comes to the US$. But it just may not be as drastic as one might believe. More currency exists then there are leaves on trees and its all found function in the world economy to the surprise of gold bugs everywhere (self included). One day, what people count as wealth, some mutual fund or stock account, will find that it will have a negative flow of capital and it will not maintain its value as it has over the last 20+ years. That is, all those people that used paper markets to save (for retirement) will start drawing on their savings expecting it to provide what they think of as being wealth for the spending. What I find interesting is that when someone looks at their account today, that is fat with zeros, they have no idea that in 5 to 10 years when they are drawing on their savings - everyone else in the world will be doing the same thing. At that point, there will be a great awakening with regards to the real value of those accounts. Also, as those that are working today wake up to realize that every dollar they invest will not tip the markets into surplus (that would drive up prices) they will not use paper plays for retirement investments.

Now, what about a panic by the older public with regards to getting their money out of these long term investments before all value is lost? We all know that if the herd moves one way too quickly, the entire play falls apart. Everyone knows this, and my bet is that it will not be allowed. That's right, we'll probably find new laws placed on the books before too long that will prevent people from taking their money out of their accounts to fast. I would call them unfavorable taxes. This, may make it so that people will hold those dollars longer thus extending the bubble called paper investments (or perceived wealth) just a little longer.

Everyone around the world needs to have a currency to use in the economy. The US$ is so ingrained that it may take a long time for replacements to build confidence from the people and find their way towards replacing it. The signs are many that gold has started to fill that roll (indirectly) but only to the Central Banks of the world (and gold bugs). We all watch as this new roll for gold slowly unfolds on the world markets. There is no need for panic selling of the US$ or panic buying of the Euro (or any other currency) � they all function quite well for just about anything except saving.

Following in the footsteps of giants is quite often a wise thing to do. Seeing that gold is being used as the backbone for this gradual transition, those that wish to save, may find that gold is a fine and SAFE way to save into the future.

http://www.energy.ca.gov/reports/2002-03-14_600-02-007CR.PDFGoldilox, Please let me try to answer the question you posed to BB regarding tanker reassignment from Valez, ALaska to US West Coast service to other loading sites.

The round trip for a tanker from Valdez to US West Coast destinations is about 12 to 15 days. The same round trip from the Gulf Coast is about 41-45 days.

snip;
"Voyage Time from the US Gulf Coast to California
Let us consider the logistics of a voyage from the USGC to California via the Panama Canal. To move
product from the USGC to California on a tanker, an operator must: accumulate the cargo, load the vessel,
sail to Panama, wait for a slot in the canal, traverse the canal, sail to either Los Angeles or San Francisco
and unload the cargo. After the cargo is accumulated, a typical trip to Los Angeles takes 20.5 days while a
trip to San Francisco requires 22.5 days. Because the vessel must return to the USGC for the next cargo,
the typical round-trip time requires a total of 41 to 45 days. A more detailed breakdown of a typical trip is
shown in Table 2."

Voyage times (round trip) from the Mid East would be somewhat longer, perhaps 50-55 days. Hence the same volume of oil supplied by tanker to the West Coast will reqire 3 or 4 times the tanker capacity and roughly the same cost multiplier for the longer trip.

Anyone notice a new poster with a bent to first state how he (presumably) is 100% pro gold and then closes with his posting with a sentence or two that would make gold advocates implicitly seem like "crazies?" I won't name names but I believe one may have recently started lurking and "contributing" here recenlty. Think psyops to disuade the masses who may be viewing this site for the first time.

I may be wrong, I often am.

Have a great weekend!
PA

"Fortunately there really does seem to be a group of elites attempting to control the world through its financial system. That was a very very bad idea in the beginning of course, but now we are at the end of that road and there is no turning back."

There are alternatives.

"Insanity: doing the same thing over and over again and expecting different results".
Albert Einstein,

http://www.iranmania.com/News/ArticleView/Default.asp?NewsCode=44979&NewsKind=CurrentAffairsThe Invisible Hand (8/10/06; 06:44:31MT - usagold.com msg#: 146533)
A Crude Awakening for Women (and Men)
http://usa.mediamonitors.net/content/view/full/34026
Reparations for Iran
by ROSEMARIE Jackowski
(Thursday August 10 2006)
"One has to ask the question, how many civilians have been killed by Iran with nuclear bombs?"
SNIPS
On August 19, 1953 the government of the United States executed a coup d'etat in Iran
+
The United States owes reparations to the people of Iran. How much should be paid for the 1953 coup? How much is a democracy worth? Here's a thought. Suppose the U.S. gave all of its nuclear weapons to Iran. Would that be a win, win, win scenario? The world would be safer because the only nation that had ever used nukes would no longer have any. The people of Iran would be compensated for the 1953 coup. The U.S. taxpayers would be spared a bill for reparations.


http://www.iranmania.com/News/ArticleView/Default.asp?NewsCode=44979&NewsKind=CurrentAffairs
Saturday, August 12, 2006
According to IRNA, the 60-year old professor [Jean-Pierre LEHMANN] said the Bush administration sermonises about freedom and democracy to Iran, but it "should it not, at the very least, acknowledge that democracy in Iran was aborted by the UK and the US in 1953 with the overthrow of Mohammad Mossadegh." "The US-UK then imposed and strongly supported the dictatorial monarchical rule of Mohammad Reza Pahlavi as shah of Iran until he was finally overthrown by the Iranian people in 1979," he said.


Who's Professor Jean-Pierre LEHMANN?

http://www.iht.com/articles/2006/07/25/business/web.0725tradefront.php
World trade talks fail over impasse on farm tariffs
July 25, 2006
SNIP
"I think this would seem to lead to the collapse of the multilateral trading system," said Jean-Pierre LEHMANN, founder of the free-trade Evian Group based in Switzerland.

The answer is, Uncle Sam is.
How are they gonna do it? Inflation or sell the gold in Fort Knox? I think inflation will be the route to take. After all it is what got us here to begin with. After 50 years of success why make a change in policy?
This is a long way from over. We have entered another relaxation of monetary policy period. The interest rate screws weren't tightened enough this time. Inflation will rear it's ugly head again.
In the 80's under similar conditions gold exploded to $850/0z. My mortgage came due for renewal at 19.5%. My mortgage was small, although the monthly payments nearly doubled, it was still a small bill to pay. Others weren't so lucky, housing prices halved in some cases. People just walked away from the house, leaving the keys at the bank.
The key here is 19.5% interest. It took that kinda interest rate to kill the last inflationary spiral. What will it take this time as we chase the last of the declining energy resources into the pits of zool. Maybe 25% or 30%. What will be the price of gold then?

http://www.kommersant.com/page.asp?id=695548This seems to say something important for our discussions.
But my English (or more precisely my (lack of) intelligence) cannot make it anything of this.

August 11, 2006

Economic Prognosis for August

SNIPS

The Russian ruble under the tsar could have rightfully been considered a freely convertible hard currency, but the ruble has never been a leading global currency � it is hard to imagine German or English firms dealing with each other in terms of Russian rubles, whatever the ruble's content of solid gold may have been. Thus, despite its trumpeting of the new status of convertibility for the ruble, Russia will continue to remain apart from the other countries of the G8, all of whom have currencies of leading global importance (with the possible exception of Canada, with its Canadian dollars).
+
The strengthening of the ruble can also be read as an ideological strike. In July the State Duma scheduled a second reading of a bill that would make it illegal for government deputies and the media to discuss prices in dollars. Though the tone of the bill was softened somewhat before the second reading (for example, it will be permissible to indicate the amounts of deals between foreign firms in terms of foreign currencies), its spirit remains unchanged: it still dictates to journalists the form of currency in which they should supply economic information to their readers. If journalists must be forcibly weaned off speaking in dollars, what does that say about everyday citizens? By systematically devaluing the American currency, the government is forcing people to abandon it � and to turn instead to government gold reserves.

Visits to the Castle ARCHIVES is very rewarding !
Like ANOTHER said, "We shall see together."
<;-)

I am not referring to Mr. Nathan Brazil.

Excellent post, sir Brazil (welcome and thanks for an excellent and insightful first post). I agree. We must be careful what we wish for.

PA

MPC = monetary policy committee
BoC = People's Bank of China

http://www.iht.com/articles/2006/08/11/business/ibrief.php
A CHINESE ECONOMIST, Fan Gang, who said at the 2005 World Economic Forum in Davos, Switzerland, that China should switch the yuan's dollar peg to a basket of currencies, will help set the Chinese central bank's monetary policy. Fan, director of the National Economic Research Institute, is the ONLY ACADEMIC on the 13-member monetary policy committee of the People's Bank of China.$@ (Bloomberg)

http://www.shanghaidaily.com/art/2006/08/12/288898/Academic_added_to_monetary_policy_committee.htm
ACADEMIC ADDED TO MONETARY POLICY COMMITTEE
SNIPS
FAN Gang, the economist who said at the 2005 World Economic Forum in Davos that China should switch the yuan's US dollar peg to a basket of currencies, has been picked to help set the Chinese central bank's monetary policy, Bloomberg News reported.
+
The committee meets quarterly to assess monetary policies and recommend changes. The State Council decides on policies including currency values and interest rate changes recommended by the central bank's monetary group.
+
"Fan is a supporter of market reforms, although his views are moderate, which may indicate a trend toward more advocacy of the free market" on the monetary policy committee, said Zhong.

http://www.easybourse.com/Website/dynamic/News.php?NewsID=40563⟨=fra&NewsRubrique=2
Fan, 52, is a professor at the Chinese Academy of Social Sciences, a government-backed think tank, and Peking University. He is also a director of the National Economic Research Institute.
At a CASS conference in July, Fan said China could allow the yuan to appreciate 3%-4% a year to help correct global imbalances. He said at the time the yuan shouldn't appreciate too much and favored a managed float rather than free float of the currency.

http://www.infowars.com/articles/economy/gates_buffett_china_run_from_dollar.htm
Gates, Buffett, China 'run from dollar'
WorldNetDaily | February 3, 2005

Druid: This is the Russian version of creating a demand for a state-sponsored currency by decree thus creating "value" where it might not ordinarily exist. The HUGE caveat here is in the ongoing composition reference the CB reserve portfolio and how it is valued.

http://www.usagold.com/DailyQuotes.html
The Daily Gold Market Report has beenupdated.

If you are considering investments in gold we invite you to request our freeintroductory information packet detailing the products and services offeredby USAGOLD ~ Centennial Precious Metals. We welcome your inquiry and lookforward to working with you.

FRIDAY Market Excerpts

Gold down slightly after choppy day of trade

August 11 (from Reuters) -- Gold fell on Friday in New York and closed at its lowest level since July 26, when a rally early in the session prompted speculators to swoop in and grab profits ahead of the weekend, traders said.

In London and for much of the New York session, spot gold had rebounded as buying interest resurfaced on price dips and traders saw a limited downside from an aircraft bomb plot foiled a day earlier.

COMEX December gold contracts finished $1.60 lower at $644.40. The range ran down to a low at $636.50 from a $655.70 high.

New York gold dealers said they were at a loss to explain the sudden sell-off. Some blamed technicals, others cited selling in base metals, and some just attributed it to crowd psychology on a slow summer Friday.

With volumes thin during the summer, traders said it was easy for short-term players to turn the market rapidly. "My best guess is crowd psychology. It seemed like there was a big flock of selling. There was pretty steady selling in precious metals for a couple of hours," a desk broker said.

But longer term players said they think sentiment remains bullish, with gold likely to move towards the upper end of recent ranges.

An expected rise in oil prices and a drop in the dollar in coming months should lift gold, Barclays Capital said.

"We expect the reaction in the oil market to have been somewhat overdone and we see the potential for oil to test new highs in the months ahead on a combination of strong demand, disappointing supplies and heightened geopolitical risks."

Michael Widmer, precious metals analyst at Macquarie Bank, said, "Going forward ... because you have got the slowdown in the U.S. economy, because you have got interest rates peaking and because you still have inflationary pressures -- it will become more challenging for the U.S. dollar to stay strong. And that's positive for the gold price."

Gold often moves in the opposite direction of the dollar as the metal is generally seen as an alternative investment. Safe-haven bullion is also seen as a hedge against inflation.

"We recommend investors use any further dips in gold to build medium-term long positions... We still see gold materially higher on a three and twelve month view," UBS Investment Bank said in a daily note.

(from MarketWatch) -- "Strong resistance in front of $655 continues to cap gold short-term," said James Moore, metals analyst at TheBullionDesk. However, signs of physical interest during the European session are a positive indicator, "particularly ahead of the Indian festival/wedding season, with a period of relative price stability likely to encourage more interest.

"Overall sentiment remains firm with our view of plus $700/oz by year-end still on course, although the market might have to wait till early-mid September before breaking out of its current $605-55 range," said Moore.

"Gold, at these levels and for the next week, is a buy for investors," said Ned Schmidt, editor of The Value View Gold Report.

H40B 2 me -R.
---(see url for full news, 24-hr newswire)---

http://www.moneyweek.com/file/16672/the-real-reason-you-should-buy-gold-now.html(MoneyWeek) August 11, 2006 --

As a rule, money flows where it's treated best. If interest rates are high, then gold performs poorly relative to money. If interest rates are low, money flows toward gold. When interest rates are zero, gold becomes a no-brainer

"But wait," you say. "Interest rates soared in the 70s� how did gold manage to run from $100 to $800 during that time?"

Yes, interest rates soared in the 70s� but let's look at the "real deal" you get for your money. Let's consider the effects of inflation�

The "nominal" interest rates you might see advertised at your bank or in the newspaper don't give the full picture. Here's why: if the prices of the items you buy on a regular basis, like food, gas and accommodations, are rising at 5% and - at the same time - the bank is paying you 5% interest on your savings, the bank is not compensating you for holding your wealth in cash instead of gold.

In this case, economists would say your "real" interest rate�the interest rate AFTER inflation�is actually zero.

Today, we see nominal interest rates advertised at around 5%. At the same time, inflation is around 5%� and Federal Reserve chairman Ben Bernanke says he's almost done raising interest rates... Real interest rates are close to negative� and the smart money is shifting from cash and into gold.

You should own some gold, even if it is purely to lower some of the risk in your investment portfolio, as gold and stocks often move in opposite directions. If you're not there right now, it's time make the move.

^---(from url)---^

A very nice entry-level piece of advice for the garden-variety mainstream reader and investor.

R.

http://www.resourceinvestor.com/pebble.asp?relid=22736Snip:

"...
Venezuela on Thursday began certifying around 235 billion barrels of crude reserves in the vast Orinoco Belt as part of an effort Venezuela says will give it the planet's largest oil supply. Venezuela, the world's No. 5 oil exporter, hopes the process will give a massive boost to its reserves at a time when spiraling energy prices have left oil companies scouring the globe for black gold.

"We are sure that we will incorporate 235 billion barrels of oil to our booked reserves," Energy Minister Rafael Ramirez said during a ceremony to celebrate the opening of the certification campaign in eastern Venezuela.

"Thanks to this effort, Venezuela will become the country with the largest reserves on the planet," he said.
..."

Sundeck: 235 bilion barrls sounds a lot, but really only about seven and a half years supply at the current rate of global consumption of about 83 million barrels per day. And this is leaving aside the "energy balance" issue...how much energy it takes to extract and refine this tary stuff...not to mention the environmental problems associated with the process.

:-(

http://www.myiris.com/newsCentre/storyShow.php?fileR=20060811203534091&secID=fromnewsroom&secTitle=From%20the%20News%20Room&dir=2006/08/11Snip:

"...
Total forex reserves moved up by USD 1.772 billion from July 29 to August 4, 2006. As on August 4, total reserves stood at USD 165.795 billion, as per weekly statistical supplement of RBI on August 11, 2006.

Foreign currency and assets during the week rose by USD 1.394 billion to USD 158.465 billion. Foreign currency assets expressed in USD terms include the effect of appreciation/depreciation of non-US currencies (such as Euro, Sterling and Yen) held in reserves.

The reserve position in the IMF increased by 1 million to USD 766 million during the period under consideration.

The Special Drawing Rights (SDRs) remained unchanged at Rs 330 million as on August 4, 2006. Similarly, the country`s gold reserves increased by USD 377 million to USD 6,557 million.
..."


Sundeck: Gold reserves up US$377M in one week when the price of gold increased by only about 2%, equivalent to an MTM increase of about US$120M on their reserves??

Did they buy US$250M in gold during that week? That's equivalent to about 390,000 ounces...or a bit over ten tonnes.

:-)

snip:

After saying last weekend that it would take all of its Prudhoe Bay output offline for pipeline repairs, BP has done a major about face - now saying that it plans to keep about half of its flow going. Change of heart? Yes, and perhaps inspired a bit by plans of multiple agencies (including the State of Alaska and CONgress) to investigate to see what's really going on.

-Goldilox

Was BP's original announcement a test of the "Cry Wolf" process, or just a poorly researched initial reaction?

http://urbansurvival.com/week.htmsnip:

My eldest daughter sent a rather telling email on Friday. "Do you think the 'terror plot thwarted' headlines are real? I don't think I do..." she wrote. Yes, the headlines are real, but was there another agent provocateur pushing things along? Some blogs and Middle East sources point that direction.

While US media, like Black News Weekly headlines "Terror plot to blowup planes may be a hoax." the travel mess at airports has been remarkable.

-Goldilox

Without actually analyzing the veracity of the story, the media blitz itself and the TSA response was socially devastating. I was attending a conference about 500 miles from home, and those who had to fly to their various home cities expressed everything from rage at the media-fingered perps to rage at the machine and it's unabashed Cry-Wolf prowess. My less stressful reaction was probably weighted by the fact that I used the conference as a "test" for my new "very comfortable" motorcycle seat and had already planned my leisurely ride home on the scenic Coast Highway.

One thing I noticed, after a quick check of the reader response at CNN and BBC. By far, the near unanimous response is, "Strip me naked, if you must, but make flying 'safe' again."

While I am sure that more post-adrenal analysis will produce thoughts on "cause and effect", the initial responses have been a good study in the power of mass-induced fear to illicit mass acceptance of "martial law". . . and of course, we experienced another Web bot hit with the predicted "major travel restrictions".

The other very interesting observation is the containment and actual reduction of PoG during this very stressful period. Unlike the initial Iraq invasion, which gave us a 25% spike, PoG was in reverse proportional lock-step with the Dollar's strength on Thursday and Friday, as if the media terror blitz was non-eventful.

P.S. the previous posts' reference was also from urbansurvival.com.

http://www.bloomberg.com/apps/news?pid=20601086&sid=aZJC7DlXtORA&refer=latin_americaBrazil Real Weakens
as Central Bank
Steps Up Dollar Purchases

By Katia Cortes
Bloomberg News Service
Friday, August 11, 2006

BRASILIA -- Brazil's currency weakened after the central bank stepped up dollar purchases in a bid to boost foreign reserves and slow the real's appreciation.

The bank bought the U.S. currency in the spot market for 2.1620 reals per dollar in an auction today. The bank has offered to buy dollars on a daily basis for more than a month.

"The bank is stepping up purchases because it aims to prevent the real from gaining too much at a time when investors seeking higher rates are approaching Brazil," said Alan Gandelman, a partner at Rio de Janeiro-based AgoraSenior Corretora, Brazil's biggest stock exchange.

The real fell 0.4 percent to 2.1650 per dollar at 3:40 p.m. New York time, after most trading in Brazil had ended, from 2.1565 per dollar yesterday. The currency has gained 9.2 percent in the past 12 months, the best performance among the 16 most-traded currencies tracked by Bloomberg.

The dollar futures contract for Sept. 1, 2006, settlement, the most-widely traded on the BM&F commodity and futures exchange in Sao Paulo, changed hands at 2.1755 reais per dollar from 2.1705 yesterday.

The real also fell today after a U.S. report showed retail sales in the world's biggest economy rose more than forecast in July, fueling concern the Federal Reserve may have to lift borrowing costs again this year. Higher U.S. rates reduce the spread, or extra yield, on assets in riskier emerging markets.

"U.S. retail sales rose more than expected, which goes against the thesis that the U.S. economy is loosing steam," said Tony Volpon, chief economist at Sao Paulo-based CM Capital. "A stronger economy prompts investors to migrate to the U.S. seeking higher rates, helping the dollar to strengthen and other currencies, like the real, to weaken."

Investors took advantage of the real's rally this week to an almost three-month high to sell the Brazilian currency, said Carvalho. For the week, the real has gained 0.8 percent against the dollar.

"It's very natural for the real to fall a bit today after rising all week," he said. "Some investors are taking the opportunity to take profits and are probably using the stronger-than-expected retail numbers in the U.S. as an excuse."

The real may resume its rally in coming days as strong growth and falling interest rates boost investor confidence, said Francisco Carvalho, currency desk manager at Liquidez Corretora DTVM.

A report released today showed inflation in Latin America's biggest economy held at a seven-year low last month. Annual inflation, as measured by the benchmark IPCA index, stayed at 4 percent in the 12 months through July. Slower inflation helps preserve the value of real-denominated assets.

"The scenario is favoring a continuing appreciation of the real against the U.S. dollar," Carvalho said in a phone interview from Sao Paulo. "Investors' risk perception has improved, we continue to have strong inflows from exports, and the perspective is for interest rates to keep falling."

Earlier today, the real traded as high as 2.1544, its strongest level since May 17.

The yield on the benchmark zero-coupon, local-currency bond due January 2008 rose 4 basis points, or 0.04 percentage points, to 14.53 percent, according to Banco Pactual.

On foreign markets, the yield to the 2015 call date on Brazil's benchmark 11 percent bond due in 2040 rose to 6.56 percent, while the yield to maturity rose to 8.373 percent from 8.351 percent yesterday, according to JPMorgan Chase & Co. The bond's price, which moves inversely to the yield, fell 0.30 cent on the dollar to 129.45.

@ CP,

Isn't interesting how the dollar paper market has evolved from "safe-haven" to a derivative bet on short-term foreign policy success in only a few short years?

This does not bode well for paper marekts in general, IMHO.

http://www.commondreams.org/views06/0811-35.htmsnip:

The New Middle East was conceived on the lawn of the White House in September 1993 when Yitzhak Rabin, Shimon Peres, Yasser Arafat, and Bill Clinton shook hands. It was taken up by American, Iranian, Iraqi, Israeli, and Lebanese leaders among others, all of whom have felt at one point or another that it was theirs to control. It now veers between stillbirth and the arrival of Rosemary's baby. The circles of chaos that have enveloped countries across the Middle East, and that threaten the globe by threatening world energy supplies, would seem at the moment to be converging around an Eastern Mediterranean epicenter that is no stranger to cataclysmic disasters, both God-inspired and man-made.

With George Bush still insisting on the need to fight "Islamic fascism" to the bitter end, Labor Party Defense Minister Amir Peretz imploring Israeli soldiers to turn southern Lebanon "to dust," and Iran's Mahmud Ahmedinejad declaring the need to wipe Israel off the map, the hubris, arrogance, and utter disdain for human life that has brought the Middle East to its latest precipice continues to harden the hearts of leaders and peoples alike. And all will be the losers because of it.


-Goldilox

For those interested, I find this professor's analysis to be a reasonably dispassionate overview of the cauldron that the NeoCONs call "the arc of instability" in a media that seems currently embroiled in finger-pointing (or would that be "painting"?)

I'll keep the focus short so this doesn't send us into OT political hell. It might still be far enough off-topic to be worthy of deletion, so it is merely intended as a reference - not a discussion point.

http://www.usagold.com/buy-gold-coins.html

Greetings.....


A.) Why do we still talk about political leaders here in a GOLD discussion room? Just wondering because my post was censored! P.S..I think it's still relevant to the PoG and the world economies.

REF:Goldilox (8/12/06; 09:38:22MT - usagold.com msg#: 146593)

B.) You would be singing a different story if your daughter was on the Jet along with the terrorist who did not get caught! NO CHANCES regarding these_______!!!

REF:
Goldilox (8/12/06; 08:49:30MT - usagold.com msg#: 146590)

C.) Gold will over time hold more value and suffer less depreciation and taxes than other paper investments. I agree!!

REF:TownCrier (8/11/06; 23:11:13MT - usagold.com msg#: 146586)

D.) Looks like they finally came to an understanding....after how many killings? What a waist. Can't people just get along already.

REF:Mr. Goldfinger (8/11/06; 21:03:14MT - usagold.com msg#: 146579)

E.) Small countries need to stop provoking and work with everyone in the International community. After all look what happened to IRAN! WEAPONS OF MASS DESTRUCTION....JOKE! OR PERHAPS WE WENT AFTER THE WRONG COUNTRY!

REF:The Invisible Hand (8/11/06; 20:40:34MT - usagold.com msg#: 146578)

F.)I think the world is Looney over all!!

REF:Paper Avalanche (8/11/06; 18:57:04MT - usagold.com msg#: 146576)

G.) Very good points. I do not ever see the Dollar's Demise. This is the pride of the country. I do think it will have it's ups and downs like most financial tools. I think we all need to take responsibility and watch our over consumption and waist and be a little gentler with the world and its resources. A penny saved is a penny earned...same with commodities and most things..CONSERVE!

Nathan Brazil (8/11/06; 12:07:15MT - usagold.com msg#: 146566)

I am not down on this country...I am down on the people who take for granted all the freedoms and liberties we have. As you can see...things are changing!

Have a fabulous weekend!

I am going prospecting..... GF

@ Gold Finger?

I detect some serious resentment in your post. Join the club. The best of us occasionally run afoul of guidelines.

A. I specifically warned that the Common Dreams reference might be too far afield, and I would not have been offended at all if admin agreed and pulled it. I just thought it was the calmest, least political analysis I had read on the most recent ME quagmire, and suggested it as reference for cooler heads, rather than a topic of discussion.

B. As to George's and my observation of the public frenzy over the "toothpaste fairy," you seem to have missed my point completely.

I specifically said I was NOT judging the veracity of the story, but observing the media frenzy and its effect on the mood of the "markets" and public in general. Remember Gen. Tommy Franks Martial Law warning of not too long ago, whe he said:

"The next victim of WMD is the US Constitution".

E. Perhaps we went after the wrong country, indeed! Do we even dare to address the real weapons and drug sources that prop up the puppet regimes? I think not. The "intel" world would lose all their sources of covert funding and information in the seedier destinations.

G. Potential dollar demise is a great setup for the NWO's desired reassociation into "trading blocks", Euro, APAC, Amero, and potentially "Lafrica", if they survive the growing global unrest. Now if all the "little guys" will just:

"Sit down, Sit down, Sit down!
Sit down, you're rockin' the boat!"

The dollar could likely be a casualty of such "emergency realignment" and make way for a new non-constitutional regime. It's been done so many times before. The "It can't happen here" mentality is more likely to pave the way than stop it.

This is the point where PMs might sever their association to the paper dollar (or whatever) and assist the holder in a transition to whatever emerges - Is this fantasy, or insuring against a worst case scenario?

As Pogo so aptly put it, "We have met the enemy . . ."

Happy prospecting!

Goldilox (8/12/06; 18:50:00MT - usagold.com msg#: 146596)
Change What Story?
@ Gold Finger?
Not only does he have a good moniker he is a decent guy.

Keep up the good work brother.

REF:Goldilox (8/12/06; 18:50:00MT - usagold.com msg#: 146596)

I completely understood your point and offered a brief counter point. The idea that we are all so venerable to world conditions and how they affect us personally is very interesting to me. I like all conversations and just offered a side comment to a few of the ones I've seen here.

So do not take it personally.

I meant/mean no harm.

I guess some are hyper sensitive in times like these. For me...I am at a position to gain more wisdom from all with good debate and discussion!

WE GOLD BUGS WILL BE WINNERS IN THE END!!

CHEERS~

or the global colonialisation of the dominant
rijksdaalder


rijk = empire in Dutch

daalder (in Dutch) (thaller in German?) would be the
etymological origin of "dollar"

rijks-daalder = the imperial dollar


In this globalising world, all export oriented states have to settle their trade, to an increasing extent, in rijksdaalder.

This results in "more" use for the rijksdaalder-currency ...always at the cost of the nation-state's own currency.

Wealth is being produced (and delivered) INTO the global rijksdaalder-system,
whilst the internal economies and their currencies are increasingly being neglected (less interesting-profitable).

The result is that monetary policies of non-rijksdaalder currencies become less and less effective for creating wealth in these non-rijksdaalder currencies.

All wealth goes to the global(ising) rijksdaalder-system and this is a self-feeding process (exportitis).

The globalising rijksdaalder-regime (rijksdaalder-financial capitalism) creates permanent and global empoverishing wage-competition.

One's US rijksdaalder currency is supposed to tell what one's wealth is.
This has become completely absurd. Study the Japan situation (world economy N�2) as the most blatant example.

All the above systemic is the one and only reason that the rijksdaalder-currency must remain strong in gold...or the entire rijksdaalder-dominance collapses.

Simplified, it boils down to : The more "real" global wealth is being created, the more rijksdaalders come into the system....and...the more rijksdaalders that come into the system, the more wealth is supposed to be represented.
It goes without saying that this so called *-rijksdaalder-wealth-* (system) is increasingly being questioned. Is one "really" wealthy with more rijksdaalder-digits...+ a declining purchasing power...+ a killing global wage competition ???

WHAT exactly is backing the supposed rijksdaalder-wealth in this globalising rijksdaalder-dominant-system ??? Is it a rijksdaalder, only strong in gold ...and "weaker" in all the other tangibles (oil/gas) ???
Is the rijksdaalder backed by an all embracing financial industry ...or the illusionary reserve-status of this rijksdaalder-unit???

Can the existing rijksdaalder-regime (financial capitalism)continue to organise empoverishing global competition(aggregate economy) forever ???

Export or surplus wealth must also result in internal investment and return (wealth creation) without feeding the rijksdaalder-system. Otherwise the broad internal wealth building will always lag and perpetuate the murderous (empoverishing) global competition.

This system is the fundamental cause for the rise in global imbalances that cannot be corrected (balanced) without a fundamental (transitional) change.

That change is the new gold-regime (status) !

The psyops shill makes an appearance yet again today.

I am the flashlight on the cockroaches (FWIW).

BTW, the whole thing with the Euro having a greater value of reserves in gold rather than paper "reserves" does now prove interesting.

Good night little shill.

the Paper Avalanche

@ Gold Finger,

I just didn't want you to leave with the impression that because I focused on the effects of the accompanying media circus, I was not empathetic to the major airline disruption itself, nor was I completely dismissing the obvious risk factors.

We are certainly experiencing some VERY volatile times, both in the markets and in general survival, itself.

Most of us can do little about any growing turmoil beyond some simple efforts at increasing our levels of watchfulness and preparedness.

As most martial arts dojos teach, an important preparation for expected conflict is to avoid the most dangerous outbursts when possible.

To paraphrase Black Blade,

Reduce or eliminate debt.
Build a stash of emergency water, food, and transactables.
Learn to duck, and stay light on your feet
Don't bury all your PMs in just one hole!

http://www.msnbc.msn.com/id/14324796/This was free to view on msn so I thought you might like to read it. This kind of violence could really bring a lot of grief to countries and Governments~

http://www.thetruthseeker.co.uk/article.asp?ID=4956SNIPS
According to knowledgeable sources in the UK and other countries, the Tony Blair government, under siege by a Labor Party revolt, cleverly cooked up a new
"terror" care to avert the public's eyes away from Blair's increasing political woes.
+
what prompted Murdoch and Blair to hype a new global "terror" threat was what Murdoch learned from eavesdropping on the phone calls of Prince Charles' staff at the future king's office, home, and limousine. The eavesdropping revealed that Charles was working with Chancellor of the Exchequer Gordon Brown, who is to the left of Blair, to conduct the same type of political maneuver that John Major used to oust Margaret

==

Wasn't it Gordon who proposed to sell IMF-gold was and remains controversial,
Does this not concern a big amount of US of A gold in the IMF?

http://www.jsmineset.com/snip:

The Official Treasury "audited" statement of the financial condition of the USA presents the real financial position.

The present Administration claims a $296 Billion dollar Federal Budget Deficit predicted for 2005. The audited statement reveals a Federal Budget deficit of 720 Billions for 2005.

This audited document from the US Treasury is reported to say that US Government debt is $49 trillion. Assuming this then it is very close to a time when interest on US debt will exceed domestic spending.

Representative Jim Cooper of Tennessee, a member of the House Budget Committee has arranged to have this report reprinted for interested parties.

-Goldilox

Once debt service exceeds income, things get a little tricky.

http://news.yahoo.com/s/ap/20060813/ap_on_bi_ge/demystifying_the_fed1:16p ET Sunday, August 13, 2006

Dear Friend of GATA and Gold:

The Associated Press story appended here
says Federal Reserve Chairman Ben Bernanke
"wants to improve communication" about the
Fed's thinking on interest rates and the
economy so investors, businesses, and
consumers "may be inclined to respond the
way the central bank wants them to."

But if Bernanke ever REALLY wants to
communicate "what the Fed is thinking,"
there is a very easy way to do it: Fully
open to the public the proceedings and
records of the Federal Reserve.

The AP story also reports that Bernanke
has already foreclosed anything close to
that.

As GATA consultant Mike Bolser has often
suggested, the Fed's "communications
policy" may be more important than any
actual intervention in the economy by the
Fed, since, if "communications policy" is
successful, it can induce markets to act
on false pretenses and let the Fed
accomplish its goals without any cost in
actual policy, like raising or reducing
interest rates when raising them to
protect the dollar would sink the economy
and reducing them to protect the economy
would sink the dollar.

This stuff isn't "communication" at all.
It's manipulation.

CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.

* * *

Fed Chief Wants to Improve Communication

By Jeannine Aversa
Associated Press
Sunday, August 13, 2006

WASHINGTON -- Former Federal Reserve Alan Greenspan left the door slightly ajar. His successor, Ben Bernanke, wants to open it a bit more. If investors, businesses, and consumers have a better grasp of what the Fed is thinking about interest rates and the economy, they may be inclined to respond the way the central bank wants them to. And that can help the Fed do its job: keeping the economy and inflation on an even keel.

Bernanke, who took over the Fed in February from the famously opaque Greenspan, wants to improve the Fed's communications with Wall Street and Main Street. It's not clear at this point, though, exactly how he will go about doing so.

For investors, what Bernanke and the Fed says about the economy or other things can be just as important as its interest rate decisions. Wall Street dissects every word, and the market can turn on a simple phrase.

For the Fed, getting its message across can be a challenge.

A former economics professors, Bernanke came to the Fed with a reputation for plain speaking dating to his days as an economics professor. His communications since coming to the Fed have been anything but. The result: skittish investors have sent stocks on a roller-coaster ride.

Experts say it will take time for investors to get used to Bernanke and for Bernanke to sharpen his signaling system.

In the meantime, there are steps that the Fed itself can take to be more open and understood, experts say.

"Right now there is certainly a need for improvement and room for improvement," observes Anthony Sabino, a law professor and business expert at St. John's University. "We demand transparency from private enterprise. Why does the central bank have to be so shrouded in mystery? They got to do better."

The Fed has begun a discussion of ways to improve communications. No decisions are imminent, although Fed watchers say a wide range of ideas are being explored.

A small committee is going to help the Fed "think through our entire range of communications, all aspects ... and try to develop a better, more explicit, and more useful form of communication," Bernanke told Congress last month.

Some Fed watchers suggested that the central bank issue economic forecasts quarterly, rather than the current twice a year. Others recommended including more elements in the forecasts beyond the current projections for economic growth, unemployment and core inflation.

Another suggestion: revamping the policy statements released at each of the Fed's eight scheduled meetings a year on interest rates to do a better job of explaining the Fed's actions and laying out policymakers' thoughts on economic conditions and the future course of interest rates.

On the road to clarity, Fed policymakers need to proceed with caution. Too many changes too soon can backfire and muddle the message, some warn.

"The Fed needs to go one step at a time," advises Lyle Gramley, a former Fed board member.

Some economists suggested adding more details and context to the minutes that now come out three weeks after the Fed's closed-door meetings on interest rates. Last year the Fed sped up the release of the minutes. Investors and economists applauded that move saying it provided them with more timely insights into policymakers' thoughts.

Bernanke believes the Fed's quest to be more open would be aided by numerically spelling out the acceptable bounds of inflation.

The central bank doesn't have a formal "inflation target" now, although Bernanke and other Fed members have suggested their current comfort zone is when "core" inflation -- excluding food and energy prices -- hovers in an annual range of 1 percent to 2 percent.

If investors, consumers and businesses feel confident the Fed will keep prices stable, they may be less inclined to act in ways that could aggravate inflation, may worry less that inflation will eat away at their investments and paychecks and feel better about longer-term financial planning.

Should the Fed televise its interest rate meetings?

Bernanke -- along with other economists -- don't think that's a good idea, saying it would have a stultifying effect on discussions.

"The kind of 15-second sound bite that would come of these things would just be terrible," says Anil Kashyap, professors of economics and finance at the University of Chicago's Graduate School of Business.

Even though economists say there's room for improvement, the Fed is a lot more open than it used to be. For most of its history, the Fed committee that sets interest rates had worked in secret, perpetuating the belief that operating like a Sphinx was the most effective way to carry out monetary policy.

"I beseech you to be as careful as you can," Greenspan once warned his Fed colleagues about talking about economic matters. "The press will be swarming around."

Eventually the theory took hold that clearer signals from the Fed about economic conditions and interest can help shape investor and public perception and assist the Fed in attaining its goals. A breakthrough came in 1994 when the Fed began to state when it was changing the federal funds rate, a key interest rate controlled by the central bank.

Fed policymakers also share their thoughts about the economy through speeches, testimony and other public appearances. While a cacophony of views can be confusing and roil financial markets, some diversity of opinion can be healthy.

"You don't want them to be 'yes' men," says Sabino. "You don't always have to agree with the boss."

they are beginning by knocking the legs out from under gold so in the MORNING ..NY can have their way with the metals markets.


The very knowledgeable Adam Hamilton warned that this might happen ...."history repeats " he says

It's very tricky.....

Could be very steep and very fast .......

it would appear as if (since peace is breaking out in the middle east) that this is also a good time to sell oil reserves to help the panty raid on the metals....

This is a great opportunity to buy $ 20 - 25 sept 07 silver calls......when silver hits $10

tally ho !

I'm curious, why did you pick sept. 07....?

On the day last week the British government supposedly "Stopped" the terror plot gold went down instead of up as most people expected. However, if you know about central bank manipulation of gold and the fact most people that move the market still believe gold is a "commodity" instead of money this came as no surprise. Furthermore, Chris Laird of the Prudent Squirrel has written that the Hedge funds which he says are responsible for 50% of the movement of the financial markets plan on short selling stocks/commodities on a massive scale as soon as the Mideast conflict quiets down as it appears now that it is doing. This would result in a massive selloff of the stock and gold markets. I have heard from some gold experts that gold is "never going to go back down below $500 per ounce". However, I believe that hedge funds with the tremendous amounts of money along with derivatives that unwind in unknown and sudden ways might be able to push gold below $500 per ounce. I think perhaps the Fed also wants to break the back of gold and the gold run up in price because Bernanke needs to actually lower interest rates by year's end so that the housing market doesn't completely collapse due to people forced to switch to a higher interest rate on an ARM.

Anyone else have a different idea on where gold prices are going to head in the near term?

@ Armageddon,

While your scenario is not unlikely, I don't see sub-500 as a very likely target.

Monday morning will tell the tale, but I think a battle around $600 is more likely, given the strength of foreign buyers.

I offer this from no more supportable foundation than my own gut feeling.

Hedge Funds do not control the price of gold. Maybe for short term volatility they can run the stops on the exchanges but that effect will not work forever. The physical market will soon overwhelm all the paper games being played. Gold under $500 is a dream. Russia, China, the Mid-East, etc... are all buying gold now (whether anyone believes it or not is irrelevant..it is happening). And no matter what the media would have you believe, gold supply is dropping, not increasing. Short-term (as in before the end of the year)I believe there will be fireworks in the precious metals that will shock everyone with how fast and furious it moves to the upside. If i'm wrong, then it will just happen next year or so. It is inevitable now.

Raw materials continue to be traded in rijksdaalder and this results in the rijksdaalder gaining more depth (tradeability-transactibility) on a global level.

A/FOA/TG were hoping that the gold euro would counter this. But the gold euro is being faced with a swelling ocean of rijksdaalder-transactions.

If China's financial/monetary market would now be broken, then we have absolute rijksdaalder world dominance.
Then every corner of this globe will be "dollarised" and "everything" becomes a "rijksdaalder" derivate.
Everybody will then be forced to continue to transact with this all-encompassing rijksdaalder-debt-unit.

Because of the overwhelming rijksdaalder volume and rotation, the debt aspect plays no longer any role because "everybody� is using it � and nobody takes (wants to take?) the valuable gold euro into account.

The gold euro has no world-level banking giants, like JPM/C and GS, who collaborate with her.

Our good baby (the gold euro) finds no customers. Certainly not when the price of gold (POG) has, for pragmatic reasons, to be under a controlled revaluation, linked to the rijksdaalder (exchange rate).

The gold euro is too slowly evolving versus the rapid rise of the globalising rijksdaalder � rijksdaalder whose annihilation under its own weight is thereby being delayed.

Japan with all its invisible stinking insolvability remains insulated from gold. Japan's economy continues its journey while the government of Japan has a debt of 160% GDP and while its banks and crashed stock-market are being fed yen by the Bank of Japan.

Nobody utters a word. Japan and its giant savers must remain under the US of A umbrella, n�est-ce pas?

The all-encompassing rijksdaalder world order is reigning sovereignly. What currency will rebuild Lebanon and Iraq? The rijksdaalder of course.

Euroland is not doing enough to build its alliances with Asia, Russia and the Middle-East. Out of fear for new 9/11 c.q. London terror?

A very difficult choice, indeed.

Europe is afraid to retake its place in the war arena. Fear of WW III?

Europe's neutrality is costing precious time for the gold-euro.

Meanwhile, the rijksdaalder regime is not too aggressive vis-�-vis Chima and Russia because the latter two are in a position to end the rijksdaalder dominance by allying themselves with the gold euro.

http://www.shopathometv.com/catalog/thumbnail.jsp?Ntk=1100001&N=1101720&Nty=1&categoryId=4021&pCategoryId=1806&gpCategoryId=1188&nomerch=1It's all relative....right?

NEWS FLASH...terror level dropped!!

I was watching the late night TV and noticed the shop at home network with their salesmen who have a southern accent worse than Dr. Phil....anyway, they would not shut up about how fabiolus the new pure buffalos/Indian gold coins were.

They touted it's rarity and how in a few short months it will be even more valuable with CHINA'S new gold laws.

They also said you could melt it down and get at least the spot price with your first payment....That's right for only 2 super easy payments you can have the US government rare coin with only 100,000 left for a mere 1,199.00 or 2 payments of 599.00 each!

Now that just shows what a barging we have here with our host!! So stop gabbing and start buying!!

GOLD the new weapon of mass destruction!!

:-)

http://news.bbc.co.uk/2/hi/middle_east/4789569.stmsnip:

According to the Haaretz newspaper, Mr Olmert ordered Israeli forces to begin observing the terms of the ceasefire at 0200 on Monday (2300 GMT) after meeting with Defence Minister Amir Peretz and senior army staff.

Southern Beirut continued to take hits from Israel on Sunday
However, the breakdown of Lebanese government discussions could hamper the implementation of the ceasefire, which calls for 15,000 Lebanese troops to replace a disarmed Hezbollah in southern Lebanon.

Hezbollah's leader, Sheikh Hassan Nasrallah, vowed over the weekend that his fighters would respect the ceasefire but would resist any continued Israeli presence in Lebanon after the deal came into force, raising fears of further clashes.

Some Israeli troops will remain in southern Lebanon to hand over to an international force, and few expect the hours and days after the ceasefire begins to be entirely peaceful.

"You can't move from black to white easily - there will be a period of grey," said Major General Benny Gantz, the head of Israel's ground forces.

All Olmert has, like his fellow appeaser Chamberlain before him, is a piece of paper.

Overall the language from both sides suggests nervous times ahead, with both sides on tenterhooks, ready to pounce on anything they see as a ceasefire violation, says the BBC's Rob Norris in Jerusalem.

-Goldilox

While the media and anti-gold forces will try to claim the "peace has broken out," it remains to be seen!

http://www.usatoday.com/money/industries/energy/2006-08-14-bp-cover-usat_x.htm75% water cut. That's a lot of water. Lots of tidbits if you can work through the environmental slant. They expect to be pumping for 50 years more. At 3.5% decline per year that will be an 83% decline from today's production rate.

As with gold mining, the "ore quality" goes down and the costs go up. At some point, the future isn't easy pickings. Yes the current profits are large, but the required fixes to maintain the flows are so large as to be out of reach. "Shut-er down bub, she's suckin' mud!"

The market questions the future value of oily paper. Perhaps it too is a message that ALL paper is an "oil derivative". A very scary message indeed.

http://www.nymex.com/media/delivery.pdfJudging by the Deliveries today someone sees the current price levels of Au and Ag as a buying op. Can't says I agree with them tho, but it IS getting close.
The traditional demand driven price run-up period should kick in before months end and Aug-Sept roll-over this year could be "memorable".

We watch!

and i see the barrick vs novagold hubbub as the same tired old story of people trying to put on a public service mask to cover their self-interest-serving faces.

i'm not that clever to dress myself up in fancy masquerades, but being human i'm surely just as self-serving. so if i'm of a like mind that barrick (among others) have collaborated to suppress the price of gold, then you'll all understand me and forgive me when i baldly serve my own interest and gladly sell the hell out of novagold while the gettin's good and buy plenty of metal using barrick's blessed price subsidy for as long as they can keep at it.

thankyou!

http://www.usagold.com/DailyQuotes.html
The Daily Gold Market Report has beenupdated.

If you are considering investments in gold we invite you to request our freeintroductory information packet detailing the products and services offeredby USAGOLD ~ Centennial Precious Metals. We welcome your inquiry and lookforward to working with you.

MONDAY Market Excerpts

Gold and oil prices cheaper on ceasefire

August 14 (from DowJones) -- Comex gold futures followed crude oil lower as a war premium eased on Monday amid news that a U.N.-imposed cease-fire was called in the Middle East. At settlement, December gold was down $5.10 at $639.30.

Analysts at TheBullionDesk said the apparent reduction of safe-haven concerns following the Israeli cease-fire has kept gold under pressure, "however with Iraq still on the verge of civil war, and Iran and North Korea's nuclear policies a cause for concern geo-political tension are still extremely high," with some investors likely to view gold's current dip as a good area to enter the market.

"Overall the lack of convincing direction on either side, coupled with the summer holiday season should see gold spend more time treading water in its wide $605-$655 range," said the analysts.

(from MarketWatch) -- "Gold [is] moving to near optimal short-term oversold between now and Wednesday [on] excessive optimism," said Ned Schmidt, editor of the Value View Gold Report.

"Investors able to see past morning news should be buying through Wednesday."

Indeed, "the markets are being whipsawed by every minor news item and comment by anyone of any importance around the globe," said Dale Doelling, chief market technician at Trends In Commodities. "This makes for an extremely difficult trading environment."

If current market conditions are short-lived and short-term trends emerge once again, "the likelihood that the metals markets can push to new all-time highs will rise dramatically," he said.

Prices may see a "major rally" in early September, according to Peter Grandich, editor of the Grandich Letter, who said he believes gold is going through a "classic bull-market consolidation."

"A new yearly high above $735 is likely before year's end thanks to a combination of geopolitical concerns here and abroad, strong seasonal demand and the recognition that the U.S. dollar is terminally ill," he said.

Analysts at Standard Bank noted that gold may begin to attract buying interest from investors in the oil-rich Middle East in light of the recent correlation between gold and crude prices.

"Historically, gold and crude oil have moved in rather similar patterns, and statistically, the gold-to-crude ratio averaged around 1:15, up until recently with current cross valuation at about 1:9," they said in a note to clients.

"This suggests that gold is relatively undervalued in terms of crude," Standard Bank said.

---(see url for full news, 24-hr newswire)---

http://www.busrep.co.za/index.php?fSectionId=561&fArticleId=3389242HEADLINE: Newmont faces Uzbek crackdown over tax bill

August 14, 2006; Denver -- The government of Uzbekistan has launched a criminal investigation into Newmont Mining amid a $48 million (R325 million) tax dispute threatening its gold operations in the central Asian country...

[The company] acknowledged that the situation had deteriorated and said it had placed employees on leave during negotiations with government officials.

"At this point, the company no longer has day-to-day control over [the joint venture's] operations," Newmont spokesperson Randy Engel added.

Newmont said Uzbek officials had blocked the venture's gold shipments out of the country and assets had been seized.

In addition, the European Bank for Reconstruction and Development has told the joint venture that funds in its account were no longer available.

^---(from url)---^

There seems to be no end to the examples in which in-ground resources on sovereign turf are demonstrated to be the ultimate SITTING DUCK.

If you want the best assurance that your gold investment remains "as good as gold" during the entire duration of your investment, be sure to gravitate toward fully-paid gold coins in your possession as the most liquid and portable personal property within your estate. In this form it is definitely NOT a sitting duck.

R.

http://service.spiegel.de/cache/international/0,1518,431329,00.htmlSNIPS
SPIEGEL ONLINE spoke with terror expert M.J. Gohel about the effectiveness of security measures, the creation of new terrorists and how the West can win the ideological battle.

....UAE + Pakistan + Saudi Arabia, regarded as staunch allies of the West....

==

UAE, Pakistan and Saudi Arabia are
the three states which recognised the Taliban
the three states where the press continues to argue up to today that 9/11 was a CIA-Mossad operation.

Mister Gohel is thus a member of the Internationalistic intriguers who have to keep the west under THEIR "terror" theory, their rijksdaalder world order theory of freedom and demokracy.

This block is being opposed by Another pragmatic block, Russia and Asia, for which this theory has no relevance.

http://www.ft.com/cms/s/edea35c0-2bba-11db-a7e1-0000779e2340.html
UK to make new security rules permanent...

Will this be the death of the USD? Imperialism cannot survive if it cannot conquer and kill it's enemies. The modern Israeli army utilizing billions of dollars worth of American military technology finds itself no closer to freeing its two soldiers after having a couple dozen soldiers killed and millions of dollars worth of munitions spent. Perhaps the US used Israel to "count the cannons" kinda like the Canadians were used at Dieppe. If so they must surely see that they can not possibly win a war with Iran. Vive Lebanon! Vive le revolution!

"GOLD the new weapon of mass destruction!!

Many post here to educate. Some post here to argue and discuss the points that the educators posit for the edification of the forum's patrons. Others post with no real information and, if I were a conspiracy theorist, to subvert the intent of the forum by going out of their way to appear to be "one of the gang" and then finish with a zinger that would make someone new to the forum think "I don't want to be considered a gold proponent, they are considered to be anti-government, pro-end-of-the-world kooks."

Shill fishing..... caught one!

PA

http://news.bbc.co.uk/2/hi/middle_east/4790681.stmsnip:

It is too early to say who "won" the war over southern Lebanon because, despite a ceasefire, the fighting might not be over.

Despite the ceasefire, fighting might yet continue
And beyond that, the political and military structures that might prevent a future conflict have yet to be put in place.

If these structures (removal of Hezbollah from south of the Litani River and removal of Israeli forces altogether, extension of Lebanese government authority and army in the south, insertion of major international force), are successful, then Israel might claim a victory of sorts. Hezbollah would not have been crushed but it might have been contained.

But the potential for a prolonged and messy guerrilla war is huge and if that happens, Israel would have lost.

In the Middle East it is unwise to judge events too quickly. In the long struggle between the Israelis and Palestinians for possession of the land, many so-called landmarks and signposts hinting at a final destination have been passed yet the road never seems to end.

We do not yet know how this round of fighting and the subsequent set-up in southern Lebanon will evolve.

So whether this will turn out to be a turning point towards peace on Israel's border with Lebanon (adding to the peace it enjoys with Egypt and Jordan) remains to be seen.

-Goldilox

Like the press, PMs, the political stability measure, don't really know what to make of the truce. Peace, or just rearming?

This morning's early action looked like the peace believers won out, but that did not last more than an hour or so into the sessions.

PMs and miners rallied mid-day, to give some of it back again into the close.

Refried confusion!

Someday depending on my mood I can be overly cynical and perhaps a tad sarcastic. I do see a lot of humor here and a lot of nonsense. Most should be taken with a grain of salt.

Perhaps a gram of gold?


The REAL deal is what's do most of this forums discussion have to do with gold anyway?

Commodities are seriously affected by world conditions and leaders. If a country wants to seize a mine it seem like they can....what's to say they can't seize what's in your treasure chest...??

So how do you reference GOLD? Good or Bad?

So why do I actually purchase gold coins on a monthly basis? How crazy is that?

@ Paper Avalanche. Kind Sir please enlighten me. I am aged 76 but this is the first time I have encountered the word "shill". Its not in my simple dictionary either.
Perhaps its a new word from the Estados Unidos? I live, and was born far from that country in another hemisphere altogether but I do know that you use some quaint expressions in that country.

I am finding that certain people on this Forum recently are, IMHO, stretching the guidelines set down by our host.

Paper avalanche, I do appreciate your contributions.

BTW, any idea when the Estados is going to make the change to metric? You are just about alone and isolated using the old units imposed on you years ago by England. I ask this because I believe using the old units caused a lander to crash on one of our fellow planets because someone used yards instead of metres. Expensive for the taxpayer!

I strongly agree that the Barrick takeover of NovaGold is a cartel inspired coup in the making. A takeover of NG by Barrick could set back the timing of free gold by a year or more as the "deep storage" reserves of NG are used to support the paper shorting or physical sale of gold held by cartel members (including US Treasury).

I would recommend that NG contact China, the UAE and other parties that heve expressed an interest in increasing their gold reserves. China's recent takeover attempt of Unocal indicates their willingness to obtain critical materials in situ anywhere in the world. I say this recognizing that it may be impossible to find a North American or other potential white knight gold company to compete for NG because of cartel controlled shareholdings and/or lines of finance linked to those gold companies large enough to make a serious bid.

Certainly a bid from China, even if it was not ultimately sucessful, would get the attention of cartel members and help to smoke out further evidence of gold suppression.

http://www.smh.com.au/news/business/lets-get-loded--its-a-whole-new-show/2006/08/11/1154803094600.htmlDiggers and Dealers

Well, there you have it. The Diggers and Dealers conference comes and goes in Kalgoorlie with not one mention on this forum...unless I am mistaken. And all this in one of the premier gold provinces of the world. Anyway, the link gives a brief run-down from the Sydney morning Herald of a few days ago. (Nice picure...note the golden theme.)



@ Sir Golden Lionheart. Don't you hail from around those parts?

I'll let Sir Paper Avalanche enlighten you further, but I think a "shill" is a kind of secret mole planted in a gathering to intentionally corrupt the proceedings for some partisan reason. One can imagine "shills" cropping up in all sorts of forums...and the internet is a great place to try out your shillish skills, because people only get to see what you type, without the revealing body-language. There are probably even "virtual shills" on the internet...that is, computer codes that "intelligently" interact with the gathering in a partisan and corrupting way...computers can move more rapidly and cover more ground than even the very most adroit human shill...and you don't have to be toooo clever to get people to unload.

No worries Sir Golden Lionheart...know your own mind and think for yourself and "shill be right", as we say in Oz...

;-)


@ Sir Gold Finger

Are gold-bugs crazy? Good question! Many an ardent shill may think so...or at least try to generate that impression. But consider the question from several standpoints:

1. If gold-bugs are considered crazy, then it wasn't so long ago when most of the world was crazy. Consider the role of gold in the European colonisation, exploration and "development" of the continents of the Earth...few places are untouched by this "bunch of crazies".

2. Similarly, it was not so long ago when all the bankers, financiers, economists and global leaders from Churchill to Croesus were afflicted by this same craziness. If latter-day gold-bugs are crazy, then they are in good historical company!

3. The US treasury is crazy too. Not only do they retain 8000 tonnes of gold on their books, but they insist on "valueing" it at $43 per ounce! How crazy is that?

4. Large holders of US dollars are the craziest of the crazy, because anyone who knows anything about money knows that this is just a hollow promise, supported by ingrained perception and a dated modus operandii that everyone is obliged to follow. While-ever the world continues to play in Casino Globale, there will be strong demand for the tokens of the house... A crazy place indeed, but not without a lot of fun and achievement.

5. A majority of women and men are just incomprehensibly crazy too. Just look at the number of jewellery stores all over the place and the number of women with golden rings on their fingers and men, as well, with that tell-tale band of gold on their outstretched paw which says: "Hang on ladies, this guy is probably not fair game!" Why don't people wear teflon bands instead...and clutter the jewellery windows with iron nails and chewing gum? Crazy if you ask me...

6. I could go on and on and on...but then you might think that I have gone crazy...and perhaps I have. This world is a crazy place sometimes...

Cheers

:-)

someone who, despite admin warnings, posts misleading information concerning a leak of oil from the Alaskan pipeline in a too-earnest, but polished, fashion shows a shrill spill shill skill still ?

Sorry, more coffe required.
C!

http://m-w.com/cgi-bin/dictionaryMain Entry: shill
Function: noun
Etymology: perhaps short for shillaber, of unknown origin
1 a : one who acts as a decoy (as for a pitchman or gambler) b : one who makes a sales pitch or serves as a promoter

C!

@ Clink,

Thus making your glee at onomotopeic digital identification a:

Kill "shrill spill shill skill still" thrill?

Try saying that aloud once wihout practice - LOL.

The term "shrill" can be used as an insulting descriptive, used in the context of someone who is often angry and rude.

A chill pill coupled with a coveted seat at the table, (thank you SIR MK).......priceless..get yours............................................AMF

wrong thread..............crowd psychology....AMF

http://news.bbc.co.uk/2/hi/americas/3026856.stmsnip:

The US president is celebrating a major legislative victory after Congress approved the biggest overhaul of the country's health care plan for elderly and disabled people since its creation nearly 40 years ago.

Reform of the Medicare system, passed by both houses, reduces the cost of drugs for pensioners and gives them access to a wider range of new medicines.

"Seniors have waited too long for more choices and better benefits, including prescription drug coverage, similar to the kind now enjoyed by federal employees and members of the Congress," President George Bush said in a statement.

-Goldilox

While seemingly OT, and quite "old news", the Medicare "reform", which can be more reasonably labeled "public subsidy" for Big Pharma, adds more covert ballast to ill-measured inflation.

In order to pass their massive subsidy plan for Big Pharma, they needed to convince the public that it's really a "public subsidy" with their "spin doctoring". Since politicians know that the electorate cannot resist raiding the treasury, they just relabel their corporate raids as public benefit - not unlike Kelo vs. New London, where a private shopping mall was created by Eminent Domain property seizure.

What ever happened to corporations pricing their goods by "what the market will bear"? Capitalism is not dying, it's being killed off by increasing government participation, aka socialism with a "twist".

Why are gold, oil, pharmaceuticals, etc., not priced appropriately? Look no further than direct government participation in the markets for the answer.

Those who support "growing" government in the name of "freedom", are really fueling a covert socialist transition, often without recognizing it as such.

http://urbansurvival.com/week.htmsnip:

The nicest thing you could do right now would be send an email to every one of your friends and let them know UrbanSurvival.com is back up - hackers overcome. Even if your friends don't read it, if they would just look at it once, today, then that will help propagate the new DNS server around the planet. - thanks!

-Goldilox

Maybe he pinched a nerve with one of those web bot thingies! There seems to be a number of UrbanSurvival readers here at the forum, so we can help him out by accessing his site from various word-wide locales, and rebuilding his DNS linkage.

I know that persons contemplating buying gold freqently want advice on exactly when to jump in (as I did), so here something I found to be helpful.

The mathematically inclined can simply compute the price of gold tomorrow, or at any future date:
Here are some of your variables (I leave determining the rest as an exercise):

B U.S. Bond action
C China Central Bank Actions (break out currency and gold separately if desired)
J Bank of Japan actions
L Jewelry Purchasers (India)
F U.S. Federal Reserve Actions
G U.S. Government actions (invasions etc)
P Factors affecting gold Producers (war, labor, politics)
R Russian Purchases / Sales
E England CB actions
H Hedge Fund actions
A Arab Middle East Purchasers
O Impact of Oil factors
M Them (the Manipulators)
S Small Investors
I U.S. Inflation
W Rest of World inflation
V Inversion Factor (When present, causes any of the above terms to have opposite the expected effect, thought to be related to "M")

Simply determine the relationships between all variables and construct an equation to solve for the price action.

(Instructor's note: Having enough money or clout to directly affect a major term will be considered cheating.)
================
NOTE: A much simpler expression is available (and widely used) to reveal the mystery of yesterday's gold price movement,

"Gold moves (direction) on (random financial headline or world event)". This has the added benefits that it is 100% accurate and can be completely automated.
================
For a bit less tongue-in-cheek, if we ordinary people think we know the inevitable movements of some of the terms we may hope to guess price in the intermediate timeframe or actually predict the long term movements. For most readers this results in the decision to trade paper dollars for gold right now (whenever now is) as much as you can!

You're ALMOST right about no mention of the conference.

But...

truth be told, the brief newsblurb I posted last week about Newcrest Mining's chief, Ian Smith, making a forecast of $1,000 gold was a D&D item from Kalgoorlie.

Weak stuff, to be sure, but better than a shutout!

Cheers!

R.

http://www.easybourse.com/Website/dynamic/News.php?NewsID=42203⟨=fra&NewsRubrique=2August 15th, 2006; ONDON -(Dow Jones)- With European central banks unlikely to opt to sell the maximum allowable 500 metric tons of gold in their annual quota, gold prices should benefit from the reduced physical supply, according to a report by London-based consultancy Virtual Metals Ltd.

The 15 central banks under the European Central Bank Gold Sales Agreement, or CBGA, are entitled to sell 500 metric tons of gold a year under the agreement, but sales only stood at 331 tons at the end of July, the report said.

Failure to sell the 169 tons of gold remaining before the Sept. 26 deadline would mean there would be less gold available than expected this year, the report said. It would also change assumptions about how the 500-ton quota will be sold in subsequent years.

"With just two months to go of the European Gold Agreement, the signatory Central Banks are going to have to quicken the pace of their sales substantially if they are to hit their 500 ton limit and it seems unlikely they will," says Matthew Turner, analyst at Virtual Metals.

Even so, if central banks decide to sell the remaining amount in the next two months the impact on the gold market will be "major," according to Turner.

^---(from url)---^

I find it more likely that any sudden last-minute acheivement of the "quota" target wouldn't matter one way or the other -- due to the off-market nature of these very special gold operations.

R.

http://www.lbma.org.uk/clearing_charts.htmA/FOA used to say that LBMA clearing volume would fall to zero as paper gold market is replaced by physical market. Recently, the clearing volume in ounces appears to be increasing. How should we interpret this? Thanks in advance...

http://english.ohmynews.com/articleview/article_view.asp?article_class=5&no=311015&rel_no=1(2006-08-15) -- Times have changed in Nepal. The price of gold has skyrocketed. Crowds gather in jewelry shops to see the latest designs. To take advantage of the craze for ornaments, new stores are opening up.

According to shopkeepers, the consumption of gold is increasing. They say gold ornaments sell best for festivals, like Teej, Dashain, and Tihar, and marriage ceremonies. In Nepal, it is believed that gold attracts wealth to a household if bought during such periods.

Jewelers say there has been a revolutionary change in the buying habits of people over the last few years... globalization has played a part in this change.

Ram Prasad, who works in a government office, ... says he prefers to give gold as gifts because it retains its value.

^---(from url)---^

"...gold attracts wealth to a household if bought during such periods."

More accurately and instantaneously, the gold IS the wealth added to a household when it's bought. It's as simple as that.

R.

My interpretation is that a bit of transitional time is being bought.

Did you see my post last week about ScotiaMocatta boldly [defiantly(?) madly(?)]stepping in to absorb some of the positions being vacated in this time period by the likes of Rothschild and their peers who have already quit or are currently quitting the bullion banking scene?

R.

http://today.reuters.co.uk/news/articlenews.aspx?type=reutersEdge&storyID=2006-08-09T084842Z_01_NOA931582_RTRUKOC_0_FEATURE-SIERRA-LEONE.xml&archived=FalseIs this a new potential producer of gold? Will it suffer the same taint as the diamonds?

http://www.usagold.com/DailyQuotes.html
The Daily Gold Market Report has beenupdated.

If you are considering investments in gold we invite you to request our freeintroductory information packet detailing the products and services offeredby USAGOLD ~ Centennial Precious Metals. We welcome your inquiry and lookforward to working with you.

TUESDAY Market Excerpts

Tame PPI sees gold, oil and dollar all lower

August 15 (from Reuters) -- COMEX gold futures ended lower with oil prices on Tuesday, but pared initial declines when the dollar slid on tame U.S. producer prices, traders said.

Though technical factors have been driving gold lower during the slow vacation season, traders said dollar weakness throughout the session offered support.

A decline in the dollar often helps lift dollar-denominated gold prices by encouraging buying among overseas investors.

The December gold contract was down $6.40 at $632.90 but up from the session low at $630.50, a level last seen on July 26.

The dollar tumbled after a weaker-than-expected U.S. producer price index for July reinforced the view that the Federal Reserve may not need to resume its credit tightening policy in September.

Traders said the summer vacation period has made trading more difficult, and many of those who were still participating on Tuesday stepped to the sidelines after the inflation numbers to see if Wednesday's consumer price report would confirm the benign wholesale price data.

Traders have said active short-term players seem to be taking their cues from technical factors lately.

"More people are trading technicals than anything. Gold seems to be responding without rhyme or reason to fundamentals, so it's harder to trade them right now," said one trader.

---(see url for full news, 24-hr newswire)---

http://www.usagold.com/amk/newsgroup-form.htmlIf you haven't joined the Group, here's what you're missing:

* * * * Who is calling for $700 gold by the end of the year and why.

* * * * How the central bankers intend to divert the deflationary endgame and what it means for gold.

* * * The significance of falling central bank gold sales and mine company "dehedging" now running at record levels

And. . .

* * * * * Will the Middle East crisis derail the global economy? A haunting message -- a 5-Star Stephen Roach special

And a Note at the top by way of perspective for those a little restless about the doldrums . . . . .

We invite you to join by going to the link above. It's free. It comes by e-mail and we rate the content on a five-star basis.

Can't believe how many sign-ups we get every time we run a post like this. . . . .

What are ya nuts? China? You want Nova to be controlled by China? Haven't they taken away enough business from North America?

Let's not call it "manipulation" - that doesn't sound acceptable. Let's call it "intervention" in the gold market. What could be more normal? After all, all the big countries and some smaller ones intervene in their foreign exchange markets to bolster, or as in the case of Japan, keep their exchange rate down. Why shouldn't we expect the same to happen in the case of gold?

Just take a look at today's (and previous days') graph for gold prices at the "other" site.

A line of prices that want to up, and BANG! a slash of selling to bring the price down, time after time, today.

Evidently, Paulson (or who else?) intends to keep the price of gold down below $625. No holds barred. The seller(s) are throwing everything at the gold price. It appears the effort is desperately important. Pre-emption?

Such an effort requires selling substantial quantities of physical gold - not only paper gold on the COMEX.

The quantity of gold required will eventually draw down supplies available. It happened before, when the US sold enormous quantities of gold back in the 70's. Eventually, they gave up.

The same must happen again. We don't know how long it will take, but these wise guys are making gold purchases for the rest of the world, extremely attractive. The lower the price, the greater the attraction - not the less!

I expect a vertical rise in the price of gold, at some point. When? Hard to tell, but that's what will happen.

Buy gold at any price.

Thanks to everyone who contributed to my education about the word shill. I get the gist of what it means now.

Sundeck. I now live on the West Coast but follow the Diggers and Dealers annual "swim through" of the Kalgoorlie bars. Of course most of it is pure promotion of exploration companies that we cannot talk about on this Forum.

The dow at 11,300'ish means nothing to me anymore. The 10y bond market is irrelevant. Ever since the murder of M3 and the funny Carribean Hedge Vortex in the TIC report, I just dont give it much weight. Now I begin to doubt the hydrocarbon inventory figures.

It is always a search for USEFUL information, and it is getting harder to find. The oddity of lowball PE's on oil equities seems to me to want a good explanation. What the market belives about the future earnings for that slice of the energy industry is a mystery. Perhaps a greater storm is brewing. Perhaps we get a buying opportunity for gold.

Or perhaps the days of sub-$1000 gold will end very soon. The oil PE's are telling us something, I think it is a key anomaly. Oil futures and oil PE's are having a dispute. The oil/gold ratio has been too low for too long.

The hour is late, soon the last of the summer nights will pass and with them the cheap abundant summer fruits; then comes the harvest season when the brokers strap themselves back into their cockpits.

...ahhh yes, that explains it!

"On Aug. 16, 1977, singer Elvis Presley died at Graceland Mansion in Memphis, Tenn., at age 42."

http://www.nytimes.com/learning/general/onthisday/20060816.html?th&emc=th

He produced 141 GOLD, platinum and multiplatinum records in his short life.

http://www.elvis.com.au/presley/biography/elvis_presley_gold_and_platinum.shtml

(Sundeck: Wonder why they call them "gold records"?


Other notable events of this day include:

- 1948 Baseball hall-of-famer Babe Ruth died at age 53. (Sundeck: Mmmm...a sad day indeed...)

- 1987 Thousands of people worldwide began a two-day celebration of the ''harmonic convergence,'' which believers called the start of a new, purer age of humankind. (Sundeck: Purer age, eh? Purer violence perhaps??? Ahh well, where would we be without hope and faith...)


;-)

http://www.thestar.com/NASApp/cs/ContentServer?pagename=thestar/Layout/Article_Type1&c=Article&cid=1155678611255&call_pageid=968350072197&col=969048863851snip:

WASHINGTON�AOL is preparing to dig for buried gold and platinum on property in Massachusetts owned by the parents of a man it sued for sending millions of unwanted spam emails to its customers.

AOL said yesterday it intends to search for gold and platinum bars the company believes are hidden near the home of Davis Wolfgang Hawke's parents in Medfield, Mass. The family said it will fight in court to oppose AOL's plans.

AOL won a $12.8 million (U.S.) judgment last year in U.S. District Court in Virginia against Hawke but has been unable to contact him to collect any of the money he was ordered to pay in the lawsuit.

"I don't care if they dig up the entire yard. They're just going to make fools of themselves," said Peggy Greenbaum, Hawke's mother.

AOL defended its efforts.

-Goldilox

More "late-night" entertainment. If you're related to someone who owes money, your assets can be ruined looking for it. More litigeous silliness, really.

http://yahoo.reuters.com/news/articlehybrid.aspx?storyID=urn:newsml:reuters.com:20060816:MTFH81074_2006-08-16_07-10-15_L16529798&type=comktNews&rpc=44TASHKENT, Aug 16 (Reuters) - A court in Uzbekistan has initiated bankruptcy proceedings against the local joint venture of U.S. gold miner Newmont Mining Corp. (NEM.N: Quote, Profile, Research), according to a statement published on Wednesday.

Newmont's difficulties come at a time when Uzbekistan's relations with the West are strained following strong Western condemnation of a bloody crackdown on a rebellion in the Uzbek town of Andizhan in May 2005.

On Tuesday, Uzbekistan revoked a licence held by Britain's Oxus Gold Plc. (OXS.L: Quote, Profile, Research) to develop a zinc and gold deposit in the south of the country, sending the company's share price down more than 8 percent on the London Stock Exchange.



The state Committee on Demonopolisation said in a statement published in Uzbekistan's Narodnoye Slovo newspaper that the venture's creditors would meet on Sept. 19 to discuss the matter.

It added that the committee was temporarily in charge of managing the venture's operations.

The Uzbek government and Newmont could not be reached for comment.

The Zarafshan-Newmont Joint Venture, 50 percent owned by Newmont and 50 percent by the former Soviet republic, is facing two tax claims for a total of $48 million.

Newmont said last Friday it had lost day-to-day control over the joint venture and that it believed the government was seeking to expropriate its share of the operation.

Newmont's 50 percent share of gold sold by the venture last year was 122,700 ounces. By comparison, Newmont expects to sell a total of about 6 million ounces of gold this year from all its operations worldwide.

The U.S. company has said it will seek international arbitration.

Good story. I guess eminent domain doesn't apply where barbarous relics are nearby. "Let's have our cake and eat it too, and then they can clean up after us!"

Should the lawyers for AOL win the suit, it's like a de facto eminent domain forfeiture it seems.
They condemn the land(and have their way with it) confiscate any golden "real property" found and leave without just compensation. We don't pay taxes for nothing!

http://quotes.ino.com/chart/?s=NYBOT_DXThe $ is not doing well this moning, and the previous battles seem to have succumbed to step-falls for now.

http://www.fin24.co.za/articles/economy/display_article.aspx?Nav=ns&lvl2=econ&ArticleID=1518-25_1983869Gold investment demand up 19%
16/08/2006 17:51 Snippits:
Johannesburg - Strong demand from investors across almost all categories drove investment in gold to high levels in the first half of 2006, the World Gold Council (WGC) said in its latest report released on Wednesday.
In the second quarter total identifiable investment demand for gold rose 19% to 130 tonnes and 75% in value terms year on year, taking the total value of identifiable investment for the first half of 2006 to $6.1bn.
"Increased investment brought added volatility to the price, which, at an average of $627.71 for the quarter, was 13% higher than in Q1 and 47% higher than in Q2 2005," the WGC said....
While demand for gold is on the up (and despite an increase in the supply of scrap) overall gold supply was "constrained" in the second quarter of 2006 as a result of lower central bank sales and substantial de-hedging by gold mining companies, the WGC also noted."

As reported consumption figures can show currents and trends, unreported trades act as undercurrents that will surprise many observers. Still even WGC data is impressive.

http://www.usagold.com/gold/special/southamerica.html

South American Coin Sets! *LIMITED TIME*

http://english.people.com.cn/200608/16/eng20060816_293731.html(Xinhua) August 16, 2006 -- Vietnam has reduced its import tax on gold bullion to 0.5 percent from one percent...

The tax decrease recently decided by the Vietnamese Finance Ministry is a move to develop the domestic gold market...

The country has around 8,000 gold trading firms.

^---(from url)---^

One step closer to market freedom.

R.

Goldilox (8/16/06; 09:41:11MT - usagold.com msg#: 146658)
New Waterfalls for the Sawbuck
http://quotes.ino.com/chart/?s=NYBOT_DX
---
YES, Sir Goldi --- LOVE those daily WATERFALLS !
I like to go look at the base of those falls, BECAUSE, THAT is where the GOLD is available!
<;-)

http://today.reuters.co.uk/news/articlenews.aspx?type=oddlyEnoughNews&storyID=2006-08-16T141428Z_01_L16552433_RTRIDST_0_OUKOE-UK-LIFE-COCKTAIL.XMLDUBLIN (Reuters) - Ireland's most expensive cocktail has gone on sale at a Dublin hotel -- priced at a sobering 500 euros.

The "Minted" cocktail -- a vanilla and chocolate Martini on sale at the Mint Bar in central Dublin's Westin Hotel -- includes vanilla-infused vodka, 200-year-old cognac and flakes of 23-carat gold...

The pricey tipple, the equivalent of a month's groceries for an Irish family of four, joins a growing league of extravagant global cocktails -- with some bars now even popping a diamond ring into glasses...

^---(from url)---^

"...joins a growing league of extravagant global cocktails..."

A GLOBAL phenomenon that sees so much money to burn surely tells you as authoritatively as anything can that gold is underpriced.

By way of comparison, the spot price for one ounce of gold is currently only 490 euro.

With an ounce of gold, the buyer gets the best of both worlds -- he can make a showy display of his purchase (since that seems to be the objective with the cocktail), PLUS, the gold will retain the value and thus he'll still have something to show for his effort the next day... better than a hangover!

R.

http://www.ft.com/cms/s/f6404696-2d0f-11db-851d-0000779e2340.htmlNickel Spikes on Panic Short Covering
By Chris Flood
Published: August 16 2006 11:19 | Last updated: August 16 2006 17:54
Nickel continued to dominate action in commodities on Wednesday as the cash price of the metal spiked to $35,000 a tonne.
Dealers reported panic short covering - the third Wednesday of the month and the most important day for open interest. The �TOM/next� premium allowing short positions to roll over one day surged to $1,000 a tonne from about $100 just weeks ago.
Although London Metal Exchange nickel inventories rose 354 tonnes to 6,162, tonnes cancelled warrants - metal already earmarked for delivery - rose to 77.7 per cent of LME stocks. The supply situation is extremely tight as global inventories have shrunk to less than one day's worth of world consumption. Three-month nickel rose 6.4 per cent to a record $29,200 tonne."
LOL, what were these boys THINKING?
Apparently not safety, let alone room to breathe.
Gold. Get you some!

http://www.marketwatch.com/News/Story/Story.aspx?guid=%7B1B513181%2D72E4%2D49AB%2DBC9B%2D2194A67B7A48%7D&dist=rss&siteid=mktwdist%3Drss&siteid=mktwWASHINGTON (MarketWatch) - The economy and interest rate policy are at a crossroad and any Fed watcher who is certain about which road they will take should be taken with a grain of salt, said Dallas Fed president Richard Fisher on Wednesday.

The U.S. economy is downshifting, but there is also a definite increase in inflation momentum, he said.

Although the Fed expects that the lagged effects of past 17 rate hikes, and tightening by other central banks around the globe, may "tamp down" inflation pressure, "nobody knows with precision how the dynamics of the global economy affect these lags or the practicability of our policies.

At least I don't," Fisher said.

"If anybody tells you with absolute conviction that the Fed is done raising interest rates or with equal conviction that they have only paused and will raise rates more starting in September or October, remind yourself that at best - and I'm being generous here - they are only guessing," Fisher said in a luncheon speech to a real estate trade group in Dallas.

^---(from url)---^

Fisher also said the U.S. economy is slowing because of the combined housing cool-down and rising energy costs, but went on to assure the audience:

''From my vantage point ... a recession is not visible on the horizon.'' Period.

Amen.

From my vantange point... 'We shall have the hyperinflation.'

It is chiselled in stone on the job description for central bankers to talk tough on inflation, but it remains a "best-kept secret" that the job position also comes with, effectively, a blood-oath to invoke every power known to mankind as necessary to prevent deflation.

To be sure, national economic recession can happen if measured in REAL terms (i.e., in inflation-adjusted currency units), but not in unadjusted NOMINAL terms wherein the measuring unit (i.e., the currency's purchasing power) for the nation's economy can be so easily made shorter the ensure the appearance of economic growth.

Standing at a "crossroads", a central banker will always lean toward erring in the direction of inflation.

With this in mind, choose gold as the form of your savings to preserve your purchasing power through time.

R.

http://www.bloomberg.com/apps/news?pid=20601087&sid=aw3GiycWPkY4&refer=top_world_newsNickel Soars, Prompting Metal Exchange to Impose Trading Limits | Bloomberg | 08/16/06
Snippit: "Holders of short positions, or bets that prices will fall, can borrow nickel at no more than $300 a ton each day, the LME said in the statement. The move limits the so-called ``backwardation,'' or premium of cash over futures prices."
I was told to "watch closely how the paper games play out, this is the dry run for gold and silver when the shove comes ...."

http://www.ft.com/cms/s/599a7fe8-2894-11db-a2c1-0000779e2340.html(FT) -- Alan Garc'a, Peru's new president, is treading more lightly in his relations with natural resources companies operating in the country than his colleagues in neighbouring Bolivia and Ecuador.

Despite campaign pledges to impose a windfall profits tax on mining firms and reduce prices of natural gas-based fuels, Mr Garcia's administration is instead asking them for a voluntary contribution towards social projects.

"We are doing this in a friendly environment. It's not a confrontation. It's not a negotiation with pistols on the table," Prime Minister Jorge del Castillo said on August 1.

In Bolivia, by contrast, President Evo Morales is [trying] to move ahead with plans to nationalise the country's gas reserves. And in Ecuador, oil sector investment has slowed after Congress approved changes to the Hydrocarbons Law in March that will oblige foreign oil firms to hand over 60 per cent of excess earnings to the government.

..."The government clearly understands that changing the rules will affect investment and wants to avoid this," Carlos del Solar, president of the National Mining, Petroleum and Energy Society, told the Financial Times.

He said, however, that it will not be easy for the mining companies in the SNMPE, about 30 in all, to come up with a formula with which they can all be happy for making their voluntary contribution.

"Part of the environmental conflicts [with mining companies], have to do with the fact that the people feel that natural resources are being extracted and that not everyone is benefiting from this wealth," said Marco Arana, a Jesuit priest who runs Grufides, an non-governmental organisation in Cajamarca, home to Latin America's largest gold producer Minera Yanacocha.

^---(from url)---^

Bear that last paragraph in mind and think on this. Knowing human nature to be what it is, imagine what the social consquences will be when the residual financial fetters are finally cast off of the market's price-discovery mechanism to reveal gold's fair valuation as scarce physical property (instead of the current situation in which it is treated (and priced) as though it were an inexhaustible financial (paper) creation).

Imagine, with that last paragraph in mind, what would happen if it were suddenly a reality that gold had market value (purchasing power) which was 20 times greater than currently perceived by the public at large.

How many of the current mining operations in all of the countries of the world would be allowed to continue with business-as-usual?

How many would be nationalized, or effectively so (through taxation), as people, collectively, seize for themselves what they deem to be a "fair share" of this newfound sovereign wealth?

At such time as high-value gold arrives, do you want to be a sitting duck -- a highly public mining shareholder; or would you rather be a very private gold owner enjoying the sole power to arrange the disposition of your metal according to your own desires?

R.

http://www.ft.com/cms/s/308b81da-2d42-11db-851d-0000779e2340.html(FT) August 16 2006 -- Bankers traditionally face firing squads in times of revolution. But in Venezuela, they are having a party.

Dir�n Sarkissi�n, president of the local subsidiary of Stanford Bank, a US bank with offshore operations based on the Caribbean island of Antigua, is proud of his rapidly lengthening list of high-net-worth customers who are enjoying President Hugo Ch�vez's self-styled "Bolivarian Revolution".

Venezuela's abundance of usually limitless "black" credit cards would seem to sit uncomfortably with Mr Ch�vez's fiery, anti-capitalist rhetoric and his occasional threats to jail bankers.

"We have to transform the structures of capitalism," he said in a recent speech peppered with quotes from rebel icon Che Guevara.

But so far, rather than nationalise banks, the "revolutionary" distribution of oil money has spawned wealthy individuals who are increasingly making Caracas a magnet for Swiss and other international bankers. And it is not just private bankers who are banking on the revolution.

Francisco Faraco, a banking consultant, says local commercial banks are enjoying their most profitable times ever under Mr Ch�vez: "Venezuelan banks have not seen a contraction during a single quarter since 2003."

In 2002, when oil prices were low and the economy was in deep recession, the Ch�vez administration issued billions of dollars� worth of high-yielding domestic debt that was lapped up by the banks. Double-digit interest rate margins left the country's banks among the most profitable in Latin America.

But as oil prices have since soared, government spending has risen by 70 per cent and the economy has grown rapidly � by 17.9 per cent in 2004 and 9.3 per cent last year. Spending and exchange controls have led to a big expansion of liquidity and stoked demand for credit.

...Franklin Santarelli, a director of Fitch Ratings in New York, which last month downgraded several Venezuelan banks, says the profitability of Venezuelan financial institutions could decline for another reason.

"The main risk that is embedded in the negative outlook for Venezuelan banks is related to the possibility of more government intervention," he says.

If Mr Ch�vez's practice of "21st century socialism" begins to match his rhetoric, Mr Faraco says, the party will be over for the bankers.

"In a socialist economy you assign resources as a result of the will of who governs, but in a capitalist economy resources are assigned as a result of risk analysis," he says. "They are two completely incompatible criteria."

^---(from url)---^

Life's a party for the minority "haves" until the majority "have nots" wield the power of numbers.

Good context for an improved understanding of "utility" within the grand scheme of things.

How vulnerable are your personal "resources" to either the adversities of being overprinted or of being "reassigned" by intrusive social forces?

R.

http://www.atimes.com/atimes/others/Henry.htmlHenry C K Liu is always informative, (sometimes overly so) and always quotable�. worth a read imo.

Snippets:

Dollar hegemony depends on the US dollar being fully fungible, ie, able to buy anything in the market without conditionality. And the nature of dollar hegemony is that while the US and only the US can print dollars at will, many of the dollars in circulation are no longer held only by US citizens but by others, including would-be terrorists and their supporters

Democracy became a de facto conceptual victim of World War II geopolitics that spilled over to the ensuing Cold War and the globalization aftermath.

Lasting peace is never the result of victory in war; it is the result of victory over war.

Ten Bears:
Dangerous times call for prudent investments, gold is high on that list.

http://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=1330568
Anyone wish to conjecture on why the silver ETF, on August 14, 2006, would have to file a notification of inability to timely file form 10-Q or 10-QSB with the SEC? I think this is their first reporting period.

Their reason stated is: "The report cannot be filed due to the temporary unavailability of the officer of the Sponsor performing, with respect to the registrant, functions similar to those of a principal executive officer."

What does that mean?

See link.

Although I have always felt that the ETFs represent the next best thing to holding physical gold and silver (especially for those unwilling or unable), they are just that, the next best thing. PG and PS in hand is and always will be the most prized form of ownership.

Noble1

Answering my own question.

Either their numbers aren't adding up or they need to resolve a "material event" before reporting.

Noble1

As a financial tool for those who, for reasons I'll leave unsaid, find it desirable to do the things they do, the biggest convenience the ETFs offer is the ability to conjure up a short position to feed into speculative demand with the relative safety that they don't have to face any risk of potential difficulties in making delivery of scarce metallic product because by the nature of it they are short shares, not metal.

Certain parties with vested interests in preventing a runaway precious metals market for this reason LOVE the ETF... a custom-made tool to hoodwink the unwashed masses.

Amen.

R.

http://stockcharts.com/h-sc/ui?s=$GOLD:$SILVER&p=D&st=1990-01-01&en=2006-12-23&id=p44105871339You've gotta L O V E the look of Silver here as we crawl toward the penultimate delivery window for '06.
She's been whittling away on the Au/Ag ratio all year and one gets the feeling it's Game-On from hereon out.

http://www.usagold.com/DailyQuotes.html
The Daily Gold Market Report has beenupdated.

If you are considering investments in gold we invite you to request our freeintroductory information packet detailing the products and services offeredby USAGOLD ~ Centennial Precious Metals. We welcome your inquiry and lookforward to working with you.

WEDNESDAY Market Excerpts

Gold up, dollar down on sidelined Fed

August 16 (from MarketWatch) -- Gold futures closed higher Wednesday for the first time in five sessions as softer-than-expected consumer inflation data dulled expectations that the Federal Reserve will raise interest rates again and put pressure on the U.S. dollar.

Following the news, the dollar tapped an almost one-week low versus the euro and moved lower against other major currencies.

Gold is viewed by many as a hedge against inflation, and weakness in the dollar tends to fuel investment demand for the precious metal.

Against this backdrop, gold for December delivery closed up $6.10 at $639 an ounce on the New York Mercantile Exchange.

The contract lost more than $29 in the last four sessions as traders moved to unwind the terror premium built into prices during the conflict between Israel and the Lebanese Hezbollah group.

Peter Grandich, editor of The Grandich Letter, said that on a technical basis, gold is setting up for a large rally, after a medium- to long-term bottom that should be set in the next few days to couple of weeks.

"Personally, I would love to see a washout under $600 but markets rarely provide you the ultimate best scenario," he said.

"Whether or not this occurs, the most important belief of mine is not only that are we going to take out the highs of earlier this year around $735, but it's only a question of when, not if, we make new all-time highs in 2007."

Grandich cited a range of factors to support his bullish outlook, including a "constructive" supply versus demand scenario with mining supply currently below expectations while demand remains high.

"While there will be a lull at times, serious geopolitical concerns in the world should give gold a strong underpinning for the foreseeable future. It's clear that the U.S. dollar is no longer the sole go-to place for safe-haven investing."

---(see url for full news, 24-hr newswire)---

C'mon Randy. Be real. Your intelligence and ability to articulate has always astounded me. I always have to read your posts ten times, just like Greenspan, to begin to interpret your meaning. That is a compliment by the way. I am no match to debate you. My guess is you are an attorney.


At least the ETFs must hold their metal (big if, if performing as designed) in allocated and audited storage. And yes, they do hold physical metal(lots of phyical). Of course, we all understand that allocated storage is not subject to physical shorting. An entity shorting an ETF is shorting shares, as you state, not the metal itself. Just as those those buying--own shares--not metal. But from what I understand, for every share (basket issued)---there must be physical backing it. Shares that are shorted do not result in the sale of physical---As opposed to redemption of shares. In the future, lets explore how this could affect the physical price discovery mechanism. Do you honestly feel that shorting ETF shares would drive the physical market? Maybe so, please explain how?

Also, wouldn't you consider it a "big convenience" for the average individual with an IRA, or a pension fund without the ability to invest in physical, to participate in the gold market via an ETF. The hundreds of tons that have been taken off the derivatives market since the introduction of the ETFs has (in my opinion) had a tremendous (favourable) impact on the price of the physical market.

Granted, self directed IRAs can be set up to invest in gold. But, you still don't get to take possession of your metal. You can't directly deposit metal that you currently own. You must rely on a custodian to hold your metal. I'll bet you can't ask for delivery of that metal. I'll bet you have to liquidate in USD. Think about the setup and maintainace fees. ETFs do have their place. Don't cook the goose that lays the golden egg.

Again, I reiterate, PG and PS represent the most desirable and ultimate form of precious metal ownership, but lets not be so intolerant to appreciate other closely allied products that may be the only alternative for some investors.

Noble1

http://www.ex.ac.uk/~RDavies/arian/origins.htmlNO MORE WARS...so then what??

I was reading in the http://www.usagold.com/halloffame.html and found some very informative reading. One write up in particular really started me thinking... Aristotle (6/30/99) The Five Part Series on Gold, Oil, and Money in the Free Market.

If Gold has been and will be considered MONEY.....how can we exchange it for fiat when it becomes $2,000.00 an ounce? Or do we just issue notes like the bank? The few articles are good and I am still pondering on the idea that gold...is wealth and MONEY!

Accustomed to the typical absence, I'm usually pleased with any feedback at all, and so I'll thank you all the more for this and the additional compliment. Thank you.

Among the lot of gold advocates who do double duty as intrepid proponents of the ETF, I think that they, for the most part, have rushed in on a whim and have not critically absorbed the requisite breadth of details to fairly assess the situation in any degree approaching totality.

And who could blame them? Unless you are a person predisposed to this line of investigation and thought, it is sure to be put aside as an insufferably dry task.

While I won't pretend that this post can serve as surrogate for that intimate process, I will at the very least try to offer some key highlights to help fuel any eager adventurers along on their difficult journey.

To begin at the most natural beginning point in this abbreviated session of shared cognition, it serves us well to scrutinize that point you have made in common with many others as if it were the most glorious characteristic offered by the ETF -- namely, the notion that it possibly serves as the only avenue of "physical" gold investment available for participation by some individuals and funds.

Lord A'mighty, it's a miracle!! Thanks to the ETF, or so this line of reasoning would have us believe, a great deal of physical metal has been "taken off the market" by these otherwise palsied investors. Supposedly, this shabbiest of thinking informs us, were it not for the avenue of the ETF we are to believe that all of this pent-up investment desire for gold would just evaporate in the face of the old roadblocks (i.e., lack of ETF avenue), and apparently all of the metal not consequently so absorbed by the very presence of the ETF would alternatively flood the market and suppress the price/value due to lack of buyers.

If not fatuous in totality, it certainly is in large part.

Or, to see this same thing from the reverse angle, consider the goldless investor who finds himself newly with a desire for diversification into gold. If the avenue of the ETF allows him to divert a fraction of his pension funds into the ETF shares, there is indeed a great likelihood that he will then consider that itch suffiently scratched. That is, he will consider that he has now all the gold he needs, the matter closed, and he will not pursue the idea of gold ownership any further -- not to a more tangible conclusion following a committed pursuit of personal gold ownership of coins and bullion.

There is no telling if -- nor does it really matter(!) -- if the shares of the ETF he has naively purchased were among "original" shares created upon the transfer of actual gold into the Trust's allocated account, or if the shares are among the less viscerally satisfying -- that is, those that have been artificially, yet effectively, created above and beyond the gold-backed shares via the stock market brokers' traditional borrowing and shorting facilities.

If a reader doesn't understand that very fine point of share expansion, I'm afraid that they have much homework to do. However, the important thing to grasp is that shares above and beyond the naively anticipated "gold-backing" can be brought into existance to appease gold appetites, thus helping to ensure that it does not pursue metal any further through traditional physical avenues.

In other words, the ETF, through original shares and borrowed/short shares, can help bullion bankers expand a given supply of physical gold into a means to provide the very real (yet deceptive) appearance/effect of fulfilling (falsely) the desires of more investors than would otherwise be the case.

To my mind, on the basis of mere morality and beyond, it would be better to strip away this charade completely, even if it means that it undoes the ETFs primary benefit thus causing some unspecified body of investors to be inconvenienced to seek recourse to the more traditional gold investment avenues to attain their desired level of diversification.

it seems to me that consequently, barring the ETF, the gold it presently holds in trust would become well spoken for -- perhaps several times over.

Speaking of which, it would serve our purpose well to briefly speak on the disposition of this gold in the first place. Ill-informed ETF proponents like to claim that the ETF managers must acquire ever more gold as people buy ETF shares. Not so. Once a supply of original shares has been created (in conjunction with metal allocation), it is simply these shares that trade back and forth, further supplemented, as I stated earlier, by quantities borrowed short.

New "full-bodied" shares with "gold backing" are created only at the pleasure of the Authorized Participants -- that being the bullion banks who retain the unique authority to create or redeem shares with gold deposits or withdrawals from the Trust's allocated account. And on this very fine point a person must strive against the impossibly difficult task of understanding that the quantity of metal so entrusted (for share creation) need not itself present a squeeze upon the open metal market in the course of its commitment. Why? Because this metal may already reside in the Authorized Participant's possesion, or it may be gently borrowed from unallocated accounts from a peer, or a combination of both, and more.

How long does it take, with fancy paper maneuvers, for a bullion bank to whether a speculative storm? I should venture the seasoned guess that a vested interest (such as a bullion bank) has more staying power than the ill-informed and ill-equiped masses who simply pursue the shifting scents of potential monetary gain with a sense of greed and attention that is no more focused than a puppy amongst a flock of butterflies and scattered candies.

And on that note of easily-distracted investor psyche, this seems like the perfect opportunity to spare myself some typing for a change and introduce you to some comments own near and dear Mike Kosares recently offered in an e-mail discussion on this very topic. As I have another look for a suitable excerpt from among his comments, I see this one bloc where he actally provides a tidy recapitulation of some of what I've tried to say above, and then gets on to the point at hand regarding the effective bullying of those humble masses of potential gold investors:

MK writes,
"ETF's may have had a postitve impact on the gold price in that a whole new market has opened up for the physical metal -- a market that might have otherwise gone untapped -- but this fact is a separate consideration from the shorting aspect. In fact the ability to short might nullify the physical offtake. On top of that those wondering about the effect of ETFs on the overall market shouldn't turn a blind eye to the volatility fund traders (the prinicple and intended market for ETFs) bring to the market. That volatility is already manifest in the market and could become a greater influence as volume increases. Let's not forget that in many instances the typical fund trader is in the precious metals market for short-term cash profit, not long-term asset preservation like the average upper-middle- and middle- class investor."

Noble1, you also got into the tangent of IRAs, and for the most part your suppositions on gold deposit and withdrawal from a trust company's fiduciary account are terribly erroneous. This post has become overly long and I'll leave elucidation on that score to another day, but in the meanwhile you would strike nearer the truth of the matter to take the opposite of what you said in your second-to-last paragraph, and would be better served hearing what George Cooper, not I, could testify on that particular matter.

Best regards,
Randy

As you read further into the Hall, you will discovery that Aristotle famously recanted. Or as memory serves me on the gist of it, he took great wind to explain the root of the problem is that gold had indeed been USED as money (or said more properly, as a currency of a bullion-based monetary-esque system), and it was nothing other than this very monetary usage that resulted in the obfuscation of gold's value. Acting with FOA they demonstrated a higher inherent value simply as scarce property, to be best employed as a reserve asset residing outside of monetary attachments.

Very heady stuff, and very much worth the effort.

R.

August Buyers' Group

South American Gold!
Six Countries. Twenty coins.

Call and Save
1-800-869-5115 (Ext. 100)

http://www.chinadaily.com.cn/china/2006-08/17/content_666707.htmSNIPS
Venezuela plans to increase its oil sales to China by 50,000 barrels a day by the end of the year, the country's oil minister said.
+
Though the United States remains the No. 1 buyer of Venezuelan crude, Chavez's government has sought to sell increasing amounts to a variety of other countries in recent years.

==

"Though the United States remains the No. 1 buyer of Venezuelan crude �"
Let's hope for the former that this lasts.
Venezuela does have unlimited supply, does it not?

USAGOLD Daily Market Report (8/16/06; 16:26:25MT - usagold.com msg#: 146675)
Page Update!
http://www.usagold.com/DailyQuotes.html
gold for December delivery closed up $6.10 at $639 an ounce on the New York Mercantile Exchange.
The contract lost more than $29 in the last four sessions as traders moved to unwind the terror premium built into prices during the conflict between Israel and the Lebanese Hezbollah group.

http://news.bbc.co.uk/go/pr/fr/-/1/hi/world/middle_east/4800949.stm
Lebanon army starts to move south
Lebanese troops have crossed the strategic Litani river to take up positions as Israel's army pulls back.
France has confirmed it is ready to command an expanded international force working along with the Lebanese army, but only under certain conditions.
Israel has already passed control of some of its positions in the south to the current United Nations force there.
It indicated that a full withdrawal from what was a stronghold of Hezbollah could take weeks or even months.
+
Israeli Foreign Minister Tzipi Livni said: "If it takes time until the international forces are organised, it takes time until Israel withdraws. THIS IS THE EQUATION."
+
French Defence Minister Michele Alliot-Marie has confirmed that France is ready to lead an expanded UN force in Lebanon but only with a clear mandate and sufficient resources.
It seems that these have yet to be finalised, our correspondent says.

==
TRANSLATION:
Madam Livni is arrogating herself (c.q. the Israeli Defense Forces) the (offensive) right to continue "cleaning" South-Lebanon from Hezbollah.
She's not even hiding her words.
Madame Alliot and the BBC confirm that the UN will never come.
And gold would unwind the terror premium?

http://www.indybay.org/newsitems/2006/08/16/18297892.php
The "real issue" that is being ignored is the systematic destruction of any prospects for a viable Palestinian existence as Israel annexes valuable land and major resources (water particularly), leaving the shrinking territories assigned to Palestinians as unviable cantons, largely separated from one another and from whatever little bit of Jerusalem is to be left to Palestinians, and completely imprisoned as Israel takes over the Jordan valley (and of course controls air space, etc.). This program of "hitkansut," cynically disguised as "withdrawal," is of course completely illegal, in violation of Security Council resolutions and the unanimous decision of the World Court (including the dissenting statement of US Justice Buergenthal). If it is implemented as planned, it spells the end of the very broad international consensus on a two-state settlement that the US and Israel have unilaterally blocked for 30 years matters that are so well documented that I do not have to review them here.

http://www.ocregister.com/ocregister/opinion/atoz/article_1240865.php
So, for the time being, this amateur will hold to the belief that there is indeed some kind of irrational anti-Israeli sentiment afoot around the globe and that it is Israel that holds the moral high ground in at least this current conflict.

http://www.thetruthseeker.co.uk/print.asp?ID=4957
Transcription of telephone conversation on August 3, 2006
From Israeli Embassy, Washington D.C. Telephone Number (202) 364-5582.
to unidentified individual at AIPAC [American Israel Public Affairs Committee], Washington D.C., Telephone Number (202) 639-5201

SNIP
A. The terrorism card works wonders. We were going to release a statement that Arabs were going to attack an El Al plane on takeoff, with rockets�.

A. Probably leftovers from the CIA businesses in Afghanistan.

A. Let's not get into that now. But this scare would only affect flights to Israel and we don't think it would have any impact on the election.

B. Well then, why not have these attacks aimed at American aircraft? Where would they attack from?

A. Say at the perimeter fence lines at airports. Or better still, why not a plan cooked up to smuggle explosives on board transatlantic flights to or from America? Something clever that will catch the public imagination�.

B. That stupid bomb in the shoe routine?

A. Don't knock it. It worked, didn't it? We can always find some suckers with a bent to this we can fill up with real enthusiasm and then turn them in, complete with plans. They actually believe they are going to paradise and virgins and we have another propaganda coup. Let's give this some effort. You know, a terrified public will not want to change horses in mid stream. So far, the Rove people have a good line: If you're against the Republicans, you're encouraging the evil terrorists sthick.

http://www.wrmea.com/archives/May-June_2006/0605031.html
Pro-Israel PAC Contributions to 2006 Congressional Candidates


http://news.independent.co.uk/world/fisk/article1219457.ec
President Mahmoud Ahmadinejad, who usually talks far more than he thinks, condemned the US for supplying Israel with the weapons it used on Lebanese civilians - perfectly true. But he did not say Hizbollah's missiles come from a new-generation Iranian arsenal that did not even exist during the 1980-88 Iran-Iraq war. While the US will be keen to assess the effectiveness of its weapons - albeit largely used on civilians - no one should doubt that Iran will also be assessing the success of its new Fajr missiles - and their effect on the Israeli army.

http://www.truthseeker.co.uk/
Why of course the people don't want war ... But after all it is the leaders of the country who determine the policy, and it is always a simple matter to drag the people along, whether it is a democracy, or a fascist dictatorship, or a parliament, or a communist dictatorship ...Voice or no voice, the people can always be brought to the bidding of the leaders. That is easy. All you have to do is to tell them they are being attacked, and denounce the pacifists for lack of patriotism and exposing the country to danger."
-Hermann Goering, Nazi leader, at the Nuremberg Trials after World War

http://english.eluniversal.com/2006/08/16/en_eco_art_16A767219.shtml
ARGENTINEAN EX MINISTER VIEWS CH�VEZ AS THREATENING MERCOSUR
Ch�vez is trying to change the agenda of the Common Market of the South (Mercosur). His proposals, we warned, could spoil the integration process of member states.
+
"First of all, a difference must be made between Ch�vez and Venezuela. Obviously, we should welcome Venezuela as a member of Mercosur. The problem is Ch�vez." Reference was made to recent incorporation of Venezuela as full member of the economic bloc, in addition to Argentina, Brazil, Paraguay and Uruguay.
"Ch�vez wants to change the Mercosur agenda in a ludicrous manner. His first proposal when joining the bloc was the establishment of a South American army," he added

http://en.wikipedia.org/wiki/Mercosur
Mercosur or Mercosul (Spanish: Mercado Com�n del Sur, Portuguese: Mercado Comum do Sul, English: Southern Common Market) is a customs union between Brazil, Argentina, Uruguay, Paraguay and Venezuela, founded in 1991 by the Treaty of Asunci--n, which was later amended and updated by the 1994 Treaty of Ouro Preto. Its purpose is to promote free trade and the fluid movement of goods, peoples, and currency

The Invisible Hand: note that Chile is no member

http://www.mexidata.info/id1006.html
Monday, August 14, 2006
AN ALTERNATIVE TO A FAILED MERCOSUR
� In a region where loud voices of integration shout over a reality of failed trade policies, Chile's alternative to access to the Pacific may be a viable solution.
By Sam Logan
SNIPS
Chile sees MercoSur as a hollow institution, one that exists more on paper than not. Matus and other Chilean trade negotiators point out that MercoSur's layer upon layer of disputes is proof that the organizational commitment at an institutional level is just not present.
As an OBSERVER OF MERCOSUR, Chile has likely learned from mistakes made by the custom union's members
+
Chile has signed FTAs (free trade agreements ) with CHINA, SOUTH KOREA AND NEW ZEALAND.

==

The Invisible Hand:

Chile observer of, not at, MercoSur?
What was that again about Iran and Shanghai Cooperation Organization (SCO)?

And Venezuela,
a real MercoSur member says Wikipedia,
the incorporation of Venezuela as full member of MercoSur is however only recent, says El Universal,
to increase oil sales to China, one of the two pillars of the SCO?
The Invisible Hand (8/17/06; 02:26:06MT - usagold.com msg#: 146681)
http://www.chinadaily.com.cn/china/2006-08/17/content_666707.htm

Chile signing its own FTA with China.

Jama,
- Venezuela's membership of MercoSur dates only from July 04, 2006.
- and, surprise, just like Iran at the SCO, so is Chile an observer member of MercoSur, not just a special guest like the great Fidel.

http://english.people.com.cn/200607/22/eng20060722_285537.html
July 22, 2006
Argentina hails Venezuela Mercosur membership
SNIPS
Venezuela has South America's largest petroleum and natural gas reserves. It joined the club on July 4.
+
The Summit's full members are the presidents Nestor Kirchner of Argentina, Tabare Vazquez of Uruguay, Nicanor Duarte of Paraguay, and Hugo Chavez of Venezuela. The presidents of OBSERVER MEMBERS, Evo Morales of Bolivia, and Michelle Bachelet of CHILE, also attended. Cuba's president,

FIDEL CASTRO, attended as a SPECIAL GUEST.

http://news.bbc.co.uk/go/pr/fr/-/1/hi/business/4801237.stmPOWERGEN RAISES ITS ENERGY PRICES
The energy company Powergen has announced its second round of domestic price increases this year.
Its gas prices will go up by 18.4% and its electricity prices by 9.7% from 21 August.
It blamed the latest move on the rising wholesale cost of gas which it said had climbed 87% since the start of 2005.
The latest increases bring Powergen into line with all the other major energy suppliers who have all raised prices for a second time this year.
In March Powergen increased its gas prices by 24.4% and its electricity prices by 18.4%.

==

42.8% price increase for gas in five months

9.7 + 18.4 = 28.1% for electricity in five months.

Rest reassured
- PowerGen (http://www.powergen.co.uk) is not an American corporation
- THERE IS NO INFLATION
- gold, or at least the gold standard, is a barbarous relic

A mere recession and whoops Armageddon will be averted

http://business.timesonline.co.uk/article/0,,8209-2313278,00.html
SNIP
Inflation is already out of the box, in the view of a growing number of economists, shared in some parts of the Fed. The central bank's favoured measure of inflation is the GDP deflator for personal consumption expenditures. If that sounds a bit technical, focus simply on the number. After stripping out the volatile food and energy components, it was running at 2.9 per cent in the second quarter of 2006, approximately unchanged from the 3 per cent rate of the first quarter. This is way too high for the proper comfort of even the most tolerant central banker and the indications are that it will go higher, even as the economy slows.
Since a return to an inflationary mindset is probably the single most alarming thing that worries policymakers, the Fed should, on this view, keep pushing interest rates higher. A recession may well simply be unavoidable.
In the 1990s, Norman Lamont, Britain's most underrated Chancellor, was flayed on the altar of public opinion for saying that rising unemployment was a price "well worth paying" to squeeze inflation out of the system.
It was anathema, of course, but economically gold-plated � and the difficult decisions made at that time helped Britain eventually to enjoy its longest period of sustained growth in the past couple of centuries.
For the Fed, and the world, a recession may be the price that now needs to be paid to avert a longer-term catastrophe.

The Invisible Hand: "gold-plated" was does that mean?

http://www.telegraph.co.uk/news/main.jhtml;jsessionid=LAILK1QMCYIADQFIQMFCFFOAVCBQYIV0?xml=/news/2006/08/17/nterror17.xml
A majority of British people wants the Government to adopt an even more "aggressive" foreign policy to combat international terrorism, according to an opinion poll conducted after the arrests of 24 terrorism suspects last week.However - by a margin of more than five to one - the public wants TONY BLAIR TO SPLIT FROM PRESIDENT GEORGE W Bush and either go it alone in the "war on terror", or work more closely with Europe.

http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2006/08/17/cndebt17.xml
GOVERNMENT MOVES TO TACKLE DEBT MOUNTAIN
The Government is to help tackle Britain's �1,200bn consumer debt mountain, with plans to fund more free advice and improve consumers' financial knowledge.

http://news.independent.co.uk/business/news/article1219856.ece
NOW POWERGEN HIKES ENERGY BILLS
The German-owned supplier blamed an 87 per cent increase in the cost of buying wholesale energy to sell on to its customers in the UK since the beginning of last year.

EIGHTY SEVEN PERCENT

http://www.nytimes.com/2006/08/17/world/middleeast/17military.html?hp&ex=1155873600&en=4d76e5064c0f3ee8&ei=5094∂ner=homepage
WASHINGTON, Aug. 16 � The number of roadside bombs planted in Iraq rose in July to the highest monthly total of the war, offering more evidence that the anti-American insurgency has continued to strengthen despite the killing of the terrorist leader Abu Musab al-Zarqawi

http://www.chron.com/disp/story.mpl/ap/fn/4123060.html
BRUSSELS, Belgium � Inflation in the 12 nations that use the euro fell to 2.4 percent in July, the EU statistics agency Eurostat said Thursday, revising downwards an earlier forecast of 2.5 percent for the month.
+
Inflation is still well above the ECB guideline of just under 2 percent and the bank is expected to hike its key lending rate beyond the current 3 percent by year's end.
Eurostat said high prices at the gas pump and the cost of natural gas for heating were the largest factors pushing up inflation over the year, while lower prices for telecoms and clothes had a lesser, calming effect.
The EU expects high oil prices will likely continue to trigger higher consumer prices in 2007. Inflation has been driven up by oil prices as well as increases in the services sector.

http://www.kommersant.com/page.asp?id=697961IRAN, ISRAEL EXCHANGE VIRTUAL BLOWS
SNIP
In a virtual attack on Iran, Israeli hackers broke Tuesday the www.ahmadinejad.ir diary of Iranian President Mahmood Ahmadinejad. The web-site didn't operate nearly for the whole day, as Iran fixed the bugs only closer to the evening

Although it appears to be at support now, the charts are not looking to kindly to the once reserve currency. Many indicators are showing bearish divergences. The same patterns were seen in March of this year when the USD started it's fall from .90 to .84.
This of course bodes well for gold as we also enter a period of seasonal strength in the metal.

http://service.spiegel.de/cache/international/spiegel/0,1518,431793,00.htmlSNIPS
There's no doubt that this administration has made a radical and unpressured departure from the basic policies of all previous administrations including those of both Republican and Democratic presidents.
+
I don't think that Israel has any legal or moral justification for their massive bombing of the entire nation of Lebanon. What happened is that Israel is holding almost 10,000 prisoners, so when the militants in Lebanon or in Gaza take one or two soldiers, Israel looks upon this as a justification for an attack on the civilian population of Lebanon and Gaza. I do not think that's justified, no.
+
I think that at this moment the United States and Israel probably stand more alone than our country has in generations.

==

To repeat
The Invisible Hand (8/17/06; 03:40:34MT - usagold.com msg#: 146682)
The equation
Madam Livni is arrogating herself (c.q. the Israeli Defense Forces) the (offensive) right to continue "cleaning" South-Lebanon from Hezbollah.
She's not even hiding her words.
Madame Alliot and the BBC confirm that the UN will never come.
And gold would unwind the terror premium?

Randy,

"There is no telling if -- nor does it really matter(!) -- if the shares of the ETF he has naively purchased were among "original" shares created upon the transfer of actual gold into the Trust's allocated account, or if the shares are among the less viscerally satisfying -- that is, those that have been artificially, yet effectively, created above and beyond the gold-backed shares via the stock market brokers' traditional borrowing and shorting facilities."

Thank you. Light bulb goes on in my head.

Noble1

on the web. Not anymore.
After reading the filth in message #146682, I wouldn't recommend this site to anyone now.
Randy, I ask that you purge my handle and any information you have on me, from your files. Thanks, goldquest

Please, I can't speak for others here, but I sure get tired of the war & politics crap. We all know you're a very well read and intelligent guy but some of this stuff holds no interest for many. We come here for "GOLD" commentaries. You've given alot in the way of Gold info over the years, can't we get back to that?

We have made numerous attempts -- posted countless requests -- to keep this forum from going political. There is a constant struggle here between the individuals who want to force the posting to circle (always) back to gold and economic themes, and those who want to talk politics. Frankly, the two are intertwined and cannot be separated at some level. Obviously, this opens the door to those who exploit this forum for their own political purposes. I don't know precisely what it is about the post you mention that you find any more offensive than a couple dozen or so other posts over the last several days of the same general content. Where it differs, I'm at a loss to conjure. I can say though that we are as exasperated as you and not with just a single poster but the direction here.

I can say this however. It is my opinion and has been for a very long time that the quality of posting on the internet in general has declined. At some locations, it has declined disastrously. Kitco, for example, the first quality forum on gold, has closed down its precious metals forum and is in the process of revamping its approach. I wish my old friend, Bart Kitner, well in this endeavor, but I don't hold out much hope that the typical problems which visit a forum will be resolved by his request for volunteer forum marshalls. That, in itself, is likely to become as political as the posting he hopes to direct toward productive ends. We have avoided many of the problems that submerged other discussion groups by posting rules and insisting that they be observed. In that we have stood out and reaped the rewards.

At USAGOLD, we have seen a migration of sorts over the last couple of years. Our Daily Market Report consistently outdraws the Forum. Previously the Forum greatly outdrew the DMR. Why did this happen? That's a question each and every participant and lurker needs to consider (if you value this forum). Some of our content and update pages receive much stronger participation than we ever anticipated. At the same time the Forum continues to draw a large following on a daily basis though growth has slowed down considerably.

All traffic at USAGOLD has been on a consistent uptrend since day one of this website to the current position of one of the lead gold sties in the world -- a remarkable achievement in itself. I can tell you for certain that large numbers of those with an interest in gold and all it encompasses come to these pages -- including the forum. For example, whenever I post an invitation to join the USAGOLD NewsGroup, we get substantial response. We had nearly fifty new sign-ups from the post I made two days ago thus far and they are still coming in.

Here is what I have to say about the whole situation:

This forum will be what we make it. Those who complain about the content here (either on these pages or privately [I am not directing this at goldquest who posts here regularly and has earned the right to voice a complaint] and then fail to post something of value themselves simply want others to improve this forum without having to put a little effort in themselves. I don't know exactly how many people have registered to post, but I would not be surprised to learn it's in the area of 9,000 to 10,000 by now. I wouldn't be surprised to learn that we have had over 100 registrations already in the month of August. How many of these registrations translate to a post? Not many. I would say 95% who have requested a posting code have never posted and I've always wondered what that is all about. Theories abound and are discussed at the firm ocassionally.

At the same time, our attempts to keep this forum on subject are constantly circumvented and turned back by the posters themselves -- many of whom have their own agendae. We try to weed these out and send them packing, as many of you aleady know.I will repeat again that we have never taken this forum off an experimental basis and reserve the right to close it any time if it no longer suits the aspirations of the firm.

On the positive side, by and large, we have a good group here, and this forum has been a major positive for our clientele, the firm and the general public. Yes, the posting privilege is abused but that quite often is the exception.

Consider this, and I'm speaking to all here: If you, or anyone else doesn't like what they see, the solution is simple: Take the forum in another direction. Do it yourself. You can't expect me to make this a better place for you by myself. I've tried. I can't do it. Randy can't do it by himself. We would very much like to see substantially wider participation and that is why we have the contests, the check in days, etc. The answer isn't to build greater participation or more posts from an ever smaller group, but a general rise in the content level by simply attracting a greater number of posters. You don't have to be Robert Mundell to post here. We can have conversation on several levels of understanding all at the same time. Believe me, I know from my day to day discussions with investors, some of them posters here, that there are all sorts of levels of understanding about gold and its economic, financial AND POLITICAL manifestations.

I know that many of our best clients and deep thinkers out there don't bother to post, but they like coming here to keep up with the news. I would appeal to all of you to contribute something here in order to make this a better forum. If you don't, we may lose it. Not because the firm decides to close it down, but because it becomes so diluted with special interest posting that it no longer holds value for you as a gold owner.

Think about it. The choice is yours.

At the very least I would like to see some opinion on this particularly from lurkers, new visitors, and first time posters, but from our esteemed regular group as well.

I'm on my way to the office and I wanted to just get this up as it was written. If there are typos, left out words, etc. please forgive.

MK

Michael..I think most realize Gold & politics are intertwined and cannot at times be separated, but it's most annoying (I don't complain very often) when the war/political posts become repititious. Over the last 8-9 years (??) that I've been here many soap-boxer's have come and gone. Years ago I used to annoy a few (I'm sure) w/ my GATA soap-box but at least GATA was/is doing a great service for Gold Advocates. The webmaster is still the "Master" w/ the 'Delete' option. It's been used on me a time or two over the years :-)

BTW...Irregardless this "IS STILL" one of the best of the few Gold sites on the web...Regards; Ken Reser

500 euro Irish cocktail on sale
(Reuters)
Updated: 2006-08-16 22:47

DUBLIN - Ireland's most expensive cocktail has gone on sale at a Dublin hotel -- priced at a sobering 500 euros (340 pounds).

The "Minted" cocktail -- a vanilla and chocolate Martini on sale at the Mint Bar in central Dublin's Westin Hotel -- includes vanilla-infused vodka, 200-year-old cognac and flakes of 23-carat gold.

The drink comes in a designer crystal glass with chocolate truffles served on the side.

The pricey tipple, the equivalent of a month's groceries for an Irish family of four, joins a growing league of extravagant global cocktails -- with some bars now even popping a diamond ring into glasses for those really wanting to splash out.

Michael,

Since you asked, what I would find more useful about the group is anything to continue helping me understand what reasons for the movement in the price of gold on any given day might be. I try to keep up with this forum almost daily and often I DO find explanations in people's messages for what they think might be going on in the world to affect the POG. But other times there is a big drop and I come here and no one has said a word about it.

I know you and Randy aren't going to want to have that be your "job" -- you provide the forum, and we're all grateful for that... but perhaps in thinking forward, you could further somehow support newcomers and novices in PM investing by maybe pointing to other news sources with explanations of current events. Members tend to do that on their own, and Randy does it as well in his messages. So there may not be any more you could do than you already are. But I don't think it would hurt your business to allow people to discuss and point to other sites that explain things not already covered at USAGOLD.

Hope this helps a bit... much of the discussion here is over my head (and I suspect that might be the case for those thousands of people you say signed up but never post). So anything to help the unwashed masses better understand the forces behind gold investing will always be good for you guys and all of us!

I can't say that I have ever really had to scrimp and save to eek out my existence over the years, but, nevertheless, I was brought up by parents who insisted that I never waste anything (don't forget that postwar rationing lasted for some items until 1955 in the UK). I don't think that I would use the word "weird" to describe the use, but I sure would to describe the people who order one !

@ Titan. The problem of having to ascribe a reason for every market move is extremely tricky if you try to look for "logical" or plausible reasons - especially current affairs on a given day. This is why most of the business reporters sound so assinine because a) they give the impression that they don't really understand what is going on, and b) their statements are often contradictary from week to week. Therefore the vast majority of posters, ordinary joes that we are, say nothing rather than look foolish. After all, it's better to have no posts at the Forum than ten silly ones.
Today is a case in point. My take ? If you look at the PoG chart from May, there has been a big pennant formation being developed. The point of the pennant is somewhere around the end of this month. Pennants end with a breakout either up or down. Logically, the price should break up, bearing in mind all the other economic factors that we hear about here. However, an entity (or entities) in a serious short squeeze situation may see benefit from "burning" some gold to force it, even a little, below the breakout down line. That would cause some of the trading programs to sell, expecting even lower prices. Will it work ? Well it has in the past, but over the years the effect has been getting less and the recovery swifter. We have seen a number of these "attacks" over the last month. This might be the charm for the shorts, maybe not.
Of course, all the above might be complete drivel :^] and my conscience only allows me to expose myself to ridicule once a month tops. So don't be looking for Trader Clink!'s markety summary tomorrow.

@ MK. Aha ! I like a challenge. I introduced a topic (on 08/05/06, I think) hoping someone might have more info, but no-one took the bait. Time to do my own research .....

C!

... to anyone looking for insight and
perspective on the precious metals, and
so superior to other forums -- editing
for RELEVANCE and compliance with a few
basic rules.

The lack of editing for relevance is why
the Kitco forum long ago lost value, why
the Kitco forum came to require far more
time and effort to scan than it was worth.

The editing hand of our host here has
been very gentle, kind, and indulgent,
but it has been used enough to keep most
of us in line most of the time. If that
hand was more assertive, the forum's
value, immense as it is, might even
increase. But then you can't blame our
host for not wanting to hurt feelings.

I don't know about others, but I don't
come here because I want to hear the
politics of the Middle East argued, as
much as the general fact of conflict
in the Middle East may influence the
gold price and should be acknowledged
for doing so. There are other forums
for arguing that politics.

I do have to admit that the gold education provided through the archives of USAGold is top notch � bar none - and the support provided through this forum is invaluable. If you look closely, you'll most likely find that the posted words are tied to gold and how it forms the framework for just about everything else that we see today. Until I studied the archives thoroughly, I only saw the surface problems. When it really comes down to it, gold provides the bedrock that helps explain many of the workings that make headlines on a daily basis. I am grateful for having found this site and, still, highly recommend it.

One of the key reasons why I've bought into physical gold holding is because it's at the root of both political and financial actions. Even though the sky is falling everyday, the wealth associated with holding gold never changes. It's this personal point of view that reshapes *my* world and gives me hope for the future.

Today, I vote with gold. Currency is a tool to get to gold. Actions are a means to get to currency.

If you understand these words, you will see that gold is making advances in the real world in the dollar's battle against it. The dollar takes force and laws to prop up it's function. Gold stands alone.

If you really think about it, the dollar is falling while staying in the same trading range.

Hold gold in hand and have hope. Then, be a constructive member of society and be the instrument for change.

MK:

Taking up your invitation for more posts on monetary subjects and less on the very perturbing political situation in the world today, here are some thoughts which might be of interest:

1. All money in the world today, is irredeemable money, that is to say, it is FIAT or artificial money."Monopoly" money with a government seal, in other words.

2. All of the money in the world, and specifically in the USA, is of TWO kinds:

a. Tangible money - Federal Reserve notes and coins, and

b. IMAGINARY money.

Tangible fiat money and Imaginary fiat money together, make up M-1. (If you want the definition of M-1, please go to the Federal Reserve site and you will find it there. Briefly, M-1 is Federal Reserve notes, coins, plus demand deposits such as checking accounts, and some other technical stuff.)

M-1 is running at about 1.375 trillion dollars, and the magnitude of the component of Federal Reserve notes plus coins is something of a mystery. The Fed says there is some $700 billion of Fed notes out there, but of these, only about half circulates in the USA. So, let's take $350 billion as the sum for the Fed Notes plus coins component.

That gives us a breakdown of 25% (roughly) for Fed notes and coins (tangible FIAT money) and 75% for - checking accounts and other types of accounts in banks (IMAGINARY FIAT money).

If you, dear Forum reader, think you have "money in your checking account" (and I hope you have some!) then you are really IMAGINING that you have money. For you see, when you deposit a sum of money in your bank, you are really making a loan to the bank.

Now, a loan is really a conceptual thing. You think and believe your deposit (loan) will be repaid when you call for it. The borrower (your bank) thinks and believes it will pay the loan from you, and intends to do so, no doubt. But all of this is in YOUR mind, and in the "mind" of the BANK, or of its officers. It is all conceptual, or, to use a better word, IMAGINARY.

So, the money (M-1) is 75% IMAGINARY FIAT. And, the thing gets even more imaginary as we progress up to M-2, and last of all M-3, which we are not allowed to know any longer - since February of this year. ALL of the additional components added to M-1, to make up M-2 and M-3, are IMAGINARY FIAT. Vast piles of it!

So, that's what the USA is running on. A lot of imagination!

That is what the whole monetary system of the USA - and of every country in the world - is all about: IMAGINATION.

We the sheeple are living in a world of IMAGINARY wealth. That suits the bankers of the world just fine. Because of this terrible fact:

Every penny of money in the USA is the result of a debt incurred by someone - not necessarily yourself, of course - when that someone borrowed from the bank. The bank made the loan and credited a checking account with - IMAGINARY MONEY. The borrower then uses the imaginary money to make a "payment" of imaginary money to someone, for a purchase. And the seller takes the imaginary money, and puts it in HIS checking account, and goes on pays someone else IMAGINARY MONEY. And so it goes.

So the American people - as people all over the world - have to go into DEBT in order to have IMAGINARY MONEY. A banker's dream!

And, IMAGINARY MONEY is money that can disappear as quickly as any dream, which is also imaginary. All it takes is either runaway inflation (quite likely), which destroys the market value of imaginary money, or a severe deflation, which is possible though less likely (perhaps!)where the banks simply cannot pay their debts of imaginary money to depositors - as happened in the Great Depression.

Bottom line: be sure you have some REAL wealth to stand upon, and not either tangible FIAT (bills) or IMAGINARY FIAT (ckecking accounts and everything else that is only an ACCOUNT)

Do not live in a DREAMLAND of IMAGINARY MONEY!

Buy gold at any price.

Thanks for reading!

SIERRA

Gold, commodities, OIL, and politics have become even more intertwined. I think most of us never like to discuss politics and religion under the GOLD umbrella, but how can you actually avoid it?

There are so many variables in this game and that's what causes this to be so volatile.

We have corruption and Hedge Funds and Mining operations that are being seized by governments and more.

To cut out all would be a mistake. To limit some, we may miss out on a point.

All this drama now confirms what I have always felt about the precious metal GOLD......IT'S AN EMOTIONAL METAL and carries lot's of energy!

So is Gold good or Bad?

Are gold bugs Crazy?

I think it's a combination of the two.

Just like the good ole` Gold Rush days!!
They are still searching for the "Lost Dutchman's Gold mine"


Have a Shinny Day. I sure will......

P.S. I know this is a gold discussion group. I can over look things that are not important to me. There maybe one line that might really make me think deeper! I AM ANTI CENSORSHIP!! I am not a cry babe!!
BE TUFF

http://www.rbcnews.com/free/20060817132609.shtmlRussia's gold and currency reserves show highest one-week rise



RBC, 17.08.2006, Moscow 13:26:09.As of August 11, the Central Bank's gold and foreign exchange reserves stood at $277bn, which is $10.1bn, or almost 4 percent above the previous showing as of August 4. This has become the highest one-week rise in Russia's history, fueled by the Bank of Russia buying dollars on a large scale on the home market. On August 10 alone, the Bank could purchase $7bn-9bn at two special sessions on MICEX, traders estimate.

The reserves had been growing for 8 weeks in a row, gaining a total of $31bn, or 12.6 percent over the period. Starting July 21, that is in the previous 20 business days, the reserves surged by over $21bn.

By and large, in a little more than 7 months of 2006 Russia's gold and currency reserves gained nearly $100bn. As a result, Russia, now firmly entrenched in the third place in gold and currency reserves, has narrowed the gap between itself and the world's leaders, China and Japan, with reserves totaling $940bn and $870bn respectively.

The Russkies don't seem to want to break down the reserves into GOLD plus foreign currency reserves.

What's important is the GOLD component.

The rest is - IMAGINARY reserves.

The world reserve currency is - like all others - an IMAGINARY reserve with no reality to it.

The Russians, like all the rest, are relying on what Fisher of the Dallas Fed called "a faith-based currency", in other words, on something IMAGINARY.

Such is our world.

"Dreaming as the Summers die,
Dreaming as the days go by;
Ever drifting down the stream
Lingering in the golden gleam.
Life, what is it but a DREAM?" LEWIS CARROLL.

Tra-la-la...

Earlier there was some talk that the Bundesbank had given the BOF 5 tons of gold to sell over a term. Also, the term idea seems linked to a repo transaction.

The Russian C.B. buying billions of dollars for reserves is not being bright.

Purchase of dollars means they PAY for them with rubles. That means more rubles in circulation, and that is: INFLATION.

The Russkies are inflating their money supply by buying dollars for reserves. IMPORTING INFLATION FROM THE USA.

Not good for their economy.

But all CBs everywhere feel really good about swelling amounts of reserves - while they are pumping more money into their economies.

World inflation is taking place. Won't end well.

buy gold at any price

Taking the f word out helps, but imho, the whole message should have been deleted.

@ Sierra Madre (8/17/06; 12:11:33MT - usagold.com msg#: 146702)

"Do not live in a DREAMLAND of IMAGINARY MONEY!

Buy gold at any price."

Gold at ONE US$ an ounce or ONE HUNDRED US$'s an ounce........isn't it all the same price?.............What is any price if the dollars are IMAGINARY???...................iS NOT GOLD THE CENTRAL MONETARY MEDIUM?..............AMF

http://themoneyblogs.tradingmarkets.com/CT/my.blog/can-metals-go-parabolic.html08/16/2006 --
Our different point of view identifying "A New Bull Market in the Making" was rewarded with some quite sensational upside action in the markets, in what appears to be a pattern of mild pullbacks, bereft of any real selling, followed by strong impulse waves to the upside.

And, thus far we have had a similar pattern in Gold and Silver, although we have yet to see the next strong impulse waves unfold and this has created some worry, which is exactly what we want to see: The Precious and Base Metals also climbing a big wall of worry to sharply higher levels and we're now at an important inflexion point, that could define the metals direction going forward into the end of 2006.

Longer term readers may recall, how in the very early days of the liftoff in Gold a year ago, in a groundbreaking piece of research, we were able to identify a remarkable resemblance in the behavior of Gold over the past 6 years or so, with that of the Dow Jones Industrial Average taking off from its double-bottom formation of 1980 and mid-August 1982, in a stunningly similar pattern of percentage gains and behavior...

...Now the tables appear to be turning, wherein some market indices have remained subdued since 2000, while Gold and Silver have been the place to be, just as the Dow was in the 80's and the major casualty thus far has been the very significant decline to date in the US Dollar and its potential for much worse to come still.

Everything was going perfectly according to this plan in the first 5 months of this year, wherein extrapolating forward, we were able to come up with a potential target of $925 to $1,050 for Gold sometime next year and then perhaps following a pullback or yearlong more period of consolidation, we might actually see a run to as high as $1,785 by 2009 with a possible run to as high as $3,790 by 2019, which curiously is about equal to the Dow hitting 10,000 at the turn of the Century. So don't say it can't happen. If a stodgy old Dow can do it, so can Gold.

So, the ducks were almost perfectly lined up, so to speak... Until the markets got too giddy back in May and suffered a short, sharp and to some, a devastating correction, the most interesting part of which is: Being that both the Gold and Silver charts are a microcosm of the old Dow's behavior back in the early to mid-1980's: Was May through June, Gold and Silver's version of the crash of ' 87...? .... Remember the intense level of bearishness following the '87 Market Meltdown, there wasn't a bull in the World and as for anyone predicting the Dow was headed for 10,000, would have been locked up for his own protection...

What is intriguing thus far is the juxtaposition of Gold and Silver at this time. We've maintained all along that the power of the trend is the one thing that has kept us bullish on Gold and Silver. The trend was so strong, it overshot and self-corrected. But now that correction may be long over, or its end may be near, because even if more consolidation is likely, the sheer size and dimension of the unfolding ranges is likely to portend Gold and Silver prices substantially higher in due time and lest we forget, we broke out of a 25 year base which has been building up an enormous amount of energy and portends Gold and Silver prices extremely sharply higher in the years ahead and right now we're right at this inflexion point, where one could argue the case that like the Crash of 87' lows rising to new all time highs faster than just about anyone thought possible, so too could the same fate await Silver, Gold, Platinum and Copper.

What is most intriguing about the Gold and Silver moves of the past 6 years or so, are those same telltale macro, mini, minor, major and even mega wave activity, that tells us there really is a monster bull market brewing out there of epic proportions...

...now in the earliest days of a megabull market in Gold, Silver, Precious and Industrial metals, this early in the game, metals like Copper have already moved beyond imagination and before this decade is out, we believe the emulation of the Tech explosion of 1999 ~ 2000, will be in Gold ...

Just as the seismic activity can predict an earthquake ahead of time, the footprints laid by the metals tell us there's a very big one coming.

^---(from url)---^

"If a stodgy old Dow can do it, so can Gold."

Classic.

R.

Nickel made from planchets of 75 % copper and 25 % nickel. At todays prices, what is the value of a nickel?

Cash buyer LME Price /tonne Aug, 16, 2006
Copper $7560
Nickel $33,300

1 tonne = 1000 Kg = 1,000,000 gm

Mass of US Jefferson nickel = 5 gm since 1938

0.75 x 5 gm = 3.75 gm copper
and 0.25 x 5 gm = 1.25 gm nickel
3.75 x $7560/1.0 E+06 = $0.028 or 2.8 cents
1.25 x $33,300/1.0 E+06 = $0.0416 or 4.16 cents
Total 7 cents
For comparison
Susan B. Anthony Dollar 12.5% Nickel balance Copper
8.1 gm
0.875 x 8.1 gm = 7.087 gm copper
and 0.125 x 8.1 gm = 1.0125 gm nickel
7.087 x $7560/1.0 E+06 = $0.0536 or 5.4 cents
1.0125 x $33,300/1.0 E+06 = $0.0337 or 3.37 cents
Total 8.73 cents

I'm on my way to the bank to get some rolls. Do you think they are available?

Well, osa, coupla things about IMAGINARY MONEY. It still takes work (for some people, not for others) to get ahold of IMAGINARY MONEY. (Remember those two execs of GS back in the 90's, who bet $1,000,000 on whether the market would be up or down on the day? Can't be costing too much work to get money, if you can burn it that way.)

So, most of us still have to have it, before thinking of buying gold with it.

And a difference between one dollar and a hundred dollars an ounce, is a BIG difference.

When I say at any price, you are to understand that quibbling about whether to buy today or tomorrow, whether $630 is a good price or $614 today, or $595 tomorrow, that does not make any difference. If you have the wherewithal, any current price is a good price.

You bought at $728? NOT TO WORRY! We shall soon leave that behind, and you will forget what you paid. But you will always be glad you bought. Forget fluctuations. They are meaningless sooner or later.

That's what I mean when I say,

Buy gold at any price.

SIERRA

Not wanting SBA $ at this time.

MK, many blessings to you and your staff for your commitment to this forum and your collective patience with said forum.

I must confess that I am at fault for being one of those who post rarely. Admittedly, in the beginning, it was because the quality of the threads was outstanding. What can a mere mortal offer to the gods? Awe has a side-effect of keeping one humble and quiet. However, as of late, posting seems almost irrelevant. Please let me explain.

Many articulate people post here and have great things to bring to the gold discussion. Yes, a few have moved on and some newer ones have picked up the standard. I have earned at least an Associates degree in economics from the wizened lords and ladies here. Thank you to those who were able to help cure me of my ignorance.

On the other hand, some here post politically under the guise of "all things affect gold". While that may be true, to purely post a political slant and then not attempt to explain its effect on gold is just Another re-hashing of all the garbage on talk radio (we're right � they're wrong, blah, blah, blah). I am not suggesting that politics does not affect the price and movement of gold; it most certainly does. Gold is a very political metal � as pointed out by many illustrious posters here. If we're going to discuss politics, it should be discussing its� effect on gold � such as the lack of response by the gold futures price in the wake of the planned attack on UK to US planes. For example: a terrorist plot to blow up planes is political, but the resulting action in the gold price is what is relevant to this forum. I believe this was (and still can be) the genius of this forum. Another/FOA seemed to have a magic touch when it came to this, though sometimes even they had some "slip showing".

There are far too many brilliant people here to descend into the pig-sty of political mud slinging and flag waving. If you want that, watch CNN or Fox. And if it be that there is no "news" per se regarding gold on a given day, then a quiet day can be observed too.

Thank you, Sir Michael, for your invitation to speak up at the table round.

spikedog

MK,
For many years I visit daily this castle always with great pleasure, as a shrimp I have learned on this precious table that there are so much more angles on the POG in the postings as wel in the the archieves.

In one way or another, most posts are related directly or indirectly to the POG, sometimes the levels of understandings are realy deep to make the interconection to it. Ofcourse the individual examination of the value of the posts is depending on ones subjective interpretation.

We are kneaded by all kind of media to think what they want us to think (trying to push and keep us, inside the ($) box). A closer look at fundamental (real) economics today, seems we are moving fast and far outside this fantasy box. To get a clear view it takes one to think outside the box as well to see what's realy happening today. On this forum post are so informative that they are one helping to think far outside the bounderies of this fantasy box. Finaly to convince one of at least to have a GOLDEN insurance.

Therefore I would thank you and your team for providing this precious table and all posters for their contributions, please keep up the good work and the freedom of speeche���

Just to say that if postings of FOA/A are studied, the (political loaded) postings falls more in place like small puzzle pieces.

Sal-OM all !!
Shanti

http://www.lme.co.uk/dataprices_daily_metal.aspWell, for this I shall just trot out the old "bad money drives good money out of circulation" nugget. How long before the Jefferson Nickels will be replaced with a new design that is not a money loser from the get-go. Perhaps the newly issued nickels of the half-face variety will be a short -lived production run and soon carry a numismatic premium. They have the same apparent weight and dimension of the older nickels so I am presuming they have the same composition. The US Mint website does not give a specification for this issue unless it is in the category of the "Jefferson series".

Money/coinage in circulation appears to need an intrinsic value (the market value of its component metals) much lower than its "coined" (tender?) value for it to continue to remain in circulation as money.

The new Buffalo gold piece has a $50 denomination stamped on it as if it were an afterthought (or perhaps there was an original aim not to place a $ value on it). This obviously means it is not intended to circulate as common money.

The Mexican "Libertad" Silver pieces do not have a "peso value stamped on them. They are liberated coins. Loosely translated, they say 1 ounce of pure silver .999...that is all. The writings of Hugo Salinas-Price may be familiar to some here on the forum with regard to having a freely circulating silver coin for the populous to protect themselves from the profligate monetary policy of the Mexican state (and the international cartel of bankers who manage it...my parenthetical, not attributable to Mr. Salinas-Price).

The extreme and developing shortage of Nickel is behind the advance of the intrinsic value of the US nickel beyond its "tender value".

We now have no actual "gold or silver money" in circulation. Gold coin trades as a "collectable" under the newly reformed US Tax code. this subjects transactions to a 26% profit sharing partnership to the IRS.

Was it a shortage of metal that drove the intrinsic value of gold and silver above its tender value that drove it out of circulation as money? Was it an increase in trust of the US treasury and its new partner the Federal reserve? Or was it, a refusal of congress to exercise at the behest of banking interests to be bound by the discipline of a gold standard?

The US Nickel is just another in a long line of metals that is too valuable to be used by ordinary folk for what passes these days as money. My prediction is that there will be no metallic "money coinage" in the future. Perhaps wampum (colored beads) will suffice.

http://www.usagold.com/DailyQuotes.html
The Daily Gold Market Report has beenupdated.

If you are considering investments in gold we invite you to request our freeintroductory information packet detailing the products and services offeredby USAGOLD ~ Centennial Precious Metals. We welcome your inquiry and lookforward to working with you.

THURSDAY Market Excerpts

Gold down as oil slips again

August 17 (from DowJones) -- The continuing tumble in crude-oil prices took a toll on New York precious metals Thursday, with long liquidation occurring and the loss accelerating in gold when sell stops were hit, traders and analysts said. December gold settled down $13.70 to $625.30 on the New York Mercantile Exchange.

Gold had risen on Wednesday when the market chose to pay more attention to a softer U.S. dollar - which tends to support the metal - rather than a decline in crude oil, which tends to be bearish.

For much of Thursday, the euro traded modestly higher, but crude was on the defensive. And this time, several market watchers said, the metal took its cue from the energy complex, as September crude fell to as low as $70 a barrel, its weakest level since June 21.

The euro then gave up its gains late in the day, adding to gold's woes.

"This is mainly an energy situation," said Scott Meyers, senior trading analyst with Pioneer Futures.

"The energies got clobbered for another day. If you look at the charts, they're very similar. The energy sell-off is starting to spill over to the metals."

This was also cited as the main influence by Mike Zarembski, analyst with XPRESSTRADE, who cited spec selling in particular.

"The sell-off in energy is affecting precious metals despite the weakness in the dollar," he commented.

A couple of dealers also cited thin liquidity during the summer vacation season as a factor contributing to the metals' weakness.

"It's mid-August," said one. "Liquidity dried up some months ago and it's even worse now."

---(see url for full news, 24-hr newswire)---

http://www.forbes.com/business/energy/feeds/ap/2006/08/17/ap2957588.html^---(from url)---^

Whe I saw this headline among the lists I thought this was going to be a retrospective on Nixon in '71.

Oh, well...

R.

the power brokers who make the rules have been having a personal secret/silent run at "CHEAP" Gold for years. Not so different than Martin Armstrong dissing Gold endlessly and shorting to eternity for other people's accounts and all the while holding a few Mill $$ worth (solid Gold bust and mega coins etc) in his penthouse. Anybody who can't believe Greenspan doesn't have mega Gold holdings along with every other scurrilous central banker has their head in the sand. Ever wonder what Gold assets tricky Dick had before he killed the Gold standard?

http://www.coinflation.com/This link might save you a bit of calculation.
C!

http://honestmoneyreport.com/archives/2005/1003.htmlby Douglas V. Gnazzo
Snippets:

Another paradigm shift took place, one that changed from paper money being backed by silver and gold, to the belief that it need not be backed by anything but the promise to pay � as if such would be enough to stem the tide of financial and monetary debasement.

The age of paper fiat blossomed during the twentieth century. Granted it had started much earlier, but the advent of the Federal Reserve in 1913 was the defining moment in the annals of paper fiat money. The Fed and an elastic money supply of paper fiat go hand in hand, like death and taxes

a paradigm shift is taking place, people are beginning to realize that paper fiat debt-money is becoming worth less and less, and is on its way to worthlessness.

Make no mistake about it, change is afoot � the times they are a changing. Align yourself accordingly. Be on the side of Honest Money.

Ten Bears:
One view from a "sound money" gold advocate..

http://www.jsmineset.com/snip:

It is all in the US dollar, however thanks to the COMEX gold-men the vacillation in the price of gold is multiplied by orders of magnitude as compared to the vacillation of the dollar.

The Exchange Stabilization Fund works at the behest of the Secretary of the Treasury and/or President.

Let's assume the primary person operating this fund is the financial man. Then assume the US dollar cannot bomb out when the boss is on TV saving pensioners from living in cardboard boxes.

Who would do the dollar buying?

The answer to this question is some major international investment bank. If you are part of that trading team the tempting transaction is to hammer gold as you buy the dollar, is it not?

The future of gold lies more in the various necklines of the many bearish head and shoulder formations of the US dollar than any other item.

Just look at this relationship today.

My view is gold is going to $1650 and the US dollar has two potential price objectives: .7200 and .5200.

All the rest is noise and drama.

-Goldilox

As a fairly open political poster, I must admit I've also felt things drift further off-topic than even I am comfortable with. It's not about censorship, but rather propriety. Sinclair makes a good point about the relationship of dollar politics and international gold price in the quote above, and that's what makes a good guideline for discussion.

The "fervor" of someone's political stance says NOTHNG about the appropriateness of the topic. If the poster has to work to make it fit, it is probably borderline or downright inappropriate. We have enough that we disagree on WITHIN the guidelines for many hours of discourse, when we so choose.

When posters get either too personal or too political, no matter who they are, it's best to step back and let the smoke clear, as neither "preaching to the choir" nor "voices in the widerness" are particularly interesting to most of us.

My postings are inversely proportional to the amount of political garbage that surfaces almost daily as of late on this forum. I understand, as I'm sure most others here do, that politics and gold are intertwined. However there's a clear problem for me when a post is 90% politically oriented and only tangentially connected to gold with some inane reference to it.

For instance, if I say or suggest that President Bush and his administration did 9/11 should we all buy gold? I could also say that the price and quantity of oil is controlled by administration-backed corporations and we are quietly being led to the slaughter by same. This is crap. Even if it were true (GWB ordered 9/11) I would be more concerned if terrorists did the deed and will strive for a bigger hit. To me, GWB is a misguided/moderately stupid/dishonest politician, not a terrorist.

That the US Government's policies, Middle East and oil are connected to gold is undisputible. What cranks me is the emphasis of some posters to create goblins. It has been spelled out by many that the fight for free gold is a 100 year's war. Day-to-day politics are noise in the process. Don't get distracted. The real enemy is the ignorance of the masses regarding the complicity of the banking and political fraternity to perpetuate the fiat $. Our forum focus should be as GATA has identified, the FED, the USTreasury and the Bankers. These are the puppet masters.

http://www.safehaven.com/showarticle.cfm?id=5266Mortgages and debt money, as opposed to sound money� (For any who may not be familiar with the philosophy of this particular brand of gold advocates.)
Snippets:

On June 5, 1933, Congress passed the House Joint Resolution 192 to suspend the gold standard and the redeemability in gold of paper money. Since that time, it has been impossible to lawfully pay off a debt.

Lastly, by instituting a paper fiat debt-money system, whereby credit and debt and money are one and the same - it is issuing debt obligations that are backed by the credit extended by the acceptance of all mortgages on our homes, and other private property.

http://www.kommersant.com/page.asp?idr=528&id=697281SNIP
The continuing decline of the dollar is forcing many Russian traders to sell the American currency. As a result, Russia's gold currency reserves rose to a new high of $266.9 billion, placing it third in the world, behind CHINA and JAPAN. However, this position is likely to be short-lived, since repaying Russia's debt to the Paris Club of creditor nations will drain $22 billion from the reserve

http://news.bbc.co.uk/go/pr/fr/-/2/hi/asia-pacific/4797903.stm

http://honestmoneyreport.com/archives/2004/122904.htmTHE SCOURGE OF MANKIND
by Douglas V. Gnazzo

PILLAGE & PLUNDER
Snippets:

What is actually occurring within the markets is a form of wealth transference, from the producing sector to the financial sector, taking the capital of the former, and giving it to the latter, creating almost risk-free capital gains in the process.

Deflation and hyperinflation are different in form, but they are identical in substance � two opposite sides of the razor sharp edge of debt. On either side lies the abyss. Deflation destroys the value of debt through defaults and bankruptcies, hyperinflation by debasement and loss of purchasing power.

Hyperinflation destroys the currency; deflation prolongs the

Monks brawl at peace protest.
http://today.reuters.com/news/articlenews.aspx?type=oddlyEnoughNews&storyid=2006-08-17T181046Z_01_COL276316_RTRUKOC_0_US-SRILANKA-MONKS.xml&src=rss&rpc=22
How can you get more bizarre then that? I like the news to show which way a market will go. Brawling monks tells me our collective ship is listing badly but the forces of good and evil are now doing battle. This struggle will tend to pull the markets in a titanic battle. The forces of good, reality and compansion will be fighting the forces of evil, assumption and destruction.
Which side will win will be very much determined by our collective stand on the issues that shape the markets and the price of gold.

It was not that long ago that $20 swings in PoG were pretty big news. One can argue that the current higher "value" means they represent a smaller percentage move, but they seem "normal" as of late, where they previously represented a major price advance or reversal. Is this altered perception merely a product of global price inflation, vis a vis dollar devaluation?

Do we now reserve the term "major" for $30 or $50 moves?

A number of gold pundits have predicted $100 swings in the near future. How near, do forum members think?

I'm interested in individual thoughts on increasing volatility, for those who might wish to comment.

The late Harry Browne's definition of volatility is:
The tendency of an INVESTMENT's price to fluctuate.
The opposite of STABILITY

Next Gold.
Harry Browne, "The Economic Time Bomb", 1989, pp.152-153:

{Gold's] principal function is as a store of value � a role in which it competes with the US dollar.
+
Demand for gold as a store of value dominates the price. Thus gold's response to inflation is much more powerful and reliable than that of commodities whose prices are determined by levels of production and consumption.
+
Gold also has the virtue of being self-sufficient.
+
Gold may also profit from political or military crises that feed anxiety and increase the demand for a store of value.

==

I like it: If gold is now volatile, it proves that it is NOT a stable investment.

This lunatic's posts of earlier today prove, to everyone's disgust, that the present politico-economic situation is such that
- people are looking for a store of value
- there is inflation and gold should thus be responding
- all existing paper currencies are faced with inflation
- Madam Livni is arrogating herself (c.q. the Israeli Defense Forces) the (offensive) right to continue "cleaning" South-Lebanon from Hezbollah. that she's not even hiding her words; that Madame Alliot and the BBC confirm that the UN will never come.; and that other lunatics than this one, are arguing that gold would unwind the terror premium.

This Livni-Alliot thing was quoted in
The Invisible Hand (8/17/06; 03:40:34MT - usagold.com msg#: 146682)
The equation

But this is filth says usagold.com msg#: 146691.

Does this forum promote gold as a STABLE investment?

No volatility please. This endangers the status-quo.