USAGOLD Gold Discussion Forum Archive

Electronic reproduction sourced from
NetkingSingle Islamic currency proposal (Based on Gold & Silver) #5886708/01/01; 03:50:29


Muslims worldwide should gradually shift from the paper currency system to the more viable single Islamic currency of dinar and dirham which was based on the values of gold and silver.

Leader of the Murabitun World Wide Movement, Umar Ibrahim Vadillo, believes that Muslims should strive to re-instate the single Islamic currency introduced by Umar Al-Khattab, the second khalifah of Islam, over 1,400 years ago.

He said from an economic point of view the usage of the Islamic currency was more viable as their value could not be manipulated by any forces. (Oops there's that "M" word again-Netking)

"The only currency that could challenge the US currency is not the Euro or a currency of the Union of Muslim countries but it is gold, because gold is not a promise of payment, gold is a commodity with a certain standard value by itself. There is no inflation involved and many important studies over centuries show that the price of gold is quite constant." Umar Ibrahim successfully minted the first Islamic dinar in 1992. . ."
Good on them, if it's good enough for the Russians & Mexicans . . .

SteveHHBM#5886808/01/01; 05:42:15

Check this one out.


SteveHAnd this one too, HBM#5886908/01/01; 05:43:55

Interesting, eh?
Cavan ManHey, SteveH#5887008/01/01; 06:42:46

Those pages were "unavailable for viewing". Caan you post a synopsis please? Thanks
Hill Billy MitchellCavan Man @ # 58870#5887108/01/01; 06:55:13

Hey, C'man, Sir,

Long time no talk. I had trouble with the links from SteveH also. Try this, which worked for me. Copy the links from the forum page and paste them to the address area of your microsoft explorer. I am not familiar with netscape if you use is as a navigator.

Very respectfully,


PS: Tell SteveH that those two graphs are fabulous. Will have some comments when I can.

Black BladeThe Next Bubble to Burst#5887208/01/01; 06:58:20


The dollar is maintaining its strength largely on the massive inflows of capital from foreign investors. This is generally regarded as a flight to quality or a quest for higher performing assets, but foreign investors seem to be forgetting one thing. The return on a foreign asset includes the change in the exchange rate between the investor's domestic currency and the currency that the asset is held in, and the U.S. dollar has nowhere to go but down. One would think that with the bursting of the tech bubble still fresh in everyone's mind, investors would at least consider using some fundamental analysis to examine the price they are paying for an asset. Alas, such is not the case.

Black Blade: I'll hold gold as my "currency" diversifier.

Black BladeWhither the Dollar? Too Strong for Its Own Good? #5887308/01/01; 07:06:15


WASHINGTON Is it time to rethink the strong dollar policy?

The Bush administration says no. Although he has not completely convinced the financial markets that he means it, Treasury Secretary Paul O'Neill, backed by the White House, has repeatedly insisted that he has no plans to intervene in the currency markets or to talk down the dollar, which has shot up this year against the euro and the yen.

But a growing number of economists - never mind workers and executives in American industries that are being squeezed by the strong currency - say it is time to consider whether the dollar has risen to a level that could do more harm than good. They have two basic arguments. One is that the dollar is making U.S. exporters noncompetitive in international markets and hurting the bottom lines of multinational corporations when profits earned abroad are translated into dollars. The result is lost jobs and faltering stock prices at a time when the economy seems perilously balanced between recovery and recession.

The other is that the United States is running an unsustainably large current-account deficit, and that at some point, market confidence in the dollar will collapse, harming the economy and the markets. In this view, pushing the dollar's value down in a controlled and gradual way would reduce the risk of a precipitous and destabilizing decline down the road.

Black Blade: Looks like the pressure for a weaker dollar is to become intense as the "Bone Pile" grows and multinationals suffer.

Cavan ManHBM and BB#5887408/01/01; 07:08:48

Black Blade: I expect my electric bill to be at least $350 this month which is + about $150. The $600 I am getting back will either be used to pay my utility bills or, at the local coin shop.

HBM: Thanks. That worked well. Greeting from humidityville....CM

LeighTrail Guide#5887508/01/01; 07:09:14

Good morning, Trail Guide! I read your message about legal tender last night over and over, trying to find out if you were hinting that Eagles (and possibly Maples?) might be called in. If you know anything, would you mind giving us a stronger hint? Thank you so much!
Black BladeWritten Testimony Concerning Conflicts of Interest Faced by Brokerage Firms and Their Research Analysts #5887608/01/01; 07:13:19

By: Laura S. Unger Acting Chair, U.S. Securities & Exchange Commission

Before the Subcommittee on Capital Markets, Insurance, and Government Sponsored Enterprises, Committee on Financial Services United States House of Representatives

Black Blade: The link is to the SEC testimony charging the "Pied Pipers" of Wall Street with unethical and possibly illegal activities. Uh-Oh, better trot out old Abby Jo to calm down the lemmings.

Gotta run - I have to help out a few Grasshoppers with their energy problems.

Cavan Man - Gold or Electricity? Tough call. Cheers!

Buena FeChina#5887708/01/01; 07:26:19

China Press: Deregulation starts on gold jewelry retail prices
Shanghai, Aug. 1 (BridgeNews) - China's State Development Planning
Commission (SDPC) has liberalized retail prices of gold jewelry in the domestic
market from Aug. 1, as part of the deregulation of the local gold market, the
official English-language China Daily reported Wednesday. The liberalization
will help boost China's gold consumption, the report said.
( Story .10252 )


Buena FeCHANAGE=CONSTANT#5887808/01/01; 07:40:37

IRAQ: Kuwait opposes US military strike against Iraq
Kuwait City, July 31 (AFP) - Kuwait's State Minister for Foreign Affairs
Sheikh Mohammad al-Sabah said on Tuesday the emirate is opposed to any U.S.
military strike against Iraq because this would harm the "brotherly Iraqi
( Story .18570 )

Cavan ManBuena Fe#5887908/01/01; 07:54:08

Lawrence was one of the few who understood their culture.
Hill Billy MitchellThe Dollar Bubble#5888008/01/01; 07:58:23

Would it be reasonable to speak of a "Dollar Bubble". I think it would be. Maybe that term has been used by someone else and comes up from the recesses of my mind.

This "Dollar Bubble" will burst. The price of the dollar in relation to all things real and imaginary (especially Gold)will not find a place to land.

U. S. Citizens will be the only people on earth who will be forced to transact thier business in this dollar. Woe is me, will be the cry of the U.S. Citizen who has no gold, when the "Dollar Bubble" breaks.

Very respectfully,


BelgianPremature Conclusions....#5888108/01/01; 08:06:08

* Gold-Holders * Real owners of something Real, are using their physical gold, to increase the amount of paper dollars for whatever purpose it might be. Underground's richests ores are depleted and sold forward, all kinds of official gold is swap-pe-dized and states are infiltrated with gold-averse factions ! Spotsales and buy-back instruments (sell and lease back) together with weak hand physical selling...are all signs similar to the picture of a sinking ship and its rats. The latest Lebanon rumour is remarkable to the point that 45% of this country's foreign exchange reserves "are" physical gold ! The manipulation submarine, launched another torpedo.

Each and everyone of these goldholders, small or big, has his particular reason for using the gold in possesion for other purposes than pure store of universal and transferable wealth. Physical Gold is used (misused) to generate more confetti. This is a clear trend in full swing and for the time being, very lineary resulting in a permanent price decline. Of could you otherwise sell a fraction of physical gold at spot and lease it back later...with "a profit" ?

But there must be a counterparty (counterparties) to this pseudo-sales. The (smart)(smarter) ones that have exactly the opposite in mind : acquiring small amounts of gold at spot in exchange for less and less confetti...what a feast !
That counterparty isn't (is not) definitely a new and unknown association of worldly women, addicted to vanity and gold jewelry !

The gold-selling of the publicly known goldholders have one aspect in common : they add too and precipitate the DEBT DEBAUCHERY ! They artificially freeze more water to the debtberg.

The stealth Gold buyers can only have one ultimate target in a permanent gold depreciation climate : ADSORB AS MUCH OF PHYSICAL GOLD THEY CAN GET ! Economics 101, applicable to every transferable tangible.

If the above trend, with the same totalitarian impact, should take place in land / houses / art etc...the same stealthly buyers would remain anonymous. But as soon as valuations start to become exaggerated...the more buyers are found ready (enjoy) to expose their idendity to the public. To be able, buying valuables at obscene prices isn't a popular activity. Kind off anti-collectivism.

Accumulate with the flow. And have the ambition to become a house/kitchen/garden Cecil Rhodes & Co. Be your own central bank and govern your possesions in your own fashion. No I.A.

Hill Billy Mitchell(No Subject)#5888208/01/01; 08:06:40

I just did an advanced search via the Google engine under "The Dollar Bubble" and came up with 197 results.

Must have been in the recesses of my mind suggested by others.

For those interested I would suggest doing this search. A quick glance indicates that most of the posts warn of the imminent end of the dollar, as we know it.

Very respectfully,


Tree in the ForestBlack Blade#5888308/01/01; 08:12:48

Hello sir. Do we know what time this strike is supposed to start? Have you heard anything on the NUM announcement? Thank you.
Goal LineSA Miners Settlement?#5888408/01/01; 08:31:41

It looks like the NUM is reccommending acceptance of a last minute offer. Here's hoping!

JOHANNESBURG, Aug 1 (Reuters) - South Africa's powerful National Union of Mineworkers (NUM) said it would recommend to its members new offers from gold producers that could avert a strike planned to start later on Wednesday.

``The negotiating team of the NUM feels it has a package it can sell to its membership,'' NUM spokesman Moferefere Lekorotsoana told Reuters by phone.

The latest offer from owners could avert what might be the biggest mine strike since the end of white rule in 1994.

South Africa's number two and three gold mines, Gold Fields and Harmony , and marginal miner Durban Roodepoort Deep (DRD) are the last gold miners deadlocked with the NUM over its demand for a 2,000 rand minimum wage and extra leave.

The NUM had said on Friday it would go ahead with a strike voted for last week because it was unhappy with the mines' proposals on when to phase in wage and leave changes.

DRD, which said it could not afford the 2,000 rand minimum wage, had said its operations could not sustain a lengthy strike and would have to close down with the loss of 20,000 jobs. DRD produced 260,483 ounces of gold in the three months to the end of June with cash operating costs of $228 an ounce.

Lekorotsoana said DRD had offered a 1,600 rand minimum wage from January and a total of 24 days annual leave.

Earlier NUM general-secretary Gwede Mantashe told public radio an offer close to the 2,000 rand demand was ``something we can look at''.


Gold Fields and Harmony offered 25 days' leave, to be implemented by December, 2001, and would enter into a review of the entire leave issue next year, Lekorotsoana said.

Gold Fields was prepared to introduce the 2,000 rand minimum wage from July, 2002, while Harmony would implement it between October and December next year.

Harmony said on Wednesday that every 0.25 to 0.5 percent wage increase it offered would cost one million rand a month.

``The problem in this industry is that it is so easy to fragment. The NUM got agreements with Anglogold and the rest of us had to comply,'' Harmony CEO Bernard Swanepoel said at a presentation of the firm's quarterly results.

Harmony reported a fall in earnings per share to 37 cents in the quarter to end-June from 68 cents in the March quarter.

World number one bullion producer AngloGold and South Deep Mine (Toronto:PDG.TO - news) settled with workers after the Chamber of Mines offered eight percent increases for higher-paid workers and nine percent for the lower-piad workers.

--Additional reporting by Allan Seccombe

WarrenFOA TRAIL GUIDE>#5888508/01/01; 08:57:22

Learn to write like a westener-All your words are garbage.

TG said.

Take a dollar out of your pocket and see if your name is written on it.No it is not!. He also said it belongs to the treasury, federal reserve or both.

You may be right, But you are saying that all mens labors, savings, homes and all that he has purchased with the unowned dollar belongs to the treasury or federal reserve.

Is that the best you can write at times like this. Go back to school, or quit trying advise people with their life.

Any person at all that has been using the dollar since the seventies, when the gold window was closed knows the dollar is doomed.
Neither you nor I nor even Greenspan can tell how the end will come.

I have been waiting for some great revelation from FOA and Another- So far just dishwater.
Go east young man go east.


PH in LAGarbage: Somehow There Is No End To It#5888608/01/01; 09:09:20

Hey Warren,

whoever you think you are! You are probably history around here (as well you should be!) but just so you know:

Your comments are less than garbage, they are garbage that are not even written in correct grammatical English. If this is the best you can do, I suggest you

"Go back to school, young man! Go back to school!"

CoBra(too)@PH in LA #5888708/01/01; 09:26:35

Thanks Sir and well done! The only possible response, except 'go back to your warren and chew a carrot instead of a cheroot' - the rest is moot.

@ Goal Line - Welcome and thank you for the post on SA and potential NUM outcome on Harmony, Goldfields and Drooy. Still held on to all three (though Drooy is for free, as 50% of my holdings fell prey to my 100% appreciation rule in May). As I said 'buy on strike news', though at this particular juncture it took more than nerve - call it exuberant verve!

Regards cb2

PS: @ auspec - Sir, won't ever again beat about a bush with a twiggy ... waiting for more swap relevation from Midas later today.

LeighWarren#5888808/01/01; 09:34:43

I thought Trail Guide was saying that physical paper dollars, legal tender, are units of exchange and not wealth itself. Sort of like what I was telling my son yesterday. And for some bogus reason in the past they were determined to be property of the Treasury/Federal Reserve. But if you quickly spend those paper dollars into something tangible, then you're OK.

Is that right?

Cavan ManOOOH, I hate that wabbit! (Elmer Fudd)#5888908/01/01; 09:35:39

Hey, wee little bunny; go back to your warren indeed. You'll find the space there small, dark and shut in. Does this description aptly resemble anything close to home?
Cavan ManWarrens and bunnies#5889008/01/01; 09:36:55

More dishwater and (wine) and..fresh horses for my men!
JCF"Government to Borrow $51 Billion, Partly for Tax Rebates" - WASHINGTON POST, 8/1/01#5889108/01/01; 10:36:50

Let's see now. A government, that like all governments, can create money out of thin air via it's central bank, decides to "borrow" from itself. And everyone gets upset.

If I shift Federal Reserve Notes (FRNs) from my left pocket to my right pocket, does it really matter? Especially if I were given the legal authority to create them at will?

(Personally, I'd rather just convert them into gold...)

VardaNo more Warren#5889208/01/01; 10:42:16

Why we just pull the plug and clean the air.
Max RabbitzHey, What's all this talk about shooting Wabbits?#5889308/01/01; 11:20:46

You have to read the trail talks carefully. We are seeing only the plan for the bonsai tree. To know the plan will help to understand the coming snips of the shears. Also, note that our Trail Guide is no longer the speaker but rather another.

Leigh...... If legal tender status is removed it does not mean that confiscation of the $50 dollar gold piece necessarily follows. You just can't use those gold eagles as legal tender. You could still barter. Still, I prefer the pre 1933 gold coins for a little more safety and because of the history.

I found the following trail words interesting with regard to the status of the U.S. gold reserves: "Price inflation will have to be ignored. To this end the group of dollar supporting countries, we refer to as the dollar faction, has locked itself into a box. It must find a way to float gold prices with A GOLD RESERVE THAT ONLY DRAINS AWAY IF WORLD GOLD PRICE RISE." Does this mean that "our" gold reserves are somehow committed to other parties should the price of gold rise? Is it that the gold belongs to the Treasury but only until the gold or interest rate derivative bets, or other paper manipulations go bad? I suspect our gold is already well tied up in the manipulations. Remember that the ESF and Fed have great latitude of action to defend the dollar. I think Secretary O'Neill was shown the truth and had no options but to continue to suppress the price of gold....thus the decline in lease rates. I'm just trying to make sense out of this to better see what is coming. Physical gold ownership looks better every day. Thank you FOA.

Cavan ManJCF#5889408/01/01; 11:34:41

Borrowing money to pay rebates; that's crazy.
Max RabbitzLeigh, #5889508/01/01; 11:47:58

If the Government has need of more gold and it is the legal owner of the money in circulation, the Treasury could reclaim that part of the money supply that is in the form of $50 Eagles/Maples. Perhaps this is why they put a dollar value on the Gold Eagle and Mapleleaf. Can people really be this mean? But the effort needed to confiscate would probably not be worth the return. Not many people have physical gold anymore and fewer yet keep it in safety deposit boxes. Hey, they can't even find Chandra Levy. Have they thought to check Clinton's apartment?

Back to work.

site stewardOld dogs playing old tricks#5889608/01/01; 11:53:10

Very little detective effort revealed "Warren" to be none other than our old friend "Golden Hook", who's password was deactivated long ago for disrespectful behavior and bad temperament.

It would seem that some people just never learn good social graces...


site stewardHEADLINE: Most Investors Flunked Wall Street Knowledge Survey#5889708/01/01; 12:14:02

WASHINGTON, Aug 1 (Reuters) - Nearly 85 percent of U.S. investors surveyed failed to correctly answer five basic questions designed to measure awareness of what to do in turbulent stock markets or when confronted with other financial problems, a study released on Wednesday said. Only 1 percent got four of the five questions right, and just 15 percent got three or more right...

These two quotes from the article tell the story:

"It has become increasingly evident to us over the last few years that many investors either have no knowledge or, even worse, the wrong information about a number of key issues that can haunt them during tough financial times." --SIPC President Michael Don

"New investors come in during bull markets and then don't know what to do when things go sour later. People need to take the time to learn the basics about investing and then put them into practice." --Robert O'Hara of the NAIC

Imagine the effect upon the gold market (and pricing) if/when the masses do become better educated!


site stewardArgentina, Ecuador... NEXT!#5889808/01/01; 12:24:02

HEADLINE: Rising Capital Flight Worries Venezuela's Chavez
"We are worried because capital flight has increased; because there are a group of Venezuelan capitalists taking out dollars, perhaps even to destabilize the country because they have tried that before," Chavez said, according to an official news release Wednesday.

Motives aside, the big question becomes, "Where ya gonna fly to?"


site stewardOvernight repurchase agreements#5889908/01/01; 12:33:13

The Fed tweaked monetary policy again today through open market operations, temporarily adding $5.3 billiion to reserves of the nation's banking system.


LeighMax Rabbitz#5890008/01/01; 12:34:55

Trail Guide did say something about a year and a half ago about Eagles being legal tender, and he couldn't be sure they wouldn't be called in. And now he's talking about how the Treasury/Fed have a claim upon our legal tender.

Trail Guide, what are you saying?

site stewardAgentina looking to Europe?? Imagine that!#5890108/01/01; 12:40:01

PARIS, Aug 1 (Reuters) - France's finance ministry said on Wednesday it was keeping "close contact" with its counterparts in Europe and the International Monetary Fund on Argentina's economic problems.

Local media in Argentina have reported that the government, beseiged by fears of a debt default and struggling to restore confidence after a three-year economic slump, was looking to Europe for help to ensure it could meet its financial needs.

And to think how very recently there was talk of complete "dollarization" for the Argentine economy. Those days now would seem long gone by...


SteveHHBM#5890208/01/01; 13:02:14

Charts showed that five or more interest rate cuts did not have an impact on the market in 1929 and in 2000-01 as they did in other recessions. I found the original link on a link at kitco from this morning.
NetkingThe Silver Countdown Begins - Ted Butler#5890308/01/01; 13:48:01

Silver Bugs, your weekly fix herewith!<grin>

Ted Butler's latest on Silver herewith tackles a number of things including the question that I am asked most often is, "when will silver explode in price?" . . .

Centennial Precious Metals, Inc. / USAGOLDHard assets... Easy access!#5890408/01/01; 13:49:34

Golden Goal

"For as long as cannons have thundered,
they have echoed
with the sound of men yearning for gold."

-- R. Strauss

Palant'rSeeing why there are skeptics -- slow to acknowledge the unfolding changes to gold and currency markets#5890508/01/01; 13:50:11

In the popular public eye, the dollar shall not forever be upheld as if exalted and upon a pedestal, and neither shall gold for long remain seemingly as though trodden under foot.

The sands of time a great years ago marked the passage of a man who, by his scholarship and experience, understood "power politics" thoroughly with sentimental detachment as few others have. Even today his words ring with relevance for those who would critically observe such things as we see here with the establishment of the European Monetary Union.

"It must be considered that there is nothing more difficult to carry out, nor more doubtful of success, nor more dangerous to handle, than to initiate a new order of things. For the reformer has enemies in all those who profit by the old order, and only lukewarm defenders in all those who would profit by the new order, this lukewarmness arising partly from fear of their adversaries, who have the [existing] laws in their favour; and partly from the incredulity of mankind, who do not truly believe in anything new until they have had actual experience of it." -NM

Through the help of others, we shall see what we shall see.

Tree in the ForestGlobalization for a New World Order#5890608/01/01; 13:56:59

The Oregonian

Protesters tell of raid by police at G-8 summit


"The blows rained down one after another; all you could hear were the screams and the sick thuds of flesh being battered," wrote Sherman Sparks, 23, of Salem. "I saw no one put up resistance."

Sparks and Morgan Hager, 20, of Portland, were among 93 demonstrators arrested in the early morning police raid July 22 at the Diaz school in Genoa, where nonviolent protesters had gathered to sleep after demonstrating at the G-8 summit of industrialized nations.

"I remember being hit in the head several times and also on my back, sides, shoulders, legs and groin," Sparks wrote. "I think that more than one police (officer) was beating Morgan and I at one time, but of this I am unsure."

By the time police left, "every person in the room had been beaten badly," he wrote. "A couple of people looked like they could be unconscious, and several appeared to have broken limbs."

Hager and Sparks were treated by paramedics and taken to the hospital. Hager describes a painful ordeal in which an X-ray technician tried to force her hand, which was broken in three places, to lie flat. But she told her mother that other people fared much worse. "She was in a cell with a German girl whose teeth had been knocked out," Susan Hager said.

Tommy Psite steward #5890708/01/01; 14:23:55

It looks like Argentina does not want to due business with
the U.S. banks, gee I wonder why? Funny....doesn't the lender always have say over the borrower.

site stewardWhite House economic adviser Lawrence Lindsey says, "Hands off the dollar!"#5890808/01/01; 14:30:02

In response to the director of the International Institute of Economics, C. Fred Bergsten who said the Bush administration needed an "exit strategy" from the "strong dollar" policy, Lindsey said: "We've been there before. Intervention has proved unsuccessful over and over."

While Lindsey provides this perspective that the markets rule in the end, Bergsten gives us the following unsettling view of how we are currently positioned in the eyes of the world marketplace. The article states:

--- The United States depends upon receiving about $2 billion of capital every working day from abroad, mostly in the form of investments, to finance its deficit, Bergsten said.
"Even a slight decline in that net inflow, let alone its cessation or reversal, would send the dollar tumbling and the economy reeling," he said, arguing that maintaining a strong-dollar policy increased chances of an eventual "precipitous freefall" in the currency's value.---

Looks to me like a case of "damned if we do, damned if we don't." In times like this, you should give serious consideration for additional diversification into hard assets, particularly gold.


Tree in the ForestLeigh#5890908/01/01; 14:45:33

Trail Guide said:

"If you think you own the currency of this country, understand this one item: the political entity that the dollar is owned by, can cancel it's legal tender status at any time. There by removing your use of it's holdings!"

Keep in mind the content of the repost I did some months ago entitled "The Commercial Credit System". The private money of the US are FRNs owned by a private banking cartel called the Federal Reserve. Sure, they can pickup their ball and go home at any time. I can't wait. Good riddance! Let them have their phoney monopoly money! This has nothing to do with the public money system. Re-read that post. I think the link was posted a few weeks ago. Somebody out there has it.

CoBra(too)Tree - a great Synopsis on Globalization ...#5891008/01/01; 15:06:51

... and if I may, I'd like to add some thoughts - hopefully without bias ...

The "Globalization" recently met with a strong opposition. And why is that? As the design was construed to
aid the LDC's to gain an economic standing, not far behind the so called first world. ... and the rich are getting richer - or as Pope Jean Paul II. said "The outcry of the too many poor", are flagrant symptoms of a world not wanting to accept globalization under this pretext.

In Reality the only design was market economy versus humanity! I know, sounds socialistic at best, though to put it to test it is probably more the design of a totaliterian regime of monetary extreme.

An extreme, which history will redeem and categorize as the Credit, R-E and SM Bubbles, which are clearly seen by every historian after the fact. The problem today is the total decay of truth and the denial of any or all problems in the economy (though even Greenspin won't be able to paper over the tailspin of the US - and the world economy).

Now, finally the Fiat US$ is taking it on the chin, while the major SM indices are holding on to slim balances, before the avalanches of utter panic will begin to eat away the rest of the supremacy of US$ hegemony and utterly tank the goldilocks industry of fabled productivity.

... Lots more to say - as the fabled G8 will from now on hide away in a Rocky Mountain Town - to drown their dismay of GENOA ... though, the only thing to contemplate would be a fair and equitable exchange rate of their respective fiats tied to the universal accepted and eternal percepted - value of Gold!

- Thanks for bearing with me - cb2

site stewardEurosystem reserve assets#5891108/01/01; 15:11:27

Last week the consolidated financial position of the Eurosystem declined by 8.5 tonnes of gold as a result of the Deutsche Bundesbank's efforts to issue one million commemorative gold 1DM coins as a fitting tribute to the German currency prior to replacement by euro notes and coins (which occurs five months from now). This drawdown in gold assets was reflected on the Eurosystem books as a decline in gold assets of EUR 87 million, leaving EUR 128.405 billion in "gold and gold receivables".

This EUR 87 million drawdown was dwarfed by a concurrent EUR 600 million drawdown in the value of the net position held in foreign currency assets, reducing that total to EUR 274.1 billion.


R PowellEducate the masses ?#5891208/01/01; 16:32:25

From 58897 by site steward,
"Imagine the effect upon the gold market (and pricing) if/when the masses do become better educated!"
I have been envisioning some piece of news that will spark the POG enough to cause it's price chart to look good enough so that the technical traders (chartists) would initiate enough long positions to create a "trend". Then short covering of the huge leased position would kick in the jets and then irrational exuborant buying by the masses to drive POG well into a four digit price range.
The news item starting all this needs to be sufficiently startling enough but does not even necessarily need to be true. A legitimate horseman or any sensational balderdash or claptrap will do.
I'm not sure if "better educated" investors among the masses is necessary or desireable for my plan. I must ponder on the effect of well-informed, rational investors armed with well researched plans. You're kidding, right?
Next you'll be telling me that they're thinking on their own!

R PowellFront page of today's IBD#5891308/01/01; 16:49:08

Sparks Fly Over Strong-Dollar Policy:
Does It Help, Hurt---Or Even Exist?

In part,
"Experts shudder at the thought of what would happen if these offshore dollar holders suddenly wanted to swap out for rubles, pesos, or baht. The result would be an ugly crash of the dollar. Import inflation would soar.
And worse, the flood of returning cash would need a home. Instead of buying a dacha outside Moscow, that money would go to a mansion in Miami. As long as that money stays offshore, it can't do us any harm. But if it comes here, look out."

This was written by Donald H Gold who writes for the paper. Really, no foolin, his last name is Gold!

Netking, thanks for the Butler fix. I've been shakin a little the last few days but this five page (printed) fix should hold me for a while.

LeighPast Legal Tender Discussion#5891408/01/01; 16:55:41

Who else remembers TG's legal tender comments from way back? Remember how he talked about the Kruggerand being ahead of its time in not having a monetary value on it? (I believe he was saying that made it non-legal tender.) But he did say the Eagles were considered legal tender. Can someone help me out here?
auspecPickin' Thru The Words#5891508/01/01; 17:06:27

The following appeared in "Political Gold" FOA message #86:

"...the guest speaker will be here in a minute."

"...I'll read an item or two from Trail Guide's series: A tree in the making. Please read again this portion of **his** series for clarity."
"...we expand some thoughts from TrailGuide's last talk, a few days ago."
"...paraphrasing what TrailGuide writes:"
"...not the use of TrailGuide's money concept."
"We will meet here for **his** next talk when it comes. I'll {TrailGuide} comment in between."

Comment: There is another person writing the bulk of this piece other than TrailGuide. Am I seeing something that is obvious to all? Somehow I think not.

R PowellFor any who missed this#5891608/01/01; 17:06:55

Once there, click on "Clarify U.S. Policy on Gold and Gold Accounting"
The number of signers is presently 1170.
Some provide a short statement along with the signature, which make for interesting reading. It is possible to sign a real (legal) name for the document while also having your name appear as "anonymous" on the internet list. This is what Mr. Greenspan choose to do so as to remain, as much as possible, mute on the current U.S. dollar strength controversy.

PH in LAWhose problem was that, again?#5891708/01/01; 17:18:26

Tommy P.

You know the old saying: "If you owe the bank a million and you can't pay, you've got a problem. If you owe the bank a billion and can't pay, the bank has a problem!"

With this Argentine problem, looks like the borrower is definitely in a position to be calling the shots.

Sierra MadreI've heard that song before...#5891808/01/01; 17:20:58

C. Fred Bergsten had this to say, according to Site Steward, post No. 58908:

--- The United States depends upon receiving about $2 billion of capital every working day from abroad, mostly in the
form of investments, to finance its deficit, Bergsten said.

This is a familiar song. I've heard it before, several times, as long ago as 1975, and the results were always: DEVALUATION! Count on it, that flow of funds from abroad will diminish and then, panic will ensue.

I have seen it all before, in Mexico. Practically the same words, applied to Mexican economy every time our exports began to flag. Same problem, same defects, same RESULTS.

The dollar's time-line as a reserve currency is coming to an end. Can't tell when, but it cannot be far off. Such a monumental imbalance cannot persist for much longer.

Get some more gold!


Sierra MadrePalantir: your post No. 58908#5891908/01/01; 17:27:51

"In politics, reform is revolution". Benjamin Disraeli, British conservative Prime Minister, XIXth Cent.
NetkingR Powell - Ag#5892008/01/01; 17:28:17

Rich. help may be on the way soon buddy! Market timing from a several sources ("In a multitude of counsellors there is safety") indicates October-December looks ripe for strong up turn. Another source said August "may" be the last month to accumulate physical at give away prices. Other respected timers say end-July 2001 at around $4.13/Oz was a projected long-term bottom.

The picture appears to be looking clearer. We are at a classic bottom, all the signs are there yes. Mines closing, prices depressed, apathy abounds among investorse etc etc. I am more bullish now than I have been, we are looking at or close to the bottom & pressure is building in the "pressure cooker" - IMVHO regards Murray

MarkeTalkMusings on the Crash of the US Dollar (and August 19th)#5892108/01/01; 18:11:29

Here at Centennial I received an interesting telephone call this week from a prospective client who was rather concerned about an imminent crash in the U.S. Dollar and global economy. He directed me to an article--referenced above-- which appears at a website run by Lyndon LaRouche's organization. Whether you know it or not, Mr. LaRouche has been a controversial figure in recent memory for his outspoken views on the U.S. and world economy. Being the curious person that I am, I visited said website and read the article entitled "Bush and Dollar to Crash". I must say that it got me to thinking that at least half of the premise is correct. If the U.S. Dollar crashes (as many posters and pundits at this site have opined over the years), then will the Bush presidency also crash? I don't think many people have made this connection but it is a logical extension of the first.

What intrigued me further was the reference to the Russian economist, Tatyana Koryagina, and her timing of said U.S. Dollar crash--August 19, 2001. It read like a page from Dr. Kurt Riechebacher's monthly missive. I thought to myself: Could the Russians be cooking up some scheme internationally to smash the U.S. Dollar and bolster support for the Euro and Rouble? We know that Russia is no economic powerhouse but still has political and military influence in the world. Russia has cut a deal with Germany to supply natural gas into Europe. Perhaps Russia is in league behind the scenes with the Arab oil states to switch its Dollar holdings into Euros (and a further linkage between the Euro and Rouble). We have already seen the beginnings of this switching from U.S. Dollars to Euros, courtesy of the Butcher of Baghdad, Saddam Hussein.

All of these musings aside, technically from a chart perspective the U.S. Dollar did top out exactly on the lunar eclipse/full moon combination of July 5, 2001. Score a direct hit for Arch Crawford. And now it appears that the path of least resistance is DOWN. How fast we go is the next big question. I have noticed that lunar cycles play a role in the ups and downs of certain markets. Full moons can indicate a top or a bottom, same with new moons. It just so happens that August 19th is the next new moon following the lunar eclipse. Perhaps Mr. Steve Puetz's "eclipse theory" will be right this time and we will see a collapse of the U.S. stock market and/or U.S. Dollar with a "blowout" move by gold and silver.

Another indicator of great interest to me is the Bradley Indicator (found in the Crawford Perspectives newsletter). It has been both correct and incorrect in the past. It is now saying that a cycle top in U.S. stocks is due around August 6-7th and then it is all downhill for the rest of the year! Wouldn't it be interesting if some BIG financial blowout event were to occur in this time frame to fulfill such predictions? I need to look no further than to an Argentine debt default (even after repeated denials of such) or to an imminent Middle East war between Israel, Syria and Iraq. Speaking of that, has anyone noticed in the mainstream press that Iraq has been infiltrating/invading Jordan over the past week with about 10,000 soldiers now stationed in the Jordanian desert? And that Israel has moved its tanks from the Golan Heights to its border with Jordan along the Jordan River? Or that Israel will hit the Palestinian terrorists with full force (house-to-house combat if necessary) when the next Palestinian suicide attack occurs, with full knowledge it will have to sacrifice 150-200 Israeli soldiers? I have not seen this type of news reported in the mainstream press but I have found it at websites, such as and

All in all, the month of August has a track record for marking the beginnings of major moves and should prove to be extremely interesting. Most people don't notice these things because they are on vacation or they have a vacation mentality. Everybody thinks that September or October are the months to watch. I don't disagree but I believe that August will mark the inception while September and October will be the acceleration of the trend. Bottom line here is: If you have been procrastinating about buying gold or adding to your gold holdings, now is a good time to re-think your strategy and to ACT. Don't wait for Saddam Hussein to invade Israel or for Argentina to default on its $128 billion in debt to U.S. and European banks. By then, it will be too late and gold will have skyrocketed.

auspecMarkeTalk#5892208/01/01; 18:38:29

Thanks for your input regarding market relationships to lunar cycles. Are you familiar with Christopher Carolan's book "The Spiral Calendar" and its effect on financial markets and human events? Fascinating work in this field. We are all much more subject to lunar cycles that imagined. No smart remarks, please.
Kind regards

Tree in the ForestCoBra(too)#5892308/01/01; 18:52:53

Thanks for putting up with me good sir! I have a Vietnamese friend who has desribed the life of the people of his country under communism. It is in short miserable. Extraordinarily corrupt. Regulation of everything. Constant conversion of the overprinted, worthless fiat money system. Woman becoming prostitutes because they have no money. Etc, etc. One need only look for the poorest nations of the world and here you will find communism (or socialism). The purpose of this system of government is to bring all wealth and power to a small group of people at the expense of the many. In short, socialism=poverty. See Richard Maybury's excellent site

So the real cure for poverty is unfettered capitalism. Not the crony capitalism we see today. I am talking about true entreprenurial capitalism. This system creates more wealth for more people than any other system man has ever devised. It also respects private property rights. Poor people have more to lose than rich people! Don't believe it? It is true. A rich man can easily defend his property rights with lawyers etc. And if he must take a loss, he has more to fall back on. Not so for the poor man. He must depend on others to respect his meager earnings. The poorest people depend the most on property rights! The best thing for poor people is an honest money system, respect for property rights and a chance under capitalism. This is, in fact, the original viewpoint of the Founding Fathers of the United States.

I do not oppose greater world unity. Only that form of unity which enslaves rather than liberates. The power elite, with their secret meetings and secret agendas and secret societies, do little to inspire confidence. They are 'con'fidence men! Many, like Rockefeller, are avowed socialists! Their goal is simple. World domination under a government ruled by them. Thanks but no thanks. If this is what they push, I'll take regionalism anytime.

In truth, the world is already far more united than it has ever been because of the internet. We already have an ongoing, voluntary globalization process at the speed and in the way that the people prefer. We see it right here on this board. USAGold is my kind of globalization! And so, I continue to post the heavy handed and egregious errors of the globalist cabal. A good evening to you CB2.

auspecMax Rabbitz#5892408/01/01; 19:21:02

Looks like we came to the same conclusion regarding TrailGuide's recent talks. This started on 7-12-01 with his "On the trail":
"As we begin today, I notice a side path that lead away from the Gold Trail. At its end I see a group of people listening to some person standing on a tiny stage. Let's ease over there and see what this funny looking guy is saying."
The only person I would feel comfortable describing in print as "funny looking" would be myself. I now believe he is simply talking in the 3rd person as opposed to another person doing this talking.
Couple of guys with too much time on their hands is the final conclusion.

canamamiA political win for gold in '97 - campaign finance and gold clauses?#5892508/01/01; 20:36:34

I previously posted that gold clauses were made legal again in 1977. Heirs of the Trostel estate owned a commercial building in Des Moines, Iowa. A 99-year lease had been entered into circa 1917. The heirs were receiving, I believe, about $23,000 per annum rent. The true commercial value would be about $1 million, or is alleged to be that amount. The original lease contained a gold clause, giving to the lessors the right to demand payment in gold coin of the same nature, fineness, etc. as existed at the time of the lease. This was a kind of anti-inflation clause then in use for long-term contracts. Anyway, the enforcement of gold clauses was outlawed in, I believe 1933, but this was repealed for obligations entered into after 1977...i.e., Congress made gold clauses legal again in 1977.

The lease was transferred to a new party in 1990. The agreement pro-forma referenced the original terms, which of course contained the gold clause. The Trostel heirs argued the 1990 transfer again triggered the gold clause. They demanded payment in gold coin. They won in court. Apparently, the paper dollar equivalent is about $360,000. Not a $million, but better than $23,000.

See the excerpts from "the insider" reproduced below, and the link to the case decision reproduced above. Apparently, Congress limited the effect of the 1977 restoration of gold clauses in 1996, which was apparently intended to change the outcome of the Trostel lawsuit. The losing party was an insurance company. A few days after the 1996 amendment, the insurance company gave the Republican party $100,000. However, gold won this battle. In 1997, the 1996 amendment was itself repealed, and the law restored to the 1977 state, which completely restored gold clauses. In fact, the '96 amendment was to apply to the sorts of situations in Trostel, so that old gold clauses could not spring back to life unless everyone expressly agreed. However, the main practical impact, IMHO, for gold clauses is in the case of these old leases, because gold clauses are not really used anymore, to the best of my knowledge, which is the fault of goldbugs, I submit; you Americans have the right to use gold clauses, so if you really believe in gold why don't you use them?

Anyway, gold won a political victory in 1997, in addition to its win in 1977. And the Trostels won their case in the end, which I submit is only right. Would the original owner have agreed to such a long lease with locked-in rent, without the protection of a gold clause? Probably not. Here, gold served its role by protecting this man's heirs. See below the excerpts concerning the political contributions.

#7 SMALL CHANGE MEANS BIG CHANGE: A two sentence change in federal law, passed with the aid of Republican U.S. Sens. Jesse Helms and D.M. "Lauch" Faircloth, has made an Iowa insurance company very happy and a Colorado heiress livid. Anne Galbraith is losing hundreds of thousands of dollars on a Des Moines, Iowa, building she inherited from her grandfather because the change means the rent she is stuck at 1933 prices -- $23,000 a year for space that could fetch more than $1 million a year. The change involves "gold clauses" put in long-term leases in the early 1900s to protect against inflation. They allowed owners to demand rent in dollars or its value in gold (Carol Leonnig, CHARLOTTE OBSERVER, 6/29). The clauses were banned during the Depression, but Helms led a drive in 1977 to allow landlords to enforce the clauses in certain situations. Galbraith invoked the clause in 1991 and won in court last year. Meanwhile, Helms was approached in 1995 by a Washington lobbyist seeking to limit gold clauses to help a client in Texas facing a hefty rent increase because of a gold clause. Helms aides say he was too busy and the matter was referred to Faircloth, who got the change added to the 1996 Economic Growth Act. After the law passed, Galbraith's tenants, American Life & Casualty filed an emergency appeal to the U.S. Supreme Court claiming the amendment was specifically designed to help the company. The court ruled in the company's favor in February. Stephen Hilbert, chairman of Conseco, American Life's parent company, wrote the Republican National Committee a check for $100,000 within days of the amendment passing. Helms and Helms said there was no connection between the contribution and the company's claims to the Supreme Court. They have written Hilbert asking him to retract statements the amendment was intended for American Life.

#4 CAMPAIGN NOTEBOOK: An obscure "gold clause" has led to a gold mine for the Republican National Committee, perhaps thanks to Republican U.S. Sen. D.M. "Lauch" Faircloth. Conseco, an Indiana insurance company that won a huge windfall from Faircloth, was the biggest giver to the GOP in March -- $400,000 by the company and its chairman, Stephen Hillbert. Some of that money could go to Faircloth's campaign. He authored an obscure amendment, involving gold clauses, that essentially kept Conseco's rent for an Iowa office building at 1933 prices (CHARLOTTE OBSERVER, 5/3). ...

NetkingAuspec#5892608/01/01; 20:40:05

Sir Auspec, after seeing what you had Putin down I now realise that funny looking chap is YOU, phew that's a relief!<grin>

The next excerpt should be good one yes, FOA says ". . . Next time I will discuss; what one should realy expect to see when all paper burns; and how close political events are saying we are to that fire! . . ." I suspect our gold & silver will be prime assets yes given that scenario.

Chris PowellSouth African gold mine strike averted at last minute#5892708/01/01; 20:47:58

South African gold mine strike averted at last

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Black BladeForbes Body Count#5892808/01/01; 21:41:14

Throwing more carcasses on the "Bone Pile." Many say that the "Bone Pile" will grow much higher this year and into the next.
HoratioThe RACE to the Bottom#5892908/01/01; 22:31:07

Gold is sold in Dollars,but in S.A. its mined in RAND.In order to keep the mines open and avoid confiscation by the government it has been necessary to devalue the RAND everytime the gold price goes lower.Lower price = lower RAND.thus the race to the bottom.Evidently the bottom has been reached since now the miners can't live on the devalued RAND and demand higher wages.Higher wages =higher gold prices.The mine owners now know they have squeezed every bit of wages out of the miners and they have gotten all they are going to get.FRom here on out to survive ,it must be higher prices for them.The next thing to do is to sign long term wage contracts at fixed wages,before prices go up and the miners demand a piece of the action.Then the stage will be set for a price rise that flows right to the bottom line.
If wage costs are 50 %and they get a 10 % raise then the gold price must rise 5 % just to cover the new cost.
Things could get very interesting......

NetkingOngoing destruction of the U.S.A. Dollar 1929-2000#5893008/01/01; 22:39:24

See how your purchasing power has changed over the last 70 years.
Black BladeCalifornia business hit hard by electricity rate increase #5893108/01/01; 22:44:56


HOUSTON, Aug. 1 -- Recent electricity rate increases disproportionately affected California businesses compared to residential consumers and some businesses are being forced to shut down or scale back, said the California Manufacturers & Technology Association of Sacramento. After receiving the first electricity bill following the California Public Utility Commission mandated increases in June, many companies complained to the trade association their businesses face shutting down. The association has asked the legislature to correct the allocation of the rate increase imposed by the PUC. "The 3¢/kw-hr rate increase shifted the costs from residential to business," said Jack Stewart, president of CMTA in a release. "Many businesses first month bills reflect rate increases of more than100% even up to 190%." Business complained they have borne the brunt of the rate hike to save consumers from huge rate increases. But that strategy will ultimately back fire on the consumer because layoffs will increase and communities will lose tax support, Stewart said.

The problem threatens to worsen if the legislature imposes the burden of servicing a multibillion bond issue to recover state power expenses on business. The trade association is lobbying the legislature to try to prevent making a bad situation worse.

Black Blade: The recession in The People's Republik of Kalifornia will only get worse as the redistribution of wealth accelerates. "Red" Davis's energy plan has so far plunged the state into a deepening recession. Now the tax payer will have bonds that must be serviced and ultimately repaid - read increased taxes. Increased costs are being passed on to the consumer in the form of higher prices and the economic recession has resulted in numerous layoffs with many more to come. In spite of knowing this day would come, the Grasshoppers refused to prepare. "…and they danced, sang, and played all summer…"

Time to prepare with PM portfolio insurance as this plague (energy crisis and recession) is spreading across the land.

BTW, tonight the House voted down a waiver for California's EPA mandated reformulated fuel standards. I guess the down-winders won't have to choke on the smog spewing from the Grasshoppers tail pipes as they sit hours on end on choked highways.

Black BladeHouse Passes Energy Exploration in ANWR#5893208/01/01; 23:14:15


Bi-Partisan Support Shifts Momentum to Senate

WASHINGTON, Aug. 1 /PRNewswire/ -- Advocates of exploration for new American sources of energy were encouraged today by strong support in the House as legislation passed that would allow for oil and gas exploration in a small portion of the Arctic National Wildlife Refuge (ANWR). Despite predictions that ANWR would fail, the victory was credited to broad support from labor, energy users and Native Alaskans.

``We can give America the energy resources it needs without disturbing our environment,'' said Al Adams, an Inupiat Eskimo and former State Senator from Alaska. ``It is part of our heritage to share the resources of the land and to preserve the environment and wildlife for future generations.'' According to surveys, more than 75 percent of Alaskans support oil and gas exploration and production. Money from exploration would bring badly needed infrastructure and educational opportunities to people living in remote areas.

Black Blade: It is The AFL-CIO and especially the Teamsters break rank with the Dems and throw support to drilling in ANWR. The potential for another Prudhoe Bay sized filed exists. However, the racist environmental extremists feel that they know better than native Alaskans. I have discussed "Environmental Racism" in the past as practiced by "Club Sierra" and other organizations. The passage of the Energy Bill and ANWR drilling legislation is too late to reverse the severity of the global recession. Even the Unions see the writing on the wall. Now to the Senate.

Sierra MadreWhy call your enemy ugly names?#5893308/01/01; 23:19:55

OK, so you consider President Saddam Hussein of Iraq your enemy. Why call him "the Butcher of Baghdad"? President Bush, Sr., always referred to President Saddam Hussein as "Saddam"; this seemed to me a lack of statesmanship; especially after his Ambassadoress to Iraq practically enticed Saddam Hussein into attacking Kuwait.

A man can be your deadly enemy, and you can be his deadly enemy, but still refrain from silly and demeaning (to the person doing it) name-calling.

For that matter, when it comes to Butchery, Colin Powell has some merit. Also Harry S. Truman.

Name-calling only reveals the weakness of the one calling names.

Thanks for reading.


Sierra MadrePrevious post for MarkeTalk, re post No. 58921#5893408/01/01; 23:22:33

Sorry I did not identify the poster I was addressing.

Good night to all!


Black BladeMorgan Stanley's Meeker Named in Lawsuits#589358/2/01; 00:30:49


NEW YORK (Reuters) - Mary Meeker, the Morgan Stanley (NYSE:MWD) analyst once dubbed ``Queen of the Internet'' for her bullish reports on the sector, was named as a defendant in a pair of lawsuits on Wednesday alleging she provided biased research on eBay Inc. and Inc. The lawsuits come amid increasing scrutiny of Wall Street analysts from investors, regulators, and politicians. Analysts at nine major unnamed brokerage firms used their positions to profit from the companies they covered, acting Securities and Exchange Commission Chairwoman Laura Unger told Congress on Tuesday.

Black Blade: Another "Pied Piper" to face the music. "Pied Piper" Henry Blogett of Merrill Lynch already paid the price settling a lawsuit for similar antics. Maybe "Pied Piper" Abby Joseph Cohen of Goldman Sachs could be next on the Hit List. Most of these Dot.Coms - Dot.Bombs - Dot.Gones have dropped off the radar screen and have disappeared - yet gold still shines.

Black BladeCalifornia Trading #589368/2/01; 00:55:04


In an attempt to solve the state's electricity crisis, California has ventured into the business of providing energy to consumers. In so doing, the state has vastly expanded its role in the electric utility industry. But there is no reason why state politicians and regulators should be better adapted to running the state's utilities than the private sector, which has accumulated the skills and expertise needed to run successful energy trading operations. By contrast, the state's involvement to date will likely cost California ratepayers and taxpayers billions of dollars.

Now, several months later, to the embarrassment of state officials, the state's contracts don't look very attractive. Wholesale electricity prices have been falling, not rising, this summer, as demand has fallen below forecasts. Part of the drop in demand is simply good luck, due to moderate summer temperatures. But at least part of the drop in demand should have been anticipated by state officials after the state's Public Utilities Commission put through rate increases this past spring, even though their design was flawed and their implementation halfhearted. The combined effect of these two factors has left demand for electricity substantially below last year's levels. This has put the state in the almost unimaginable position of having a surplus of electricity, which it must now sell at prices that are well below the state's contracted rates. Demand may yet rebound if temperatures in the West rise.

Black Blade: I must admit, Buy high - Sell Low doesn't sound like much of a plan.

NetkingChances high for a major military explosion in the Middle East. #589378/2/01; 01:55:44

(Regardless of our personal viewpoints of the difficult situation unfolding, these events could clearly affect not only the M/East & greater regional stability but also the financial, commodity & PM markets in a significant manner and are hence worthy of consideration - Netking)


"After decades of stalemated diplomacy and months of renewed violence, the Sharon government appears ready to launch a massive blow against the Palestinian political infrastructure.

The strike will aim to decapitate the Palestinian leadership, destroy key facilities and isolate the Palestinian community. In the absence of external constraints from the United States and regional neighbors, Israel may consider expanding this option to Syria and Iraq as well"

Since it seized the West Bank in 1967, Israel has had three options for dealing with the Palestinian people and territory it controls:

1/The first was to attempt a negotiated settlement such as the Oslo peace accords.

2/The second was to accept the ongoing stalemate and low-intensity conflict.

3/The third option was to escalate the conflict and break out of the gridlock by destroying the Palestinian movement once and for all.

Events over the past few weeks clearly indicate the current Israeli government has chosen the third option and is now in the process of preparing to implement it. Given the Israeli view that the Palestinian leadership is carefully coordinating anti-Israeli operations, the Sharon strategy will be to shatter that capability.

The third option will involve a massive military blow aimed at decapitating the Palestinian leadership, destroying key military infrastructure and communications facilities, and isolating the Palestinian community. It also will involve the occupation and destruction of certain political facilities and the capture, death or exile of the political elite.

And in the absence of external constraints against Israel by the United States and regional neighbors, there is a chance Israel may apply this option to two other longstanding problems: Syrian control over Lebanon and the potential Iraqi military threat to Israel. International condemnation, including the potential for sanctions, will follow any Israeli action. From Israel's standpoint, a broader strike would carry minimal additional cost.

Once the third option is chosen, a broader logic takes over. Since there is little doubt that taking out the Palestinian Authority will increase the risk of conflict with Iraq and Syria, this option might well lead to a decisive strike at a time of Israel's choosing against these two adversaries. From Israel's point of view, now is much better than later.

Several factors stemming from the Six-Day War in 1967 are driving Israel toward such a massive military option . . . .

BelgianWar#589388/2/01; 03:59:17

A Middle East war is guarantee for higher oil prices and refuge into the the time that the Euro presents itself as an alternative. Question : Do "they" want a war per se, as the usual excuse many unsolvable problems ? Will this war (eventually) be different than desert storm and i.o.w. have minimal impact on POG ?
What do you think Sir, King of the Net ?

South African miners need a 5% Rand (permanent) depreciation or a 5% POG increase (282$) or have to deplete the rich ore-bodies (+ 8 gram/ton) at a faster rate.
The courageous B. Swaenepoel (Harmony) is pinpointing the miners "fragmentation", again ! Divide and Rule ! Good luck to you miners.

Note : about the articles from the controversial (?) Lyndon Larouche (Russia) : Have they been reading Trail Guide and are they inspired or the other way around ?

BelgianMarketing Gold ?#589398/2/01; 05:52:09

The following might seem a bit " bizar ", but nevertheless, I'll probably learn something. OK, here we go.

Suppose we have a budget of 55 milion $ confetti and we are in the business of selling and promoting " Gold ". You certainly all know organisations like this (hummm).
It is no secret that on this boiling globe, there are quite some wealthy chaps hanging around. Succesfull entrepeneurs of all kinds and sizes. These people can be selected and contacted in a formal way. Probably, most of them, never considered any investment in physical gold in their possesion. What would it cost to find out how these wealthy persons are to be reached and what would be the cost of establishing an educative contact ? You all must surely feel me coming...

With physical gold at the present valuation and speculating that succesfull entrepreneurs do understand sound reasoning about risk/reward theories...isn't here a high probability, available, for a succesfull marketing on investment gold ?

Here on CPM, we have the prototype of how " Gold Investment Guidance " should be done. Why can't the same principle be used on a broader scale for non internauts ?
As dwarfs, we are fostering our ounce coins. A lot of mini Giants could do the same with Kilograms. I've already made a prototype math on the subject with no reaction on it.
I'm still asking myself what is seemingly wrong with such an initiative.

Once a global gold investor clientele is established, further guidance, trough appropiate contact, can establish
a regulating mechanism on POG. I would suggest to Gold Promotors and guiders to radically change most of the common perceptions (the speculative ones)about Gold and start with some new fundamentals on physical gold investment.

Toughts are appreciated./ Thanks

Black BladeIT'S MEEKER'S TURN #589408/2/01; 06:49:46


Mary - you're up next. Morgan Stanley Dean Witter & Co.'s star Internet analyst is in even more hot water. A class action suit on behalf of Amazon and eBay shareholders - two bubble stocks on which she was bullish for years - was filed yesterday by Philadelphia law firm Schiffrin & Barroway. The suit names Meeker and her firm and alleges she pumped up Internet stocks so that her company could land lucrative underwriting gigs. Joe Schmo investors purchased stock at inflated prices from Aug. 1, 1998 through Jan. 22, 2001, thanks to Morgan Stanley not disclosing all the facts, said the suit.

Black Blade: Another "Pied Piper" of Wall Street could go down hard for leading the lemmings astray.

Max RabbitzLeigh...Krugerrands with no monetary unit#589418/2/01; 07:22:19

I wasn't around here a year and a half ago but I'd bet your memory is good. I came across a related idea in Griffin's "The Creature from Jekyll Island" in the chapter on U.S. monetary history. The U.S. started with a silver dollar standard. In 1792 a bimetallic standard was begun at a ratio of 15:1 gold to silver. However, soon gold came to be more valuable than silver in the market and the gold coins disappeared from use. Griffin stated that it would have been better to not put a denomination on the gold coins and let them float at the market rate. I suspect this was Trail Guides point about the Krugerrand rather than confiscation risk although I do recall him stating that by owning pre 1933 coins he would be a step ahead of the rest. Perhaps he can elucidate.
escapethematrixECB doesn't "blink".....UK does.............#589428/2/01; 08:05:51


The European Central Bank left its main lending rate at 4.5 percent at a separate meeting today. Analysts said ECB policy makers are likely to trim the benchmark refinancing rate by a quarter point before the end of the year. The ECB has pared rates once this year, by a quarter point on May 10.

UK: The move suggests policy makers are increasingly concerned about manufacturing, which contracted for a fifth straight month in July. Invensys Plc, a factory-controls maker, Marconi Plc, the country's biggest phone-equipment company, and steelmaker Corus Group Plc are eliminating a combined 20,000 jobs

For the UK, it's further proof that it's either "inflate or die"....Or join the Euro.

escapethematrixYeah, ..that "Strong Dollar Policy" sure is great :)............#589438/2/01; 08:13:41


New York, Aug. 2 (Bloomberg) -- U.S. companies had their biggest drop in quarterly profits in 10 years as demand for products ranging from chemicals to computer equipment plunged. Analysts forecast that earnings will decline this quarter.
``The numbers are just hideous,'' said Maureen Allyn, chief economist at Zurich Scudder Investments, which manages $345 billion. ``Some of these companies have 30 percent lower sales. There's not an executive on the planet that can protect profit from that.''

uponroofescapethematrix (8/2/01; 08:05:51MT - msg#: 58942)#589458/2/01; 09:09:38

Could this be a set up?

Recieved an e-mail from Ed Bugos today regarding rate cuts. Ed is not asleep despite the quiet on all fronts. You may remember Mr. Bugos from his occasional work with GATA and writings at LeMet.
Good morning,

A bull raid is an unexpected attack by the bullish forces, aka Greenspan's bunch. There has been silence on the currency front, not even a peep at the last G7 meeting of finance ministers.

Since then, certain evolving relationships appear to be setting up for a double back-to-back interest rate cut, first by the ECB, and then by the Fed. This could happen as soon as today, or as late as next thursday, but it has to happen fast, for the ideal conditions are not likely to sit around for too too long.

Thus, we see that there remains a risk to our prognosis for a Dow 7000 objective, but the risk can be summed up as an interuption ;-)

We just posted this week's GIC for subscribers on the members page at our website:

If you haven't subscribed to the goldenbar report, then you haven't taken advantage of our promise to keep you ahead of the curve.

Have a very nice day,
Ed Bugos

Hummmmmmm. A "double back-to-back interest rate cut"? Global measures to combat the strong dollar 'crisis'? An international walk down of sorts? Hummmmmmmm.

Buena FeSetup speculations#589468/2/01; 09:40:08

The financial press/FED/TREA. et al has been massaging perceptions for weeks now that an interest rate cut by a CB is bullish for the underlying currency, in anticipation of the next FED rate cut which will coincide with a moment of market/bond/$ weakness and then huge press/futures intervention to ramp/reverse these components back to uptrends.

The game continues until the end.

escapethematrixuponroof........RE: Bugos # 58945#589478/2/01; 09:54:34

I remember TG saying…’Anything is possible,just not probable." I have read some of Mr.B's work, and respect his opinion, but to me, this seems like a real long-shot. I don't think that in general many of these analysts see the "really big" picture as far as what the real motives in the the Euro/Dollar currency war are, or that it's even going on.

In "Political Gold", TG stated:
"However, all of this positioning has left out, this time, one important, almost unthinkable question; what if current trends are moving away from using our dollar reserve system?" I'm not sure Mr. B. gives this any consideration.
Unless there are some behind the scenes concessions going on between the Fed and ECB, I cannot picture them (ECB) acting in such a manner.

The bottom line is that events are giving shape to "A ghostly illusion that 'noone" could see from afar", but that we at USAGOLD, can follow together thanks to the extraordinary work of FOA, Another, Randy and MK.

Thanks for all your hard work TG… I can't wait to see what's next.

CoBra(too)Is The Bottom in for POG?#589488/2/01; 10:03:55

Bill buckler from the "Privateer fame certainly thinks so.
A snippet from his weekly gold market update:

'The entire present situation is absolutely "tailor-made" for a "resuscitation", not of the Dollar or of economic "growth", but of the Gold price - IN U.S. DOLLARS - the ONE currency against which Gold has not - YET - recovered.

The Genoa G-8 Summit is now over, with nothing having been said by any of the participants about anything which is relevant to the present global financial situation. The U.S. and the world waits for August 21 - when the FOMC meets again and the world gets its next interest rate fix from Mr Greenspan and the Fed. In $US terms, Gold is still less than 6% above the 20 year lows it set in September 1999 and challenged in April 2001.

And now, there are DEFINITE signs that "paper Gold holders" on the COMEX are giving up in despair and liquidating long positions. The situation is "safe" with TWO strong support areas within $US 10 of the present spot future Gold price. It is also "primed" for an upside move, with Gold open interest at levels not seen for more than eight years. The period leading up to Labor Day, during which U.S. markets have suffered significant corrections in every year since 1997, is going to be FASCINATING. Stay tuned."

- regards cb2

Old YellerJapan;good for a few surprises?#589498/2/01; 10:19:26

Some interesting comments here about some old time favorites,hedge funds and their renewed popularity,CDOs,commercial property and the GSEs.Japan holds the most intrigue,though,yen is now strengthening,the outcome may differ from what is the general consensus on Wall St.The last three paragraphs hold some troubling implications for king dollar.
CoBra(too)POO up to 27.85 that's 1.08 $/bbl! #589508/2/01; 10:32:46

What's up, Sir Black Blade? I'm sure you would know the reason behind this move.

Thanks in advance - cb2

Sierra MadreBelgian...your post 58939..."promote gold".#589518/2/01; 10:55:58

Sir Belgian:

I think the big boys around the world, especially outside the U.S., are well aware of gold. They are, I believe, buying it quietly. Not all of them, but among those "big boys" there are some intelligent people.

What you are proposing sounds like a war against the Anglo American financial establishment, which is, it seems to me, at the center of the war on gold. It is virtually impossible to marshall forces against that Establishment.

But, what's the hurry? As long as that Establishment is giving gold away, well, take advantage of the fact. The "big boys" are merrily making paper money profits, a small portion of which, I do not doubt, are going into gold. But these "big boys" are no theoreticians. They are enthralled with visions of billions upon billions - of what? Paper nothings - but they are entrepreneurs, not theoreticians. They are working on the here and now, on "money in the bank" (they do not stop to question the validity of that "money in the bank"; that's idle speculation, to them).

It is next to impossible to tear these businessmen away from their projects, into which they have put their hearts and souls. All the same, some of these men are buying gold, especially those outside the US.

There is no way to stop this war on gold. The only thing that will end it, is a dramatic change in world circumstances; a war, or a runaway inflation or runaway deflation. The inflation or deflation which is to come, will, in absence of war, provide the inevitable detonator.

Then all those very practical businessmen will plunge into hard assets like gold or silver, or whatever they can find next best. But not before. They play today's game until it's over.

In a very real way, this is barbarism. As G.K. Chesterton said (I paraphrase): "The preference for the temporary over the permanent is the hallmark of barbarism".


Yukon"Gold!", premieres Aug. 21-24#589528/2/01; 10:56:28

For those looking to further their education of gold, the History Channel will be presenting a four part mini-series, Gold!. In will be aired in four 1 hour segments beginning August 21 and ending Aug.24. Though I seriously doubt it will include any talk of the price manipulation and the Fed/Treas./ESF involvement, nor any of the details about the GATA lawsuit, it should nevertheless be entertaining and somewhat insightful, especially with respect to the history of gold.

From the cover story of Numismatic News, July 17 issue, "It will open with an installment titled "The Gold Wars," about conflicts that arose over searches for and discoveries of the yellow metal." It then will treat the themes of "Gold Fever," "The Stuff of Dreams," and "Cold Hard Cash."

"Numismatics will likely get prime coverage in the "Cold Hard Cash" segment on Aug. 24, which will touch upon coinage issues from 550B.C. through the centuries to present day.

The History Channel will broadcast Gold! simultaneously over its global network, including 60 countries and all its joint ventures and affiliates, each portion airing at 9 p.m. Eastern and Pacific time Aug.21-24."

To Tree In Forest and Leigh: The post on The Commercial Credit System can be found here on the forum archives. The date of the original post was 4/22/01 and the message number is 52341.

TreeInForst: I have read all of your posts to me about the the gold recall of 1933. Unfortuneately, the posts still do not answer the question of where does it say in the Constitution that the President has the power to issue an Executive Order that has enforcement and jurisdiction over the people of the fifty states. This power, IMHO, seems like the equivalent of a dictator ruling by decree in a Communist/Socialist government. FDR states his authority as amended Acts of Congress, yet Acts are to be made in pursuance thereof (Article VI). So by my understanding, which is taking the words in the Constitution for face value, not only was the EO unconstitutional, but so were the Acts that FDR cites for authority due to the clear violation of Article I, Section 10.

Also, has any challenge to this EO ever been brought before the Supreme Court? For if not, then the action would stand as Constitutional until someone brought a case before the Supreme Court, as they would have no reason to make a ruling until such event occured. Thoughts anyone?

Viva Liberty!


YukonGold!#589538/2/01; 11:11:32

Forgot to post the url for the upcoming series Gold! It has a neat trailer including: "It has caused Wars. It has Financed Empires. Limited Supply. Insatiable Demand."

Sounds like a winner to me... just don't tell WGC. They may get some good ideas. =)

And don't forget to visit CPM when your ready to add to your holdings.

Sierra MadreAs my son says....#589548/2/01; 11:24:33

"If we keep going on the path we are going, we are going to arrive where we are going".

Can't argue with that!

Saludos from Sierra Madre

site stewardTemporary reserves for U.S. banking system#589558/2/01; 11:43:41

The Fed added $6.75 billion in today's open market operations -- $2 billion via 28-day repurchase agreements, $4.75 billion with overnight repos.

To support policy?? The market in federal funds was trading precisely at the FOMC target rate. You do the math.


Centennial Precious Metals, Inc. / USAGOLDHard assets... Easy access!#589568/2/01; 11:47:50

They make new BULLION every day.

They stopped making these BEAUTIES long ago.

A fixed supply has its advantages.

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

Gold Trail UpdateThe Gold Trail Discussion has been Updated#589578/2/01; 12:52:56">The Gold Trail Discussion has been updated. Click on the link to read the latest updates.
NetkingBelgian & CoBra(too)#5895808/02/01; 13:55:57

Sir Belgian:> A Middle East war is guarantee for higher oil prices and refuge into the the time that the Euro presents itself as an alternative. Question : Do "they" want a war per se, as the usual excuse many unsolvable problems ? Will this war (eventually) be different than desert storm and i.o.w. have minimal impact on POG ? What do you think Sir

Netking:> How's THE land of fine chocolate! The first part is harder to perceive. I would expect the POO (per comment to CB2 below)to go upwards, further. The POG would also move(safe haven), & the Euro up against the USD(IMVHO). The second question, lets hope it's a limited action(assuming it happens). Israel will make the calculations & will act against international opinion if the perceived reward risk ratio is worth it for them. They acted against Frances wishes many years ago when France was their chaperone, it proved worth it for them at the time, and with the guardian role shifting after that conflict to the USA, where it has remained since. The USA is "quiet", maybe it's gotta happen(?), if so It'll be quick & surgical, aka 1967?
POO up to 27.85 that's 1.08 $/bbl!
What's up?

Netking: A good barometer for perceived risk (per above) may be one/the answer.

LeighTrail Guide#5895908/02/01; 15:13:24

Thank you for answering my question!

I keep imagining ANOTHER at the mountain lodge at the top of the gold trail, lounging on the breezy porch and watching us westerners hiking down below.

Belgian@ Sierra Madre#5896008/02/01; 16:05:45

Thank you Sir, for the response and take care of that wise son of yours.
site stewardFalling behind by holding dollars -- a Must Read#5896108/02/01; 16:18:44

From this article by Aaron Task

HEADLINE: Waving the Caution Flag in the Race to Weaken the Dollar

--- "A fall in the dollar would have inflationary implications for us, which would diminish the latitude the Fed has in cutting interest rates," said Paul Kasriel, chief U.S. economist at Northern Trust Co. in Chicago.
At 3.75%, the fed funds rate is just 55 basis points above the year-over-year rise in the CPI through June. That's the lowest inflation-adjusted rate among major global economies, Kasriel noted, but the Fed has indicated its willingness to push the funds rate below the inflation rate. "To be the world's banker and to tell people you may not give them a positive inflation-adjusted return wouldn't seem to me to inspire confidence," the economist said.---

Further, here's a sobering summary of affairs by John Mesrobian, an analyst at Constantinople Advisors. He is quoted as saying:

"We strongly feel once the dollar is seen sliding -- when everyone becomes aware of it -- [investors] are going to run for the door [and] many have their track shoes on. The U.S. dollar is in a bubble stage, just like the Nasdaq -- and it will fall just like the Nasdaq."

see the full article at the URL given above

If some people "have their track shoes on" already, have you yourself taken steps to establish a close working relationship with helpful gold brokers at Centennial yet? According to this article, your delay is at sizeable risk.

Belgian@ Netking#5896208/02/01; 16:32:32

Thanks Sir, but I'm a bit worried about the possibility of " Quick and Surgical " ! From my Aussi bro, I got confirmation that UN troops are on stand by in the Jordanian desert. Something serious is brewing. POO move today was significant ( + 7,5%). Shell topman admitted that they impossibly can make any price-range projections on crude, already for quite some time now. Evidence to me that there is much more going on than the balancing of offer/demand, wich is more or less predictable for the top pros. Oil wants to value the dollar with its pricing per barril. Will cee.
Solomon WeaverBugos on Bogus#5896308/02/01; 16:41:00

There was some discussion here a few weeks ago about deflation vs. inflation....and the ensuing problem of even defining them....

The following link goes to an article by Ed Bugos which is an interesting read on this topic.....he compares as well the relative price of various currencies and indexes against gold prices.

This next link is in the middle of the first and is called No SafeHaven.

poor old solomon

site stewardAnother Must Read -- HEADLINE: The Dollar's Days Are Numbered#5896408/02/01; 16:44:25

By Peter Eavis

---At the moment, the foreign exchange market likes the fact that the Fed is opening the monetary floodgates ... It may just be that it thinks Greenspan is more likely to cut rates again, an act that has buoyed the prices of U.S. bonds, which foreigners have been buying ... chiefly based on this interest-rate gamble. After all, why would anyone buy paper of U.S. corporations based on their (truly appalling) long-term fundamentals?---

---So why a dollar crash sooner rather than later? Comparative interest rates give some strong clues. ... real interest rates in the U.S. are just 0.5%, using an inflation rate of 3.25%, compared with 1.4% in euroland. Even Japan's real rate is higher -- at 0.63%. ... Using the 4.5% inflation rate shown most recently by the Cleveland Fed's Consumer Price Index, real rates in the U.S. are actually negative to the tune of 0.75%. People are losing money just by holding dollars. How long can that last?---

Get out while the getting is good. Don't optimistically hold dollars all the way down the same way some investors optimistically held their tech stocks all the way down to bankruptcy. There is no shame in diversifying your portfolio into the hard asset WEALTH of gold. If fact, it's the prudent thing to do. Make a commitment to yourself to call Centennial before the week ends. Gold prices remain quite attractive and accessible near 22-year lows.

wolfArgentina#5896508/02/01; 16:51:02

Argentina biggest problem is the rigidity of its exchange-rate peg and the strength of the Dollar. In a largely dollarised economy a devaluation will cause a bust. A default on their external debts mostly sold as bonds to foreign investor will send shudders of fear through the financial markets.
A even tighter fiscal policy to ward off default and devaluation is very unpopular and will lead to a taxpayer strike, as the taxes are much to high for the near non-existence of public services in this country, ... or get the best to vote with their feet and leave the country for good, as many younger people did in recent times.

Gold Trail UpdateThe Gold Trail Discussion has been Updated#5896608/02/01; 17:31:53">The Gold Trail Discussion has been updated. Click on the link to read the latest updates.
Black BladeThe very real energy crisis - Demand for power is soaring quickly, while expanding supply can take years. That means trouble.#5896708/02/01; 18:02:41


How about oil capacity?

"In the Middle East we've added one substantial field in 20 years. It is just about to reach peak capacity of 500,000 barrels a day. But that's only a small percentage of the 75 million barrels a day that are consumed. In the Middle East some data is now emerging that the major fields are in decline. "The non-OPEC oil supply grew by only 2 million barrels a day through the '90s. That probably happened because the (original) production base is only 60% of what it was. We've been running just to stay in place. In natural gas we've been producing flat-out, but only increased production by 1% or 2%.

"We're on the decline curve," Simmons said, referring to the inevitable depletion of oil production from existing oil fields. Ironically, even if a valve could be turned in the Middle East, our energy problems would not be solved. We'd need new ships to transport it and new refineries to crack it. Similarly, while small turbine producers like Calpine may deliver dozens of small electric generators in the next two years, the increased demand for natural gas to run the turbines may exhaust gas supplies. Basically, there is no slack anywhere because we missed a full decade of investment in new capacity.

Black Blade: This little snippit is part of a very good article on declining oil and natural gas by Matt Simmons of Simmons and Co. Intl. This is what I and a few others in the natural resources industries have been saying for some time now. It is close to crunch time. Oil is a problem, however, natural gas is the real sleeper that will drive the energy crisis. Every new power plant and proposed power plant is NG-fired and as outlined above - no significant gain in production. Interesting that the racist environmentalists oppose the Artic Drilling proposal in a virtual tundra wasteland. It is quite obvious that aside from the racist implications it is also for political mileage at the expense of the public at large. It is too late to stave off the deepening recession, however, we here have prepared for the inevitable economic collapse with hard asset purchases like gold, hopefully getting our financial houses in order, and selective (defensive) investments. The "Perfect Storm" in energy is growing and a "Golden Lifeboat" is in everyone's best interest. Think energy doesn't matter? Read this article.

Black BladeRE: CB2 - Higher Oil Prices#5896808/02/01; 18:07:11

There has been speculation that there will be another drawdown on crude stocks when the API reports this Tuesday. This is a bit of a delayed reaction. Perhaps the House passage of the Artic Drilling Bill may have brought out a few investors who now realize that there is a real energy crisis. Add to this the real summer vacation season begins in August and some speculators are trying to front run the expected price move. Add to this a tropical storm approaching the gulf and some ME tensions and it adds up to higher Hydrocarbon prices. Cheers!

- Black Blade

Black BladeStorm on track to hit U.S. Gulf oil/gas fields#5896908/02/01; 18:13:27


HOUSTON, Aug 2 (Reuters) - Tropical Storm Barry formed off Florida's western coast on Thursday and meteorologists said it could become a hurricane as it churns its way through the oil and natural gas fields of the Gulf of Mexico over the next few days.

National Hurricane Center forecasters said the storm was most likely to make landfall on Sunday in Louisiana where it could pose a threat to the state's large oil refining industry. Oil companies with offshore production in the Gulf of Mexico said on Thursday they had already taken steps to protect workers by moving them onshore until the storm passes but they added that they had not yet suspended any oil or gas production.

The Louisiana Offshore Oil Port (LOOP) said it was operating normally on Thursday but was keeping a close watch on Barry. LOOP is the only port in the United States capable of offloading deep draft tankers known as Ultra Large Crude Carriers (ULCCs) and Very Large Crude Carriers (VLCCs).

Black Blade: With high nearly maxed out refinery utilization rates, any refinery slowdown/shutdown will pressure prices. Another kind of "Perfect Storm?"

site stewardChancellor Brown works for a weaker(?) pound, IMF sends warning#5897008/02/01; 19:41:31,3858,4233065,00.html

If limited to playing within "the rules", it's allowable to weaken a currency through easy monetary policy (e.g., lower interest rates on borrowing), but not through deficit spending by the government.

"(T)he EU's stability and growth pact sets a strict 3% limit to deficits and encourages member states to balance their budgets unless recession threatens."


Gold Trail UpdateThe Gold Trail Discussion has been Updated#5897108/02/01; 21:35:34">The Gold Trail Discussion has been updated. Click on the link to read the latest updates.
Black BladeBank: Tuesday US Data Could Spark Selloff#590268/4/01; 00:45:00


LONDON (Reuters) - U.S. productivity data due out on Tuesday could shatter the belief in a ``new paradigm'' economy of high growth and low inflation, triggering a stock market crash, a leading investment bank has predicted. Dresdner Kleinwort Wasserstein said in a note to clients that revisions included with second quarter productivity numbers will revise away the ``productivity miracle'' of recent years, cited has a major factor in the bull market of the 1990's. ``Investing in the U.S. miracle will in retrospect be seen as a sick joke. The markets will be forced to confront this harsh reality on August 7,'' DrKW Global Equity Strategist Albert Edwards wrote. ``Make a date in your diary! The U.S. 'new paradigm' will then be officially revised away! The risks of an equity crash are high.''

Black Blade: Stock Market Crash scheduled for August 7, 2001? Hmmm… I'll mark it in my appointment book.

Black BladeIMF Prepares to Accelerate $1.2B Loan to Argentina, Establish $15B Credit Line for Brazil#590278/4/01; 01:05:04

IMF to Accelerate Loan for Argentina


WASHINGTON (AP) -- The International Monetary Fund announced Friday that it was prepared to accelerate a $1.2 billion loan to Argentina and establish a $15 billion line of emergency credit for Brazil in an effort to keep economic troubles in the two South American nations from spreading.

Black Blade: As late as last week the IMF claimed that they would not get involved.

BelgianRich/Netking/Auspec/Cavan Man#590288/4/01; 04:38:30

Indeed Good Knights...if there are some very strange, fundamental anomalies, not easely to be explained...we can always blame it on the unknown effects of the massive, overwhelming derivatives ! We and many others are surely underestimating the devastating effect of these derivatives on the natural proces of valuations ! I've always called it "speculative mania" but have been corrected by TG into rightout naming it "Gambling". The temporary periods of
"price containment", (Rich) are probably the moments that the gamblers are stucked and the game is immobilized, waiting for some new blood.

And still, there are fresh, new gambling-kamikazes waiting to participate with large amounts of paper amunition, into this Roman arena. The lions are still hungry.

It is the absense of that natural valuation process, that is provoqing the periodical "burn-out" effect, experienced by less gambling participants. And indeed, it doesn't matter anymore, if this derivative mania is organised or the result of a trendy fashion. But trends do come and will go.

A TG reminder : much, yes very much "paper" will burn ! And
more important : Gold is there to be rightly valuated only once a generation ! This is not kind of paternalistic consolation, but my personal conviction as well. Analyse the characterial profile of Giants and conclude that they have ' Time " ! As dwarfs we lack this very important capacity (genetics=?).

Thanks and a sunny weekend to all.

CanuckDebt cracks 5.7 trillion#590298/4/01; 05:44:33

...on uptrend?
Gold Trail UpdateThe Gold Trail Discussion has been Updated#5903008/04/01; 08:54:49">The Gold Trail Discussion has been updated. Click on the link to read the latest updates.
darkhorseMe thinks this puts a nastier look to things that come....#5903108/04/01; 09:22:41

From the latest off the Gold Trail:

This time, investing in "the industry" or "business" that produces inflation hedging investments will not work enough to do the hedging job. From oil companies to coal companies,,,,,,,, home builders to lumber producers,,,,,,, carpet makers to gold miners: costs will outrun their ability to create an after tax profit.

ME: Has my understanding of English left me, or does this statement mean that not even our sacred gold stocks won't be enough?

canamamiWhy All the Excitement re Russian Gold Policy?#5903208/04/01; 09:32:06

Gold coins are legal tender in the US, also.

Now, it is unclear whether Russia intends to allow Russian#1 to force gold coin settlement on Russian#2, at the prevailing market price of gold, though it appears that is what was intended. Otherwise, the gold and silver coins could not force out the $US.

How does the Russian situation compare to that in the US?Well, one can force settlement (i.e., legal tender) in the US at the dollar face value of the gold coin. This is silly, as the market value of the gold greatly exceeds the face value. However, one could craft contracts which prescribe payment in gold, and a method to determine the day-to-day value of gold, as will be done in Russia. Thus, although in the US gold coin is not legal tender at market value, I submit US law now allows private parties to contract to permit gold coin settlement at prevailing market rates, or such other method of valuation as prescribed by contract.

Sierra MadreHow will the spell be broken?#5903308/04/01; 11:00:16

What do we use paper profts, or paper income, or paper take-home pay for?

Not to buy paper cars, paper houses, paper food, paper clothes. We must have real cars, real houses, real food, real clothes!

Some people do believe that a part of their paper income should go into savings; but, they are satisfied with paper savings; savings that are based on paper values, paper purchasing power. These people are unaware of what they are doing. (They are about as safe in their savings, as if they were in a rowboat 50 yards upstream from Niagara Falls).

Just as we must have real cars, real houses, real food, real clothers - we must have real savings! Savings that have a physical existence, not just a numerical existence.

The human race decided long ago, that the best physical embodiment of savings is: precious metals. But that decision which stood for thousands of years, is under subversive attack; there is definitely a campaign to overthrow it.

At the moment, the human race appears to be suffering from mass hypnosis; humanity is under the spell of number: billions here, billions there, trillions now are spoken of. Companies can lose tens of billions. Eventually, the spell will be broken, and humanity will have to come to its senses: a trillion paper dollars will not fill an empty stomach; only a piece of bread will do that. (Weimar, 1923) Reason tells us this. However, metaphysics tells us something else:

The spell of number! Humanity appears to be possessed by the Devil. This may be closer to fact than most realize. And if that is so, as I believe, then humanity cannot save itself; only Divine Intervention can help us.

Thanks to USAGOLD for creating and maintaining this Forum!

To all readers: may you enjoy a peaceful and restful weekend.

Sierra Madre

auspecNetking And The Silver Sops#5903408/04/01; 11:01:03

Sounds like something on MTV, no?
Murray, per your recent post #59021: "Silver is a very, very small market {compared with gold}, however the short position and leasing is much greater for its size than that of gold or any other commodity we could compare it with."
I really have no reason to doubt this statement, but would love for you to expound on it a bit, especially in relationship to the sise of the silver market vs the gold market.
The gold short position is likely in the vicinity of 15,000 tons with CB overall holdings {as far as we know} at 32,000 tons. How does silver 'quantify' in relationship to these numbers?
Both David Morgan and Ted Butler do a great job of documenting and investigating the silver manipulation. The supply/demand numbers have been out of kilter and analyzed for all to see clearly since at least 1993 with Jim Blanchard's "Silver Bonanza" was put out. The manipulation was unapparent at that point, however. It is mostly guilt by association including the silver manip with the gold manip. Very grateful for the PE giving away their hand and letting us in on a major accumulation.
By the way, GATA has, at least informally, acknowledged that silver is being held down also. They are simply super-focused on gold, which is the path to success in any endeavor.
Timing? Who really knows how much above ground silver is left? I intend to be there to find out whether it is 1 month, 3 months, 3 years or even longer. I am staying super-focused in this field until the inevitable happens, they can stretch the rubber band as tight as they want!
Kind regards,

PeteTHE NWO REVISITED#5903508/04/01; 11:44:53

What determines the POG? If it was determined solely by its industrial uses and beauty in jewelry, coins, etc., the POG would be minimal. IOW's, much less than the present presumed low price as production would more than meet the demands exerted for these uses.

The next question to ask is who benefits the most by owning gold? Is it the ordinary speculator(goldbug) hoping to make a killing in the market at some future date? If this was true he has been sorely disappointed for decades. Is it a consortium of large speculators that might desire to corner the market? I doubt that any consortium would be stupid enough to buck the power of governments and CB's. It would be more beneficial for them to cooperate.

AGAIN! IOW's! In spite of its usefulness and beauty, NO ONE NEEDS A SINGLE OUNCE OF GOLD. That is no one save the preeminent currency of the world......THE DOLLAR(chosen by the nwo). What is in the best economic interests of the USA(NWO champion) is what determines the POG.

And exactly what is in the best interests of the USA? A continuance in the strength of the dollar making it desirable for other governments to continue to hold and trade in dollars. But wait! How can the dollar maintain its strength in the face of ever increasing money supply and at the same time declining interest rates? An unexplainable conundrum that does not compute.....UNLESS!

The only logical conclusion is a conspiracy(consortium) of the worlds major governments, CB's AND OPEC that have agreed to keep the dollar as the worlds reserve currency of choice by cornering the worlds gold market. Otherwise why would OPEC, major governments, CB's, etc., continue to hold and trade in a currency that is being devalued constantly(at least outworldly) unless they knew something the ordinary investor doesn't?





CoBra(too)Re- Darkhorse - Hello to you - too#5903608/04/01; 11:59:00

And yes, that is what TG/FOA/A said all along.

And as I've been a bit of renegade, luckily picking up some unencumbered gold in the ground, which has helped me lately to expand my physical - see ABX/HM as an example - I still feel with the kind of risk/reward and the right vehicle we'd be in a position to "petition" ;-) to 'claim' our right to the deep storage gold, we've paid to develop.

If not, bigot as it may seem, the mainstream media may scream (one future day, why didn't you say that the decay of honest reporting was just a delay of us catching up with the fact), that the BLS #'s are BS at best ... and we all know the rest!

And as TG sees the FRN as an apoplexy in waiting - I can't wait to see the POG starting out of the gate ... nonplussing, even the referee. And a referee is out there, with the euro cleaning the atmosphere of the hegemony of 'laissez faire' reserve money, backed by the same, a game which was called to explain! - Yes to explain, an refrain to the monetary printing game, to AG's shame as how to prolong a scam, after it was called a scheme all along.

Why, consider - and don't be bitter - that our US friends have been at the receiving end of this accumulation of debt trend.

I, personally, feel the US consumer, maxxed out as he seems, deserves by any means the fate the state has reserved for the sheeple, still people, who wanted to take care of their social responsibilities ... are now cheated out of their life-long labors and savings - since applying the same to an ongoing monetary game - where gold coin shavings, are akin to usury of an amateur.

... and any more day, keeping up the charade will erode the Grand Canyon ever more - to the FRN Death Valley - of yore.

Hope to see you - across the valley - with some gold in your pocket, forget Davy Crocket and decide for you -
Best cb2

R PowellSolomon Weaver/ Silverbugs#5903708/04/01; 13:50:25

Solomon posted a nice list of web sites (59022) yesterday for us to explore. Thanks Solomon!
Maybe there will be something there too, to rejuvenate auspec's Moxy and Mo-Jo. I must confess to feeling the same lately which usually leads me to ask for more/new info.
Jesse Livermore once said that it was his waiting that made him the big money. Being positioned and then waiting- patience. Imagine how Ted Butler must feel?
Hopefully the World Silver Survey 2001 will provide some insight into a good guesstimate of total silver stores (above ground) at a certain recent time/date. Then we subtract the monthly deficit until we reach the "That's all folks" date.
When feeling blue, remember that the silver leased and sold to hammer POS down game ends when above ground stores run out. Even "Deep storage silver" won't help the shorts when industrial purchasing agents call for just-in-time deliveries. Soon, I think.

NetkingAuspec / Chris Powell#5903808/04/01; 14:13:49

McAuspec(59034)We aint got MTV here PTL!, the biggest challenge is getting my perfect daughters to let me use my own computer to access the USA gold forum!

Comparitive short positions: I'm trying to see what current numbers I can dig up on silver(pardon the pun). Analysts generally believe that in terms of short sold gold/silver as a percentage of "above ground" inventory on hand the silver short situation is certainly more acutely severe yes. This is the way we must measure I think rather than the physical size of the short itself.

The greater the percentage of the former, the more "violent" will be the market pricing response on the day of reckoning. I believe Rich's statement is correct, one day it'll be . . . "That's, that's, thats all folks!" I've got my ticket . . .
Chris Powell(GATA)- Sir, Goes GATA have any up to date information that you have come across in relationship to silver and manipulation thereof or of general interest to silver bugs? Thanks in advance.

Black BladeSource Could Double U.S. Natgas Supplies#5903908/04/01; 18:33:12


WASHINGTON (Reuters) - There could be a backyard solution to the Bush administration's energy woes in the form of frozen natural gas deposits with the potential to double U.S. natural gas supplies, if consumers can just wait 50 years. The good news about the supplies, called methane hydrates or flammable ice, is that they are plentiful. The U.S. Geological Survey (news - web sites), the arm of the Interior Department charged with sizing up the country's oil and gas deposits, says hydrate supplies could be 300 times bigger than all other conventional U.S. natural gas supplies. The bad news? The bounty is frozen deep beneath the ocean or Arctic ice, and could take more than a generation to excavate. Methane is formed by the decomposition of vegetable matter and takes a solid form under extreme cold and pressure. ``It looks exactly like dirty ice,''

Black Blade: Eventually a potential solution source for our energy needs. However, when brought up to the surface, the reduced pressure and higher temperature makes the extraction problematic.

lamprey_65Gold Weekly (because I only post about once a week now!)#5904008/04/01; 18:43:53

I've learned to despise short term gold predictions over the past few years - however....

The super low open interest in the COT has my ears up.

Is that a gold rally train I hear comin' round the bend or just the dollar falling off the cliff?!

Chris PowellReply to Netking on silver#5904108/04/01; 19:12:46

Netking, GATA has not collected information about silver, though of course we have followed with great interest Ted Butler's writing and suspect that he is right. I recommend the brilliant work of Hugo Salinas Price, a Mexican businessman who has advocated his country's remonetization of silver as a matter of regaining national sovereignty. For what it's worth, I think silver is money too. Hell, it used to be, and some of us find it as lovely as gold, and with even more industrial uses.
WaterboySunset Industry#5904208/04/01; 20:17:47

Black Blade and All

Wall Street Journal
July 30, 2001

Oil Giants Struggle to Spend Profits Amid Shortage of Exploration Sites


In May, reporting on the first quarter of what may ultimately be its most successful year ever, Royal Dutch/Shell Group said it was pumping out about
$1.5 million in profit an hour and sitting on more than $11 billion in the bank.

It's a big problem.

Shell, like other major oil companies, faces an odd predicament. While energy prices have eased somewhat recently, the sustained surge of the past two years has brought piles of cash and pressure from shareholders to put it to good use.

But spending money isn't easy for big players in the oil industry these days. Shell has used some of its bounty to trim debt and buy back stock. It has tried to acquire other companies, with limited success. The major oil companies would love to put the ready cash into developing elephantine oil fields, but few of those remain. With about 90% of the
world's oil supply controlled by government-owned entities, publicly traded companies are finding it hard to expand their energy reserves. Economic sanctions ban U.S. companies from some of the world's biggest oil states, such as Libya, Iraq and Iran. From Dry Holes to Tap Water.
Meanwhile, oil production in established areas, such as the U.S. and the North Sea, is in a sustained decline. Less mature discoveries in Indonesia and Nigeria lie in hotbeds of political turmoil. Relatively new areas of exploration, including the Caspian Sea and offshore Brazil, have so far
offered more challenges than rewards. And some older regions -- Venezuela, China and the former Soviet Union -- continue to fall short of expectations.

So Shell is preparing to pour billions into a project that is as much about producing tap water as it is about energy.

In June, Shell joined six other oil companies including Exxon Mobil Corp. and BP PLC in signing on to a $30 billion project to build a series of water, electricity and petrochemical plants in Saudi Arabia, the world's most productive oil state. Not only is the project contrary to these companies' underlying business, but if they happen to find oil, they have agreed to give it to the Saudi government. Though natural-gas exploration constitutes a modest slice of the project, the companies can't export what
they discover.

Questioning the Profits

That companies in the business of producing energy would agree to such restrictions says much about the oddly depleted and barren nature of the modern oil industry, even as it chalks up record profits. Though the companies involved say they hope to make at least a 15% profit in the Saudi kingdom, that hasn't been guaranteed, and the payoff will be a long time coming. Some observers say they don't see profits at all, given the nature of the job.

Even if profits don't materialize, the projects do offer one attractive opportunity: A place to shove billions in cash before shareholders start complaining about cash reserves. The Petroleum Finance Co., a Washington, D.C., consulting firm, says the industry is sitting on nearly $40 billion in
cash, and the figure is likely to balloon in coming months.

Though energy reserves are rising world-wide, the big oil companies have been hard-pressed in recent years to increase their business substantially the old-fashioned way, by scouring the earth for new discoveries. Despite technological advances, companies in recent years just haven't been able to find many large, profitable fields. "If the industry had the projects, this money would be spent," says Larry Andersen, a vice president for Texaco Inc., which is based in White Plains, N.Y., and is in the process of being acquired by Chevron Corp. "But there's not a lot of opportunity."

No Impulse Shopping

Still, investors may be gratified to hear oil companies aren't duplicating the moves of boom times past. Go back to the mid-1970s when the price of oil skyrocketed and companies were swimming in cash. Mobil Corp., before its
merger with Exxon, purchased the now-defunct retailer Montgomery Ward & Co. Occidental Petroleum Corp. bought Iowa Beef Processors Inc. and went into the meat-packing business. Gulf Oil Co. -- subsumed long ago by Chevron --
made a pass at buying a circus. Even conservative Exxon embarked on a $500 million scheme to produce office machines -- and took a pounding. All of them received a tongue-lashing from Wall Street for straying from their area
of expertise.

With the good times rolling again, companies say they are focused on their core businesses and committed to capital discipline. Shell, for one, says its capital projects will work even if oil prices drop to $14 a barrel, or about half of what they are today. Exploration budgets, which tend to swell during times of plenty, are growing, but slowly. This year, Exxon Mobil plans to spend about 20% more than the $11.1 billion it spent last year on capital projects. Typically, oil exploration accounts for a majority of this

Instead of spending wildly, the majors have turned to buying back their stock. Exxon Mobil spent $2.35 billion to buy 54 million shares in 2000 and spent a further $1.44 billion buying back 35 million shares in the first quarter of this year. It barely made a dent in the cash hoard: As of this
month, Exxon Mobil has $9.3 billion on hand. Similarly, Shell spent a record $4 billion in just the first quarter buying its own stock, yet when the quarter ended the company was sitting on $11.68 billion in cash, 182% more than a year earlier.

Stephen Hodge, Shell's finance director, says the cash stockpile isn't a cause for concern. "The reality is that this is a hugely cyclical business," Mr. Hodge says. "At the top of the cycle, it throws off money like there is no tomorrow." Mr. Hodge said Shell will maintain spending discipline, though he notes that "we also don't want to miss opportunities that won't come back." He calls the stock
buybacks a "safety valve" that prevents too much cash from building up.

'Production Replacement'

At a recent stockholder meeting, Exxon Mobil Chairman and Chief Executive Lee Raymond noted how tough it is to find exploration projects big enough to expand reserves. Indeed, Exxon Mobil needs to find 1.6 billion barrels of oil a year -- the equivalent of three world-class fields -- just to make up for what it takes from the ground. "The challenge
is production replacement," says Harry Longwell, Exxon Mobil senior vice president for exploration and production. "That's becoming more difficult."

Though the company found more oil than it sold, Exxon Mobil's natural-gas reserves fell 5% last year. Shell had a harder time of it: Both its oil and natural-gas reserves fell slightly last year.

The easiest way to boost reserves is by acquiring other oil companies, as Exxon did when it bought Mobil in 1999 for $81 billion. Similarly, BP underwent dramatic change after buying American companies Amoco Corp. and Atlantic Richfield Co. around the same time. Those deals made BP almost the size of Shell, which three years ago was by far the largest
publicly held oil company in the world. Shell, whose corporate structure makes stock acquisitions difficult, sat out much of the recent industry consolidation. It's now smaller than Exxon Mobil, which is based in Irving,

This year, Shell failed to clinch a $1.8 billion hostile takeover of Barrett Resources Corp. Subsequently, Shell failed to win Australian government approval to buy Woodside Petroleum Ltd. for about $5 billion. An easier target for Shell's cash may be the Saudi project, though it will
probably cost as much as Barrett and Woodside combined. The project's size and location offer prestige. And the companies hope it also offers entree into the kingdom's oil reserves -- though this may be wishful thinking. With the cheapest production costs in the business and ample spare
capacity, the Saudis clearly don't need any help getting their oil to market -- and have told the companies as much.

The Saudi project offers one further attraction: It appears to dovetail with the oil companies' core business in a way that catalog stores and circuses never did. When pressed, though, companies such as Occidental concede that the project is more about civil engineering than energy exploration.


serious implications about the future of oil.


WaterboyMethane Hydrates as Alternative Fuel#5904308/04/01; 20:54:46

Black Blade and All

The prospects for Methane Hydrates as an alternative fuel are not attractive.

Unless you have a terrific interest in Methane Hydrates, suggest you scroll down to near the end of this long piece and read 'Conclusions', and 'Prospects for Future' only.


Black BladeRE: Waterboy - Hydrates#5904408/04/01; 21:55:24

Methane hydrates are definitely a "long term" play - a vvveeerrryyy lllooonnngg term play. The technology does not exist today to economically exploit methane hydrates - if ever. Cheers!

BTW, I don't remember you here before, even so - welcome to the "Round Table."

- Black Blade

Black BladeEnergy Crisis and Economic Recession#5904508/04/01; 23:03:24

When anyone mentions the energy crisis people naturally think of oil. The world is consuming about 77 million bbl/day. If every oil well in the world, including marginal and uneconomic wells, and even every known stripper well were operating to produce oil, then only about 80 million bbl/day would be produced. That is only a 4% excess capacity whereas 15 years ago we had a 25% excess capacity. The World really is running short on oil.

The real energy crisis that we face right now is not about oil. Oil is in short supply, however, the real crisis is the shortage of energy - electricity. Oil provides only spittle of the fuel for electricity generation. There are very few duel fuel electricity generating facilities. Virtually every new and planned power plant is NG-fired. There are nearly 300 new power plants scheduled to go online by 2006.

The demand for electricity will continue to grow and will eventually outstrip supply. The fact is that there has been little interest to build new power plants as people have been complacent and take energy for granted. Every postwar recession has been preceded by an energy crisis, including this one. This energy crisis is different as it is more pervasive and the result of fundamental supply and demand and not the result of some political reaction such as the Arab Oil Embargo or the overthrow of the Shah of Iran.

The Internet alone consumes about 8% of all electricity and PCs consume an additional 12%. The "New Economy" is consuming electricity at an alarming rate. There are also new "Server Farms" being build nearly every week and they consume a lot of energy. This energy crisis is slow to hit the markets and it continues to build momentum even while unrealistic childish extremists resist the need to expand energy production and upgrade the energy grid. It is "Cheap Energy? That has fueled the Great Bull Market of the last 20 years. Those days are over.

Natural gas remains 2 to 3 times higher and production has not increased in spite of growing demand in a very weak economy. We need energy and the low prices of the recent past did not encourage anyone to increase capacity. We will see continued high prices (and going higher) until capacity is expanded. This recession should continue for a minimum of another 5 years and most likely several years longer. It takes many years to build up energy supply and electricity generating capacity. Add into the mix of few experienced workers, shoddy infrastructure, and the lack of drill rigs - and the future is clearly a bleak one. This recession is slowly picking up steam (the slow burn).

The lack of "Cheap Energy" to fuel the Bull - the Bear will feast on beef. There is no room for expansion as there is no more available excess energy. This means that this current recession will only get worse as corporate earnings continued to get crushed going forward. The result is that investment portfolios will also get crushed. Gold and silver are traditional "Safe Haven" portfolio insurance holdings that should be in everyone's portfolio.

- Black Blade

Black BladeHedging losses cost Durban Deep dearly #5904608/04/01; 23:18:42


Non-cash items pushed Durban Deep into a loss-making position of R1.8-million before tax, but a tax credit of R7.2-million gave a net R5.4-million after tax but before extraordinary losses of R112-million - principally because the hedge book was further restructured and a R135-million knock was taken below the line. Wellesley-Wood says: "The cost of our hedge book is totally unacceptable. By comparison, if Durban Roodepoort Deep had received the spot gold price for its gold, its cash operating profits would have been R175.6-million higher." He says the book's restructure has become the utmost priority. The benefit of writing off the long positions went straight to the bottom line in the June quarter, giving a margin of $30/oz - the received price of $258/oz was $10/oz below spot because of forward positions.

Black Blade: Forward sales bite another hedger in the a##!

abudahhabTo FOA and Another - many thanks!#590478/5/01; 01:40:02

FOA and Another,

Again, thank you for the great series postings over the past few days. I'm so pleased that you decided to stay on the Trail with us. It is critical that readers glimpse past the historical dollar pricing mechanisms towards the coming new reality. Gold has been the great store of wealth for the ages. Its current dollar value and availability is pure fiction.

You are indeed correct that without stability in pricing, the Dollar settlement system will rapidly fail. Greenspan and his Fed now openly talk of mass monitization of non-Tresury $US denominated debt at the Discount Window and the complete elimination of reserve requirements for commercial banks. All this while money supply growth "officially" tops 20%.

The arrival of the Euro, the revival of the Chevornet and the liberalization of gold trading in India and China jointly consitute a formidable challenge to the $US. Now, the US is no longer able to create an unlimited amount of fiat dollars to pay for goods and services around the globe. The great US credit inflation of the past 30 years is about to priced adjust all US goods and services. An execise of catch-up; the great mark-to-market of the dollar world. The Dollar must now compete against the Euro and free trading gold. All this at a time when the country's cumulative debts can only be serviced through massive and endless monetization.

In the aftermath of the 1930's, American politicians promised its citizens that they would never have to suffer through another deflationary depression. The coming hyperinflation should be seen as proof that these politicians have kept their promise.

Best regards,
abu Dahhab

Netking"War in 2002" - Israel #590488/5/01; 04:18:49


Israel has assessed an increasing prospect of a regional war next year.Israeli sources said military intelligence has drafted a report that warns of the increasing likelihood of regional war in 2002.

The report said the war could be sparked by either an Israeli offensive against the Palestinian Authority or an escalation in tension along Israel's border with Lebanon.
We'll see if things last until then, many would say before Christmas . . .
- Netking

BelgianGreat WE post from all.#590498/5/01; 06:17:36

Candidate ECB-er Trichet (France), made another € -"Stability" statement on friday. This repeated stability-obsession is an indirect evidence for most of TG's visions.
In a global economic contraction, a lot of energy is spend on creating the right environment for the US$'s rival...a strong €. It must be that the facts about the dollar's weaknesses are well known and covered for reasons of appropiate surfacing-timing as strategic element in the €'s management !

Rich, (59037), what new/more facts do you need Sir ?
The most heavy fundamental ($/€) is being subtly stressed on permanently, only to be understood by the ones who do have "the" vision on things to come ($'s replacement as reserve).

All dollar holders still have to realize that they have been putting themselves at the receiving end of debt-trap.
Yep CB2, very nicely said ! Doesn't matter if the debt-trap was intentional...responsible people/savers, are permantly cheated (depreciated) and will suffer the most (as usual).
The "that's all folks", reality-acceptance, is still very far away. Darkhorse's English hasn't left him...quite the contrary. The toal amount of REAL GOODS production, gets it more and more difficult, to compensate for permanent and increasing paper depreciation. Very visible in the welfare-europ arena. Less visible in the debt-dollar-arena. The basic problem (cancer) = increasing artificial creation of economic activity with hyperconcentration and compensenting productivity is running completely out of proportion with all natural elements of economic exchange and expansion-rate. Simplier : they "all" want it "all" for "less" and they want it "now". This outragious greed, inevitably ends in sheer panic. As Denial, evolves into acceptance and capitulation. We don't need lots of figures to evidence this. Common observation is the real evidence, available behind each corner. Said in other words by Sierra Madre (59033) with the all in word : * PAPER * !
And these observating responsable ones defined by Pete (59035) as " anyone with an ounce of common sense ".

Not if, but when the US$-reserve is allowed (prepared to) to go in search for its depreciated value...I'm convinced that global expansion can re-start on a fresh new basis.
Global producers of necesarry tangibles will re-oxygenate from the past dollar suffocation. Kind of re-balancing and more honest, incentive trade and exchange of goods.
The hyper-concentration of the dollar power, holds the essence of its relieving decay . Is it reason or effect of the € > $ challenge ? Probably a bit of both.

The Gold-Drama has the pivot-function, helping the transition, to that other prospect of renewed expansion.
There is (was) no other universal tool for temporaray "FAKE" dollar-valuation. And any consortium of Dollar (NWO) supporters have the slightiest chance to perpatuate the metastase (dispersing) of the dollar cancer.
Because that particular paper, respresents less and less.
Evidence : OIL ! Another universal standard valuator !
For this reason we don't have to go out and count (account) all (global) real tangibles against the paper-mountain.
Oil valuation is doing this for us. And don't count on an oil alternative to show up as ultimate saver ! These alternatives will only become valuable when POO goes in the hundreds of dollars ! Oil and other energy-sources owners/producers, do see and realise that prosperity is completely dependent on their product and the tax (75%) that is generated on their product ! They increasingly want a bigger share of this vital global element as soon as geo- politics are in place (opportune) for them to demand so.

That's why Gold remains the "sleeping" Giant. Only to be awaken by the thundering of collapsing confidence in the manageral skills of the present geo-politico-rulers.
Muslim fundamentalism might weaken the (past) reasonable western relationships. The dollar-might is already frustrating ( Muslims/China/Russia/Europ) for quite a while. When frustration evolves into strong selfconfidence...beware ! <?>

CoBra(too)Words of Wisdom from Bill Buckler#590508/5/01; 08:35:16

- Predictive? - In any case I find. The conclusion of the Privateer's latest weekly gold update:

We don't know whether this facade will crack with the release of the "productivity numbers" on August 7, or whether it will be the release of some other statistic that does it, or whether the capacity of illusion will simply prove unequal to the situation. We do know that the present situation is NOT sustainable.

If Gold was going to be hammered back towards its ulitmate support levels around the low $US 250s, it would almost certainly have happened by now. If the facade of U.S. economic "growth" is about to be ripped aside, then Gold has literally nowhere to go but up

Yes, it takes patience. Illusions die hard - always. But console yourself by realising that right now, physical Gold is the safest investment there is. And it will get a lot safer once the illusion of economic prosperity through borrowing is finally cracked, however that crack ultimately takes place. -unqoute

Not much more to add ... regards CB2

slingshotBlack Blade #59026 Sierra Madre #59033#590518/5/01; 08:59:47

Good Morning Everyone,
The two posts above triggered the Gray Matter to the think mode and the readouts from my CP may add another piece to the Golden Puzzle.
All this information from around the world and it still comes back to the Stock Market Crash. Either it be the Crash of 1929 or the one that looms in the future.
Sierra Madre, had some interesting comments in his post and appears he thinks there is more to it than what meets the eye.
There has been a vast amount of time discussing the statements of various Talking Heads of the government,banking and other institutions in which I include the News Media.
When will the spell be broken? When will the crash come? There is a link to these questions. More Important is to ask why?
My answer is, Those who fail to remember the past are doomed to repeat it. We have all the books on this subject but who reads them. If they have no idea of the consequences
of todays market, why should they prepare for a disaster in the market.
We have at in our mists a great pool of information available to us. First hand accounts. People who now are in nursing homes. They were the children of the depression, wars and other hardships in the world. Their words would be Truth. Not Speculation! Funny how Toilet paper can be a Precious Commodity in hard times.
So where does the youth turn to today for advise?
If you think the Taking Heads, you can see how the Spell has been casts. As for the Crash? Guess it is back to the School of Hard Knocks.


auspeccb2 , Belgian and ALL#590528/5/01; 10:16:37

Cb2- Thanks for the regular posts from Bill Buckner's Privateer. His is one of the most discerning minds out there, and I miss his regular updates that use to be put out w/o subscription. I do take it you have a subscription, or am I overlooking something?

Belgian and ALL- In regards to the term 'debt trap', could you expound on this principal somewhat? You or I would never try to trap our brother-in-law by providing him with more cash than he can pay back, yet this is business as usual with the IMF gang. It seems so foolish as the one who never gets paid back is the one who should be considered 'trapped'. I guess the cost of printing money for loans is near nada, and the 'sphere of influence' gained by holding the purse strings keeps the plantation system intact. The dollar debt must also expand, according to inherent structure, in order to survive. As the Greenback arrives at its destiny ALL who hold same will be in a debt trap, no?
Got sufficient prosperity trap?

auspecKingston Trio#590538/5/01; 10:19:28

Here's an old and prophetic one:
"Well, I don't give a damn about a greenback dollar,
spend them as fast as I can"...........on precious

auspecKondratieff Cycle and Debt Traps#590548/5/01; 10:49:39

This is an excellent article at GE by Ursel Doran, who I have never previously read, but look forward to more. HE delve into answers of my own questions about 'debt traps'. Guess the timing is nearly right. CYCLES!!
Cavan Manauspec#590558/5/01; 12:00:43

Great link. Thanks.
R Powellauspec#590568/5/01; 12:17:25

because a whawling song and a good guitar
the only things that I understand
Oh boy
the only things that I understand.
early Kingston Trio
good music!

Buena Fefairy tales#5905708/05/01; 13:38:00

WS/FED/TREAS are going to go down kicking and screaming!! Here is another piece full of their drivel, it's sad how mind-numbed most westerners are. They will hold on tho their $ illusion all the way to the bottom.

08/05 10:32
Slowdown Keeping on Lid on Profits, Inflation: U.S. Economy
By Vincent Del Giudice and Terry Barrett

Washington, Aug. 5 (Bloomberg) -- The U.S. economic slowdown has dampened the threat of inflation and that makes it easier for interest rates to decline, analysts said in advance of Friday's report on prices paid to factories, farmers and other producers.

The producer price index probably fell 0.3 percent in July after dropping 0.4 percent in June, according to a Bloomberg News survey of economists. That would be second consecutive monthly decline and gives support to Federal Reserve policy makers if they see a need to lower borrowing costs at their meeting this month...............


.............With the economy in low gear, the strong dollar keeping a lid on import prices and unemployment up from last year, companies have reported the biggest drop in quarterly profits in 10 years.

``The constant drumbeat of troubling news on corporate profits suggests businesses can't raise prices,'' said William Sullivan, an economist at Morgan Stanley Dean Witter & Co. in New York. ``Inflation for the foreseeable will remain benign.'' ...........


...........That sort of news clears the way for the Fed to lower the benchmark overnight bank lending rate for the seventh time this year to provide a kick for the economy. Economic growth slipped to an annual rate of 0.7 percent in the second quarter, the slowest in eight years...........


BelgianThe DEBT Trap (Auspec)#5905808/05/01; 15:38:20

Sir, if you enjoyed U. Doran...go and pay the boys of Colorado long waves a visit. They are heavely Kondratieff involved. And stone good in their field. The Doran article "is it" imvho of course.

Debt in a nutshell. More precisely "Unproductive" Debt.
The bulk of necesarry defaults / write offs / debt destructions, are not allowed to take place. Defaults are causing deflation and contraction. Debt is soooooo big that a little default heat can't melt the monstrous iceberg anymore to a manageble size.
All debt has to be rolled over and covered with more and new debt as to avoid any slow down in growth, wich becomes more and more artificial. State welfare is also a creation of debt. At first the distributed money is recycled for a major part, by taxing the actives. But the hand out benificiaries just keep on asking more and taxing has reached maximum levels. Than the money machine starts printing and all is done to avoid price inflation.

All interest rate on debt is additional debt and when total debt varies between 60% and 120% (average 100%) of GDP and economic growth is 3 %...the debt servicing with 6% is outstripping growth by double the amount (6% versus 3%).
More and more debt is absolutely necesarry to service the previous debt and to keep the artificial economic growth going.

The more debt is accumulated, without default, the easier it becomes to make more debt. The creditor just keeps on creating chances to recover part of what has been lend. In vain of course. He/we/they are all trapped.

When that vast amount of debt is not counterbalanced with certainly guess by now what will happen.

This vicious circle is already spinning for at least 30 years in increasing momentum. In the eightees, high IRs and soaring POG signaled that it really got out of hand.
The masters got together and decided to do something about it. And they managed to "talk" it down and took all warning signals from the radar (interest rates and gold). It worked ! That's why everybody is so complacent. We made it happen ! Full control ! Your brother in law kept his job and you lowered his debt-servicing rate and gave him another loan. You never saw (or will see) the principal and you live on the interest income on the debt that you provided to sooooo many others. Cheers !

All types and kinds of debt are running in that same one way street...downhill, faster and faster !

Debt isn't going to be repaid and not written off. Something drastically has to happen to stop and restart this infernal circus. Time and time again, I'm asked on the breaking point on this chair dancing. When does the music stops ? The music is (was) the dollar and the band is going to play another song, an Euro song and that's why he's (the $) running out of time . Hyperinflation will take the old chairs away and replace them with others. Gold will signal clearly to everyone when the music risks to stop. A brand new debt and mismanagement warning system ! IRs will be stabilized later on. Past debt(berg) will be melted to a much smaller size . But don't know how. What about a Gold dollar and a debt dollar living alone together ? Or something like that. Who knows ?

Note that we even have no idea of total global debt standing out. The known figures are already disastrous enough. Global management is happy when debt-growth is slowing. But when economic growth slows, even a stable debtberg becomes a problem, because of contracting liquidity. Some debts are paid back partially with the sale of unnecessary assets. That means that the ship is making water. cfr. Japan !

Goldphiles are not that familiar with debt. This attitude isn't part of their profile. Maybe the reason that we underestimated the enormous impact of it to be reflected on the dollar as most widely holded debt currency.

LeighBelgian#5905908/05/01; 16:41:27

Dear Belgian: When do you see the hyperinflation beginning? Do you see it as a slow process, or might a traumatic event set it off? It seems that half the posts on the gold forums center on the subject of "when," and I wonder if you have an idea of the chain of events that might get all this going.

Thank you!

NetkingThe week ahead . . . #5906008/05/01; 17:53:04

. . . promises to be a good one, no time for slumber in Netking zone.
auspecAn Unproductive Debt Free Belgian#5906108/05/01; 18:20:06

Thank you, Sir, may all your debts be productive! So we see that a debt trap can be a crony capitalist's best friend, fraudulent use of public funds, bailed out by Jane and Joe.
Ed Steer recently made commentary in regards to derivatives and their relationship to debt:
"....for all the most highly leveraged financial institutions, these problems can NEVER BE FIXED!!!! These morons are going to die with their boots on. The lunatics ARE running the asylum!!!!" Thank you Ed, for gently laying that out for us to ponder. What Ed fails to take into account is twofold. 1- The financial wizards have computers that reach to nearly infinity. 2- These clever folks can simply suspend the laws of economics, and by edict ban various cycles that interfere with their utopia. Who needs commodities other than paper? Kondratieff, back to Siberia with ya!
No, sorry, in the long run the toilet needs to be flushed. A systemic collapse is what will be required to purge the stench of 30 plus years of economic experimentation and manipulation. It is not nice to slap the invisible hand of the free market!
So the game continues to the inevitable end because the throttle is locked down at maximum speed. Turning back merely hastens the ugly finality that approaches. The big question is.....Was this fiasco perpetuated on the world economy done on purpose, or out of sheer stupidity and arrogance? Very likely a blend of all 3 factors. You can bet that the plans have been layed, and recently tweaked at Bologna, to implement the big GRAB once 'Winter' arrives. A grab of power primarily, but also of anything not fully secured. Make sure you're fully anchored!
Belgian, the K-Winter clearly calls for debt deflation, forgiveness or write offs. Now we must plan for monetary inflation/hyper/inflation at the same time, yes? It can be no other as a leopard doesn't bleach his spots. Gold is quite happy during K-Winter, clearly. These megalomaniacs could have chosen to defend $400 POG instead of $290 and then $266, but no, let's try to see if we can't make this VW into a space shuttle, way more 'Challenger'{ing}, and the crash will be much more entertaining. Besides, we control 99.999999999999% of the airwaves and public opinion, the unwashed will beg us for 'solutions' before you can say K-WAVE.
What can we do about this? Vote, drink Coke, see your Proctologist regularly, call me in the morning.
What, me Worry? Got plans this winter?

USAGOLDMyths & Realities about Gold . . . The ABCs of Gold Investing#5906208/05/01; 18:52:31

Note: I decided to reproduce the "Myths & Realities" chapter out of the ABCs book for the current issue of News & Views. In re-reading it, I was pleasantly surprised how well it has held up over the years (the book was published in 1997). Please excuse any typos you might find. I scanned it and George Cooper has not edited it yet. Those of you who invest in gold stocks, please note that I am not condemning them as an investment -- just recognizing that they are different class of investment subject to a different set of standards than gold itself is -- a speculation as opposed to an hedge or insurance against monetary disorder. Please keep in mind that this book was published long before the problems at Ashanti, Cambior, and other hedged producers, including some of the majors, became general public knowledge. I have been asked many times if I intend to update the book. I've thought about it but wonder when I see how the central ideas have withstood the test of time, I hesitate.

If you are just getting started on gold and would like to read the ABCs of Gold Investing: Protecting Your Wealth through Private Gold Ownership I believe you can to the ABCs page through the Home page and follow the links to the on-line order form. The starter link is above.

I want to thank all of you who post here on a regular basis and spend the time to make this forum important for so many visitors. Let the discussion continue. . . . .I will be around tonight if anyone has a question.


Gold has its critics. Yet most of their criticism is ill founded and amounts to little more than good propaganda for those who fear strong gold demand will divert investor interest from the equities markets and the dollar. You have probably heard or read most of the standard criticisms. Here are concise and complete rebuttals—the last words on the merits of gold.

Myth: Gold is not a good portfolio item because it doesn't pay interest.

Reality: That gold does not pay interest is its greatest strength. If gold were to pay interest, it would mean the return on your gold and the return of your gold would be dependent on the performance of another individual or institution. This, of course, is the case with paper assets such as bonds, bank certified deposits, even stocks. The contractual relationship between the creditor and debtor can be a paper asset's greatest strength. It can also be its greatest weakness. An additional and often complicating factor is that paper assets are directly affected by the performance of the currencies in which they are denominated.
Gold, on the other hand, is a stand-alone investment independent of government largesse or the performance of another individual or institution. This is gold's greatest strength. Even though gold does not pay interest directly, as its critics claim, it is interesting to note that over any extended period of time the interest rate of currency becomes imputed in the price. During inflationary periods the appreciation in the price of gold is the greatest, and so is the rise in interest rates. During deflationary periods the gold price tends to stay flat while interest rates plummet. Gold historically seeks a price level that takes into account the inflation rate of currency. This compensates for its non-interest-bearing status.

Myth: Gold stocks are a better portfolio option than gold itself.

Reality: Gold stocks are stocks first and gold second. This is an important distinction lor investors to rccognize because, once it is understood, justifying gold stock ownership as a substitute for gold itself becomes very difficult. Owning gold stocks is not unlike owning other types of stock. As a mattcr of fact, in the last three stock market crashes—1929, 1935, and 1987—gold stocks also tumbled into the abyss, belying claims by stockbrokers that they can serve as a hedge against disaster.
In addition, you could presumably own a gold stock during a period of rising gold prices and not participate in the uptrend simply because a company had diminishing prospccts in the eyes of the investment community. Another problem with gold stocks in the 1990.s is that many mining companies have sold several years of production forward as part of their mine financing programs. If the price of gold rises, these companies could be excluded from the bull market because they will have already sold their production forward at prices less, even considerably less, than the current market rate. Gold stocks are not an investment in gold. They are simply another stock market investment and should be analyzed as such. There is no substitute for owning the real thing.

Myth: Gold is just another commodity, like pork bellies.

Reality: Gold trades on the commodities exchanges along with pork bellies and the other commodities, but here the similarity ends. [Unlike other commodities, which are procluced strictly for consumption, gold is the only commodity that is accumulated and saved. It is also the only commodity used as money to facilitate future consumption. Most of the gold ever produced still exists today. You cannot say the same thing about pork bellies, .soybeans, or sugar. The gold you might someday purchase could very well have been part of the treasury of Rome, or used by Marco Polo in his first vi.sit to China, or circuIated as currency in the Old West. This money (asset preservation) function of gold separates it from thc commodity complex and gives it a special place at the very top of the value scale.
Those who relegate gold to the status of "just another commodity" usually do so because they either fear gold or do not like competing against it. By denigrating it, they hope to subdue public accumulation—an exercise in futility. Gold is the enduring commodity.

Myth: Gold is a "barbarous relic" of past monetary systems, irrelevant in today's computerized markets.

Reality: Gold is held as a reserve asset in nearly every central bank in the world. It serves as their asset of last resort, to be used for grave international crises such as war, economic troubles, environmcntal disasters, and the like. Former U.S. Federal Reserve Chairman Paul Volcker recently made these comments about gold and central banking, answering the "barbarous relic" claims:

"We sometimes forget that central banking as we know it today is, in fact, largely an invention of the past hundred years or so, even though a few central banks can trace their ancestry back to the early nineteenth century or before. It is a sobering fact that the prominence of central banks in this century has coincided with a general tendency toward more inflation, not less. By and large, if the overriding objective is price stability, we did better with the ninetcenth century gold standard and passive central banks, with currency boards, or even with "free banking. The truly unique power of a central bank, after all, is the power to create money, and ultimately the power to create is the power to destroy."

Other central bankers, including current U.S. Federal Reserve Chairman Alan Greenspan (See "Gold and Economic Freedom" above), have voiced similar admiration for this "barbarous relic." In lieu of an international gold standard, individual investors have been forced to place themselves on the gold stanclard even in today's computerizcd markets. Gold today has the same relevance it has always enjoyed. It is the asset of last resort and universal value for both individual investors and nation-states.

Myth: World governments in conjunction with their central banks control the gold price. They intend to hold that price down.

Reality: In each instance in modern monetary history when governments and central banks (including our own Federal government and central bank) acted to hold the gold price down, the price was on the verge of moving substantially higher due to inflationary policies these very same institutions were promulgating. Their activities to hold gold down amounted to exercises in futility, only delaying the dominant, underlying trend. As a matter of fact, government interventions in the gold market in the past (most recently in the 1960s and 1970s) have amounted to no less than solid indicators that the price was about to go substantially higher. Far from being able to control gold, to the consternation of some central bankers and governments, they too must answer ultimately to what the gold market is telling them. When it comes to currency value, gold is the master of all and a slave of none.

Myth: Gold is a speculative, volatile investment that should be avoided by conservative investors.

Reality: It is not gold that changes in value, but currencies. What you could purchase with an ounce of gold a hundred years ago you can purchase with an ounce of gold today. The reason for the spikes dominating the gold charts is not gold's volatility but, rather government and/or central bank intervention to suppress the price. Once market forces overcame the intervention, gold sought its natural level, which proved to be multiples of the interventionists' target range. Hence the spikes. If the interventionists had not acted to keep gold down, the chart would have shown a more gradual rise, and gold's critics would be unable to make claims of its volatility.

Myth: Gold is an unpatriotic investment.

Reality: It has become a small world. Investors now invest their money in economies all over the world. Is it unpatriotic for an investor to buy Swiss annuities, or a Japanese equities fund, or a South American gold fund? Would this be considered un-American? Probably not. There is also the question of whether citizens are obligated to lose everything they have holding a currcncy that is being systematically debased by the government and its monetary authorities. As I have shown in other sections of this book, the monetary policies of the United States virtually assure further devaluation of thc dollar in the future.
The world's central banks have already responded to these circumstances by substantially reducing their holdings of dollars, not too long ago the chief international reserve currency. No one knows the long-term outcome of such a transformation, but few who understand the problem feel they should go unprotected. Far from being unpatriotic, citizens who accumulate gold may be the exact opposite. They could very well turn out to be the country's most farsighted, devoted, and patriotic resource. Indeed, the fact that certain citizens have the wisdom to accumulate gold may someday turn out to be this country's saving grace. If the dollar were to fail, the gold accumulated in the United States by American citizens would become the capital base required for this nation to recover -- a thought worth pondering.

Michael Kosares is the founder and president of Centennial Precious Metals / USAGOLD and the author of The ABCs of Gold Investing: Protecting Your Wealth through Private Gold Ownership.

Copyright 1997 Michael J. Kosares. All rights reserved. No further reproduction without permission.

RockgrabberTo Sir M.K.#5906308/05/01; 19:07:02

TO Sir M.K.. Thanks for having wrote the A.B.C.s of gold, as I read that book to kick-start my knowledge of GOLD. Probably should read it again , but I am a bit haughty. Then at the end, I saw the U.S.A. Gold web-site listed, thanks. Now, ever from that time, I feel I am off and running. Thanks for the start, and probably the finish ( ANOTHER, and FOA's little scenario I am inclined to believe, as it makes the most likely sittuation I am living at this time).
USAGOLDSir Rockgrabber. . . .#5906408/05/01; 19:22:47

Thanks for the note. So many have started with The ABCs. Glad to see you here.

FOA and Another's true value is in the fundamental understandings they have imparted. We understand the world of international finance as a dynamic, not static, process because of them. We also understand from them that the world is in the throes of a fundamental shift in the post 1971 relationships. I sincerely believe that they are correct that the euro is the last leg in a long process of breaking away from the Anglo-American dollar/IMF power structure. I don't know where it will all end, but I am grateful that we have people posting here who understand the underlying drama and what it might mean to me and you as investors.

May the rocks you grab be filled with yellow metal, my friend. I look forward to seeing you here through the excitement to come.

Chris PowellAn exchange between The Mining Web and GATA#5906508/05/01; 19:54:04

An exchange between The Mining Web and GATA:

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you don't have to go look for them,
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TrurlCPM and IRAs#5906608/05/01; 20:02:32

Hello MK and USAGOLD

I have a question about the sorts of IRAs CPM offers. I am especially interested in Roth IRAs, since they seem to be a good bet if one expects assets to dramatically increase in dollar denominated value...

Does USAGOLD offer such things? It a segragated account, or a share of ownership of some sort of pool?

Like many lurkers, I have an intense interest in the give and take on your forum, but don't often have anything meaningful to add. I have an idea for the fifth horseman – OK to post?

USAGOLDSir Trurl. . .#5906708/05/01; 20:21:01

Unless I'm wrong, not knowing a great deal about Roth IRA's, you can invest in gold bullion coins if you like. We just have to do a rollover -- which the investment firms take care of -- make you fiduciary to the trust, and then you can invest your money where you want. Having said that, George Cooper is the guy to talk to about that. He's our resident expert on IRAs and his legal background makes him careful (which is what you want). He does this sort of thing all of the time. Call him tomorrow and he'll find out what you need to do. We don't like pool investments generally speaking, even if they are seemingly well-intentioned. Our advice would be to have the gold earmarked in your name and stored accordingly. That's called "segregated" storage. As I say though, I'm not an expert on this and don't know if Roth IRAs have special rules. You should talk to George.

I think we would all be interested in your Fifth Horseman. Amazed how that concept has stuck around. With Fall coming on, I'm starting to think about stocking up on some essentials. Just my nature I guess. I always do it and always happy I did.

What's this stuff about a crash on Tuesday that everybody is talking about? Seems kind of arbitrary to me, but I agree with the sentiment. The date might be wrong, but the concern is hard to quarrel with.

goldquestThe Federal Reserve, Petition For Articles Of Impeachment.#5906808/05/01; 21:47:42

Crooks then-Crooks now! Congressman McFadden wasn't able to purge these leaches, GATA WILL!
goldquest; 21:52:12

Sorry, try this one.
RockgrabberThis time frame seems reasonable, for the war, and gold. #5907008/05/01; 22:28:15

Gold takes off very soon, no? along with a war in the Mid-East, and intro of Euro Paper.

U.S.A. GOLD thanks for the kind words, and kind information. I will take a road trip to visit you this fall, as I feel bad for having not purchased an once of gold through you, and a large part of why I buy gold is due to you and others on this web-site, you have provided for those who wish not to be in the dark. Need not reply to me again, I just thank you. You know one day to come soon, you will be a hero. Not that that is what at all is strived for, but it is inevitable, from my eyes anyhow. Good luck on your soon to come fame. Just look at what you are doing and providing at a time when this is far from commom knowledge.

TrurlThe fifth horseman#5907108/05/01; 22:29:52

…As we join the scene, the four horsemen are encamped on a trail overlooking the big city. They are all alert and scanning the hillsides, on the lookout for the rumored fifth horsemen.

They have been on the watch for sometime, but are still alert for his arrival. Near noon, they see somebody famous riding up the trail. They take a break from their search to greet this renowned person. He, being a famous person, is used to the attention, but grins as they fall over themselves trying to be the first to shake his hand.

They are excited to see this person, since he or his representatives are often seen on TV, or quoted in the major newspapers. He is almost universally loved and respected. It is a well known fact that many people have gotten rich exploiting his investment style. Thus many, many folks love him for they perceive that "using" him is a shortcut to investment success.

After a short visit and a pleasant exchange of greetings, the four horsemen resume their vigilance of scanning for the expected new arrival, and the famous man makes to continue riding along. He actually rides a short distance, turns around, laughs, and says "well, I'm here!".

The four horsemen are confused, since the man in front of them is no stranger. They themselves have gotten rich "using" him. He again laughs and explains, "everyone thinks they ‘use’ me to get great wealth. All along they don't know, THEY ALL WORK FOR ME."

His name is leverage.

Canuck@ Chris Powell#5907208/05/01; 22:45:52

Mr. Powell,

Saw your exchange with the 'Mining Web' entity. Mr. MiningWeb is not publicly cheering you guys on, but within he is 'a closet fan'.

Before I go on, I will explain a 'closet fan'. If you have heard of this expression please skip by. Any novices, rookies or newbies should proceed. Up in the 'golden north', (smile) we haved cheered for the Toronto Maple Leafs' (nice term, eh!) and the Montreal Canadians for about 600 years. I, like many Canucks 'appreciate' the Pittsburgh Peguins, the Detroit Red Wings, etc., etc. but in quiet quarters, behind the scenes, we bid on the Leafs and Canadians. We are 'closet fans'.

Onward...............(as per FOA)

I don't believe for a nanosecond that the POG is not 'managed'. Expanding, I don't think that the economy at large is not manipulated. It has to be, the people have to be content, otherwise they will get restless and disgruntled. I have the impression that many people, groups, organizations, corporations and probably some governments agree with you regarding the gold management process but they are 'closet fans'. How many of the above listen to the GATA data, endorse the concept (verbally) but fail to 'join ranks'. Look at Placer, they gave you $10,000 and when asked about the Howe proceeding they were 'neutral on the matter'. What the hell is that?

"Mr. Placer Dome, do you want us to fight for the free market, supply and demand price for gold?"

"Let me get back to you on that."

So let me ask you a question. The producers, particularly the majors, are sitting in the weeds apparently waiting for something to happen. Do the majors want a higher gold price? Why do they not jump on your bandwagon?

I have it now. In the last couple minutes it has struck me like a 2 X 4. The majors are either 'owned' or they are scared shi*tless. Is Barrick a sleasy, hedge fund aided and abetted by crooks operating behind the scenes by still more crooked bankers, perhaps investment bankers and even central bankers? I ask because I do not know or even suppose
to know. Is Placer looking for an honest POG but dare not ask for it? Did you see Franco-Nevada'a 'Outlook for Gold' in its recent quarterly report?

"A positive development for mining in the US was the election of President Bush. His cabinet appointees promise to deliver a more even-handed operating enviroment than the Clinton or possible Gore administration."

Let me paraphrase that, " Bush promises to deliver a more even-handed operating enviroment." Wow, is that a mind-blower; page 7, paragraph 3, 2001 Annual Report. (FN-T)
What are they (obviously) not saying about Clinton?

What did Franco say when you asked for their support?

I think FOA may be correct, mining shares are a potentially dangerous investment. The explosion of gold may be limited to physical only. Your thoughts?

I ramble, I apologize. I am forward, hopefully not too so. I am sure nothing that I have asked or mentioned has not been said or thought at least a 'couple' times.

Good luck with your endeavors.


wileyBlack Blade---Pobre Prairie Chicken#5907308/05/01; 23:16:41

Much appreciate your ongoing energy updates. Don't know if you have seen this AP report by Mary Perea in the Sunday Santa Fe New Mexican.

ALBUQUERQUE - A battle over oil and gas drilling lands is being waged across the valleys and deserts of New Mexico, where producers chafe over restrictions on their access to federally managed land.

New Mesico is already a top producer of natural gas and crude oil - its known natural-gas reserves rank second only to Texas - but industry officials complain that some of the richest areas are of-limits because of environmental concerns.

"We are severely limited in our ability to maximize the production of oil and gas in New Mexico," said Bob Gallagher, president of the New Mexico Gas and Oil Association.

These days, producers are especially interested in moving into Otero County in southcentral New Mexico.

Harvey E. Yates Co. in Roswell applied for drilling permits in that area's Oro Grande Basin after significant discoveries were made four years ago. While the Bereau of Land Management has not denied permits, they have not been approved "in a timely manner" said Steve Yates, company vice president.

Both Gallagher and Yates say pressure from environmental groups has hindered acess to New Mexico land.

There has to be some trade-off, Yates said; the land cannot go totally untouched while still keeping down gas prices.

"What we're trading is invironmental purity for the price of our energy need,"Yates said "We can, in an environmentally friendly way, develop our natural resources. We can and we have."

Steve Capra of the New Mexico Wilderness Alliance disagrees. He said two frequently drilled areas - the San Juan Basin in the Four Corners area and the Permian Basin in the southeastern part of the state - are proof of the damage the oil industry can do. Power lines, pipelines and gas rigs cover the land and the smell of gas pollutes the air, Capra said.

"This is not benign activity," Capra said. "These rigs require water, they require a lot of infrastructure."

Capra describes the Otero Mesa as an "open valley with the Sacramento Mountains coming in from one side and the Gualalupe Mountains on the other side. You are in a vast open space that is quiet and pristine," he said.

"It is never going to be the same if we allow oil and gas development around it."

Otero Mesa is one of three areas where Gallagher said the industry disputing BLM regulations. He said restrictions on drilling in the Permian and San Juan Basin also cause concern.

In the San Juan Basin, new drilling has been linited to within 300 feet of an existing road while an environmental impact statement is being completed, Gallagher said.

In the Permian Basin, drilling is restricted for three months on 450,000 acres because it is the MATING SEASON OF THE LESSER PRAIRIE CHICKEN (emphasis mine). He calls that restriction, which runs from March 15 to June 15, "bizarre," Gallagher said.

Hhowever, according to the BLM, its decisions are based on many factors. Those include an assessment plan, which is done before drilling is allowed in an area. end

Makes me want to renew my membership in PETA (People who Eat Tasty Animals. LESSER PRAIRIE CHICKEN?????

tedwSilver#5907408/05/01; 23:52:33


Here is a prognosis on silver from the Safemoney report


Warning: Continue to steer clear of silver! Just as I have been telling you, silver continues to sink in value, falling 13% since the first of the year. Now, it's about to bust below $4.20 on its way to well below $4.00 an ounce ... and eventually even to $2.00!

A lot more on the money than Ted Butlers essays.It is amazing how much "the experts" can disagree. Obviously, someone is not an expert.

Netkingtedw - Ag#5907508/06/01; 01:25:38

Howdy Sir Ted(59074)For sure Martin(or Larry for that matter too) have been saying/inferring: "First Ag to $4.00 & then to the Universe beyond to $2.00!" . . . they could be right, it's not impossible, lets face it yes?

But with all due respect to their professional careers, I believe they are currently not in touch with the market as close as they should be if this is their view point. I could be wrong as well . . . . .but the mathematical chances are however very remote of what they preach happening.

There is very strong underlying support for physical Ag at current price levels with steady, constant & strong accumulation taking place. If we have a washout down to $4.15 (or even $4.00'ish)IMHO, this would be as low as we would get, it would be VERY short term and the demand for physical by speculators, investors & industry would be smothering & would explode with physical buy orders at these prices. Who would be the sellers of physical at these prices? Those who bought comex-long would take delivery, Comex Ag inventory stock levels would go down real fast!

Ag's at a 5,000 year inflation adjusted low, what we've mined for 5,000 is almost naught, but Martin says $2.00, we'll see Sir!, but I for very respectfully differ with his viewpoint. - regards Netking

SteveHA friend sent me this...#5907608/06/01; 01:46:35

he didn't know which message board it came from. Sound familiar?

From: tradermike_1999

Let me tell you about two stocks. One has a P/E ratio of 100. It has completed
a head and shoulders top pattern - the most bearish technical pattern there is -
and fallen over 30% in the past few weeks and will most likely to continue to
decline. A month ago insiders filed to sell millions of shares. Today an
analyst at the firm Dain Rauscher Wessels upgraded the stock. Various talking
heads on CNBC reported the upgrade several times today. The stock is up .40
cents today as people bought off of the upgrade news.

CNBC did not report on the fact that Dain Rauscher Wessels was one of the lead
underwriters that took this company public. In fact it owns several million
shares that it will have to dispose of some time in the future. The analyst
said that the stock is a "strong buy" because it has a "low valuation." But the
stock has a P/E of 100! If you haven't guessed it yet the stock is Krispy Kreme

This morning Maria Bartiroma - nicknamed the "CNBC money honey" - reported that
Priceline.Com(PCLN) has been upgraded to a strong buy by Merrill Lynch because
the people at Merrill think that it will make 14 cents a share next year and
they claim that the stock has a "low valuation." Maria did not tell her viewers
that Merrill Lynch was the lead underwriter and investment banker for
Priceline.Com and owns millions of shares of the stock that it will eventually
sell. Nor did she tell people that even if it were to make 14 cents a share
next year it would have P/E of 60. She told everyone it was cheap and didn't
blink while she did it.

At the exact moment that Maria repeated these analyst upgrades over in
Washington Congress was holding hearings into the conflicts of interest that
analysts have and warning people not to follow them. The acting SEC Chairwoman -
Laura Unger - told the committee that the SEC has found that 1/4 of the
analysts own stock in the companies that they covered and three out of 57
analysts sold shares while they issued buy recommendations on stocks. This is
something that is completely illegal but the SEC does nothing about it. I run a
website and disclose my stock positions all of the time. If I didn't and told
you to buy stocks that I already owned than I would be fined by the SEC - and I
should be! The SEC needs do the same thing to the big financial institutions on
Wall Street. The only thing that discourages them is investor lawsuits by
people who were taken to the cleaners by these pump and dump operations.

These Congressional hearings are unprecedented. When is the last time you can
remember Congress going against the power of Wall Street and exposing its
underbelly to the public? This is big stuff, but CNBC has placed a total news
blackout on the hearings. Why?

We can only look at Maria Bartiromo to see the answer. She typifies the style
of reporting that you see on CNBC. She is smart. She has contacts on Wall
Street and is very familiar with how pump and dump operations work. Her husband
ran a penny stock magazine that pump and dumped stocks. In fact he found
himself indicted and fined by the SEC for his operations. She just came out
with a book called "Use the News" and has been on Good Morning America and
Charlie Rose touting it.

In her book she tells investors to use analyst recommendations and press
releases that companies put out to know when to buy or sell stocks. In other
words they should stay tuned to CNBC to know what is going on. This is her
style of reporting. Every morning she gets on TV and spouts off all of the
analyst recommendations and never mentions their conflicts of interest. By
omitting this information she makes their opinions appear legitimate and the
average person who watches the show sees no reason to suspect anything. If they
see something an analyst says that they like, such as "stocks will go up", then
they believe it because it is what they want to hear. If they are looking for
the next hot stock to buy the cut on the TV and jump on something that has a
positive spin on it.

And here is why CNBC does not cover the Congressional hearings. They depend on
analysts for their content. The entire channel is nothing buy a rolling call of
analyst recommendations. It doesn't have to be. They could hire reporters who
have enough knowledge about the stock market to give you their opinion on what
stocks are worth buying and where the market is going. But that would mean
taking some responsibility for their content and it is much easier to just
repeat what someone else is saying and let them be responsible than to take
responsibility for yourself.

But the fact that they do nothing but rely on analysts and people with an
agenda means that it is completely useless as a source of investment
information. In fact it is hazardous to your financial health. Successful
investors don't make money by buying because of analyst recommendations or
press releases. These "news" stories are designed for one thing - to provoke
you into taking the course of action its creator wants you to take. If a firm
owns a stock and they upgrade it they do so because they want you to buy it,
not because they want to help you make money.

Let me give you a real life example. A year ago I was watching a small
Australian biotech company that claimed to have created a "miracle vaccine" for
skin cancer. It turned out that most of their research was nothing but a hoax
and anyone who took the time to do some research on it could easily find this
out. A group of cancer researchers at a major university published an article
in a medical journal that blew apart the claims of this biotech company
completely apart.

The stock was being heavily promoted. I got an email message from a major
shareholder asking me to tell my readers to buy the stock. The guy even told me
that a large financial website would put out an article about the company and
make it go higher. And he was right. But those aren't the type of stocks I am
interested in buying. I don't invest in frauds. But that didn't matter to Wall
Street or CNBC.

The Wall Street firm of Gruntal gave the company a credit line and helped it
carry out a secondary offering that gave Gruntal several million shares in
return. The head analyst at Gruntal, the highly visible Joe Batipagglia,
appeared on CNBC and said he was upgrading it to a strong buy. The following
day CNBC scheduled for an appearance of the CEO of this company to appear on
their show next week. I emailed CNBC and the reporter for this segment - Bill
Griffith - information about the company, including the medical research
reports. I received no reply.

The stock rose from $9 a share to $12 1/2 a share on the day of the interview.
The second the CEO appeared on TV I shorted the stock. It then fell sharply
into the close and now trades at less than $2 1/2 a share. Every single person
who bought the stock that day because of Joe Batipagglia or CNBC has lost

This is how Wall Street and CNBC work. People who depend upon CNBC as their
primary source of financial information are fools. There are so many better
sources out there. Read the Wall Street Journal, the New York Times or
Investor's Business Daily. Subscribe to websites or newsletters who shoot
straight. You get what you pay for.

I hope something good will come out of this bear market and these hearings on
Congress. We need to see a real crackdown on the part of the SEC on analysts
who break the law by telling people to sell when they buy. It is nothing but
robbery and fraud.

And we need to see some real reform. We need to see it made a requirement for
analysts to disclose any conflicts of interests that they have when they give a
recommendation and we need to see the people who depend upon them for their
content - the CNBC talking heads - to report on these conflicts of interest.

If CNBC doesn't change they will suffer in the long run. People will get fed up
and stop watching, especially if the bear market continues. Its rating will
plummet. But that would be a good thing for the average investor because
anything that takes it place will be better.

LeighWorldNetDaily Covers Gold Petition#5907708/06/01; 02:29:06

In this morning's WorldNetDaily, there's an article entitled "Canadian Challenges U.S. Gold Policy." It's about Barrie Walsh's petition (the one seeking 10,000 signatures) to U.S. Treasury Secretary Paul O'Neill about our gold policy.
Belgian@ Leigh and "THE" question * WHEN * (#59059)#5907808/06/01; 03:08:05

With a large pot of fresh coffee and inspiration from Trail Guide(s) - This forum posters - and the recent Wood/Powell exchange...

* WHEN * : As soon as the " REVALUATION " of Gold is in progress. As soon as the global community accepts this process as a re-valuation.

Your/our/mine question of "when", has at minimum, 20 years of age. The intrinsic falsification is the result of a superb " CHAOS MANAGEMENT " ! Impossible to time and describe the unfolding of what is to come. And therefore a waste of energy in researching it.

Much more "CRUCIAL" is to agree on " GOLD " as the Universal *INDICATOR*. The one and only . The indicator that is crushing all other indicators with its overwhelming conviction, leaving no possibility for any kind of dualistic interpretations.

As long as a large majority continues to do the paper-dance and ignores Gold...the falsifications and artificiality circus goes on ! This message is the deep foundation of TG's thinking. All other indicators have lost their impact and function. Nothing can cry hard enough to stop that "chaos management". And it took me 20 years (yes,20 yrs) to understand. All this trough deductive elimination of all other aspects of the ever growing falsification.

*Systemic Collapse* and * Massive Financial Crisis* outcries, have lost all of their significance...because they aren't answering your "when" question. That's why the diarhea isn't stopped. The dollar is re-hydrating the global corpus ad infinitum. It is "THE DOLLAR", Leigh !
Its that emporor without clothes. He and he alone is the headmaster of the chaos management. Will he die on a sudden stroke or cancer slowly away....? I DON'T KNOW !

So, the second part of our fundamental insight is focused on the conviction and agreement that the dollar is the one and only instrument wich made chaos management possible.
And where do you see or hear these two convictions (gold + dollar) to be elaborated on a populist scale ? That is exactly what all collectivities are avoiding. They are only concerned about playing the music as to extend the paper dance.

*When* the Euro starts to challenge the dollar on equal terms...then the probability grows for collapse. So far, no other event (accident) could ignite the deroulement.

Is there another timing-indicator, than Gold, wich could signal, extreme danger, with enough conviction ? Sure there are. Interest Rates...yep, exactly...they are managed !
As long as we all accept (and believe) that paper is and has intrinsic value...the show goes on. We are all getting bored and annoyed, asking, again and again...when does this show ends ?

Glad to hear that Miningweb states : ...there are tons of vested interests ranged against gold and that is the unforgiving reality we swim against...(Tim Wood)

part I

Netking"USA & Britain preparing attack" - Iraq #5907908/06/01; 03:44:31


Iraq says the U.S. Navy is tightening the embargo on the regime of President Saddam Hussein in preparation for an attack by Washington and its British ally.

Both U.S. and Gulf sources report that Washington is preparing a major attack on Iraqi military installations.

Iraqi officials said U.S. warships are intercepting ships headed for Iraq through the Persian Gulf, Middle East Newsline reported. They said the ships include regular lines from such Gulf Cooperation Council states as Bahrain, Qatar and the United Arab Emirates.

Meanwhile, Iraqi State Minister of Foreign Affairs Naji Sabri said the Saddam regime will defend Baghdad against any U.S. or British attack . . .
- Netking

Belgian@ Leigh *WHEN* part II#5908008/06/01; 03:55:39

All kind of people everywhere are "HOLDING" and "USING" emperor Dollar. For no other reason than instinctive trust.
What is going to change and of course "when", that 30 year old proliferated perception ? The almighty dollar has "reserve"-status, there to be seen and profoundly accepted. Who the hell, dares to challenge this global authority ? Answer : Dictators are always replaced by (pseudo) democrats. The only ones that can challenge the dictator... are the GOLD HOLDERS ACCUMULATORS ! Nobody is going to use Interest Rates, to signal that the dictatorship has gone to far. Simply because the dollar is dictating the IRs.

Your "when", brings me once again to the question : can we (dwarfs)(yes, gold-dwarfs) *do something* ? Because, all that talking is so bloody cheap. Yes, do what ?
Answering the "when" is just stand up, leave the show, and buy physical gold ! Buy more physical gold and tell it to everyone who doesn't want to hear it ! How Naive, isn't it ? No it isn't, because I'm convinced that many others have much more interest and buying force than me the dwarf. But "the others" are seemingly much less convinced than I am. And they are a reason why the show (permanent currency depreciation) goes on and that not enough spectators are standing up and leave...and buy.

And most of the good will on helping to end the show is translated in renewed paper dance outside the theatre. Buying all kinds of paper and too much opportunism. I'm referring to goldproducers, gold-activists, gold funds, goldbugs, financial middlemen/analysts/advisors and others.
And I do understand very well "why". Simply, because I did it myself ! Not ashamed of it, anymore.

*When* 1 million responsible individuals out of 750 million economic affluent, can be convinced to buy 1 Kg of physical gold in 1 go...your/ou/mine, answer of "when" will appear.
Just a matter of reaching all these dollar-trustees and make them doubt about the emperor and his clothes.
That's why I mentionned the disappointing result of the petition. There are not enough authorities who reach these dollar holders with understandable (convincing) arguments !

Simply because the most universal, convincing argument is precisely the POG-BELL ! Get POG behind the 350$ barrier and your arguments are gaining weight ! And everyone who is contributing to the paper show (no names) is in se contra-productive in reaching that psychological signal.
I can't move 140.000 tonnes with my fist of coins, can you ? But one million dwarfs, equal one Giant. And if one Giant, yawns and awakens...other...

part II

NetkingChina - Ag exports(?) to stop, Au imports to increase.#5908108/06/01; 04:14:37

Snippit(Bridge News):

China's consumption of silver and gold is expected to rise through 2008 when the country's capital city of Beijing will host the Olympic Games, producer sources said on Monday.

Demand for silver and gold Beijing Olympics-related commemorations and souvenirs are seen increasing in the next few years, they said.

Rising consumption may cut China's exports of silver in the next few years but increase imports of gold, they added.
This a topic that Randy & I touched on here a while back, never underestimate the size of the market potential in this sleeping giant yes.

The "jury is still out" on whether there are/were in fact any substaintial Ag PRC exports. However if or whatever they were. . . domestic demand appears to be bullish and will be affecting domestic PM demand.

I can see it now . . . "A 1/oz commemorative olympic PM coin for every citizen!"(Ps don't forget the 6 pack of film too guys!)
- Netking

Belgian@ Leigh "WHEN" part III#5908208/06/01; 05:12:01

The present paper gambling show is the most pleasant swing-palace, ever experienced. Paper profits and losses, keep on swinging all over the place. What great fun. Gold and its valuation are the only big bully that can stop such clownery at once. But the gamblers are stoned drunk. etc...etc...Plenty of paper drinks on this party.

All media do report on this ongoing gambling-happening. That's where the public is and they (the public) want to see themselves pictured. Who dares to intervene (or can stop) and spoil that party ? And yes, not if but when ?
Answer : the ones who are not participating in the pleasures of paper illusions. Who are they : No, none of them.
The only miserable outcasts excluded from any party pleasures are physical goldholders (not traders) and some other producers of essential tangibles. The oil-boys, managed to exit (for good) their misery. They are the only ones that could organise a party of their own. Gold-owners stick with the company of other tangible (CRB-resources) producers : silver, coffee, cacoa, zinc, copper etc... oh les misérables. The one and only (!) ruler that is responsible for such an "EXTREME" situation is emperor dollar ! And this situation is not from a recent date but has been build during the past 30 years. I'm not re-inventing it and others have been explaining "why", before.
We are living in a service economy etc...

The dollar connection has never been considered. An extremely overvalued dollar that dwarfs basic essentials in their valuation. This is evidence to me for what I define as "falsification". An increasing amount of un-necessary (non vital) services are created daily, and valued with ever more paper. Almost obscene exposure of luxury.

We derived too far away from basic proportions. The dollar is the deriving current, who made this possible to happen.
Gold is the only commodity (sorry) that is strong enough to survive this anomaly and to head the tangibles revival.
This "KEY" strenght of gold is totally neglected, ridiculed and ignored. And not the least by the ones who have the largest amounts of gold in their posession. And that is frustrating and intriging at the same time.

No need to explain why it is frustrating but rather why it is intriging. And here we land again with the only argument left : Timing, the "WHEN" ! And than I plunge into TG's genial insights for helping us out. But there is something funny. Am I the only one to be TG obsessed ? Seems so ?
Is there nothing in this sublime vision what is attractive to other gold-holders (no names) ? Who is afraid of Virginia-Dollar-Wolf ? Is the dollar dogmatic to all (goldholders)? The same does apply for oil.
I'm not expecting that the official goldholders do mention anything about TG's visions. But what about the fragmented underground goldholders ????? Why do they focus on the GATA
ball and not the FUNDAMENTAL (!!!!) dollar-Gold Play (sorry TG) ? Sir Timothy ? Are side effects-attention and minimalization of Gold a policy ?

Pfffttt, Leigh...what an idea to come up with that "when" question of yours. It is already an aging question. It is "THE QUESTION". Gold, "to be or not to be".
And is the W.A. event the only evidence that "it" will happen in our lifetime ? Yes, I'm totally convinced it is !
But, again I humbly admit it took me quite some time to build on that conviction. I do understand that many others (wisely or not), remain very cautious on such an amount of conviction and faith. Pauze

Hill Billy Mitchellgoldfan @ # 57950 and SteveH @ msg# 57920 and Pragmatic @ # 57954 and Belgian#5908308/06/01; 06:40:04

Add me to the list of those who believe that the USD index is the key (trigger) to watch. We must look everywhere for signs but the trigger is the USDX. I have been watching currency charts for quite some time now. There are certain patterns that I have noticed. The Euro and the European currencies weigh in so heavily that you can watch the USDX and pretty well see what is happening to the Euro. You can watch the Euro and pretty well see what is happening to the Pound Sterling, the Deutsche Mark, the French Franc, which all move in lock step with EURO and move inversely with the USDX. The only way you can see what is happening to the Yen is to look at the Yen. The Canadian $ and the Australian $ plus some of the currencies in the countries located in South America appear to be nothing more proxies of the USD, for they seem to move in tandem with the USDX. They have moved inversely (as a group) in relation to the EURO and the European currencies. The other currencies, with the exception of the Yen, do not seem to matter in the sense that they do not carry enough weight to make any real difference. The Yen seems to be hanging out there all by itself. It can move in either direction. It is almost as if the Yen is the very key to the stability (the balance of power) between two great warring alliances.

Could this be a replay of what has happened many times in the history of the world? The last time the world was at war Japan appeared a fulcrum so to speak. It turned out in that case that Japan chose to move in the wrong direction and sided with the eventual losers. We now, again have a Japan who has not really chosen which direction to shift its considerable weight. There are similarities. Japan is overweight and unable to move decisively. If Japan strikes it will be as Pearl Harbor, because the only chance it has of being on the winning side with hopes of being on the very top is by surprise attack.

Lest there be those on the forum who cry foul, racism and blather of the like, let me say unequivocally that I am not referring to the Japanese as a people. They are Asians and no better or worse than Caucasians or any other race. Where these individuals or their ancestors were born has nothing to do with Japan, the Nation. Japan, the nation is still controlled by the same families as those who were in control during WWII.
The East is East and the West is West. The twain shall not meet. The West shall eat the East for breakfast. There has been no shift in TPTB in any area of the world, save maybe in intensity of power. International Bankers probably have a stronger grip on the controls in all areas of the world. Certainly the U.S. has given up on keeping the central bankers at bay. I suspect that they, the international bankers, also have much more control over Japan than they had in the 1940's

This time around may be different. The USD, the EURO and the YEN may all become one. There may be no need for all out military conflict this time. Japan is at the fulcrum again. My bet is that Japan will align with the EURO. As I have stated before, I believe that England will align with the EURO and it matters not, which one makes the first move, as the other will follow in short order. The U.S. government will probably capitulate with out a military exchange. It will be the first time in history that a nation will have given up world hegemony without a physical fight. While the battle rages the war has been lost.

I have always been in agreement with the Another scenario, in that what we have is a currency war and the real struggle is between the USD and the EURO. Our difference lies in that I prefer no hegemony at all in this world, including the hegemony of the UDS. Another does not seem to have a problem with the continuation of world hegemony. He just recognizes what is coming and is preparing to be in a position to make the best of the situation. This approach is certainly a pragmatic one. Mine is an idealistic one. There will be those in the U. S. who will hunker down and hold on to personal liberty should these events transpire. I hope to be one of those who hunker down. It, IMO, would foolish to take my approach without a goodly percentage of my wealth in the highest degree of portability. Most will docilely follow instructions and get in the truck bound for their relocation center.

I must return to the issue that initially prompted this post. The USDX is the key. If it were to stay at the current level or go higher for a very long period of time we would have a one trillion dollar annual trade deficit. The USDX will crack long before that one trillion dollar annual trade deficit arrives; however watching the trade deficit for timing will be of no use, for it moves too slowly. What will move downward precipitously is the USDX and when this happens gold and silver will join Alice. This is where the thoughts of ANOTHER and many of the thoughts on this forum converge. Hegemony will relocate to the EURO and those holding gold, especially those who are forced to use the USD for purposes of legal tender will find themselves with some powerful assets hitherto thought to be nearly worthless. Derivatives in any form including derivatives in physical metal will be worth only the intrinsic value of the paper they are written on. Physical metal only will do.

Very respectfully submitted


PS: Belgian, I just read your three-part when response to Leigh. I do not believe that my speculations here conflict with your thoughts there. Will read thoroughly when time permits.

PSS: The trigger (the U.S. Debt Trap) the twin deficits. We will see either 1 trillion $ annual gross U.S. budget deficits and or 1 trillion $ annual balance of payments deficits. (When? When the dollar tanks.

BelgianThe Paperization Festival#5908408/06/01; 06:43:54

Global "ORGANIC" growth meets "SATURATION" .
The " importance " of the product "as such" comes secundary, these days.
The main focus is on the pseudo valuation (machinery) of the paper that must (is not) represent the product(s). It has become an *art* to promote your paper, competively. Be it paper currency or your company's stock. Dominance (currency) or hyperconcentration (stocks) is achieved with hyper-valuation of your paper and act strategically.

Hyperconcentration trough mergers and aqcuisitions is evidence of the saturation constraints of organic growth. Product producers have to sail away from the valuation of their product and have started on the valuation trend of their paper. Enormous paper-exchange, replaces the start up of succesfull new enterprises with productive debt.

This fashion is a very strong sign (timing sign) that an end is in sight. Goldproducers try to do exactly the same thing. Get their stock valuation up with nothing but the valuation of their product (gold) and then compete for what is sophistically named : consolidation !?

There is already so much unproductive debt around that this fashion of competitive (existant) paper exchange, represents, a big chunk, of the false growth or illusionary expansion.
This paper exchange is (still) succesfull, because it means great fun for all these paper holders. Competitive hyper valuation that has less and less to do with the underlying tangibles. Be it gold or whatever.

The crash will materialize when there is nothing left to be exchanged or to hyperconcentrate anymore. At that moment the fake valuationing of paper serves no purpose anymore.
Than we go back to the product and the profits that it can generate. Or simply boring and less exiting fundamentals of slow, steady, organic growth. Hurrah, the good old times !

This fenominon is easy to understand when we take the industry as an example. But the same has already happened with the dollar-paper. Starting in 1971 officially. And this seems to be much more difficult to understand and to admit. This is the drama !
And the awakening from this nightmare can't be progressive. It must happen with a shock. The shocking moment when the casino slams its doors.

When is everything in place for such a final shock ?
Answer : when a majority starts to realise that all kind of paper in its posession is ALMOST at the bottom the of the previous fake valuation in reverse. A Dow beneath 4.000 or Nas. less than 1.000. When your bonds start declining sharply due to interest rises (above 6,5% for USTB-30yrs)). When all the paper exchange news (mergers /acquisitions/IPO/ etc) excitement, fades completely away. When all paper starts to have a burned smell ! When you start to suspect that your savings are not what you tought they were. When one sees that your retirement stay on earth will be filled with less materialistic enjoyments. When the stop and reverse in declining interest rates is making you suspicious about the intrinsic strength of your currency. When your son/daughter stays unemployed for too long. When oilprices (and derivates), refuse to come down. When there is more and more parking place at the stores. Why do I think know...because it is in the paper...those very highly valued papers.:-)

We don't know "when", but will see it fast enough when it's there. Couldn't resist using that old same boring platitude.

Please do correct this Belgian student if there is something that doesn't makes sence or is irrelevant for believing in the eldorado within our lifetime.

Hill Billy MitchellAgenda?#5908508/06/01; 06:59:05

Sir TG,

Do you have an agenda? Do you have a certain audience to whom you to cater?

Are you of eastern descent who lives in the USA? Are you of western descent who has lived in the east but now lives in the USA?

I ask these questions because you seem to indicate that westerners are not capable of thinking like easterners. Perhaps you are right in this. I only speak and read in one language, but I have read somewhere that, there is a whole lot of difference between speaking and writing in a second language and thinking in a second language. I am going somewhere with this, so please be patient with me.

You seem to indicate to us "westerners" that you are of either "western roots" but are able (unlike the rest of the general population) to think like an "easterner", or that you are of "eastern roots" but are able (unlike the rest of the general population) to think like a "westerner". It is sort of like being bi-lingual. Let us call it "bi-thinkual", the ability to think in two different cultures. You seem to be convinced that "westerners" generally are not capable of becoming by-thinkual. I believe you mean in your writings that those of "western" thought have some sort of cultural handicap making them incapable of thinking like those of the "easterner".

If this be true, then could it not also be that the "easterner" is similarly handicapped in the opposite direction. And if so, could they not possibly be even more handicapped than we "easterners"? Why? Because "western" thinkers (Europeans) have been directing world economic activity through the control of national and international currency supplies for quite a good long time. In fact even you indicate that the coming shift in world reserve currency is to be from one region of the west (US Dollar) to another region of the west (European Euro).

I believe that it follows that the "western" thinker will be better off than the "eastern" thinker. Western civilization will understand more clearly as this scenario comes to fruition and may be more favored by and by. The "easterner" may be in a daze when the grand power move comes to the light of day, yet you seem to be telling us that the "easterner" will fare better because he is more disposed to have physical gold in his possession. Would that be a true observation?

Another point I would like to bring up: You seem to be content with the coming annihilation of the US dollar, even to the point of being, shall I say, pleased with the thought. Is this just pragmatism on your part or do you really welcome the coming Euro Hegemony?

I believe that I am a pragmatist also and do expect the transition of global currency power to come to these ends. However, I do not relish the thought. Do you relish the thought? It seems to me that no patriotic American could relish the thought. Nay, I say perish the thought!

Back to the subject of one being bi-thinkual, it is my judgment that Japan has shown the ability to adapt to "western" ideas more easily than any other peoples. As a nation of people, I would say that they are more capable of thinking in eastern and western contexts than any other significant economic unit. This would apply to the leaders in the government of Japan as well as the financial and industrial power brokers and permeates the whole population of the nation. A logical conclusion from the premise would be that it would also apply to the many U. S. Citizens of Japanese Descent.

I have been mulling over a line of reasoning for several months. To me, it is a given, that the UK will align with the Euro, but Japan is not a given. I believe that Japan will also eventually align with the Euro, but will do so, not willingly but of necessity. The trigger of necessity could be squeezed, either before or after the official move into the Euro camp by the British. The hegemony of the Euro is only a matter of time, but the great question mark is Japan.

Japan moves of necessity. Japan has always needed natural resources. Why did Japan turn on the U. S. in 1941. I submit that Japan was forced to do so. Japan perceived that U. S. dominance in its sphere of the world was going to cut it off from vital resources and destroy its economy and destiny. Germany and Japan had a common enemy: --the United States of America. History could very well repeat. If Japan perceives itself to be again, vulnerable to the U. S., out of necessity Japan will align with the Euro powers. It behooves the U. S. to avoid the alienation of Japan this time around. The U. S. is no longer a "sleeping giant", but rather "an overweight giant", lumbering to the edge of a cliff. The U. S. could guarantee (promise) Japan the resources it must have to survive in exchange for a merging of the two economies and currencies. The balance of power could save the day. Of course this will not happen because those in control of U. S. economy and government do not, in my opinion, have a desire to save the U. S. On the contrary, they see the only way to continue economic, political and military hegemony is by abandoning the dollar in favor of the Euro. These world controllers are not in the least bit nationalistic. The U. S. as a nation is the only thing standing in the way of the coming global political and economic union.

Japan and the U. S. are natural enemies. Germany and the U. S. are natural enemies. Germany and Japan will align with each other again out of necessity. This time around things will be different though. Germany will have the United Kingdom in its camp. Japan could be squeezed into submission for fear of China.

Very respectfully submitted,


Max RabbitzWhen? Leigh, Belgium et al.#5908608/06/01; 07:09:38

Do you want those days to get here quickly? As an American I'm not in any great hurry. I wonder how the Canadian Dollar will be affected. Certainly business will be disrupted. Unemployment? Crime? Social collapse? Wars? Us dogs will have to go hide with what is in our bellies as the lions fight over scraps.

What about the Australian dollar? I assume the Pound will be no more. I would have prefered a quiet life with regular investments in producing assets. These are no longer attractive.

When? When does the herd of stampeding buffalo change course? Perhaps a gopher will pop it's head out of a hole and sneeze.

Max RabbitzEconomic Revisions....a snippit #5908708/06/01; 07:52:58

Last week's revisions produced a very different view of 2000. Instead of growing 5 percent as originally thought, the US economy grew 4.1 percent. The profit revisions went in the same direction. There were big reductions in 2000 profits and smaller revisions for 1999 and 1998.

But the most interesting numbers may have been a more obscure set of figures that measure profit margins or the share of the economy's output that winds up as profits. Warren Buffett, a pretty fair investor, attaches great importance to the profit margin numbers. Buffett believes that the rise in those margins from the early 1980s to the late 1990s was a key driver of the great bull market of the last 20 years. As Buffett put it in a 1999 Fortune article, ''The value of an asset cannot over time grow faster than its earnings do.''

There's just one problem. Profit margins peaked in 1997 and have been dropping since. For the past few years some of the money that once flowed to profits flowed to the American worker, in the form of higher wages. In 2000, wages climbed 8.2 percent, up from the original estimate of 6.7 percent.

For investors, that shift was not good news. ''Corporate America is not doing as well as it was before,'' said Breimyer. American companies took on those added costs just as the economy was turning down. That mismatch explains why business has shed so many workers this year. Friday the government said that another 42,000 jobs disappeared in July.

The rewriting of history isn't finished. The government this week will release productivity numbers that are expected to show that the productivity miracle of the recent past was somewhat less miraculous. Rising productivity - the ability to turn out more without adding costs - was a key reason for investor optimism.

''The productivity revisions will be nasty for the equity markets,'' said Allen Sinai, chief economist at Decision Economics.

But investor optimism is hard to kill. Just ask Brian Bruce. Bruce is director of global investments at Panagora Asset Management, a Boston money management firm. Bruce regularly studies the earnings estimates produced by Wall Street analysts. What he has discovered is fascinating.

Analysts, he says, do a pretty good job of adjusting forecasts for the next quarter and the next year in response to news. But they rarely adjust long-term forecasts, typically five-year forecasts. Consider Cisco, an extreme example of what Bruce is talking about. The troubled tech company is expected to see its earnings fall 22 percent this year and another 33 percent next year. Yet the analysts who cover Cisco still put its five-year future growth rate at 25 percent.

Belgian@ HBM#5908808/06/01; 08:26:10

Sir, if it is true that Japan is holding 40% of total global savings...then you are very right, that we don't give them the attention into the dollar-equation.
It is so generally accepted that the world's second largest economy will automatically follow the first. This is not at all, that evident to me either.

Japanese savings are the antipode of the dollar's debt.
Or they continue to defend the dollar with bare teeth or are lured into another choice. But what is their only defense (for their saved dollar) : accumulate more of it and refuse to valuate their own yen in real proportion to their work + savings. A very difficult choice for them.

And indeed, west stays west and east stays east. Japan has no outspoken stance or affinity with europ. Their choice will therefore be pragmatic. But the Koizumi measure of halting state expenditures is a significant signal in policy change. Not in line with US money expansion.

The reality that * NOONE * dares (and wants) to challenge the dollar "OPENLY" now and the reason that all possible currency strategies must remain hidden.
Japan already threatened before, using the dollar's anti-material "GOLD", for putting pressure on the dollar's discipline (forgot name + date). Japanese choice, pro US, is therefore not as evident as it seems.
Japan is in a quite shizofrenic position with its Yen. US trade and Asian competition (say China). Probably they are condemned to follow the US and not allowed to make a free choice, due to China's hostility towards both, the US and Japan ? Do we have to exclude them from the balancing weight
for this pragmatic reason ? Japan is in the ban of its continuing economic contraction and awaits relief from the Yen position. If the dollar dives into hyperinflation...isn't Japan pragmatically condemned to follow as to counteract the chineze currency ? Aren't they waiting for the moment that dollars will start bidding for euros ? Here in europ, we don't see any signs of possible, euro-anticipation (openly) from Japan. Do you see some dollar aversion ?

Japan as a substantial dollarholder is limited in its choices. This limitation is handicapping all other dollarholders. Point is : where do they all suddenly realise they were and are still holding a rotting debt paper ? My previous chart reading suggested the breaking point in the DGX at 105/95 zone, where C-down of the ABC pattern (with ATH in '85) would materialize. (timing tool ?)

US trade deficit : who and why should stop it, especially if the dollar-propaganda is still functionning.
Are they buying time and postponing necessary measures in order to keep on putting the euro in a bad picture ?
What a stupid strategy. And at the same important is the Gold bully ! Now I do understand why nobody dares to use Gold (squeeze) to challenge dollar the almighty. Enfin, I think I do ?

LeighBelgian, Max Rabbitz#5908908/06/01; 08:29:18

Belgian, thank you for your three-part answer to my question. I am constantly reading the gold forums, trying to figure out how best to plan my family's finances. Both you and TG have indicated that the worm will turn at some point in our lifetimes. Every day I have to make decisions, such as deciding whether to re-roof the house this year or buy more gold, whether to restock my Y2K stash soon because hard times might be just around the corner, and so on. So many day to day decisions hinge on the "when." I already know the "what" (buy gold) and the "why" (dollar collapse).

I am going to keep re-reading your posts (I was up most of the night with a sick four year old, so I'm very tired now). I don't know who you are, but you seem very knowledgeable, and that's why I asked you. I appreciate your thoughtful answers.

Max Rabbitz, I understand what you're saying, and no, I don't look forward to the United States in shambles and my neighbors' lives ruined and possibly in danger. However, I think those things are inevitable. I am very thankful for the wise counsel I've found on this forum, because I'm mentally and financially prepared for such a future. I hope that the gold I've purchased will bless many lives, and that I won't be like Oscar Schindler at the end of the movie, thinking that if only I'd made some wiser decisions, I could have helped even more people.

Max RabbitzEastern versus Western Thought#5909008/06/01; 08:41:51

HBM et al.

After the Roman empire split into an eastern and western sections the economic systems also split. The Roman west continually degraded their coins by reducing percentage of Au and Ar purity, or size, or used clads, and relied on fiat decrees to establish monetary values. In the east the Bezant gold coin was never debased and was a standard used throughout the trading world for many hundreds of years. The west declined rapidly. The eastern empire lasted more than a thousand years. It came from and encompased the Greek world of Alexander and those people who first (or among the first?) to develope the concept of money and coins. My point is that to me the East, and Eastern thought begins with Constantinople and the Greeks and extends thoughout the ancient Greek world to India. I consider China and Japan as the far East.

Also, I do not believe TG thinks we Westerners are not capable of Eastern thought.....or he would not spend time hiking with us in the mountains. But I too am curious about his background. Perhaps someday.....

LeighHBM#5909108/06/01; 09:05:09

TG has told us a number of times that he's an American, and I think he's from cowboy country somewhere. But it sounds as though he's been exposed to Eastern thinking, possibly in a number of different Eastern countries. I picture him as unselfishly trying to show us what he has learned (though without betraying any confidences) so that we might be prepared for what is to come.
Gold Trail UpdateThe Gold Trail Discussion has been Updated#5909208/06/01; 09:37:26">The Gold Trail Discussion has been updated. Click on the link to read the latest updates.
White HillsHBM Msg#59085#5909308/06/01; 09:54:50

Sir HBM, It seems pretty obvious to me what TG's"Agenda" is, although i feel that is a poor use of the word in respect to what TG is doing on the GOLD TRAIL. The very handle he uses TRAIL GUIDE should give you a clue as to what purpose is in showing us the way on the trail. You can follow or not , your choice. As to his audience, of course it is people who are interested in GOLD because this is a GOLD FORUM, DUH!!!. As to his refrences to Western thinking it is my understanding he is referring to the mindset, Paradigm, in respect to Gold and other economic principles not ability to think one way or the other.Lastly, I see no joy as evidenced by TG about the fall of the dollar. Maybe you should go back and read again his posts with an open mind. White Hills
Belgian@ Max Rabbitz (# 59087)#5909408/06/01; 10:30:48


Valuation scales, proportions, and references are all mixed up. We all follow the roller coaster loops and bents as drunken sailors. Be it CISCO or an oil company. Bonds or currencies...nothing listens and submits to common sense anymore. An unreal spectacle with insane and limitless extremes. And this in under and overvaluations as well.
And how can we possibly price-valuate when the currency in wich we have to express the number (price) is false in itself. Future profits in US$...but what kind of US$ ? A strong one or a weakened ? And than again, strong or weak against what ?

Future valuations will become more and more * UNPREDICTABLE *. Valuation volatility has already reached its top.
The silence and calm of POG is reassuring. Let us consider this as kind of a signal. Coommmeeee tooooo meeeeee !

Gandalf the WhiteThank you FOA for allowing us to be able to listen to the meeting attended by you and MK !#5909508/06/01; 10:41:47

Very illuminating (together with all your normal "markers")

site stewardThe Fed conducts open market operations to serve, typically, two purposes#5909608/06/01; 10:46:19

With the market in federal funds trading at 3.75 percent today, there was no need for such operations to serve the primary objective of "defending" the FOMC target.

Yet, today the Fed's Trading Desk participated in $8.25 billion in repurchase agreements (from 3 to 29 days in duration). Unless you pause to consider for yourself the nature of the other objective being served by such open market operations as these, this information shall continue to be the small flashing warning light unheeded upon your instrument panel as you pilot your portfolio through time.

Today, among others, is a good day to buy gold.

Max RabbitzLeigh#5909708/06/01; 12:24:13

Good Response. Oscar Schindler.

So many people around me are oblivious to the danger. They have confidence in a system they do not understand. Almost like children. I wonder what the children will do when they find they have been misled? It's taken me some time to realize that there is more involved here than just making a good investment.

site stewardATTN: the poster who would be known as "GD"#5909808/06/01; 13:14:08

As I tried to e-mail your password, the address you provided on the registration form proved to be non-functional. Please contact This email address is being protected from spambots. You need JavaScript enabled to view it. to receive your posting code.


site steward10% of "alot" is quite a lot#5909908/06/01; 13:37:08

This comes from a sad article that says Indian parents are beginning to prefer to include "government saving instruments" (i.e., bonds of some sort) as dowry gifts for their daughters. But nevertheless...

---India's consumption of gold is likely to go up by five to 10 percent each year in the next few years due to increasing population, rising incomes and fashion trends, traders said.

According to the industry-funded World Gold Council (WGC), gold demand in India reached 855 tonnes in 2000 against about 833 tonnes in the previous year.---

Estimates at 10% for years 2001 through 2003:
855 + 85 = 940 tonnes
940 + 94 = 1034 tonnes
1034 + 103 = 1137 tonnes

This puts us at nearly half of annual global production potentially consumed by India alone. Where shall the gold come from to feed China's new demand, not to mention the rest of the world in a dollar-based crisis?

Relative valuations on the yellow metal are out of kilter and therefore must rise (along with price) to achieve a meaningful balance.

Further on these lines, the article actually gives a better hint at the pace of India's gold demand for this year, 2001:

---Gold consumption rose by 23 percent to 243 tonnes in January to March this year over the same period of 2000 due to buoyant demand in the marriage season and retailers re-stocking, the WGC said.---

Today, among others, is a good day to buy gold.


NetkingDelta and Goldfields are talking . . . again #5910008/06/01; 13:52:12


Mid-sized gold producers Delta Gold and Goldfields yesterday confirmed they were looking at merging, sparking a new phase of industry rationalisation.

Confirmation of the merger talks, aimed at creating an $842 million entity, comes as Australian gold companies continue attempts to lure investors back into the gold sector.

"In recent months, Delta and Goldfields have held preliminary strategic discussions, including a possible merger," Delta said yesterday.

A merger of the two firms would create a one-million-ounce-a-year gold producer, which in turn could become a takeover target for offshore predators such as Barrick Gold, Placer Dome, Anglo Gold and Gold Fields of South Africa . . . "

Netking"Options for us to strike Iraq being examined" - USA #5910108/06/01; 14:20:08

"The Bush administration is examining options to reduce the escalating capability of Iraq's military.

Officials said the White House and Pentagon agree that President Saddam Hussein's military must come under heavy U.S. attack. But they said the administration has still not concluded on targets and goals. . ."
Strategic thinking seems to be confirm that it must be either sooner or later . . . depending on how big a problem they want to tackle yes.

site stewardYou don't have to be a master chartist to see a fledgling uptrend#5910208/06/01; 14:36:30

Courtesy of WGC; weekly report to follow.


site stewardNotable excerpts of this week's WGC commentary#5910308/06/01; 14:43:40

... the German Government's issue of 12 tonnes of commemorative One Deutschmark gold coins ... full issue sold within the hour and the coins have since been trading at a premium in the secondary market.

... the liberalisation of the Chinese gold market continues ...

... further element of deregulation in the market is under debate in Russia ... whether to lift the 5% export duty currently levied on gold ...

... effective September 15th, all repayments of the Gold Bonds Scheme 1993 will be made through the Reserve Bank of India, with the State Bank of India ... the natural conclusion of the SBI [State Bank of India] programme which had originally been due to close on September 14th 1999, but which was given a two-year extension.


Hill Billy MitchellWhite Hills @ # 59093#5910408/06/01; 15:38:24


Please pay me no mind. You can follow or not, your choice.



site stewardHEADLINE: Euro Rally May Stall as Investors Most Bullish Since March#591058/6/01; 16:26:02

---New York, Aug. 6 (Bloomberg) -- Investors are more bullish on the euro than at anytime since March, optimism that may leave the currency vulnerable to weak economic reports in coming days.

Currency investors who are long euro futures, betting the currency will rise, outnumber those who are expecting it to fall by 16,083 contracts, the biggest gap since March 6, according to the Chicago Mercantile Exchange. ... An extreme bullish slant to investors' euro holdings can sometimes point to losses ahead for the currency. Such statistics are a sign many investors have already placed their bets on the currency, leaving fewer new buyers available to extend the rally.---

Well, that's certainly ONE way for analysts to spin this news. However, that sentiment might not apply well beyond the speculative trading pits of those futures markets. It seems to ignore the potential for continuing growth of an underpinning support based on the action of spot forex markets -- based on economic fundamentals of a different stripe.

Let's reread the last excerpted sentence: ---"Such statistics are a sign many investors have already placed their bets on the currency, leaving fewer new buyers available to extend the rally."---

(You can almost hear the "strong dollar" crowd preparing to shout down gold with similar words, can't you?.) Where this particular futures market analyst seems to see a given pool of speculators perhaps running out of money for the intitial margin payments on new contracts, he seems to have lost sight of the world population at large, doing what must be done "just to get by". As it turns out, sometimes life IS more than "just a gamble".


auspecJMB...... You There?#5910608/06/01; 18:20:53

From Robert Chapman at GE:
".....the Russians expect dollar devaluation soon. That is borne out by the massive accumulation of gold by a syndicate composed of Russians, Indians, Chinese, Arabs and the Rothschilds interests led by George Soros. Be patient when gold blows and the dollar breaks, $500 gold will simply be a stopping off place for it to catch its breath."

Note: Rothschild interests did come out with a call for higher POG this year.

BoxmanExplanation for apparently incorrect unemployment numbers?#5910708/06/01; 18:37:26

This is a good an explanation as I have read. Opinions?

And "in the past 50 years," writes analyst Tony Glennon, "the US economy has never experienced a full 1% increase in unemployment without a full-scale recession..." As jobs go, so goes the economy. Easy enough, right?

*** Well, maybe not. Here's an interesting little observation from Bill King, a trader in Chicago: "In 1985, the Reagan BLS understood that white collar workers jettisoned by Fortune 500 companies were being assimilated into start-up enterprises - tech firms - or forming their own companies. The government could not count that type of job creation, so they had the BLS computer add 35,000 jobs/month to employment. This is the 'plug' or 'bias' factor - jobs the government can't count, but believe are being created."

*** Under Bush, The Elder, the 'bias' was increased to 55,000 jobs per month...and again under Clinton the bias was boosted to 155-165k. Where it remains today...

*** "We now have an environment where high tech jobs are being destroyed, not created, and the BLS computer still assumes 155k+ jobs are being created that they can't count," says King. "If job creation during a decade and a half boom couldn't be counted, how can BLS count job destruction in small entities?"

*** Hmmmnn... as Eric reports below, the BLS numbers had a negative effect on Friday's markets. What would happen, in this post-bubble era, if the BLS computers should delete X amount of jobs per month rather than tack on 150k?

MarkeTalkTuesday's Productivity Data Could Cause Panic in U.S. Stock Market#5910808/06/01; 18:40:27

The above-referenced link was brought to my attention early Saturday by a friend of the firm when he called me at home. I had not seen it so I was rather intrigued by what Dresdner Kleinwort Wasserstein had to say. The premise is that the "productivity miracle" of the 1990s is all a mirage and that investors will come to their senses with the release of tomorrow's report and begin to dump their stocks at any price. Although the article is short, it reminds me of something I would read, written by either Nick Guarino of Wall Street Underground fame or by "perma bear" Martin Weiss of the Safe Money Report. To see a "respectable" investment banking firm screaming "crash" is most curious. Perhaps their bearishness stems from the fact that the U.S. Dollar has topped out (on July 5th per an earlier posting) and that the tide has turned against both the U.S. Dollar and the U.S. stock market. It should also be noted that this group is European based and is not in New York City and thus they have lots to gain from a declining U.S. Dollar and a rising Euro.

After reading this article, I was reminded of another article about the Bradley Indicator which has been calling for a stock market top around August 6-7th and then a downhill slide until early December. I have watched this indicator over the years and it tends to be 75% reliable, which means it has a very high degree of probability in this business. Couple this fact with ongoing events in the Middle East and a possible European/Russian connection to sell off the U.S. Dollar on or about August 19th (as reported in an earlier post last Wednesday) and we have the makings of some exciting market action. One client of mine suggested today that the U.S. Administration is talking about bombing Iraq now ostensibly to curtail Saddam Hussein's war machine and missile capabilities, but the real story is to get overseas investors to hold onto their U.S. Dollars instead! Remember what happened during the Gulf War? The U.S. Dollar and U.S. stocks were the best performers! Do they expect us to behave as Pavlov's dogs, slobbering all over ourselves when the bombing begins? Only time will tell and we don't have long to wait. Personally, I will be watching the U.S. Dollar Index, crude oil and gold from this point forward. Also, if the Dow Jones Industrial Average breaks under 10,000 decisively, then watch out below for the unravelling of the U.S. stock market will have begun.

Black BladeRE: wiley msg#: 59073) - Pobre Prairie Chicken#5910908/06/01; 18:47:50

I am on the road right now (Sturgis Rally) and just checked in before having a meal with some friends (even some Kalifornian Grasshoppers). Your post caught my attention. It is interesting to read the lies perpetrated by the environmentalists' extremists.

Note: Steve Capra of the New Mexico Wilderness Alliance disagrees. He said two frequently drilled areas - the San Juan Basin in the Four Corners area and the Permian Basin in the southeastern part of the state - are proof of the damage the oil industry can do. Power lines, pipelines and gas rigs cover the land and the smell of gas pollutes the air, Capra said.

For one, this is a natural gas (methane) project. Natural gas is odorless and the odor detected by the homeowner is added after the fact by the NG utility for safety reasons. Two, the pipelines are underground and are connected to the wellheads at the site. Three, there are very few drill rigs left anymore as most went to the scrap heaps after the last energy crash.

As far as the Prairie Chickens being upset about the drilling, infrastructure, etc. I would not know. In the Powder River Basin, Wyoming we have coveys of Prairie Chickens en masse. In fact here we refer to them as "herds." They are stupid birds as you can practically walk right up to them. So I don't see them as feeling one way or the other about the presence of man. We also have herds of deer and antelope. They seem to relish the ground water that is made available. The ground water is also made available for drilling where it infiltrates back into the ground. I guess these people need a cause to make their lives somewhat meaningful and to "feel" as though they can "make a difference" in the World. Man seems to always have a high opinion of himself and his abilities over nature. In the overall scheme of nature, man is insignificant. Quite an amusing article - Thanks. Cheers!

- Black Blade

Hill Billy MitchellLeigh @ # 59091#5911008/06/01; 19:17:23

Lady Leigh

One can be an American, a citizen, without necessarily having been a natural born citizen. A naturalized citizen is in similar circumstance as an adopted child. The adopted child has all the legal rights of a biological child. But the adopted child, unless the facts of adoption are kept from the child, always seems to yearn for the biological parents. I am not suggesting that TG is anything at all. I am interested and my curiosity arises from the fact that he does not seem to indicate any strong loyalties to the U.S.

Is it unhealthy to ask pointed questions? I am an American also. My loyalties lie with the United States of America only as I am very nationalistic. Being nationalistic is not so politically correct anymore. Nationalism (I do not mean Fascism – national socialism) was welcomed, even encouraged, when I was in high school 36 years ago. Things began to change about that time. The change, to be sure, has been accelerating since the early to mid-sixties.

Bill Clinton represents that change. We are the same age and we are both male in gender but the similarity stops there. I was drafted into the U. S. Army and went to Viet Nam. He avoided the draft and went to the Soviet Union. I love the constitution of the United States and he treats it with disdain. I could go on and on but you get the picture: Bill Clinton has done great damage to most everything I stand for. I offer this as an illistration as as to why I would like to know as much as possible about a person who has as much influence the readers in cyber land.

ANOTHER and FOA/TG are a great mystery to me. I can understand the need to keep certain confidences if you are in high places or if you are passing along information from high places. I am not asking TG to compromise himself or his sources. I just happen to be a very skeptical person by nature and would like to know more about him. If he were a Bill Clinton sort, I would certainly like to know it. If he were a John Adams sort or Thomas Jefferson sort, I would certainly like to know it. There are those out there who would say that this is personal and none of my business. Fine, say it. If this is a free country you have a right to call my questions into question. I have the privilege of asking pointed questions, questions, which I suspect are of interest to others as well. Unless my privileges are revoked I intend to ask pointed questions which are of interest to me.

I would prefer to think that TG is a patriotic U. S. citizen. He has given us no real indication as to whether he or is not. I would like for him to say so. He may choose to ignore me. I will prod him again someday if I get the chance even if it bears no fruit. This should be understandable. He does not have to give me the light of day. He can ignore me and usually does. That is fine.

Might I say that his thoughts and ideas could and should be defended by those who care to do so. However, I was hoping he might answer for himself. He is not at a loss in the area of communication, that's for sure. My post was not meant to be a personal character attack. I was trying, hoping to bring him out of the mist.

I personally would like to know all I can about a person who writes such things as he does. Surely you can see that I meant no harm to him or anyone else. I guess what I am trying to say is that I already knew the same things that you knew about TG. I was hoping for new information. If all of his readers respond for him then the chances of a response from him are lessened.

We shall always be friends. I do hope you take no offence at this post. I took none at yours but took your post as an opportunity to more clearly explain my purpose in the post. Had I chosen to post this to White Hills instead of you all would have treated my post as a vindictive counter punch. Most who read this forum are aware of our friendship and common interests. So you see why I singled you out for this post. No one could think that I would mean you any harm.

Very respectfully,


PS: TG if you read this I would like to ditto Gandalf the White Post #: 59095 - Greenspan Reportedly to Retire #5911108/06/01; 19:18:21

Exclusive: Greenspan Reportedly to Retire
Wes Vernon
Tuesday, Aug. 7, 2001
WASHINGTON - Federal Reserve Chairman Alan Greenspan will announce his retirement by the end of year, administration sources have told
The longtime head of the world's most powerful bank has already indicated to administration officials that they should begin a search for a replacement.

Greenspan, 75, who has savored the limelight for more than a decade, is now said to be anxious to make the move, and hopes to be in the private sector sometime in the first half next year.

Speaking on condition of anonymity, an administration source said that Greenspan may be trying to end his public career on a "high note," as more evidence mounts that the U.S. is teetering on the edge of a recession.

Several Wall Street insiders said that such a move by Greenspan would probably be a smart move, considering he could easily become the fall guy for economic slowdown.

Already, top officials in the Treasury Department and the president's economic advisers have expressed simmering upset with the Fed chairman, though relations between him and President Bush are said to be excellent.

Federal Reserve spokeswoman Michelle Smith refused to confirm or deny the report, saying it was Fed policy "not to comment on rumors."

Greenspan, appointed by President Ronald Reagan to replace Chairman Paul Volker on Aug. 11, 1987, has been the most influential and high-profile Fed chairman.

He was reappointed to successive four-year terms as chairman by Presidents George H.W. Bush and Bill Clinton. Bush appointed him to a full 14-year term as a member of the board in 1993.

Role in Clinton's Victory

Reportedly, G.H.W. Bush was miffed by Greenspan's handling of interest rates, which led to a brief economic downturn shortly before the 1992 election, when Bush lost to Clinton.

Greenspan's latest term as the Fed's top man began June 20, 2000, having been picked again by Clinton. A resignation before the end of this year would come more than two years before his chairmanship expires.

Critics and supporters of Greenspan acknowledge that he has presided over the largest economic boom in modern history.

That boom is appearing to fizzle, after a stock market technology bubble burst in March 2000.

Noted stock investor Sir John Templeton called the 1990s stock market run-up as "the biggest financial insanity ever in any nation in history."

The administration has applauded Greenspan for moving to restimulate the economy. He has cut interest rates six times this year, frantically cutting 2.75 points from the Fed rate, which reached a recent peak of 6.5 percent last year.

Administration sources have welcomed those steps and anticipate another rate cut in two weeks when the full Federal Reserve Board meets on Aug. 21.

Still, sources reveal that administration officials blame Greenspan for the economic morass. Recent corporate earning reports show a fall of 17 percent during the same period last year, with little hope for a quick turnaround.

Trying to Help Gore?

"Greenspan knew the economy was overheating, and he waited to the last possible moment to raise rates," the source said, suggesting that the chairman did not want to hurt Al Gore's chances in the 2000 election, and waited to long to put apply brakes to an economy that was racing too fast.

During the 1990s as consumer debt soared, tripling since 1992, Greenspan kept rates low. Late into the Clinton administration, he led the Fed as it raised the Federal Funds Rate six times, beginning in November 1998, to 6.5 percent in May 2000.

Greenspan was well aware that interest rate changes have a lag effect of three quarters, meaning his increased effort to cool the economy began having an effect only in the last quarter of 2000, after the presidential election.

Cozy With Clinton

Other administration sources told they have been flabbergasted to learn of how cozy the Federal Reserve chairman was with the Clinton White House and Treasury Department officials in coordinating monetary policy.

During previous administrations, the White House and the Fed chairman, for their own political reasons, have sought to stay at arm's length.

One source noted that when Reagan asked to meet Fed Chairman Volker for the first time, Volker declined to meet him in the Oval Office. The pair agreed to meet on neutral ground at a conference room in the Treasury building next to the White House.

Overtures to Bush

Greenspan has sought to make friends with the current Bush White House in the most unseemly way. Critics of Greenspan leaked to columnist Robert Novak that Greenspan had engaged in inappropriate politicking at the White House.

Novak reported that on the day before an interest rate cut in April, the Fed boss "was roaming corridors of the White House West Wing — shielded from the eyes of inquisitive reporters." He visited Vice President Dick Cheney and National Economic Adviser Laurence Lindsey and "presumably tipped them off about his unexpected move."

Some Bush administration officials have been privately critical of Greenspan for being too slow in cutting interest rates. Nonetheless, says Novak, they have adhered to a rigid rule against public comment on the Federal Reserve.

Treasury Secretary Paul O’Neill and Greenspan have a friendship that goes back to the days of the Ford presidency. They still meet regularly.

Black BladeGas prices will rebound next year from nuclear outages, analysts say #5911208/06/01; 19:28:26


HOUSTON, Aug. 6 -- Natural gas prices may rebound next year thanks to decreased nuclear power production, Raymond James & Associates said. Nuclear power is headed for a "cliff" next spring as power plants go off line for planned maintenance outages, analysts said. Demand for natural gas will increase on the strength of reduced nuclear power generation. Lower nuclear generation should boost gas demand 1-1.5 bcfd by May 2002 to serve gas-fired generation, said Fred Schultz, analyst with Raymond James in Houston. He estimated nuclear power generation replaced 1.5-2.5 bcfd of gas demand in gas-fired electric generation this summer. That offset is expected to continue into the fall when gas prices will finally bottom out, Schultz predicted. By next spring, gas demand and prices should improve dramatically, Schultz said, creating an "astounding" 3.5 bcfd swing in gas demand. Schultz predicts almost a 17% month-over-month switch from nuclear power to gas fired generation from April to May of 2002.

Black Blade: Add in a cold winter and the economy is in trouble as blackouts and increasing higher energy costs resume. So much for the Barron's article calling for a "Glut of Energy." That could be a sign of things to come. The Economist had a similar article calling for a "Glut of Oil" in 1998 just before the current energy crisis began. These periodicals have been great contrary indicators. You can't hold barrels of oil as portfolio insurance - but you can hold other hard assets like gold and silver.

Friends just arrived - Got some beer "Drinkin" to Do.

LeighHill Billy Mitchell#5911308/06/01; 19:44:24

HB, if someone runs up to you and tells you your house is on fire, would you ask them what their deep beliefs and motives are? Or would you hurry to check out the information for yourself?

I don't know how Trail Guide feels about the Constitution or whether he's an American patriot. However, I do know that he's spent a vast amount of time here trying to warn us about the threat to the dollar and the need to buy gold. I have seen and heard enough to believe he's right. And I've adjusted my portfolio accordingly.

Are you going to ask ANOTHER about his deep beliefs and whether he's an American patriot? (That would be funny!) We know he believes very differently from us. But his message is still valid and based upon economic truths.

I know from your previous postings that you also believe that America as we know it is doomed and rightfully so. Trail Guide, whatever his personal belief system, should be applauded for trying to explain the whys, hows, and whens. He seems to know what the other side is up to, and he's willing to share some of his knowledge with us. Let's thank him rather than put him through an inquisition about things that are none of our business.

Cavan ManLeigh#5911408/06/01; 19:58:18

Sir HBM is from the "Show Me State".
Cavan ManHill Billy Mitchell#5911508/06/01; 19:59:25

Thank you for your service to our country.
Hill Billy MitchellLeigh @ # 59113#5911608/06/01; 20:12:36

Lady Leigh,

He also has done a masterful job of making the coming hegemony of the Euro sound like the greatest idea since Swiss cheese, no? I rather think it is an example of two wrongs (US$ hegemony and Euro hegemony)making a right. My position does not detract from his. By the way, which ANOTHER were you referring to?

Very respectfully,


PS: I am sure he is smiling at this banter. I am. It is about time things livened up around here.

Hill Billy MitchellCavan Man @ # 59115#5911708/06/01; 20:16:36


My privilege and my honorable duty. You are welcome. I am not sure, but I do not recall anyone ever saying that to me. I was not soliciting or expecting any thanks but it made me feel especially good.

Very respectfully,


LeighHill Billy Mitchell#5911808/06/01; 20:29:13

Well, hey, HB, you don't have to agree with everything he says to know the dollar's doomed! Let him believe what he wants to believe. I don't agree with all that European Union talk either, but I just scroll on past it.

I'm talking about the ANOTHER who said "All paper will burn." Is there an imposter??

Max Rabbitzabudahhab....very interesting.#5911908/06/01; 20:38:57

Looks like the thrill is gone for Mr. G. But the damage is done. Did Mr. G. really try to leak insider information to Dick Cheney and Laurence Lindsey before the last rate cut? Who else has he been leaking to? Perhaps when this is over we will abolish the Federal Reserve and it's cabal of bankers. A second American Revolution. Maybe we can fund the new treasury with HBM's gold stash.

Lowering interest rates and increasing "liquidity" won't solve the problems despite what Larry Kudlow thinks. Massive bad investments in a bubble economy, made possible by fractional reserve banking, destroyed real assets that should have been put to better use, such as energy.

NetkingUS lay-offs hit record high#5912008/06/01; 22:51:04


Fears over the health of US companies have been rekindled by a report showing the number of jobs cut last month surged 65% to a record high. The number of layoffs announced by US firms in July hit 205,975, employment firm Challenger, Gray and Christmas said.

The figure, the highest since the report was first compiled in 1993, was more than three times the number of redundancies recorded in July 2000 . . . .

Black BladeU.S. firms' layoff plans skyrocket#5912108/06/01; 23:43:35


NEW YORK, Aug 6 - Layoffs announced by U.S. companies soared 65 percent in July compared to June, hitting the largest single-monthly job-cut total recorded by outplacement firm Challenger, Gray & Christmas, Inc. since it began its survey in 1993. ANNOUNCED JOB CUTS rose to 205,975 in July, up from 124,852 in June, more than three times the job cuts recorded in the same month last year. In the first half of 2001, U.S. corporations said they planned to cut 777,362 jobs, more than three times the number announced during the first six months of last year.

Black Blade: Not good. The talking heads and Pied Pipers are spinning this as not real. One Pied Piper (or Harpy) named Diane Swonk claimed that the numbers are lies. Indeed, it must be a "conspiracy" ;-)

Black BladeThings were not as they seemed#5912208/06/01; 23:53:30

Profits of the great bull market weren't as hot as we all thought


Rising profits were one of the pillars of the great bull market of the late 1990s. Now it looks as if that pillar was not as sturdy as we thought. The government last week quietly revised its measure of profits for the years 1998,1999, 2000. The new calculations show that corporate profits were actually about $135 billion less than originally estimated. If you think this is news only an accountant could love, think again.

In economics, profits are inextricably linked to other things, such as the cost of labor and productivity, both of which now look less dazzling after the revisions. Add up all the new numbers and the conclusion is a depressing one. ''The new economy was not as good as it first appeared,'' said Fred Breimyer, chief economist at State Street Corp.

Richard Berner isn't so sure. ''The consensus forecast on earnings for next year is still way too high,'' said Berner, chief US economist at Morgan Stanley. If Berner is right, and we are all still wearing rose-colored glasses, then investors may be in for some future shock when reality fails to meet expectations.

Black Blade: What? Profits are important? Maybe there is something to tomorrow's prediction after all - though the timing is probably off.

NetkingAuspec / Belgian - Silver short positions#5912308/07/01; 00:03:31

Sir McAuspec said(59034): " . . . per your recent post #59021: "Silver is a very, very small market {compared with gold}, however the short position and leasing is much greater for its size than that of gold or any other commodity we could compare it with."

I really have no reason to doubt this statement, but would love for you to expound on it a bit, especially in relationship to the sise of the silver market vs the gold market. The gold short position is likely in the vicinity of 15,000 tons with CB overall holdings {as far as we know} at 32,000 tons. How does silver 'quantify' in relationship to these numbers? . . . The supply/demand numbers have been out of kilter and analyzed for all to see clearly since at least 1993 with Jim Blanchard's "Silver Bonanza" was put out. The manipulation was unapparent at that point, however. It is mostly guilt by association including the silver manip with the gold manip. Very grateful for the PE giving away their hand and letting us in on a major accumulation . . . McAuspec
Sir Belgian said:(59028)Indeed Good Knights...if there are some very strange, fundamental anomalies, not easely to be explained...we can always blame it on the unknown effects of the massive, overwhelming derivatives ! We and many others are surely underestimating the devastating effect of these derivatives on the natural proces of valuations ! I've always called it "speculative mania" but have been corrected by TG into rightout naming it "Gambling". The temporary periods of "price containment", (Rich) are probably the moments that the gamblers are stucked and the game is immobilized, waiting for some new blood.

Good comments/questions (per above) Sir McAuspec & Sir Belgian.

I asked Ted Butler(PM analyst)some questions on this (he knows this market better than anyone)& he very kindly replied with some excellent analysis(posted below).

There are three components to the silver short position - COMEX, OTC, and leasing/forward selling. OTC (including the LBMA) statistics are unavailable or unreliable, so that leaves only the other two for analysis. But there is
an OTC position, that adds to the other two. The COMEX silver short (futures and call options) position is over 131,000 contracts (77,645 futures, plus 54,616 call options, as of the close of business 8/3/01), or over 655 million ounces of silver. Since world mining production is under 600 million, and because no one can verify more than 150 million ounces of silver bullion, the COMEX silver short position is greater than either world production, or world verified inventories.

If you take that short position, and do the same thing for every other listed (exchange traded) commodity, and compare the quantity of the commodity represented in the combined futures and call option open interest to world production and verified inventories, only in COMEX silver will you find the short paper position exceeding world annual production and/or known inventories. Only in COMEX silver, is the listed short position larger than all the silver mined in the world for a whole year, and also larger than all known world inventories. Ask yourself a question - how is it possible that there can there be a bigger short position of anything real? And, if you could imagine a short position bigger than what existed in the real world -
what do you think the effect of establishing that short position on the price would be? In fact, I wrote an article about this, a few years ago -

As far as leasing/forward selling, the leasing short position is in addition to the COMEX (and OTC) short. It's easier to track the short leasing position in gold, because the miners have to report their forward sales. That's more
complicated in silver, because fabricators and users also borrow metal, but there are some big short miners like ABX and Pasminco. The key to the silver short lease position is that, while it is only a fraction the size of the gold position dollar-wise, it is much bigger ounce-wise. In gold, we can document a 5000 ton lease short postion. That's two years production, or 160 million ounces, or almost $50 billion. In silver the same two years prouction
comes to only $5 billion, or 10% of total gold loans, on a dollar basis. . But, it is also a billion ounces of silver, or more than 6 times the amount, in ounces, of the gold short. This billion ounce silver short position also explains where in the world we got the silver for the deficit over the past decade, with no increase in price.

Because metal leasing is all about physicals being dumped on the market, the end of leasing is all about physicals not being dumped on the market. Because the physical numbers in silver leasing are so extreme, as is the entire
silver short position, the effect on the price of silver to the downside has been so extreme. But, if you want to talk price extremes, wait'll see the effect of all this shorting on the price of silver on the way up.

Black BladeLiving on borrowed time#5912408/07/01; 00:12:21

U.S. lenders keep loaning despite downturn


SAN FRANCISCO (CBS.MW) -- U.S. consumers' creditworthiness has deteriorated with the economy, but that hasn't curbed the rate at which lenders are feeding the nation's dependency on debt. Despite increased unemployment and home foreclosures, record personal bankruptcies and massive stock market losses, America's financial institutions boosted consumer loans by 10 percent to $1.59 trillion in the last year. The rise is driving the average household to spend 14.3 percent of take-home pay on debts -- and raising the specter of a looming credit crisis if the economy continues to worsen.

Lenders prepare for consumer defaults. Lenders are "foisting credit upon people who not only don't necessarily deserve it, but who are not technically credit-worthy borrowers perhaps at any interest rate," said Keith Gumbinger, vice president of HSH Associates, a publisher of mortgage and consumer loan information.

Black Blade: Ya know, a bank (Superior Bank of Chicago) recently went tits up because of unworthy loans. Am I the only one who thinks there might be a problem here? Hmmm…

A friend of mine took out a second mortgage, paid down some debt, and went on a spending spree. His wife recently got laid off from a high profile high tech firm. Anyone wonder why I advocate getting out of debt and staying out of debt? Wonder why I advocate very selective investment in few sectors? Wonder why I advocate hard assets like gold and silver for portfolio insurance? In the last scene of the movie "The Terminator" a young Mexican boy points toward the horizon and says "Hay viene un tormenta" (There's a storm approaching). Indeed!

Black BladePower Glut?#591258/7/01; 00:51:26

Over the weekend Barron's magazine suggested that power plants now under construction or planned will be more than enough to meet power needs over the next five years.

That is impossible. Let us examine some very basic facts here. These power plants are NG-fired. 1) There are no more drill rigs to explore and produce natural gas. The number of rigs has nearly triples since 1998 and there has been only about a 2% gain in natural gas production - this without the new and planned NG-fired power plants in action; and 2) the costs to produce natural gas, growing demand, and restrictions on acquiring natural gas from most likely exploration absolutely targets guarantees that there will be a continuous energy crisis. It seems that in 1998 "The Economist" made the same prediction about oil that it would be $5.00/bbl forever. The POO went up to $40.00/bbl in short order and the editors of "The Economist" had a lot of egg on their collective faces. They never recovered. The editors of Barron's will have the same fate because they too simply did not do their homework.

BTW, Hurricane Barry cuts domestic hydrocarbon supply, rolling blackouts in Minnesota as Xcel asks customers to conserve energy during heat wave - ditto in the northeast, ditto in California, PG&E asks state to allow rate increases due to higher energy costs, etc. ad infinitum.

- Black Blade

Golden dreams All!

NetkingHarmony closes 400,000 ounces of hedge book . . . #591268/7/01; 02:37:52

. . . in preparation for a rise in the POG.

Harmony has reported that it has closed 400,000 ounces of gold of its hedge book since the end of March.

The hedge book was reduced by 170,000 ounces in the quarter ending in June yet the weak gold price in recent weeks prompted a further reduction of 230,000 ounces.

The reduction comes as Harmony's bid to be one of the least hedged gold producers in South Africa and also to provide the company with the chance to take immediate advantage of any rise in bullion prices.

diehardDr Kurt Richebächer - Copy , Extract #591278/7/01; 02:40:31


July 2001

We're convinced that Dr. Kurt Richebacher is the most important economic thinker in the world today. His newsletter is expensive but crucially important. Here are a few pages from his July 2001 newsletter:

There is always quite a lag between changes in interest rates and noticeable changes in the economy's behavior. But considering the extraordinary scale and the speed of the rate cuts, some first effects ought to show by now. Not only have they failed to prevent the further economic weakness, most peculiar and most ominous is the miserable failure to lift at least the financial markets.

Booming stock and bond markets have preceded every economic recovery. The normal sequence in the business cycle is: booming money - booming financial markets - economic recovery. The only aggregate presently booming is the broad money supply (M3). What is the source of all this money? What are the economic or financial processes involved? We shall explain why this rampant money creation has so little or virtually no effect on the economy and the markets.

Looking for the most reliable economic indicator, we recommend profits. They are far more than just an economic indicator. By directly stimulating or retarding investment spending; they are really the primary, moving force behind the business cycle. Rising profit expectations is the absolutely indispensable condition for economic recovery. The signs of an investment collapse are everywhere, in particular in the steepest and most rapid slump of profits in the whole postwar period. Although muted by several factors, domestic nonfinancial profits fell in the first quarter 5.1% from the fourth quarter of 2000 and 14.5% from a year earlier. This compares with nominal GDP growth of 5% year-over-year. S&P after-tax earnings per share fell 31.3% from a year earlier and operating earnings 2.1%. Manufacturing profits are at a six-years low. Profit margins are at their lowest level in seven years. Only false optimism about the economy's impending recovery has prevented a worse rout in equity markets.

Waiting for the U.S. recession, essentially showing in a decline in real GDP, seems to resemble the wait for Becket's Godot. Well, Godot never arrived. In contrast, the U.S. recession will definitely do so. While economists and investors have cheered the Fed's rapid, sharp rate cuts and the fact that GDP has not yet dipped into negative territory, the unfolding downturn is, nevertheless, manifesting most ominous features that distinguish it negatively from all prior postwar cycles.

The false optimism is clearly shaped by the regular postwar experience with recessions and grossly inflated faith in Mr. Greenspan. Never before have rate cuts by the Fed failed to accomplish prolonged stock market rallies and economic recovery. Unfortunately, there are compelling reasons to assume that this time is the first, great exception from this rule. "Men like dogs", borrowing from Keynes, "are only too easily conditioned and always expect that, when the bell rings, they will have the same experience as last time." The decisive distinction, readily ignored, is that the economic conditions propelling the U.S. economy's present downturn have nothing in common with the cyclical fluctuations of the past, reflecting just short-run inventory corrections.

As we have repeatedly stressed, the difference is twofold. The one is the downturn's unusual speed, and the other one is its unusual shape. As to the speed, violent boom turned to violent bust within little more than six months. Over less than a year, from the first half of 2000 to the first quarter of 2001, real GDP growth has tumbled 4 percentage points, from 5.2% to 1.3%, both at annual rates. As to their composition, past downturns were centred in a rundown of excess inventories. This one reflects collapsing fixed investment, a drastic slowdown in consumer spending and, worst of all, unprecedented carnage of corporate profits. Inventory correction has just begun.

It keeps us wondering and wondering how the Wall Street gurus manage to preserve their complacency about the U.S. economy's state in the face of the shockingly bad economic and profit data. They have, of course, tremendous experience in duping people, their customers and themselves. American statistics about economic activity are the most comprehensive and the most up-to-date in the world, yet it strikes us how little of all that information is actually finding its way into recognition and public discussion.


Trying to judge the economy's further development, scrupulous scrutiny of underlying conditions is clearly incumbent. Yet we see very little of it. As we have many times stressed, understanding the specific pattern of the downturn is crucial for judging both its course and its implications. Regardless of manifest, contrary evidence, the consensus sticks to the deceptive version of an inventory correction. Announcing its last rate cut, the Federal Reserve declared in its associated statement that the inventory correction was "well advanced". Actually, inventory correction has in the first quarter of this year just started with a paltry decline by $ 7.1 billion, after a $ 60.5 billion increase last year. The inventory sales-ratio for businesses as a whole was in March at 1.37, after 1.32 a year ago. .

Profits are the most important issue requiring utmost attention. Remember: The aim of production in the capitalist economy is the pursuit of profit by businessmen. "Take this away and the whole process stops". (Keynes) Within just two quarters, profit margins fell in Q1 to their lowest level since early 1994. Here too, it is amazing how little attention the profit drama finds.

The profit carnage has come as a shock to corporate managers. But the other most important thing to see is that the trumpeted "profit miracle" of the late 1990s never happened. The story was complete bogus. After-tax, nonfinancial profit growth from $ 403.8 billion in 1995 to $ 527.3 billion in the fourth quarter of 2000 works out as an average annual increase of 5%, in current dollars. If you deduct the inflation rate, real corporate earnings grew by no more than 2-3% per annum. For a booming "new paradigm" economy, this was worse than miserable. With the weakening economy, badly disappointing profits have suddenly turned into collapsing profits. By the way, we presume that these aggregate numbers take no account of the big losses that have accumulated in the high-tech sector over the years.

The immediate effect has been the worst investment bust in the postwar period. Growth of fixed investment has in the course of 2000 plunged straight from 16.4 % in the first quarter to

–0.9% in the fourth quarter. Within the aggregate, investment in equipment and software dived over the year from 20.6% to –3.3%. But since the brunt of the profit squeeze has been on undistributed profits, corporate cash flow is in addition down. The ratio of cash flow to nonresidential fixed investment, at 72.2%, is at its lowest level since the third quarter of 1982. During 1991-99, this ratio has averaged 84%, fluctuating between 74% and 94%.

Considering the foreseeable influences on profits, it is beyond any question that their fall is sure to steepen in the course of the year, intensifying the investment bust with major negative consequences for consumer income and spending. Orders and shipments in particular for ITC goods keep sliding. In April, such orders fell by 10.3% in nominal value and shipments by 6.9%.


Gross neglect of most important, negative facts is the one thing that surprises us about the public discussion of the present U.S. economic downturn; utter lack of understanding and appreciation for the inherent macro financial and economic issues throughout the financial community is the other one. Elementary insights into economic processes that have been accepted by all schools of thought ever since systematic, thinking in economics started more than 200 years ago are unknown, discarded or even put on their head.

Compared to Europe, American economics has traditionally been short of theory and long in statistics. Yet today it's virtual anarchy at the macro front. Protracted runaway credit and money expansion, negative personal saving, a massive shift in resource allocation towards consumption, and a balance-of-payments deficit of monstrous size, all these egregious financial and economic maladjustments have for American policymakers and economists zero relevance. Rather, the New Theory of the New Economy elevates them to hallmarks of economic dynamism.

For ages, economists of all schools of thought have regarded the equilibrium between saving, credit supply and capital investment as the central problem in economics. No knowledgeable economist would have equated rising stock prices with "wealth creation". The crucial difference between national capital wealth and personal wealth used to be well known to everybody. As formulated by Ricardo, "capital is that part of the wealth of a country which is employed in production". And these economists also had a clear perception that there is but one single way how such (productive) capital can be created: through domestic saving. Adam Smith postulated: "that parsimony, and not industry, is the immediate cause of the increase of capital. In his book "Keynesianism vs. Monetarism", Prof. Kindleberger quotes a remark of Adolphe Thiers, French Finance Minister, 1865-7, in a speech to the Conseil Supérieur: "It is impossible to create more capital than society creates through savings." Quoting a more recent American economist, Prof. J. Laurence Laughlin, Credit of the Nations, 1918: "Credit does not create capital. Capital functions as economic goods are given over mainly to productive uses, and originates through saving." In the same vein, by the way, it used to be commonplace knowledge that credit growth in excess of available savings is the source and the measure of excessive consumption, investment and speculation.

What is it that caused the old economists to rank "saving" so high in their economic model? In short, owing to its impact on the economy's resource allocation. To the extent to which people consume less than their current net income, they provide the factors of production that are required for the production of plant and equipment. This release of resources for capital formation is saving's vital macroeconomic function that accrues exclusively from saving out of current income. This has always been the all-important macro aspect of saving, and that's what Adam Smith meant with his statement that parsimony, and not industry, is the immediate cause of capital. Ultimately, the rate of saving sets the limits to non-inflationary capital investment. And that's also the compelling reason why official statistics worldwide treat only saving from current income as "saving".

This insight into the macroeconomic essence and function of saving used to belong to elementary knowledge in economics. The first to have completely lost sight of it are today's American New Economy apostles. Equating realized capital gains in the stock market with saving reveals total macroeconomic illiteracy. Plainly, they have the exact opposite effect on the use of resources: To the extent that wealth effects boost consumer spending, they decrease capital.

The crucial, precarious aspect of the negative saving rate is that it reflects an unprecedented, bubble-related escalation of consumer spending. If the Fed's drastic easing fails to revive the bubble, the massive overspending by the consumer will burst just like the massive malinvestment of businesses in high tech.

These are the first three pages of Dr. Richebacher's 12-page July newsletter. To read the rest you need to subscribe as follows:


808 St. Paul Street

Baltimore, MD 21202

Or call 1-800-433-1528

Belgian@ Netking # 59123#591288/7/01; 02:55:23

Good morning to you Sir,
Thanks for adding some info on the silver-short-enigma :
Let us be honest and conclude that up until now there is no satisfactory / precise and complete, explanation, for this long term silver aberation (spelling ?). Glad to see that your sources started to look into other raw materials's history, in search for similar situations. And if we find a commodity (cacoa) where the same LT price is is always to be explained with the "over-supply" of it. Oversupplies, organised by monopolists (globalization) and produced under enslaving conditions, that are carefully hidden. But in those price charts we do see much more regular fluctuations and signs of supply/demand cycles. Cyclic behaviour instead of linear as to be seen in silver.
If there wasn't the Gold-management, the explantion for the long depressed POS, would be simplier to accept. Officials unloading obsolete stocks (US) and silver as a mining by-product. Reason for the long term non-cyclic pattern.
There are no official stashes of strategic coffee/cacoa reserves.

My amateuristic intuition tells me that we are overlooking something here. Did you ever hear from silver-miners (producers) talk about the miserable price situation of their product ? Do you hear defensive argumentation from silver-holders (the heroes à la Buffet/Gates) other than silver advocates ?
And why isn't the silver aberation not brought into connection with Gold, if there is to be a connection.
Most of the fundamentals of many other commodities, do have outspoken explanations. The only one I don't have any handle on, is silver. Every approach on silver is vague and unsharp to me. Are silver-consumers the main culprits for price depression as to defend photography against the digital fashion ? What is the reason that silver-demanders are so much stronger than the silver suppliers ?

If tomorrow, silver-price should explode without the POG -lead, wouldn't that be evidence for all to see that there is something wrong with the free market on physical gold ?
And that this fundamental is the reason why "others" are helping the silver demanders (industrial) to keep a permanent lit on silver ? Gold and silver have a complete different supply/demand situation. How can they possibly act (be under-valued) as the same commodity ?

NetkingBelgian #591298/7/01; 04:07:40

Belgian > Let us be honest and conclude that up until now there is no satisfactory / precise and complete, explanation, for this long term silver aberation (spelling ?).

Netking - I believe you're almost there Sir. Yes things are "wrong" with the fundamental demand & supply free market dynamics in the Ag market.

With such a small worlwide inventory (with nothing more than 150 million ounces of silver bullion that can be confirmed)& a continuing yearly supply deficit for over a decade & prices on a 5,000 year inflation adjusted low . . . something is VERY wrong.

The answer is under your nose, short selling & leasing. As mentioned (in the earlier post) below, the short position with just Comex alone is at around 655 million ounces compared with silver bullion inventory at around 150 million ounces . . . we've got a problem Houston!

Total remaining inventory is declining constantly through this continuing deficit, but over four times(4 x)this remaining supply has already been sold by the people who basicly don't own it, therein is an explanation Sir.(Your spelling is not bad at all Belgian, all depends where we live right!<grin>). - Netking

nickel62(No Subject)#591308/7/01; 04:14:26

Some random thoughts on silver..Belgian

The silver mines that are primarily silver producers rather than a mixture of metals have long since proven uneconomic in most of North America, with the notable exception of Mexico. $6 per ounce was a major point at which they failed to have a viable life, and that was twenty years or so ago. The bulk no comes out as by products as you mentioned and is simply a factor in determining the net cost of the gold or zinc or copper that is the main target of the mining. All of this is most likely fairly well worked ground in the silver debate,but the lack of response from the silver factions is at least partly due to the fact that the silver producers who were primarily focused on that commodity have been pushed to the wall many years ago. We unfortunately are watching the last of the main gold producers in the US (Newmont) be minimalized in the same fashion.
Spartacus(No Subject)#591318/7/01; 05:40:37


" The US has had the rest of the world in somewhat of a trap also. For a long, long time. Perhaps from when we told them that the world gold exchange standard bearer would no longer ship gold for dollars. From that point on we (USA) could inflate our money without consequences. "
" In the past if the system began driving the dollar too high and forcing US trade deficits, the Fed would raise rates to throw us (USA) into an economic recession that broke the vicious deficit trade cycle. Knowing full well that it would be a short recession policy because "noone" would jump the dollar ship before the medicine could work. Looking around back then and we see there was no other reserve currency ship to jump to. We either lose jobs and profits from an "overvalued currency" or from an induced recession. The first can lead to a financial breakdown, the lasts corrects things after only a short while. Naturally, we embark on the quick fix of a fast recession."
" There is no way the Fed can create a new recession now without everyone jumping ship for another currency reserve. There is no possible way the Euro Zone will suffer as big a downfall as the US in another policy induced recession. Just looking at their closed economy and debt structure tells that story by itself. Any US slowdown means a run for the Euro, yet weakness in the Euro means the US must inflate at a torrid rate. " (FOA (10/20/00; 14:00:07MD - msg#43)

" The other point is that the rest of the world has a huge vested interest in the Dollar. That's what they hold behind all their own financial systems. Any other currency can crack without affecting the Dollar greatly. No other currency can fail to be affected if the Dollar cracks. " (The privateer gold pages, February 2, 2001)

" However, the EU, unless it obtains a defacto "deficits without tears" reserve currency status displacing the dollar, will suffer a monetary contraction as the ECB and member banks would lose dollar reserves (measured in Euro) as the dollar falls against the Euro. The monetary infusion required to counterbalance this on the CB books in a "mark to market" regime (which they already follow) would make necessary the setting of official gold prices in Euro very high (and even higher in dollars) in order to inflate the asset value of gold on their books to a level that makes the books balance (the alternative is to absorb Euro from the banking system – and collapse it through illiquidity – or for the ECB to declare bankruptcy directly)." (ORO (01/29/01; 06:22:00MT - msg#: 46806)


USA : "inflate or die".
Euroland : "Free gold or die".

Is this the way it goes?

Black BladeRAT TO LEAVE BURNING SHIP!#591328/7/01; 05:56:23

Exclusive: Greenspan Reportedly to Retire


WASHINGTON - Federal Reserve Chairman Alan Greenspan will announce his retirement by the end of year, administration sources have told The longtime head of the world's most powerful bank has already indicated to administration officials that they should begin a search for a replacement.

Black Blade: Getting out while he can I suppose. This rat is leaving while the Titanic slips beneath the waves.

I'll believe it when I see it.

Black BladeTHE END IS NEAR; WE MEAN IT! #591338/7/01; 06:02:00


August 7, 2001 -- Doomsday watch

Today may go down in history as Black Tuesday. At least that's what Dresdner Kleinwort Wasserstein is predicting. In a note to clients last Friday entitled "Fraud!," Albert Edwards, DKW's global equity strategist in London, said U.S. productivity data due out today could trigger a stock-market crash. Investing in the U.S. productivity miracle, which has been credited with boosting the market bubble through the late '90s, "will in retrospect be seen as a sick joke. The markets will be forced to confront this harsh reality on August 7," wrote Edwards. "Make a date in your diary! The U.S. 'new paradigm' will then be officially revised away! The risks of an equity crash are high."

Black Blade: We could find out in about 30 minutes. Yawn!

BelgianTo the morning shift....#591348/7/01; 06:55:27

Netking + Nickel62 : Thanks for adding another silver piece to the jig saw.

Diehard on K.Richebacher : This man has the "correct" attitude on the (theoretical) big economic picture. He is representative for the kind of solid common sense, still to be found on the old continent. Yes indeed, "profits" and "savings"...that's what it is all about, now more than ever before. All present economic super optimists, will have to learn that these two basic fundamentals, can't be ridiculed for too long ! Glad you joined us here (Danke).

Spartacus : I do think that you "Named" the game correctly with inflate + free-gold or die ! You seem to be familiar with arenas. In what stage (phase) of the battle, do you think we are, at present ?

POO up 2% ! ( compare this with a 5%/year interest on money)
To emphasise that an increase of 2%/day is proportionally enormous. And the initial positive POG reaction was immediately countered.
This snapshot of oil//POG price-behaviour, tells me that we are not living in an economic environment that corresponds with the evidence of "natural" (logical) behaviour.
Oil and Gold against the IR perspective + currency sauce ($/€). Is it the paper-arena that is causing these permanent anomalies or do all these actors have different agendas and distorted relationships with each other.
Or do I simply see ghosts and am suffering from hyperconcentration(itis) ? Sure is that volatility and rotation remain on a high level. It was full mon yesterday and we are the 7th of august. Is there already a cure for my obstination . big:-)(-:

SteveHRate of decline in futures in Silver and Platinum Group Metals#591358/7/01; 08:02:16

would seem to indicate an increase in pressure on the PMM (precious metal markets). This same pressure does not appear to yet affect gold, perhaps because of the offsetting downward pressure on the dollar. This severe downward pressure may be marking the beginning of the end for the derivative-style metals markets and also prognosticate a depression-like influence on these markets. This could be as a result of having had a strong dollar too long and represent a fundamental imbalance occuring or about to occur.
Buena FeUNBELIEVABLE#591368/7/01; 08:10:20


08/07 09:03
U.S. Second-Quarter Productivity Rises at 2.5% Rate (Update2)
By Siobhan Hughes
.........Productivity Growth Rate

Productivity rose 2.6 percent in 1998, down from 2.7 percent first reported, and increased by 2.3 percent in 1999, less than the 2.6 percent first reported. In 2000, productivity increased 3 percent, compared with 4.3 percent initially estimated, the Labor Department said.

``The gains we thought we had made because of the technology revolution are still there -- they're just less dramatic,'' said Lara Rhame, an economist at Brown Brothers Harriman & Co. in New York............
The $ Cartel comes out this morning with guns & pens a blazing! Smoke over Iraq (oil) and smoke over Wall Street!

The $ is king for another 24hrs.

SOOOOOOOOOO predictable.......thanks Wall Street for keeping P/Au so cheap that I can buy more while you keep serving up tequila to the lemming masses!

How can analysts be blamed for overstating company's prospects when the gov. is the biggest culprit? Just look at those revisions they're ALWAYS in the same direction. Duhhhh

The jig will soon be up. The rest of the world is beginning to laugh at the king.

Buena Fepaper supply#591378/7/01; 08:24:08

The truth is the US Treasury has to dump (sell) 27bil of new bonds this week (ah...... the vaunted surplus is in the shop for revisions) so the patient (demand) must be given heart massage to keep it alive.
Buena FeBurp#591388/7/01; 08:32:37

I know a few late buyers of the tech mania who would like to revise last years peak in the NASDUCK bubble.
EconoclastNetKing#5913908/07/01; 09:28:48

Lately, I've been wondering, how much are my perceptions clouded by my beliefs?
To my perception and I'm sure most everybody here, the news you gave about Harmony would be a positive for the company.

Yet the market is selling Harmony on the news.

Interesting world we live in. Up is down. Black is white. Right is wrong.

I await the day when our beliefs allow us to bask in the sunshine of the truth.

All: Have a Golden Day!

Buena Fepreaching to the choir#5914008/07/01; 09:36:04

Further job cuts to plague the US in near future
By Andrew Hill and Mary Chung in New York
Published: August 6 2001 19:14GMT | Last Updated: August 6 2001 19:25GMT

US companies will continue to slash jobs in the coming months, according to a survey that paints a much bleaker picture than official figures. (YOU DON'T SAY!)

The survey contrasted with Friday's employment report, which showed that the US jobless rate was unchanged in July at 4.5 per cent, better than forecast............

......... "Companies are looking at their staffing needs for the balance of 2001 and the numbers do not present a very positive picture," said John Challenger, the firm's chief executive, in a press release. "If companies were anticipating a 2001 turnaround...we would not be witnessing the extraordinary number of job cuts." ........

Gold Trail UpdateThe Gold Trail Discussion has been Updated#5914108/07/01; 09:44:00">The Gold Trail Discussion has been updated. Click on the link to read the latest updates.
CoBra(too)-The Calm before the Storm ...#591428/7/01; 09:59:53

- The Dresdner, Kleinwort,(whatever happened to Bentson to be replaced by?) Wasserstein forecasted & expected SM meltdown was averted by a better than expected productivity #. What have you expected? - Well, I expected the usual BLS - Bogus Lies ... as inherent in Statistics. But even that may be beside point, as the numbers may well prove to be real, reached at other BLS #'s, which are derived by the bogus unemployment #'s, which are not even half the #'s as household statistics state.

- So the "spiel" or spin is going on - for a while, anyway. Fine, so today CSFB analysts feel most of the chip producers are still some 20 - 30% overvalued. A fact they didn't see before most of this sector has melted down 80-90% from their highs. You gotta luv them guys!

- Gold's back to the penny game, while silver was briefly bashed to new lows, it clearly shows they're losing the prowess to really paper over all their games by the printing press. The PGM's free fall may just indicate the intricate state of the economy's - free fall? - as the "Street" is between a "Wall" and a hard rock! - so to speak!

- And as the Euro becomes more of a fact - they again can't hold down the POO - phew, that's were the PTB meets its Waterloo!

- Alea iacta est - the dice have been cast ... as I rest my case to the peace of mind some gold and a little silver combined, hold for my family's destiny.

Hope you too - cb2

PS: The latest thunderstorm in my parts has effected a meltdown in my most valued computer parts - i.e. processor and motherboard - not a recipe for computer and chip makers, I hope!

Cavan Man@CB (too)#591438/7/01; 10:30:32

As I was fond of saying on the rugby pitch, "with you!".
Gandalf the WhiteSo HBM, that shreds all those guesses into little pieces !#591448/7/01; 11:00:26

But one MUST think that FOA was educated in a private school that did not use American English as the primary language ! OR, why the grammical errors of dangling participals, "noone" for "no one" and use of the hyphen for contractions like "it's" for "its" (rather than "it is").
BUT, we can understand the message even with these tricks !! Indeed marks of a very tricky GIANT !

site stewardIf it ain't yellow, it ain't lookin' very good...#591458/7/01; 11:38:13

Silver has fallen today to its lowest London fix in eight years, down nearly 10% on the year.

According to this Reuters article, China's silver sales for the past two years have weighed on the market. For perspective here and now, China had issued 280 tonnes of export quotas for silver last year (2000), but China has recently added 500 tonnes to its export quotas for this year, lifting the 2001 silver export quotas to 920 tonnes.

Platinum has fallen to an 18-month low, down 27% since this year began.

Meanwhile, palladium has been the ugliest, down over 50% since New Year's day.

This article cites traders saying that "Japanese trading houses may have shipped some of their platinum and palladium the spot Zurich market because of slack demand in the domestic market."

It would seem that hitching one's horse to "industrial demand usage" is an unfortunate choice at a time when the blossom of rapid new growth has come off the global economy.

The gold price remains nearly even with levels seen at the start of this year, and gold remains uniquely poised to carry your wealth through the economic slowdown as the Fed stands ready to ease monetary policy even further in the days ahead.

Today, among others, is a good day to buy gold.


BelgianTrail Guide(s) and "Honni soit qui mal y pense".#591468/7/01; 12:18:00

Apologize, please, but I can't translate the French expression. Hope some Canadian can do it for me.

Isn't it extra-ordinarry that we have, here at our disposal, a theory with extensive and intelligent argumentation, about a subject that, as far as I know, hasn't been elaborated elsewhere, yet :

* The US-dollar and its reserve status *

A profound reflexion on the fundamentals of the past 30 years + a projection for the close future. I am surprised that nobody out there seems to be shocked by the idea that the globally owned and used, currency, is about to loose the major part of its status !? Again, no one seems to take this probability seriously and doen't even bother to come up with only one argument that should evidence the impossibility for such a dramatic change to happen.

Yes, indeed, we could say exactly the same about Gold. Who cares about Gold. Most observers / analysts are only floating on the surface and never take a dive into the deep blue.

The described above, is interesting to me for the following conclusion : all these fundamental changes must be organized at a very high level. Academic or pragmatic, don't know. But surely it is worked out by a very tiny minority of thinkers. That's why I'm stealthly adding that little "s" on TG(s).

The questions "if" and "when" should be relativated. The correct outcome of the projected is uncertain, even for the astute planners themselves. But than again...if this theoretical train wasn't already moving on its rails...there would be much more noice about the whole idea. Impossible adventures attract a much larger and louder public with shouting comments. This isn't clearly happening with an incognito who says that tomorrow the dollar will only buy 1/10 of today and that Gold will go to 30.000$/ounce !
Wouldn't this be "the" title of tomorrow's frontpage ?
And it hasn't happen. Strange isn't it ?

Not that I'm fixated on that number 30.000$/ounce...but has anyone seen, any goldbug using this figure in any posting ?
Yep and even today, I still have to insist to my closiest Gold-friends, that they should study and absorb TG !
Am I giving the answer, here, myself on the question ?

Sirs A. and FOA, I do admire and appreciate what you are doing here. And I want to express this with strong feelings of deep symphaty. Thank you very much and wishing you and your family all the best!

LeighGandalf#591478/7/01; 12:28:07

Gandalf, if you use that reasoning, just about all the posters on Kitco must have been educated at that same school.
Max RabbitzPanic in Argentina#591488/7/01; 12:34:33

Buenos Aires, Aug. 7 (Bloomberg) -- Argentines, who are withdrawing savings from banks at a rate of $220 million a day, are hoarding their money at home.

The biggest makers of home safes in Buenos Aires say sales have surged as bank withdrawals increase. Cajas de Seguridad Trella expects sales to double this month as customers buy everything from lock boxes to fireproof safes with digital combinations. Sales at rival Talleres Fenix have jumped 28 percent since April. Argentines unable to afford in-home safes, which sell for as much as $3,000, say they've buried cash in their backyard, hid it in ovens or stuffed it into laundry hampers.

Max: I understand the need for a certain amount of fiat but have they all had Lobotomies or am I missing something? The government can and will print 10 for every piece of paper they hoard. You don't need a fireproof safe for gold. And those stories of Japanese hoarding paper yen as their government talks about inflating. Perhaps those stories about Black Helicopters spraying funny chemicals are TRUE!!!

Hill Billy Mitchellsite steward @ # 59145#591498/7/01; 12:47:25

Sir Randy,

I am inclined to agree with you as to the negative affect upon the price of platinum and palladium being, at least in part, a result of the current world economic slow down. Also I agreed with your statement, "gold remains uniquely poised to carry your wealth through the economic slowdown".

However, I must take exception to your putting silver in the same category with platinum and palladium. True, silver has tremendous usage as an industrial commodity, else we would not have the incredible shortage that now exists, but there is a difference.

Silver is like gold in that it is considered to be money in the purest sense. I know that there is much disagreement as to the difference between money and currency and I am not trying to dig that issue up with this post; however I strongly feel that that issue was not brought to a valid conclusion.

Gold is not shining yet! Silver is not shining yet! Let us stick to the proven historical fact that both will always be money as opposed to any other commodity in existence. Gold is for the wealthy and silver is for Poor Old Solomon, and either or both are for most anyone at the current fire sale prices.

Yes, "gold remains uniquely poised to carry your wealth through", but this does not give cause to bash silver, which is uniquely poised to accomplish the job also.

Very respectfully,


BR549Savings vs. Hoarding#591508/7/01; 13:44:20

Savings and hoarding--aren't they really the same? Savings is generally thought of by classical economic theory as being healthy for the economy and hoarding is not. Healthy economies thrive on rapid non-inflationary economic flows. When economies contract, then available goods and services increase, supply outpaces demand, people become afraid of the future, then hoard rather than spend, and the economy slows down and sometimes even stops. If citizens hoard gold, then gold becomes wealth. If citizens hoard currencies, then deflation occurs, then recession, then depression.

The manipulations of the financial markets, shorting, derivatives, are indeed speculation. These manipulations are done at the expense of the citizens for the benefit of the banks. The government cannot get rid of its gold altogether but can lease it or confiscate it as needed to protect themselves from revolution for their past mistakes. Anybody who has seen the government up close and watched the lobbyists sell out U$ interests, who have seen the bureaucrats who couldn't get a job in the commercial marketplace sweeping the floor, etc. assure me that we cannot trust the government. The only way that any significant change will be made is out of the ashes of a full economic collapse.

The difference between savings and hoarding is just a matter of degree. In uncertain economic times save currencies to cover short term needs and hoard gold, food, water,......

NetkingHBM/Randy & Econolast#591518/7/01; 13:49:26

HBM(59149)& Randy - This China factor is unproven one chaps. I have seen so much creative accounting broadcast in annual reports & media releases by all & sundry that I am weary of believing whatever comes along when logic says otherwise.

As we have said here over the last year, where is it being exported to "IF" it is being exported.

Is it being sold at 5,000 inflation adjusted lows by the Chinese for a quick bargain on their part? A news link I posted the other morning indicated the PRC were expecting strong domestic demand for PM's. As a result Au imports were going to be up to the PRC & Ag exports (if there were any) were going to be stopped or down due to domestic demand creation with Olympics & other factors all playing a part.

Why would you dump only to have to buy back again in the near future at much higher prices? HBM, maybe the Mrs & your perfect daughter have been selling off your secret hideaway stash huh!<grin>
Sir Econoclast(59139)Yes this was a brave move & potentially a smart & logical one for them yes, lets hope the POG rises for them soooooon, there are sharks circling in the waters . . .

PH in LAPatriotism#5915208/07/01; 14:27:34

Nice performance, FOA! Nice posturing and flag waving! You're OK, since you are a patriot, after all. (tongue firmly in cheek)

Hill Billy: (taking tongue from cheek, now)
There are very many kinds of patriotism. Most of them are tools used to conscript cannon fodder for whatever stupid war the fat cats at the top are promoting at the time. I mean, why else would anyone throw their life and their personal integrity away at a moment when everything in life lies before them? And I say personal integrity because the very first lesson the conscript must learn is to obey whatever they are told, no matter what they might think. The end of that trail is the sorry spectacle that was staged at Nuremburg for the benefit of all the surviving "patriots".

Yet before any of us can be molded into the role of "patriot" he must first be a full member of the human race. (I mean, do you know any "patriotic" animals? I thought not.)

Now the human race contains many, many different kinds of people. Some have no problem discarding whatever reason they might have inherited as homo sapiens in the name of "patriotism". For others, it is not so easy. Nothing is accomplished by slinging mud at the latter just because they don't fall into the former catagory.

My reading of FOA's whole story is that he values his membership in the human race above all other memberships. His message is a pragmatic one. If the dollar needs adjustment, we should all be aware of it beforehand. As intelligent human beings, we owe it to ourselves.

FOA and ANOTHER take a very broad view. A view of the forest, instead of the trees. I mean, how often do you admit to yourself that the prosperity we Americans have taken for granted for generations is due to the outcome of the 20th century's many wars? Rather than to our natural work ethic and personal industriousness? Is it then unpatriotic to wonder if the rest of the world still owes "America the Conqueror" such a tithe of their production just for winning the war? Does this war debt ever end? Or is it your "patriotic right" to these benefits for all the rest of time? This is what thinkers like FOA and ANOTHER are talking about when they postulate the demise of the dollar and efforts by Europeans to get out from under the yoke of the dollar system. They are not the enemy you would like to make them by casting aspersions on their "patriotism". Do you remember Pogo? "We have met the enemy, and the enemy is us."

While we're on the subject, do you remember some of the policy goals of Jimmy Carter? Recognizing that the US had a problem with immigration from Central America threatening to overwhelm us, he wanted to make Central America a more prosperous place so that its people would have more incentive to stay there, rather than coming here. He wanted to normalize relations with Cuba, etc. Lots of stuff like that. But what was Reagan's solution to the same problems? Why! a war! That's right! Remember the "freedom fighters"? The Bolen Ammendment? Do you remember how congress had passed laws explicitly forbidding aid to "freedom fighters" in El Salvador? And how Reagan violated those laws in his zeal to promote war in Nicaragua? A completely stupid war that later had to be cancelled. Who won that one? I submit that nobody won it. Everybody just quit.

I'm pretty sure you think Ronald Reagan and Olliver North were "patriotic Americans". Yet, the kinds of solutions Americans like Jimmy Carter wanted to pursue would have improved life for Central Americans and us gringo North Americans alike. This would have been a solution for improving conditions for the human race, as opposed to a solution for the benefit of "patriotic America" first.

Sometimes patriotism is not good. Sometimes, we owe allegience to a higher power! Let's pardon FOA the effort of proclaiming his "patriotism"! His writings have been so selfless for so long. He shouldn't have to jump through your patriotic hoops, too!

Chris PowellHoni soit qui mal y pense#5915308/07/01; 14:39:51

Hi, Belgian....

Bartlett's Familiar Quotations says it means: "Evil to him who evil thinks." I've heard it translated as well as "Evil is he who thinks evil." Bartlett's attributes it to King Edward III of England and says it is the motto of the Order of the Garter.

escapethematrixDon't worry America.......Everything's just fine ....#5915408/07/01; 15:14:55


San Jose, California, Aug. 7 (Bloomberg) -- Cisco Systems Inc., the world's largest maker of computer-networking equipment, said fiscal fourth-quarter earnings plunged 99 percent as the company ended the fiscal year with a $1.01 billion loss.

But I'm sure that "things are just about to turn around...."

To PH in LA: Nice post, I agree completely.

slingshotBR549 Msg#59150#5915508/07/01; 15:21:58

Savings is what you accumulate for the security of your family and love ones.
Hoarding is the term/excuse the government uses to confiscate your savings and distribute it to the socialist state. Might I add that it will be the same people you tried to help by introducing them to gold, only to be looked upon in a negative light.
Full economic collapse= Full Hunker down.

By the way, How is Junior? HEEEEEE HAAAWWWWWW

Cavan ManPH in LA#5915608/07/01; 15:39:15

Nice post and; I completely agree with you (FWIW).
BR549Hoarding#5915708/07/01; 15:47:12

@ slingshot--

Thanks for the warm welcome on my first post here.

According to Mr. Webster---

Hoard, n.: A hidden fund or supply stored for future use; a cache. Verb: To gather or accumulate a hoard.

Different from ordinary savings in that it is "hidden".

Hoard, v.: To collect and lay up; to amass and deposit in secret; to store secretly, or for the sake of keeping and accumulating; as, to hoard grain.

Different from savings in that is is not "just for the sake of" keeping and accumulating.

Do you see the word government in there anywhere?

By the way Junior Samples is at that great cornpatch in the sky, but Lulu is still available for you.

site stewardEspecially for Hill Billy Mitchell for msg#59149#591588/7/01; 15:56:42

I, too, feel that "that issue was not brought to a valid conclusion." Or more accurately, I should say that my own postion on the matter was never fully stated because a small unruly faction of the assembly forced a premature suspension of my open presentation at the midpoint of the series. So whether I'm the one tapping away at the keyboard or a fellow in my stead, you won't see the ol' "site steward" broach that subject again here at the Forum. However, I would certainly encourage all others out there with civil demeaner to respectfully debate all sides of the gold/currency/money/wealth discussion. We certainly wouldn't want to sit back and let FOA have ALL of the fun as he traverses this material "over there" upon the Gold Trail.

With regard to my post that you cited, I apologize if my text appeared to "give cause to bash silver". I may have overstepped my posting guidelines when I used the various elements of the news article to provide my pro-gold conclusion.

I can see now that it would have been more business-minded for me to have said instead, "Buy silver, everybody! It is as cheap as its been in eight years!"

But no. Then I wouldn't be able to sleep with a clean conscience. To state no concluding remarks would have been a marginally better option for me to employ. Thanks for the feedback.

Bottom line: I encourage everyone to explore the callings of their personal Free Will. And with or without rhyme or reason, let us hope that it calls for yellow metal!


slingshotBR549 Msg#59157#591598/7/01; 16:10:43

Sorry to hear about Junior. Long time since I have seen LuLu.
Yep, Did not see the word government anywhere.
That's the way I like it in either definition.
Gold is Freedom that comes in small packages.

Hill Billy MitchellPH in LA @ # 59152#5916008/07/01; 16:26:06

Sir PH,

You are correct. I was "cannon fodder", at the age of 19. I knew nothing of the difference between a nation and its sovereign peoples, between a republic and a government. I take no pride in the Southeast Asian war. I did what I thought was right at the time. I do not have the luxury of doing it over. I am glad I do not have that option, for I do not know what I would do. I do know what I would not do. I would not go to Canada to hide. (not intended to be a stab at Canada)

I am now 54 years old. I love my republic and pledge my allegiance to it. I have no use for the government. Yes, there is more than one kind of patriotism. I hope that I am a patriot who would never compromise a principle to save my hide as the many of the German "patriots" appear to have done under Hitler. I was not in their shoes (I do not judge them)and can only hope to have learned from their mistakes, should I ever have to wear those shoes.

You are far to the left of me, or should I say, I am far to the right of you. There are at least three types of socialism: - National Socialism, International Socialism, and Fabian Socialism to name a few. I have no use for any form of socialism. I do hope that you would not consider me one of those types of "patriots".

History tells us that those who had gold and used it before it was too late, were able to find refuge.

Randy, this is for you. Gold did accomplish for some of the Jewish peoples in Nazi Germany what silver could not have accomplished. I still think that silver belongs in the mix for metals accumulation in the United States.

Very respectfully,


BR549Hoarding#5916108/07/01; 16:26:41

@ slingshot (msg#:59159)--

Got some? Heck, yeah, I'm hoarding all the gold I can get. I am also hoarding food, water, ammunition, ... I don't owe the banksters anything on my house or property, I got some silver.....

What's wrong with hoarding??

Regards from Cornfield County

Hill Billy Mitchellslingshot and BR549 #5916208/07/01; 16:35:17

I agree with both of you.



slingshotHill Billy Mitchell#5916308/07/01; 16:42:46

Welcome Home. Job Well Done. Thank You.

R Powellsite steward#5916408/07/01; 16:54:04

Just one man's opinion and it's airing does not necessitate any reply.
When you say, " won't see the ol' "site steward" broach that subject again here at the Forum.", I wonder why you have decided to muzzle your thoughts. If I am interpreting your implied message correctly, it seems that you have withdrawn from discussion. IMO, whatever the current subject, your absence from participation will be a loss. This also calls to mind one of my mom's old sayings, Stifling a sneeze is not safe or healthy.
As concerns your obligations as the site steward and your own personal opinions/thoughts, don't we all wear many hats during the course of each and every day? I function daily as a parent, husband and owner/operator of a one man masonry business before I become Rich on the USAGold forum.
Perhaps site steward can post what's approprate for him while Randy speaks with a separate/different handle??
Again, just a suggestion, FWIW

BelgianDollar-Silence in Europ#5916508/07/01; 17:00:34

Sir Powell, thanks for the translation.

Less than 150 days away from the euro-paper reality, I haven't encountered any kind of public $/€ insinuations.
The euro transition evolves with a strange and very cool (sober) educative propaganda. No macho talk about a "strong" euro, but rather stressing on a "stable" euro.
An atmosphere of caution reigns. The financial press is not at all comparing the coming euro to the dollar. No TG-talk over here. As if the EMU is walking on eggs.
Not one question about official dollar-reserves or on all this US$ denominated bonds, holded by so many euro-individuals ! And I can assure you that each and every household has a dollar bond under the matrasse. Don't know the total volume and impossible to overvieuw the impact when all thiese dollars will be exchanged for euros.
High probability that from 1/1/2002, most of these private dollars will bid for the euro. This is definitely not happening today. Any possible sign of financial nervousness or panic is avoided with that cool campaign.

Is this an element of EMU's management skills ? Is this a reason why POG must signal dollarstrength up until 1/1/2002 ? Is this the reason why I have to discover TG's guidance on a US forum ?

Why has Germany so suddenly and apparently for no special reason, sold, 12 tonnes/1 hour of Goldcoins to its citizens ?

European bondholders are all informed extensively that their bonds in lira/mark etc, are automatically changed into euros. But not a word on dollar + related currencies.

Today, the POG/POO tandem went into reverse of what happened in euroland. There must be an emergency plan to avoid a flight out of the euro from 1/1/2002 onwards.
Is this a reason why the euro runs to that date as kind of underdog and make a surprising sprint starting at 1/1/2002 ?
Is the 8 year POG-cycle (bottom to bottom)(2001/1993/1985...check it) a coincidence ? August, the weakest POG month of each year and POG holding relatively well (for the time being) !

What would be the effect on US dollarholders (capital flows),if from 1/1/2002 onwards, the euro should eventually show explicit strength against the dollar ?
The reason why so many individual europeans hold dollarbonds, was their doubt on the strength of their own currency and automatic admiration (trust) of the reserve currency. The more I think about it, the more I have that funny feeling that the next 365 days might hold some surprises. My previous euro-criticism does slowly gives room to some belief in subtle EMU-management.
After all, uniting 12 totally different countries/cultures, is already a titanic achievement. This was already prepared a long time ago. And that's where TG has been building on.

All US gold-writers do agree on the intrinsic dollar weakness...but never relate this to the euro ? Euro silence in the US.

slingshotBr549 Msg59161#5916608/07/01; 17:03:10

Nothing wrong with hoarding. Looks like we think the same. Funny thing about Goldbugs. They seem to collect the same things.
We are securing our freedom one Gold piece at a time. May the Powers That Be, allow us more time to accumulate longer and at a low cost, by thinking we are incapable of seeing their plan.

Hill Billy MitchellR Powell @ # 59164 and Randy#5916708/07/01; 17:10:42

My sentiments exactly. Bravo, and what a great suggestion by Rich. I particularly liked the TownCrier handle. And I really do think that a hole was missing in the money vs. currency arguments. I just have not been able to put my thoughts in a suitable form. Randy, you kinder and gentler thang, you. Please post and stimulate our thinking.

This is an area where TG has been exploring on the trail, but he is so cryptic that I cannot understand him sometimes. He communicates well but I have to work entirely to hard to discover what is saying at times. No offence meant towards him, so no need to defend him for his cryptic delivery or to attack me for my laziness and or thick headedness.

Very respectfully,


EconoclastSaving vs. Hoarding#5916808/07/01; 17:12:37

Are you a gold advocate/investor... or a goldbug

It's all in perception.

"Saving" is a politically correct activity when it is denominated in your local fiat currency. All the extra that you've produced over what you have consumed is reduced to a number "on account" that is totally at the whim and mercy of the controlling monetary authorities.

"Hoarding" is a politically incorrect activity. The sound of the word itself (which was re-popularized during Y2K) is given to negative connotations. It is a politically incorrect activity because usually, you hoard what your local fiat currency can buy. This is a severely frowned upon activity because, first, it encourages independence from the welfare state, and secondly, it does the double duty of foiling the controlled burn in the value of your currency (inflation).

During Y2K, laws were passed in some states prohibiting "hoarding". How it can be against the law, or even frowned upon, to purchase lawfully sold goods and commodities with lawfully earned "money" is beyond me.

But then again, we live in an Orwellian world.

site stewardRich, my good man, thanks for the thoughts#5916908/07/01; 17:39:34

I'm really overstepping proper usage limits of this "site steward" code to respond, but wanted to simply direct you to an explanatory post (offered July 29th) which you may have missed. You will find it easily enough (Randy@TheTower located at the top of the page) if you click the URL given above. Please have a look. And thanks, again, for your comments.


Orville GoldenbacherTorn on patriotism?#5917008/07/01; 17:40:22

I love my country, but distrust my government.

All the more reason to own gold!


BR549Hoarding#5917108/07/01; 17:41:10

@ Econoclast(59168) , slingshot(59166), & HBM(59162) ---


The negative connotation of "hoarding" is from the elite "equities" types that value being "politically correct" over "what is right". I wish I had said that.

My point about "hoarding" is that it should NOT be a "negative" term. It should be what "little red hens" do when they know what is coming down the pike. Being prepared for a hurricane that does not materialize is not "dumb", it is smart. Y2K had to do with computer failures that the public will never know about but individual preparedness has to do with self preservation (hoarding).

Thanks for the warm welcome. I feel more comfortable now and will lurk a while longer..

Regards from Cornfield County

slingshotEconoclast Msg# 59168#5917208/07/01; 18:02:44

I am a gold advocate/investor/goldbug.
Ah! Yes, Perception. Does it apply to everything.

Goldbug#1 I'm saving these here twenty cans of TUNAFISH for an emergency.

Goldbug#2 I'm saving these here Three hundred cans of TUNAFISH for an emergency.

Goldbug #1 Eats a can a month.

Goldbug #2 Eats a can everyday.

Who is saving for an emergency and who is hoarding?

If the government determines by perception, hope you get an agent who likes Tunafish to side with your love of tuna.

What does this have to do with gold? If they can confiscate Tunafish, They will not think twice about gold.


site stewardBecause life has cycles and the future is unknowable, "hoarding" = civil duty#5917308/07/01; 18:24:12

If we are fortunate, we fill our bellies with breakfast so that we may have a store of energy to meet our life's obligations until dinnertime.

If we are fortunate, at Autumn's harvest we gather the fruits and grains of our Summer's labor so that we shall not perish from wanting sustenance throughout the long, bleak Winter.

If we are practical and wise, and if fortune smiles upon us with a Good Year, in imitation of the seasonal cycle we set aside our abundant wealth so that we may be provisioned against the Lean Years that lurk unpredicably in our futures.

We do this so that we need not go begging -- a burden and taxation upon our good friends and neighbors who, if they are honorable, have themselves toiled and harvested in Good Times with an eye toward a more comfortable, stable future in an up-and-down world of cycles and uncertainties.

Perhaps this pushes the limits of "news" and "facts" versus my "philosophies". I must endeavor to tread this ground lightly!


LeighPH in LA#5917408/07/01; 18:31:43

PH, the term "American patriot" usually means a person who believes in individual liberty, freedom of speech, freedom of the press, the right to defend oneself, and the obligation to cast off tyranny. It doesn't mean bowing down to the often ridiculous demands of government rulers.

The term "American" is used because those were the ideals of the American Founding Fathers. Those men (and women) were seekers of freedom, and their collective efforts made them "patriots" of a free country. Sadly, what remains of that now is only a shabby jingoism, and true patriots no longer feel themselves bound to a nation but to an ideal.

slingshotSite Steward Msg# 59173#5917508/07/01; 18:38:42

If I may borrow the words from Charlie Brown in PEANUTS.


NetkingSite Steward/Randy#5917608/07/01; 18:46:22

Re: Hill Billy Mitchell(59167)R Powell(59164)

Randy, motioned seconded, keep your viewpoint here Sir . . . even if it's with a different hat to clarify the channel? -Netking

site stewardTo slingshot, re: "THAT'S IT!!"#5917708/07/01; 18:49:18

I now say to you, as Lucy would say to C.B. from behind her little wooden stand:

"Five cents, please."



auspecNetking#5917808/07/01; 18:52:42

Thank you for your post # 59123 and for relaying these silver questions to Ted Butler. He IS most gracious and I have asked him silver questions in the past and received worthy commentary. From his reply to your questioning: The silver short position is greater than annual silver production AND 'known' above ground supply, pretty precarious. The gold shorts are, of course, also much greater than annual gold production {probably a higher ratio than silver if they are 10 to 15,000 tonnes compared to annual production of 2,500 tonnes}, but nowhere near the above ground known gold supply.
My past questions to Ted {the man} Butler were in regards to possible 'unknown' amounts of silver that may become available to the market, or Black Silver if you will. Both he and David Morgan are constantly qualifying their statements in regards to supply that is officially accounted for. They acknowledge there may be quantities of silver that are yet unaccounted for, but are forced to ignore it for the very same reason that it is unknown. Of course what else can they do? This silver 'wall' was supposed to have been hit years ago, yet the game continues. If we go more than the next 2 to 3 years w/o long overdue market 'adjustments' we can start looking for unofficial sources of silver. IMF {I know what the MF stands for but unsure about the I} have silver too?
$2 Silver? Hard to believe for sure. Maybe Martin Weiss' gold and silver guru {what's his name?} knows about vast quantities of silver that are off the records, certainly not impossible, but also not impossible this is nothing but more scare tactics in use by this outfit. They have been known to call a few collapses incorrectly or at least YEARS prematurely. So sue me if I'm wrong. These are the same yo-yo's that rocked the cradle in prediction of sub $200 POG a year or two ago. Ho-hum.
If we get to $2 Silver we just may have to restock a bit, no? Not much silver will be produced at $2 {or $4 for that matter}. Consumption might uh....uh....skyrocket?
Isn't it quite odd that all we gold followers are getting quite accustomed {conditioned} to sub $300 Gold? It's been nearly 2 years since the spike to $330+.
Will leave you with a few thoughts:
The Constitution-- A brilliant document in need of a country.
The Justice system-- No better than a plea bargain with Teddy Kennedy.
New World Order-- Inevitable but doomed to a spectacular failure.
The free Markets-- RULE!!!

Kind regards,

auspecCan't Keep {Get} A Good Man Down---Midas#5917908/07/01; 18:59:56

"Yesterday, I received my third confirmation of extensive Middle East interest in securing long term physical gold supply. I have first hand knowledge that this is the case. What is also becoming more clear is that the bullion banks are hankering down their own long term supply. They know what is going on and they know that it could end at any time, especially with GATA forces gaining ground by the week."

"The increasing competition for supply commitments of a year or more are coming harder and harder to come by, which is why the Middle East buyers are going outside of normal supply channels. Instead of securing supply from the Swiss bullion banks, they are competing against them." END

Seems like someone around here keeps talking about an unencumbered gold grab. Regards to you, friend!

Tree in the ForestLeigh, HBM#5918008/07/01; 19:04:46

Leigh: How true!

HBM: Thank you for your service and your patriotism, sir. The wisdom of age has led you to a rational patriotism and it suits you well.

CoBra(too)... Beating about the same - Topic ... myopic, indeed?#5918108/07/01; 19:09:49

I seem to be reading too much of Bill Bonner's Daily Reckoning - though he's on holidays - still his friends keep a close watch on markets.
The doomsday, Tuesday was averted - as I've said and so has Bill B. - thanks to his information about the bureau of much Belabored Labor Statistics(TM *May 2000)- though today will be all eyes on Cisco "The Kid". ...
Beating the W.St. estimates for 14 qu's in a row - by a penny - analysts are estimating .o2 cents a share for the quCisco's 4th-Qtr Net Plunges 99% as Revenue Drops 25% the result is : quote "(update4)
By Scott Lanman
San Jose, California, Aug. 7 (Bloomberg) -- Cisco Systems Inc., the largest maker of computer-networking equipment, said fiscal fourth-quarter earnings plunged 99 percent on lower demand and the company ended the fiscal year with a $1.01 billion loss.

Sales this quarter will be unchanged to down 5 percent from the previous period, Chief Executive John Chambers said on a conference call. Net income in the fourth quarter dropped to $7 million, or break-even per share, from $796 million, or 11 cents, a year earlier, Cisco said. Revenue in the period ended July 28 fell 25 percent to $4.3 billion from $5.72 billion.

Cisco declined to give a forecast beyond the fiscal first quarter. Chambers said the company's ``long-term visibility is still challenging.'' Chambers has cut 8,500 jobs this year and trimmed product lines to cope with a U.S. economic slump and decreasing orders from phone and Internet companies.

``No one really knows when the economic and capital spending .... well, thanks we've had it!
- though they've been off 99%, according to Bloomberg ... the earnings of pennies even are now mere memories of the new era paradigms of the productivity miracle, it seems.

And as Dan Denning says so astute:
'Perhaps what's lacking, though, is a proper perspective. It's not that Wall Street's vision that's poor. It's the Street's understanding of the impact of technology on profit. If only Wall Street knew the story of the chickens with red contact lenses, their foresight might be nearly as good as their hindsight'.

Pop, goes the weasel! ... and the more you try the popping will even pop your eye!...see productivity, says I and find your place in financial security in this waste of analytic perjury.

All told - got gold? cb2

Hill Billy MitchellR Powell @ # 59164#5918208/07/01; 19:24:22

Sir Rich:

Many moons ago I understood you indicate that you specialized in concrete flatwork. I have on several occasions alluded to my great admiration for you as a man who knows how to perform heavy physical labor and provide for his family. My admiration is not diminished by your clarification that you are an "owner/operator of a one man masonry business ".

Do you do both types of work? Boy I'll bet you have either built or plan to build quite a hiding place for your stash.(grin) Silver takes up so much storage space, but that would not be such a problem for a person with your talents.

I have to go out and hire a person like you to get the job done. I am dysfunctional in these areas. When I was, sixteen I was gently discharged from my tractor-driving job by my girlfriend's father. After backing up with the disk in the ground for the third time and bending the crank all three times I was told, "Bill, you are just not mechanically inclined." Lost my job that very day and my girlfriend a while later.

By the way it is the only job from which I was discharged. Now I am like you in that I can't find any one to fire me because I am self-employed.

It is helpful to all of us that we are not alone in that we gold bugs around ordinary people like ourselves. Ordinary is probably a strange choice of words to use in complimenting another person but I stand with it. One can be both exceptional and ordinary. You are proof of that.

Very respectfully,


Tree in the ForestI am worried about silver#5918308/07/01; 19:26:45

Ever since Trail Guide's post about 50 cent silver, I have been questioning silver. I mocked his belief but it continued to eat at me. Now silver is making new lows and Edelson/Weiss have stated a similar opinion. I am no fan of the Safe Money Report. They have been terribly wrong in the past, but even a stopped clock is right twice a day. If silver moves up sharply when gold finally makes it's entrance, well and good. But if the weakness we're seeing now continues, it won't look good for silver. I don't care how useful it is, how big the overhang is, how they're using paper or "black silver" to drive it into the ground or how many reasons there are why it should explode, if it shows weakness at a time when it should show strength, it's time to question what you are doing. I do believe that silver must explode eventually but this might not be the time.

Some words of wisdom from the trader's almanac:

1) Never get emotionally attached to a position.
2) Never let a small loss become a big loss.
3) Always have a stop to prevent big losses.

Don't make the mistake of riding a loser into the ground like people who bought gold at $850. Or people who let a 5 million dollar position in Cisco fall to 1 million. Etc. etc. Have a silver stop in mind. If it falls below your loss tolerance, get out and concentrate on gold. You can buy back your silver at lower prices later on.

All of the above just IMHO. Make your own decisions.

Gandalf the WhiteQuestion to Site Steward, aka Palantir, R @ The Tower, Town Crier, et. al.#5918408/07/01; 19:28:56

site steward (8/7/01; 15:56:42MT - msg#: 59158)
"I, too, feel that "that issue was not brought to a valid conclusion." Or more accurately, I should say that my own postion on the matter was never fully stated because a small unruly faction of the assembly forced a premature suspension of my open presentation at the midpoint of the series."
*********Pardon me! Does that mean that you are again selected to EDUCATE all of us ? OR only the "small unruly faction" ?

Cavan ManHey, Randy....#5918508/07/01; 19:36:50

RE: site steward

Give it a break wouldya? Towne Crier: Who loves 'ya baby?
slingshotGreenspan, Euro, Gold, War.#5918608/07/01; 19:39:27

First I have to give credit to ABUDAHHAD's post 59111 that jump started my CP.
There is the rumor that Greenspan is going to retire sometime during the first half of next year. Should he go early, this would fit into my time line. For Greenspan to retire before 2002 would save him for the embarrasment should the market faulter. Meanwhile the Power Elite do everything they can to keep it together. When he retires they put some unknown in his spot for the fall guy. Exspounded to be the man for the job but makes an honest mistake. At the same time the EURO comes on line backed by gold come into competition with the Russian Chevonot. Forcing all those US Dollars out of Russian hideaways on to the market and back to the USA.With the price of gold steady and all those dollars would be a spring board for the price of gold. The only other player is ISRAEL. Does it not plan to go to war in 2002.
Well it looks like we will have some time to accumulate at low prices.
The gold mines have time to unhedge. the banks have time to retreive their sold gold.

Just put it all together.
Pretty raw info.

Leighslingshot - Gold Availability#5918708/07/01; 19:47:01

Watch out for those big Middle Eastern buyers! Midas was saying tonight they're scooping up all they can get their hands on. One day we may wake up and find it's all gone.
NetkingSlingshot#5918808/07/01; 19:55:10

Re: Does it not plan to go to war in 2002?

Netking: IMO it depends whether or not "big brother & sidekick" neutralises the growing Iraqi threat before then for them? There's too much at stake(ie black gold for one) for inactivity. . . "watch this space" yes.

Black BladeHedge funds are moving on Argentina#5918908/07/01; 20:00:27,,5-2001271443,00.html


HSBC, the banking group, claimed yesterday that hedge funds were building up speculative positions in Argentina's financial markets, which could trigger a collapse among other emerging economies. Keith Whitson, HSBC's group chief executive, said: "If the rumours are to be believed, there are those building up big speculative positions. It is not at all helpful."

In 1997 global hedge funds, including those run by George Soros, helped to drive down the value of currencies in Thailand, Malaysia and Indonesia, leading to a prolonged economic recession across the region. Hedge funds were also partly to blame for driving the UK out of the exchange-rate mechanism nearly a decade ago, after they pushed down the value of the pound.

Black Blade: Would be interesting to know if George Soros is in on this. This could be big news.

Hill Billy MitchellTree in the Forest @# 59183#5919008/07/01; 20:05:17

Sir Tree

No need to worry about silver.

I think TG was talking about silver knuckles. See above link for silver knuckles for 50 cents.



slingshotLeigh, Netking#5919108/07/01; 20:12:00

Leigh, Yes get it while you can.

Netking. The USA does not have the stomach to get into a
escalated war in that region. They may hold Iraqi with the air patrols but IRAQI has smuggled armed commandos into the surrounding countries. Effectively beating the USA to the punch. Israel has opened recruitment stations around the world to bring back enlistees for military service. Time for training and to arm. The war will be a short one but enough to put the dollar euro and chevonot in their proper order. Not to mention Gold.
Too old for Hand to Hand. This Financial War is mor to my liken.

Black BladeOil Sands: Tapping Alberta's Energy Gold Mine#5919208/07/01; 20:35:50


HOUSTON--(BUSINESS WIRE)--Aug. 7, 2001-- Not since the days of Spindletop has there been such a buzz in the oil industry. However, the buzz heard today is not the sound of oil well gushers spewing black gold into the air, but it is the sound of giant mine shovels and haul trucks digging up the riches of Alberta's oil sands deposits. With an estimated resource of 1.7 trillion barrels of Bitumen, Alberta is sitting on an energy gold mine. is tracking $25 Billion in planned oil sands projects, which include construction of large open pit mines, in-situ (in the ground) oil well fields, upgraders/refineries (HPI), and related infrastructure projects (distribution pipelines, terminals and power plants).

Black Blade: Non-conventional oil coming into its own due to higher prices. However, only a fraction is economic at current prices.

slingshot(No Subject)#5919308/07/01; 20:43:02

Afew more comments on my last post.

The USA I believe does not have the backing of the Arab World this time.Don't forget world opinion against Israel.
Israel may go it alone.
The Arab States have the oil and now going for the gold.
The Palestinians are the foot hold needed to destroy Israel. They have stated it in their charter. We don't need a big war, just a small one to get Gold moving.

Black BladeEmployment Worse Than Thought?#5919408/07/01; 21:05:51


Employment statistics are computed from a survey administered by the Bureau of Labor Statistics. State employment bureaus use their state's sample to estimate monthly state employment figures, while the national BLS office uses the entire sample to formulate nationwide numbers. Because states prepare their own estimates individually and without forced reconciliation by the BLS, the numbers very rarely match, though in theory they should. But the current gap between estimates of national employment and aggregated estimates of state-by-state employment has reached an uncharacteristically large 1 million.

Black Blade: The report is quite revealing. However, no one addresses the fact that many have simply given up looking for employment or have slipped into the "underground economy."

megatronLeigh#5919508/07/01; 21:44:39

Yes, you are correct, america has now become a vacuous 'concept' that most people have a very hard time understanding. It has been bred out of them. When I explain private property rights to my friends and why Canada never had them, their eyes get glazed over and look confused. It's sad. My girl's dad always says about Russia, "They're workin out of it and we're workin into it"
axUS PRODUCTIVITY - NOT SO PRODUCTIVE#5919608/07/01; 22:31:38


Figures released today indicate US Productivity gained + 2.5 % for the 2nd Q

U.S. Productivity = Output - hours worked.

Output rose +.1 %
Hours worked declined -2.4 %

The rise in output was minimal, and the overall productivity figure received its
big boost from the fact that many workers have recently lost their jobs.

It would seem that the economy is still in need of substantial improvement and
such measures that would effect this improvement.


NetkingSlingshot - M/East#591978/7/01; 23:03:20

That is correct Sir Slingshot, USA (& UK) invlovement would be by air strikes to neutralise the Iraq strike capability against Israel, which it openly infers it wants to see removed from the map books (along with it's people). A prolonged ground campaign with losses is an American Presidents re-election bogy and would not be a "pre-planned" option by any in their right mind.

The new northern Iraq air control centre & base (with Chinese & Russian fibre optic technology )is causing allied concern & fueling a strong desire to have it removed. Israels immediate area of conflict, Palestine, appears to be wearing down somewhat faster (so far). Israel is playing "hard ball", given the provocation this may have been their only option for survival?

The 800 Iraqi commandos sent was not a blinding success, with many pinned down in the desert or captured (check out post #59012 for much more on this).

President Saddam Hussein will deliver a national address Wednesday amid rising tension with the United States and speculation that he is laying the groundwork for his successor, read this link for more:

Reports carried in the Arab press said a large British and U.S. strike was imminent. U.S. officials said they were reviewing their options. Senior Iraqi officials stayed in their offices until the early hours of Tuesday on alert in case of an attack.

Meanwhile Arafat in Jordan say's: Israel has begun implementing the 'Oranim' plan, read more here:

This whole region is a problem which will not go away quickly & will feature much in the news in the days ahead, whether people like it, or not. - regards Murray

Black BladeRE: megatron - Russia#591988/7/01; 23:09:30

Funny you should say that about the US and Russia. I have said that Russia is sailing toward freedom while the US sails away from it and we pass like two ships in the night trading places.
megatronGold travels#591998/7/01; 23:21:18

Just got back from a week in northern central BC travelling the area around the old Pioneer/Bralorne gold mine areas. They pulled a couple of million ounces out since 1900,and still have a couple more in reserves or resource status. A fantastic 3 hour drive through glacier valleys north of Whistler will get you there. 4x4 only, I strongly urge! Beautiful ice green lakes and lots of fish too. So many abandoned buildings and machinery. Lots of old shafts fallen in. If you are in BC check it out. It's a fantastic experience for a 'goldbug'.
Spartacus@Belgian#592008/8/01; 00:10:11

So where are we now? I´m not sure. How long will the love affair between Greenspan and the bondmarket last? I don´t know. But one thing is for sure, when it ends(if it ends!), it´s game over.
Bascom ToadvineGreetings from NZ down under#592018/8/01; 00:26:11

On my way home from a month of touring Aussie and Kiwi habitats and yes they still carry gold on their shop shelves.

They now have slightly less... :-)

skiNetking or other Silver posters#5920208/08/01; 01:48:22

I have been following the silver story since about 1983. One question comes to my mind that no one ever seems to address. WITH THE SILVER DEFICIT BEING WHAT IT IS, WHY DOESN'T THE SIZE OF THE COMEX SILVER STOCKPILE EVER DECREASE??

If the silver deficit is for real, it would seem to me that we should be seeing a steady erosion of this stockpile.

Also, if world supplies of silver are as thin as known inventories indicate, shouldn't we be seeing instances of various silver products being unavailable at coin shops and the like?

It would be most interesting to find out that coin shops in various parts of the country are suddenly finding it impossible to secure a supply of silver dollars,bags of junk silver, or silver rounds.

As a final footnote, it seems to me that this is exactly the kind of information that the INTERNET and this wonderful WEBSITE is most suited to handle.

NetkingSki / Bascom Toadvine#5920308/08/01; 03:11:35

Ski(59202), Hello to you, I wonder if you're the same Ski from "Bart's Castle"?(if so I like your posts). All good questions that defey logic to anybody that thinks about it. Maybe the Comex stash is the last one around of any note, maybe that will be the final indicator Ski?

PM leasing has been suspected to have contributed much of the deficit of gold(refer GATA)and ditto for silver as well. A case of how to multiply the loaves & fishes to feed five million, and all without working any miracles this time!

Obviously, some silver is coming from sources we can't identify, from leasing. Whether it is from The Central Banks of the Phillipenes, or the PRC, is immaterial. This is source is highly uneconomic and unsustainable. But take a look for substantiation on the China flows, and you won't see an iota.

These China stories for example are made up by GFMS, and I challenge them to verify their statements. It's always, they know privately, but can't back it up publicly. It's pure rubbish, just like their inventory figures. To think the Silver Association publishes GFMS's work as fact, is a disgrace. If they can't back up what they claim to be is true, just assume what they're saying is garbage, and you'll be safe.
Bascom Toadvine(59201)
Where are you posting from?

Canuck@ Netking#592048/8/01; 04:15:21

Silver has not been used in coin for some 30 years. Surely this has a huge impact on silver inventories?

Let us assume, say in 1960 there was X billion ounces of silver for the use of minting and with the decision to stop using silver does it not seem plausible that inventories would drop dramatically?

I am blown away by the complete and total opposites in opinion regarding silver. What is(are) the reason(s) for this?



RockgrabberSKI: Local Coin Shops are hurting for SILVER (at least mine)#5920508/08/01; 08:13:28

I have aways had a choice of buying 100 ounce silver bars or 10 ounce ones, or the bags of pre 64 silver coins. Now only sometimes the bags of pre 64 stuff he has. He is charging and paying a premium for the 10 ounce bars, and the 100 ounce ones just dont come around anymore he has told me. I did ask how many people come in and buy silver, guess what. I have been the first in years to take his 100 ounce silver bars (besides himself). He sells them to dealers normally. But now there are none to sell. $4.15, incredible. When golds paper market fails and the price heads to 180, sure the price may be 180, but where are you going to find it? Silver may keep going down, but are we even going to beable to find it if it does? There will only be a few folks who even know that the price says one thing, but you cant buy the silver for the price as it is just to hard to find?? Soon?
USAGOLDToday's Commentary & Review: Grinding to an End of Summer Doldrums#5920608/08/01; 08:35:13


In Brief: Gold traded sideways overseas as the market ground its
way through the beginnings of the last leg of the summer doldrums
season. The news from India reported from Bridge News might be the
first sign that we are coming out of the traditionally slow time of the
year. It looks like the market wants to test $267 on the downside. We
have seen no signs of short covering as yet. As a matter of fact Comex
volumes, an indicator, continue to ratchet down as interest in the gold
futures' market continues to deteriorate. Too many years of being
dragged through the Comex grinder has left a bad taste with most
investors. Many have migrated out of the moribund futures market and
into the safer confines of the physical metal. Physical acquisitions by
safe haven investors is running at a steady pace despite the lack of
price action with the Mid-East and Asia taking the lead. Most of the
gold buyers we've talked to -- both within the U.S. and abroad -- cite
stock market concerns, the massive U.S. public and consumer debt
and general financial uncertainty as reasons for hedging their
portfolios with gold. Not surprisingly, both gold and and the Dow are
where we left them over a week ago when I started on News &
Views. The Dow is exactly where it was on July 30 -- the last time I
did an update. The summer doldrums do not affect just gold. They
affect all investment markets.

Note: I have completed the expanded version of News & Views
and it is now in editing. We've decided to go with a quarterly version
of the newsletter to supplement the USAGOLD web site. Most of our
clients are now "on-line" where information can be had at the touch of
a link. We decided that News & Views had to be upgraded to reflect
the change in public information gathering habits. In a way, the
change marks the passing of an era. I can remember when News &
Views was one of the only means for the average gold investor to
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Things have changed rapidly over the past five years and thankfully
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Buena FeThe obvious must read#5920708/08/01; 08:45:51

This one's a hoot, O'l Dudley of GS is putting on his parachute, as the plane has reached safe jump altitude.

No more strong dollar

US policymakers risk losing credibility if they continue to talk up the currency, believes William Dudley - Aug 08 2001 00:00:00

The time has come to scrap the strong dollar policy. It made sense when the US economy was booming, because a strong currency helped to suppress inflationary pressures. But in a downturn this approach has outlived its usefulness. It undermines the effectiveness of lower interest rates in stimulating growth by undercutting the competitiveness of US exports.

A strong dollar policy also no longer makes sense because it is unlikely to prove sustainable. The US has a large current account deficit, which has grown sharply in recent years. This imbalance creates a risk. If foreign investors' appetite for dollar-denominated assets were to diminish, the result could be a sharp plunge in the value of the dollar - and subsequent potential havoc in the US bond and equity markets...................

............Alternatively, assume that jawboning has succeeded in pushing the dollar up. If so, there is some fluff in the dollar's high present valuation. This implies that the strong dollar policy should be scrapped now to minimise the size of the downward adjustment that must sooner or later occur.

I believe this second view is the more persuasive. There are good reasons to suppose that Treasury comments have artificially supported the dollar's valuation somewhat.

First, the behaviour of both foreign exchange traders and the Bill Clinton and George W. Bush administrations suggests that rhetoric does matter. How else does one explain the close attention paid to whether the Bush team will depart from the strong dollar mantra espoused by Robert Rubin and Larry Summers, Treasury secretaries under Mr Clinton?

Second, the fact that the dollar is well above Goldman Sachs' estimates of its fundamental value versus most major currencies also suggests that rhetoric may matter. The strong dollar rhetoric may support the currency by affecting the risk premium demanded by foreign investors to hold dollar-denominated assets.

But while the strong dollar rhetoric may have worked to date, continued adherence to it is becoming risky. The fundamentals of the chronic large current account deficit point to a change in the exchange rate over the medium to long term. If the mantra is still in place when this happens, the loss of credibility could exacerbate the dollar's decline......................

Tommy PLayoffs#5920808/08/01; 09:03:17

Cavan ManBuena Fe#5920908/08/01; 09:03:46

.......or, GS goes short US equities.
Old YellerBush/O'Neill; playing the same old song #5921008/08/01; 09:19:11

Notice that Turkey,a far more serious debacle in my opinion gets a mere two sentence mention.This article seems to imply that the new team,after making lots of noise to the contrary,realizes that maintaining perceptions of stability is paramount.Our little yellow friend may be confined to the corral for a while.

USAGOLD,thanks for the commentary.Is there anything new in the Indian rupee situation,this currency was looking a tad vulnerable?

Thanks to cjk for the link.

BR549Strong dollar#5921108/08/01; 09:24:12

Buena Fe

Just look who is for a strong dollar:

Past Treasury Secretary
U.S. consumers
Foreign sellers

Farmers and me are for weak $.

Regards from Cornfield County.

Sierra MadreSilver in Europe, FWIW#592128/8/01; 10:17:47

A private bank in Switzerland was instructed to obtain physical silver for a client, a couple of months ago.

It took the bank WEEKS to gather physical silver in an amount of one or two tons.

The price was some 5% above spot.

The client was satisfied to have the silver at that price.

The above might be of interest.


BR549Newest Beige Book#5921308/08/01; 12:11:32

Retail sales, manufacturing, shipping, transportation, bankster profits, dollar, gold …. EVERYTHING DOWN
skiNotes on ......... "WHEN TO BUY"#592148/8/01; 12:55:28

I visit this site on a daily basis but only post if I think that I have something unique or useful to say. Thus, I thought that my personal notes on "WHEN TO BUY" might be useful to others.

1. BUY .... when you can't find a bull, when the investment is commonly thought of as foolish, stupid, ignorant or forgotten, when everyone is pessimistic and trying to sell, on bad news, at market bottoms, when the market is quiet, when trading volume is low, when prices are stable or cheap, when the item is still easy to find, buy before people and dollars start chasing it, when EVERYONE else is negative (possibly when even the normally astute contrarians, professional speculators and tired, old, diehard bulls have temporarily abandoned their correct, independent thinking and thrown in the towel), when nobody else is or on weakness, not on strength, when there has been an extended period of selling, when buying DECISIONS are thought of as difficult, daring, or speculative by SOPHISTICATED investors, when novice investors don't have a clue and are very, very far behind the information curve, when trading volume is low, when you can't find a bull (or a real person who is actually ACTING like a bull).

2. Anytime you can buy a commodity that is in demand for less than it's cost of production, in the long haul it will pay off.

3. In the short run, markets move on the public perception of the facts (not reality). In the long run, markets move on the reality or actual fundamentals.

4. When a market closes above or below a key target for three days in a row, assume the trend is in place.

5. The idea is to be in a given investment only when the odds of its going up appear to be 90 percent or better. And to be short when the odds if its going down are equally strong.

6. When a bottom is at hand, a feature article with strong emphasis results in only sporadic buying or otherwise has almost no positive impact on the market. Nobody cares.

7. At bottoms, the most common or typical investor is the very sophisticated investor. At tops, the most naive. Tops are when Joe Schmo has finally caught on.

8. It is rarely wise to "chase" any market when prices are charging ahead or even right after they have had a significant run up. (The converse is also true for falling markets).

9. Knowing "WHAT TO BUY" (or sell when shorting) is only one third of the problem. Knowing "WHEN TO BUY" and "WHEN TO SELL" are the other nearly equally important considerations. Human nature tends to pay the closest attention to "what" and not enough to both "when's".

10. Jim Blanchard quote ...."The smartest investors buy when an investment is cheap. It sounds silly to point out such an obvious investment truth. But history shows that only a very elite (and small) group of investors has ever been able to apply this simple wisdom to the market."


Netking, This is the only site I post on....Ski

MarkeTalkStock Market and U.S. Dollar High?#5921508/08/01; 13:48:14

With today's market action (DJIA down about 170 points and falling fast and the U.S.Dollar slipping again), it appears that the Bradley Indicator may have scored a direct hit on August 7th. As posted earlier, this indicator had predicted months in advance that a top in the U.S. stock market would occur on August 6-7th and then it would be downhill until early December. Falling stocks tend to correlate with a falling U.S. Dollar and that is certainly the picture today. It was nice to see the counterbalance--gold--rise in response. We will need to see some follow through into next week when the dreaded August 19th (new moon) arrives, and whether the Russian prediction of the collapse of the U.S. Dollar comes to pass.

Once again, I am sounding the alarm to all of my clients here at Centennial to batton down the hatches and to shore up their gold portfolios at these amazingly and ridiculously cheap prices. By Christmas, I believe that gold will be on everyone's lips, as gold slices through $300/oz. on its way much, much higher.

NetkingCanuck#5921608/08/01; 14:03:24

Canuck(59204)Silver has not been used in coin for some 30 years. Surely this has a huge impact on silver inventories?

Let us assume, say in 1960 there was X billion ounces of silver for the use of minting and with the decision to stop using silver does it not seem plausible that inventories would drop dramatically?

I am blown away by the complete and total opposites in opinion regarding silver. What is(are) the reason(s) for this?
Netking - Silver coinage in Mexico may "save their bacon"(USSR & PRC & others to come have shown interest on a smaller(?) scale). I guess much has been melted down & used.

The divergent opinions do not surprise me Canuck, there is so much "disinformation" in the market place, the stakes are big yes.

At the end of the day, "Wisdom is justified by her children". What will matter will be the runs on the board(price) that matters. Sure I hold some paper (for the short term) but I'm a physical long-term holder & am relaxed at any short-term washouts & will accumulate more.

I've looked into the fundamentals as much as I can & have relied on my own judgement & backed myself.

The days ahead will be interesting Sir! - regards Murray

Canuck@ Netking#592178/8/01; 16:35:37

Thanks for the notes sir.

Yes the 'disinformation' is abundant, to the point where it seems only two camps exist; the silver 'to the moon' camp and the 'silver-is dead' camp. There seems to be no middle ground.

The fact that silver coinage stopped in 1967/68? seems to explain to me, at least to a degree, why inventories have plummeted. Now ask 50 people in 'the know' about silver use in photography and you get 25 'camp 1' answers and 25 'camp 2' two answers.

I am getting a little worried. I accumulated a modest stash of gold pre-Y2K and since a modest stash of silver since. I think I am more comfortable with the gold at this moment. Silver does seem more 'commodity' based, yes?

I am getting a little worried about my overall exposure to both. At first guess I am probably close to 50% exposed in terms of total net worth in gold and silver. 'Missed opportunities grow very large.



P.S.: Of course, advice will be construed as of the 'non-investment' nature.

P.P.S. Sierra's post a few below blow me away. I am not saying it is 'disinformation', far from it. How is this information to be interpreted?

R PowellSKi / Silver#592188/8/01; 17:18:38

Ski asked earlier (59202) "...with the silver deficit being what it is, why doesn't the size of the Comex silver stockpile decrease?"
Good question.
It may be that industrial and photographic users buy directly from the suppliers without going through any exchanges. These two uses account for the vast amount of silver useage. Coins and jewelry use combined appears to be less than 20% of total use depending upon whose figures we look at.
An Analyst named David Morgan stated (this past Spring) that as of the end of 1999, there were 331 million ounces of silver in storage. This is 331 million ounces of KNOWN reserves. He got this number from the "World Silver Survey 2000". He says this includes 129 million ounces held by Berkshire Hathaway (Buffett) so, he reasoned, there were about 200 million ounces available with an ongoing deficit of about 10 million per month. This means that, if the supply/demand situation remained the same, there was enough to cover the deficit for 20 months from year end 1999.
Twenty months from that time ends at the end of this month.
The biggest mystery in silver is "how much more is available that we don't know about".
I believe the Comex may be the last place users of physical silver will buy. When they are forced to take delivery there (when their usual sellers can not fill their orders) the world may wake up to the shortage situation.
Netking is correct in that rumors of PRC or other silver sources keep appearing, usually from places that can not be verified. There are also rumors as Sierra Madre mentioned, of shortages.
To be continued,

site stewardFederal funds trade on target this morning, the Fed adds to bank reserves anyway#592198/8/01; 17:19:01

Banks were able to fetch overnight funding in line with the FOMC target rate at 3.75 percent, so it would seem that the Trading Desk at the Federal Reserve Bank of New York would be in for a light day having no impetus from the monetary policy side of their objectives.

That being said, however, the Fed not only added $4.245 billion in temporary reserves to the nation's banking system through open market operations with overnight repurchase agreements, the Fed also engaged in an outright purchase of Treasury bills to permanently add $2.13 billion to banking system reserves.

Extra note:
To Gandalf, on "education", who said to me yesterday, ---"Pardon me! Does that mean that you are again selected to EDUCATE all of us?"---

It seems that your crystal ball gave you access to an email message I provided for the eyes of somebody else. A most remarkable tool you have there! And if this is the score, I can only hope you were privy to the context of the whole exchange.

As I think about your question, I am left wondering why such a question is posed to begin with -- after all, we all know that "education" in life for every person abruptly stops the very moment they walk out of their public and private schools. It is surely unthinkable that someone might, of their own free will, be inclined to seek out additional information or insights wherever they might reasonably be found.

On the level now, that paragraph was written "tongue-in-cheek", but judging from the tone you offered, am I to conclude that you hold such attempts to foster the ease of post-graduate education as completely wasted efforts, unappreciated by all others?

Or put another way, whether intended as educational or not, is it unacceptable for me in particular to offer such news as you see in this post for fear that somebody might become better educated as a consequence of reading it? The horror of it!

I am quite sure I can put your fears to rest that I might educate innocent bystanders. A website such as this will only provide as much or as little educational value as each individual is willing or able to get out of it as a result of their own directed effort to participate, absorb, and ultimately think for themselves.

I remain puzzled that my involvement in this website operation has somehow become a source of displeasure for you in particular. Are you not appeased that, so long as we are both civil about it (civility is the KEY), you remain free to post whatever you think about gold, whereas I -- in an official capacity -- am now constrained (by rule of experience) to regurgitate only the mainstream news so as not to excessively stir the passions and thoughts of those very few who have no mind to master themselves for civil discussion? Who wins here?

Again, this entire website can give only as much (or as little) value as the individual visitor strives to gain from it. Methinks you have put too much upon my door if you see more than this when you come knocking.


BR549Notes on ......... "WHEN TO BUY" #592208/8/01; 17:19:51

@ ski (#: 59214)

Enjoyed your post. I am sure that you have made a lot of money knowing when to buy, sell, and what to buy. One quick question though in re: "2. Anytime you can buy a commodity that is in demand for less than it's cost of production, in the long haul it will pay off."

If the current cost of mining gold around $290U$/oz. and the current spot gold around $268U$/oz., how far away is "the long haul"?

My other comment is: I would think your guidelines assume a supply & demand driven market free of manipulative practices. Or do you? Thanks for the input.

By the way, it was in the mid/high 90's down here in Cornfield County today (it is usually hot in August but this Hurricane has cooled things off). What is the problem with the low 90's in NY and the Midwest? It would seem like "SprangTime" to us.

Regards from Cornfield County.

site stewardNews for Canuck on silver#592218/8/01; 17:35:50

You said, "it seems only two camps exist; the silver 'to the moon' camp and the 'silver-is dead' camp."----

Don't close the casket yet. This article shows that silver's salvation is at, at foot, rather.
HEADLINE: A silver dagger against stinky sandals?

NEW YORK, Aug 8 (Reuters) - If the hot summer weather has you wearing athletic sandals with black rubber soles and Velcro fasteners, and the sandals have gotten damp, you've probably noticed an offensive odor wafting around. The marketer of Teva sandals ... has a solution ... an antimicrobial compound built in. The silver-based compound is effective against a broad range of bacteria, mold and mildew, the company said.

R PowellMore on Silver#592228/8/01; 18:03:00

Another reason for the apparent lack of drawdown of silver stock on the Comex is that the Comex is a paper game of futures and options. Both Butler and Morgan have surmised that those consuming supply on a regular basis do not bother with exchanges. However, there are usually existing contracts for much more silver than Comex holds and if users are forced to turn there for supply, then many of the monthly contracts will call for delivery at some point and a tremendous short squeeze will occur.
Canuck, the Strategic Defence Dept shipped the last 13 million ounces of it's (and the U.S. government's) silver to the mints for Silver Eagles. This was shipped this past Spring (? if memory is correct). Supposedly, this would last through 2001. Depending upon whose numbers we look at, this is the last of around 4-5 billion ounces that the government possessed right after WW2. However, the amount of silver used in coins is small in comparison to photography and industrial use.
I read a tremendous amount of opinions from many, many commodity analysts and almost none see the ongoing deficit of an inelastic metal.
I believe most fund traders are simply chart readers (trend followers) who are totally ignorant of the fundamentals of supply and demand. Maybe the smart money is quietly positioning themselves long but then again, maybe the smart money knows of large available stores of silver that we are ignorant of??
I find it hard to believe that analysts such as Butler, Morgan, Buffett, Soros and Gates who are all invested on the long side of silver, would not know of such supplies if they do exist.
If we are reading this correctly, it will probably continue right up to the time when industrial users can not get enough from their suppliers. If so, then the POS could concievable lock "limit-up" for days on the Comex. If this happens, spot POS will not be limited and could skyrocket in literally minutes!
I'm obviously biased from the long side but can not see how this situation can continue indefinitely (or even for much longer). However, this is, as always, just one poor man's opinion and not investment advice.
Also, I've sent a check for the current World Silver Survey 2001 which will have numbers through the end of year 2000. Hopefully, it has a great deal of info so I don't get the lack of new news/info Jones. I need a constant silver/gold "happenings" or fix to keep (as auspec would say) the Moxy and Mo-Jo going.
Sometimes when the supply/demand/carryover numbers of a commodity simply don't compute, the USDA (in things like grains) or others (like the GFMS or the World Silver Survey) will be forced to simply change the estimated available supply from previous years. It seems that analysing commodity fundamentals is somewhat like studing philosophy in that often there are no correct answers (or numbers). Simply put, no one knows for sure how much exists. At least, no one that I've heard from. As far as the market goes, it's not listening anyway, IMHO.

Solomon WeaverDid someone say silver??#592238/8/01; 18:41:09

Tree in the Forest

"Don't make the mistake of riding a loser into the ground like people who bought gold at $850. Or people who let a 5 million dollar position in Cisco fall to 1 million. Etc. etc. Have a silver stop in mind. If it falls below your loss tolerance, get out and concentrate on gold. You can buy back your silver at lower prices later on."

Hey is my silver stop.....if the thousand (hypothetical) ounces I have sitting in junk and rounds ever magically turns into 900 ounces, I will figure something is causing my silver to vanish and I will sell.

One part of my silver stash is 500 1998 Eagles I picked up in 1999 on a pre y2k buy.....I keep one of those coins in my pocket and engage people in conversations about tends to wear down and get a circulated look...perhaps diminishing the value slightly....but that loss is compensated by the educational value....and I tell people "for less than $4000 you can get 500 of these, how much did you invest in the NASDAQ"....I like jazz and there is this old song that Sinatra sang and Diana Krall has done a nice job with..."the way you sing off key...oh THEY CAN'T TAKE THAT AWAY FROM ME...." It sort of runs through my head every time...there are about 50 people out there who know from this fool that it is actually possible to buy silver coins and get them in the mail...and of course I always tell them about USAGold...for education and physical gold....I wonder how many took up my advice.

I am extremely excited to see the level of interest that little brother silver has commanded around here as of late. The poor man's gold.

What I see holding silver down is the fact that 800 million leased ounces times a $4.5 is "only $3.6 billion"...where the 12,000 ton leased gold ounces times $10 million a ton is "$120 billion". As long is there is "any" decent paper liquidity left, the paper tigers will dominate the quoted price of silver. All you need to keep silver paper price under control is a flyswatter.

Does this mean silver is a bad investment?

40 years ago, there was enough silver in vaults to give more than 1 ounce to each world citizen. In the same 40 years, about 1/6 of the world's citizens living in developed nations have consumed about 15 ounces per capita of silver and about 40% of that has come from reserves we no longer had.

Now, we want (must) to create a world in the next 40 years where population increases by say 2 billion, but the number of "developed nation citizens" increases by 2-3 billion....another way to say this is that we will quadruple the number of people using silver, probably see a 20-30% per capita increase in silver production, and we must make more than 100% of our needs going forward, since we have exhausted our stockpiles.

And this has nothing to do with the poor man realizing he might "invest, save, hoard silver".

So folks, I am poor old Solomon, but I am pretty much expecting to live the next 40 years, so I'm pretty sure I'll find the right time to "sell" silver down the road.....

Big smile to all you closet silver bugs (Trail Guide included).

Poor Old Solomon

R PowellHBM/Tree in Forest#592248/8/01; 19:01:42

HBM, I just read your post from yesterday. Thanks for the kind words. We're not only both self employed, we're also the same age (picked that up from one of your earlier posts). We all have to work for a living. Most self employed are reasonably happy in what they do, probably because they've found something they have a knack for and are good at. Concrete work isn't that hard because I like doing it and could never again tolerate (or afford) pay by the hour or working without making the decisions that affect what I have to deal with! Also, it leaves me time to pursue other research, often here. Independence and an interest in gold/silver seem to go hand in hand.
Tree, your (59183) question of why the POS does not go up, especially in the face of the ongoing deficit is a question I ask often. I can only guess that too few see the situation as we do. Obviously, there is more selling than buying on the exchanges where the price is determined. Either the market is blind or we are?? I've noticed from that far fewer signatures had been collected than I would have guessed. We may be far fewer than we think we are. I think even the majority of those who study these markets will be truely amazed when POG and POS go up sharply. But, who knows? Butler has been screaming
for higher silver prices for years.
So many questions, so few answers?

Black BladeForbes Body Count#592258/8/01; 19:06:42

More carcasses added the the growing "Bone Pile." There are likely to be more layoffs over the coming months. The High Tech industry has been hit especially hard. Where college grads were given jobs ahead of graduation, many now are recieving letters from these propective employers informing them that those jobs are no longer available. A real life lesson for many.
auspecRich & Soloman #592268/8/01; 19:10:11

Thanks for the silver posts. Only two variables remain with silver:

1- Unofficial silver supply.

2- Timing for the bull.

I would sure hate to wander the wilderness another 40 years, but of course that will never be necessary. They can't even wag the dog on us with silver, as war is extraordinarily bullish for precious and non precious metals. Re-read this last sentence all silver fans! Gee, I wonder if there will be any wars in the next several years?
Anyone, what are the chartists calling for in silver for a low? I believe some are absolutely delighted to see $4.15 POS, as had been looking for it.
Remember, all those freaked out by this Victor Flores {?} guru with Weiss investments, same folks called for $200 POG right before the WA and $330 POG.
If a billion ounces remain to continue to throw at a free silver market, so what? The low POS simply prohibits supply from gaining enough steam to balance the long term equation. Buy your commodities well below the cost of production and patiently await the renaissance.
Be the first one on your block,
To have your fortune come home in a box!

P.S. Once again, The Constitution, a brilliant document in search of a country.

Black BladeRE: R Powell and HBM#592278/8/01; 19:14:23

Self Employment! I wouldn't have it any other way. It is great to sell one's skills on the open market to the highest bidder. That is why I closed up shop in Mining country (North Nevada)and came to the Petroleum side. It is a freedom that unfortunately many don't have. I have been self employed for many years and I could never work for some imbecil with an IQ below that of your typical toaster, or some company that tries to take advantage of a slowing economy by requesting that contractors charge lower rates and other concessions. Sure, the government paper work is a nightmare at times, but that is why we have CPA's I guess. Cheers!

- Black Blade (Scientist at Large)

Black BladeAsian Markets Collapse#592288/8/01; 19:22:07

Asian markets look ugly tonight. A virtual "Sea of Red." It could continue for a while. US markets don't look good either. The US market indices are grossly overvalued due to falling earnings giving rise to absurd PE ratios. How much is one willing to paying for each dollar in earnings or even the propects of a company with no earnings? Sleepers are beginning to awaken and face reality. I suspect many will take their remaining chips off the table.

- Black Blade

TannehillFlat Panel Displays#592298/8/01; 19:30:36

If you have a flat panel display, you may be looking at the reason for the demise of several silver mines.

That's all from Tannehill.

Black BladeStocks Fall on Fed Report, Cisco View#592308/8/01; 19:31:58


NEW YORK (Reuters) - Stocks fell on Wednesday as a bleak report on the economy exacerbated Wall Street's worries about tumbling corporate profits and spooked investors already upset by a dismal quarterly forecast from technology bellwether Cisco Systems Inc. (Nasdaq:CSCO) ``It's just a continuation of no good news and nothing to really demand that people step up and pat the pony and start buying stocks,'' said Ned Collins, a trader at Daiwa Securities America.

The Federal Reserve, in its anecdotal survey of national economic conditions, also known as the ``beige book,'' said the economy remained sluggish in June and July, and the manufacturing sector's woes had begun to bleed into other areas of the economy. ``What's weighing on people is that recovery isn't coming any time soon,'' said Peter Boockvar, a trader for Miller Tabak & Co. ``Here we are already into the third quarter and we don't see signs of an upturn. Investors have to re-evaluate their exposure to the stock market.''

Black Blade: A good time to look at hard assets before the coming plunge into the abyss. Can't hold a few barrels of oil? Then try gold and silver. Perhaps we are facing the "Great Depression II."

Max RabbitzSite Steward#592318/8/01; 19:43:18

I for one welcome any and all attempts to educate. There is much confusion in the land. My Crystal Ball fails. Here is something I'm a bit confused by. The Fed appears to be adding lots of reserves to the system. My understanding is that these reserves can only be turned into multiple quantities of money by the wonder of fractional reserve banking and then only if someone borrows. Yet the "Beige book" today said the demand for loans was slack. Does this Fed action thus only increase the potential for money inflation?

BTW.... was it you who defined money as an abstract unit of value? I like it. Fits the digital age. Sometimes I think people like to have it both ways. They want to be able to earn interest on an asset yet have it a stable wealth value. But with all honesty you can only earn real interest on something that you put at risk. The more risk the more interest. And anything put at risk will vary in value according to the winds of fate. If you want gold......and don't lease it.

Tree in the ForestAll-silver#592328/8/01; 19:51:05

For me the issue is not whether silver will fly. I'll take the three wise men's word on that. It's where will it go before it takes off that's bothering me. Sure you could have bought gold in 1985 at $500(?) an oz and held it for 16 years(and counting) knowing that eventually it would be worth more. You could have bought stocks in 1929 and held them for 40 years and eventually made money. And those holding Cisco will eventually get their money back too. The problem is that buy and hold isn't always best option if the opportunity cost is high. In addition to physical silver, there are silver mining stocks which may fall significantly if silver is a no-show. It doesn't pay to hold a stock while it loses half or more of its value. All I'm saying is, keep your eye on the POS. That's all I'm saying.
Black BladeRed-hot U.S. Midwest sets power records, outages#592338/8/01; 19:52:21


SAN FRANCISCO, Aug 8 (Reuters) - Sweltering temperatures is sucking up electricity supplies from the U.S. heartland, taxing power grids, causing heat-related outages and sparking fresh records for power use. ``We've had a string of 90 degree-plus (32 C) days, and the latest heat wave has been the hottest and longest,'' said Mary Sandok, a spokeswoman with Minneapolis, Minn.-based Xcel Energy Inc. (NYSE:XEL).

Steve Brash, a spokesman for Cincinnati, Ohio-based Cinergy Corp. (NYSE:CIN), said that while ECAR's capacity margin was less than 10 percent two years ago, it is now more than 12 percent. Unlike California's relatively spartan power grid, the Midwest has a strong interconnected transmission system with about 14 interconnections in and out of Cinergy, Brash said. He also noted that temperatures held above 90 degrees Fahrenheit for two straight weeks in 1999. ``We haven't had that in this period,'' Brash said, adding there were at least two days last week in which temperatures did not reach 90 degrees (32 C).

Black Blade: Decaying energy grid is overtaxed and can't keep up with demand. Anytime we have a little excess heat or cold, the cracks in the system are exposed. More power is needed and it is in short supply. This situation is pervasive all over the US. Grasshoppers everywhere are opposed to building new infrastructure and finding new energy supplies, yet they complain about higher energy costs. I guess they are simply products of the US education system. Energy costs will remain high and these costs are passed along to the consumer as I said would happen long ago. As inflation reality hits the economy and the consumer, PMs and other hard assets will do their work as portfolio insurance. Home sales have done well - not as a result of a robust economy - but rather as people rush to put cash into hard assets. PMs could become part of this trend soon.

BTW, The Canadians have come to the rescue of the Northeast US the last several days with some electricity. Otherwise the Northeast US would have been "Blacked Out" for the last week. "Oh Canada!"

site stewardEurosystem international reserves -- week ended August 3rd#592348/8/01; 19:53:17

Within the ECB and 12 member central banks the value held as gold and gold receivables declined EUR 24 million while the value held as foreign currency declined over 16 times that amount, down EUR 400 million.

Gold reserves dropped by EUR 24 million due to combined effects. The Bundesbank's issue of one million 1 Deutschemark commemorative coins involved the allocation of nearly one-and-a-half tonnes attributed to this week's book (8.5 tonnes allocated to this project were represented on the previous week's book). In addition to this, there was a one tonne sale by another central bank (likely the Dutch's fifth tonne sold since February 2000). Taken together, this leaves the consolidated Eurosystem with EUR 128.381 billion (12,546 tonnes) in gold.

By contrast, the EUR 400 million reduction of the Eurosystem's foreign currency during the past week (as mentioned above) leaves the net position in foreign paper valued at EUR 273.7 billion.

The next mark-to-market revaluation of these gold and foreign currency assets will occur September 28th.


Black BladeNew York Declares Power Emergency#592358/8/01; 20:02:54


NEW YORK (Reuters) - On the hottest day of the year, New York urged residents to conserve electricity amid warnings that soaring demand and problems at a few local power plants had cut deeply into the grid's available power supplies. Millions of New York City workers were told over their office public address systems that the New York Independent System Operator (NYISO), which manages the New York power system, had declared an energy emergency and Consolidated Edison Inc., the city's main electric utility, called for power load reductions until 7 p.m. Eastern Time.

Although it is not the first energy emergency for the Big Apple, it is the first time the NYISO has activated a new emergency demand reduction program in New York City that calls on major businesses and building managers to voluntarily throttle back their power usage. ``With the entire Northeast setting new power demand records, we are being proactive in calling on the emergency demand reduction program now,'' NYISO spokesman Steve Sullivan told Reuters.

Black Blade: Although this energy crisis isn't just oil, it is more pervasive, slowly building momentum and very long term (The Slow Burn). We cannot rely on the ("OPEC of the north") to save our bacon each time there's a crisis. This energy crisis will continue to build in the face of growing demand and the "Ostrich Syndrome."

Black BladeCash Keeps Surging Out of Stock Funds#592368/8/01; 20:14:51


As stock prices stumble, it seems buy-and-hold types are neither buying nor holding. One of the fund industry's oldest rules is that cash flows to funds tend to follow performance. So with the S&P 500, the Nasdaq Composite and the average big-cap growth fund down 16%, 44% and 31% over the past year, it's no surprise that flows have gone south. But the scale of their drop has become dramatic. Redemptions from stock funds outpaced investments by some $11 billion in July, when the S&P 500 fell 6%, according to preliminary estimates released Monday from liquidity tracker If these estimates are accurate, July will be the third month of net outflows for stock funds this year. There were no such months in 1999 or 2000 and just one in 1998.

Black Blade: I remember old Ross Perot saying something about a "Great Sucking Sound." Instead of NAFTA, it is the sound of cash sucked out of stocks.

Max RabbitzRich Powell and the Petition#592378/8/01; 20:26:31

Not everyone is comfortable revealing their home address on a petition. With the history of our government in gold confiscation and manipulation you've got to have a secure hiding spot and/or a large gauge shot-gun to risk it. I considered withdrawing my name. But hey, there comes a time....if it's just a commodity what's the problem with answering a few simple questions. I accept TG's analysis that "our gold" is political gold for the defense of U.S. currency in foreign trade and I expect the gold has already been committed in all but deed. Nevertheless, I think the system was designed by and for the bankers and left the American taxpayer holding the bag.
Cavan Mansite steward (ho hum)#592388/8/01; 20:53:02


Where do you suppose the EUR 400mm went? How are these sorts of transactions effected? Thanks...CM

Cavan ManBlack Blade#592398/8/01; 20:55:36

I grew up in NY in the 60's and blackouts were common then. I suppose the difference now is we are far behind the curve in an environment that requires ever so much more energy? This fact in conjunction with your, "the rest of the story"?
site stewardTo Max Rabbitz#592408/8/01; 21:02:11

Max Rabbitz says, ---"these reserves can only be turned into multiple quantities of money by the wonder of fractional reserve banking and then only if someone borrows. Yet the "Beige book" today said the demand for loans was slack. Does this Fed action thus only increase the potential for money inflation?"----

Depending upon the penchant for public or private borrowing, at a minimum the Fed additions maintain the existing potential for money inflation, or at most, they can increase the level of that potential inflation. It really depends upon whether the Fed's operations are merely to offset any given drawdown in existing reserves, or whether they are injecting what we may call 'surplus reserves' above and beyond the reserve requirement. As far as 'offsets' go, might "big money" simply be pulling funds out of the U.S. banking system???

You also asked, ---"was it you who defined money as an abstract unit of value? I like it. Fits the digital age. Sometimes I think people like to have it both ways. They want to be able to earn interest on an asset yet have it a stable wealth value. But with all honesty you can only earn real interest on something that you put at risk. The more risk the more interest. And anything put at risk will vary in value according to the winds of fate."---

Nice thoughts there, but my lips are sealed against elaboration! <smile> You can read a mid-portion of a larger presentation if you click on the achive URL given above. Then scroll down to this post where I compared and contrasted money as a flexible unit of "manpower" against as such things as scientifically defined "horsepower" and also concepts of ownership. Best of all, its a SHORT commentary!

Have a look for the following within the link above:

Randy (@ The Tower) (07/03/01; msg#: 57382)

[[[and if you liked that one, you may be interested in another short one posted a week earlier:
Randy (@ The Tower) (06/28/01; msg#: 57115)
and see also TrailGuide's response:
Trail Guide (06/29/01; msg#: 57160)]]]


Black BladeRE: Cavan Man - Blackouts and More#592418/8/01; 21:55:37

There have always been infrastructure problems on the east coast. The energy grid was in various states of disrepair even then. Now the grid is just older and still in various states of disrepair with growing demand. Add some inclement weather, an occasional coronal mass ejection, and the occasional squirrel fried in a transformer, - then there are the resulting blackouts. I was back east (Rhode Island) when the lights went out in 1967. The whole east coast went dark. I think that there was even a movie made about it. There was also a boost in the population 9 months later. The energy crisis this time, aside from the same old reasons, includes a few more fundamental reasons such as demand growing faster than supply - mostly due to the advances of the "New Economy," NIMBY, and rabid environmentalism. All of this results in higher energy costs that are eventually either passed on to you and me - inflation, or absorbed by business - squeezing profit margins and tanking the stock market resulting in a reversal of the "wealth effect." Either way, stocking up on some portfolio insurance can't hurt while prices are low, and stocking up on a few nonperishable goods as common sense family security insurance. Hoarding? - Just common sense. It's "The Ant vs. the Grasshopper" mentality - or as many here would say - personal responsibility. Cheers!

- Black Blade

Black BladeAsia Tonight!#5924208/08/01; 23:09:49

Asian Markets are getting thoroughly slaughtered tonight! No one is being spared. This could wash over into tomorrow's trading unless the Working Groups on Financial Markets pull out all the stops and start buying index futures. Looks really ugly!
MO VER MEGBlack Blade#5924308/08/01; 23:43:11

How was the Sturgis Rally? I will try to meet you there next year.

I made the trip to Casper last month - interesting coal/oil country. Traveling west out of Newcastle (through True Oil country) was very interesting. Thunder Basin Coal was impressive.

Just letting you know, I listen to what you have to say.



Black BladeRE: MO VER MEG#592448/9/01; 00:45:58

Good to see you here!

Sturgis was fun, however, the real action is all around the region as thousands of bikers troll around various towns. I passed through Newcastle this morning on my way to Sundance and then Hullet (sp?), Wyoming for the "Ham and Jam." I got back this afternoon. I took my spare laptop as you could tell. I stayed at Keystone, SD Best Western with my Grasshopper friends from Kalifornia. They all seem a bit concerned about the current employment situation in tech as some work in that industry and a good friend's wife was laid off last Friday (she still made Sturgis though - that's dedication!). They think that the Energy and Ute Barrons are ripping them off, yet when pressed they admit to the Grasshopper ideals that led to the energy crisis. They are a good case study in human nature. If I get off early tomorrow I may catch up with them at the Custer - Bighorn Battlefield in the afternoon. I also made it to the Mount Rushmore lighting ceremony, It does tug at one's patriotic heart-strings, however, the pesentation is dripping with political correctness that detracts from the intended message. Cheers!

- Black Blade

Golden Dreams All!

Black BladeAsian Markets Getting Slaughtered!!!#592458/9/01; 00:58:29

Nikkei plummets well below 12,000! This looks like a market crash! All Asia in turmoil tonight. They can't sell fast enough. Could carry over to Europe and the US today. Depends how the Working Groups on Financial Markets respond before the open. Perhaps they will buy heavy into index futures to stave off a market collapse.
skiPoints to Ponder#592468/9/01; 01:06:21

BR549 #59220

....."With current gold mining costs around $290 and current spot around $268, how far away is the "long haul""?

More than anything else, it depends on the size of the current stockpiles. Uranium is an excellent example. Large stockpiles were in part the result of high uranium prices. When the uranium price finally collapsed below the cost of production, it took about 13 years or so to use up the supply. Personally, I am not nearly as excited about gold as I am for silver due to the fact that the world just keeps accumulating more all the time as it is not consumed or otherwise lost. Also, because gold was ABOVE its cost of production for so long, there was a gang of exploration and discovery done .... which is now waiting in the gold pipeline. I've been to the some of the trade shows and it seems that EVERYONE has a great gold project that is waiting for higher prices.
(Generally, not so with silver and uranium.)

When a commodity is below its cost of production for YEARS, new exploration and project development almost stops. Don't get me entirely wrong. I do like the supply and demand picture for gold as it clearly suggests that Au must go higher at some point. But here is the question for any investor ..... Would you rather own a $4 stock that only moved up to $6 or a $100 dollar stock that moved all the way up to $120? As basic as this question is, some don't get it. The $4 stock went up 50% and the other stock only gained 20%. So what is the moral of the story? The moral is that it is the PERCENTAGE MOVE THAT IS IMPORTANT. This explains my greater interest in silver. It will undoubtedly go up by a higher percentage.


In my own unofficial pole, it seems like the current silver dip is doing a good job of shaking the confidence of many. Odd thing here .... If you take a look at many different charts from all periods and places in history, you quite often see a significant dip just before a major bull market begins. This phenomenon is more common than you would think. My hope here is that this is what is currently happening in silver.


In my state, you do not have to pay any state sales tax on gold bullion purchases but you do have to pay sales tax on silver purchases under $1,000. I often find myself with a little less than the 1K. When that happens, I give someone a little sales pitch on silver and show them a couple of silver rounds. I never thought of myself as a very good salesman but, I have never been turned down with this approach. They are usually grateful and quite facinated with the shiny stuff.

NetkingCanuck / Tree in the Forest / Rich. etc - Ag#592478/9/01; 02:47:18

Canuck > Yes the 'disinformation' is abundant, to the point where it seems only two camps exist; the silver 'to the moon' camp and the 'silver-is dead' camp. There seems to be no middle ground.

Netking > I am unashamedly in the former camp Sir Canuck. I've studied & studied this market for a while now. I have read whatever I can get my hands on. What I don't know I've attempted to try & find out or have E mailed people that know. There is still so much to learn & know, but I know enough that silver "will have it's day in the sun" . . . soon.

Canuck > The fact that silver coinage stopped in 1967/68? seems to explain to me, at least to a degree, why inventories have plummeted. Now ask 50 people in 'the know' about silver use in photography and you get 25 'camp 1' answers and 25 'camp 2' two answers.

Netking > I believe at this time traditional photography has shown no "significant" demand run off of Ag. The silver bears suggested the digital camera would kill film in 2 years . . . didn't happen. Sure it will ease off over time but other new uses (IMO) will more than make up for loss of demand in this area. China the biggest photography market appears to be cooking along. Any weakening in other industrial use at this time would also it would appear to be more than offset by cut backs in mine production currently.

Canuck > I am getting a little worried. I accumulated a modest stash of gold pre-Y2K and since a modest stash of silver. I think I am more comfortable with the gold at this moment. Silver does seem more 'commodity' based, yes? I am getting a little worried about my overall exposure to both. At first guess I am probably close to 50% exposed in terms of total net worth in gold and silver. 'Missed opportunities grow very large. Thoughts/advice? Canuck.

Netking > Depending on the size of your holding in ounces & dollar terms & also the percentage size of it as measured against your family net worth . . . it may be worth looking at investing in a consultancy appointment with Dave Morgan, Ted Butler or our own host Michael J. Kosares/USAGOLD (I don't know if all these guys currently do individual consultancy or what the arrangements would be, it was just a thought). The other thing is assuming your family & financial needs are catered for cashflow wise where else would one invest in the current global markets . . . . property, USD denominated investments, shares . . .no? PM's stands out with "everthing to gain in the days ahead and very little down side" IMO. At the end of the though you gotta have peace about what you're doing, otherwise make some adjustments. There are some excellent articles with a ton of insight at the next two links, I would personally suggest to anybody to read 'em all & study the facts and arguments:
and this interview from earlier this year.
R Powell > I believe the Comex may be the last place users of physical silver will buy. When they are forced to take delivery there (when their usual sellers can not fill their orders) the world may wake up to the shortage situation.

Netking > Sir Rich. I agree totally. Comex may well be the gauge by which we can measure the last physical stockpile disappear. Intresting about the Hunt Bro's, they paid I believe up to $14/Oz before the squeeze . . . that pushed up the POS to over $50/Oz. (Double+ for todays $) So they paid up to a bargain price of $28/Oz(2001 $) when world & USA supply was much more than today . . . . now that's food for thought.
Tree in the Forest(59232)> For me the issue is not whether silver will fly. I'll take the three wise men's word on that. It's where will it go before it takes off that's bothering me.

Netking > Agree Sir TIF, it WILL fly, this baby will run on "nitro" when it moves. As TB said in a recent article (Refer link: ) it's not a case of placing a date on "it" in terms of when, but rather knowing how & what. We do know largely "how" and we do also largely know "what" will happen. If silver is at 5,000 year inflation adjusted lows (and it is). If silver's independently surved world (known) inventory has largely run out (and they are, nobody can prove otherwise). If demand for silver is increasing each year (and it is). If supply cannot keep up with that demand (and it can't). If new uses & applications for silver keep coming up (eg power line technology & batter technology for just two of many that will use much) indicate silver will be in it's 12th, 13th 14th . . . etc year of deficit . . . . then I say to myself "use this time of aberration of price as a door of opportunity to accumulate physical silver (and gold).
Randy - You quoted that excellent statement from Sir Canuck, "It seems only two camps exist; the silver 'to the moon' camp and the 'silver-is dead' camp."
Netking > Randy? . . . . so which camp you in brother?

regards all - Netking.

wolfPetition give it your support#592488/9/01; 03:33:48

Clarify US. Policy on Gold and Gold Accounting

Signatures so far : ONLY 1.338

Goal : 10.000

Deadline : ongoing .........


miner49erArgentina - Pay taxes with bonds#592498/9/01; 05:31:06

Good morning all,

Been a while, but do check in on occasion... Haven't had time to think about this (still groggy, not having had a cup of coffee, yet...). Heard briefly about it last night, and searched around all my usual financial news areas for some analysis, but came up with absolutely nothing.

Anyone got any thoughts about this?

Most cordially,

Canuck@ Netking and others#592508/9/01; 05:42:36

Thanks for your silver posts.

My office deals with a chain of photography stores in Ottawa. I once asked this cagey misery looking dude about
silver as an investment. It indeed hit a nerve. He immediately began frothing about the Hunt scandel and how much money he had lost in the early 80's. He cited sales of digital cameras and the accelerating recycling of the silver solution used for film processing.

He said silver use was plummeting in the photography world and was 'dead' and also said buy gold when 'T.S.H.T.F.'

He was definitely of Camp 2.

I saw ( a year or so ago) a chart on the DOW/POS ratio; it is startling. I forget the exact numbers, perhaps in the order of 50:1 in 1980 and 2,500:1 today. Definitely Camp 1 material. I also like the 'inflation adjusted' numbers for silver. Amazing how silver is 'undervalued'.

Where am I? Well I go both I mean to say is I like the Camp 1 numbers; they seem way out of whack.
In reference to the 'investment counselling' remark, I have a financial advisor, you know diversication, no more than 5-10% precial metals, the long haul blah, blah, blah. My problem at age 41, is I started too late in the 'savings program', long shots are required.

The 10, 20, 50, 100+ 'bagger' stories are very appealing, yes? I see very little downside as I am sure most of us feel. What's that ancient 16:1 POG/POS ratio? Let's see,
a 25 bagger in gold makes the number 6,750POG/421POS. A 25 bagger in silver makes the number 1,680POG/105POS. Let's go mental here with FOA's $30,000 gold with the 16:1; $30,000POG/1075POS.

Wicked!! I'll buy............Argentina!!

Black BladeIndex Futures to the Rescue#592518/9/01; 06:06:07

Index futures are off the lows as apparently "someone" is buying heavy positions. I hear the talking heads and Pied Pipers are spinning the "We found a bottom" talk once again. Can they navigate the SS Titanic through these icebergs today? We will see.
Cavan ManHello Canuck#592528/9/01; 06:15:49

I am sitting here enjoying a cup of tea as I prepare to go outside and do battle with our famous midwestern humidity. I enjoy your posts very much and your last one prompted me to chime in. I have been thinking about portfolio allocation these last few days and want to say to you that I am in the same camp. I am about the same age and, like you, learned the wisdom of saving and investing late in life (spent way too much time in the taverns chasing the skirts). I don't know a lot about silver but I have studied gold intensely over the last two years. I have quite literally been reading and thinking gold (gold fever?)all that time. I have read every fact, every opinion, every analysis, every economic philosophy and every bit of nit wittery the www has had to offer. IMHO, at this time, a person should disregard that old "portfolio allocation wisdom" and own as much gold as is understandable. Now is the time to own gold. Now is the time for the big play on gold. I do not see any other investments that provide the value and the low risk/high reward ratio that gold has to offer. Why here, even our own real estat market has become "Son of Nasduck". If you are like me, build a bridge to a new lifstyle. Good luck...CM
Belgian@ Ski#592538/9/01; 06:18:02

Sir, allow me to reflect on your post #59246 and please note that I've no intention to correct your vieuws, with these reflexions. Thanks

1/ Uranium is a mining by-product in many cases. South Africa had plenty of it (Chemwess).
2/ The percentage gain story, changes dramatically, when the price drops to 50% of your average accumulation price.
3/ The fact that here in europ we pay 25% VAT on silver and 0% VAT on Gold is "VERY" significant to me ! This does make a fundamental difference between an industrial commodity (silver) and the universal store of wealth (gold).

4/ The most important aspect about Gold at this particular moment in its history (past 30 years) is that there exists a very high probability that a *Big Change* is on the horizon ! We (all) make the same <linear-thinking> mistake, over and over again. As to drive, with constantly looking into the rear is different now ...too late !
With this, I am "NOT" suggesting that silver is dead ! I simply don't know ! And I do agree that 4$/ounce is a give away (abnormal) price, the more that global re-(hyper)inflation, "inevitably", is the next decor for expansion.

This leaves us only to change ideas about the quality of choice between gold and silver-accumulation (physical). They will both have their day, but wich one will outperform and with how much. What " WILL BE " the differences between both ? Rather than what *were* the differences !
I prefer to generate paper with other instruments (stocks) and store eventual profits in Gold, physical Gold (for ever). Optically more expensive, perhaps because it is (and always was),intrinsically more valuable ?

Suggestion : go to and type "gold" into the searcher and see with your own eyes, what is evolving.

For reasons that the future is so unpredictable, Gold is (imvho) in pole position for the new "valuation" era.
Speculating on a procentual better fiat-return for silver is believing that no dramatical changes will occur, isn't it ? Any other vieuws, that I have overlooked ?

Max RabbitzWill the Feds stop selling TIPS? Are they worried about something?#592548/9/01; 07:44:46

"Expectations the securities will be in short supply have also stoked the market for them in recent weeks.

U.S. Treasury inflation-linked debt issuance has totaled $135 billion, or less than 5 percent of the government's $3 trillion in interest-bearing, marketable debt.

A Wall Street panel in May advised the Treasury to stop selling inflation-indexed debt, saying the program has cost the government an extra $1.5 billion in interest."

P.S. Thanks for the links Randy.

CoBra(too)Up to 15 People killed and another 85 injured in Jerusalem,#5925508/09/01; 08:10:47

According to police sources.

Another suicide bombing in a Jerusalem Pizzeria - could well trigger off heavy retaliation by the Sharon government, escalating to outright war?

The early POG spike is telling, no? - though I personally would feel the fundamentals for a rising POG are sound enough and don't really need a ME war, nor do I.


RockgrabberBomb Kills 19 in Israel#5925608/09/01; 08:30:19

Is Israel ready to retaliate this time for this one? I bet so.
Belgian270,65 $#5925708/09/01; 08:56:50

POG strength with easing/unchanged POO : with the recent Israel bombing, enhancing a trend, or only just an emotional insignificant hiccup ? POG remains well contained and mini-move is disciplined. Significant altough, against clear European + US evidence of economic contraction (defla). No indications from mining. Already account a POG=300$.
War is another mice-step closer today. Evolving to half-way presidential cycle (theory). POG 271,15 + Dow in search for the 10.000 psychological dam. This looks nice (?)

Saxulum^Belgian (59253)#5925808/09/01; 09:22:40

Belgian (59253)
---3/ The fact that here in europ we pay 25% VAT on silver and 0% VAT on Gold is "VERY"
significant to me ! This does make a fundamental difference between an industrial
commodity (silver) and the universal store of wealth (gold).---

Dear Sir, or should I say neighbour :-)
Just in case you are not familiar with the following:
Silver can be bought overhere officially with 0% VAT
in the form of bulk old coins (ca 72% silver content?).
Don't know if MK is aware of that either, so check it out…
If preferred, it than can be easily melted into "broodjes"
And while I'm here, a great 'Thank You' for sharing
all of your ponderings and research. Very helpfull!

miner49erWinston Smith may be out of a job.#5925908/09/01; 09:37:06,10821,534220,00.html


Robot reporter 'to write news in future'

"...within a few years this newspaper could be written not by human journalists but by a piece of software trained to pluck text off the news wires and rearrange the words into punchy stories. "

"The scientists told the American Association of Artificial Intelligence last week that the program [me: named "Author," i.e., the software being discussed here] could be married to systems that are already capable of extracting information from text.

This, they claim, would make it possible for Author to scan news wires or government papers for the bare bones of a story."

and lastly:

"Journalists need not start worrying about their jobs just yet. The developers said that Author still lacks one fundamental skill: the ability to tell fact from fiction."

me: seems like this would make it a perfect candidate to start today...

G$Observations of an amateur chartist#5926008/09/01; 09:45:44

Listening to some yo-ho on CNBC talking about a bottoming economy, and how we should get fully invested now in stocks. I have to question the logic in this. I started trading the junior resource market in 1996, when it went into its parabolic run to the sky. I saw a lot of people make money, but I saw more lose in the end. As that market came down there were many times that people said that the bottom is in and there is little downside risk, only to watch the market careen lower to what a year or two earlier would have seemed obscene levels. And it's still not over today. Most companies switched to a dot-com venture and were blown out of the water in the tech wreck.

Now I realize that I am comparing apples and oranges when I compare the chart of the Nasdaq to the VSE run of 96, but I believe there is a common thread. A chart ultimately measures human emotions, and when a market goes through parabola, this is usually indicative of a massive misallocation of that takes longer, and with more pain than anyone thinks possible to work out.

Most participants that I knew lost their play or 'mad' money in 1996-7. Sure some lost their fortunes, but I would say that was not the rule. The problem with the Nasdaq bubble is that people lost their 'serious' capital. The capital that takes years, even a lifetime to acquire. That money is living in money heaven and it isn't coming back any time soon. People whom a year or two before would never have dreamed of buying a stock with a PE of 350, or even 35 for that matter were gobbling up the Nasdaq leaders with absolute abandon. Just like people lost their love of resource stocks after the bubble burst on the VSE, I think it will be a long time before people return the broader market with mass conviction. And if this is the case, we are a long way of from a bottom in the Nasdaq.

CoBra(too)@ Miner 49er#5926108/09/01; 09:48:44

Great Story - or "turn" fact to fiction, which may even come closer to today's mainstream media spin bias.

... good to see you around - best cb2

dlewisA Polemic on the New Productivity Paradigm#5926208/09/01; 10:00:44

Just some food for thought.

Using Greenspan's words, the essay linked here takes a look back at the productivity miracle as it unfolded within the framework of Thomas Kuhn's "Struture of Scientific Revolutions".

ShermagMiner, Argentine bonds for taxes#5926308/09/01; 10:02:22

First, a question comes to mind that the article did not address: At what value will the bonds be accepted, at book value or market value? There is a large difference at this time.

Now my comment. This is a positive in that it reduces the need for cash, and retires some government debt, although it seems to me to be only a mild improvement. I would expect that most bonds would be either tied up in pension funds or held by parties not owing significant taxes. As such, there seems to be an effort to spin something more out of this than is justified.


dlewisA Polemic on the New Productivity Paradigm#5926408/09/01; 10:02:56

Just some food for thought.

Using Greenspan's words, the essay linked here takes a look back at the productivity miracle as it unfolded within the framework of Thomas Kuhn's "Struture of Scientific Revolutions".

BR549Points to Ponder#5926508/09/01; 10:15:16

I notice that silver is up a penny and gold is up $2.70 this morning. In this case, I'll have the gold. I know what you are speaking of is in the longer term and I think you are assuming market prices being based upon unfettered supply & demand. I own both physical gold and physical silver. I prefer the gold but am greedy enough to accumulate more silver in a heartbeat if I felt that its appreciation would be at a higher percentage rate.

If the assumption that gold production costs are underwater to current market price, then indeed supply should become a factor in the future as factors of production and mines fail. Forward selling cannot save them.

If you take gold's natural price fluctuations out and focus on factors such as the Fed "lending" stored reserves to bullion banks, these banks in turn leasing their physical supplies, buyers contracting to replace this physical at a later date then defaulting, and the Fed reclassifying its definition of storage (deep storage gold), then you have a different picture of actual gold supply. The Treasury numbers of 8,167 tonnes of stored gold have not fluctuated while all of this has been going on. The 1995 minutes of the FOMC brought some interesting questions to mind. Fed minutes of FOMC meetings are on a five year lag and The Freedom of Information Act does not pertain to their censored transcripts so we don't have a clue of what is going on now. IMHO FOMC meetings need to be broadcast live, but that is a different topic.

By the way, I like your other rules for investing also but unfortunately, I don't get involved with the equity market. I am proud to say I didn't lose a dime in my 401K this year. But I didn't make much money in PM's either. Of course, given there is "no inflation", (opportunity capital gains aside) I didn't lose any money in the "duck" either. (Ha!).

If the wheels fall off of the economy, would you prefer silver over gold for barter? And once again, do you factor in manipulation into you decisions such as what the Hunt's tried to do many years ago and what the Fed denies they are doing now?

Regards from Cornfield County.

site stewardminer49er, thanks for the link. This is classic!#5926608/09/01; 10:16:48

BUENOS AIRES, Argentina, Aug 8 (Reuters) - Argentine shares closed higher for the second consecutive session on Wednesday, rising 3.88 percent in heavy volume on investor optimism after Economy Minister Domingo Cavallo's announcement late Tuesday that bonds could be used to pay taxes --------

This evolution of a new usage value for a financial instrument may stem future selling pressure by the locals, and keeps the game a lively one.

Comments for all:

Similar to U.S. history where our gold contracts (which is what dollars 'technically' were prior to 1971) fell out of confidence which led to a redemption run and ultimately, default. The dollar game, no longer technically a gold contract, was kept lively because the fallback usage for these contracts was in the function as money -- for paying taxes or general commerce.

Now, here's the million dollar question (which has been posed here before): What usage value will modern-day gold contracts and derivatives have to fall back on if they again fall into a confidence crisis/run/default?

Put another way, what meaningful authority will step forward offering to accept payment with gold derivatives that have lost all prospects of physical attachment? This is how, in a time of stress for the gold market, there could be a selloff of derivative positions (where current price discovery occurs a la the NY COMEX) thereby driving the quoted prices down even as physical tightness drives up to ever higher levels the premium (and total price) on metal for delivery.

Cavan Mansite steward#5926708/09/01; 10:24:45

That's the spirit!
Gold Trail UpdateThe Gold Trail Discussion has been Updated#5926808/09/01; 10:27:20">The Gold Trail Discussion has been updated. Click on the link to read the latest updates.
G$(No Subject)#5926908/09/01; 10:30:39

Gold up $4.5...dollar index down a full point. Gotta love that action.
Max RabbitzTime for a little Rare Swedish Gold#5927008/09/01; 10:36:17

Clink Clink
LeighTrail Guide#5927108/09/01; 10:38:36

Trail Guide, after reading this latest Trail Message...I think I'd rather buy gold than re-roof the house!
Gold Trail UpdateThe Gold Trail Discussion has been Updated#5927208/09/01; 10:39:27">The Gold Trail Discussion has been updated. Click on the link to read the latest updates.
Canuck@ Cavan Man#5927308/09/01; 10:47:57

"...taverns and chasing skirts...". You dog!!

Yes, 10 or 15 years ago this seemed to be the correct
'investment'! Now my eyes are the only part that still chases....until the wife interjects with the old 'staring' monologue.

Now I'm older and wiser(?).

Nice hop to the POG dog today, hope it sticks. I am proud to say I am in the 'correct camp' today.

Good luck with the 'skirts' and your investments C.M.


site stewardWhile funds market trades at FOMC target, Fed adds reserves#5927408/09/01; 10:51:08

Following yesterday's permanent add of $2.13 billion through the outright purchase of Treasury bills, the Fed today replaced yesterday's temporary $4.245 billion add (overnight repos) with yet another, larger round of overnight RPs. Today's value was $5.85 billion. This came on top of yet another $2 billion added earlier this morning via 28-day repurchase agreeements.

Elsewhere as relates more directly to gold, Reuters reported: ----COMEX gold enjoyed early speculator interest Thursday, rising to its loftiest price in nearly three weeks as the euro advanced to a 12-week high, making dollar-priced precious metals cheaper for Europeans. ... Europe's single currency rose to $0.8877, its highest since May 17, as the U.S. greenback sulked after Wednesday's Beige Book survey from the U.S. Federal Reserve, which provided little reason for optimism about a fast turnaround in the moribund U.S. economy.-----

Are our European friends prepared to seize this opportunity of bargain shopping to bolster their gold portfolios? For surely, when gold's value corrects in accordance to its physical supply/demand fundamentals, its price shall rise significantly in terms of ALL currencies, though more in some (dollar) than in others. Buy cheap, buy now.

Today, among others, is a good day to buy gold. Give Centennial a call, toll free. The office is open.

Gandalf the WhiteThe FOG is lifting with your clear "writings"#5927508/09/01; 11:01:31

FOA (08/09/01; 10:27:19MT - msg#93)
"everything to do with a gold bull market"
Thank you again for the "corrections" of the Media slants.
Thinking about what is said is difficult for most Sheeple.
The Hobbits all "favor" their one ounce 0.9999 INSURANCE piece.

Tommy PMore news from GATA#5927608/09/01; 11:03:00

From: GATAComm@a...
Date: Thu Aug 9, 2001 1:52 pm
Subject: More GATA gains on the publicity front; Murphy on radio show today

Thursday, August 9, 2001

Dear Friend of GATA and Gold:

As a result of the latest GATA Business Wire press
release, I had lunch today with one of the most
impressive reporters I have ever encountered. It so
happens that he works for one of the most prestigious
and financially connected organizations in the world.

And, in perhaps in in one of the most wonderful of
coincidences, he is a friend of Adam Aljewicz of
Dow Jones Newswires, who has done two stories
on GATA out of Johannesburg, South Africa.

Adam was most impressive at the GATA African Gold
Summit in Durban, South Africa, on May 10, 2001. He,
Reg Howe, and I and others, such as James Turk, had
the opportunity to discuss much over dinner.

What will come out of this lunch, who knows? But it is
obvious that GATA's "enveloping horn" strategy is

Meanwhile, I feel most privileged to be a guest today
on the Stan Solomon Show, "positively pro-life, pro-liberty,
anti-globalist, and for the people, RIGHT from the heart
of America." Stan serves up important topics for discussion,
rapid-fire commentary pulling no punches, and an array of
intriguing and informative guests. Stan keeps a large and
loyal audience coming back for more.

The show airs Monday-Friday from 3-6 p.m. Central
Time on WPZZ 95.9FM, NewzzTalk96, in Indianapolis,
Indiana. If you can't pick up the radio signal, you can
listen to the show online at

(Time zone guide: 3-6 p.m. central is 4-7 p.m. eastern,
2-5 p.m. mountain, and 1-4 p.m. Pacific.)

Gold Anti-Trust Action Committee Inc.

escapethematrixThe start of a new trend??#5927708/09/01; 11:10:47

Gold- up 5.20

Euro up through .89

Dollar- down 1.05

Things seem to be heating up....
Thanks for the hike TG...
Excellent thoughts as usual...

CoBra(too)Another nice Snippet on the SM's#5927808/09/01; 11:27:03

dug out by the Daily Reckoning Team:

"Broken promises, unfulfilled expectations," writes Mark Rostenko, editor of the Sovereign Strategist. "Rate cuts don't work, earnings ain't getting better, the Fed is still full of crap and propoganda, why [would anyone] buy?"

"In 1929 the S&P 500 peaked at 21 times earnings," points out Mr. Grantham. "In 1965 it peaked at 21 times. Not so long ago it peaked at 33, and is now somewhere around 26...

"[Does anyone] really think," he continues, "we're on the edge of the next bull market when the p/e of the S&P is still higher than its pre-'29 crash?"

Meanwhile the US$ takes a beating and POG has the best spike since May - Times a'changing, true? cb2

site stewardShermag asks about Argentine bonds for taxes#5927908/09/01; 11:42:16

"At what value will the bonds be accepted, at book value or market value?"

Great question. Working with the few details we've been given, let's think this through. I'll offer some points that come immediately to mind.

If bonds are accepted at market value, nothing is really gained in the eyes of the bond holder except that he or she avoids the normal (extra) step of selling the bond in exchange for the cash needed for tax payments. However, in a larger market sense, this may provide a marginal support for the bond prices as many are "redeemed" directly without giving the sellers added weight to outdo the buyers participating on the bond market.

Also in a larger sense, this use of bonds for payment strikes me as inflationary -- an increase to the "effective money" supply. (Apart from this scheme, bond holders needing tax payment money would first need to track down a buyer in order acquire, then use, his "conventional" money from within the conventional supply.)

Looking beyond, if a confidence crisis is at hand....

A perception of rising inflation rates raises the issue of exposure to interest rate risk for all bond holders. That is, as perceptions of future currency devaluations prevail, the bond holders become less willing to hold a bond over term unless compensated for the devaluing currency with higher interest rates -- yield -- on the bond upon its maturity. It is very real that the market value on a particular bond could fall from day to day (even as it draws nearer to maturity) simply because the marketplace feels the money will lose value faster than was their perception yesterday or the day before.

In such a scenario, to maintain confidence in the bonds by eliminating this degree of interest rate risk, it wouldn't be too surprising to see the government agree to accept their bonds prematurely as payment but at the full face value. Naturally, such a plan would be an emergency measure, and would likely be restricted to short-term and near-dated bonds only.

I hope this has been good food for thought to simply stimulate your own good thoughts and further consideration.


HoratioGold is Currency#5928008/09/01; 11:47:14

I just saw on the tele on a financial news channel a statement "Gold is Currency"!"Its following the Euro".
This revelation is being discovered by the news media and reported as if they were the first to discover it.
I'll give them some credit ,in fact I don't care who takes credit ,just as Pres. Reagan said "you can get a lot accomplished when you don't worry about who gets the credit".
This is a major turnabout from the people that have been espousing the mantra that its only a commodity.They have known that to be a lie all along and now they have a purpose for thier new position.I wonder what that could be?

MarkeTalkGold and the Middle East #5928108/09/01; 11:54:23

Today's news events are proving how important cycle turning points can be. August 6-7th was forecast to be a top in stocks and a secondary top in the U.S. Dollar. Who would have known that a suicide bomber would succeed in killing many people in Jerusalem this morning? There have been dozens of attempts but the Israeli police and army have intercepted the perpetrators--until today. The point I am trying to make is that things happen for a reason and they happen around cyclical events. In reaction, gold is up $5.50 per ounce and has now broken out above its resistance level. Next target is $290-295.

I believe that gold and oil prices will react when (not if) Israel retaliates for today's suicide bombing. Ariel Sharon made it clear after the disco bombing of one month ago that he would "take off the gloves" and go after these Palestinian terrorists, risking 200 Israeli soldiers in the process. You can imagine how many Palestinians will be killed if 200 Israeli soldiers are sacrificed. It's going to get ugly. You can stay in touch with events in Israel each day with David Dolan's website, which I have found to be one of the best and most concise websites on the Middle East situation.

miner49ersite steward #59266, Shermag #59263 re: #59249#5928208/09/01; 12:59:29

Thank you gentlemen, for your input.

Shermag: ----------------------------

First, it seems that what you focus on indeed will be the part for public consumption. Pro-gov. media will emphasize certain benefits to be had (at least in concept) from the perspective of the typically finance/economics uninitiated public. Since such a relatively small amount of these securities actually reside in the individual hands of "parties not owing significant taxes," and a large part are likely in tax-deferred, tax-favored, or non-taxed funds/institutions, this could probably be just a catalyst for a good spin. Of course, if the scheme works (that is entices the big-fish holders of these instruments and their derivatives, to bid their price up), then whatever redemption takes place in lieu of cash for tax payments, means the payer relieves himself of his onerous obligation at a significant discount by using these now artificially high-valued bonds.

To circumambulate to the other side of this now..., that means the government ends up paying too much for its borrowing anyway, still has too much day at the end of the money -- still having to meet its obligations, and undoubtedly ends up increasing taxes, along with various devaluation techniques, thus cancelling out the advantage originally derived by the taxpayer.

Thus, it seems to me (and this is with my very-untrained, still groggy/foggy mind -- even though I've had two really superb cups of coffee now...) that this is another deal that attempts only to bail out traders by putting another "meaningful authority" out there who will obligate itself to accepting these instruments. This helps stem the out-of-control momentum of crashing derivative trades, and the imminent onset of the grand, to-be-feared "discontinuous event" (for the time being anyway...), but does little more than postpone the day-of-reckoning for the Argentine government, and nothing for the majority of Argentinians except put more burden on them.

Second, good point -- market or book -- it obviously will make a difference in the cost to Argentina, and the perception of value to the traders, but I think the main goal in this plan is simply to bring convergence back to spreads, and reduce the perceived risk of default in the mind of the financing world. Do you see more here? I'm not the expert by any stretch, I just try to get in on the discussion and hopefully grow from it...

There are undoubtedly larger holders of these instruments who are obligated to taxation by the Argentine government. This would make a difference obviously to them, but again, if the premise for this plan is to keep the world from a market "happening" more than a genuine plan to improve Argentina, then we should look to what it does to benefit world markets, more than what it does for Argentina.

Indeed there may be more in this than the spin makes apparent...

Randy: ----------------------------

I was going to say how unfortunate it was that you decided to rein in your commentary, and hoped that with a significant number of like-stated regrets, you would change your mind. Thankful I am that a little link has stirred the juices. Please keep it coming! Your input is exceedingly valuable to the forum. Untold creative thinking is inspired thereby, even if we don't post in response. The perspective is most welcomed and excellent.

I wish I had the time to focus on issues like this (as if time makes up for lack of knowledge), as it appears that a lot might be inferred by this action. First, Argentina, having been in close contact with US advisors, and then taking this action, tells me that there is certainly some US blessing on it. Therefore, it might be inferred that some shape-changed version of this may appear in our near future.

To pick up from above, it seems that the concerns of the world finance markets are foremost in the thinking behind this plan. Another advantage, perhaps to a scheme like this, is that unlike announcing a buy-back, tax payment is not always done at any particular time. A buy-back date does nothing but invite volatility (specs bidding up to the event, and dumping after), which invites further unprogrammed stress to derivative models, and costs Argentina more as well. Assuming they have a tax date, or dates like everyone else, there would be increased action at these times, but entities probably are always paying taxes of varying kinds.

Thus these exchanges would not all take place on any trumpeted date. This would, while still providing a reason to bid them up (new usage value), keep a bit of a lid on it by removing a potential peg; maybe even smooth things out a bit. Sort of keeps the game lively, as you say, but also keeps 'em guessing. Just a thought...

Given the scanty info we have about this deal, all this is mostly academic. But frankly, I love the discussion...

The $1,000,000 question you say that you've posited previously: "What usage value will modern-day gold contracts and derivatives have to fall back on if they again fall into a confidence crisis/run/default?"

Gold contracts to pay taxes...? Heck, why not...

Best regards,

Also, CB2 - indeed you are right -- "turn" fits better...;-)

auspecCavan Man And Canuck#5928308/09/01; 13:37:24

Saw you guys discussing the concept of standard "portfolio allocation wisdom" and thought you might enjoy the following excerpts out of Robert Kiyosaki's "Rich Dad Poor Dad":

".....playing it safe and going 'balanced' on your investment portfolio is not the way successful investors play the game. If you have little money and you want to be rich, you must first be 'focused' not 'balanced'. If you look at anyone successful, at the start they were not balanced. Balanced people go nowhere. They stay in one spot. To make progress you must first go unbalanced."
"Thomas Edison was not balanced. He was focused. Bill Gates was not balanced. He was focused. George Soros isfocused. Donald Trump is focused. George Patton did not take his tanks wide. He focused them and blew through the weak spots in the German line."
"If you have a desire of being rich, you must focus. Put a lot of your eggs in a few baskets. Do not do what most people do: put their few eggs in many baskets." END

This is a great book and has changed my viewpoint entirely as it relates to career advice for my college age sons. Most of us around here are pretty 'focused', no?

NetkingMarkeTalk#5928408/09/01; 13:55:22

MarkeTalk, I have read your posts with interest, they are the view of someone who's informed. Thanks - Netking
andrus sommerselgSilver and Gold#5928508/09/01; 14:04:00

Greetings to all,
Lately there was a lot of talk concerning silver which I have largely enjoyed. While I have found the silver 'crash alert' story amusing, the rest of fact based accounts were educational. I do own silver and gold as well and care not if they temporarily appear 'cheap'. It is all about perceptions and the abnormal valuations of our time. Things change, don't they?
Concerning the availability of silver bars; I have ordered 3x100oz bars in early spring and the fairly major supply company could only fill the delivery as 2x100oz and 2x50oz. The 50oz bars carry larger premium than the 100oz, yet I was apologized to and charged the 100oz bar price for both 50oz. (I do not know if this is normal. I assume after taking my order they have realized they are out. Lately I am into coins.) It was my first order after discovering the writings of Ted Butler. Also, I assume I am not the only one ordering after reading Butler. Every time I read his bits on silver I feel I need more and thus order more.
Today is a good day for gold. Though, when it moves I get the cold sweat and shakes. I fear what is coming, despite being loaded up on silver, gold and unhedged gold stocks. I wish no harm to others, yet ANOTHER is by all means right about what is coming. "Paper will burn." Well, it was always burning. Wasn't it? I am doing my best to spread his words, but people do not listen and at times I feel like I am a lunatic. I want to thank all the posters of this board and especially the host for the great posts. This site has become an oasis. My kind of place in a desert of "irrational exuberance".
Thanks and exuse for my rumbling.

NetkingIsrael Prepares Massive Blow Against Palestinians#5928608/09/01; 14:11:09,2933,31209,00.html


Rather than tolerate the continuation of random, spontaneous violence, the Sharon strategy will be to silence them entirely. It will require a massive military blow against the Palestinian political infrastructure. It will involve the decapitation of the Palestinian leadership and the exile or deaths of the political elite. Weapons caches will be sought and destroyed, communications facilities ruined. From Israel's standpoint, the Palestinian community must be isolated and controlled.

There is also a chance that Israel may apply this strategy to two other long-standing problems: the Syrian control of Lebanon and the potential Iraqi military threat against Israel . . . . watch this space

Cavan Manauspec#5928708/09/01; 14:12:19

I have read the book twice and have a copy on my desk. I met "the Stranger" awhile back and his advice was quite similar. BTW, "the Stranger" is much smarter than the average bear (eh boo boo?).
Cavan ManLeigh#5928808/09/01; 14:14:16

"Now is the time to stretch." Mike Kosares

I heartily concur and have done likewise. It's like buying your first home; always stretch and buy more than you think you can actually afford. Note; I said "first home".

Belgian@ Saxulum#5928908/09/01; 14:14:53

Dag beste buur. Thanks for the info. I'll consider it while on leave for 14 days of contemplation in plain nature.
Gone miss this Gold-University here. (Doei)

Cavan ManCanuck#5929008/09/01; 14:15:51

Didn't mean to convey the wrong impression to you. I simply believe in owning up to past misdeeds. I repent anew each day. Kind regards.....CM
CoBra(too)@Re Auspec's Focus - re: Cm and Canuck - #5929108/09/01; 14:21:45

As Gerald Loeb has put in his (in-)famous book of the late 60's "The Battle for Investment Survival": " Put all your eggs in one basket ... and focus on the basket".

Seems to serve as an answer to the eternal question of the chicken and egg as well - the basket came first ;>) -

Oh, hell, I'd better sign off ... . . . . . zzz bbb zooo...

auspecBelgian#5929208/09/01; 14:45:14

Enjoy your introspective time. You may want to take a few coins with just in case you become forlorn.
A real basket case

CoBra(too)@ Belgian - #5929308/09/01; 15:03:26

Het hat niet, leve jong, you cant just leave for two weeks and enjoy nature - there's lots of work for you to do!

... Though, as a second thought, you might have earned your leave and thank you for all your input - and BTW, I'm living in the country and enjoy gardening every day - great tomatos, cucumbers, Zucchinis - string beans this year ... and have a great vacation.

POG will hopefully appreciate your efforts too - cb2

site stewardauspec and "eggs"#5929408/09/01; 15:19:46

Excerpted from your source: "If you have a desire of being rich, you must focus. Put a lot of your eggs in a few baskets."

Unfortunately, a seemingly important element is absent from this guidance: one of TIMING.

It should be stated that for those seeking the greatest success, the time of focus should PRECEDE the placement of eggs into specific baskets. That is to say, a person should focus on his or her choice of baskets moreso than focus after-the-fact upon the following dismal results of random, unfocused choices (baskets).

Go for the gold.

site stewardWelcome to andrus sommerselg#5929508/09/01; 15:28:36

Thank you for joining us in discussion.

You might be pleased to know that MK and his staff has good connections and can generally obtain any of the standard precious metal products for delivery to three continents (North America, Europe, and Australia).

Please feel welcome to call Centennial toll free for product availability and prices. And of course, feel even more free to continue sharing your thoughts on silver, gold, and paper.

SteveHRepost#5929608/09/01; 15:35:39

This is a repost:

Date: Thu Aug 09 2001 17:20
Captain_Kirk (Some Common Misconceptions Clarified) ID#342221:
Copyright © 2000 Captain_Kirk/Kitco Inc. All rights reserved

Misconception number 1 ) . The United States was on a "Bi-metalic Standard" from 1794 through 1933.

Incorrect. The US dollar was a coin of silver containing 371.25 grains of silver. The US Congress of 1794 established a mint, measured the silver content by weight of the commonly used Spanish Milled "dollar", the "Pieces of Eight", and minted US dollars having the same weight of silver as these existing "dollars" that were in common usage at the time of the formation of the United States of America. There was no new "dollar", only a new stamp on an existing commonly used silver coin. Old dollar debts could be paid in newly coined coins with no "new" versus "old" dollar conversion problems. This silver coin, this US dollar was minted for the next 140 years up until 1935. Between the years of 1787 and 1935, a contracted debt of dollars was a debt to deliver a certain weight of silver, such that the weight in grains ( 480 grains to the troy ounce ) was calculated by multiplying the number of dollars owed by 371.25 grains. Foreign coins of silver could be used to pay a dollar debt of dollars because a debt of dollars was a debt of silver and the "exchange rate" was a simple calculation based on the weight of silver contained in the foreign coin.

In the late 1700s, due to the existing conditions of world trade, the silver price of gold stayed fairly constant over a long period of time. The silver price of gold was just simply the silver/gold exchange ratio, which was 15/1 up through the mid 1840s. A silver/gold exchange ratio meant that the markets were exchanging 15 unit weights of silver for 1 unit weight of gold. Since the silver/gold exchange ratio remained fairly constant in world trade markets, then coins of gold were minted that had their dollar ( silver dollar ) value stamped on them. For example a 20 dollar gold piece had 495 grains of gold in the coin, and this weight of gold was calculated from the following formula, 20 times ( 371.25 / 15 ) grains ( 1 fifteenth of 371.25 grains is equal to 24.75 grains, so 24.75 grains gold would exchange for a silver dollar which was 371.25 grains silver ) . The word "US dollar" means 371.25 grains weight of silver.

The "Bi-metalic Standard" was a euphemistic term that referred to the political efforts of certain silver factions of the late 1800's that tried to artificially "fix" the silver/gold exchange ratio within the political borders of the United States. This was a simple market protectionism of US holders of silver debt, which included the US government. In the late 1800's, in world markets, silver was "de-valued" against gold or became unstable such that the silver price of gold was increasing or fluctuating. As the unit of account in the US was the silver price of goods, then gold savers saw their savings "appreciate" in that they could buy more market goods ( over time ) for the same amount of gold. So if one had a 20 dollar gold piece, then he would not want to use this 20 dollar gold piece to purchase 20 silver dollars worth of goods because his 20 dollar gold piece was worth more than 20 silver dollars.

Generally, during the late 1800's and early 1900's the silver/gold exchange ratio became unstable with silver gradually depreciating against gold on the world markets such that gold gradually became a more stable unit of account than silver. This meant that producers would want to secure contracts for the exchange of gold for goods instead of the exchange of silver for goods. But in law and contracts there could never be a "Bi-metalic Standard". There was no lawful way to compel a debtor of silver to deliver gold in payment of the debt. Even with the widespread use of banknotes, the gold or silver certificates, the creditor could always demand "specie", which was actual gold of silver coin, in payment of debt.

The US Constitution requirement that "no state shall make any thing but gold or silver coin a tender for payment of debt" was in essence a strict unalterable ( except by Constitutional amendment ) requirement that no state could require taxes in anything but gold or silver coin. And the state had no power to alter or interfere with the creation and fulfillment of private contracts. Notice how people are asked to or supposedly required to sign something whenever they pay taxes in something other than silver or gold coin. This is a simple subterfuge to get a "form of a contract" from the "tax payer" so that the taxing entity can pretend that the "tax payer" is agreeing to a private contract. Really, if one pays a debt, then the creditor should tender a signed receipt, and the one paying the debt would be under no obligation to sign anything, would he? It would not be an outlandish statement to say that the entire Federal Reserve System monetary system is based almost entirely on the ignorance and outright stupidity of the people using the system. The Federal Reserve System ( FRS ) is simply a private trade association. All one has to do is to cancel their FRS membership, and any FRS trade number "debt" they supposedly "owe" will disappear like so much smoke.

Misconception number 2 ) . The United States was on a "Gold Standard" from 1933 to 1973

This is a misconception of terminology. During the time period of 1933 to 1964, the United States of America as formed under the Constitution of 1787 ceased to exist. First, the Constitutionally defined states ceased to exist as there was no state that allowed payment of taxes exclusively in gold or silver coin. Even though states allowed payment of taxes in silver coin, they gave preferential tax abatements to members of the Federal Reserve System ( FRS ) private trade association by allowing these members to pay taxes in FRS trade numbers. These "states", in name only, paid their silver dollar debts using FRS trade numbers using the scam that FRS silver certificates, issued up until 1964, could be "redeemed" for silver dollars, albeit on a very limited basis. But the US mint minted no silver dollars after 1935 and minted only silver change coins up until 1964, therefore the silver money supply was taken out of circulation. So by 1964, due to the unlawful Roosevelt US gold embargo of 1933 that removed gold from circulation as money, both silver and gold were effectively embargoed from circulation as money. So by 1965 the United States of America, as formed under the Constitution of 1787, ceased to exist forever.

The so-called "Gold Standard" often referred to today, is really talking about the "Bretton Woods Agreement" of 1944 through 1971 which was scam used by the FRS to get foreign countries to adopt complementary FRS trade numbers type "money" systems. The US/FED became the gold depository for the member countries of this Bretton Woods Agreement, the other members would take FRS trade numbers on deposit as reserve "currencies", and the member countries could exchange their "reserve" FRS trade numbers" with US/FED held gold at a specified rate of exchange. Nixon's default of the Bretton Woods Agreement in 1971 instituted the so-called "floating currency" scheme, which was nothing more than the imposition of the world wide officialized trade numbers’ associations and pacts. The so-called "Gold Standard" is nothing more than a euphemism for the "Bretton Woods Agreement".

Misconception number 3 ) . Since there is no United States of America today, there is no law.

Wrong. English and American Common Law as formed in concept and practice over the 700 years between the approximate dates of 1200 AD to 1900 AD will always exist, as long as there are people who have knowledge of and who wish to follow this Law. This Common Law needs no nation state, official court, or association of lawyers as this Law is a law of the people. Private contracts, private property, free trade of private property, free association, and free ownership of the fruits of one's own labor, are all recognized concepts and practices of this Common Law.

site stewardAnswer for Cavan Man on the Eurosystem "selloff" of EUR 400 million in foreign currency#5929708/09/01; 15:42:18

In resonse to yesterday's report on the international reserves of the Eurosystem, you asked me: ----"Where do you suppose the EUR 400mm went? How are these sorts of transactions effected?"------

The decline in the net position in foreign currency held in account by the ECB and 12 EMU member CBs would be the combined effect of transactions by their customers and of portfolio adjustments for whatever reason. Getting rid of overvalued dollars while the "getting" is good, perhaps? That would be my motivation as an international customer within the eurosystem -- draining my dollar account to be exchanged for personal gold holdings.

Thanks for reading along. (ho hum)?

AbsoluteXNasdaq MUST Crash ANOTHER 83%#5929808/09/01; 16:03:31

Mark my words:
If you own stocks or equity funds in 2001 - 2002, you're going to get clobbered!

President Bush and Fed Chief Greenspan would LOVE to come to the rescue
- but they CAN'T!

Alan Greenspan's interest rate cuts can't even BEGIN to stop the coming crash - and he knows it!

Every Fed Chairman in history tried to prevent past recessions by lowering interest rates; and every one of them failed miserably.

NetkingMiddle East - Snippits . . . . #5929908/09/01; 16:24:01

Does the M/East have much to do with PM's, believe it! As McAgspec implied the PPT would find it hard to control a war, heck these guys struggle with the paper trade at times! I note 'elsewhere' that Len Kaplan's reasoning for a Au spike based on the bomb was rubbished, I think he was right on(IMO). I'm 40 with my oldest girl soon to go to high school, wonder how the world will look when she's my age . . . anyway I digress, a few things that may be of interest: . . .
Informed Dave Dolan say's(writing from Israel)"Today's attacks could be the trigger for the postponed major army operation. Or it might be that Sharon decides that the time is not ripe for such action. But some sort of serious response can be expected in the very near future (the security cabinet is currently scheduled to meet early this evening to discuss today's attack). . . it definitely looks like Sharon and Peres will now be forced to bite the bullet and do the job themselves, whatever the local or regional consequences. . ."
Islamic Jihad claims responsibility - Israel calls emergy cabinet meeting
The same man who telephoned AFP in Amman to claim the Thursday suicide bombing there on behalf of Islamic Jihad called again to say its forces would carry out similar attacks elsewhere in "Palestine," including Tel Aviv.

"Operations will be started again on other Palestinian cities, notably Tel Aviv, in the same manner," said the caller after at least 17 people were killed and more than 80 injured in the blast at a crowded pizzeria in central west Jerusalem.
Cabinet minister: "This time we WILL respond"
Muslim Brotherhood to Arab nations: "Wage holy war"
- Netking

R PowellGold or Silver??#5930008/09/01; 17:05:33

There was much talk today about whether one should buy gold or silver. Why? Why not just buy both if that's affordable? I'm presently forced by finances (or the lack of) to hold only silver as a physical holding. To wonder which one to buy implies that the choice exists. If so, why not both? CPM sells both.
Concerning digital photography's potential to remove silver demand from that market. The latest numbers I've seen show no slowdown in silver use in photography. How many of the world's population can afford a very expensive digital camera and the $1000 computer that's also needed to produce pictures? How much does a cheap camera cost?
From Don McAlvany, "Photographic demand in 1999 jumped 3.9% over 1998 and is forecast to grow by 4.5% in 2000 over 1999." This is from the link above. Hope it still works.
Rich (in the to da moon group)

ZenideaWheres the emotional Abacus ?#5930108/09/01; 17:39:36

Hi all. Just on a personal nano level I notice that some banks are beginning to inundate me with special offers like transfer X balance over to Y and pay 4% for 6 months fixed instead of the usual 16-17%. I notice that these are Visa offers and not Mastercard ones. A Bank phoned me on Sunday night believe it or not with a gentleman apologiseing for the time/day (Hungry for business?) and further commented when I commented on this that Mastercard is American and Visa is European. ( Is that right ?).

This week there has been (somewhat suddenly ) several hundred lay offs in nickel and I know large numbers of workers in line for the chop in alumina. Cut backs in Aussie.

Now I see Gold hop and the US dollar tank, oops euro strengthen. Immm getting lured by the trail. Might just rest golden eggs in a silver basket from here on in and sit.

NetkingM/East (cont.) - Hal Lindsey #5930208/09/01; 17:50:58

Remember Hal Lindsey? . . .author of best seller "The late great planet earth", a book that impacted me & others back in the 70's. Hal comments on the current situation in the above link.
"A war of the magnitude that is developing there will especially have profound effects on the oil driven economies of the West. In the most extreme scenario, the coming war could force the U.S. military to get involved directly . . . weapons of mass destruction, which are bristling in the inventories of all the potential combatants, could cause an appalling loss of life and render some of the oil-rich Middle East regions ininhabitable for decades. . .

"According to the most recent Israeli intelligence assessments, a regional war is a foregone conclusion by 2002. Personally, I think that is an overly optimistic time schedule . . ."

The following review of recent developments shows that a war may be only a matter of days or weeks ahead. The events themselves are taking on a life of their own that leads down an all too familiar path that ends in war – and this time, a war of cataclysmic scope . . . "

site stewardFor Zenidea -- Visa and MasterCard#5930308/09/01; 17:51:22

From your post: ---"I commented on this that Mastercard is American and Visa is European. ( Is that right ?)."---

Visa came about through a name change in 1977 from what was formerly the BankAmericard, an amalgamation of smaller banks that joined with the Bank of America credit card that was launched in 1958 in California.

(MaterCard, by the way, grew out of the 1969 MasterCharge credit card that was the offspring of the City Bank of New York.)

I hope this helps.

Black BladeForbes Body Count#5930408/09/01; 17:56:54

Not on the "Body Count" is that today the GAP announced that 750 would be added to the "Bone Pile." Just a few minutes ago they upped the ante to "over 1000" that will be added to the "Bone Pile." The bodies are piling up so fast that you need wings to keep above the stench of the deteriorating economic landscape. This is not a good sign where layoffs are occurring at a fast pace even as the drones and Pied Pipers plead for investors to remain calm and that they "...see a bottom..." Definitely time to add to the "...PM Pile..."
ZenideaThanks site steward#5930508/09/01; 18:07:22

Well then it appears that the substance of what this gent
said is flawed indeedy :). Ok all thats me; got to visit the land and check the dam. At the moment rain is Gold, be back monday for a lurk.

BR549Classical Commodity Investing vs. PM Investing#5930608/09/01; 18:13:35

The assumption that supply (or lack of) determines future prices may not work anymore for precious metals.

Simplistically, if you are in a futures contract and the weather looks like a drought may occur, then you need to watch corn, soybeans, etc. because supply affects demand and consequently price (or what traders conceive the supply may or may not be).

However, if you have limited resources and must choose between silver and gold, you need to put your limited assets where they will bring you the most return. Remember true hedging is only for those with unlimited resources. Some would argue making the correct investment choice applies to the super rich also.

Yesterday, an investment in gold was right on! I have problems with the argument that PM's fit into commodity classical definitions of supply being used up by production as long as manipulations (derivatives) etc. continue unabated and FOMC notes for their meetings have a five year time lag. Let's see what happens to gold tomorrow if the dollar stabilizes.

Regards from Cornfield County

NetkingRussian gold reserves up by 30.5 per cent since beginning of the year#5930708/09/01; 18:38:20

"Russia's gold and forex reserves have reached a record high, totalling 36,502m dollars as of 1 August, the Central Bank of Russia reported on its web site.

Forex reserves total 32,694m dollars, while the gold reserves amount to 3,807m dollars. The reserves have increased 30.5 per cent since the beginning of the year, from 27,972m dollars to 36,502m dollars."

Maybe we're seeing what Dave Morgan reported(from his site)per below with reference to the expected outwoking of the Russian perception of dollars crash?
"Russia is getting ready for the dollar to crash.

Preparedness measures have moved from the realm of published warnings, to concrete actions, such as the Central Bank's decision to put the gold chervonets coin into circulation. The short-term purpose of that move is to attract Russians' savings out of the dollar, and into the Russian chervonets, in a country where $100 billion or more is held in cash (U.S. Federal Reserve Notes). Beyond that result, the Russian currency shift could become a stepping stone to more profound changes in international monetary policy-as nations seek safety from the disintegration of the Anglo-American-centered world financial system. "The Bank of Russia (Central Bank) acted on July 10, making the gold chervonets legal tender."(from

Cavan ManTowne Crier#5930808/09/01; 18:45:14

I am ho-humming your new sobriquet.
auspecMidas Tonight#5930908/09/01; 19:09:51

"Then today on CNBC, the commentators yapped all day about gold going up because of the weakness of the dollar; showing charts about the relationship, etc. Who set them up with that insight, I wonder?"

"Very strange - all of this - because gold bolted sharply higher in May during and after the GATA African Gold Summit in Durban, South Africa. Yet, the dollar strengthened during that run-up. No explanation was ever given by mainstream analysts for the May gold price rise except some half-baked ones such as "inflation expectations" were on the rise."

"Now, the gold move is tied to dollar weakness with CNBC even calling gold a "currency.""

"What could be going on?"

"The arguments that Dudley gives for a weaker dollar could have been made a year ago. Why do they matter now?"

"I don't have the answers, but what we do know is that GATA is gaining ground in gangbuster fashion. We know that members of Congress are all over Greenspan and O'Neill about GATA's gold issues. I have learned recently that The Gold Cartel is petrified that Reg Howe's Complaint might reach the discovery stage. We now have caught the cabal trying to cover-up what they have done - which is most embarrassing as it provides further evidence of guilt."

"To sum up, the heat has been turned up big time on the bad guys."

"There is also no doubt in my mind (probably yours too) that the manipulation of the gold market was one of the features of the strong dollar policy urged by former Treasury Secretary Robert Rubin. Except for "jawboning" (big deal), how was the heralded strong dollar policy actually implemented? Secretary O'Neill said there was only a minor Japanese currency intervention this past year."

"One way to end the strong dollar policy then would be to end the manipulation of the gold price."

"If the gold rig is on the way out, they are going to need some kind of cover, or excuse, for a coming massive rise in the price of gold. Perhaps, they intend to blame it on the coming fall of the dollar, which is clearly underway. Treasury Secretary O'Neill met with the Goldman Sachs people in London this week. One thing for sure, there is a reason that Goldman Sachs is trumpeting the demise of the dollar. Wish I could get a better handle on what they are up to."

"Anyway you look at it, however, today's developments are constructive for the gold price." END

Comment: How many thousands of people will one day claim they were GATA supporters {like the millions who supposedly saw Hank Aaron break Babe's record}? Be part of history!
Wish we could be in on the decision making process, but must settle for scraps from the table of GS, Rothschilds or other 'socially superior groups' {elitists}. Oh well, soon the entire table will crumble.

Canuck@ Cavan Man#5931008/09/01; 19:27:09

(To 'site steward': this is one of my 'dork' posts, entirely off-topic. I promise to re-focus)


A long story made short.

My outboard on my boat blew up a couple weeks ago and I'm running around looking for parts. Three hours ago I left on my hunt to a marina at some lake in the bush. At the corner of the last gravel road is a woman selling corn. Innocent enough, this corn thing on the side of the road is common enough in these parts, at this time of year. The only thing that struck out was the young woman attending the 'corn-wagon'. My 'eye' is still bang on after 41 years. The young lady, as I approached, was stunningly beautiful and she was .... well...... gifted.

Now my weak point, I began to talk to her. Man, is it hot today or what? (dork statement #1)

"Oh ...this isn't hot"

She has quite the accent so I blurt, " You are from Britain?"

'No, I'm from Australia"

"You're from Australia (genius), you must know Crocodile Dundee!" (dork statement #2)

"No.....I have heard of him, but I don't know him personally"

So the conversation struggled on for a minute or so, I wound up my stupidity and left. Over the couple few minutes
I analysed the poor showing with the stellar, young vixen and decided 2 things:

i) old tired men should not mix(can not mix?) with the young ladies when young, studly males chase them.

ii)it involves obsolute concentration to understand either women or gold. I am presently 'zoned in' on the gold world so therefore I officially relinquish the duty of 'chasing young shirts' to gentlemen of your calibur. This will allow you a chance to catch up!



Solomon Weaver(No Subject)#5931108/09/01; 19:41:36

Something is in the wind

Newmont (NEM) looks really impressive on a 10 day interday chart....I am not a chartist (Hey what ever happened to Mountain Gold??) but since I own NEM and kinda watch it, I get the distinct feeling that something or someone is making them move.....

Now they have HQ in the same town as CPM.....Maybe someone big who was trying to research Newmont landed here instead.

Poor old Solomon

darkhorsePersonal observations, FWIW#5931208/09/01; 19:58:12

Does anybody else notice a bit of an increase in new names around here? Are these casual lurkers (like yours truly) that have been around a while, or is this site gaining a wash of attention lately?

On silver: A few hundred million Chinese running around with disposable cameras aren't going to help the deficit this year, or any time in the forseeable (sp?) future.

Given the history of Israel, does it strike anybody else that they've been VERY restrained in their international affairs since the Gulf War? At the end of the 100 hours, I was taking bets Hussein would have eaten a bullet, gotten into a vehicle with a particular IR "spot" (or other various assorted sundry reasons for it to go "boom") or had a real bad reaction to something he drank (can you say Mossad?)...within six months. I never expected Israel to put up with as much as they have, especially recently.

TPTB seem to control everything, right? So how hard would it be to come up with some sort of "conspiracy theory". These guys are smart people, they see things us schmoes don't...after all, how do you think they got to where they are? So, they see the economic picture getting worse, they've got their fingers stuck in a messy golden pie, and they need a way out. They steer the economics the best they can, and "motivate" some Palestinians. Even if the US military doesn't get involved, whatever happens to POG can easily be pinned to the M/E. It's not like the average guy on the street can put two seemingly separate issues together. I know, it's too simple and too neat, but who says TPTB don't like the KISS method?

megatronBig time trending#5931308/09/01; 20:16:28

Agian, if your interested, take a look at the TSE PM index. It's a far more acurate make-up and is in serious up trend mode. Money like that does not come from Joe and Jane investor.
Black BladeCalifornia officials say Western states neared blackouts#5931408/09/01; 22:21:00


California power managers say 65 million customers in 11 Western states and parts of Canada and Mexico were at risk of blackouts last week when several power suppliers failed to deliver electricity to the region as promised. Gregg Fishman, a spokesman for the California Independent System Operator, said during last Thursday's incident, the balance was so close that the unexpected loss of a single power plant could have triggered the region's worst outage in five years.

Black Blade: In spite of mild weather and energy conservation, it is not enough. We came precariously close to the edge. Given a heat wave, cold snap, or power plant closures for maintenance, we could see more telling cracks in the energy grid. Add growing demand, decaying infrastructure, NIMBY, and lack of fuel, we are facing economic disaster.

Black BladeHeat wave sends electricity prices soaring in East #5931508/09/01; 22:33:04


HOUSTON, Aug. 8 -- Wholesale electricity prices in the day ahead and real time markets in the Northeast soared to triple digits and higher Tuesday because of a heat wave that lingers over the area. New England, New York, and PJM Interconnect are all in the midst of a week-long hot spell sending prices up. In ISO New England standby electricity services were quoted at $1,800/Mw-hr. Prices hit triple digits for energy and ancillary services in PJM Interconnect and in the region served by the New York Independent System Operator. Prices were so high for 10-minute nonspinning reserves and other ancillary services in New England the ISO said Tuesday's bids were under review and "subject to change." At 4 p.m. 10-minute nonspinning reserves hit $1,800/Mw-hr, while 30-mintue operating reserves were $1,000/Mw-hr. PJM issued a warning that reserves are so tight blackouts are a possibility if the system loses the equivalent of its largest operating generator or transmission facility. The amount of power being transferred in the eastern and western parts of PJM was approaching the transfer limit and was already above the "warning level."

Black Blade: When the utility bills arrive, take comfort in knowing that this is not inflationary as it is not calculated in the CPI core-rate. In other words, when those in the east are paying triple the usual rate, AG will give comfort by saying that inflation is benign. That's right - it's just your imagination.

Black BladeElectric storm: Mild summer and US slowdown stave off Californian crisis#593168/9/01; 23:01:16


Nothing about California's electricity crisis is turning out as expected. This was supposed to be the summer of sky-high wholesale prices and non-stop rolling blackouts, but they haven't happened That's mostly because of a fluke of nature: The weather has been uncannily mild and so demand for air-conditioning and refrigeration systems, in particular, has been significantly reduced. It also helps, in a perverse sort of way, that the economy has been slowing down, particularly the energy-guzzling hi-tech sector. Consumption fell by 11 per cent in June, even before a round of retail price increases kicked in on 1 July, and by 5 per cent in July.

That's not all that has gone against expectations. We heard California's governor, Gray Davis, and his supporters, accuse private energy generating suppliers of "gouging" prices; the worst of them, they said, were based in the president's home state of Texas. However, power-buying statistics published last month showed that Texas companies like Enron and Dynergy had, in fact, sold California only 10 per cent of its electricity since the beginning of the year - much less than the Canadians, say - and that the highest spot-rate prices of all had in fact been charged by California-based concerns.

Black Blade: Looks as if we could just get by this summer as we "whistle past the graveyard." Kalifornia has been fortunate to have mild weather and a deepening recession to mediate the power crunch. As long as the economy is in a deepening recession and energy costs remain high, Kalifornians could get by without a more severe energy crisis. Now they must address the decaying energy grid and secure NG fuel supplies for the power generating facilities. This is a good article that illustrates the inherent energy problems throughout the US. Definitely looks like time for adding to PM positions for portfolio insurance.

Note that Kommissar "Red" Davis has been caught in yet another lie about the energy crisis.

Black BladeDiscount Sales Up in July; Malls Empty#593178/9/01; 23:12:20


NEW YORK (Reuters) - U.S. shoppers, strapped by a weakening economy and rising layoffs, again turned to discounters in July as they sought bargains on air conditioners, back-to-school items, personal-care products and food, leaving apparel and department store chains pinched by stunted sales. ``There's still consumer apprehension out there as people are losing jobs,'' Buckingham Research Group retail analyst Daniel Binder said.

Black Blade: It is looking grim out there. The "Bone Pile" grows daily and it does not go unnoticed by the masses. They know that they must save and pay down debt as they too could soon be laid upon the "Bone Pile."

Black BladeThe Demographics of the Slowdown #593188/9/01; 23:24:16


In a bitter reversal of fortune, the wunderkinds of the late 1990s labor market have become the layoff statistics of 2001. Gone is the legion of Internet startups that fueled escalating starting salaries, automatic signing bonuses and the certainty of multiple job offers. However, while casualties among the digital generation are no doubt worsened by the dot com bust, the demographics of this new economy slowdown still look very similar to the old economy variety.

Black Blade: Easy Come - Easy Go. Interesting article and graphs. And the "Bone Pile" grows...

schippiSelect Gold chart#593198/9/01; 23:49:54

Buy signal in progress.
Canuck@ BB#593208/10/01; 04:31:25

Heard last night that the discount stores (ie Costco and Walmart) enjoying higher sales while the high end retailers taking a beating.

Ominous sign of consumer retrenching?

Netking"Scrap the strong dollar rhetoric" - Financial Times#593218/10/01; 05:00:49

FT says: No more strong dollar, US policymakers risk losing credibility if they continue to talk up the currency


The time has come to scrap the strong dollar policy. It made sense when the US economy was booming, because a strong currency helped to suppress inflationary pressures. But in a downturn this approach has outlived its usefulness. It undermines the effectiveness of lower interest rates in stimulating growth by undercutting the competitiveness of US exports.

A strong dollar policy also no longer makes sense because it is unlikely to prove sustainable. The US has a large current account deficit, which has grown sharply in recent years. This imbalance creates a risk. If foreign investors' appetite for dollar-denominated assets were to diminish, the result could be a sharp plunge in the value of the dollar - and subsequent potential havoc in the US bond and equity markets . . .

Black BladeRE: Canuck#593228/10/01; 06:10:06

Check out the link above. Hey, with a whole $300.00 rebate from the IRS I won't be running to Rodeo Drive to do my shopping either. Cheers!

- Black Blade

Hill Billy MitchellCanuck @ # 59320#593238/10/01; 06:38:24

Sir, you said,

"Heard last night that the discount stores (i.e. Costco and Wal-Mart) enjoying higher sales while the high end retailers taking a beating. Ominous sign of consumer retrenching?"



I had an unusual experience last evening, out of town, in the Bootheel of Missouri. A marginal Wal-Mart store, non-super center was in its last day or two of liquidating inventory before closing the doors. Everything in the store was market down first and then sold @ 50% off of the marked down price. I have not seen a Wal-Mart store closed in the last 15 years. This store was located near the intersection of two interstate highways. I would have expected that the inventories to have been transferred to other Wal-Mart stores, or a Wal-Mart distrubution center(re-distribution center - smile). There is a Wal-Mart Super Center just 12 miles west on Interstate 57. There is another Wal-Mart Super Center another 48 miles west which has been historically the best performing super center in the World.

My wife and I are not the super consumer types, however we did spend over two hundred dollars. We find it hard to pass up real durable assets at fire sale prices (lawn furniture already planning to buy – retail $278 (sale price $96) - several bottles of Tums @ half price, nice regulation football for $5.50, etc.

The big surprise: I made my first investment in Wal-Mart(grin). I used a part of my fiat savings to purchase 17 packages of 3-ounce rolls of "BernzOmatic" silver solder. My price was $1.50 per 3-ounce roll. Any one out there know exactly how many troy ounces of pure silver is in a 3-ounce roll of this stuff? It is also nicely packaged for easy storage.

Very respectfully,


Knallgold--------Physical trades above paper!?--------#593248/10/01; 06:52:58

Check GE 7:35 for this post by Tsung_Ming_Houtzu

Am I reading this right?Physical decoupling?

China - Shanghai sets floor on gold-jewelry price, ends price war

The opening of gold-jewelry prices on Aug. 1 had triggered a price war among various gold stores in Shanghai.

Therefore, on Aug. 5, the Shanghai Gem and Jade Association and the Shanghai Gold Ornament Trade Association gathered representatives from various large gold stores and sales agents of famous gold-jewelry brands to discuss the issue of market competition after the loosening of price restrictions.

Currently, the international gold price is fluctuating upward, whereas the designated sales price of gold, published weekly by the Peoples Bank of China, is still maintained at between 70 yuan per gram (US$240.12 per ounce) and 85 yuan per gram (US$291.44 per ounce), the Aug. 6 Xinmin Wanbao (Xinmin Evening News) reported.

In addition, there is not much room for profits earned from gold jewelry after processing expenses, consumption taxes and value-added taxes are factored in. If the price war wages on, it would likely affect companies long-term growth, the article said.

Those who attended the meeting therefore unanimously agreed to set limits on the lowest sales price of pure gold at 96 yuan per gram (US$329.14 per ounce), or seven yuan per gram (US$24.10 per ounce) lower than the 103 yuan per gram price (US$353.24 per ounce) that existed before the loosening of restrictions.

The lowest price of Shanghais brand-name gold products at well-known stores like the Shanghai Lao Fengxiang Gift Co., Lao Miao Gold and Ya Yi Gold Shop will be set at 98 yuan per gram (US$335.95 per ounce).

Effective Aug. 6, gold stores that had already lowered their prices will reset their prices according to the ones agreed upon at the meeting, the story said.

escapethematrixU.K. Already Meets Euro Tests, Analysts Say; It's Up to Brown#593258/10/01; 07:31:04


Today, analysts say, the U.K. economy -- as measured by short-term interest rates and growth potential -- has indeed converged with that of the euro countries.

The U.K. economic cycle has become significantly more closely aligned with that of Euroland,'' PriceWaterhouseCoopers said in a July report.

Economically speaking,'' the U.K. ``could go in,'' said DeAnne Julius, until last May a member of the Bank of England's monetary policy committee.

The tune certainly seems to be changing relatively quickly in the U.K......It's "inflate or die"....Or join the Euro.

escapethematrixU.S. and British Planes Launch Largest Attack Against Iraq Since February#593268/10/01; 07:48:00


A White House spokesman said President Bush, who repeatedly called Iraqi President Saddam Hussein a menace in recent days, was notified Thursday night of the impending attack, which the White House described as a routine but somewhat heavier than customary."

BR549CNBC sometimes doing the right thing#593278/10/01; 08:04:40

I noticed that this morning occasionally CNBC asks its "somebody please buy this dog my firm owns analysts", after the interview "if they own it." An amazing 100% of the time, they did. At least they're temporarily headed in the right direction. The next step is to ask in advance of the interview.
USAGOLDToday's Commentary & Review: Doldrums End Suddenly, Decisively#5932808/10/01; 08:50:59

Note: If you would like to receive an information packet on gold (how to buy it -- our products and services) and a free trial subscription to our newsletter, News & Views, please go to the link above. For those seeking a higher level of understanding with respect to the gold market, many of the fundamentals discussed briefly below are covered in detail in our upcoming quarterly reviews. Please go to the link above to register for your packet.


In Brief: At about the time the Genoa conference was concluding, I made the general observation that it seemed it was in the best interest of the United States to foster a weaker dollar and Europe a stronger euro. Europe, it seemed, would not want to introduce the euro for circulation at the beginning of 2002 in an atmosphere of dissolution in forex markets. The United States, it seemed, would not benefit any longer from a "strong" dollar at a time when the general economy was in a state of protracted malaise. If nothing else, the prevailing strategy would be to let the markets take the currencies where they wanted with a gentle nudge through interest rate differentials to move the dollar down against the euro.

Now the ECB is making noise about raising rates -- inflation, it says, is rearing its ugly head in Europe -- and, the Fed is loudly trumpeting lower rates to be announced at the next, upcoming conclave. Recession, it says, is rearing its ugly head in America. So, it was (and is)that we thought the time might be right for gearing up the portfolio with a weightier gold position. (And I do believe that this group needs to debate "what the definition of is is.") This has not been lost on either the forex or the gold market.

Yesterday, we saw the first signs that this analysis might hold water when gold left the gate for $5.50 run-up by the end of the day. Today gold is up another $2 as the rally appears to have legs -- at least in the early going. The euro simultaneously is at a 3-month high. Yesterday's action seemed to come out of the blue which is how gold rallies usually begin -- when everything is quiet and the financial markets least expect it.

Remember, too, that we warned in July that the doldrums season often brings a surprise or two and that one should keep an eye on the markets as well as your favorite summertime pursuit. Yesterday's rally got some wind in its sails about mid-session when fund-buying came into the market. Bridge News reports short-covering this morning after a strong carry-over session in Asia and Europe. Wall Street friends are saying they sense something different in the air with this rally and that might have to do with the general bearish growl in the stock markets replete with investor lawsuits over ill-managed accounts, insider trading, laddering and a whole host of other complaints that usually attend bear markets. That general public antipathy with Wall Street bodes well for gold as well. There is also a general sense that the Bush administration favors a weaker dollar but, for good reason, remains loathe to do much more than hint at the policy, or better put, "lack of policy." American politicians generally loathe the prospect of being Hooverized -- one of the enduring lessons of American politics. GWB is no exception.

Stay in touch, and have a very nice weekend. MK

P.S. Let's not forget about ME and oil prices in all this -- fuel for the fire.

USAGOLDWhoops. . . .#5932908/10/01; 08:56:18

This sentence (2nd paragraph):

So, it was (and is)that we thought the time might be right for gearing up the portfolio with a weightier gold
position. (And I do believe that this group needs to debate "what the definition of is is.")

Should read:

So, it was (and is)that we thought the time might be right for gearing up the portfolio with a weightier gold
position. (And I do "NOT" believe that this group needs to debate "what the definition of is is.")

Hill Billy MitchellSpot POG patterns#5933008/10/01; 10:02:49

The London market just closed 12:00 Eastern with a spot POG of $275.10. If the pattern holds up spot POG will make a move during the next 30 minutes or so. The world seems to be perfectly content to let the New York market set the spot POG.



site stewardSweden: Euro to gain more ground, momentum?#5933108/10/01; 10:09:19

HEADLINE: Sweden Mulls Joining European Monetary Union

According to this AP article, Sweden's Prime Minister Goeran Persson said Sweden could join the EMU and have the euro adopted by 2005 -- his party supports the euro, although the decision would be left to a national referendum that could be held following an assessment after the next parlimentary elections in September 2002.

Looking ahead to the January introduction of euro notes and coins among the members of the monetary union as it might influence the referendum, Persson said, "If there will be a good start, then I believe we will join. But if it will be a shaky and somewhat difficult start, I think most people want to wait and see."

A poll last November showed that 46 percent of the Swedish population opposed joining the EMU, but that number has been in decline, now at 43 percent according to a poll in June. Those supporting the euro has grown from 28 to 31 percent. The swing vote of undecideds held steady at 26 percent in each poll.

Meanwhile, in the euro has reached a three-month high against the dollar, and despite the "strong dollar" rhetoric the euro has *somehow* managed to gain 6% against the dollar in the past month alone.

Like it (the euro) or not, the fact remains that the competition (to the dollar) is now there and very real. This alone will upset the world's appetite to continue to absorb our outflow of dollars and bonds. As an alternate holding, gold is independent and shall become viewed as the great equalizer.

miner49erArgentine - Bonds to pay taxes, Round 2#5933208/10/01; 10:31:07

You know the more I think of this, the more I'm convinced that we're going to see more of this. Putting aside all the details, simply this is what's taking place:

1) Government borrows from you.
2) Government can't pay you back, so it says, let's wash what I owe you with what you owe me (bonds for tax payments).

In other words, I borrow $1000 from you (issue you a bond). I say you owe me $1000 (ceremonious "democratic" ritual invoking tax legislation). I say, "Look what a great guy I am, let's call it even-Steven, and forget about it." This is of course very simplistic, and highly cynical, but isn't this really what's happening in essence?

Government default risk is greatly mitigated because taxes are always owed, and the amount owed is not really determined by the debtor (tax payer), but the creditor (tax levyer).

Therefore government can play this game for a while, in that now it borrows voraciously, and whenever it is in a pinch, can raise taxes (arbitrarily increase the amount owed to it by legislative decree -- perhaps we might call this extortion?). Of course there are lots of things to iron out here, for instance:

Popular revolt: revolt happens when the people are pushed beyond the breaking point collectively. You must keep this point from being reached. To do this, you must identify the source of grievance. "It's the economy, stupid." Therefore manage the pain. If you can somehow cause the economy to stumble along, or even improve nominally, there will be absolutely no worry of internal rebellion. Yet, if you carry this too far (essentially borrowing and not paying back), you would bleed the body white. This would mean either

a) the government's productive deployment of these resources must be enough to feed, clothe and defend the entire nation enough to keep it from boiling over (the 20th century communist/socialist paradigm), or...

b) the government's financial deployment of these resources must be enough to allow the people to exist in a tolerable enough condition to keep it from boiling over (the 1990's + corporatist/socialist paradigm).

In a), the thoroughly discussed issues of market mechanisms more efficiently allocating and utilizing resources as opposed to central planning have generally won the day in the arena of manufacturing and services. The evidence of the failure of planned economies is ponderous. However, indeed we have entered a "Brave New World" regarding the financial deployment of resources. (Indeed, too, bravery and foolery are sometimes difficult to distinguish.)

In b), if one can entice external resources to finance your paradigm because of the perceived returns of doing so, you can fuel your consumption as long as your suitors are content to kiss your hand. In past days, the financing model, sans complex derivative "insurance," would consider fundamental issues regarding a potential debtor, and lend accordingly. Checks and balances were theoretically had, in that both creditor and debtor would be responsible for their decisions at a very direct point.

With the employment of derivatives, and the plethora of securities cocktails that are available to bundle up and unload risky transactions, risk becomes so obfuscated, and the originators of a transaction become so far removed from the ultimate point of accountability as to become virtually anonymous. It is no surprise that the fear of a bad decision is practically non-existent. This of course is exacerbated by the moral hazard encouraged by the issuing bank of the world's leading reserve currency.

Therefore, the potential for an influx of external financing is greatly broadened and lengthened. Traders, lusting after buxom returns, throw money at an entity, almost heedless of what that entity represents. It is not really necessary to know or care about how the entity will use these resources (if at all) in a productive capacity (doing and making things that others will pay for). About all that is of concern to them, is that this entity doesn't go belly-up. The focus becomes the marketability of the created financial instrument. This is what is now bought and sold. It is from this that new instruments are even further derived. The arbitrage of these instruments, and their capacity to transmute from junk to investment grade, keeps them viable for trade. The stability and viability of the issuing entity allows for rolling over the instrument at due date, to avoid reckoning, and the perception of continuation of the status quo allows this perception to be modelled into perpetuity.

As long as the piper keeps piping, he doesn't need to get paid.

So, back to Argentina... as long as the financial Shahmans can keep enticing resources into Argentinian securities, the nation of Argentina derives benefit by having money at its disposal to keep the country running, albeit most certainly suboptimally, but hopefully well above the revolt-threshold mentioned above. These instruments can be morphed into whatever, and traded, providing the satisfying returns for the speculators, and the enticement to keep the action at their table. Profligate and foolish deployment of these monies by lousy monetary, or fiscal behavior is covered by the big central banks, principally the U.S. via the IMF currently, as these otherwise not-very-significant players in terms of global influence suddenly find themselves on the TBTF fast train. This is considered internally a cause celebre by their politicians and leaders. So far everybody big wins. And the little guy is told he wins, but ya know, it just don't feel like winnin'...


And finally, how else may this model of bonds for taxes be employed, perhaps in the U.S.? As site steward wisely states yesterday (#59266)
regarding the "evolution of a new usage value for a financial instrument," a premium will be ascribed to otherwise dead instruments if there is the assurance that a "meaningful authority" will step up to the plate and become an Accepter of Last Resort, if you will. While this might, ad absurdium, end up with all kinds of concoctions to give life to allerlei fallen investment angels, from the sophisticated to the populist (beanie babies...? ...or more likely the individual losses of small investors... or perhaps now worthless options promised as compensation to employees?)

I know I'm stretching here, but if the same goals are sought (stability and viability of the debtor entity, in order to perpetuate the Ponzi rollover financing of financial instruments, for the purpose of their arbitrage, whose profitability keeps 'em comin' back for more), then if it's beanie babies that are going to cause them to take to the streets, then why would it not be plausible to think that Sam will say, "O.K., beanie babies to pay your taxes, now shut up and go home!" Or more realistically again, thousands of people who lived on subsistence wages for the promise of Nirvanah when they cashed in their options, are now in debt up to their ears, and un- or under-employed for the debts they've incurred. Maybe the government accepts these options at some premium in lieu of tax payments, or agrees to underwrite some of their personal debt? After all, as long as the financial world still wants to play at our table, these things can be wrapped up into all kinds of high-yield, marketable securities and sold, and that for probably a decent paper gain... And the socialist politicians would love the power grab.

And now truly, finally... since the days of USD hegemony are numbered, this will not work in any large sense (enough to bail out everyone who comes with outstretched hand), unless someone even bigger is willing to lift the head of the US. This bigger one, in my estimation, will certainly be the Euro faction. What will the Euro faction want in return? (They are certainly willing to cut a deal as it is in their interests to not have the US economy crash and burn, as this would invite unnecessary and wicked hardship globally.) But I will stop here because I would stray hopelessly from the original topic. So nothing conclusive here, just some thoughts...

Hope they were of some use...


site stewardGold at a two-month high in London, traders expect it to retain its gains#5933308/10/01; 10:31:51

According to Reuters, one trader said of gold's recent gains, "I can't see any reason why gold should not stay at present levels. I've heard of good two-way trade being reported today."

Barclays Capital indicated, "The most credible in our opinion relates to an Australian related buy-back of a hedge-book."

Another participant told Reuters, "`I've heard something but I don't have enough solid facts to confirm that."

Yet, ever ready with the wet blanket -- and seemingly oblivious to the precarious position of the dollar -- Reuters reported that such producer buy-backs in anticipation of higher prices could be negative: "`If this is indeed the case it is bad news for the short term gold price: if the buy back of a hedge book can rally prices up to $272/$273 it suggests that once confirmation is released prices may quickly reverese their gains unless fresh fund buying reaches the market later today."

Again, keep in mind the macroeconomic fundamentals. In the big picture over time, whether or not these funds bid for the derivatives "later today" is just a momentary blip on the radar screen.

Hill Billy MitchellSPOT POG#5933408/10/01; 10:45:50

This appears to be the beginning of an afternoon leg up before the New York close. Whatever the New York close do not expect any real change in POG until the London market opens on Monday and especially after the New York close on Monday.



site stewardInvestors learn at the school of hard knocks.#5933508/10/01; 11:14:50

HEADLINE: Slowing economy rewrites stock market rules

NEW YORK, Aug 10 (Reuters) - Gone are the days when announcements of job cuts sent stock holders jumping for joy and share prices soaring.

"When equity markets were doing well, investors saw layoffs as positive," said Dan Rivera, chief investment officer of American Express Asset Management Group's large-cap growth division. "They thought cuts could make companies more efficient, expand profit margins, and make them able to produce at a lower cost."

These days, layoffs push stocks under water as investors see the cuts as a last-ditch attempt to pump up corporate profits amid a global economic slowdown. It's the latest sign that the lagging U.S. economy has rewritten the rules of the stock market.

"There's a whole new round of recession-type strategies being employed by Lucent and American Express," said Ned Riley, chief investment strategist for State Street Global Advisors, which oversees $720 billion. "There's a feeling that the unemployment rate will go up even more, hurting stock values and eroding the wealth that people had been relying on."

"Now the market isn't reacting well to layoffs," said Rivera. "Investors wonder if consumers can keep buying enough to keep the economy out of recession."

In addition, layoffs now signal the economy may be getting worse, leading investors to pull out of stocks.

These excerpts sure sound bleak. Hopefully, you have already formed a healthy perspective about the "performance benefits" of tangible goods and hard assets (that is to say, real wealth; not paper illusions of wealth).

To maintain the banking system in functioning order, the Fed can be expected to continue to ease monetary policy to promote inflation of the currency so that EVERYONE in the dollar system (including the savers who shall see their dollars devalued) shares the pain in the workout. The evolving monetary wisdom says to an indivual regardless of geography, "Why save dollars, pesos, euros, etc. when you can avoid this element of currency risk by saving gold instead?"

Seize the helm and be the captain of your own fortune.

site stewardFed adds, although bank liquidity seemingly not needed#5933608/10/01; 11:35:46

The market in overnight federal funds was trading below (3.69%) the FOMC's target (3.75%) for monetary policy, yet the Fed conducted open market operations to add $1.745 to the banking system using over-the-weekend repurchase agreements.

FOA, your recent trail message made me laugh out loud... "...response from the Fed. They will not be pushing on a string; rather picking up the ball of twine and throwing it!"

You're the best!

auspecSilver#5933708/10/01; 12:43:55

Someone smoked some silver today, Dec. COMEX Silver down 7.20.
Hmmmm.........maybe another use for Ag............smoking?

Buena FePreaching to the choir#5933808/10/01; 12:53:21

This one is another hoot......can you believe the extent to which people (sheople) will have "faith" in their financial/political leaders??? C'mon Argentines......stand up for your selves........BUY GOLD!
08/10 14:08
Argentina Aims to Build Confidence in Bid for Loans (Update2)
By Peter Wilson

Buenos Aires, Aug. 10 (Bloomberg) -- Faced with a decision of what to do with 30,000 pesos in savings, Daniel Katzman left it all in a bank after hearing Argentine Economy Minister Domingo Cavallo say he'd seek $9 billion from the International Monetary Fund.

The government, in talks today and tomorrow with the IMF, is hoping to persuade more people to do the same. Unfortunately, Argentines in rising numbers are pulling savings from banks, and many economists say another $9 billion won't be enough to stem the outflow and prevent a devaluation or government debt default.

``There's a very serious lack of confidence in the system now and chances are that an extra six or nine billion dollars would not be enough to restore it,'' said Paulo Vieira da Cunha, senior economist for Latin America at Lehman Brothers Inc. ``The IMF knows that and the Argentines know that.''

Katzman, 40, a computer programmer who keeps his savings at Citibank NA, is putting his faith in the government because he believes Cavallo is taking the right steps to ensure Argentina can meet payments on $130 billion of debt and maintain the peso's one-to- one peg with the U.S. dollar. Argentine bonds rose for a fourth day on hopes Argentina will secure the additional financing.

``I have confidence in Cavallo,'' Katzman said.

Such optimism is exactly what the government is counting on to pull itself out a financial crisis that has doubled the country's borrowing costs since June, drained more than $6.1 billion from the banking system in six weeks and left the central bank with $15.6 billion in cash and gold reserves, 25 percent down from six weeks ago.

Currency System

Depositors are pulling an average $300 million a day from Argentina's banks and hoarding dollars at home, putting the country's decade-old currency system at risk. If it fails, economists said, the government may have no choice but to devalue and default on its debt.

``The government must brake the run on deposits, or it's over,'' said Abel Viglione, a senior economist at the Buenos Aires research company Fiel. ``Everything depends on this.''

The IMF already has agreed to speed a $1.2 billion loan payment to Argentina. The government says it's in negotiations for as much as $9 billion more. A cash injection of that size would help replenish central bank reserves and buy the government time to try to revive confidence in the currency and banking system, economists said.

Still, Argentina would need to prove it can limit spending and reduce the budget deficit enough to cover its debt obligations.

The $9 billion ``is a comfort zone,'' said Rafael de la Fuente, senior Latin American economist at BNP Paribas. ``The fall of reserves and the outflow of deposits is caused by a sense that the government is not going to make it, and that is what is driving people out the door.''

Argentina's benchmark bond rose 1.125 to an offer price of 74.813 to yield 24 percent, according to J.P. Morgan Securities Inc. prices.

Deposit Outflow

Argentina's banks, both government-owned and private, have a total $80 billion in deposits. Standard & Poor's analyst Carina Lopez said the banks can afford to lose another as much as 25 percent more in deposits.

``The danger zone is when deposits fall to between $50 billion and $60 billion,'' she said.

A run on deposits would leave the banks, the main buyers of government debt and chief lenders to companies, too strained to support the economy, already in recession.

Cavallo, in a speech Wednesday night, reiterated the government would avoid a devaluation and default.

Yet evidence is growing that the currency system, which requires that every peso be backed by dollars or gold at the central bank, may not hold.

Reserves Fall

Central bank cash and gold reserves have fallen below the supply of pesos, including repurchase agreements, or repos, that the central bank uses to supply cash to banks. An imbalance of up to 33 percent can be backed by government bonds.

The Buenos Aires province already has opted its own currency, the patacon, and Argentines are finding it increasingly difficult to find dollars. Only the state-owned bank offers dollars at a rate of one-to-one and several of its branches regularly run out the U.S. currency.

Susan Bonfiglio, a 49-year-old administrative assistant in a financial services company, is skeptical the government will stave off devaluation and default. Still, she's holding out hope, opting to leave her 400 peso savings at state-owned Banco de la Nacion.

TannehillSir Hill Billy Mitchell @ (8/10/01; 06:38:24MT - msg#: 59323)#5933908/10/01; 13:04:48

You asked:"BernzOmatic" silver solder... Any one out there know exactly how many troy ounces of pure silver is in a 3-ounce roll of this stuff?

I suspect you have the 4% stuff, so not much. For a more definitive answer ask you question at this link.

That's all from Tannehill

Old YellerCheckmate for Greenie#5934008/10/01; 13:19:22

Interesting times indeed.Especially if one is a gold advocate.It's been a long time watching this silly cycle play out.Yep,this time it's different,alright.

Thanks to bearlysurviving for the link.

USAGOLDSomething to contemplate. . ..#5934108/10/01; 15:54:33

How bad is bad?

How good is good?

How high is high?


In 1913 you could buy an ounce of gold in Germany for about 80 marks.

In 1924, a little over a decade later, you could buy an ounce of gold for 60,000,000,000,000 marks -- that's 60 trillion.

And at the time, you would have rather had the ounce of gold than the 60 trillion marks.

site stewardHere's a brief overview of the German hyperinflation that MK mentioned#5934208/10/01; 16:14:01

This also includes the nifty graphic I assembled many months ago. Wow, we're a multimedia organization! And the phones work, too!

I can almost see FoxNews looking anxiously over their shoulder...

site stewardHey, wait a minute, MK...#5934308/10/01; 16:31:04

With a few futures contracts held with the right timing as the German financial world was falling you pieces, you could have leveraged that 60 TRIL into a helluva lot more.


(Unless they pay you off with one note.)

Black BladeU.S. firms struggle for steady flow of natural gas#5934408/10/01; 17:18:21

Gas wells in U.S. being depleted at increasing rate


In the United States, 50 per cent more gas wells are expected to be drilled this year than in 2000. Strong prices and stronger demand underpin much of this activity, but there is another reason: Gas wells are being depleted ever faster, pitting industry against nature in a struggle to maintain a steady flow. ''We'll need tons and tons of these to help dig our country out of the mess we're in,'' Anadarko chief executive Bob Allison said of the region in East Texas where his company is sinking about 100 wells a year. The ''mess'' refers to the 23 per cent annual decline in U.S. base production, up significantly from 1990, when the output from existing wells shrank only 16 per cent a year.

''We're on a treadmill that's making us go faster and faster just to stay even,'' said Skip Horvath, president of the Natural Gas Supply Association. Last year there were 16,000 new gas wells drilled, up nearly 60 per cent from 10,400 drilled in 1999. But output only rose about two per cent over the same period, according to estimates from the U.S. Energy Department. The industry is on pace to add 24,000 wells by the end of the year, with only a marginal uptick expected in production. ''But you've got to drill three wells ... to get the equivalent of one well found three or four years ago.''

Black Blade: The media has just begun to wake up to the fact that the energy crisis is here to stay. They do spin the lower energy prices (from a very short spike to $10.00 Mbtu in December). Prices will be higher than average and will go much higher as the industry cannot produce enough NG. Over 300 new NG-power plants are scheduled to come online by 2006. There are no more drill rigs and no one builds them anymore. In spite of a doubling of drill rigs since 1998, there is only a mere 2% increase in production. And if fuel cell technology becomes viable - look out as the hydrogen is expected to come from NG. We have an energy crisis of epic proportions in the making in spite of a deepening global recession. Time to go for the gold so to speak. Gold and silver portfolio insurance is becoming an obvious addition to one's holdings. Other items to get are a few months cash supply, fuel, nonperishable food and drinking water for unexpected events such as unemployment, natural disaster, etc. At least you will sleep better at night.

Good Article!

Black BladeOil Up on West's Greater OPEC Reliance#5934508/10/01; 17:28:23


LONDON (Reuters) - Oil prices climbed strongly on Friday after the West's energy watchdog made a big upwards revision in demand for OPEC oil this year and next. Escalating violence in the Middle East also lent support, as did evidence that Kuwait will slice September deliveries in line with OPEC's forthcoming production cut, brokers said. London futures for benchmark Brent Blend crude oil delivered in September climbed 30 cents, or 1.2 percent, to $25.98 per barrel. The International Energy Agency, which protects the interests of oil consuming countries against the OPEC oil cartel, made big upwards revisions in global oil demand forecasts for this year and next in its monthly oil market report published Friday.

Black Blade: The Horseman Cometh! Energy demand is to continue to rise. It is "Cheap Oil" and "Cheap Energy" that fuels the Bull Markets. Without a steady and secure supply of "Cheap Energy," the result is recession. This time we could slide over the edge into the abyss. Time to get a "Golden Lifeboat" to navigate through these stormy seas - a coming economic storm - "The Perfect Storm."

NetkingAuspec etc#5934608/10/01; 17:45:02

McAgspec(59337)Re: Silver(what else, grin!).

Do you think Sir that move was significant or a minor retracement & profit taking?

I think we might've seen "THE" bottom this last week at around $4.10 spot . . . just TOO MANY bullish factors emerging Mc for the paper pushers to push lower, thoughts anyone?(member of 'to the moon' club)

site stewardThe reason you need gold: "Dollar tumble risks scaring overseas investors"#5934708/10/01; 17:59:48

From the URL cited above:

LONDON : Growing speculation the dollar may have ended its six-year bull run is unnerving overseas investors in US stocks and bonds, where a rising dollar exchange rate has long underwritten those assets for foreigners. (J)uicy returns on US assets from a then booming economy were enhanced by a steady grind higher in the dollar in a "virtuous circle" for overseas fund managers.

But the recent sharp slowdown in both the domestic and global economy has raised questions as to whether a strong dollar is still sustainable or even appropriate.

"Any perception the dollar could crash would send overseas investors bailing out of US assets, creating a vicious downward spiral for the dollar," said Steve Cleal, head of balanced funds at Morley Fund Management in London.

The Rueters article concludes by quoting a chief economist, "If foreign investors' appetite for dollar-denominated assets were to diminish, the result could be a sharp plunge in the value of the dollar - and subsequent potential havoc in the US bond and equity markets."

You know what you need to do. The only thing left for you to decide is when, and how much. Nobody is going to do this for you, but Centennial is willing to help if you call.

Centennial Precious Metals, Inc. / USAGOLDHard assets... Easy access!#5934808/10/01; 18:05:48

Swedish gold

Gold Today!

Because you never know what tomorrow will bring.

R PowellNetking/Auspec/Silver watchers#5934908/10/01; 18:50:21

Silver still looking for a bottom? It fell enough to reach my offered price on a July 2003 call. Scary though, it's value is all time value.
My copy of The Silver Institute's World Silver Survey came in today's mail. I'm surprised at how quickly it arrived. $95 for 84 pages. There were a few years of my college adventure when $95 was more than I spent on a year's worth of books. I majored in Medieval History which explains, in part, why I pour concrete for a living.
Anyway, I had decided to continue a scale down buying program in options and Silver Eagle coins if POS continued down. If the 84 page Survey 2001 doesn't convince me otherwise, I'll buy again at around the $3.90 level.
Have just started reading the Survey. Like most commodities, it starts with supply and demand and lists "Implied Net Disinvestment of 102.0 million ounces to account for the difference in supply/demand for year 2000.
That is, 102.0 million had to be added to supply to equate with the 946.3 million of known demand.
I need to study more and will report if I find anything newsworthy. Silver going down?? Do we buy the dips!?
Happy weekend

Tree in the ForestBR549#5935008/10/01; 19:07:16

I agree with your post #59306. Trail Guide has seemingly clarified his comment of several months ago re: 50 cent silver. As I understand him, he really doesn't mean that silver will see 50 cents per ounce. Just that if silver does not respond to a gold move and continues sideways, the resulting inflation from a dollar crash would send silver to a 50 cent value compared to what it was worth before the dollar tanked. In other words, $5.00 worth of 90% deflated dollars. While silver might eventually take off nicely, there would have been an opportunity cost for being in silver rather than gold. Originally, based on my Comex default scenario, I had thought that there might be an opportunity to take profits in silver and transfer them to gold. Now this is looking more and more unlikely. However, there might be a chance to do the opposite; take profits in gold and move them into silver. Time will tell.
Tree in the ForestAnother item that won't move gold; and one that might#5935108/10/01; 19:11:53

I have been forced to re-think my predictions made several months ago. Last March, I assumed that silver and gold would be liberated via Comex default in June and July. It seemed to me that a Tocom style default might be the trigger to get gold and silver going. This has not happened. While it still might, I am thinking that this is now less likely. There was an opportunity for this in June-July but the warehouse stock of gold and silver have not changed a whit in several months. My thinking now is that it will be a political decision that will set things off perhaps by a drop in the dollar and/or a stock market crash. Another item can now be added to my list of things (generated a few weeks ago) that will not make gold go: Comex default.

But there is another item that I have not discussed that could mean gold's release, a significant event this week that is off most people's radar screens. Beesting originally alluded to the possibility of a 30 year work out period after Nixon closed the gold window. In thinking about his for several months I came to the conclusion that this may well be related to Treasury securities.

The longest Treasury is of course the 30 year long bond. It seems to me that such bonds issued before August 15, 1971 almost certainly could be settled in gold; current bonds are probably cash settlement. I don't know the last issue date of these gold bonds but certainly the last of them will mature on or prior to August 14, 2001. I can easily see an "understanding" existing between the US and Rothschild. He keeps the POG down, we pay his bonds in gold as promised. August 14 is next Tuesday. Once Rothschild has the last of his gold, the need to keep POG under lock and key is removed. Gold can go free. Thus the Russian prediction of a dollar crash on Aug 19th is quite plausible. This is the reason that I had some confidence in predicting that gold would move in the July-August timeframe.

Tree in the Forestsilver vs gold#5935208/10/01; 19:33:46

Many people, myself included have wanted to invest in precious metals on a budget; we chose silver as our primary vehicle. This may be a mistake.

It may be the exact same mistake that people make when investing in penny stocks. "Look! I've got ten thousand shares!" But the question is, will your ten thousand shares of that inexpensive stock, outperform the one share you could have bought of Berkshire-Hathaway? Answer: quite possibly not. Some of the best stocks are also the most expensive. Thus, one ounce of gold at $275 could outperform $275 worth of silver.

How could this happen? Well, if gold and silver are not to be released by Comex default, it may be that only gold will be released for reasons I have stated below. Silver could remain a prisoner. Gold would thus be free to perform in a dollar meltdown, while silver would remain little changed. Even if silver doubled, it would not outperform gold that tripled. We simply don't know when silver will be released. It could be many months. In the meantime, you might have greatly increased your money in gold. Then sold some gold to buy much more silver than you ever could have when the time was right for silver to go. This is my current thinking. But it's your money so you must decide.

NetkingRich - WSS#5935308/10/01; 19:33:58

Thanks Rich, any info you want to pass on from your WSS would be valuable.

Years ago I heard a classic Zig Ziglar statement: "If your outgo exceeds your income, your upkeep will be your downfall!" . . . aka The 1990-2001+ Silver Market.

You cannot as a consumer (of anything) keep taking more from the pot than what you put in . . . not forever that is. . .

I believe this last week was significant price wise. I'm talking with my "better half" about purchasing some more physical and another call or two.(INVHO)

MarkeTalkAre you from Missouri?#5935408/10/01; 19:41:20

I have discovered a new contrarian indicator: those clients of here at Centennial who know in their hearts it is time to buy gold but still are led astray by the siren song of CNBC, Wall Street Journal et al. They tell me that they want to see gold running away to the upside, but yet hope to buy it at the price before the big move occurs. Sound ridiculous? It is a variation on the theme of "Show me--I am from Missouri."

Well, "Missouri", here is list of items to contemplate. First of all, this week presented us with fresh violence in Israel (15 dead and 100 injured in a suicide bomb attack) and the threat of further escalation to all-out war with Iraq and Syria. Secondly, today's papers are filled with renewed concern about Argentina defaulting on its $130 billion debt, which would surely crash the world's financial system. Thirdly, Big Al Greenspan added another $25 billion to the money stock this week, hoping no one (especially the watchdogs of inflation) would notice. Fourthly, the economy continues to descend into the abyss with more layoffs being added to the "Bone Pile." Need I go on?

You know, stock market veteran Joe Granville used to say that a new bull market would climb a wall of worry in its initial stages despite the timid and scornerful. Then as the bull market accelerated higher, it would win over those skeptics. Then finally, the herd (i.e. public) would participate and push the market beyond any rational expectations. We saw this very thing happen in the Nasdaq over the last seven years. Gold in now in the initial stages of a massive bull market but only the wise and perspicacious, those with a sense of history and values, are buying. As gold moves above $300 per ounce, the "doubting Thomases" will begin to change their views. Finally, as gold accelerates to over $400 per ounce, the trend-following herd (i.e. public) will come thundering in to buy at any price.

The bottom line here: I hope that this short post will move some present and future Centennial clients to stop procrastinating and get aboard the gold ship before it leaves the harbor. Being from Missouri is commendable for a lots of things in life, but buying gold is unfortunately not one of them.

auspecNetking Gol{D} & Rich Silver#5935508/10/01; 19:44:48

Will quote from info from David Morgan's Silver investor several weeks ago. DM received this letter.
"I don't know if you know of this or not, but a few BIG forecasters have predicted a huge bull market in the metals, particularly silver, about to begin sometime between now and Oct-Nov. I'm talking particularly about Bob Prechter of Elliot Wave Theory and Mr. Flannigan of Past Present Futures newsletter. Both of them are telling their subscribers to get ready to invest large amounts in silver. They are waiting until silver reaches the $4.10 to $4.15 area, WASHOUT territory- the classic indication of a bottom. I believe there are a lot of major players waiting to put in large amounts of money WHEN SILVER TESTS THE $4.10-$4.15 AREA {considered the 4 year low)."
"Are you aware that in Feb 01 Prechtor sent out letters telling everyone to change their mindset about silver because a HUGE opportunity would be presenting itself in the fall." END

Comments: Rich says "Do we buy the dips?" My advice is to wait and buy the last dip {snicker}! Actually, we cannot know the last dip, but this one feels pretty good. Being sated in physical and pennystock silver plays with options, today dipped back into that wonderful institution known as COMEX {or CRIMEX}, picking up Dec silver at $4.16. Will take my chances there.
Now as far as the prognosticators of .50c silver, I do not know how one can think this way w/o believing there are mega amounts of unknown above ground silver available to impact the market {black silver}. You don't believe in the existence of black silver? Then the commodity cycle will play out in full, no other way out of this mess. Larry Edelson of Weiss connection says we're heading for $2 silver, but he believes or at least claims to believe there are large quantities of silver overhanging the market. Who in their right mind, should this silver exist, would want to try to get thhe lowest possible price for their wares? Maybe the British {HaHa}.I priced VG Morgan and Peace dollars today, approx 8.16 and 7.92 respectively. they have held up fairly well in the face of a significant fall in POS this year. Don't know about the bags.
On the silver trail, good to have some company.

NetkingAuspec#5935608/10/01; 21:00:03

A . . . posted that letter at K2 last night, great minds think alike(or "fools seldom differ"! Martin & Larry chime)

Regardless of the actual market timing IF enough people declared "It's the bottom!" and bought physical silver because it is at 5,000 year inflation adjusted lows . . . that tiny market would ignite anyway yes.

All we need is another Hunt, Berkshire etc, one spark(hopefully without loss of life yes)

R PowellWhere is MoutainGold?#5935708/10/01; 21:15:56

Andrus sommerselg (59285), thanks for the info on the availability of 100 ounce bars. All the speculation of supply is confirmed or denied by the buying process.
Solomon Weaver (59311) asked, "Hey what ever happened to MoutainGold?" Good question, lost on the golfcourse? You out there MoutainGold?? Solomon mentioned him in reference to chart reading of NEM. What does your TA chart study predict now for equities, U.S. dollar, gold and silver???
Auspec, does Larry Edelson give any references to any verification of the large silver supply he believes exist?
Does he say who, where or how much?
Also, you will tell us, old buddy, which dip is the last, won't you? If the Survey doesn't dissuade me, I'll try to buy as many as come our way as long as I'm able and our research keeps telling us silver is grossly undervalued. Opinions like Edelson's need looking into, I believe. What does he know that we don't and where is he getting his information?
So many questions.
Thanks to CPM for allowing silver talk on the gold forum. I have bought Silver Eagles from M.K. and am awaiting another shipment now. Easily done with one phone call and, of course, the check in the mail.

Cavan ManMarke Talk#5935808/10/01; 21:21:01

Hey, I'm from Missouri and I am one of your customers. Furthermore, there is a reason why I find your firm listed in the Yellow Pages here yes? I am sure you know that some of your best customer s and prospects are from this part of the US. Now, don't take me for geocentric because, I am definitely not. I just wanted to take this opportunity to say that since we are from the "Show Me" state; by association with that motto; we do not as a general rule believe in moon cycles and sun cycles and star gazing and other esoteric astrologica. Kind regards...(a customer from MO.)
Black BladeCoal-bed methane tapped to help ease energy shortage#5935908/10/01; 21:39:57


Responding to a rising demand for power sources, energy companies in Canada and the U.S. are turning their roughnecks loose on potential pools of coal-bed methane, a type of natural gas trapped in the seams of coal fields. The state of Wyoming expects the number of coal-bed methane wells there to grow eightfold to 70,000 between this year and 2010. Consumption of natural gas, the cleanest-burning fossil fuel, is expected to increase in the U.S. by more than 50 per cent during the next two decades, according to U.S. President George W. Bush's energy plan released in May.

Nearly every new power plant burns gas, which pollutes less than coal or oil, and shortages of the fuel drove prices to record levels in December. To avert a shortage, the administration is pushing to open more federal land for drilling. The boom is occurring even as half of the land in Wyoming remains off limits, while the U.S. Bureau of Land Management studies increasing industrial access.

Black Blade: Still this is not enough and barely addresses the energy crisis. This boom will result in more drilling and yet there are not enough drill rigs to even begin to bring on necessary supply. Many of the most likely targets for CBM remain off-limits and drilling permits are routinely held up by "held-over" bureaucrats from the last administration. CBN is what could be classified as a nonconventional hydrocarbon. However, CBM is becoming extremely important as other natural gas supplies dry up. The struggle to address the energy crisis will only deteriorate and the economy along with it. This Horseman is slowly but surely approaching (The Slow Burn). PM insurance looks more important than ever.

BR549Gold vs. Silver#5936008/10/01; 22:20:29

Tree in the Forest (#:59350)

I am new to the site so I missed Trail Guide's $.50 silver scenario. There is so much here to catch up on. Great comments in re: to silver being priced in relative deflated dollars to the price of gold. My opinion is that the rest of the world is going to gang up and drive the dollar away from being the world's standard currency, which of course will make gold go through the roof. I do not know whether this will have a positive correlation to the price of silver or not. Your theory of taking gold profits and then moving into silver may be the way to go.

The Russians moving their populace to value-based currency us a sure sign that they want to unload their citizens stash of greenbacks. If they can get them to trade for gold coins, then they can dump them on the world market, accelerating the FRN's demise. I prefer gold over silver (although I own both) because it makes my pulse race more when I fondle it.

Enjoyed your posts and can't wait to see what happens next week.

Black BladeThe Mystery Of Slobodan's Gold#5936108/10/01; 22:25:59


"On the road from Nis there is a hill called the Hollow Rock. On the top nature has carved out a heart shaped hole and in that hole the Byzantine Emperor Vasillis hid gold and covered it with boulders." Well, writes Sky's Foreign Affairs Editor Tim Marshall, it's a good story, but would you divert your army's resources to finding the hidden treasure? Slobodan Milosevic would.

Black Blade: Barbarous relic? Funny story at the link.

Black BladeArgentina Seeks New IMF Financing as Reserves Fall#5936208/10/01; 22:41:34


New York, Aug. 9 (Bloomberg) -- Argentina's dollar and gold reserves have slipped below the supply of pesos, undermining the decade-old currency system the country adopted to inspire confidence it won't print money to pay debts. The currency board set up in 1991, which requires Argentina to back every peso with dollars or gold, allows some flexibility. Still, the shortfall puts pressure on the government, which is struggling to avoid default on $130 billion of debt, to stem an outflow of deposits and line up more financing.

To cover the wave of withdrawals, the central bank has increased the amount of cash it provides to banks through repurchase agreements, or repos, which are backed by government debt. Cash and gold reserves fell about 25 percent in less than six weeks to total $15.4 billion on Monday, according to the most recent central bank figures available.

The withdrawals have put Argentina's currency system at risk. For the system to work, all the pesos in circulation must be backed by dollars or gold in the central bank's vaults. On Friday and Monday, central bank reserves dipped below the amount of pesos. The imbalance of up to 33 percent can be backed by government bonds. If withdrawals continue and reserves keep falling, Argentina's currency system will be at risk, economists said. Since World II, no such system -- used now also by Bulgaria, Estonia, and other countries -- ever has collapsed.

Black Blade: Argentines run on the banks? They could use some gold insurance I think. Now that the IMF is sticking their nose into this mess - after saying that they wouldn't - the austerity measure they will impose could possibly spark another revolution.

Canuck@ BB & all#593638/11/01; 05:53:43

I saw an article in the Globe and Mail this week for General Motors. They have developed a new fuel cell for home generated electricity. It is of course powered by natural gas. I've been watching the developments of the fuel cell companies to some degree (with regards to fuel cell powered cars). The big 3 seem to have the 2003-2006 window in mind for this next generation of vehicle.

I've been reading your spendid notes for a long time, I have duly noted your "natural gas is the sleeper" quote.
It seems to me that a great deal of 'energy crisis management' is being placed upon the infinite availability of NG. A pile of eggs are being placed into the 'natural gas basket', yes?

How do you feel about 'energy' trusts? I put a couple of dollars into a 12 year old trust just to see where it goes.
The dividend just seems to be too good to pass on. Now I'm thinking of a NG play. I'm looking at AEC, AXL, TLM, HTR and CNQ. (all on TSE300) I am ignorant of the US majors.

Any that you 'like'?

BTW, did you get a chance to read the 2 '' articles? The 2006-2008 'energy crossovers' are astonishing.
The mild energy crisis currently underway will pale in comparison to what we face in a few years. There is absolutely no doubt in my mind that the energy situation is a 'springboard' to POG. It is one thing that I am certain of.

There will be fear and tears in a few years.


canamamiIdle Musings#593648/11/01; 08:22:18

Re Argentina. The peso must be backed by dollar and gold reserves (Note: I thought Argentina sold its gold). The peso is linked to the dollar. The system is out of whack because the dollar is overvalued, and also because it is unwise to link your currency to another country's economy.
Would it not have been wiser to replace dollar "backing" with IMF SDR backing? The non-dollar component would prevent the SDR from being as overvalued as the dollar plus more stable long-term, with fewer strains on the Argentine economy. This would be acceptable to the IMF also, one would think.

Re wealth effect. Would it not be better to allow gold to rise, by stopping the manipulation? Gold would rise against all currencies, not just the dollar, so the optics would not be all bad for the dollar. Private holders of gold would be "wealthier" than present. Hence, the gold wealth effect could temper the current decline in the equities markets, and assist the economic turnaround.

site stewardFor canamami#5936508/11/01; 10:04:24

Argentina is not COMPLETELY out of gold, having about 10,000 ounces. But to put this amount into perspective, I think Centennial might have a few clients with this much gold -- great for an affluent family, but a dismal amount for a whole country of Argentina's size.

Regarding your second paragraph: you have precisely hit the mark... a picture of the future. The international political will is behind this.

BR5491929 all over again#5936608/11/01; 10:12:03

Buena Fe (msg#: 59338)
Preaching to the choir

Your quote about what is currently happening in Argentina: "Depositors are pulling an average $300 million a day from Argentina's banks and hoarding dollars at home, putting the country's decade-old currency system at risk. If it fails, economists said, the government may have no choice but to devalue and default on its debt."

What happened before the Great Depression: "It is a fact of economics that all recessions are preceded by a glut of goods on the market, and this was especially true before the stock market crash of '29. Supply was everywhere; demand nowhere. Why? Because a growing number of poor people chose to hoard their money rather than spend it. This is a rational anti-poverty strategy for individuals, but it has unintended and damaging consequences for the group." (see link)

What is happening in the US today? Hoard your gold and silver, your gonna need it.

auspecRich#5936708/11/01; 10:58:41

Regarding your questions about Larry Edelson and his $2 POS prediction, I can only elucidate as far as my memory serves me in regards to being a Weiss Safe Money Report subscriber around 2 years ago. Edelson has an extensive background in precious metals so he is clearly no novice. He supposedly has contacts that informs him of massive amounts of silver available in places like Dubai as well as the Orient if memory serves me well. There is NO substantiation, simply his word, at least at that time period. As I have said several times in regards to Edelson, they also called for $200 POG the year of the WA when gold went to $330+. Weiss is a doomster that is ALWAYS calling for the sky to fall, but also with information that is often at least somewhat credible. Sensationalism sells, you know.
Again, who are the morons intent upon getting the lowest possible price [down to $2] for the last remaining above ground silver surplus? If the silver does exist, and it has not been substantiated as existing, it makes little sense to dispense of it in this manner. On the other hand, if it is in the hands of the banksters and the Anglo-American anti gold and silver crowd, there is much further damage they could do with it. Maybe even square their books before going long? How about it Larry, you tight with GS, AG, USTreasury and British elitists?
Whereever the POS bottom is we must constantly remember what WILL happen from that point on. It's called a reversal of interests and WE will be onside with the insiders. They have NO chance of taking silver to $2 and keeping it there long term, and will not miss the opportunity to make money as silver goes in the opposite direction. This is simply what and who manipulators are! What good does it do the Anglo's and Buttock Golds to vulturize their neighbors properties if they don't intend to make hay out of it in the long run? Please re-read that question and make sure it settles in fully!

Black BladeArgentine Gold#5936808/11/01; 11:03:28

I know that Argentina sold off a lot of their gold reserves. I wonder if the gold Argentinos that MK had for sale here not long ago were part of that. I suppose that there are no more of those available is there? I got some of the gold Uruguay 5 peso coins. I read the article and I too was surprised at the statement that Argentines could exchange their pesos for USD or Gold. I somehow doubt that there is enough gold for exchange and now with the run on the banks...

- Black Blade

Black BladeRE: Canuck - Energy Trusts, Growing Energy Crisis, etc. #5936908/11/01; 11:06:45


I don't make stock recommendations. I have stated on occasion what I do hold in order to disclose my position to "clear the air." First many don't understand what energy trusts are. Sometimes large energy corporations will bundle some holdings such as a particular property (usually a mature petroleum producing property) and spin it off as a separate holding or as an energy trust. There are oil, energy, and natural gas trusts and some do pay very good dividends. In a way they are like REITs (Real Estate Investment Trusts). They pass through a large portion of earnings through to unit trust holders. The danger is that these tend to be older or marginal producing fields. If the management has a good record and if energy prices continue to rise, the pass through earnings can be phenomenal. On the other hand if a field is nearly depleted and output is in serious decline - so are the pass through earnings (or dividends). One should do their due diligence and really study each one before investing. I like several energy trusts and I do hold some. For example I now hold SJT as a play on NG, BPT as a play on oil, and DOM as a play on both (all have good dividends). I have several others as well, but you get the picture. I am unfamiliar with the Canadian trusts. As I said, really look these trusts over with a strong magnifying glass and see what the depletion rates are, the background of management, reserves, etc.

You are right about fuel cell technology. The additional pressure on natural gas from fuel cell technology along with over 300 new natural gas-fired power plants coming online by 2006 and the inability to increase natural gas production makes natural gas the real "energy sleeper." Natural gas is the fuel of choice as it is clean burning and has virtually no particulate or very little emissions pollution. Natural gas has become the fuel of choice as coal and oil are "dirty fuels" and power companies are allowed a limited number of "carbon credits" to operate. Once these carbon credits are used up the power plants must close down or purchase more carbon credits on the commodities market (they can trade like commodities). Under the current political situation there is not much choice for energy companies to do anything but place their energy eggs in the "natural gas basket."

Energy overall is what drives the economy. It is "Cheap Energy" that powers the Bull Markets. The Bull markets came to an end and even slipped into recession when oil, natural gas, and energy costs increased from the rock bottom prices of 1998. There is no capacity to increase natural gas as drill rigs are in short supply and most likely productive targets are off-limits, oil production is controlled by OPEC and a few independents who are content to "go along" and production is nearly maxed out, refining capacity is severely limited, the energy grid is decaying and the infrastructure has not been increased or upgraded in decades, demand still grows in many regions, energy costs are much higher (2 to 3 times) than in recent memory, and power blackouts and warnings are common place. Whew! Add all that up and it equals a real energy problem coming at us. That light at the end of the tunnel is an oncoming train!

We can only lookout for ourselves as no one else will do it for us. For me that means very selective investments, gold and silver (bullion and numismatic) for portfolio insurance, a food and water supply for basic needs, well stocked first aid kit, firearms and ammo for hunting, etc. When the energy crisis hits full force I expect Gold and Silver prices to skyrocket although I look at PMs as important portfolio insurance rather than an investment. That does not mean that PMs can't be an amazing investment under the right conditions. I look at PMs as insurance because if currency is failing why would one want to exchange PMs for a failing currency? On the other hand selling some to cover payments in "fixed" dollars such as loans, etc. could be a bonus. Anyway, that's my take on it. Cheers!

- Black Blade

Black BladeHistory Channel - Gold Series#5937008/11/01; 11:42:48

The History Channel will have a special series on gold and the impact of gold on history. Details at the link.
Black BladeCalif. May Have Costly Energy Glut#5937108/11/01; 12:13:53


LOS ANGELES (AP) - California may have a costly glut of electricity through 2004 because of the long-term power contracts it signed to end the current crunch, the Los Angeles Times reported Saturday. Predicting rising demand, California signed long-term contracts earlier this year with private energy suppliers to buy power at fixed prices. But last month, the state lost $46 million when cool weather reduced electrical demand and prompted officials to sell power bought at high prices for a loss. If current rates continue, the state could lose $500 million in the next year alone by selling off surplus electricity at a loss, according to a Times analysis. The newspaper reviewed the state's power purchases and projections over the next several years but noted that weather, the economy and other factors could change the supply-and-demand balance.

Black Blade: The Grasshoppers can never seem to get it right. Regulation has not been kind to the Grasshoppers. Central Planning Marxist style has been a disaster. Now Kommissar "Red" Davis is taking the heat once again. It just may work out though as energy prices could rise much higher going forward. However, "Buy High - Sell Low" doesn't sound like much of a financial plan. Energy prices in the People's Republik of Kalifornia are likely to remain high. Can't be good for Silicon Valley either.

LeighJust Wonderin'#5937208/11/01; 12:35:00

August 19th, the day of the big dollar crash, is a Sunday. How can the dollar crash on a Sunday?
Black BladeSlow Economy Rewrites Stock Market Rules#5937308/11/01; 12:35:27

Lessons from the "Bone Pile"


NEW YORK (Reuters) - Gone are the days when announcements of job cuts sent stock holders jumping for joy and share prices soaring. These days, layoffs push stocks under water as investors see the cuts as a last-ditch attempt to pump up corporate profits amid a global economic slowdown. It's the latest sign that the lagging U.S. economy has rewritten the rules of the stock market.

The shift in the market's response to job cuts stems from the slumping economy. Job losses are accelerating as gains in gross domestic product slow. GDP is a key measure of economic health and recently showed a mere 0.7 percent annual rate gain. That's the slowest growth rate since 1991, when the United States was mired in a recession. Slowing economic growth hinders sales of products, which forces companies to cut back on production. Thus, fewer workers are needed. And, as layoffs continue -- 770,000 job cuts have been announced by U.S. companies in the past six months, according to outplacement firm, Challenger, Gray & Christmas -- consumers become worried they, too, may lose their jobs. They then cut back on spending, cutting into product demand even more.

``Generally, layoffs raise stock prices because they are considered a sign of discipline by management -- that it will be responsive to financial realities,'' said James Walsh, author of ``Rightful Termination,'' which examines hiring and firing strategies. ``But during concern about a general economic slowdown, the effect is reversed. Layoffs signal a struggling economy and show that even responsive management can't avoid the problem.''

Black Blade: Meanwhile the "Bone Pile" grows ever higher and the stench grows ever stronger. This recession could get very bad as investors realize that they are not getting a return on investment or worse - are really losing wealth and worry as their 401K's and IRA's flounder and shrink. They also look about nervously as they see their neighbors, friends, and relatives lose their jobs or have to take lower paying and even menial jobs. They are less inclined to spend and may even save those IRS rebate checks. This will get very "Interesting" before it's all over.

BR549Leigh (msg#: 59372)#5937408/11/01; 12:51:00

"August 19th, the day of the big dollar crash, is a Sunday. How can the dollar crash on a Sunday?"

Perhaps the foreign markets begin trading at 9-10:00 PM for their Monday trading sessions?

LeighBR549#5937508/11/01; 13:08:12

But over in Asia it would already be August 20th. And it would only be a few hours until August 20th here too.

Whoever is putting out this rumor either has the date wrong, or they intend to make this "crash" happen VERY rapidly! Can you imagine all your neighbors waking up Monday and turning on the news to hear the dollar collapsed while they were sleeping?

uponroofAustrailian Miner covering?#5937608/11/01; 14:42:39

From 'The American Advisor': "Barclay's Bank has reported today (Friday) that a very large Austrailian Miner has been buying back it's hedge book".

Wasn't ABX sniffing around down under recently? (Normandy) Could a miner be unloading debt as part of a prearranged deal with ABX? Perhaps Franco Nevada owning 30% of Normandy is involved somehow?


Delta Gold (ASX:DGD) and Goldfields Ltd. (ASX:GLD) have been talking merger lately in an effort to avoid a hostile takeover from the likes of ABX or AU or PDG. Combining assets also allows Delta and Goldfields to persue local miner WMC. The three would then have an annual output of 1.9 mil oz. second only to Normandy who is at 3 mil.

Austrailia is notorious for hedging. If this develops into a trend, as this new merger climate seems to include a mandatory first step 'hedge reduction', I'm all for it. However, it's after the merger is over, and these new conglomerates begin again to 'hedge for profit', that worries me. Could we soon be facing such total control of POG, from these hedged mega producers, that rivals even Central Bankers?

If AU or ABX continues to increase reserves and production capacities, while non hedged producers just hang on, lookout! It will not come down to what the conglomerate's commom shareholders vote and demand, but rather what the conglomerate's political connections demand. Just as hedged producers are now increasing their position in this distressed industry, I suspect their obligations to those in 'friendly' gummint places is also proportionately increasing.

Also, now that the threat of strike is over for 3 more years, can we expect AU to begin eating up South African mines? Let's not forget about PDG, they are cash rich after a very good quarter and have announced they will be on a 'buying spree'.

This reminds me of major league baseball in the early seventies. The players union was, IMHO, ruining the game. The players hearts were corrupted for money. They moved from organization to organization. No loyalty to the people that cultivated them from scratch. I became interested in minor league and college ball instead. The corruption had not yet permeated those levels. Perhaps, in comparison, we have exploration and pennys to keep our interest as the majors appear they may be changing hats much more often.

lamprey_65Dollar Crash Date#5937708/11/01; 14:50:59

As we saw this past week with the prediction of a Tuesday crash with the productivity numbers, I'd be careful of those calling for things to happen on a specific timetable. However, from the above link:

"More than likely one day here soon, the dollar will snap badly overnight, and the orders to sell US stocks and bonds will pile up from foreigners even before New York rolls out of bed, and it will just be a matter of assessing the damage and trying to figure out where all this stuff opens up."

NetkingAu/Ag - Commodities Bull of the 00's#5937808/11/01; 15:17:33

The above link by Adam Hamilton is worth a serious read(again).

Adam like many other analysts has wisdom, but his market timimg is more pronounced, logical & factual (IMHO)than some of the contrary analysts.

It's all good . . . the signs are that Platinum may have been the first cab off the rank, with the others (Au/Ag etc)to follow.(IMVHO) - Netking

BR549The Dollar Crash#5937908/11/01; 17:44:43

I think that most of my neighbors, especially SOME of the ones across the river (definitely not all), will never wake up.

My investment philosophy: I tend to buy gold on rumors (usually high) and sell never (or when the economy crashes, whichever comes first). I also heard Tuesday (not Monday) for the crash based upon what the Russian's were going to do to the dollar.

Can't wait to see what happens.

NetkingEgypt threatens show of armed force to aid Arafat #5938008/11/01; 18:36:18

Snippit from The Sunday-Times:
The threat of a wider Middle East conflict is growing as the Egyptian government considers sending its 3rd Armoured Army into the Sinai peninsula if Israel moves into Palestinian territories.

justamereBearLeigh 59375 Black Blade Fuel cells#5938108/11/01; 18:52:28

I have not been following any news, so I don't know much about this rumor, just what I infer from todays postings here.

I have long posited that there WILL be a dollar crash, and that it will be blindingly fast.

However anyone who predicts specifics, such as a date are smoking the strange stuff IMHO. False rumors invariably make specific forecasts such as dates, or by how much a particular stock will go up, to make them more authoritive, and thus more believable. Sometimes there is enough belief that it actually happens. [In 1929 (early) for example].
It is my opinion that one individual, or even one country does not have the wherewithall to manipulate the USD against the wishes of the US. There is nobody quite large enough. One incident or country, or whatever, may be enough to TRIGGER a chain reaction, whereby enough others find belief, and now the US has a problem. I do think the fundamentals are in place for a USD crash, so Aug. whatever is a possibility, but not very likely, again IMHO. Personally, I am fearful of the period of Sept 8 to Nov. 11 or 12, and again from Feb 15 to Mar 15, both for a USD crash, and particularly the former for a stock market crash.

Black Blade--Fuel cells
There is some interesting work going on in pure hydrogen. Of course the fuel cells convert the nat. gas to pure H2 by stripping off the carbon molecule and dumping it, then feeding the resulting H2 to the fuel cell, which creates H2O as a byproduct. But that is like the core rate of inflation.The stripping of carbon happens in the converter, not the fuel cell. Nobody seems to mention what happens to the carbon. Our environmental friends seem to be asleep at the switch here. Hydrogen does have its' problems, principally the current cost and methods of obtaining it and transporting it. Some neat solutions appear on the horizon, but a mass solution, not in my time I think.


Tree in the Forestauspec, Leigh#5938208/11/01; 18:58:44

auspec: Your post # 59367 was quite correct and your characterization of Weiss/Edelson also good based on my own experiences with them.

Leigh: The August 19 date that I heard was a Russian projection based presumably on Steve Puetz/Chris Carolan solar/lunar eclipse calculations. The propensity for crashes to cluster around eclipses seems to be strong based on their research. However, these dates don't always produce crashes and the dates are usually plus or minus several days. So it's just a marker. Still, Euro markets open several hours before ours and it's just possible that by the time our markets open Monday AM the 20th, a dollar drop will be a fait accompli. TPTB likes to have several things going for them when when they want to move a market and Carolan's research is well known. It stands to reason that they would want "the stars" moving in their favor as well as a war etc.

auspecTIF/ Spiral Calender#5938308/11/01; 19:44:23

Yes, Chris Carolan's work based on his Spiral Calender is most fascinating. I studied him very closely for a few years, but found no good way to make more FRNs from the predictions. Have you followed this work a bit and or read his book?
You are exactly right, he is simply looking for turning periods where we can gain insight into market 'CHANGES', so the time period is frequently a few days before extending a few days after this LUNAR related event. It can be an eclipse or a full or new moon if my memory serves me that often accompanies/causes the change in a market. I found the work to be somewhat hit and miss, which is not exactly a criticism because we are well into the realm of 'art' combined with math/science. He knows he will miss many events, but he also knows many will fall his way. I have not followed him for 3 to 4 years likely so I don't know the upcoming dates to look for changes in the precious metals markets. If anyone has this info would greatly appreciate learning these dates. Apparently the US Dollar is approaching a window of change. So in general we would look for a sharp break in the $ somewhere between Aug 17 and Aug 21. The dollar breaking upward during this period would project a different outcome. I have a hard time believing the Ruskies are basing their $ drop on this Carolan research, it is so esoteric and so little understood. I gave up the newsletter because it was expensive, I didn't find a trading mechanism with which to make money off the advice, and ran out of patience when the gold/silver windows failed to materialize a bull market. It was certainly not because the work was not fascinating and credible.
Few of us realize the effects on the human emotion/psyche/physical being that the moon phases cause. Crime rates, birth rates and many other human factors are lunarly influenced.
Watch for the lunaticks or be a lunatic!
This moons for you!

auspecFOA & Gold Mobilization#5938408/11/01; 20:31:00

From the trail 8-6-01:

I am sure most Americans are uncomfortable at the prospect of our stores of Political Gold being shipped off to defend the dollar. Uncomfortable as this may be, unprecedented it is not. During most of the years of an active Gold Exchange Standard gold was routinely "shipped off" from nation to nation to satisfy foreign demands. Not just entirely to defend our dollar's value; the aim of these operations was, then and now, more so to keep the dollar in settlement use.

Yes, the dollar's continued use for trade settlement and the defense of that valued use was always the aim of these gold trades; but even below this is a deeper meaning to this function.


From a dollar point of view, shipping gold then, and now, was in the same context of defending one's currency on the exchange market. In the context of this use; gold was not sold as a commodity, rather it is clearly traded as an officially earmarked "good" that can further support the
"tender status" of internationally held dollars.

The psychology of "gold exchange" is more manifest in our "legal tender" function than most strive to understand. Standing aside, for a moment, from our previous discussions concerning modern fiat demand's impact on the dollars recent value; we look more closely at the logic of this "tender"


Local dollar currency, circulating within US borders, is given political value because of it's legal tender designation. Dollars outside our domain, while often sharing the same trading value, are not covered by that law. Even though, through protocol they are commonly accepted, they are not legal tradable money; unless they re-enter the US again.

The process of defending the dollar by shipping gold is, today as much as yesterday, an expression of maintaining political "Legal Tender" status for international clientele. Indeed, as an ongoing trade deficit in the US has become irreversibly structural to the integrity of the local economy and remained in this function for many years; the legal tender function of foreign dollar reserves comes
very much into question. It begs this suggestion: does the international dollar have any internal political force backing it's value overseas? This question can only be addressed by shipping gold in a legal "currency defending" process. END

Comments: Yes, of course, the US$ must be defended, both at home and abroad. So the US is reallocating/giving away gold to keep the US$ "in settlement use". My first thoughts are 'Western' as is my wont, "That's a little bit of gold to cover a lot of dollars outside the US." But then I look inside my yang organs and find that maybe this gold reallocated is worth considerably more than the Western paper POG of $275, certainly worth a large multiple of the oficially classified price of $42.
GATA clearly recognizes the link between the manipulated POG and the US$, the strong dollar facade and all its inherent implications and 'benefits' for US markets. I'm looking for quantification again. This time between the out of country Dollars and the relative value of somewhere near 1800 tonnes of gold, the amount that has been put up on the trading {traded} block. Can this 'minor' amount of gold reasonably bribe foreign holders of dollars to keep holding them and keep settling trade in dollars? Anyone? Who are these particular holders of dollars that can, for now, be bought off? *Middle East*? Japanese? Chinese? How long will 1800 tonnes last the dollar faction?
Gold is not supposed to be dealt w/o Congressional approval. Maybe that was when the Constitution had a country.

annieFull Moons#5938508/11/01; 20:34:11

I knew a nurse who had worked in many nursing home environments. She said that when there was a full moon that the alzheimers patients, etc., were moved to pace the halls.

All I know is that if I, as an ancient had been told that the moon caused the tide to come in and go out, I would have just about hee hawed at that notion.

This is my first post here.

All, take care. annie

Cavan ManAuspec#5938608/11/01; 20:43:09

I think, while the game is good, there is no reason to go to the window and cash in your chips.
auspecIntroducing annie#5938708/11/01; 21:02:45

Folks at USAG Forum, this is my good friend annie. Annie, these are my esteemed colleagues {whom I have never met} at this establishment. Please give annie a warm welcome!
A few hints--- She is very good with the questions and is a quick study, and a most worthy addition. Like most of us, she doesn't mind a touch of encouragement here and there.
Question? Is pacing the halls diagnostic for Alzheimers?
Welcome annie!

auspecCM#5938808/11/01; 21:06:28

Yes, it has been quite the game!
Cavan ManHello annie#5938908/11/01; 21:07:17

I know what you mean about moons. Everytime we have a full moon here I have this tremendous urge to go out on the patio and sing "My Wild Irish Rose" in the middle of the night. My neighbors are grateful I just brew a cup of herbal tea instead and go back to bed. You see, I'm a baritone and the song requires a tenor. Welcome annie.
Cavan Manauspec#5939008/11/01; 21:09:39

I have the most patient and understanding wife in the whole world. However, her patience is wearing thin. I'm hoping I can hold out till the end. I truly think it is starting to break up.
annieThanks for the welcome#5939108/11/01; 21:19:02

Auspec, thanks for the introduction. and CM, thanks for the welcome. I will try to lurk without outbursts, but tend toward the impetuous. I have occasionally visited the site and been impressed at the quality of the posts here. I expect to learn a lot and will do my best to contribute what I can when I can. I hope that there is some latitude with "off-topic" posts because I'm an artist and I rarely get anywhere directly. I just appreciate the opportunity to experience the comraderie of a site such as this.

Take care, All. annie

Solomon Weaver(No Subject)#5939208/11/01; 21:40:13

Hello Annie

From Alamosa and Poor old Solomon

Hill Billy Mitchellannie @ # 59385#5939308/11/01; 21:59:58

Welcome annie

Are you an accumulator?

Friends like auspec are not that easy to come by. Please feel free to speak your mind. If you do not it will be our loss. We look forward to your posts.

Very respectfully,


Hill Billy MitchellCavan Man @ # 59390#5939408/11/01; 22:13:05

Sir Cavan Man

Just today I told my wife that I hoped that gold and silver would go up slowly. She said, "Not me, I hope it goes up soon and fast and gets it over with".

It is a sign of her impatience with the waiting game. Also we will continue to accumulate until gold and silver become over valued and she is a little wearied of taking every penny of our excess above necessitite and putting it into silver and gold. She thinks to sell when we can double our cost of accumulation. Not to worry. I know that she will not sell without a push from me. I only hope I can give her the push.

Please note that we are not talking about 30% of our accumulation, which will never be sold. When you have all your eggs in one basket, as we have, it would be crazy not to convert the 70% or so. What think you?

Very respectfully,


BR549Did you say hee hawed? & auspec#5939508/11/01; 22:32:08

annie (: #59385)
"All I know is that if I, as an ancient had been told that the moon caused the tide to come in and go out, I would have just about hee hawed at that notion."

I haven't been here very long myself. Welcome. IMHO, this is both a stimulating and fun site.

auspec (#: 59383)
You made me feel welcome on my first post here also and I still appreciate it.

My earlier reference to the Russians bustin' the dollar did not have anything to do with Spiral Calendar's but more to do with their impending announcement to the Russian people about trading hoarded FRN's for their new value-based gold coins. The timing is always suspect because if anybody other than the PTB know about it, the market usually has already discounted it.

In re: to your #: 59384, I agree almost 100%. With the exception that I am not sure that most Americans are aware that Gold is being shipped off to defend the dollar or even care. It is the few of us that do know what is going on that need to start making noise. If the Feds are indeed giving away our gold, (according to their published stat's, they are not), then it's time to follow GATA's advice. Look at Argentina's depleted gold treasury and the demise of their currency as proof that modern currencies can collapse under their own corruption.

I have enjoyed your posts both here and other places and maybe need to look at this Spiral Calendar since we are talking what is going to happen in the future. Do you have a link for additional information on this?

NetkingAnnie#5939608/11/01; 23:03:26

Bon jour, Guten tag, Kham Cho, Namasie & Welcome Annie! . . . to this, the most golden place under the sun.
Buena FeCheers#5939708/11/01; 23:08:08

Hello fellow Pioneers, just stopped in for a quick check of the SPEL (sociopoliticaleconomiclandscape). No better place than the halls of USAF and the AuT.

Isreal really stoked up the embers with this latest move (Orient House), even more than if they had killed several Hamas leaders. As the Word states ...... "Jerusalem shall be a stumbling block to them". No peace til after a short war (about ten days), and then only a short peace at that.

TG has really started to clearly define the trail. When does oil seek Euro settlement??? Must be soon, Mexico cozy with S.A. last week. Dollar's days are numbered, a very dynamic/non-static situation, no one probably really knows how this is exactly going to fall out. (Au=opportunity)

GW seems wilfully detached from the Washington/Wall Street artery, unlike Clinton, maybe he knows their goose is cooked and has decided to distance himself from the fiery test about to be unleashed upon the money changers!

Appreciated the comments about some of your spouses. This has been a difficult road to travel ........ For encouragement study the lives of Mr. Merrill and Mr. Babson, circa 1929. Both contrarians through a mania, almost drove them crazy to see the world so differently then the majority of their peers, only to prosper substantially after the break got underway. Somebody needs to be around to understand the new world after the break. Somebody with a lot of common sense/compassion/wisdom, like the posters at USAF et al.

Welcome Annie

Best Regards

Black BladeWill hedge funds become a nightmare on Wall Street? #5939808/11/01; 23:20:00,2276,17383,00.html?


HEDGE funds were blamed by some as being agents of Asia's 1997 currency crisis. And so great was the outrage in some quarters, such as Malaysia, that governments and multilateral institutions banded together to devise controls over their activities. The currency hedge funds are now largely a spent force. But could it be that they are coming back in a new and equally virulent form to destabilise international equity markets? Some think so. And they feel that investors should be aware of what is going on.

'In 1999 and 2000, hedge funds encouraged the US equity market to rise to ridiculous levels of valuation. Then, 'in 2000 and 2001, they caused the valuation of several large-cap technology firms to explode'. After that, in April and May this year, short-covering by hedge funds ''caused many equities to rally despite an absence of any change in fundamental news about profits and orders'. This is reminiscent of what happened in the currency markets four or five years ago when hedge fund activity was blamed by some for wild gyrations in exchange rates in the absence of other underlying causes for such volatility. Of course, we all know that hedge funds helped wreak havoc in the so-called emerging markets in 1997. But they also played a major role in an earlier crisis - the 1992 attack on the British pound that led to its ignominious exit from Europe's then Exchange Rate Mechanism.

Black Blade: Not a word about the hedge fund role in the Gold Carry Trade, however, these hedge funds have their finger-prints all over the place. Who needs the Working Groups on Financial markets (aka PPT) when hedge funds can move markets with a slight nudge.

Canuck@ BB#5939908/12/01; 06:04:26

Thank you sir for your response 59369.

I believe we are on parallel planes. In addition to one very selection energy trust I added a small position into a 'retirement residence' REIT.

There were several interesting articles in the Globe and Mail this week-end. The CEO of a major was concerned about future gas production citing the increasing rig count and lack of proportional production; echoing your comments to a tee.

I am a relative 'newbie' to the energy crisis phenomona but in talking to friends and relatives it is absolutely amazing how shallow their thinking is. Most (energy) conversations circle around the high prices for a couple minutes and then its back to Aunt Marys' eye surgery and Betty Sues' new baby. Most of these people open a paper and zoom in on the sports, the horiscopes and the obitruaries(sp?).

My best friend (computer nerd) has his 'start-up' following the search for extra-terrestrial life. He explains in great detail that a mirror image of earth is in some distant galaxy, I ask him if he is looking for his home planet! He got into a fierce marital squabble about 2 years ago and I told him to take a couple bucks from his paycheck and buy silver, hide it somewhere. He told me that he didn't like 'hiding things from his wife'. I asked him if he thought she would be doing the same. So last fall they got divorced and after 6 months of 'dormancy' she bought a house and he holds the new golf clubs, the membership, the lease of the car, etc., etc. She's an old high school buddy so I went out to see the house a month ago. Her brother is a 'financial planner' and he had mentioned the uptick in gold funds and so she me asked about purchasing gold. He didn't buy an ounce of silver and she's buying houses and gold. Recently, I told my buddy about his ex-wifes' stellar 'money management. He shrugged his shoulders and promptly informed me that he 'broke 90' and continued with a shot-by-shot analysis. The conversation quickly drifted into golf and Formula-1 and after a couple beers I asked him if he had found 'earth'. The two of us grinned at each other and he blurted, "I think so, apparently its' loaded with gold, wanna go?" I gave him a high five and we cracked another beer.

What do you do with a clown like that?

Cavan ManHill Billy Mitchell#5940008/12/01; 07:50:43

My opinion is that there will be time enough to own other asset classes. The time to own gold is now; right now. I know very little about silver so I cannot offer an opinion. PS22: 1-21 (Amazing Grace)
BR549Eliminating Risk#5940108/12/01; 10:41:20

Black Blade (msg#: 59398)

Hedge funds, derivatives, futures contracts, puts, calls, although all different in their form have one thing in common-the elimination of risk. Basics of investing 101-the higher the risk, the greater the return and vice versa under normal unfettered supply and demand.

Take huge amounts of capital with low rates of return and eliminate the risk-- result huge amounts of profits. The banksters currently do not have to show derivatives on their balance sheets. The most frightening aspect of the largest of the hedge funds and all of the banksters risky no lose investment strategies, is that even if they do fail, the Fed stands ready willing and able to bail them out with taxpayer funds.

Of course if they all fail at once…..

Sierra MadreAbout DERIVATIVES.....#5940208/12/01; 10:50:55

Let's get this straight:

Derivatives DO NOT "eliminate" risk. They TRANSFER risk.

Some entity has to assume the transferred risk. And even Insurance Companies go broke now and then.

It seems to me that the derivatives spider web holding up the world economy is a very fragile thing and if it should begin to break down, not even the Fed would know where to start to shore up this extremely complicated network.

The world might find itself in a total shambles in a matter of hours or days, if the derivatives network begins to fail.


BR549Derivatives and other hedges#5940308/12/01; 11:09:42

Sierra Madre

You are correct sir! What I should have said is "eliminate risk" from specific investment positions by transferring the risk to some other entity.

The Feds are obligated to bail out the banksters so they would start there.

Where it would end up? That's the point—the world's house of financial cards would tumble. My individual hedge fund against FRN's—own physical gold and silver.

TannehillGold or silver, decisions - decisions, oh my#5940408/12/01; 11:15:14

OPEC finally figured out oil derviatives and the paper barrels they created, then took oil from $18/barrel to $10 and back to $30. Me thinks they have also figured out how the bankers have bambozzled them with paper gold/derviatives, but they have no desire to push up the price of gold until they get physical delivery for all the paper ounces they have been promised. Why ruin a good thing?
If information is the new wealth of this high tech world, then just like everyone knows that the world is running out of oil, the flip side is also true, the world is running out of "physical" gold.

Let's see, 6 billion people --- 4 billion ounces of gold. Let's hope some of these people really believe that gold is a barbaric relic and has no wealth effect.

That's all from Tannehill

Gold Trail UpdateThe Gold Trail Discussion has been Updated#5940508/12/01; 11:16:51">The Gold Trail Discussion has been updated. Click on the link to read the latest updates.
slingshotSign of the Times. Observation#5940608/12/01; 11:21:27

In my neck of the woods, there has been an increase in construction of large shopping centers. Super stores and major grocery chains with the usual outlet stores with special products.
The thing that caught my eye was each shopping center has a PAWN SHOP. A few years back I do not remember seeing so many of them. Now, they are everywhere. Possible connection to the Forbes body count?
Steak tonight Honey? Lets see, Chainsaw and powerdrill should cover it.
The time to look at gold is staring us in the face!

escapethematrixDecision day= October 9, 2001....#5940708/12/01; 11:22:09


Judge Lindsay has scheduled a hearing on the defendants' motions to dismiss for Tuesday, October 9, at 3:30 p.m. The underlying issue in that proceeding is whether the Constitution and laws of the United States may be enforced in a federal court action challenging the authority of Mr. Summers and other American officials, working at least in part through the Bank for International Settlements, to conduct the surreptitious and illegal gold price-fixing operations exposed even by his own academic research.

An interesting read about Mr. Summers and Gold....Check it out.

uponroofSlowly I turn....step by step....inch by inch....#5940808/12/01; 11:31:54

Thee above words made famous by none other than Curley of The Three Stodges....

Hope all are having a nice weekend,

First off, greetings annie-nice to see more women involved in PM discussions.

If you are a 'good friend' of auspec it's a good idea to include PM's into your life before 'tying the knot'. After tying the knot it's funny how PM's become as nasty as PMS between husband and wife. Don't know if I'm way off in my assessment of your situation, and am probably projecting way too much, but speaking from experience, men will always love PM's. Women seem to be less tolerant of the never ending trials and can develope PM's PMS. Please forgive me if this is not applicable to your situation, not intended to be critical. However, those of you out there who this does apply to...."I feel your pain". Nuff said.

It's Sunday.

I get the Sunday paper here in the Philly area and today there was, as usual, a 'PARADE' magazine insert. PARADE magazine is an insert which is included in 350 Sunday newspapers all over the nation. It is read by 80 million Americans and is the typical staple of America's 'new bourgeoisie'.

This cute little magazine has the mandatory gossip page on the latest Hollywood scandels, a 'Dear Abby section (Ask Marilyn) and similar shallow information that is the backbone of our society's information today. My point is that this rag is most likely finding it's way into the reading rooms (bathrooms) and minds of thos 80 million Americans.

Well the cover story this week is titled "WHAT YOU NEED TO KNOW ABOUT TODAY'S ECONOMY". Keeping in style, this is a very simple piece that is in a question and answer format. Some of the questions and answers however may surprise you. Here's a few examples:

Q: Are we still in danger of a recession?
A: Yes, and for anybody that's been laid off we are already in one.....

Q: How much trust should we place in economic forcast anyway?
A: Very little.

Q: So what should we keep in mind about forecasts?
A: That you can't 'time the market'. If economists and Wall Street pros don't know which way stocks or interest rates are headed-and they don't-then how can you?.....

Q: Will the California energy crisis hurt the economy?
A: Yes, especially if it spreads. Having workers sitting idle or missing delivery dates due to blackouts makes us less efficient. Inefficiency impoverishes us all.

Q: Should I hold onto my tech stocks?
A: It's nuts for most people to to try to pick specific stocks, let alone tech stocks. Look how badly the pros did it. Why would you or I do better? So consider selling stocks on which you can take a tax loss....

That's only a few of the tidbits being absorbed today by your neighbors. Some of the others are less bearish, but the overall flavor of this is as outlined above.

btw- "Casino" is a word used in this more than a few times. All in all a very sobering piece that will certainly open some eyes. Keep in mind, those who frequent here and other responsible financial sites are lightyears ahead of most ordinary "investors".

Of course we sometimes lean too far to the extreme in what lies ahead, but so far our dismal forcasts are closer to the truth than the inverse paper loving prognosticators who shamelessly 'hold (investor's) hands' all day long on CNBC and the like.

This Sunday paper insert is a guage of what the mainstream sentiment is becomming....closer to our point of view my friends (inch by inch).

Black BladeRE: Canuck#5940908/12/01; 11:35:48

There are those who look to the past, those who look at the present, and those who look to the future. For most people ignorance is bliss. If they do don't concern themselves with the world around them, then just maybe the problems will "go away." The governing officials and bureaucrats of Kalifornia knew that the energy grid and power production was inadequate and yet they just hoped that the problem would "go away." I have referred to this as the "Ostrich Syndrome" in some past posts. That is why your friends and relatives try to ignore the important problems and focus on more pleasant issues. I have friends who are the same as you describe. I recently went to the Sturgis rally and met with some friends from Kalifornia and they reacted the same way when we discussed the energy crisis for about 2 minutes, then the conversation drifted to other mundane issues. That is the difference between the "Grasshopper" and the "Ant." The Ant enjoys life while he prepares for potential problems and the Grasshopper plays all summer in blissful ignorance. Problem is - Winter is coming. Cheers!

- Black Blade

Mr Greshamuponroof#5941008/12/01; 11:44:20

...or was it Lou Costello, of Abbott & Costello? "Ni - agara Falls"

(i'm trying to keep up with the reading, honest, but it's summer, i'm tired -- and relaxed -- and nary a golden thought has passed through my head -- for weeks! call it a vacation if you will -- there's definitely a vacancy somewhere)

But FOA's had some great stuff, I'm printing and re-reading, outside in the hammock. Where's Oro been? Relaxing, too, I hope -- things could get exciting pretty soon, and we'll need him on board to help understanding things as they pop...

annieYou guys have been Busy!!!#5941108/12/01; 11:53:50

Good Morning! I see some of you have been up for hours.

Thanks to Alamosa and Ol' Solomon, Buena Fe, Netking, HBM, BR549, and others who have welcomed me here. I have not read today's posts yet, but I wanted to comment on one theme from yesterday.

Not until this past week had I considered that one holding gold should, perhaps, sell some of that gold on a precipitous rise.

I have become quite paranoid that "holding gold" after the "crash" could be detrimental to one's well-being. Those who have sacrificed the "pleasures of the moment" in order to provide security once the brown hits the fan, may have jack-booted thugs at their door.

Anybody else here share that paranoia? Will the FBI or whoever be tracking down those that hold gold. Will they be pouring through these archives looking us up?

On a purely hypothetical basis, I would definitely think that selling some gold would be wise. If we do go into something of a "non-economy", we would want to be as "comfortable" as reasonably possible. For instance, if we anticipate needing to grow vegetables, would it not be wise to take some gold profits and purchase a roto-tiller? And maybe some canned peaches and nitrogen packaged foods?

I would think that it would not be advisable to try to use gold in barters for quite sometime to see how things "shake out".

Thanks again for the welcome. And, yes. I do appreciate the kind regards of auspec. Thank you, sir.


auspec@ BR549#5941208/12/01; 11:54:05

As far as your "..I'm not sure that most Americans are aware that Gold is being shipped off to defend the Dollar or even care."
We are in total agreement here also. I seem to accumulate memberships in groups that are tiny but very vocal. It is quite surprising what can be accomplished with some real persistence. Having truth on your side is, of course, the key.
If you are interested in Chris Carolan's "The Spiral Calender" {and its effects on financial markets and human events, the book itself is the best starting place. I have no link to give you but know it is available through Elliott Wave International, Gainesville Georgia if not through regular bookstores. You can always ask for a newsletter sample.

Annie- There is mathematical info in this book as it relates to art and nature and then applied to the markets over time using the lunar calender as marking points. Can you spell e-s-o-t-e-r-i-c-?

auspecuponroof#5941308/12/01; 12:03:39

Thanks for feeling our pain {cramping}, but annie and I are cyberspace friends from afar. I do know what you mean about a spouse getting a bit tired of all this gold and silver stuff, but I solved the issue about 2 years ago. I just simply agreed to work forever if things don't work out the way planned/invested. Don't try this at home!

uponroofMr Gresham#5941408/12/01; 12:07:42

That's it....."NI - AGRA FALLS!....Slowly I turn, step..."

Thanks for the clarification. I believe both did a version of the routine, Abbott and Costello and the Stooges.

Annie and auspec please ignore my post regarding the two of you today. I was under the impression that you were a couple, more intimate than mere cyber friends. Sorry.

BR549The Spiral Calendar #5941508/12/01; 12:22:01


Is this it? If so, I'll have my Sunday reading taken care of.

slingshotAnnie#5941608/12/01; 12:32:31

Just happen to come across this forum by accident about this past January. Since then I have learned plenty and still have more to go. I am not a financial wizard on any account, but reading the posts here has helped me understand the markets. As for Gold, we may think the same. I believe we are near the bottom. Even if it dropped more I Still would buy. I use cost averaging. Remember the Gold is no good till you use it. Have a GOAL FOR YOUR GOLD! Pay off the house. Buy a New Car. Guess its RIGHT TIME,RIGHT PLACE.
Fiat to silver, convert to gold, Pay off house. Kind of a time line. How fast you convert might be a problem.
Far as holding some on the side. If all Bejebies breaks loose, they will not be looking for the gold. They will have their hands full elsewhere. Heck, if they did you should have your goals accomplished already and whats left,Eh.
Annie, I'm not going to get rich, but I will be positioned better for hard times.

Black BladeRE: uponroof and Mr. Gresham#5941708/12/01; 13:10:48

Nyuk, Nyuk, Nyuk.
annieuponroof#5941808/12/01; 13:11:00

First, just to clarify, I use the term "guys" for male/female. It substitutes for "y'all" since southerners have been given a bad name--unjustly--for supposedly using "y'all" in the singular. Dumb, eh. Anyway, I prefer the more grammatically acceptable, "Youse guyz", shortened to guys.

Okay. Thanks for the welcome, uponroof, your advice would be good if auspec and I were tying the ol' knot.

BTW, auspec, I have returned the form your attorney wanted me to sign saying we were just cyberfriends. (smile)

I may not be the typical female because of my "Little Red Hen" syndrome. While Slingshot says: "Remember the Gold is no good till you use it", in my own case, I disagree with that. Gold provides a nice backdrop for my other forms of security: seeds and learning to garden; stored foods; well and generator; etc. Most people in our society--outside of these gold forums--take security for granted. It is one reason that "they" don't like to hear what we have to say. It's pretty damn disturbing. Oops. Can I say that here?

Sierra Madre and BR549: I like the way you two work together: Derivatives DO NOT "eliminate" risk. They TRANSFER risk.

auspec: Yes. esoteric. Do you think somebody needs to make up a definition for it, or just use the one in the dictionary? (smile)

I've stayed here much too long. Studio beckons. Grunt work awaits. BBML

Black BladeFuture FED Reserve Governors?#5941908/12/01; 13:15:43

Nyuk, Nyuk, Nyuk - arf-arf-arf!
NetkingAn another one . . .#5942008/12/01; 13:36:58

Haifa Sunday Night)-Suicide bombing injures at least 20.
Black Blade60,000 jobs awaiting Saudis in gold sector#5942108/12/01; 13:38:57


According to latest statistics, there are 6,000 shops, 350 factories and hundreds of workshops employing more than 60,000 workers in the gold industry. Saudi Arabia is the fourth largest gold market in the world, with annual sales amounting to SR8 billion and an annual demand estimated at 200 tons. Jewelry shops in different parts of the Kingdom have been shut down for not recruiting trained Saudis. At Taiba, Owais and Qasman shopping centers in Riyadh, 107 shops have been closed down during the past few days. "These closures have increased sales at 40 shops at Taiba and Owais shopping centers by 200 percent," traders told Arab News.

Black Blade: Sure is a lot of concern over a "Barbarous Relic."

uponroofChairman Curley#5942208/12/01; 13:43:44

Black Blade....thanks for the memories

The Stooges will always have a place in my heart. Spent countless cildhood afternoons on the floor in front of the TV watching the likes of Sally Star, Bertie the Bunyip, Ramar of the Jungle, Clutch Cargo, Our Gang, etc, etc,... but The Stooges were always the best....and of course, Curley was the best of the best.

Love to see him testifying before Congress with Moe and Larry sitting behind him, as councel, providing the occassional slap to the back of the head. Can't you hear Rep Henry Waxman or Barney Frank trying to get a straight answer out of him regarding the economy? "Nyuk Nyuk Nyuk, arf! arf! arf!"'s out of my system now. sorry

Black BladeRE: uponroof - Chairman Curly#5942308/12/01; 13:54:54

That's funny just thinking about it! What a contrast to the AG's meaningless mumblings. Thanks!

- Black Blade

BR5493 stooges#5942408/12/01; 14:08:00

I love 'em. Ever known a woman that really likes the 3 stooges? And you never will.
Mr GreshamBR549#5942508/12/01; 14:16:58

Nyuk, nyuk, nyuk! (="Amen, brother")
CoBra(too)What a Day!#5942608/12/01; 14:37:20

First of all my warmest welcome too, to you, Annie! The artisan and juggler of words - creating a scenario of value with the same easy stroke of words as with your paint-brush. Please, Annie feel free to take up your seat on the round table - maybe across from Leigh - as we olden guyz would offer thee any place you would preferably occuppy (same goes for Phil, if he cares to row across the river, from time to time).
Our good friend Auspec, CM and many others have already been charmed by your arrival and as I've never seen such a warm welcome for anyone - I do suspect your contribitions speak of your artistic intellect, and more!

Lamprey 65 and Sierra Madre had been hacking away at hedge funds and leverage, supposed to ameliorate any, if not all risk in the financial casinos, formerly known as capital markets. I have to totally concur, as I've said before even the recently founded leveraged risk 'co-operative' (known as counterparty risk group, a co-op of the main BB's) will ultimately find no market to offload their (a-)cumulated idiocy - except the already maxxed out tax payer... holding the bag, again ... if he can!

MK - great synopsis on the trail - thank you!
Would like to comment on some points, though will have to postpone, due to some pressing bus(y)iness.

Kind regards to all - cb2

auspecBR549iral Calender#5942708/12/01; 14:51:53

You found it! Will love to hear of upcoming 'turning points' for gold/silver if you ever stumble across them.
auspecannie#5942808/12/01; 14:54:13

Hope you signed that form, it is what can be called an e-nuptial {smile}.
Best to you

BR549What a Day!#5942908/12/01; 15:16:27


Rumor is this "Phil" guy has been crossing the river for several weeks under a new identity and crossing back. When swimming over to this great land the last time, he noticed no others crossing in the opposite direction. After much contemplation and hand wringing thought, he hopes to immigrate here permanently as the style of life here is much more to his liking.

The people are friendly here, they are funnier "yuk, yuk yuk" "whoop", "whoop" "whoop", and the natives on this side of the river are very knowledgeable about PM's and schooled in the science and technology of "what's happening now in the economy." The links are fantastic.

Enough of this Bob Dole style third person stuff: Sorry, for not fessin’ up earlier, so please forgive me, especially my good friends Leigh, auspec, cb2, and many, many others for whom that I have tremendous amount of respect for their ideas and postings.

The air is clean, the sun is shining, and as Travis Tritt, says "It's a good day in the neighborhood….."

BR549What a Day!#5943008/12/01; 15:23:27

Make that "It's a GREAT day in the neighborhood!"
auspecBR549#5943108/12/01; 15:28:17

OK, Phil, now that you're up to a confession, what is the significance of BR549? We probably also ought to get your response to uponroof's message #59408 about the not-tying!
Did I ever tell you how I walked across the Colorado River as a kid?
Welcome again, you rascal.

Gold-- {That's for any site monitoring by the house, smile}

Buena Fespec#5943208/12/01; 15:31:19

The resturant that the IJ bombed in Haifa today was named "Wall Street" ....... is this an omen?
Chris PowellHow Summers learned that as treasury secretary he'd need to rig gold#5943308/12/01; 15:31:22

Reg Howe's latest shows how Professor
Summers' academic writing about gold
prepared the way for the Clinton
administration's gold-rigging policy.

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

This email address is being protected from spambots. You need JavaScript enabled to view it.

Buena Feoops#5943408/12/01; 15:34:22

front page picture
CoBra(too)Paradoxon or (Oxy-) Moron?#5943508/12/01; 15:53:06

@ BR549 - yuk, yuk, yuk or better tsk, tsk, tsk - could'a should'ave known the style. Thanks for lifting the veil, as I wanted to say hi all the way ... was only shy to express my gratitude to you some time ago - taking openly my side! Thank you - very couragous and chivalrous of you!

Just had the opportunity to chat with Bill Murphy, what a great team he's assembled and will instantly try to digest the latest dispatches concerning 'Summers' a la' Gibsons Paradox and more to come.

Reminds me of a veteran Wall Street friend, who paradoxically is a goldbug, stating that Prof. Summers and Prof. Rudi Dornbush are training a generation of Harvard elitist economists on their own paradoxon! Son of a gun ... seems almost impossible for a chameleon or is it an oxymoron, or just a plain moron? Well, I'll be gone - see u soon cb2

BR549PM's vs. PMS#5943608/12/01; 16:15:23

auspec (59431)

auspec and uponroof---

By the way there are many others on the other side of the river whom I respect including the owners. You know who you are over there and believe me I don't intentionally paint with broad brush strokes. I respect even those whom I disagree with, on both sides of the river and will continue to question terms and definitions that I can't define so I can learn something.

BR549 has to do with the farmer's plight. The price of food is manipulated to the detriment of family farms and to the advantage of big agribusiness. When family farmers continue to no longer exist, this country is then permanently doomed. Much the same as to what happens to ticket prices when major airliners absorb their competition. In my opinion commodity trading at the CBOT has nothing to do with small farmers. Small farmers can jump in and hedge the price of their December wheat to lock in some of their declining profits, if they knew how, but if they can't pay the rapidly escalating taxes on their land or have a bad year or two, the banksters end up owning it. Critics of farmers wonder why there are government subsidies to not plant crops, etc. The farmers would be fine if their goods could be sold on the world market at market prices unfettered by supply & demand and with a weak (instead of a strong dollar). Plus LuLu and I have something going on.

Re: uponroof: "If you are a 'good friend' of auspec it's a good idea to include PM's into your life before 'tying the knot'. After tying the knot it's funny how PM's become as nasty as PMS between husband and wife. Don't know if I'm way off in my assessment of your situation, and am probably projecting way too much, but speaking from experience, men will always love PM's. Women seem to be less tolerant of the never ending trials and can develope PM's PMS. Please forgive me if this is not applicable to your situation, not intended to be critical. However, those of you out there who this does apply to...."I feel your pain". Nuff said."

I'm not sure about the correlation between PM's and PMS but I know that my mate and I are in complete agreement about the ownership of PM's, and hoarding of food, water, seeds, etc. There is absolutely no conflict. So I'm just lucky I guess. As to PMS, the only thing I heard about that-- is the reason that it was named PMS. Ans: The name "Mad cow disease" was already taken. Better go find a place to hide now.

PS: Decided I had better cross over here to keep an eye on her. I didn't know about you two. (Ha!)

auspecSteve Saville & US$#5943708/12/01; 16:16:35

From article at GE:
"Once the Dollar's upward trend is perceived to have changed, the alarm bell will sound and many of the leveraged positions purchased by foreigners will need to be exited in a hurry to protect profits or limit losses. Remember- we are not talking about long term investments {! my emphasis}, we are talking about short term speculations that do not make any sense unless the Dollar's short term trend remains up." END

Comments: He is quite clear that a rising gold price brings in investment demand which is so contrary to our ongoing accumulations. I'm still of the opinion that gold will 'pop' {upwards, of course} THIS YEAR! To many factors are lining up against the market suppressors for this to go on much longer.

Cavan ManForum#5943808/12/01; 16:43:38

Here, here; I wander away to cook dinner for my family and see what I miss? CB (too): I'm enjoying some Chilean Cab Sav--wish you were in da' hood. BR549: My wife is the biggest Stooges fan I know. Beware of absolutism eh? We are almost home. "Believe it".
BR549Wife is a big 3 stooges fan#5943908/12/01; 16:53:24

Cavan Man (msg#: 59438)

You had better keep a close eye on that woman. You are indeed a lucky man. I hate generalizations too. A big Yuk! Yuk! Yuk! and whoop! whoop! to her.

NetkingWhy wait?#5944008/12/01; 16:54:57

Could there be a safer purchase (as either an investor or speculator) ANYWHERE at this given point in time than buying physical gold & silver?

Au & Ag have such limited(very) downside potential & such unlimited upside potential. Be one of the smart ones and buy at the bottom, call USAGOLD/CPM today!

- Netking

RahaFunny#5944108/12/01; 17:24:43

Just dropped in to see what condition my
condition was in and what do I see? Larry, Moe
and Curley Joe. Sheesh you guys are funny!
Good to see the mood has lightened over here.

We PM'ers need to have a sense of humor considering
what we have been through over the last four or five
years or decade or score.

Hope every one has a great day.

ps: to an old friend if he is reading, Gus good luck!


Netking"Be prepared for the worst scenario" - Amr Moussa #5944208/12/01; 17:40:39

Arab information ministers will meet in Cairo Wednesday . . . . following Israel's seizure of the Palestinian headquarters in eastern Jerusalem, the Arab League said.

Arab League Secretary-General Amr Moussa said today the ministers will review the "deteriorating situation in the region," and warned the Arabs will never accept the takeover of Orient House.

"Under these circumstances, we should be prepared for the worst scenario," he said, without elaborating . . .

auspecJames Turk Bombshell#5944308/12/01; 17:51:30

Snippet from James Turk's latest in his Sherlock Holmes series at LeMetropole Cafe:

Here's a mystery for you. It ranks high with any of the great thrillers solved by Sherlock Holmes, but this one is not fiction.

I have been arguing that the US Treasury and possibly the IMF have been selling gold, and that their actions have depressed the gold price. But if I am right, then why has the reported weight of the US Gold Reserve and the gold stock of the IMF remained unchanged?

The easiest answer to this question is also the most unlikely. This low probability answer is that the US Gold Reserve and the gold stock of the IMF are not being accurately reported.

I dismiss this answer, almost completely but maybe not entirely because one never knows what could be happening. A deliberately reported inaccurate weight of gold would mean fraud, and I don't see that deception to be a highly probable outcome. No, I think there has to be another answer. END

Comment: Dammit, am gonna find out what the meaning of the word 'is' is yet! Isn't I?

CoBra(too) GATA & the Cafe are brewin' some strong Coffee too - Today#5944408/12/01; 17:52:18

- Phew, what a day ...

Look at the lastest dispatch at "Little Bears" table - sorry, Bill to hear he's passed away, feel with you - though his last bark was taken up by James Turk re SDR Mirage: ... "SDR's can't be swapped for gold, but there's no regulation at the IMF for prohibiting swapping SDR Certififcates for gold!" ... (ob-)scenarious - not found in Webster's - annie - Now I'm going for good (night) ... cb2

White HillsGold Trail #95#5944508/12/01; 18:10:32

MK, I love the New format on the Trail.Your latest posting brought out answers to many of my own questions. I can hardly wait for the next posting by TG, While we are waiting let me pose some questions to you. The Gold transfers to defend the dollar that are being discussed, could those transfers, or some of them, be to settle accounts with Oil producers in the Oil for Gold deals as discussed by Another and FOA? Is Euro for Oil a done deal? I have to think it was one of the Pillars that the Euro was built on. Went to a local store to look at new metal detectors and in discussion with the salesman he asked what kind of Gold I was going after. I replied $2000.00 per oz gold. This provoked a discussion about the price of gold. His belief was that gold was just a commodity that was to expensive to mine and had no use and was a poor investment as it paid no interest. I only mention this to illustrate the complete lack of understanding out there about gold. And, this is from a guy who makes his living selling prospecting equipment. In the meantime this weekend I will be in th Gold Basin area of Mohave County , Arizona, which is 10 miles from my ranch in Arizona as the crow flies and 50 miles by road. Anybody out there know of any good areas where you can still placer mine? I didn't even mention $30,000 Gold the guy would have had a stroke. White Hills
auspecAnother Turk Snippet#5944608/12/01; 18:26:13

"Does this mean that 87% of the UD GoldReserve has already been swapped? I don't have the answer to that question, but I would like to make four important observations that do in fact suggest that substantially all of the US Gold Reserve has been put into play." END

Comment: Howe would you like to have these guys on YOUR trail after you have defrauded the American people?

auspecWhite Hills#5944708/12/01; 18:30:41

Please tell all my old friends in Mohave County, Kingman and Lake Havasu City hello for me. I grew up there {didn't grow up much however} and know that area pretty well, where is your ranch?
Gandalf the WhiteJUMP SPOT, Jump !!#5944808/12/01; 18:34:40

$275.0 and awakening !!

Cavan Manauspec#5944908/12/01; 18:36:48

Can't wait for N.O. Mysterious guest is AG? That's my guess anyway.
Cavan ManMarkets#5945008/12/01; 18:38:04

Not sure about the moon cycles and sun cycles and bicycles but the Asian markets are off to a poor start and spot is up. Cheers.......CM
Cavan ManIRQ#5945108/12/01; 18:46:47

Can anyone expalin why we are still attacking Iraq almost daily? Is there a good reason why we desire to bring the Chinese into the WTO etc but, continue to make Iraq the the recipient of reprisals consonant with 100 years of failed western policy in that part of the world? Does anyone visiting here realize that Iraq has its own USAGOLD type of forums in addition to struggling families and innocents trying to earn their daily bread? Do you have any additional rhetorical questions CM?
LeighCavan Man#5945208/12/01; 18:52:03

Do you have a link to an Iraqi USAGOLD-type forum? It would be fun to lurk there.

Welcome, Annie! The rumors of your engagement to auspec are greatly exaggerated!!

auspecLeigh#5945308/12/01; 18:55:16

It seems most everything is exaggerated lately, no? They don't allow bigamy in Ala do they?


auspecGood News/ Bad News#5945408/12/01; 19:00:56

The bad news is.....The U.S. gold is gone!

The good news is....The U.S. gold is gone!

Turk says they're now working on the IMF's gold {that's International MFs for those of you not familiar with this elitist tool}.

lamprey_65WAR?#5945508/12/01; 19:09:42

I believe so. I'd be very surprise if we escaped this administration without one (not a Bush basher).

Remember, "It's about jobs." - James Baker during the Gulf War build-up.

Check the continued extremely high institutional ownership of defense contractors (i.e. LMT) for another clue.

Got to run to my night shift know, another tech worker in distress. :-(


BR549Russia#5945608/12/01; 19:10:36

Greetings to my old friend Raha—

Here is a towel to dry yourself after a nice swim. If there are others behind you, I hear there is a bridge under construction but right now it will be one way and you will probably have to be "licensed" to use it, so you may want to swim.

Raha broke the Russian valued-currency story the day that it happened. The implications of the Russian's new economic strategies for those who hold physical gold are immense.

If you believe that constant demand with reduced supply causes prices to rise-then buy some more physical gold.

Like wise if you believe that the Russian's are going to attack the strength of the dollar by flooding the market with their hoarded FRN's and attempt to change it as the world's standard currency-- then buy some more physical gold.

If you believe that the rest of the world is ganging up on the U$ dollar to undermine it via adding physical gold to their own treasuries-then buy physical gold.

If you believe that the U$ will be the last country to go back on the gold standard because they are trapped by derivatives and other paper junk-then buy physical gold.

Welcome, Raha!

It is time to eat some fresh Gulf shrimp and scallops. It has been a Great Day!!

auspecRaha#5945708/12/01; 20:00:37

Good to see you here, man. Ain seen ya sins da udduh day.

Geaux Geauxld!

NetkingIraq #5945808/12/01; 20:01:31

Do "we" (ie Western allies) bash Iraq? Good question & a matter of perception I guess, but I believe not.

The Iraqi people are great, humble & peace-loving struggling to exist with their families, just like those from the PRC. What needs "bashing" though is a regime (any regime) that rises to usurp over the rights of another peace loving neighbour/region for their own personal gain. Has not Iraq got a number of insatiable appetites ie to redraw the map of the Middle East, be it their neighbour Iran, to get Kuwait's gold or push Israel into the sea?

When they start doing all of these & more . . . then enough is enough. (IMVHO)
McAgspec & Annie - The silver bugs here believe you, although dozens of other paper based investors may not.

Black BladeNikkei Crash Continues#5945908/12/01; 20:22:13

Nikkei just might tumble below 10,000 this week if this keeps up. Hang Seng doesn't look too healthy either.
White Hillsauspec Msg#59447#5946008/12/01; 20:23:22

auspec, thanks for the reply. Mohave County, a great place to live. My ranchETTE is off of highway 93 at mile marker 27 (or Rosie's if you are familiar with the area) up whitehills road thru the pass 8 miles to Unit #2 'Goldenhorseshoe ranches. This is a great desert area that has been lived in and mined since the late 1800's. The town of WhiteHills no longer exists but at one time the silver mines there produced more silver than any mines in the southwest. You can still live here much the way they did a hundred years ago as long as you give the other guy plenty of room. Between a business in Las Vegas and making Adobe Bricks at the ranch (11,000 for the house I plan to build) only 10,980 to go. I still look for gold not only in Gold Basin and the general area but from USA Gold, thanks MK. If you are ever in the area please come by and we can talk Gold buying or mining. USA Gold has my permission to give you my email address would love to hear from you. Buy the way the Arizona powerball lottery is 100,000,000.00 this Wed night and people will start coming to Rosie's from Las Vegas to buy tickets. You have to see Rosie's it is like out of old route 66, 4 Tables and a counter. The last time it was this high there was a line down the Highway and they had to carry water out to the people. The wait was close to two - four hours depending on who is doing the telling of the story. I have 20 tickets and am willing to share my $100,000,000.00. So the first USA Gold Posters that Post saying they want to share my POTENTIAL winnings I will Give you a number so that Wed night we can all Watch or listen for the Winning numbers. auspec here is your , I hope winning number. Maybe as being raised in Mohave County you will be lucky. Ticket # A, Numbers 08,17,18,34,47, and 17 is the powerball GOOD LUCK!!! White Hills
Ten BearsOro#5946108/12/01; 20:26:40

Oro,do you still post here?
ShermagA welcome#5946208/12/01; 20:53:49

annie, welcome to the forum.
justamereBearCavan man 59451#5946308/12/01; 20:55:41

No, it just goes on mindlessly. Look at Cuba. The then US Ambassidor to Cuba published a rather lengthy thing on his retirement saying that Cuba was in the US camp before the US started its silly campaign. He was not kind to the US, and said Cuba had nowhere else to turn, but towards the USSR.

Now Cuba is still being bashed, and it is lying prostate, has been for years. Why?


Chris PowellThe Mystery of the Missing SDR Certificates#5946408/12/01; 21:29:01

James Turk's latest essay, "The Mystery of
the Missing SDR Certificates," explains how
the U.S. government may be suppressing
the gold price. Americans should print a copy,
mail it to their members of Congress, and
ask them to determine whether Turk is right
or wrong.

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

This email address is being protected from spambots. You need JavaScript enabled to view it.

Black BladeFlat to Down Week Seen on Wall Street#5946508/12/01; 22:26:29


NEW YORK (Reuters) - Stocks are likely to tread water or decline this week as investors brace for a few earnings reports from key companies and take cues from a heavy economic calendar that includes weak July retail sales. Traders also are seen stepping lightly this week in the run-up to the Federal Reserve's policy-making meeting on Aug. 21. The U.S. central bank is expected to cut interest rates by a quarter-percentage point that day.

Black Blade: Yep, I'm holding Abby Jo's feet to the fire. She had predicted DOW at 12,500, NASDAQ at 6500, and S&P at 1650 (now 1550) by year-end. I think that's a tall order. Many Pied Pipers are changing their tune and now predict recovery in the second half of next year. Earnings are falling faster than lead balloons and valuations are absurdly high. Could get ugly on Wall Street as this recession deepens. With the massive layoffs and loss of the wealth effect from the tumbling stock market, consumers are likely to cut spending and therefore amplify the effects of the recession. Even the bogus CPI and PPI data will not be enough to hide the true state of the economy. Even the FED's rate cuts don't budge the markets anymore. Instead with each rate cut many question what dangers and pitfalls exist in the economy that are so severe to warrant such an aggressive string of rate cuts. Obviously the FED knows that this recession will go down as one of the most severe in recent history. Time to grab a fist full of gold.

RahaHowe complaint#5946608/12/01; 22:50:08

According to latest from GATA, Judge Lindsay
of the Massachusetts Federal District Court in
Boston will have a hearing on the Howe complaint
on Oct. 9 2001.
Geaux GATA, Geaux Reg Howe

Netking25,000+ Investment bankers gone this year, so far . . . #5946708/13/01; 01:37:05

More than 25,000 investment bankers have lost their jobs this year, as the global economic slowdown has hit revenues, a survey said. A slump in company takeovers and mergers has left investment banks without work to support corporate financiers, who advise on these deals.

The number of mergers and acquisitions in July was, in Europe, 34% below the monthly average for last year, and, in the US, 54% lower.

And the slump was reflected in share markets and bond launches, leaving banks with excess traders and brokers . . .

NetkingAsian Stocks Unsettled; Tokyo Hits 16-Year Low#5946808/13/01; 02:02:34

Tokyo . . . The latest knock for the world's second biggest stock market came after painful profit warnings from core domestic players Advantest Corp and Rohm Co

The companies issued the warnings after the Japanese market closed on Friday, but their share prices took the hit on Monday.

Advantest, the country's top maker of semiconductor testing devices, slumped 7.45 percent to 7,830 yen per share, while specialty chip maker Rohm dropped 11.43 percent to 15,500.
TAIWAN . . . vows to prevent panic run on banks:,1870,63715,00.html?

Snippit: Authorities in Taiwan have vowed to prevent a panic run on banks amid moves to overhaul 36 troubled financial institutions in the island's biggest banking reform yet.

To pacify depositors across the island, Mr Yen said his ministry had placed NT$60 billion (S$3 billion) on standby to cover withdrawals, while Mr Perng guaranteed to 'provide liquidity without any limit'.

The appeal came two days after 200 banking officials were given the task of investigating 36 small credit unions or cooperatives, mostly operating in southern Taiwan.

justamereBearNetking#5946908/13/01; 02:19:06

Thanks for the last 2 posts. Had no idea Taiwan was in that bad a shape. I do know that the government has a huge stash of gold, off the books, buried in some government subsidiary (Unless they have disappated it in the last couple of years)(which I think unlikely) Their Fiat in touble, eh? makes the cheese more binding


NetkingAg #5947008/13/01; 03:03:16

Wonder what's goin down with Ag, up about 10 cents in as many minutes on Bart's graph . . . back to where it was last week before it took "a hit" last week. Reminds me of a series of small shock waves before the earth quake.
J'Bear - I have a feeling "we aint seen nothing yet" with this . . . - Netking

Simply Meauspec: RE BR549 and Local Gold Interest#5947108/13/01; 04:07:47

Do you happen to remember a weekly television series from the late '60s to early 70's called HeeHaw? Sort of a TV version of the Grand Ol' Opry. It was country music and skits starring Roy Clark, Buck Owens and "the whole HeeHaw gang". One of the gang was a big ol' boy named Junior Samples who was always selling something and at the end of his "commercial" satire he would hold up a sign and tell everyone to call "BR-549".

Maybe you're not old enough to remember that show. But I'll bet our "BR549" is old enough to remember when your TV got 4 or 5 channels if you were lucky.

Welcome BR549! I'm an infrequent poster, but a faithful follower of this forum since 1999.

By the way, folks, I'm seeing a renewed interest in gold on the small-time coin dealer level. Not that the average State Quarter collector is getting the itch...but folks with a little money to put away have started to make regular gold purchases rather than stuffing their Money Market Funds and IRA's. The tide began to turn this summer.
Not that such small time gold demand is going to raise the POG...but I think it's an indicator that some folks still remember the value of gold. And the average age seems to be in the 40s and up. The same folks who would remember what BR549 means!

Thanks, as always, to all who post their knowledge here!... Especially to MK and TrailGuide. I'm still here on the trail...huffing and puffing to keep up but immensely grateful to be here.

As someone who's been following for awhile, I can testify to the newcomers that, even though the trail moves slower than you might like and the twists and turns leave you feeling lost, when you get to each overlook landing you can look back and see that the whole way was clearly marked by our good TrailGuide.


nickel62The answer to how the government gold manipulation has been accounted for by the government accontantstes#5947208/13/01; 04:35:32

The Mystery of the Disappearing SDR Certificates

by James Turk

Copyright 2001 © by The Freemarket Gold & Money Report.

Here's a mystery for you. It ranks high with any of the great thrillers solved by Sherlock Holmes, but this one is not fiction.

I have been arguing that the US Treasury and possibly the IMF have been selling gold, and that their actions have depressed the gold price. But if I am right, then why has the reported weight of the US Gold Reserve and the gold stock of the IMF remained unchanged?

The easiest answer to this question is also the most unlikely. This low probability answer is that the US Gold Reserve and the gold stock of the IMF are not being accurately reported.

I dismiss this answer, almost completely but maybe not entirely because one never knows what could be happening. A deliberately reported inaccurate weight of gold would mean fraud, and I don't see that deception to be a highly probable outcome. No, I think there has to be another answer.

I touched upon the possible solution to this mystery earlier this year. I wrote (Letter No. 283, "Behind Closed Doors") that the portion of the US Gold Reserve stored at the depository in West Point, New York had been swapped with gold owned by the Bundesbank, and that the gold in the German central bank had been sold. So far, nothing I have seen refutes this contention, and correspondence from the Bundesbank has wrapped much of its gold policy in a cloak of confidentiality, adding credence to my conclusion. After all, if my supposition weren't true, why not just disclose the facts to convincingly refute it?

Be that as it may, there were some loose ends that in my mind needed to be tidied up in order to add more substance to my contention that much of the US Gold Reserve was swapped and then sold. And first among those loose ends was the accounting. How were all of these gold transactions being accounted for? How could all of this gold be put into play even while the reported weight of the US Gold Reserve and the gold stock of the IMF remained unchanged? And perhaps most importantly, why didn't these transactions result in any apparent change on the balance sheet of the main perpetrators of this scheme, the Federal Reserve and the Exchange Stabilization Fund? There has to be some kind of accounting trail, doesn't there?

I've thought long and hard about these questions, but have been unable to answer them to my satisfaction – until now. And in this regard, I would like to thank David Walker, a tireless researcher who has an uncanny ability to read between the lines of tedious and dull government reports to get at the truth. Dave's terrific work provided me with the motivation to continue researching an area that until recently had been largely unfruitful for me. And what is that area? A monetary instrument emitted by the International Monetary Fund called the SDR, an acronym for Special Drawing Rights a.k.a. ‘paper gold’.

My intuitive sense for some time had been that SDR's were the key necessary to unlock the door. By understanding the SDR, I expected that one could understand what was happening to the US Gold Reserve as well as put together a consistent accounting and the legal framework for the gold transactions that I contend have been taking place. But even though I thought SDR's would provide the much sought after answer I was seeking, I was having trouble with a few things, mainly related to the accounting.

For example, SDRs are so-called "paper gold", so this financial asset has to have a corresponding liability just like any other ‘paper’ money, right? But I couldn't find who or what is actually liable for the SDRs.

After digging away in the IMF archives, I found the following in an IMF accounting manual called the Manual on Monetary and Financial Statistics, in a section entitled "Definition of Financial Assets:

"Monetary gold and SDRs issued by the IMF are financial assets for which there are no corresponding financial liabilities."

How about that? No wonder I couldn't reconcile the accounting. Here's a purely financial asset with no corresponding liability!?! SDR's issued by the IMF are accounted in the same way that the IMF accounts for its stock of gold. I thought that only tangible assets like gold, houses and land had no liabilities. I never dreamed that a financial asset would not have a corresponding liability, but after this realization, one thing led to another and everything slowly but surely started falling into place.

In "Behind Closed Doors" I included the following quote from the transcript of the January 31st, 1995 FOMC meeting:

MR. TRUMAN. The legislation governing the objectives of the ESF was changed, I think for the most part in the mid- to late-1970s. The changes included the language that the government of the United States and the International Monetary Fund have the obligation to promote orderly exchange rate arrangements leading to a stable system of exchange rates.

Since first reading this candid comment I have always been struck by it. Truman is relying upon this 1970's legislation to provide the legal justification to use the ESF to bail-out Mexico. It therefore seemed clear to me that if I could figure out what was implemented in the 1970's, I could then come to more precisely understand how the US Gold Reserve was being put into play.

I had been unsuccessful, however, in trying to figure out what was the legislation to which Truman was referring. Well, I now think that he was referring at least in part to what is called the Second Amendment of the IMF.

By way of background, when the gold crisis in the 1960's was in full swing, the original IMF articles were amended. This First Amendment to the IMF created SDRs. Then here's what the Second Amendment did.

What changed under the Second Amendment to the Articles of Agreement of the IMF? The Second Amendment to the Articles of Agreement of the IMF, which came into effect in April 1978, eliminated the use of gold as the common denominator of the par value system and as the basis of the value of the SDR. The Amendment also abolished the official price of gold and abrogated the obligatory uses of gold in transactions between the IMF and its members… Under the Amendment, members undertook to collaborate with the IMF and other members with respect to reserve assets to promote better international surveillance of international liquidity.

I draw your attention to the last sentence. I think this statement explains what Ted Truman was referring to. The term "international liquidity" is a euphemism I think that gives a carte blanche to do whatever the various IMF members want to do, using assets that are at hand or whatever assets that they create out of thin air, to intervene and manipulate any market anyway they want under the guise of "international liquidity" – which really means to let the banks create credit out of thin air for no other purpose but to keep the present system afloat so they can preserve their position of privilege and keep lining their pockets.

The following quote is from the "User's Guide to the SDR" published by the IMF.

3. Improvements in the SDR after the Second Amendment:

One of the major objectives of the Second Amendment of the Fund's Articles of Agreement, which became effective on April 1, 1978, is to make the SDR the principal reserve asset of the international monetary system. To this end, the Fund's Executive Board has taken a number of decisions to improve the yield on the SDR and its liquidity and usability. At the same time, certain obligations arising from participation have been eliminated.

"Improvements" to you and me may sound innocuous, but in reality these 'improvements' have only one objective – to keep the present system afloat by providing more power to governments working hand-in-hand with the banking cartel. So far I'm not sure of all the ways the SDR became more usable, nor have I yet discovered all the obligations that were eliminated when the Second Amendment "improved" the SDR. But I have learned enough about the SDR to conclude why the accounting of the US Gold Reserve does not appear to have changed. This mystery can be solved by first solving a second mystery, the case of the disappearing SDR Certificates.

To begin, it is necessary to provide some background information gleaned from more hours of studying arcane IMF accounting than I care to admit, but I'll keep it simple. And the way to do that is to show how ‘real gold’ and Gold Certificates are accounted, because I have learned that ‘paper gold’ and SDR Certificates are accounted essentially the same way.

The US Gold Reserve does double-duty. It sits in the vaults at Fort Knox and the other depositories, but the US Treasury has issued Gold Certificates against it. The Federal Reserve owns these Gold Certificates, giving the Fed a claim to the 261.6 million ounces in the US Gold Reserve. Simple enough, and the same transaction is used for ‘paper gold’ – the SDR's – with just one small difference. The US Treasury has transferred its SDR's to the ESF, so the ESF and not the US Treasury issued the SDR Certificates now owned by the Federal Reserve.

Importantly, these SDR Certificates are being accounted for much the same way as the Gold Certificates. Both are carried at book value, which is much less than their market value. The Gold Certificates are carried on the Federal Reserve's books at $11,046 million, which doesn't sound like much. However, when you consider that these Gold Certificates are being valued at only $42.22 per ounce, this asset represents the entire 261.6 million ounces in the US Gold Reserve. And the SDR Certificates are being valued at – well, here is where it starts to get interesting. And here is where the mystery of the disappearing SDR Certificates comes into play. Look at the decline in the SDR Certificates in the accompanying table.

Exchange Stabization Fund
Federal Reserve


(in millions)
(in millions)













The above table presents the SDR assets and liabilities of the ESF and the Fed. Though recent figures for the ESF are not available, as of August 9th the Fed still owns only 2,200 million of SDR Certificates, so presumably the SDR entries on the ESF balance sheet have not changed much since December 2000. To understand why the SDR Certificates are disappearing as well as where they are going, more background information is necessary.

The US, like each IMF Member, owns SDR's but is also responsible for the value of the SDR. Note #4 of the ESF's financial statement for 1999 explains it thus: "Its [the SDR's] value as a reserve asset derives, essentially, from the commitments of participants to hold and accept SDR's and to honor various obligations connected with its proper functioning as a reserve asset."

As of December 1998, the ESF owned 10,603 million SDR's, but it had a liability for 6,899 million SDR's. What does this liability represent? Here's what Schedule B of the Articles of Agreement of the IMF says: "…0.888671 gram of fine gold shall be equivalent to one special drawing right." That means 35 SDR's equals one ounce of gold. So the US has the potential obligation as of December 2000 – if required to make good on SDR's issued – to pay to the IMF or its members 182.4 million ounces of gold, some 69.7% of the US Gold Reserve.

That huge liability is pretty scary, but it is only a potential liability. Who knows whether the US will ever be required to make good on it, or if it does, whether the US will default just like it defaulted in 1933 on its obligation to pay US government bonds in gold and in 1971 on its obligation to redeem 35 dollars for one ounce of gold. Those are problems to worry about in the future. Of more immediate concern is the decline in the SDR Certificates. What is that all about? To answer this question and to solve this mystery of the disappearing SDR Certificates, we have to once again go back to basics.

Why are the SDR Certificates declining? The basic answer is quite simple. The SDR Certificates MUST BE reduced if the ESF intends to use its SDR's for any purpose, such as market intervention or swaps. In other words, the SDR Certificates are a claim against the SDR's, so the SDR Certificate must be cancelled to remove any claims on the SDR before the SDR can be used by the ESF. But the amount of SDR's owned by the ESF hasn't changed except briefly in early 1999, so it seems that the SDR's are not being used for any purpose.

So what I think has happened is that the SDR Certificates are themselves being used by the ESF. Here's what the IMF says about the use of SDR's in swaps: "In accordance with Article XIX, Section 2(c), the Fund prescribes that...a participant, by agreement with another participant, may engage in an operation by which (a) one of the parties transfers [i.e., swaps] to the other party SDRs in exchange for an equivalent amount of currency or another monetary asset, other than gold."

Thus, SDR's cannot be swapped for gold, but there is no IMF regulation that prohibits the swapping of SDR Certificates for gold. So let's take this observation to its logical conclusion, namely, that the ESF and/or the Federal Reserve has been swapping SDR Certificates issued by the ESF for gold owned by the Bundesbank, and presumably other central banks as well because we noted above that the Second Amendment states that "members undertook to collaborate with the IMF and other members" for the sake of international liquidity. So presumably, all IMF members are committed to undertake any scheme that the US government may hatch.

This interpretation may also explain the strange response to Alan Greenspan by the Fed's General Counsel, Virgil Mattingly, who has "no clear recollection of exactly" what he said during the January 31st, 1995 FOMC meeting, even though it seems most likely that the transcript accurately records him as saying "gold swaps". In his June 8, 2001 note to Greenspan, Mattingly states: "I can confirm that I have no knowledge of any ‘gold swaps’ by either the Federal Reserve or the ESF." Is Mattingly being truthful? Yes, I think so, at least in regard to the precise choice of terms used in his note.

Remember President Clinton's exegesis on the definition of the word is? Lawyer Mattingly I think is playing the same game. By this line of thinking, neither the Federal Reserve nor the ESF do ‘gold swaps’. Instead, these transactions are probably called "SDR Certificate Swaps" or some other similar term, although the FOMC participants may use the unofficial term "gold swaps" as a short-hand moniker that is not only easier to say than the official name of the transaction, but also has the added advantage of clearly communicating the net result of the transaction.

There is another important piece of corroborating evidence that SDR Certificates are being used by the ESF to hide its gold transactions. When several months ago I first read the audited financial statement of the ESF, I was struck by a peculiar phrase in footnote #4, which in addition to considerable explanatory text also provided a table of SDR purchases and sales during the year. The text stated that these purchases and sales were "equivalent of SDR's". Therefore, I concluded that if they were "equivalent of SDR's", SDR's were not actually being used in the transaction. But I wondered, if they weren't SDR's, then what were they? We don't know for sure what they are, but they are probably SDR Certificate transactions – not SDR's, but only their "equivalent".

Let's put the size of these transactions into perspective. As of December 2000, the ESF owned 10,539 million SDR's, against which it has issued 2,200 million SDR Certificates. Therefore, 8,338 million SDR's are potentially ‘in play’, but we can refine this number given that it is the SDR Certificates and not the SDR's that are important.

The ESF by law cannot issue more SDR Certificates than it has SDR's. The largest amount of SDR Certificates outstanding was 10,168 million in December 1995, a significant date because I have contended all along that government actions that have depressed the gold price began in 1996, which is the same year that the SDR Certificates began to decline. From this peak to the present, the SDR Certificates have been reduced by 7,968 million. Given that there are 35 SDR per ounce of gold, this reduction in the SDR Certificate account equates to 227.7 million ounces, or 87% of the US Gold Reserve. Does this mean that 87% of the US Gold Reserve has already been swapped? I don't have the answer to that question, but I would like to make four important observations that do in fact suggest that substantially all of the US Gold Reserve has been put into play.

First, note on the accompanying table the dates when the SDR Certificates began to decline rapidly. From 10,168 million in December 1995, the SDR Certificate account declined to 8,200 million by June 1999, or 19% over 3½ years. Now look at the decline beginning in the third quarter of 1999, which corresponds with the Washington Agreement signed in September of that year. In only 18 months the SDR Certificate account declined by 73%. Was there a panic to get gold into the market after the Washington Agreement to keep the gold price from rising? This evidence sure does support that conclusion.

Second, readers will recall how the US Treasury changed in September 2000 the classification of that portion of the US Gold Reserve in West Point to "Custodial Gold". It is interesting and probably meaningful to note that this change occurred in the fiscal year ending September 30th in which there was a substantial decline in the SDR Certificates.

In "Behind Closed Doors" I speculated that the reason for this reclassification was that the Mint's accountants or its new director realized that it was misleading to continue calling this swapped metal as "Gold Bullion Reserve". This logic may also explain why more recently, the entire US Gold Reserve was reclassified as "Deep Storage Gold". If 87% of the US Gold Reserve has indeed been swapped, it may have been too obvious an admission by the US Treasury to reclassify nearly the entire US Gold Reserve as "Custodial Gold". Therefore, to give some semblance of proper accounting while not totally divulging the truth, the Treasury came up with the half-baked term "Deep Storage Gold". Further, it was my thinking that the Treasury, taking a lesson from lawyers Clinton and Mattingly, probably defined this term in some obscure Treasury accounting manual.

What was a speculation on my part is now supported by a letter dated August 7, 2001, to Richard May from John P. Mitchell, Deputy Director of the US Mint. Mitchell states: "The gold in West Point was not reclassified – it was renamed to better conform to our audited financial statements." Despite providing five pages of supporting material with his letter, Mitchell does not explain how this ‘renaming’ enables the Treasury to "better conform to [its] audited financial statements." The logical conclusion is that this better conformation arises because the strict application of prudent accounting principles no longer allows the Treasury to use the term "US Gold Reserves" because more than half – and possibly 87% of it – has been swapped. Given that the Treasury does not want to use the more accurate but alarming term "Custodial Gold", the US Gold Reserve has therefore instead become "Deep Storage Gold", allowing the Treasury to remain within the letter if not the spirit of the principle of full disclosure.

The third observation takes the above changes and explains them in weights of gold. The 6,000 million drop in SDR Certificates from June 1999 to December 2000 represents 171.4 million ounces, or 28.6 million ounces (888.7 tonnes) per quarter. That's a supply of about 3500 tonnes per year, which added to 2500 tonnes new mine production implies an annual demand of 6000 tonnes for the period of time after the Washington Agreement. Is this number reasonable?

In my opinion it is reasonable. Noted gold analyst Frank Veneroso contends that annual gold demand has been running about 5000 tonnes, but this number reflects normal market conditions. After the Washington Agreement and the price spike, the market was anything but normal. Even though fabrication demand fell during that period, investment and monetary demand for gold soared. So it is not unreasonable to expect that more than 1000 tonnes of newly supplied gold from government dishoarding was needed in the months after the Washington Agreement to turn the price back from the +$320 level reached at that time.

The fourth and final observation relates to a point I made in the last newsletter. I noted how earmarked gold has been shipped from the Federal Reserve Bank of New York at a rate of at least 40 tonnes per month beginning in September 2000, while also stating this new "dishoarding from the NY Fed smacks of desperation". The above table confirms this conclusion.

The SDR Certificate account has not changed since the 4th quarter of 2000. With only 2,200 million remaining, the SDR Certificate account, while not depleted, is near rock bottom and one must ask how much more gold the US government is willing to throw at the market? I don't think the answer to that question is "all of it", so essentially there is no more US gold available for swapping. Consequently, with these SDR Certificate swaps eliminated as a source of supply, another source of gold had to be located to fill the gap between supply and demand.

In the last newsletter I suggested that the IMF is this new source. That's just a supposition on my part, but it seems logical that IMF gold is being shipped out of the FRB of NY. The quantities being shipped are so large, the gold must be coming from a large hoard, and the IMF has, on paper at least, one of the world's largest. But regardless of whose it is, this gold is being shipped at a rate greater than gold is being mined each month in South Africa, the world's largest producer. That volume of shipments smacks of desperation to get gold into the market, and the reason is clear. Because the SDR Certificate swaps have ended, a new source of gold supply is needed to keep the gold price from exploding upward.

In conclusion, it is becoming very obvious that the US government has put itself in an incredible pickle. But we've seen this happen before.

In the 1960's the US government dishoarded over 9000 tonnes of gold rather than admit that the dollar had been debased and was no longer worth only $35 per ounce. Now it appears that perhaps as much as 7,000 tonnes (227.7 million ounces) has been swapped for essentially the same purpose – to intervene in the market to fight the truth, rather than admit that the dollar has again become very debased relative to gold. ¤

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ZenideaNickel62... Feels the vibes.#5947308/13/01; 05:20:09

Good on ya pal !, its about time someone spat it out !. and I am not talking accounting/swaps inter-alia .... I mean
isotopes !. Not only have you given a number of reasons for + or - you have given an intuitively fundamentaly low radioactively laboratory nano nuclear motif split that pays for our oil ,whoops energy on a constant basis
Time limited threshold. as the ancients never gave up on .
Black Blade next week will be watching the history channel.

nickel62Zenidea #5947408/13/01; 05:24:47

Would you run that one buy me again...I think I missed your meaning.
SteveHSo, it turns out that the strong dollar policy is #5947508/13/01; 05:27:08

really the SDR Certifate swap. In other words, US gold ownership has been swapped to protect the short-term value of the dollar.

If it weren't for the internet (no thanks to any news media whatsoever -- after all they are all owned by big corporations who are beholding to the banks behind this) we wouldn't have had a clue.

Murphy is right, this is the biggest financial scandal of the 20th and 21st century and it seems cnn is the last to know (or to report it anyway).

What the heck ever happened to good investigative reporters whose traditional role it was to find these things out and expose them? Or is this being too naive?

CanuckThe Petition#5947608/13/01; 05:36:36[partner_userID]=977161898&sign[memberID]=977161898&sign[partnerID]=1

After the article by James Turk I have added my name to the 'Petition'.

Registration is required, 'anonymous' may appear to the public.

A field also allows a comment. The petitioning is to "Clarify U.S. Policy on Gold and Gold Accounting.

I have added, "There has not been an official audit of U.S. gold in over 25 years; I would bet only a handful of people really know how much gold there is."

nickel62SteveH You answered your own question!#5947708/13/01; 05:43:41

The only investigative reporters left are right here on the internet..PERIOD!
nickel62Could anyone tell me where in Boston the Howe court hearing would be?#5947808/13/01; 06:01:28

I would like to attend and maybe even take my kids to see this hearing before the US judge. I think that it will be one way or the other one of the most significant events in our Constitutional form of government. I missed the Watergate trials but this should be even more eventfull. It is also an important way for the world to learn of the importance of this action. One way or the other freedom hangs in the balance. If the demonstaters in Geneva hadn't shown up who would even consider that there was any opposition to the new form of global colonization we have evolved. So email me any information that any of you have on the location and time of the hearing and lets see if any of us can find the time to attend..
ZenideaNick ! Follow your instincts.#5947908/13/01; 06:15:33

You have never missed a trick, I mean gold that pays for oil
Anothers H.O.F. Those countries whom understand the nuclear equations and of whom belong to a special group
of laboratories i.e usa . russia, france , nuclear in a bottle. You asked .. Valences and vacuum's in clylones :)

Zenideaops#5948008/13/01; 06:25:20

Cyclones ='s velocity, read socrate's, how many times must I hint it?.
Gold Trail UpdateThe Gold Trail Discussion has been Updated#5948108/13/01; 07:24:31">The Gold Trail Discussion has been updated. Click on the link to read the latest updates.
Mr GreshamIMF link on gold#5948208/13/01; 07:33:35

Here's the surprisingly informative section at the IMF site given in Turk's essay, which I couldn't resist jumping to before finishing off Turk's mystery thriller...
CoBra(too)The Unfolding of a Drama of historical Proportions?#5948308/13/01; 07:50:02

As an historical pattern is evolving before our eyes - thanks to all the great research of all the gold advocates -
a pattern of financial scheming through-out the last century, debasing all and any currency from its hard asset backing up to the US$ reserve hegemony,it now seems the global financial a/o monetary system is at risk to totally destruct.

At every juncture in this scheme gold played the main part as it was huge amounts were lost in all the manipulations to stem the tide of sudden debasement, rather we've seen a sneaking debasement, which could be more conveniently hidden by the spinmeisters of NWO.

The late 60's had their London Gold Pool and took about 9.000 tons of au to keep the $ pegged, leading up to the 71 funeral of Bretton Woods. Again in 1979 the Ldn. G.P. was resurrected to defend the $'s position, while the Plaza Accord was designed to install the IMF's synthetic SDR's towards the lender of last resort.

And now we know, that over the last several years the gold leasing scheme can be seen as a last ditch effort to save the precarious monetary system, while the foundations eroded under its own gravity and a new contender to the fiat throne was in the making.

Looking back to the Washington Agreement and what was discussed since on this (A/FOA/MK) and similar fora, as well as Reg Howe's, Gata's and James Turk and many others, in regard of what is evolving evidently comes together like pieces of a puzzle. And only few will see, what becomes glaringly clear to us over here.

Musings on how history will see the early part of the new millenium? Gold - the ultimate insurance to be had for little paper, for how much longer though? best - cb2

USAGOLDToday's Commentary: Off to Good Start; Run of Reports Should Make for an Interesting Week#5948408/13/01; 08:11:55


In Brief: Gold is higher this morning on good investor
demand overseas adding more spice to the traditionally
slow summer doldrums period. There were unconfirmed
reports on Friday and over the weekend that a large
Australian gold producer was squaring its hedge book and
giving gold impetus. The dollar is off slightly adding to
the firm action in gold. Allen Williamson, an HSBC trader
quoted by the AFP news service, summed up currency
gold sentiment: ""The US dollar has weakened and there
is quite a close correlation: when US dollar weakens, gold
strengthens. We will be looking at the market to trend
higher over the next few months." That assumption, AFP
goes on, is "based on the assumption that the dollar would
weaken further."

A run of government report card on the economy could
make for an interesting week. We have Retail Sales
tomorrow; Industrial Productivity on Wednesday;
Consumer Prices on Thursday and the Trade Balance on

That's it for now. See you back here tomorrow. Have a
good day, fellow goldmeisters.

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Black BladeSilicon Valley in the dumps as high-tech giants' stocks lose $2 trillion US #5948508/13/01; 08:15:29


SAN JOSE, Calif. (AP) - A Silicon Valley company thought so much of Jim Roorbach that it brought him to California from Virginia in January to direct its information services. He and his wife bought a house in San Jose. Then one day in May, Roorbach was suddenly laid off. Until recently, that wouldn't have been terrible for Roorbach, 59. A retired navy captain with two master's degrees and 36 years of technology experience, he could be an employer's dream. Not so in the brutal summer of 2001 in Silicon Valley, where the high-tech downturn and U.S. economic slump have hit hard and fast.

As companies lost value, the local unemployment rate more than doubled - and is now worse than the national average. Layoffs hit safe havens such as Hewlett-Packard Co., not just flamed-out Internet companies. "So, what do you do for a living?" is no longer a pleasant icebreaker at social occasions. Companies that aren't shedding workers have stopped hiring. Those with jobs are taking pay cuts. Lucrative mergers and initial public offerings are drying up. For most people, the tech boom's giddiness seems like a dream.

"The job market is almost nonexistent," said Roorbach, who has had job interviews but no offers. "If this goes on four, six months, you're going to see a mass exodus out of the valley."

Black Blade: More lessons from the "Bone Pile." There's a lot of cash gone to "Money Heaven." Silicon Valley has also been hit very hard by the energy crisis and the resulting high energy costs. Many high tech companies have moved out of state and many more are considering moving as well. California's economy is toast and it will sweep eastward. Some trend setter! A "Gold Pile" would not be a bad addition as portfolio insurance.

BR549HeeHaw#5948608/13/01; 08:25:02

Simply Me (msg#: 59471)

Yep! Loved HeeHaw. I used to watch it with my dad. He loved Junior Samples who was born in Cumming, GA just above Atlanta. My dad was born there but moved away early in his life and always wanted to return. He never did. Dad wasn't at all like Junior Samples but loved his honesty, his humor, and the way he laughed. The land is real expensive in Cumming now that the Carpetbaggers and banksters have driven the family farmers out.

HeeHaw was indeed where my handle came from and not the gibberish rock band that has also appropriated it. I think that buying a gold coin every now and then is what everyone should do, before the Feds dishoard our national supply to the other Bundesbank's around the world.

Thanks for the warm welcome and I suggest that you become a more frequent "rather than infrequent" poster.

Black BladeIs home ownership a bubble, too?#5948708/13/01; 08:27:33


"How can we be out of money? We still have checks." So it is with the Great American Buying Spree. Stocks are weak, but so what? Home prices keep roaring onward and upward. This means homeowners have more collateral to borrow against. So let's party. Today, your home isn't your castle. It's your margin account. At the end of the first quarter, according to the National Association of Realtors, the median existing home resale price rose 4.7 percent over the previous year. That means home prices beat inflation and incomes.

Basically, homeowner collateral and borrowing power are increasing faster than our ability to pay the money back.

Black Blade: I have touched on this before, however, I did not think of real estate per se as a "Bubble." I have always stressed investment in hard assets. Many have been lured by the 125% value loans on their homes - putting their homes at risk. It will get very ugly when this is all said and done. Interesting article.

BTW, The Pied Pipers (such as Ned riley of State Street Global Advisors) are very busy this morning. Notice how they come off as Used Car Salesmen?

Black BladeStock funds drop 3.3%#5948808/13/01; 08:34:20


Stock mutual funds gave up 3.3% of their value on average this week, as both the Dow Jones industrial average and the Nasdaq composite index posted losses, according to Lipper, the fund trackers. Only three fund categories finished the week ended Thursday, Aug. 9 in positive territory: gold funds, real estate funds and Latin America funds. Gold funds were the best performers, posting a 3.1% average gain. For the year, gold funds are up 11.6% on average, second only to small-cap value funds, which are up 12.1%.

Black Blade: The article still pans gold, however, gold stocks tend to lead gold prices. There's a reason the stock bubble has popped and gold is higher. There's a fundamental change in direction that has put the global economy in a deepening recession. People see the value of the retirement vaporizing before their eyes and they are getting scared. Some even run toward gold.

BR549Dishoarding our National Treasury a.k.a. Turk dissected#5948908/13/01; 09:24:35

Turk's genius sort’a simplified--

--US Treasury and possibly the IMF have been selling and delivering physical gold from U$ coffers

--87% of the US (real stuff)Gold Reserve has been swapped for paper and then sold

--reported weight of the US Gold Reserve and the gold stock of the IMF unchanged

--no apparent change on the balance sheets of Fed and the (ESF) Exchange Stabilization Fund

--How? Fraud or invented SDR, an acronym for Special Drawing Rights a.k.a. 'paper gold'.

--Gold (real stuff) and SDRs (a.k.a. paper) issued by the IMF are financial assets for which there are no corresponding financial liabilities."

--Created "international liquidity" – which really means to let the banks create credit (a.k.a. paper) out of thin air for no other purpose but to keep the present system afloat so they can preserve their position of privilege and keep lining their pockets.

--providing more power to governments working hand-in-hand with the banking cartel

--'real gold' and Gold Certificates (a.k.a. paper) are accounted for the same way that 'paper gold' and SDR Certificates (a.k.a. paper) are accounted for

--Fed issues Gold Certificates (a.k.a. paper) against U.S. (real stuff) gold reserves (261.6 million ounces)

--SDR (a.k.a. paper) Certificates are being used by the ESF to hide its (real gold) gold transactions

--US Treasury has transferred its SDR's (a.k.a. paper) to the ESF

--ESF and not the US Treasury issued the SDR (a.k.a. paper) Certificates which are now owned by the Federal Reserve.

--SDR's (a.k.a. paper) & gold certificates (a.k.a. paper) carried by Fed at book value ($42.22/oz) than current market value ($275/oz.+-)

--Fed holdings declined to 2,200 million of SDR Certificates (a.k.a. paper) from 9,200 since 12/98

--0.888671 gram of fine gold shall be equivalent to one special drawing right." That means 35 SDR's equals one ounce of gold. (no U$ FRN monetary value assigned)

--US guarantees IMF liabilities (a.k.a. paper) represents 69.7% of the US Gold Reserve

--SDR Certificates (a.k.a. paper) are a claim against the SDR's so manipulations will be legal

--IMF swaps SDR Certificates (a.k.a. paper) for physical gold

--Fed renames Gold Reserve in West Point to "Custodial Gold (a.k.a. paper) " a.k.a.,"Deep Storage Gold" (a.k.a. paper)

--gold demand has been running about 5000 tonnes

--40 tonnes per month beginning in September 2000 being dishoarded by Fed

--SDR Certificate (a.k.a. paper) swaps eliminated as a source of supply, another source of gold had to be located to fill the gap between supply and demand.

Turk's Summation: "In the 1960's the US government dishoarded over 9000 tonnes of gold rather than admit that the dollar had been debased and was no longer worth only $35 per ounce. Now it appears that perhaps as much as 7,000 tonnes (227.7 million ounces) has been swapped for essentially the same purpose – to intervene in the market to fight the truth, rather than admit that the dollar has again become very debased relative to gold."

Check the link for the original chart's and article and pass the link on via your e-mails.

annieSDRs, etc.#5949008/13/01; 09:29:56

Please consider this as a "work in progress"--a bit loosey goosey for starters. After reading the Turk article, I have not read any comments and must now go to work.

Thanks to Leigh for your greeting. Also to all of you have welcomed me directly and through your kind attention to my presence here.
As I ploughed through the Turk article, my mind was once again desperately trying to find some "real world" coefficient to which I could attach his terms in order to form a basis of understanding. Hmmmmm.

Then I came up with an idea. As a child, my brothers and I would play poker. We were not allowed to "gamble", but we were allowed to use matchsticks as "chips". My oldest brother would quite ceremoniously break the matches in half declaring the end with the phosphorous tip as $5 and the naked end as $1. Then the matchsticks were doled out to each of us equally. It seems to me that what the IMF did is similar. Instead of doling out matchsticks, they doled out SDRs, then ceremoniously declared them to be the equivalent of gold.

My oldest brother, being the oldest, decided one day that at the end of the game, each of us would pay a penny for each "$1" and a nickel for each "$5".

Had my brother had the ESF and IMF model to go by, he could have justified all of this to my mother: We were not gambling; we were just playing for matchsticks. At the end of the game, certificates were awarded to indicate who had been most successful. The sibling who had negative value on their certificate agreed to put pennies into "the pot". Conversely, those with certificates of a positive value were allowed to take pennies out of the pot.

No money was gambled; the matchstick chips could not be exchanged for money.

Let's continue by saying that we decided to keep the game going. Certificates could be accumulated. So we decided that we would use the weekly allowance as a guideline. Two older brothers got $1 a week; baby sister got $1/2 a week. This would create a "pot" of $2.50 for a week. Matchsticks would be handed out, ceremoniously, of course.

And let's project that one week, I get lucky. The big one. A royal flush. Having secretly practiced in front of a mirror, I sandbag shamelessly. Pretending frustration—betting out of control. And I win—big. I get a certificate worth $2. Okay.

The elderly man who ran the country store less than 100 yards down the road sold candy and soft drinks and all sorts of things that little people could treasure. There was a pocket knife that I had gazed at time and again. I offer my certificate. My kindly neighbor accepts it. My parents find out and nobody gets an allowance. Oops.

I need to give this more thought, but need to go to work. I can think while I work. Any suggestions? Comments?

TIA, annie

geJames Turk's Latest Article#5949108/13/01; 09:35:50

It is very interesting. US and Germany swapping gold, and Germans selling the US gold. I wonder whether the Germans sold the physical metal or just (paper) gold notes?
VanRipMr. Turk's Article#5949208/13/01; 10:38:20

Mssrs. Turk and Howe and GATA have done an astonishing amount of work unraveling the intricate web of gold and its use in international affairs.

However, It is one thing to see how all the pieces of the puzzle might come together but quite another to realize that the government may simply say, so what, it's all legal. I imagine that's what their lawyers will try to prove, if it ever gets to trial, and that what looks like a conspiracy is simply the mechanism for keeping a "stable system of exhange rates," blah, blah, blah. It's all in how you interpret what the legislation says (see reference to some it below in snips from Mr. Turk's article ). Mr. Howe will be up against some slippery folks.

"MR. TRUMAN. The legislation governing the objectives of the ESF was changed, I think for the most part in the mid- to late-1970s. The changes included the language that the government of the United States and the International Monetary Fund have the obligation to promote orderly exchange rate arrangements leading to a stable system of exchange rates.

.....Under the Amendment, members undertook to collaborate with the IMF and other members with respect to reserve assets to promote better international surveillance of international liquidity. "

VanRipPart of Reg Howe's Task#5949308/13/01; 10:57:38

From a release to the Business Wire from GATA just a few minutes ago. I hope it gets some visibility.

....The underlying issue at the hearing Oct. 9,
according to Howe, will be whether the U.S.
Constitution and federal law may be enforced
in a federal court action challenging the authority
of former Treasury Secretary Lawrence Summers and other American officials, working in part through the Bank for International Settlements, to conduct surreptitious gold price-fixing operations."

Buena FeThe $ has no Gold#5949408/13/01; 11:25:02

Absolutely outstanding work by Murphy/Howe/Turk/GATA, et al. In my opinion, the single most important thought to ponder in this is, "how long till the international trade (read oil) community believes/admits/owns up to the fact that the US is bankrupt, and does something about it?" Some within this community have understood these issues for a long time, but it has been convenient/safer(?) (source of cheap Au) to "play along" until ............. when?
Buena Felast sentence should read#5949508/13/01; 11:55:55

....but it has been convenient (source of cheap Au), and safer (bombs away Iraq) to play along.........

Yes, I believe that America has/does/will use military options to manage/infuence economic policy, but when the whole world reaches the same conviction "the $ is naked" at roughly the same time......... well you can't bomb everyone!

As they say in nuclear physics "gentlemen the fiat test is approaching "critical mass" (perception), please put on your safety googles". (Or phone USAGOLD and buy Au)

Mr GreshamBuena Fe: The Mailed Fist#5949608/13/01; 12:29:11

And that's what the $300 billion military budget, since the fall of the USSR, has always been about, hasn't it? "Laws? Treaties? Har-de-har-har. We keep the oil, we keep our gold, we bomb a few countries now and then... get it?"

"Well, at least that veil can come off our 'noble' image. We can't force you to trade with us now, but then, we've already gotten most of your goods that we can. And you'll be back in 50 years, or less, to "invest" in us and our "dollar" again. We pull it over on the international investors at least once a century."

Nothing to be proud of here. It's the Roman Empire, 2001-style. And not exactly in the service of its Roman-born inhabitants either. Time to read Gibbons again? Dr. King had a few things to say about the arrogance of nations. Right along toward the end, he did say quite a bit. Hmmmm...

Old YellerFacing reality#5949708/13/01; 12:50:38

"Estimated default probability is now assessed at 90-95%,up from 60% three weeks ago."

Sounds like a done deal to me,note how the article downplays the risk vis-a-vis Russia/LTCM of 1998.Seems rather implausible,given the other extreme stresses in the markets right now.

Anybody for a Turkey-melt?

Thanks to Winston for the link.

uponroofBarrons - Day of Infamy....... Jude Wanniski#5949808/13/01; 12:52:26

Wanniski has always written from this stand point. No news here. The real news is it's being published in Barrons no less. Can you feel the tide changing?

Gold is getting more and more good ink....

August 13, 2001

Other Voices
Day of Infamy
Learning the lessons of the fateful decision to close the gold window

On Monday, August 16, 1971, the day after President Richard Nixon devalued the dollar, cut taxes, slapped a 10% surtax on tariffs and imposed wage-and-price controls, I was assigned to cover the story for the National Observer, the Dow Jones newsweekly. I called the chief economist of the Office and Management and Budget, Arthur B. Laffer, invited him to lunch, and when we met outside the White House I asked him what he thought was the most important part of the package.

"Closing the gold window," he said without hesitation. "From now on it is not going to be as much fun to be an American." At the lunch, it became clear Laffer was on the losing side of the gold argument inside the Administration. The clearest winner was Treasury Secretary John Connally, who had been persuaded that economic growth required a cheaper dollar on the foreign-exchange market.

Laffer was one of three members of a "gold committee" that had been part of the planning of the overall initiative that stunned the world that Sunday. The other two were Treasury Undersecretary Paul Volcker, who went on to become chairman of the Federal Reserve Board in 1979, and Ken Dam, deputy White House chief of staff, who is today waiting to be confirmed as Deputy Treasury Secretary to Paul O'Neill in the George W. Bush Administration. The gold committee did not recommend closing the gold window, but it was overruled by Nixon's more senior advisers.

Then only 30 years old, Laffer had argued the cheaper dollar would mean only inflation, and greater expense for Americans traveling abroad. He said it would not alter the U.S. trade deficit with Japan -- which Connally was counting on, and that the U.S. dollar, no longer as good as gold, would cause American banks to suffer relative to foreign banks.

The proponents of devaluation were for the most part associated with the Democrats: Professor James Tobin of Yale and Fred Bergsten, who later held the top international post in the Carter Treasury where he argued constantly for an ever-cheaper dollar to boost exports and limit imports. Connally, of course, was a Texas Democrat whom Nixon admired.

The Tobin school argued that there would be very little inflation from the 13% dollar devaluation because foreign trade was only 5% of American commerce.

Thirteen percent of 5% is less than half of 1%, which is what they said would be the added inflation rate, which was thought to be well worth the increase in domestic jobs they promised Nixon would occur.

Laffer argued a 13% devaluation would mean a 13% inflation, over time. Five months later, Robert Mundell, who had been on the faculty with Laffer at the University of Chicago, made his famous prediction that we "would soon see a dramatic rise in the price of oil and thence all commodities."

It was Mundell's insight, based on his mastery of classical economic theory that had died out when it was blamed for the Crash of 1929 and the Great Depression, which gave rise to "supply-side economics," the term I coined in 1975 while a member of The Wall Street Journal's editorial board.

It was inflationary monetary policy that caused the dollar to lose 75% of its purchasing power relative to gold by 1973, when its price climbed to $140 from $35 per ounce in 1971, and when OPEC quadrupled the oil price to $10 per barrel from $2.50. The commodity inflation followed and then came the adjustment of the general price level, as nominal wages and profits eventually rose by a factor of 10 to match gold's rise to $350 (after a peak of $850 in early 1980).

It would be 1999 before the Swedish Academy recognized Mundell's contribution to monetary theory and awarded him the Nobel Prize in economic science.

When Nixon closed the gold window that August Sunday, there was still a promise that it would be reopened as soon as the markets adjusted to the 13% devaluation against gold. But the dollar/gold price kept right on climbing beyond the "official" price, and in 18 months the markets were "adjusting" to a 75% devaluation of the dollar. Connally had left Treasury, replaced by George Shultz, coming over from OMB, where he had been Laffer's boss.

Shultz, a labor economist from the University of Chicago, where he taught with Milton Friedman, persuaded Nixon to abandon any thought of opening the gold window again and try Friedman's monetarism. They had the backing of Citicorp's Walter Wriston, a Friedman admirer who had hired several dozen monetarists for the bank's economic unit. Instead of worrying about the foreign-exchange value of the dollar, the Treasury and the Fed would now concern themselves with the quantity of dollars created by the Fed, the money supply. The idea was to feed the banking system with a steady 3% rate of increase in the quantity of money.

What nobody understood at the time, including Nobel prizewinners past and present, was that the demand for dollar liquidity would change as the tax structure changed. Higher tax rates caused liquidity demand to shrink and vice versa. In 1979-80, the Fed was pouring liquidity into the banks while the inflation-swollen tax brackets and Jimmy Carter's credit controls were sinking the demand for money simultaneously. The Ms looked like they were behaving, but the velocity of money was going through the roof and so was the price of gold, hitting $850 in midday trading on February 1, 1980.

When it became clearer that Ronald Reagan would defeat Carter and then cut tax rates, the demand for liquidity rose and the price of gold began an 18-month decline to $300 from $850; the Fed was still fighting inflation when deflation had become the problem.

The 1981-82 Reagan recession was the worst since the 1930s and almost destroyed the economy and his presidency. The deflation ended in the week of August 11, 1982, when Fed Chairman Paul Volcker was faced with a crisis in Mexico, which could not pay interest on its $80 billion in debt to U.S. banks. He had to tell the Reagan Treasury he could no longer worry about the money supply because he had to monetize $4 billion in Mexican peso bonds. The price of gold rose $56 that week and the financial markets skyrocketed -- bonds, stocks, the S&P 500, with Nasdaq out front.

The experience should have persuaded policymakers even then that a floating unit of account could do deflationary as well as inflationary damage. Here we are again, though, puzzling at the odd behavior of the financial markets, debating whether the dollar is too strong or too weak, and not quite realizing how heavy a price is being paid by everyone on the planet for not having a fixed standard of value.

The average price of gold over the last 10 years has been roughly $350, but it is now around $270, a clear indication the Fed has again been engaged in deflationary policies that have accumulated over time. The deflation will surely be ended when it becomes painful enough, by accident or by design, but when it does come to an end, there really should be serious consideration given again to a new international monetary system with a link to gold.

Jude Wanniski is president of Polyconomics in Morristown, N.J.

E-mail comments to This email address is being protected from spambots. You need JavaScript enabled to view it.

BR549Sir James Turk#5949908/13/01; 13:21:26

FOA (msg#96)

FOA-"OH boy,,,,, did everyone read J. Turk's latest? I did and am carrying a shovel with his name on it. (smile),,,,, if I ever run into him I'll use it to cover the guy up with praise and admiration! Fine work and great conclusions!"
And in the very next paragraph you say: "Of course, the US still owns it's gold and has yet to ship any of it's official stocks of the same. A quick check of the ounces held in storage will confirm that. Any physical gold that has "walked from our accounts", to date, came from some other supplier."

Huh? Isn't the point of Mr. Turk's brilliant essay that the "Fed books" are going to show that the reported weight of the US Gold Reserve and the gold stock of the IMF remain unchanged with no apparent change on the balance sheets of Fed and the (ESF) Exchange Stabilization Fund? He contends that via either outright fraud or the invention of SDR and SDR Certificates that 40 tonnes per month beginning in September 2000 as being dishoarded by Fed? Turk's conclusion is: "Now it appears that perhaps as much as 7,000 tonnes (227.7 million ounces) has been swapped for essentially the same purpose – to intervene in the market to fight the truth, rather than admit that the dollar has again become very debased relative to gold."

He did not mention anything about "other suppliers". He did speak about the reclassification of deep storage gold, etc. If Turk is correct, and I think that he is, then physical gold possession by individuals is the only solution to the dilution of our national treasury by corrupt officials of our government. So do you agree with Mr. Turk or disagree with him? Did I misunderstand you or Mr. Turk?

Regards from Cornfield County

escapethematrixBR549.....Welcome, and some possible answers to your questions....#5950008/13/01; 14:04:01

Hey there, for what it's worth,this is my take on it. You asked…

----If Turk is correct, and I think that he is, then physical gold possession by individuals is the only solution to the dilution of our national treasury by corrupt officials of our government So do you agree with Mr. Turk or disagree with him?----

That is the main tenet of the FOA/Another view. Buy physical only, as the "paper marketplace" is driven into the ground. Thus, I would imagine that he does agree with him. FOA's message and perceptions seem to operate at quite a high level, which IMHO would place him a few steps ahead in knowing the real deal.

I would think the "other suppliers" FOA speaks of could be interpreted as: Countries, which had to part with their physical during times of "economic difficulties" in various bailouts and swindles. It would seem that this is the actual physical, which has entered the spot markets to keep the paper game going all along. Perhaps that is what is being shipped out from "various Fed accounts" at the 40ton per month rate?

As far as the US Government committing "fraud", I suppose it would depend on if the US honors, or walks away from, the SDR certificates, which encumber the US "reserves".

In any event "the Gold Trail" is indeed a long and winding road. If you haven't read it all, you should check it out. You'll probably find the answers you're looking for. Good luck, and good reading.

NetkingThe Dollar (R.I.P)#5950108/13/01; 15:05:03

Trail Guides latest "gold":
". . . Yes, the war now is between the Euro and the dollar! The Washington Agreement placed gold "on the road to high prices" as it signaled a phasing out of Euro support for our American gold values. How fast gold can, now, rise will gauge how much staying power the dollar has in all this. If there is any gold war now, it's to be in just how fast the dollar gold market can disintegrate into worthless
IOUs! . . . "

Netking > "The dollar's day is done & gold's has just begun"(heck that rhymes! . . I DO have some talent after all!)
PS: Trailguide also says: ". . . This action will scare most harden gold investors to death; especially the ones in leveraged gold stocks and lesser white metals! . . . "

Netking> The jury's still out on that last part, we can settle it on the price board in the days ahead yes(smile).

NetkingIsraeli troops mass near West Bank town#5950208/13/01; 16:26:50

Snippit: "Israeli troops began massing Monday night near a town in the West Bank as Palestinians braced for possible Israeli action following a Sunday bomb attack.

Israeli television channels broadcast pictures of troops, tanks and other equipment, and Israeli warplanes were said to be flying overhead.

The troops' purpose was unclear Monday evening. The Israel Defense Forces refused comment, saying it did not comment on operations. . . " - Netking

auspecSimply Me#5950308/13/01; 16:39:14

Unfortunately I am old enough to remember HeeHaw, yet also 'party lines' on the telephone, black and white TVs, as well as the polio scare for starters. Some of those HeeHaw girls dressed up like Daisey Mae were cuuuuuuuttties!
Must have been too distracted to notice BR549. Thanks for helping me out.


BR549Fed gold storage numbers correct or not?#5950408/13/01; 16:45:54

escapethematrix (msg#: 59500)

I love your Handle and thanks for the welcome.

My earlier statement: "If Turk is correct, and I think that he is, then physical gold possession by individuals is the only solution to the dilution of our national treasury by corrupt officials of our government." wrongly implied that Mr. Turk was for physical possession. That physical possession gold solution is mine, (I do not know about Turk's feelings about owning physical). I don't believe in any paper, equities, options, hedge funds, 401K's, mortgages, etc. Sorry, for such a poorly worded sentence earlier.

I guess where I am confused is: Are the stored gold reserves, (approx. 261.6 million ounces) reported by the Fed still physically there? Are they being sold and replaced? Or stolen from the American people via "legal" paper fraud?

I am not talking about acquiring or appropriating additional gold from other sources via bailouts, swindles, etc to temporarily boost the FRN or settle US debt accounts.

Also, is it logical that there is no fluctuation in the amount of gold stored by the Fed if gold is being acquired for the treasury? Or sold?

If you read Mr. Turk's article, he speaks only of physical gold in storage by the Treasury being dishoarded and provides balance sheet and gold fiat paper trail justifications.

Once again, if you believe the Fed's non-fluctuating gold storage numbers are accurate, then how can you agree with Mr. Turk's recent essay?

Canuck@ BR549#5950508/13/01; 18:00:27

From your latest.

"Once again, if you believe the Fed's non-fluctuating gold storage numbers are accurate, then how can you agree with Mr. Turk's recent essay?"

One thing that I have had difficulty with is understanding the proportion of foreign owned gold within the 'storage facilities' (is this 'earmarked'?). Let's start off with something simple; go down into the vaults (how many are there?) and count the stuff. This has not been done since sometime around 1973/74; and it is my understanding there are persons not comfortable with that 'audit'. So let's say there is 8100 tonnes, physically counted. It is also my understanding that alot of gold was shipped just prior to WWII, to the US for safekeeping. So is the foreign gold stored amongst the US 'reserve gold'? The movie 'Diehard' depicts various 'cages' marked with corresponding countries
with 'their' gold within. Is it like that and secondly, this is at the Federal Reserve in NY, yes? Is the 'foreign' gold in NY while US reserve gold kept at Fort Knox? I can't imagine it's that simple but on the other hand why can't it be?

OK....back to the count, there 'is' 8100 tonnes; X tonnes are US reserve gold, Y tonnes have been 'swapped' with Germany for whatever reason and Z tonnes belong to John Doe Inc.

I think the facts remain something along this line, I hope someone can expand on this:

a) no one, independant of top US brass, can verify how much is there.
b) who owns what (why don't they get it back?)
d) there is a convoluted accounting system; I would bet dollars to donuts gold (physical) is being double-counted statistically.
e) terminology is confusing and it changes so that the haze does not clear.

I think GATA and the boys, amongst other things, are trying to clarify the Martian accounting structure that the Fed/Treasury uses when stating it's gold ownership.

So going back to your statement, the first implies the second. That is to say if the FED/Treasury's numbers are correct then Turk and GATA and PGA's are incorrect and vice-versa.

Flipping the table completely upside down, if the FED/Treasury are not jerking the numbers and the jargon around, then an independant audit and accounting would be welcomed and the government could offer guided tours in the vaults for crying out loud. It is the peoples gold not the governments and you the people (you literally for I am Canuckster) have a right to know what's there, yes?

Why this 'smoke and mirrors act'?

Collateralize your fiat, prove to me that a dollar is a dollar. SHOW me backing, SHOW me what backs this debt-burdened paper. SHOW ME THE GOLD! My bank makes me SHOW the collateral, if I can't secure the loan I don't get the fiat. Why do you get the fiat, Mr. President? Can you secure it; SHOW ME THE GOLD! If you have it, you will not have a problem SHOWING us. The world is getting nervous, nervous of getting cents on the dollar, SHOW US THE GOLD!!

Knew you couldn't.

auspecBR549#5950608/13/01; 18:12:10

James Turk's premise is that the physical gold is still in US posession, but has been 'allocated' to other parties. We are now simply the fiduciary of the gold, and may or may not act 'honorably' later down the line.
It is very strange to be looking back on this issue having already taken place right under our noses, especially as the suspicions of this very act have been pervasive. Yes, we 'all' looked at the ESF, but mostly in regards to their $32B slush fund. Parcelling out 7000 tons of gold, all the while GATA and all the gold activists were breathing down their necks, constitutes a brazen action and utter disregard for the US 'rule of law'. Such a surprise {right}.
Now, who is to say this gold commitment must be honored when required? Only the continued viability of the US$ depends on it, and the $ remains in a precarious position still.
It just goes to show all how stripped down our sovereign country and its Constitution are. The Secretary of the Treasury is paid by the banksters, not the USG. The IMF and ESF are out of control tools of an unconstitutional Federal Reserve and its global network. They all have NO hesitation whatsoever in deceiving elected officials or citizens.
That strong dollar had a few Herculean pillars behind it, no?
For those who don't believe in conspiracies or the PE {Power Elite}, watch this thing unfold. It will be a true roadmap to international financial and monetary mechanisms.
Looks like we no longer have those 7000 tons of gold hanging over the market. The IMF is accountable to the US Congress, wonder how{e} long they can keep up their dumping? Scalps are going to fly!

CanuckPetition gaining ground today.#5950708/13/01; 18:24:27[partner_userID]=977161898&sign[memberID]=977161898&sign[partnerID]=1

Netking"Middle East war within six months" - says Russia #5950808/13/01; 18:30:29

Russian defense officials and strategists project that an Arab-Israeli war could erupt in the Middle East over the next three to six months.

The widely-held scenario described a war that would engulf Iraq, Jordan, Lebanon and Syria, according to Middle East Newsline. The officials and strategists said Egypt could be swept into such a conflict.

"We are moving inexorably toward a war," a senior Russian diplomat said. "Russia has tried and the United States has tried to stop this, but to no avail . . . "

Got gold yet? . . . call USAGold today! - Netking; 18:42:02

Hey there, Br549: I'll try to respond to your questions, but can only give you my interpretation of the situation.
Who really knows what's going on, and how it will turn out. All I can say for sure is that "The Gold Trail" offers quite the perspective to view it from as it all unfolds. First ----you--- then me.

----I guess where I am confused is: Are the stored gold reserves, (approx. 261.6 million ounces) reported by the Fed still physically there? Are they being sold and replaced? Or stolen from the American people via "legal" paper fraud? ----

Believe me, I'm pretty damn confused myself. All the Government misrepresentation and doublespeak is enough to give anyone a headache. Until "the big event" hits, it's all speculation. We'll probably find out fairly soon.
It seems to me that the gold is there physically, which would allow the static Government figures that are reported. Who knows since it would be such a bother to the Gov. to properly audit it :)It would seem that the SDR's are being and have been for some time, accepted as paper claims to said physical by various Oil producing Nations. The reserves seem to have been renamed to indicate to the Oil producers that the SDR claims would be honored as agreed, if necessary.It would appear that time may be close at hand. In any event, I agree 100% that either way the Gold is being stolen from the American people via "legal paper fraud".

---Also, is it logical that there is no fluctuation in the amount of gold stored by the Fed if gold is being acquired for the treasury? Or sold?---

It would only seem to make sense if all the physical is still there untouched, since delivery has yet to be demanded? Again, perhaps as TG has alluded to, the reclassification was meant to inspire confidence in our commitment to back our SDR's with real physical Gold, if absolutely necessary. As far as totally agreeing with Mr. Turk's essay, I think he reaches a few conclusions that may not take the "big picture"and, the "political will" of it all into consideration. In any event, it's a great bit of detective work, and one more piece of the puzzle. Hopefully with all the big brains around here, we can figure it out as we move along.

Take care, have a good night.

Black BladeA lack of vision is all too visible#5951008/13/01; 18:42:15


The fog of uncertainty cloaking US companies is thicker than ever - and drifting east across the Atlantic. Companies that spent much of the 1990s boasting about "the vision thing" are suddenly complaining about a collective "lack of visibility" - of orders, inventory and demand. The number of companies that has blamed what used to be a weather condition for their inability to prosper has exploded in the last six months.

Bill Meehan, chief market analyst at Cantor Fitzgerald in New York, says lack of visibility is not just an excuse: "Nobody that I know of, including the wizard behind the curtain Mr [Alan] Greenspan, has a clue where this economy is going." But he concedes that some companies may be using the term to "forestall telling the honest truth". For those companies, the fear must be that when the fog lifts, their problems will become all too visible.

Black Blade: The Pied Pipers may be blind, but it really is quite clear. It is the "R" word - RECESSION! We have slipped into recession and no one wants to admit the obvious. These clowns can use these euphemisms like "visibility" all they want. The economy is toast and anyone with a couple of brain cells to rub together would be able to see it. It is very visible as all the signs are there. Declining earnings, declining productivity, corporate layoffs, rising costs, loss of consumer confidence, growing debt, slowdown in consumer spending, etc. etc. etc. There is no lack of "Visibility," only a lack of honesty.

milos(No Subject)#5951108/13/01; 18:42:41

To reclaim Treasury gold US citizens should redeem their tax refunds for physical so it remains in the country. Let the smart asses figure how to obtain it without loosing market control. This will not only fix the problem but remove control from their slimmy hands.
Tree in the ForestCanuck: Auditing Fort Knox, Netking: War in six months#5951208/13/01; 19:01:16

Welcome to all new posters and to all returning posters.

Canuck: No sense auditing Fort Knox now; we have no gold there! If the countries who own that gold are concerned about it, let them audit it.

Netking: War in 6 months? How about war in 6 days! I don't think this thing will wait 6 months.

slingshotMilos Msg#59511#5951308/13/01; 19:07:07

My thoughts exactly. Cut off another avenue of escape.They can not use what they can not get their hands on. Sorry to say, the tax rebate will be used to pay off bills,buy school supplies or dumped back into the stock market.

Black BladeRecord U.S. natgas drilling fails to hike output#5951408/13/01; 19:18:41


NEW YORK, Aug. 10 - Soaring natural gas prices last year spurred record drilling, but production in the United States is only marginally rising as old fields deplete at ever-accelerating rates, analysts said Friday. The industry will get no relief in the near term, as natural gas from new fields is years away from reaching the market.

A recent survey by consulting firm Andersen of 155 of the world's biggest publicly traded oil companies found that their spending on exploration and development in North America rose by 72 percent to $36.2 billion last year. Yet natural gas production increased by only about 1.5 percent in the United States in the past six months, according to analysts.

"That's pretty phenomenal given that we've had record gas drilling activity," said David Pursell, analyst at investment bankers Simmons & Company. "That's showing that base gas production is declining very rapidly and it also speaks to the quality of the prospects that are being drilled." The latest report from oil services firm Baker Hughes (NYSE:BHI)showed that 1,047 rigs were drilling for natural gas in the United States last week, compared to the 647 average of last year and more than double the 426 average from 1999. "Prospect sizes get smaller and decline rates go up and it's harder to show top line volume growth," Pursell said.

Black Blade: As I said - natural gas is the real "sleeper" in this growing energy crisis. Decline rates in the natural gas fields are accelerating and increased drilling activity has not resulted in increased natural gas production. Yet all new power plants are NG-fired. We face an energy crisis of epic proportions that threaten life as we have come to know it in the US. We take energy for granted and yet we cannot live without it in the modern world. This recession has a long way to go and as we try to build more "Cheap Energy" capacity to no avail, this recession will make the recessions of the 1970's and 1980's pale in comparison.

Black BladeIsraeli Troops on the Move?#5951508/13/01; 19:25:07

Just heard on the news that Israeli tanks are moving on the West Bank. Can anyone confirm?
NetkingTree in the Forrest#5951608/13/01; 19:38:09

Tree, You may well be right brother . . . I guess all divergent parties are now saying the same thing(rare unity huh!) . . . . a concern to those wanting peace and a confirmation to where things are heading. . . quickly.

I guess one of the few positive outcomes (given that scenario)is what will happen to the POG/POS.

NetkingBlack Blade#5951708/13/01; 19:39:52

BB - Post #59502 carried the last the I saw in this - Netking.
slingshotBlack Blade#5951808/13/01; 19:49:40

World Net Daily has a story from BBC stating tanks roled in and fired on a police station in Jenin, Tuesday morning.

NetkingIDF tanks enter heart of Jenin; Heavy fighting reported#5951908/13/01; 19:50:11

Israeli tanks entered into the heart of the Palestinian-ruled West Bank town of Jenin early on Tuesday and took over a building belonging to the town's governor, Palestinian witnesses and security officials said.

"This is a declaration of war," Palestinian Information Minister Yasser Abed Rabbo told Reuters . . .

annieWar:#5952008/13/01; 20:47:43

Seems none of the networks, cable are carrying any news. Anybody seen anymore news? TIA, annie
uponroofWAR...and rumours of war#5952108/13/01; 21:01:59

Heavy Exchanges of Fire in Center of Jenin
Early Tuesday After Israel Tank Forces Enter N. West Bank Town and Take Over Palestinian Institutions, Including Palestinian Authority Government Building This is First Israeli Army Entry to Town Under Full Palestinian Jurisdiction It was Launched Against Jenin as Stronghold of Militant Hamas in Reprisal for Deadly Suicide Bomber Strikes in Israeli Cities One Tank and Armored Infantry Column Advanced from South to North – A Second Entered Kalanswa Refugee Camp and Knocked over Palestinian Position – A Third Reached Kabitiye Palestinian Authority Loudspeakers Called on Jenin Population to Resist

Christian(No Subject)#5952208/13/01; 21:08:31

BIS=UN central bank. IMF=UN finance ministry. US Treasury Secretary is in charge of settling our trade deficit with the world through BIS with gold at $540 an ounce because it is the only thing they will take. Our trade deficit has been settled with physical gold now for more then 25 years. Our value of the dollar is the physical property we the people give in order to gain fiat $'s to buy things with. This growing debt value will force the dollar to become stronger and commotities weaker. People will be forced to save in their attempt to keep a roof over their heads. Every day a number of new hedge funds come to life using the ever lower commodity prices (short position) to fund their operation. It now takes $15 of new $'s to gain $1 of GNP. Of that $1 of GNP, more then half of it is nothing but BS GNP. Hedge funds do not contribute anything useful to the GNP. Our economy is made possible by an expanding debt structure. Our purchasing power is depended on the ever reliquification of that ever expanding debt. WE as a nation of tapped out debtors are now stressed to service that debt which has reduced money available for purchasing what we produce. This country is in the early stages of a nation wide garage sale (deflation). This garage sale consists consists of wilderness areas deeded to the UN for debt reduction. The UN already owns more then half of all of Russia's forests, owns millions of acres in USA and large tracts of land in many Latin American countries.--- Credit creation gold made up of a bundle of commotities ( metals, fuels, grains and housing) is what backs the ever increasing debt and makes the dollar have value. If you want to sleep tonight in a bed with a roof over it you are going to have to pay for it with $'s..... Gold is monetized as a vehicle debt creation and we the people had better figure out how to use it to our not their advantage. We had better figure out how to make interest payable to ourself or forever be serftitute to our central banks. How did it happen that we are so smart yet so stupid. Usury is a factor which makes a contract illegal. Yet we the people so smart sign on the dotted line every day and sign over our physical property in exchange for fiat $'s. How stupid can a people get. Are we so incompetent as not being capable of handling our own affairs?????
BR549One last Turk#5952308/13/01; 21:39:02

escapethematrix & auspec & Canuck & FOA—

I get it! "Is" doesn't necessarily mean "is".

So just because the Feds sell the gold doesn't mean that they deliver the physical gold. They only deliver paper SDR Certificates which are derivatives of SDR's (paper) so therefore some of the physical stored gold reserves, (approx. 261.6 million ounces) reported by the Fed has been sold or swapped but is still physically there??

Let's get a GATA inventory and see!

Black BladeIsraeli troops attack Palestinian town#5952408/13/01; 23:47:55


JENIN, West Bank (CNN) -- Israeli troops withdrew from the Palestinian-ruled town of Jenin early Tuesday after an incursion a Palestinian diplomat warned would open "the gates of hell." Israeli troops destroyed a Palestinian police post and surrounded the town governor's office during the raid, Palestinian security sources said. It was the first time the Israeli army has gone into an area of the West Bank under direct Palestinian control and taken over a main government building during the 10-month-old Israel-Palestinian struggle. The Israelis withdrew from Jenin after less than four hours. Three Palestinians were wounded in the incursion, Palestinian sources told CNN.

Black Blade: One of these days it will be more than just an incursion. There have been calls by some in the ME to "punish" the supporters of Israel by cutting of the flow of oil. I doubt that will happen though as Arab members of OPEC depend on the oil trade to support their social programs. But still, it could happen. Parties on all side appear to be hell bent on stirring up the pot.

OROTen Bears, others - will post as time permits #5952508/13/01; 23:48:43

Time is shorter than expected this summer, thus posts stand partially completed and are no longer timely when I return to them. My reading can barely keep up with FOA's postings. Hopefully, a week long "window" should open next week and perhaps the week after. If so, I will indeed resume posting for that short while, and again when my schedule clears up towards fall. A few hours today (tuesday) and next might result in a post or two.
TEXSurfacing For Some Air#5952608/13/01; 23:57:21

Peeking out for a quick look around. Nice rise in the POG since I surfaced last month. Other than that.....HEEEEEEE HAWWWWWWW.......keep up that pickin and grinin!
Black BladeTyco to Cut 11,300 Jobs, Shutter Plants#5952708/14/01; 00:04:12


BOSTON (Reuters) - Tyco International Ltd. (NYSE:TYC) plans to cut nearly11,300 jobs while closing or consolidating nearly 300 plants in connection with acquisitions made during the previous and current fiscal years, according to a U.S. regulatory filing made public on Monday. As of June 30, Tyco said it had eliminated 6,379 employees and closed or consolidated 58 plants from companies acquired during fiscal 2001.

Black Blade: The "Bone Pile" grows. Tyco screwed up and made several ill-advised acquisitions that hit the bottom line hard. Not long ago, David Tice railed against the company's questionable accounting practices. The Pied Pipers took exception. Looks like he has been vindicated.

Black BladeCitigroup Firing 3,500 Employees as Financial Markets Slump#595288/14/01; 00:30:04


New York, Aug. 13 (Bloomberg) -- Citigroup Inc. is planning to eliminate 3,500 jobs in the coming year as slumping financial markets bite into the largest U.S. financial-services company's profit.

Black Blade: More carcasses for the "Bone Pile." The stench is getting very thick.

Black BladeMidway Air Cuts 700 Jobs, Trims Service#595298/14/01; 00:37:47


RALEIGH/DURHAM, N.C. (Reuters) - Midway Airlines Corp said on Tuesday it is cutting nearly 700 employees, discontinuing service to nine cities and shedding 17 aircraft from its fleet as it deals with a tremendous drop in business traffic. The company said the moves are in connection with its filing for relief pursuant to Chapter 11 of the U.S. Bankruptcy Code. Midway said it has experienced a ``calamitous drop in business traffic'' this year, particularly in the technology rich Raleigh/Durham, N.C. area, where it is based.

Black Blade: That's more carcasses for the growing "Bone Pile." Not a good sign of the so-called "robust" economy as the Pied Pipers call it. A bit of Gold for insurance maybe.

skiBR549 ... your PM manipulation question#595308/14/01; 01:59:16

You twice asked about PM manipulation as it relates to current market price. I usually spend a very long time THINKING about an issue and only a short time before I ACT on my conclusions; perhaps the opposite of the current investment crowd. So here goes.

In the world of investing, I no longer hold the view that some markets are manipulated but now hold the view that ALL markets are manipulated to varying degrees. If a farmer takes the time to polish his apples before taking them to market, is he not attempting to manipulate the buyer? If you wear a T-shirt that says "Eat at Joe's ... Best food in town", aren't you manpulating the dinner crowd? When your house is up for sale and you and your wife knock down the cobwebs and paint the porch, haven't you both conspired to manipulate a potential buyer? Do you remember PET ROCKS back about 1970? Ordinary rocks got mighty expensive. When you get right down to it, virtually ALL SALESMANSHIP and ADVERTISING are inherently manipulation! Manipulation is everpresent.

Most contemporary discussions of the gold and silver markets include at least some text on manipulation ... pro or con. I have great respect for professional people armed with the FACTS as opposed to ordinary personal OPINIONS from busybodies. GATA, Butler & Veneroso all clearly seem to have the facts to support a widespread and long-term manipulation. I have long agreed with their observations. The resultant degree of market distortion due to the manipulation is both profound and historically extreme.

Now for the clincher, "I am positively delighted at the possibility of capitalizing on this mega market distortion." How is that? My thinking goes like this, "The greater the degree of market distortion (manipulation), the greater the degree of subsequent market correction that MUST correspondingly occur when the natural laws of supply and demand reassert themselves."

Like most other investors, I wish that I had known about the extreme PM manipulation from the 'git go', as I would have waited much longer to make my moves. But the last time I checked, not a single one of us can undo the past. The real question them becomes, "IN LIGHT OF THE ONGOING, EXTREME PRICE MANIPULATION IN THE PM'S, WHAT IS THE BEST INVESTMENT STRATEGY GOING FORWARD?"

I have an active collection of investment wisdom primarily from World Investment Professionals that I call "Golden Nggets." Found below are the selected 'nuggets' that I think best address the above question.

115. B. Dohmen "Stay with an investment decision until prices rise or the facts prove you wrong." (Ski ... Neither of these two conditions have yet taken place in silver or gold.)

87. D. Dreman "NONE of us can escape the anxiety and doubt that permeates a crisis."

18. B. Dohmen "If you wait till their is nothing to worry about, you'll wait util eternity ... take your position and use stops to protect capital."

100. Ski's thought: "A great speculator looks for "REVERSE BUBBLES" (the exact opposite of BUBBLES or MANIAS) where everything that can possibly go wrong over an extended period of time (at least several years) HAS and the bear has fed upon itself to a point of hyper pessimism."

93. D. Casey "You are only likely to get 1,000 percent returns over a business cycle in those investment areas that have already crashed and have hit bottom."

96. Sir J. Templeton "Bear markes start at the point of maximum optimism and bull markets start at the point of maximum pessimism."

94. D. Casey "Make fear your friend."

91. J. Dines "A way to make money in the stock market is to find an area with explosive growth and mind-boggling potential; then investing in it as early as possible."

3. J. Bernstein "(no matter what expert writings' you study) .... we always arrive at the inescapable conclusion that profitable trading in stocks and futures can only be achieved by individuals who are either extremely fortunate or extremely disciplined. Discipline is a rubric under which are subsumed such quintessential skills and qualities as self-contol, consistency, organization, persistence, direction, insight, and the ability to take action when necessary. Unfortunately these are skills which cannot be learned easily or quickly."

176. Sir J. Templeton "Looking for a good investment is nothing more than looking for a good bargain."

214. D. Dreman "In a crisis, carefully analyze the reasons putforward to support lower ..... prices. More often than not they will disintegrate under scrutiny." (Ski ... This seems to be exactly the case in today's silver market ... no authentic reasons for lower prices.)

So ... Sir BR549, where does all this leave us? Theoretically, the PM manipulation can continue until the last remaining ounce is leased. In the case of gold, it could still be quite a while. In the case of silver, the game is apparently almost over. (Although both games could end tomorrow.) Maniplation or not, I will continue to accumulate PM's at these ultra bargain levels and will remain most thankful for this rare investment opportunity.

justamereBearSki#595318/14/01; 03:44:13

Some wise words. There are not many instant gratifications, particularly without side effects. You pay for everything one way or another, and I expect in this case it is patiece. (or frustration, take your pick.)


justamereBearBlack Blade#595328/14/01; 03:48:27

And what does the drop in Midways business travel say to you? Is it because they have so much they are not now required to travel, or that there are so few deals that there is no reason to travel, or that the community is so tight that they can't afford it?


justamereBearAnnie#595338/14/01; 04:11:18

I don't think I have seen such a welcome as you have recieved. Let me add my small voice to the thunderous ovation. The origional I missed due to other commitments, so it must have been good. But I think more of what you bring to the table is needed around here. That artistic thinking "lets turn it upside down and see what it looks like that way."

From one (somewhat unknown) artist to another. welcome. I like some of your questions. (thinking)


wolfPetition : Give it your support#595348/14/01; 04:20:45

Clarify US.Policy on Gold and Gold Accounting :

Signatures so far : ONLY 1.435

Goal : 10.000

Deadline : ongoing .....

Canuck@ Tree in the Forest#595358/14/01; 04:26:20

That's an excellant idea; other countries could press for
an audit!

CanuckAnyone?#595368/14/01; 04:27:47

How are the Swiss sales going? Very quiet lately. What about firing the BIS, where does that stand?
Canuck@ BB#595378/14/01; 04:46:09

Just in case I haven't told you lately, you are the man.

Up in Canuckville we have our version of CNN/CNBC called ROBTV (Report on Business TV). It is less spirited that your version (I may be a little biased) but seems to be more believable. I must admit there are no 'Maria's' or 'Sue's' thus the cast is not as visually pleasant.

Last night's guest was an 'income and royalty' trust analyst. He was awesome. He gave one of my trusts a 'thumbs up' and was rather 'neutral' on the second. The highlight was his mentioning of a trust that was 'overweight' NG.

He was short term 'hold' on NG but long term ultra-bullish in regards to natural gas. Off to check this trust.

Thanks again for the notes.


P.S.: I respect your angle on advice; you won't advise a stock or fund, but will reveal what you hold. That is very prudent.

annie@JustamereBear#595388/14/01; 04:58:41

Your artist-to-artist welcome makes me feel very special indeed. And you know how we artists like to feel "special"! I am always interested in sharing ideas with other artists. I would love to have an email correspondence. If you are interested, email me at This email address is being protected from spambots. You need JavaScript enabled to view it. .

Thanks again for the wonderful welcome from all here. I recognize the posters on gold bug sites as true free thinkers and intellectual elite and am daily in awe of the knowledge that is shared here. Thanks to all for allowing me to be a part of this.

annie@ski#595398/14/01; 05:19:50

Loved your post! You are spot on about manipulation in both senses: in the broad sense it is used by all of us every day. We manipulate our kids to make good grades by encouragement and praise. And. All markets are manipulated to some extent.

A couple of years ago, when I was just getting into the "goldbug underground", I was very thoughtful about this "manipulation" thing. In a discussion regarding POG vs. strong dollar, I was told that "...a certain amount of manipulation is appropriate." Okay. But who draws the line? Who says, sorry, you can't do this because it goes too far? Who keeps the super wealthy from using their puppets and their prior knowledge to profiteer?

All said, manipulation does go on, often out of public view. And in a corrupt society such as ours (worldwide), it is to the detriment of all except the puppeteers--the super wealthy.

And, you are correct that the best we can do is to "...follow in the footsteps of giants...." What GATA is doing may bring this to fruition sooner than would happen otherwise, but the rubber band effect you speak of is gonna snap pretty hard.

Enjoyed your nuggets--especially the one about Reverse Bubbles. My second favorite: 96. Sir J. Templeton "Bear markes start at the point of maximum optimism and bull markets start at the point of maximum pessimism."

ski, thanks for your post.

BR549"Pickin’ and Grinnin" #595408/14/01; 05:48:38

TEX (msg#: 59526)-

"Pickin’ and Grinnin" my way through life. I used to have a Sales Manager who worked for me when I was in the "real world" who I noticed hadn't scheduled his vacation for the year. He had a great sense of humor and worked his butt off. When I asked him when he was going to take his vacation, his response was—"I take a little vacation every day". Me too, and if you can't have fun, what's it all about.

Regards from Cornfield County

Black BladeRE: Canuck and J-Bear#595418/14/01; 05:59:14


Energy trusts can be good for current income and have some favorable tax treatment as well. The Canadian version apparently has a few more perks. I am not aware of any PM version though. There are royalty companies such as Royal Gold and Franco-Nevada.


As far as Midway is concerned, business travel just "Dried Up." Companies are cutting back on travel and some now are more likely to teleconference. These are cost cutting measures. There is a "Price War" coming after Labor Day. The major airlines are going to aggressively slash prices as there are now too many empty seats and few business travelers. Business travelers (business class) accounts for only one third of the passengers yet they account for two thirds of the revenues. The economy is responding to the "non-recession" recession.


- Black Blade

BR549Golden Nuggets#595428/14/01; 06:27:00

ski (msg#: 59530)-

Another brilliant post by Sir ski on the art and science of capitalizing via disciplined investing in today's manipulated markets. Indeed throughout recorded economic history, supply & demand raises its massive head and eventually crushes the market distorters.

These Golden Nuggets of ski's are required reading for those putting their capital at risk in these uncertain times.

Black BladeForget the Second-Half Recovery#595438/14/01; 06:35:52


Every time I hear a typical analysis of the U.S. economy in 2001, with its components of global recession, investment collapse, falling profits, record deterioration of household balance sheets, and the rising need for companies to lay off more workers, I wonder when the analysts are going to lower their U.S. growth forecasts for the second half of this year. Notwithstanding a positively awful set of economic conditions, most forecasts from investment firms call for a 1, 2, 3 scenario: 1 percent growth in the second quarter, 2 in the third, 3 in the fourth.

The "easy as 1, 2, 3" recovery outlook is beginning to look like a bad joke. It is based on the simplistic notion that 275 basis points of Federal Reserve easing since the start of this year, together with a combination tax cut-rebate that adds about $40 billion to household income in the third quarter, will boost spending enough to justify the 1, 2, 3 scenario. That reasoning is both unsound and disingenuous. No one really knows how much-if at all-these standard countercyclical measures will boost spending and over what time their effects will appear. The rapid Fed easing has done nothing to arrest the slowdown in investment spending, the most serious problem so far in this atypical U.S. economic slowdown. Rather, rate cuts appear to have helped sustain a high level of household spending on autos and housing, but one result of that sustained spending has been a sharply elevated level of household debt. Interest payments on consumer installment debt are soaking up 3.1 percent of disposable personal income, by far the highest level since 1968, when a continuous data series began. As a result, U.S. consumer installment debt is also at a record high, 22 percent of GDP, while total consumer and corporate debt has reached 135 percent of GDP. With debt-service burdens at record levels relative to incomes, will U.S. households keep spending and running up more debts just because the Fed has pushed short-term interest rates down to "neutral"-that is, neither stimulative nor contractionary-levels and a check for somewhere between $300 and $600 arrives from the Treasury this summer?

Black Blade: DITTO! Can you say Recession? I knew you could!

Black BladeSTOCKS ARE JUST ABOUT OUT OF LUCK By JOHN CRUDELE #595448/14/01; 06:41:56


August 14, 2001 -- THE stock market rallied right on schedule last week, and the newest load of awful economic news will probably keep investors psyched for another week or so. The Federal Reserve has its regular meeting next Tuesday, and Wall Street now expects more than just one more rate cut. Until a few days ago investors had been anticipating one last cut - the seventh - and they then expected the Fed to lay off the economy. But last week's "Beige Book," in which the Fed summarizes economic activity throughout the country, was so disappointing that additional reductions in interest rates are now expected.

Black Blade: Good Bye "Wealth Effect." All that wealth gone to "Money Heaven." Of course even now, the markets are absurdly overvalued.

annieInterest rate cuts#595458/14/01; 07:00:16

I have hypothesized before, without comment, that the Fed has "other" reasons for rate cuts. Other than encourage capital investment to reverse the downtrend and positively affect economic psychologies.

What about this: To save the financial institutions--temporarily. Non-performing loans--what an innocuous term--must be increasing geometrically. The past several years how many "financial disasters" have been skilfully swept under the Fed's great big rug? Look at the delta banks have between interest in and interest out. Doesn't this have to be huge?

And. When the stooges on CNBC talk about the financials, how could they not realize that this cycling down is going to take out some of them.

Okay. I don't know a lot about this stuff, so comments, please.

justamereBearBlack Blade Annie#595468/14/01; 07:52:38

BB Can you say recession/Depreesion? I knew you could (The deadly D word)

Annie Short note on its way 2 minutes Thanks

BR549GE Jack's PR Machine#595478/14/01; 08:55:04

GE (that's General Electric) Jack's (Walsh's)PR Machine--

Oh, well it's back to business as usual with the "please, God don't let my teleprompter fail" types at CNBC.

Mark Shields and a few others tried to do the right thing for a brief (and I mean brief) period of time by asking their "somebody buy this dog my firm represents analysts" what they liked? After providing accolades and terrific reasons to buy these wonderful stocks, they were ask by Shields "if they owned it". In a remarkable coincidence, 100 per "shent" of them admitted that they did.

More and more it's, pump and dump again along with a constant tracking of GE news/price movements. Guess, they couldn't get any of these expert analysts to come on any more. How embarrassing for these experts to even be asked. And likewise for CNBC to attempt to try to do the right thing.

Of course, when gold goes down that is immediate news. When gold goes up, at the end of day it is reported that this is just because the dollar has temporarily weakened and after all, gold is priced in dollars. Then they run specials on "Fool's Gold" etc.

Tannehillfrom The GoldenBar report @ Fool's; 09:19:02

Here is the flavor of the article, more at the link above:

"Cheryl Strauss Einhorn had it backwards in her Barron's article, of the same name, this week when she wrote about the doubtful endurance of the aspiring bullion bull market. Fool's gold, from what I'd learnt on my geology fieldtrips, is not really gold. It is the stuff that we line our walls with when it becomes worthless, kind of like the new economy.

It is the stuff that central banks create on top of a small quantity of real gold… and it is ironic that by beating up the gold sector, today's paper bulls think that they have half a chance at bidding up the dollar, stock market, or conceptual (Greenspan) GDP for that matter. But the more the merrier… fodder for the emerging bull market in gold. This is not all there is to it. It will end when Ms. Einhorn turns bullish (jab)..."

Original thought for the day, have you ever looked down to see what is in the footsteps of giants that you might be following? Go ahead, take a look. I'll wait


That's right squashed goldbugs. Why do you think that is?

That's all from Tannehill

site stewardWGC's summary of the past week's notable action in the gold market#595498/14/01; 09:28:23

Of particular note, abolition of VAT on gold has become a hot topic in Korea, which is currently 10%. According to the WGC, the parlimentary discussion is scheduled to continue in December, and that "a head of steam is developing, with some members of the ruling party espousing the need to abolish the tax."

Notice a growing trend here, boys and girls? Call it the result of "international political will". And the white metals remain consspicuously absent... (but if you insist, Centennial will be happy to help you obtain them at good prices, just like the yellow stuff!)

Tommy PThe IMF is saying nasty things, about the U.S Economy?#595508/14/01; 09:46:43

Wow, who ever thought this could happen?
Hill Billy Mitchellski @ # 59530 and annie @ # 59539#595518/14/01; 09:47:52

Sir ski,

You asked and you said, "…haven't you both conspired to manipulate a potential buyer? …When you get right down to it, virtually ALL SALESMANSHIP and ADVERTISING are inherently manipulation…"


Lady annie,

You said and you asked, "…You are spot on about manipulation in both senses: in the broad sense it is used by all of us every day. We manipulate our kids to make good grades by encouragement and praise. And. All markets are manipulated to some extent…But who draws the line?" Who says, sorry, you can't do this because it goes too far?


My thoughts: I would like to draw a line in the sand. First let me offer the definition of the word, manipulation, according to Webster's 7th New Collegiate Dictionary – To control or play upon by artful, unfair or insidious means.

There is a danger, in my estimate, in broadening a definition to such an extent so as to become rather all-inclusive. So let us draw the line. In the above definition the word, unfair, is a critical one. Further the word, insidious lays out the heinousness of the word manipulation. Put unfair and insidious together and we get arrive at a means to an end. The end is to deceive and to deceive generally entails harm and the means is that of manipulation. The end does not always justify the means. I am going somewhere with this.

To lump POG manipulation or any market manipulation, for that matter, with the example of a husband and wife CONSPIRING to manipulate a potential buyer, by knocking down the cobwebs and painting the porch, is going over the line. This is where the line must be drawn. The questions must be asked: Is there intent to do harm? Is there intent to deceive? Is there intent to get gain at the expense of another?

"If an exchange between two parties is voluntary, it will not take place unless both believe they will benefit from it. Most economic fallacies derive from the neglect of this simple insight, from the tendency to assume that there is a fixed pie, that one part can gain only at the expense of another", says no smaller giant than Adam Smith in his masterpiece, "Wealth of Nations".

Let us draw the line here, lest we put our stamp of approval upon manipulation. I say this with a loud NO, NO, NO!!! Emphatically I say that "ALL SALESMANSHIP and ADVERTISING" is not inherently manipulation. When one takes a word like manipulation and broadens the word out to encompass any and all activities in which an exchange between two parties is involved one has gone to far.

It is bad enough to minimize the heinousness of the crime being perpetrated upon the public in the manipulation of POG. Why stop there. Why not go into the abyss with this thought. Are we to take it that motives are not to be considered, when accusing someone of manipulation? One might as well say that even though there is no intent to deceive, no insidious plan to do harm for personal gain, that when one induces another to make a voluntary exchange, manipulation is always involved?

What about God? Is He the grand manipulator of us all? Could the possible motives of mercy and grace not refute the charge that His attempt to induce us into the great exchange, "The exchange of our sin for His righteousness" is manipulation on His part. God forbid that we fail to draw the line before we render the whole of life and eternity to become sad exercise in conspiracy and deceit.

Let us call a spade a spade. When it looks, smells, feels, and quacks like a duck, it is a duck. God is not a duck. Every time an exchange occurs, WHETHER OR NOT SALESMANSHIP AND OR ADVERTISING ARE INVOLVED, manipulation need not be inherent.

Sir ski, the point you were making did not go over my head. You are quite right, IMO, in that the great manipulation of PM's presents a fantastic opportunity upon which contrarians may capitalize. May I quote you as I attempt to "sell" but not "manipulate" all my family and friends by asking them your question, "IN LIGHT OF THE ONGOING, EXTREME PRICE MANIPULATION IN THE PM’S, WHAT IS THE BEST INVESTMENT STRATEGY GOING FORWARD?"

Annie, when you asked, "But who draws the line?", you provided the springboard for this post. I was thinking, "A line must be drawn in the sand on this idea." I was thinking, "Someone must draw the line and it might as well be me." As I began to put my thoughts together I discovered that the line had been drawn in both the economic realm and in the spiritual realm long before either USAGOLD or I arrived upon the scene. Adam Smith drew the line in the economic realm. God drew the line in the spiritual realm.

Annie, I repeat part of your question and I offer an answer. Your question: "Who says, sorry, you can't do this because it goes too far? " My answer: Any manipulation is going too far. Manipulation entails unfairness, deceit, and intent to do harm and sometimes involves conspiracy. If unfairness, deceit, coercion or intent to do harm is involved when inducing children to get good grades through some sort of dishonest encouragement or false praise, then I say, we must not do it. It is wrong. If you have been told that a certain amount of manipulation is appropriate, you have been told wrong. If parents induce their children to do the best that they can by providing them incentives to do so and the parent's motives are not tainted with i.e. "how good the parents look their children make good grades", I can assure you that what the parents have done is not manipulation but rather edification.

I know that you would not tell your daughter that being a little pregnant as a teenager is ok. Neither should tell her that a little bit of manipulation is ok. The last time I held down a W-2 type job, my boss, told me that my problem was that I held everything to be either black or white, and that in the business world, some day I would discover that there is such as a thing as gray. That was 16 years ago. Today we have great respect for each other. I never changed his mind and he never changed mine on the matter of "black and white and gray". When I left his employ he told me, "Because you refused to acknowledge gray, I always felt safe with my assets in your charge." That brought tears to my eyes. That was when I discovered that he had understood all along and that I would have broken his heart, had I dropped my guard in the area of no compromise between right and wrong, good and bad. His compliment was the second greatest compliment I ever received.

Very respectfully,


PS: Adam Smith's ideas of a non-fixed pie derive from the Holy word of God also. So, you see, It was not even Adam Smith, who drew that line, the line in the economic realm, though we owe him for bringing the matter to light in such a clear and unambiguous way. God has drawn all the lines. All of the answers can be found in His holy word.

site stewardIMF says dollar at risk of sharp decline, euro climbs above .90 to 3-1/2 month high#595528/14/01; 09:50:38

Reuters reports in this article: "The IMF said in its latest annual assessment of the U.S. economy that the current account deficit was unsustainable, and the greenback was at risk from a sharp depreciation."

AND... the dollar has fallen against the yen, too, despite the BOJ decision last night to further loosen its "ultra-easy" monetary policy.

You will want gold to see you through this transition.

Hill Billy MitchellOne more rate cut please!#595538/14/01; 10:07:41

Sir Greenspan, One more rate cut please!

See above link. You are looking at the results of these extensive rate cuts by the US Fed while the rest of the world Central Banks hold thier ground.


site stewardFed adds reserves, FOMC target not violated#595548/14/01; 10:15:44

Yesterday and today the rate was on target for the trade of overnight funds.

Still, the Fed was compelled to add $2 billion via 28-day repos and $3.75 billion via overnight RPs yesterday, while today it added $6.5 billion to banking system reserves using 2-day repurchase agreements.

Might these be compulsory actions to offset the withdrawal of big players from the dollar world? Or perhaps when that day arrives, the Fed will be monetizing assets in earnest, as though these current actions were nothing.


KnallgoldNo WA2 out of Genoa#595558/14/01; 10:19:08

But:has there been a "Silent Agreement" to let the Dollar down? It is important what they don't say'says theBelgian.It seems so.And the market says so.Will it/can it be still the controlled burn?
Hill Billy MitchellLook at this link#595568/14/01; 10:28:54

And tell me that the London Market is in charge!

What I see is that the New York Market is and has been in charge for several months. When this changes, when the huge moves consistently occur after the New York close, the gig is up, IMO.

"Thunder in the night", means while the New York markets are closed, no?


Hill Billy Mitchell; 10:35:42

See above link.

Look at the Euro and Yen charts!

Expect major US currency intervention soon. No problem, it has never worked.


Hill Billy MitchellCorrection of last post#595588/14/01; 10:37:31

Sorry, I put the link in the subject area.


CoBra(too)Black & White - and some Grey#595598/14/01; 10:37:47

HBM - your post to annie and ski touched a chord with- (in) me.
There used to be a time in my life when the word of your business friend of integrity was all you needed, like handshake quality, even better than a written contract, which today may be at the mercy of your or your business 'friend's' lawyer interpretation.

I recall being absolutely stunned by agreeing verbally on a gold mining deal, involving a Nevada deal, where every point of agreement was distorted into its opposite meaning, as soon as was written up in form of a contract.

And as I was storming into my associate's office in order to let off steam and my indignation, he calmed me down and said "that's what the American business man is calling sport"!

And, no, I don't feel that's true overall, though haven't we all lost some respect for dealing true in our daily chores? ... and losing respect in the end seems to be in the trend. Wonder, how this all came about? Maybe, we've been putting too much trust into the guys, who should be representing you and me ... frust! ... and as a friend said to me, you got to have a war chest to fight for your rights and it just may become more expensive than all your other social security.

Kind'a scary ... and please forgive my ramblings

Au will be my security - cb2

Hill Billy MitchellCurrency comparison chart#595608/14/01; 10:40:47

At the above link you will find a good chart to print weekly for future comparison purposes.


Hill Billy MitchellA good place to find the truth.#595618/14/01; 10:46:08

Please see link.


site stewardThe end of bullion banking as you know it...#595628/14/01; 10:53:58

The volume of gold cleared in London has fallen to 500 tonnes per day through the month of July; still very brisk by any reckoning, but nevertheless, this represents less than half of the brisk trade occurring four-and-a-half years ago when the LBMA first went public with its clearing statistics.

Factor the Washington Agreement into this decline. For perspective, please recall that the Washington Agreement was a voluntary policy decision by a consortium of major European Central Banks to alter/clarify their role in the realm of gold bullion banking operations. Notable, the decision was that lending operations would be curbed.

Are you starting to get the big picture?

When you do, you will want gold. Centennial can help.


Hill Billy MitchellLease rates#595638/14/01; 10:56:30

One month lease rates are on the rise. See link.


Sierra MadreMexico's monetary policy...#595648/14/01; 11:32:36

FWIW, I have the sense that Mexico's monetary policy is quite conservative (though I have no hard data - I'm not good on statistics) by comparison with the Fed's behavior.

Never thought I'd see the day!

By the way, our agricultural sector is in a shambles and there is great dissatisfaction in this important popular political area.

The Mexican government has not given SECURITY the prime importance due to it. It requires REPRESSION and that is not p.c.

Good things are brewing with silver here. Modest advances, perhaps to increase by year end. Will report later on.


Sierra MadreHBM: your post No. 59551#595658/14/01; 11:42:09

Thanks for sharing your thoughts on the subject of Manipulation! That was a great post, indeed. Much wisdom in it, and I say, Amen! "All Wisdom is from the Lord".


Black BladeIMF Report on US Economy - Very Grim!#595668/14/01; 11:57:51

IMF Concludes 2001 Article IV Consultation with the United States


Directors indicated that the size of the U.S. external current account deficit did not appear sustainable in the longer term and that it raised concerns that the dollar might be at risk for a sharp depreciation, particularly if productivity performance proved disappointing. A sudden correction in the current account deficit was seen as possibly having adverse effects on the United States and the rest of the world economy. Directors stressed that disciplined macroeconomic policies-including continued fiscal surpluses-would help to facilitate an orderly adjustment in the dollar and the current account deficit. At the same time, they observed that further reforms in other major countries, that would enhance prospects for profitable domestic investment, would also help to ensure that the adjustment of global external imbalances takes place in a manner conducive to strong growth in the world economy.

Directors expressed concern about the decline in personal saving and rise in household and corporate debt levels in recent years. They cautioned that if productivity growth turned out to be far weaker than the growth rates experienced since the mid-1990s, the economic slowdown could be prolonged, adversely affecting household and business balance sheets. At the same time, given that the rise in equity wealth in recent years had contributed to the decline in household saving, Directors noted that a further decline in equity prices could depress consumption and raise the personal saving rate in the short term, pushing the economy into a more pronounced decline. Although in these circumstances supportive monetary policy could cushion the negative impact, a sizable adjustment in household and corporate balance sheets would need to take place to reduce debt levels.

Black Blade: Doesn't Wall Street even read these reports? This is truly very ugly. It's "Game Over!" Everyone should read this! Addresses SS and Medicare, negative savings, economic outlook, and even CPI and CPI deflators (though one must read {between the lines"). The economic outlook is at best - Very Grim!

Black BladeU.S. Steel to Shut Some Mills, Cut Jobs#595678/14/01; 12:04:46


PITTSBURGH (Reuters) - No. 1 U.S. steelmaker USX-U.S. Steel Group (NYSE:X) said on Tuesday that it will close the majority of its remaining operations at its Fairless Hills, Pennsylvania, mills due to the impact of steel imports, cutting almost 600 jobs and taking a second-half charge.

Black Blade: Adding to the "Bone Pile." This article should be read in conjunction with the IMF report (A Must Read!).

Black BladeAOL Is Fine, You're Fired Anyway - Tales of the "Bone Pile"#595688/14/01; 12:12:33


Anonymous sources predicted several hundred to 1,000 lost jobs, this month or this week, in unknown AOL divisions. Besides citing nameless insiders, outlets also gave plenty of ink to analysts. (Note that when the media aren't questioning analysts' integrity, we're quoting them.) "Analysts said AOL executives began telling investors earlier this month to expect additional cost-cutting and layoffs in the near future," said the L.A. Times. At least the investors are well informed, unlike nail-biting AOL employees. Reporters' attempts to clear the air were consistently rebuffed by AOL spokespeople. The New York Post's Joe Gallivan, who was shot down by "three separate spokespeople at the well-oiled media machine," might hold the record.

Black Blade: These corpses are to be added to the "Bone Pile" next week according to what I hear. Part of the shake out of the Dot.Com mania.

Centennial Precious Metals, Inc. / USAGOLDHard assets... Easy access!#5956908/14/01; 12:38:40

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OROBlack Blade - hedge funds - kettles calling pots black#5957008/14/01; 12:45:54

It is exactly the IMF and the BIS as well as the poor emerging market governments who did as they suggested who are wholly and completely responsible for the "hedge fund disaster" of 97-98.

The main culprits were currency pegs. The Asian (and other) governments took IMF suggestions for various forms of currency pegs, fixing exchange rates to the dollar. This is like offering free put options for the currency vs. dollar (most hedgies are domiciled in dollar financial centers in the "tax havens" and run from NYC, and London), thus the rates of return on investment within these countries appeared more attractive to the hedgies than they actually were, because of the currency peg subsidizing interest rates for incoming investment. A put such as substituted for by the peg would add 1.5%-2% per year (minimum) in hedge costs for the hedgies on top of borrowing costs. Thus the 7% interest rate spreads relative to dollar rates would turn into 5.5% - 5% spreads or less, and would have reduced the high foreign investment volumes.

When the hedgies blew up during the fiasco, they held emerging market debt and emerging market bank liabilities by the tonne.

Mahatir and the IMF, along with the BIS and the various multi-governmental would-be regulators are complaining that hedgies did their job and took advantage of opportunities the regulators offered for exactly those reasons for which these opportunities were provided: higher investment flows into emerging markets.

The crux of the matter is that the bank cartels behind the governments and the multilateral regulators are trying to get rid of the hedge funds that have competed with banks for client funds and client funding. The bottom line is that the hedgies are much more efficient and quick in allocating capital and have taken bank's best opportunities away from them on both the borrowing end and the lending end. Particularly unsuccessful were Japanese, German, and French banks, that despite sub-market interest rates provided by their central banks, had lost market share in all financial arenas. I can only hope that the hedge funds have enough political clout behind the scenes to prevent the bank cartels from having their way and imposing crippling regulations such as they put on themselves in the interest of preventing competition among them.

The bankers themselves were in the exact same predicament as the hedgies at the time and it was the BIS' raising of capital requirements as these same bankers demanded that acted as the trigger for the unwinding of the emerging market trade. LTCM counted many well connected Italian and other Continental government related organizations among clients. That is why it was allowed 20:1 leverage, just as banks are allowed more than 10:1 leverage because they have central banks (i.e. tax payers) to underwrite them and bail them out. The regulatory bodies are intended solely for the purpose of keeping competition out of banking. Particularly so in German and French banking. Most extreme was Japan.

Truth is rarely promoted by regulatory bodies. They routinely cause problems and are constantly in the process of finding a scapegoat to blame and allies to provide them with further power and less accountability.

Black BladeForbes Body Count - and Howdy ORO!#5957108/14/01; 12:54:46

The "Bone Pile" grows unchecked.

RE: ORO - I hear ya! BTW, welcome back. As many of these hedge funds work with derivitive instruments they are quite leveraged and can move segments of markets with a relatively modest amount of cash. I suspect that we will hear of many more LTCM-type debacles before long. Cheers!

- Black Blade

Black BladeMilitary Body Count - Nearly a Million Added to the "Bone Pile"#5957208/14/01; 13:04:19


On August 3, the Defense Department announced a proposal sent to Congress to initiate another round of military base closings in 2003. Dubbed the Efficient Facilities Initiative, or EFI, it proposes a process similar to the BRAC (Base Realignment and Closure) process that involved four rounds of base closings in1989, 1991, 1993 and 1995.

Black Blade: And when the Recession is likely to be intensifying. Grim!

annie"Manipulation"#5957308/14/01; 13:16:28

HBM, very respectfully, in the words of Sarah Jessica Parker's character: "May I just say…WOW!

Overall, an excellent post and I congratulate you on the ideas and emotions you expressed. I am busily getting ready for my California trip, but I felt compelled to explain myself.

I was a bit surprised when, learning of your post, I went to and was unable to find a definition to defend my posted meaning of "manipulation". I think of words in terms of denotation and connotation, and—without looking the word up—I was quite sure that, although the connotation was negative, that the denotation of the word allowed for a much wider interpretation. I still wonder if an unabridged dictionary—one of those huge hummers that needs its own stand in the library—would allow for a "friendlier" meaning of the word. Without access to that, I cannot argue against your Websters.

I would ask you to consider, however, your dictionary definition: To control or play upon by artful, unfair or insidious means. I *think* that this definition allows that *any one* of the three would satisfy the requirement for "manipulation". So, I would exclude what you refer to when you say: "Put unfair and insidious together and we get arrive at a means to an end." If, as I believe, the definition allows any of the three to satisfy the denotation, I choose the definition: To control or play upon by artful…means". And I would choose "play upon" rather than "control". So I have a definition of manipulation that is as follows: To play upon by artful means.

Artful is defined as: Skillful in accomplishing a purpose, especially by the use of cunning or craft. Although this says "especially by…", I think that that applies to the connotation, not denotation of the word. I think that it is not unreasonably broad to define artful as simply "skillful in accomplishing a purpose".

So, I would arrive at the definition: To skillfully play upon with the idea of accomplishing a purpose.

With regard to my children, they would be the first to tell you that I was *never* "manipulative" in the sense of tricking and/or controlling. I think the part of your post that refers to parent/child relationships is what compelled me to "defend myself".

Other than the strict definition of the word (that I would not have used had I looked it up first), I agree with all of the ideas and emotions you express in your post. I am sorry that I was responsible for such a misunderstanding of what I meant by the word "manipulation", but I think we all benefited from the end result—your excellent and sincere post.

PS: And thanks for calling me Lady annie. That's nice.

NetkingIsraeli troops massing near Bethlehem#5957408/14/01; 13:29:16

Hours after Israel staged a three-and-half hour incursion into Jenin, Israeli media on Tuesday quoted Palestinian sources who said that Israeli troops and tanks were massing near the West Bank city of Bethlehem.

The Israel Defense Forces refused to comment

NetkingConsolidation trend likely to strike gold?#5957508/14/01; 13:42:59


Ownership consolidation is dominating Australia's mining industry, now undergoing its biggest structural change since the 1960s and early 1970s when the foundations were being laid to propel the nation's leading houses onto the world stage . . .

The question is: when will it end?

In the gold sector, JP Morgan analyst Geoff Breen reckons not until there are only two major gold mining companies left in the world - South Africa's AngloGold, rated the world's largest gold producer, and Toronto-based Barrick Gold Corp, now hard on AngloGold's heels as a result of its $US2.3 billion takeover of Homestake Mining Corp.

Both companies have sufficient market capitalisation to attract the support of large international investment funds, but the rest of the sector, including Australia's largest gold miner, Normandy Mining, struggle to remain on the funds' radar screens.

But major consolidation of the Australian gold industry is yet to happen . . . "

-Watch this space, Netking

JCF"The conspiracy of the gold conspiracy"#5957608/14/01; 13:43:22

The life of a "fictional" central banker that one would SWEAR bears an uncanny similarity to Alan Greenspan. Very well done!
Hill Billy Mitchellannie @ # 59573#5957708/14/01; 14:17:03

Lady annie

I'm glad you didn't mind being called lady annie, gladder than you could have known. It occurred to me that our posting handles are sometimes used to disguise certain things such as gender, and that I might have made a great mistake.

In my view you were not a springboard due to a misunderstanding. However, you did misunderstand me. It never occurred to me that you would manipulate your children in a coercive or negative manner. What I meant was that I sensed that you were certainly not such a person and that in the context of the discussion, manipulation was entirely the wrong word to use. I can assure you that I could tell very clearly that manipulating your children in the context of the practice of those who are manipulating POG and other markets, was a very disturbing thought to you.

I freely admit that manipulation can be and sometimes is a fair and non-insidious process. I am an accountant by trade and often talk of putting data in good spreadsheet form so that I can manipulate the data. In the accounting world, if we were to mean something other than a fair treatment of data, we would use the phrase, "massage the data", rather than, "manipulate the data".

If you were to go back to the posts by you and Sir ski, I think you would find the context, which prompted my post. The term manipulate in your posts was, in your context, a term which was very distasteful in your mouths. It was in that context and that context only that I responded. I was agreeing with you while trying to point out that some things such as encouraging your children in the way that they should go would not fit that particular context of manipulation.

All advertising and salesmanship is not manipulation in the context of your conversation. All parental guidance is not manipulation in the context of your conversation. Some people do manipulate prospective buyers in that context when trying to make a sale and some people manipulate their children in that context when they point them in certain directions.

Can you see my point. You were agreeing with ski in a generalization that all manipulation is bad and yet you knew that what you did with your children was not the same thing at all. A real important point I was trying to make was that, by lumping the actions of the "despicable POG manipulators", with a completely different type of action such as making an honest sale or directing our children, would have a tendency to water down the great evil perpetrated upon the public by these, shall I say it once again, "despicable people".

I will stand by my statement with the context qualification. Manipulation in the context of gaining an unfair advantage is hideous. It is always evil and never good, precisely why you called the concept into question when you used the example of your children.

Your posts are quite stimulating and have helped to liven up a rather dreary place. This site can and should be a place for the lively exchange of ideas and not so somber as it has been until as of late.

Very respectfully,


Old Yeller Surprise,a mainstream media gold story#5957808/14/01; 14:25:59

That is actually written in a fairly bullish light.Yes,the US economy has some profound imbalances that cannot continue indefinitely.Of course,the old no-inflation card is played yet again,as if trillions of overseas dollars will dutifully stay at their off-shore homes,never to be seen or heard from again.

Also,there is absolutely no mention of the background work so skillfully researched and presented by James Turk,Reg Howe and GATA,among many others.However,it is quite interesting the one gold stock the writer holds is Gold Fields;which,as we all know,is a non-hedger and proud of it.

Thanks to Cyrano de BearAttack for the link.

BeowulfUSAGold#595798/14/01; 14:47:49

Just to let you know my order showed up today. THANKS!

For those who didn't take advantage of the Russian coin offer back in June you missed out. They are some great looking coins. I only wish I could read Russian so I could know what the inscription on the coins says.


annie(No Subject)#595808/14/01; 15:24:37


Just popped in to see if you had responded to my message. Your post honors me. Thank you.

I think that the gold manipulation has become for many of us symbolic of the manipulation that is going on all around us--the insiduous, evil kind. The Powerful--the super rich, the PTB, the banking cartel, the gold cartel--whoever "they" are, don't care for a moment about right and wrong. Their only objective is the maintain and enhance their power, i.e., vast wealth.

I recognized the expression of the feelings of frustration and disgust in your post. It hit close to home.

I look forward to mutual posts upon my return. And I always welcome emails.

"Lady" annie (just this once!)

Cavan ManConsonace in Sound Reasoning#5958108/14/01; 15:47:35

From: The New York Observer, 8-13-01 edition

Will Upstart Euro End the Reign of Almighty Dollar?

By: Michael M. Thomas


"....what conjunction of forces, heavenly and otherwise, has allowed our circulating paper to rise and rise and rise in the face of practices that would have condemned--and historically condemned--any other realm's coin to currency perdition"

"In a globalized economy that is conjugated in trillions and large fractions thereof, there is at present, among all the stores of value known to man, no acceptable alternative to the dollar" "The the world's invoicing currency."

"It started back in the 70's with petrodollar recycling. This was money created by Citibank et al in overseas offices beyond the regulatory reach of the FED that was, for all practical purposes, fully convertible."

"The dollar let us buy whatever we wanted whenever we pleased, including a considerable share of overseas productive capacity."

"Nothing that wholly distorts equilibrium is a good thing if it continues indefinitely, since disequilibrium produces chaos." "These days, we walk loudly and proudly, and instead of a big stick we brandish a fat bankroll--and we rule the earth, and large sections of the earth hate us for it."

"As for an alternative, a challenger if you will, I think there is one lurking behind the arras. An alternative whose consequences for the dollar and for this economy as it is presently structured, could be grave."

Read on.......

Cavan ManWilliam Manchester (off topic)#5958208/14/01; 15:52:29

In reading the NYT today I note with sadness this fine historian's inability to finish his part III of his Churchill biography due to incapacitating illness.
Cavan Man@CB (too) 59559#5958308/14/01; 16:00:10

Regarding American "sport"

"Let the game come to you."

Anonymous NFL football player

(Only anonymous because of my "over 40" memory)

BR549Widgenomics#5958408/14/01; 16:16:37

Modern capitalism

Buyer = "B"
Shop owner="S"

B-Is this the Widget shop?

S-Sure, come on in. What can I do for you?

B-Well, I would like to buy one of your golden widgets. Do you have any in inventory?

S-Certainly, sir. In fact we have 261 of them on our books but 87% of them have already been sold.

B-OK, I'll take that pure golden one that I see on the top shelf on the left.

S-It's not quite that easy sir. You see we're not allowed to sell our precious inventory of golden Widgets because we are audited once every 20 years or so. If you'll indulge me a minute, I'll tell you how you can get a golden widget of you very own. You see what we did was that we took all of our inventory of golden widgets and issued gold widget certificates that represented each one of our widgets. We then gave these gold widget certificates to the IMF store across the street. The store across the street then issued some golden widget SDR's, which they then transferred to the ESF store at the end of the block. You with me so far?

B-I think so.

S-Good, then this ESF store then issued what they call SDR certificates back to us where our books would balance and we wouldn't get in trouble with the GATA police. We are not allowed to sell golden widgets directly you see, but there is no problem with us selling SDR certificates. Get it?

B-Sorta, well not axactly.

S-You see this IMF store was managed by my brother-in-law and his cronies and was very poorly managed. So we promised them that we would not let them fail. They wanted some of our inventory to get out of a jam they got themselves into. But since we are honest scrupulous store owners, we told then that we could not sell our inventory to them, but we could sell them or give them some of our SDR certificates, which represented our golden widgets that he have in inventory. Of course, we can't account for many of the original SDR certificates. They're missing. Must be somewhere in that pile of paper in the attic.

B-Why didn't you just sell the IMF store some of your SDR's?

S-Because that would be illegal and besides the ESF store owns them now, remember?

B-Oh yeah, I forgot. Ok, so how many golden widgets do you have in stock?

S-Well, we're not sure exactly because we keep them locked in the basement for everyone's good and we have some other widgets that we may not own mixed in there with them, but we think we still have around the original amount of 261 of them scattered around down there and we also have some in our deep storage basement.

B-So, how do I buy one of your golden widgets?

S-That's easy sir. If you own some widgets, then you can swap some of your old widgets, we'll keep them for you and then you can buy (or we'll give you) ownership of some of our inventory.

B-Ok, I picked up an SDR certificate that I got from the store down the street. Here it is.

S-Thank you sir. You have a nice day. Don't let our store's front door hit you in the posterior on the way out.

B-Wait I minute. Can I have my golden widget now?

S-No sir, not now. We're going to keep your widgets here, where they are nice and safe. You can pick them up later, if we're still in business, that is.

B-Did you say Nyuk, Nyuk, Nyuk?

tommyRussia projects Middle East war#5958508/14/01; 16:45:22

Monday, August 13, 2001

"...MOSCOW — Russian defense officials and strategists project that an Arab-Israeli war could erupt in the Middle East over the next three to six months.

The widely-held scenario described a war that would engulf Iraq, Jordan, Lebanon and Syria, according to Middle East Newsline. The officials and strategists said Egypt could be swept into such a conflict.

'We are moving inexorably toward a war,' a senior Russian diplomat said. 'Russia has tried and the United States has tried to stop this, but to no avail.'

Russian strategist Yevgeney Stanovsky agreed. Stanovsky, head of the Moscow-based Middle East Institute said a regional war is inevitable in wake of the failure of international efforts to implement a ceasefire.

The trigger for the war could take place in September. The Russian analysts expect an Israeli offensive against the Palestinian Authority triggered by Palestinian bombings of Israeli cities. Such an offensive, they said, could prompt Egypt to direct its Third Army to enter the Sinai...."

NetkingGold rush: India's Q2 gold demand up 7%#5958608/14/01; 16:53:10

"The country's gold demand during the second quarter of the current year at 235.8 tonne showed a seven per cent rise over the same period during the previous year.

The total demand for the first half of 2001 was 490.4 tonne, showing a rise of 17 per cent over last year's first half figure of 417.8 tonne, a World Gold Council statement said" - Netking.

NetkingU.S. plans sustained strikes in Iraq#5958708/14/01; 17:03:34


"The drawn-out campaign was devised after the White House rejected Pentagon plans for a more aggressive air strike that would take out most of President Saddam Hussein's integrated air defenses in one fell swoop, NBC's Jim Miklaszewski reported.

The White House was concerned that a major attack would incite Arab anger and aggravate the current Mideast tensions. "Hitting targets one by one doesn't draw the same kind of attention or reaction," said one official, who spoke on condition of anonymity . . . "
- Netking

CoBra(too)Let the game come to you ... CM - I had to ... accept ...#5958808/14/01; 17:24:29

this game far too long ... though, I didn't ask for this sort of game to be played (nor the song)- and dam'n the ball is not round, but ellyptic, kind'a cryptic, shaped and for all to see - the ball is what I call out of symmetry.
The football, becoming a sign of the time when a-symmetry
becomes a symbol of in-equilibrity.
... Even ... the National Sport seems to contort a level playing field.

Sorry, CM, don't take it personally ... Though, just (th-)sink about your $ and do not beat about your mulberries ... i-am'bushed - not you - cb2

Buena FeECB #5958908/14/01; 17:37:48

France holds firm to ECB succession
By Robert Graham in Paris
Published: August 14 2001 19:19GMT | Last Updated: August 14 2001 19:29GMT
.............Thus French leaders prefer to believe time is still on their side, albeit not for long. They are comforted by a Brussels and Washington consensus that Mr Trichet is the best banker to run the ECB when the euro goes "live" next year...........
Is this a typo or why do they care what Washington thinks?

miner49erBeowulf - #59579, What does my coin say?#5959008/14/01; 18:28:19

I hope this post takes the Cyrillic characters, but simply your coin has on the obverse the denomination. I believe the 10 Chernovetz is what was offered, .2489 oz.(?). I believe there is a one and five as well... anyway:

"äè' / ïÿòü / äå--ÿòü ÷åðâ"'åö

1 / 5 / 10 Chernovetz

And the reverse:

ïð"ëåòàðèè â--åõ --òðà', --"åäè'æéòå--û


"Laborers throughout the land, unite." (Or as we more commonly coin the phrase: "Workers of the world, unite!")

My Russian is survivalist at best, but since you asked...

Best regards,

miner49erBeowulf - Cyrillic#5959108/14/01; 18:29:15

Looks like it didn't like the Russian alphabet...

Oh well...:-)

miner49erBeowulf - and, of course, it should be Chervonetz!!!#5959208/14/01; 18:31:01

i need to go home, now...
auspecBottom#5959308/14/01; 18:35:26

I see a nice shiny and round bottom, and it looks............... SILVERY!
NetkingAusepc#5959408/14/01; 18:48:56

McAgSpec, We are each smiling from our respective parts of the world yes. What's your "guess" on POS @ Dec 31st? - regards Murray
escapethematrixBrown orders start on euro criteria#5959508/14/01; 19:38:43


GORDON BROWN has ordered the Treasury to begin assessing his five economic tests for joining the euro, in an operation involving hundreds of civil servants across Whitehall.The existence of the operation to prepare what are described as "voluminous documents", examining all the relevant issues on scrapping the pound, was admitted by the Treasury last night

January 1, 2002 starting to loom large...Now if we could just get OUR Treasury to start admitting stuff :)

RS@ HillBilly Mitchell re: msg#: 59551#5959608/14/01; 19:40:40

Indeed sir, please allow me to humbly agree…
Thank you for your (persistent) eloquence.

NetkingDollar tumbles after IMF warning#595978/14/01; 20:03:02,,5-2001282724,00.html

". . . The dollar dropped to its lowest level in almost four months against the euro, and also lost ground against the yen and the pound, after the IMF said that America's ballooning current account deficit had put the currency at serious risk.

The influential institution argued that the US economic outlook was highly uncertain, unnerving a market that was already pessimistic about the prospects for an American bounceback.

The IMF urged the Federal Reserve to stand ready to cut interest rates again, and highlighted America's record-breaking current account deficit as a key risk in the months ahead. "Directors (of the IMF) indicated that the size of the US external current account deficit did not appear sustainable in the longer term," the institution's annual assessment read. "It (the deficit) raised concerns that the dollar might be at risk for a sharp depreciation, particularly if productivity performance remained disappointing . . ."

auspecMurray#595988/14/01; 20:19:32

My guess on POS year end is much worse than a barbarous relic, a Clinton promise, a Newt nicety, or a Robert Rubin code of ethics. It will surely NOT be $2 or .50c, Har, Har. This 'nodding head' says $4.95 for openers, jokers wild. Clif Droke would make a prediction of $9.95 POS along with simultaneous comets hitting opposing polar ice caps. I am not yet that foolish, or need to strike my head a few more times.
What do you say, netKing?
McAgspec {leveraged, amplified, multiplied, and tie-dyed}

CanuckAfterhours trading#595998/14/01; 20:46:18

Does anyone (Stranger?) have a link to afterhours trading for Newmont?


Canuck@ HBM#596008/14/01; 20:55:14

Great post (59551).

What was the best?

R PowellNetking/ IMF urging Fed. to stand ready to cut rates#596018/14/01; 20:57:53

I had thought the last cut from the Fed was going to be another half point and would doom the dollar. It was only one quarter. I don't know if the dollar can withstand many more cuts. Lower rates to save the equities but this medicine may be poison for the dollar. Just a gut feeling but another half point cut may send both the stock market and the dollar downward.
POS prediction, I don't really think the POS can get a whole lot higher than $20.00 by year's end but who knows?
The Silver Survey lists dishoarding from China during 2000 as the price depressant for that year.

uponroofIMF provides the hatchet......saving Bush Adm from the dirty work#596028/14/01; 21:21:50


What are the chances that the IMF is providing convenient cover for the FED and Mr. O'Neill. We all know how very pronounced they are (especially O'Neill) on maintaining their beloved strong dollar policy.....

I say horse****, this IMF warning is a wink and a nod between manipulating buddies who don't want the markets to know the real intentions of the USA monetary braintrust.

IMF is doing the FED/Bush dirtywork in knocking down the buck. It was prearranged between them. All that's left is the (obligatory) phoney critisism from the white house and FED to cover all tracks.


Black BladeDollar Slips to Fresh Lows Abroad#5960308/14/01; 22:43:14


TOKYO (Reuters) - The dollar came under pressure on Wednesday in Tokyo, hitting fresh multi-month lows against European currencies in the aftermath of a warning from the International Monetary Fund (IMF) on a possible dollar decline. The dollar also hovered near two-month lows against the yen a day after the Bank of Japan eased its already ultra-loose monetary policy. In its latest annual assessment of the world's largest economy, the IMF said its outlook was uncertain, and warned that the unsustainability of the yawning current account deficit raised the risk of a sharp depreciation in the U.S. currency particularly if productivity proved disappointing.

Black Blade: The sharks smell blood! Now that the IMF has officially exposed the wounded dollar, the circling sharks are nearing a feeding frenzy. We could be in for "Interesting Times."

megatronRPowell/Netking#5960408/14/01; 22:52:07

Either of you familiar with Minera Andes? They showed some fantastic silver drill cores today from Argentina. Of course, no one cared. Some sections were in the 40 ounces/ton range.
justamereBearNetking BlackBlade#5960508/14/01; 22:58:17

Looking at the USD Index, Which seems to be leveling off, possibly to rise a bit, that Aug 20 date someone was mentioning is beginning to look more plausable


NetkingRich / Auspec etc - Ag#5960608/14/01; 23:12:53

Don McAlvany makes some good comments such as: ". . .During Lyndon Johnson's presidency, silver was removed from most U.S. coinage as the federal government began to develop far more inflationary policies (i.e., the days of "guns and butter"). By the early 1970s, silver (which the government said had been "demonetized"), began to rise in price along with gold, platinum, oil, inflation, and U.S. interest rates - ultimately rising 2500% by 1980 (i.e., from about $2 to $52/ounce). . ."

Netking > I see no reason why the POS should not repeat a similar rise (eg 2500%) over a similar time frame of say 6-9 years from a base of say $4.10 spot. This would also roughly equate to 1980's high in todays 2001 $'s yes?

Consider this, Don says: ". . . The Hunts did take very large positions in silver (i.e., at least one hundred million ounces) because the price was cheap and the inflation-induced upside potential was huge. They bought most of their silver under $10 per ounce and all of it under $15. . ."(1980's $'s).

Don goes on to say: ". . . In the late '70s speculators jumped into the silver market and gave the metal its final run to $52. The ultimate collapse of silver from this overpriced pinnacle was blamed on the Hunt brothers by Washington and Wall Street. But that was as dishonest as the non-stop economic/financial lies that come out of Washington and Wall Street today, and the manipulation by financial officials was as blatant then as it is today in financial markets.

The Comex and the CFTC (Commodities Futures Trading Commission) changed the silver trading rules (i.e., they raised the margin requirements to 100%; they refused to let the Hunts take delivery of their silver; and they allowed only futures sell orders, not buy orders). Of course the market could do nothing but collapse. But first (before changing the rules) a number of the board members of the Comex and the CFTC shorted massive quantities of silver. They made billions in the greatest financial manipulation in history - up until that time and blamed the Hunt brothers for the collapse of silver. [ED. NOTE: Today's stock and financial market manipulations are even larger and more blatant. . . " sourced from

Netking > I see no reason why "something" such as the above would not happen again, HOWEVER as Sir Another has said by implication with Gold, once the POG(and POS) starts to "cook on nitro" there will be a dislocation of the paper & physical markets, . . . eventually. Remember in the late 1970's & 1980 there was much more physical silver around, this is 2001 & Rich will tell us that there is much smaller known inventory around today. Ergo, the next peak because of the preceeding, may therefore be higher(much). Factors such as POS:POG ratio would have to be tied in too. Will the POS return back to it's traditiional ratio of 1:16? Would it for a time go to the ratio of which it is found in the ground with gold 1:10? . . . who knows, not me(yet).

For December 31, given scenarios such as the USD heading towards "R.I.P. zone" the M/East bubbling away and even without the backs of the short sellers being broken I still feel $7.25-$12.75+ a conservative possibility. When the POS moves we'll see(IMVHO) a move and a retracement, a move and a retracement, a move and a retracement etc as it goes up for the next 6-10 years before peaking? My paper holding expires Nov '02, so wisdom will be needed when to offload.
- regards Murray

NetkingJ'Bear / Megatron#5960708/14/01; 23:27:04

J'Bear(59605) What "the boys" have gotta guard against is a flight of USD denominated investments from entering the USA and instead going(flighting) elsewhere. That's what's propping things a little at the moment, all the o/seas money still flowing in. If that stopped abruptly I things would implode.(IMO)
megatron (08/14/01; 22:52:07MT - msg#: 59604)
RPowell/Netking Either of you familiar with Minera Andes? They showed some fantastic silver drill cores today from Argentina. Of course, no one cared. Some sections were in the 40 ounces/ton range.

Netking > Interesting Megatron, got any links for this with more info eg when's it likely to come on stream? What's your analysis saying about the market?

- regards Murray

megatronSilver gab#5960808/14/01; 23:38:22

These juniors have no love, although it seems the tightly held ones 'held' thier value. Yamana is shipping extremely high grade ore to Canada for processing. They are at about 25 cents! I personally believe in the immense power of the greed of political scumbags. Weeks before silver, or gold for that matter, is going to move, LOTS of these companies like Yamana, Minerea Andes, etc are going to pick up HUGE Bids. The info HAS TO BE LEAKED, so they(AG and pals) can profit. The volumes will go nuts, it's age old human nature. Look at the TSE PM index. That ain't farmers buying those $10 share gold and silver giants. One day the junior chart(riskier) will really pick up on insider info and then look out. Until then, silver $4.20.
Black BladeIsraeli Forces Encircle Palestinian Villages#5960908/14/01; 23:44:59,2933,32099,00.html

Israelis launch West Bank incursion


Israeli tanks and troops began moving around Bethlehem and villages nearby after nightfall Tuesday, apparently planning for another incursion, Palestinian witnesses said.

Black Blade: Here we go again.

Gandalf the WhiteLook OUT !! SPOT and SPIKE are getting VERY RESTLESS !#5961008/15/01; 00:41:21

The size of the Futures trades tonight on Gold are acting Strange(r)! LARGE size on the BUY side !!
(OOPS a CB2 slip) <;-)

Old YellerEd Bugos takes on Wanniski targeting the gold price#5961108/15/01; 00:47:07

Looks like a pretty good refutation of Wanniski's rather ironclad view of what ails the US economy and his criticism of the Fed's monetary policy.Thanks to Earl for the link.

CB2;I see ol'"Boxcar" Droke wrote a rather complimentary piece on Coral Gold.Don't know if that's good or bad for the company,judging from his rather unusual tangents of late.

Gandalf the WhiteDon't believe that Down Spike on the KITCO Spot Chart !#5961208/15/01; 00:51:42

Kitco is NOT TRUE !! Spot now at $276,50

NetkingDollar cont. #5961308/15/01; 01:34:59

From the BBC - "The strong US dollar is in danger of falling sharply against other major currencies, according to the International Monetary Fund's annual snapshot of the world's largest economy. . . "
Hill Billy MitchellNikkei 225 @ 11,755#5961408/15/01; 02:05:40^n225&d=c&k=c4

Don't look now but Japan is now below Dow all time high(frown) What if all those dollars were exchanged for yen to purchase Japan? If not then gold. They have no storage facilities for oil in these quantities.


Hill Billy MitchellJAPAN#5961508/15/01; 02:07:45

Wouldn't switch to Euros would they?


Hill Billy MitchellCurrency intervention next#5961608/15/01; 02:16:59^n225&d=c&k=c4


Your hint of another rate cut has frieghtened dollar buyers. How many dollars do you think bought with our gold. How much more gold are you willing to part with. Oh, I forgot you are not involved in gold.

Very disrespectfully,


Hill Billy MitchellIncoherent and going to bed#5961708/15/01; 02:27:51

Meant to Ask: How many dollars do you think can be bought with our gold.

Not in the business of buying dollars, you say. Not in the business of selling of gold, you say.

Just a little god who can only create and destroy, you say.


ps: Belgium, where are you?

YukonHistory of Counterfeiting...#5961808/15/01; 02:31:02

To all who plan to watch the "Gold" series on The History Channell Aug. 21-24: you may be interested in the documentary "Making a Buck" to also appear on the History Channell on August 20 at 9PM. The two hour feature provides a cumulative history of counterfeiting from 600 B.C. to the present.

The show's writer and producer, Dan Golden (yes, that is really his name), said it tells eight main stories. Their pupose is to "give a variety of stories throughout time to give the history of counterfeiting."

Perhaps this show will reveal another all important reason to change some of your Federal Reserve Notes into true wealth that is free from "money creation", both sanctioned and otherwise.

Viva Liberty!

Yukon C.

justamereBearNetking 59607#5961908/15/01; 03:03:50

Well its a few hours later, and the USD index has resumed DOWN. Hot money does not take long to get afraid and leave. Speed of light these days. I am on record as supporting your position. The US has been supporting its current account deficit with hot money. I kept wondering why the lenders/ investors did not look at history. Every country who has ever had a current account deficit for even a short period, has gotten into Korea, Thailand, etc type problems. I have been holding my breath about this since Feb. 1987. I'm about to turn blue.

May god bless us, each and every one. It's going to be grim.

NetkingFOREX - J'bear etc#596208/15/01; 03:47:11

J'bear, check out this list of live currencies against the USD, there's some movement for sure.
Glad our house is built on the rock! - regards Murray

Black BladeNEW FLURRY OF PINK #5962108/15/01; 06:44:08


Already thousands of heads on Wall Street have started to roll. Industry experts say as many as 30,000 jobs have been cut since the beginning of the year.

Black Blade: Tales from the "Bone Pile." More to come as the Recession deepens.

Black BladeDollar's dullness puts glow on gold#5962208/15/01; 06:47:53


NEW YORK -- A slide in the U.S. dollar against the euro Thursday drove gold futures up 2 percent, breaking the market out of its recent trading range, and bullion has modestly built on those gains. Gold's fate continues to be determined to a large extent by movements in the dollar against the euro, and that is likely to continue in the near term.

Black Blade: Why do they think we call Gold insurance?

CoBra(too) Hello Old Yeller - #5962308/15/01; 06:57:32

Thanks for mentioning the aricle on Coral - might have missed it. PDG started drilling the secluded claim block a few weeks ago. CLH holds a 39% direct interest to production.
Also PDG is rumored to have hit a Carlin type hole only a few ft. from Coral's 100% owned core property boundary to the Pipeline property.
Thanks again - good and informed article and yes ole Louie is quite a guy - bye cb2

Black BladeDays of Reckoning#5962408/15/01; 06:58:49,1902,28632,00.html


In the wake of the tech wipeout, the bankers who profited most are facing the fury of investors, politicians and regulators. Now that the magnitude of the great tech stock massacre of 2000-2001 has become clear - trillions in lost wealth, hundreds of thousands of lost jobs, countless dreams destroyed or deferred - the inevitable blame game has begun in earnest. And who better to hold responsible than investment banks?

Over the past several months, a veritable legion of legal and regulatory forces have lined up in a concerted attack on the once-staid world of technology investment banking. There are the trial lawyers: In the past six months, some 400 lawsuits and complaints have been filed alleging fraud, negligence, market manipulation and other conspiracies. In the wake of Merrill Lynch's recent $400,000 settlement of a case by an investor who claims he was misled by celebrity Internet analyst Henry Blodget, hundreds more complaints are expected.

Black Blade: The Pied Pipers are more apt to find themselves in court than on CNBC these days. The economy goes south and the lawyers (sharks) smell blood. For the last couple of years we have discussed this possibility and I said that this day was coming. "Interesting Times."

Black BladeAfter the Long Fall, Tech Stocks Still Look Expensive #5962508/15/01; 07:06:21


NEW YORK Eighteen months into the worst bear market for technology stocks ever, many Wall Street strategists are warning investors not to expect the sector to turn around soon. The problem, they say, is that profits at first-tier technology companies such as Cisco Systems Inc. and EMC Corp. have fallen as fast as - or even faster than - the companies' stocks. As a result, many big technology stocks are now even more expensive, in terms of their price/earnings ratios, than they were last year.

Black Blade: I made this case before. Gee it's fun being right - just a shame so many people are made to suffer. This article should be read in conjunction with the previous one posted. Gold could very well break loose soon should this news hit the wires over and over.

Black BladeThe gathering gloom#5962608/15/01; 07:13:19


There have been further signs of economic slowdown this week. The Bank of Japan has reacted by easing monetary policy, in a desperate bid to stave off recession. The German economy is also now in serious trouble, while the prospects for America look uncertain at best

Black Blade: Funny - {stave off recession" - I thought that Japan has been in recession for more than a decade now. "The Economist" never seems to get it right. Maybe they're just gullible. Anyway, the Global economy is in a deepening recession. That light at the end of the tunnel is an oncoming train. Time to add a bit of gold insurance.

Black BladeForget the Fed, save yourself#5962708/15/01; 07:21:24


Confidence in Alan Greenspan has led consumers and businesses to rack up unsustainable levels of debt. But he can't hold off a major downturn forever. There's a good chance that, regardless of what Alan Greenspan does, a major downturn in the economy will come. Investor confidence in Mr. Greenspan rests on a string of Federal Reserve successes. Rate cuts brought us safe landings after the 1987 crash, and again during the Asian crisis in 1998. But it's Mr. Greenspan's very success that is to blame for today's difficulties. Believing in the omnipotence of the Fed, consumers and businesses have imprudently racked up unsustainable levels of debt.

Students of economic history will know we've been here before -- namely Japan in the past decade and the United States in the 1930s. In Japan, stock prices are down 65% from their 1989 peak, even though interest rates have been cut to nearly zero. In the Dirty Thirties, interest rates fell from 6% to 1.5%, but it was not enough to prevent stocks from delivering their worst performance in history. Both crises had this in common: They happened in the aftermath of heavy speculative bingeing, massive buildup of public and private debt and steep declines in personal savings

Black Blade: "Those who don't remember the past are condemned to repeat it." Gold and silver as insurance should be seriously considered.

Tommy PCBS#5962808/15/01; 08:45:33

More main stream news!!
escapethematrixO'Neill on CNBC at 2pm EST.......#5962908/15/01; 09:07:57

Treasury Statement on Dollar Policy, O'Neill on TV: Comment

Washington, Aug. 15 (Bloomberg) -- Comment from Treasury Department spokesman Rob Nichols on speculation that U.S. policy makers are preparing to back off their strong-dollar policy, and that U.S. Treasury Secretary Paul O'Neill would comment on the dollar in an appearance on financial news network CNBC at about 2 p.m. New York time.
``The Treasury secretary is expected to talk about the economy and also the rebates and the stimulative effect they've had on the economy. He's not expected to talk about dollar policy. There's been zero change in dollar policy,'' Nichols said

uponroofPOG getting an AM bombing.#5963008/15/01; 09:09:56

The dollar swoons and so does gold......

Well now, lets see...

The dollar is supposed to swoon as the powers that be have decided it's time has finally come. So it is understood, and so it shall be. Gold is supposed to rise in direct correlation to the swooning dollar. So it is understood, so it shall NOT be?

If anyone still thinks the dollars for gold market is not closely 'managed', to the benefit of a select few please explain this AM's POG action. On the heels of an IMF dollar hit job one might think gold would perhaps be a little more in demand. At the very least this 'unusual' behavior condemns those selling gold this morning for their suspicious actions. I believe POG action is on the hands of those also responsible for the calculated lowering of the dollar.

This is called having it both ways my friends and it stinks. Gold market intervention is blatant. It also brings to question the basic validity of the so called inverse relationship....which is just what they want.

Can't wait to hear the explanation for this blatant AM bombing of POG.

I am hoping at the London close (noon) we get the usual bounce. Perhaps this AM bombing was even in anticipation of the bounce. We'll see.

Buena Fetremors#5963108/15/01; 09:19:06

Watch the 30yr bond, CRB for major reversals. Ripple effects ........ things out of balance ....... PPT starting to sweat.
Tree in the ForestDXY0#596328/15/01; 09:24:54

Dollar has broken below support at 114. Now around 113.6. 114 was supposed to be an important threshold.
USAGOLDToday's Commentary. . . .More at Commentary & Review page for Current and Prospective Clientele#596338/15/01; 09:32:32

In Brief: Gold is tracking sideways today after a
fairly firm beginning to the week. The yellow is
reacting primarily to a weaker dollar versus the euro
and anticipation of further weakness.

Reuters reports that "The dollar slid over one percent to
fresh multi-month lows against the euro, Swiss franc
and yen on Wednesday as a warning on the dollar's
vulnerability from the International Monetary Fund
intensified its downward momentum. Bearish dollar
sentiment has been building for days and dealers said
the dollar's break of key chart levels at 121 yen and
$0.91 per euro accelerated its fall." We continue to see
comparisons surface both in the the mainstream press
and financial newsletter circuit between the current
financial atmosphere and the 1970s. In reading Doom,
Boom and Gloom's Marc Faber, we are reminded that
during the 1970s the dollar declined on the order of
70% against the other major currencies -- just to give
you a thumbnail indicator of what's possible during a
devaluation (de jure, de facto, or otherwise).

As the stock bear market digs its claws ever deeper into
investor portfolios, we are beginning to see those same
investors take out their wrath on a host of investment
banks they accuse of bilking them out of billions
dollars through phony stock offerings of companies
that never intended to build a market or turn a profit.
How many stories have we read in the past few weeks
about stocks . . . . . . (MORE)

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Tree in the ForestAmerican real estate#596348/15/01; 09:41:21


Mansions priced at $500,000 or more may take 3 years to sell
By John Rebchook, News Real Estate Editor

The Denver area is saturated with thousands of expensive homes on the market, creating a glut of $500,000 to $5 million properties not seen in a decade.
There's a 27-month supply of unsold homes starting at a half-million dollars or more, said Jack O'Connor, co-founder of the Prestige Real Estate Group. O'Connor did a recent sales analysis of upscale homes. There are 2,822 unsold homes priced from $500,000 to $5 million, compared with 1,971 a year ago, a 43 percent increase. In some upscale neighborhoods such as Castle Pines Village about 20 percent of the homes are on the market, said O'Connor, who has been involved in the residential real estate business in Colorado since 1979. A year ago, there was a little more than a seven-month supply of homes on the market in the upper-price range, he said. Now it will take almost three years to sell the homes, based on this formula. "That's pretty dramatic," O'Connor said. "It even surprised me." And it likely is understating the supply, he said. "I used a really conservative method that I think absolutely can be supported," O'Connor said. "After going over these numbers (using historical weighted and annualized projections for the rest of the year), I'm convinced that there really is a three-year supply of homes priced from $500,000 to $5 million."

Trail Guide has predicted a rise in the price of all assets with inflation. Are you sure TG? Inflation coupled with depression can be a funny thing. Prices want to rise but can't always. Depends on how elastic the demand is. Now if foreign money bids for these homes because they become bargains in Euros, that's something else again. But I can't imagine Europeans wanting American tract homes or Chevrolets.

Thanks for the link can-can.

Sierra Madre"History" Channel..."Gold!" upcoming series Aug. 21#596358/15/01; 09:48:21

The series "Gold!" starts Aug 21, I believe.

OK, I'd like to go on record as having warned all the ladies and gentlemen on this Forum, "Do not expect any favorable treatment for gold as a monetary metal with any present day or future usefulness, on any "History" Channel program".

I think this series is meant to bash gold.

The video will be stunning, but the audio...better push the "mute" button; you'll only be hearing the Establishment line, which we all know by heart.

These programs will be full of praise for gold, but as a stupid thing that people used to hunger after in "the old days". It's no longer "cool" to lust for gold. Gold is today useful only for decorating ladies and other women who are not ladies. Gold: a pretty metal but tinsel is just as good.

The praise for gold, will be a damning praise.

The "History" Channel is one more tool for manipulating people by re-writing "History".

Enjoy the great video. Push the "mute" button.

Suspicious Sierra

Tree in the ForestThe Economy: Going in the Tank Thanks to Comrade Fedgov#596368/15/01; 10:14:53

The creepiest cabal of commies on this planet is the US government. Thanks to Buster_Brown for the link.
Hill Billy Mitchelluponroof @ # 59630#596378/15/01; 10:37:13

Sir uponroof

You say, "...Gold is supposed to rise in direct correlation to the swooning dollar. So it is understood, so it shall NOT be?"



It will happen, so shall it BE. It will happen when TPTB go long on gold and short on $. That could happen in a year or so. It could happen any day now.


Your hope, "I am hoping at the London close (noon) we get the usual bounce. Perhaps this AM bombing was even in anticipation of the bounce. We'll see."



I do believe you will get your wish, assuming your wish is just a small bounce (less than $10.00) If you are hoping for more, be careful what you hope for. Are you through accumulating?

Very respectfully,


Sierra MadreMexico's gold reserves...#596388/15/01; 11:09:53

Mexico's gold reserves (including "gold loans" which we know will never be recovered, and whose amount is not specified) amount to a measly 220,000 ounces.

Total foreign exchange reserves and gold are about $36 billion US; but the central bank does not dare to buy a significant amount of gold - it might upset the US Establishment. And we cannot afford that. The fact is no central bank anywhere dares to "bell the cat".


site stewardChanges to Eurosystem international reserves -- week ended August 10th#596398/15/01; 11:25:54

Within the ECB and 12 member central banks the value held as gold and gold receivables declined EUR 29 million. At the same time, however, the value held as foreign currency declined over 20 times that amount, down EUR 600 million.

Gold reserves dropped by EUR 29 million within the Eurosystem due to combined effects.

The Bundesbank's issue of one million 1 Deutschemark commemorative gold coins involved the allocation of approximately 2.3 tonnes attributed to this week's book. (Nearly 1.5 tonnes allocated to this project were represented on the previous week's books while 8.5 tonnes were represented on the book one week earlier yet). In addition to this, there was a half-tonne sale by another central bank (likely the Dutch, who have yet to reallocate nearly 195 tonnes prior to Sept 2004). Taken together, these operations leave the consolidated Eurosystem with EUR 128.352 billion (12,543 tonnes) in gold.

By contrast to this small operation, there was a EUR 600 million reduction of the Eurosystem's foreign currency during the past week (as mentioned above), leaving the net position in foreign paper valued at EUR 273.1 billion.

With the majority of this being dollar-denominated foreign paper, this exit move seems quite warranted by the dismal performance of the "strong dollar" and its continuing poor outlook. Having climbed to 0.91, the euro has now reached a five-month high, whereas the dollar, having reached a 15-year peak on a trade-weighted basis in July, is now off by more than 6.5 percent.

The next mark-to-market revaluation of these eurosystem gold and foreign currency assets will occur September 28th.


site stewardFed funds slightly tight above target, Federal Reserve adds#596408/15/01; 11:37:05

America's central bank injected permanent funds into the reserves of the nation's banking system through the outright purchase of U.S. Goverment debt securites -- to the tune of $1.384 billion.

The Fed polished this up a bit with additional reserves added on a temporary basis, $4.845 billion provided through 2-dy repurchase agreements.

Offsets, or easy monetary policy? Either way, you had better bolster your personal wealth holdings with a legitimate diversification out of dollars and into gold.


uponroofThis is not a GATA's a CBSmarketwatch update#596418/15/01; 11:47:49

Good Afternoon,

Got this heads up from 'The American Advisor':

This is from a market report bt Myra P. Saefong, but it reads like a GATA update. The word is now in mainstream reports. A few short months ago these same folks were crediting GATA with providing 'humour' in a dismal market.
Somebody stick a microphone in their face now and ask them what they think about GATA.

"...Bullion banks are "trying hard to maintain a lid on gold's movement up," said John Mesrobian, president of Constantinople Advisors. However, "they shall fail in the end for they are significantly exposed to their derivative positions, dollar positions and short gold positions and will be forced to cover as gold powers through and moves up."

HBM-thanks for your support, I am extremely pi**ed at the never ending charade which gets more and more obvious. Losing money for the last 5 years, at the hands of those who shorted and lost 'MY GOLD!'(USA) in the first place, is getting harder and harder to take. I hope all folks here are as upset as I, and are taking action through a relentless written attack on their political reps. (sending that GATA CBSmarketwatch article along with this one would be a good start).

Sir, Looks like no big afternoon bull raid today and yes I am ready for payback. Thanks.

site stewardRegarding Beowulf's msg#: 59579 yesterday#596428/15/01; 12:05:25

---- "MK, Just to let you know my order showed up today. THANKS! For those who didn't take advantage of the Russian coin offer back in June you missed out. They are some great looking coins."------

To all:
I'm glad to hear that the coins are pleasing to the eye. Why? Because early last week I decided the time was personally appropriate for me to exchange some additional dollar accumulations into gold... just the latest act in continuation of a larger ongoing program of regular diversification into gold.

As I had MK on the phone to discuss web-related items, I took the opportunity to put in an order for some representative Swedish Kronors (variety in life is good!), a heap of sovereigns, some Krugerrands, and a good stack of the Russian Chervonetz.

And that brings us to the point of this post.

If anyone has a continuing interest in these nicely priced Chervonetz, I'm more than pleased to report that Centennial still has access to these coins -- unless something has changed within the past week. (I'm not under the impression that I laid claim to the last they had, but I can't be sure. Give the office a call and discover how easy it is to do business with one of the nation's oldest and most respected gold brokerages.)


CoBra(too)@ Uponroof and HBM -#596438/15/01; 12:32:16

Sirs, please also consider these are the absolute last 8.500 tons of au, most of it already encumbered -at least according to James Turk, tons of au, which "were" backing - at least somehow - the big float of the US $ fiat currency. Which again is (was) the main reserve currency of the globe.
Though don't forget that between 1967 and 71 - the time of the London Gold Pool - the US had already lost 9.000 tons and late 79 another estimated 7.000 tons. All in defense of the fiat - can u say fraud, debauchery or what?
Is this the end of the line ... ?

Regards to all of you - cb2

BR549POG valued as PPP instead of FRN#596448/15/01; 12:39:58

The flippant statement that I posted the other day about CNBC's stating that the price of gold temporarily going up was the result of the dollar coming down. This was their justification and the only good thing they had to same about the recent rise in the POG.

But now that I think about it, isn't this what happened? So why is gold priced in FRN's? Because Greenspan, via going back on an unofficial fiat based gold standard, has made the U$ the world's standard currency pegging the dollar at around $275/oz.(+ or -)More plus lately than minus.

A recent post brought to my attention again that Greenspan has testified to Congress "that commodity market signals provide more useful and timely information than the official government data on prices, unemployment, national income and so forth."

So why is gold priced in U$ dollars, or Euro's, or any currency? When the dollar weakens, the price of gold goes up. But does it? Really what happens is the "relative price" of gold goes up.

Instead of the dollar, why not price gold in terms of a relative basket of goods and services that gold will buy. CRB 17 attempts to value the FRN in relative terms of buying power (some argue very corruptly), so why not gold?

I researched and found that there is an index that compares "currencies" relative buying power in reference to a basket of goods and services. A simple conversion of this basket of goods and services to gold should be possible.

"Purchasing power parities (PPPs) are the rates of currency conversion that equalise the purchasing power of different currencies by eliminating the differences in price levels between countries. This means that a given sum of money, when converted into different currencies at PPP rates, will buy the same basket of goods and services in all countries.

Current exchange rates on the other hand, do not reflect the relative purchasing powers of different currencies because they do not eliminate the differences in price levels between countries. Hence, a given sum of money converted into different currencies using exchange rates will not buy the same quantity of goods and services in all countries. "

Why not gold?

sector@uponroof The Good SDR News...#596458/15/01; 13:17:58 that the cabal is just about out of paper gold (SDRs) with which to suppress pog. There is evidence on the LBMA too. 16.1 million ounces transferred in July is the lowest on the public record since 1996. I read this as the big traders stepping back as they realize the charade of the "government price keeping action" is at an end.

The weight of evidence, journalist's attention and speculator awareness will smash the cabal long before October 9, 2001. Think of it, now that SDRs have been identified as proxies for physical gold their draw down is a clear view at the remaining supply...something speculators have always lusted after.

Currency crises experts such as Maury Obstfeld, UCLA describe a sudden [read instantaneous] collapse in government currency support measures as the norm. So we can confidently predict a rapid break in the gold market defense.

ALL the available cheap gold will dissappear in less than a can count on it.

MarkeTalkSaddam Hussein ready to attack?#596468/15/01; 13:24:39

David Dolan's Middle East report, which I consider to be head and shoulders above all others, reiterated the fact that Saddam Hussein is readying his troops (seven million "volunteers") to march on Jerusalem in preparation for a looming "war to liberate the holy city from Zionist occupation."

I find it more than coincidence that the following events are occuring at this time: a crashing U.S. Dollar (July 5th was the exact top), a gold price that is on the move (July 25-27th was the most recent low), and now a looming Middle East war. My friends, it is the power of synchronicity and the cycles which run through the markets and nature itself. The key is to discern the signs of the times--and these times are indeed becoming more turbulent with more volcanoes and eruptions (political and economic). Welcome to the endtimes. Mt. Etna is just symbolic of the upheaval that is ready to take place.

Combine the foregoing with the latest revelations from James Turk and perhaps my earlier prediction of $350/oz. by Christmas is too conservative. Arch Crawford believes we will see quick move to $300/oz. by September 1st! Something big is brewing out there. And don't forget about August 19th and the possibility that the Russians are ready to dump billions of U.S. Dollars on the market. In closing, I am urging all of my clients here at Centennial to add to their gold positions at these low prices. Call me before it is too late!


NetkingIsrael considers full-scale move into West Bank#596478/15/01; 13:47:38

"Expecting an increase in suicide bomb attacks, Israel has drawn up plans to greatly increase its use of force against the Palestinian Authority, senior Israeli officials told USA TODAY Tuesday. Israel also is debating an all-out invasion of the West Bank in response to another suicide bombing, they said. Underlining the policy of rooting out terrorism in Palestinian areas, Israeli troops and tanks took positions today . . . "
There's gonna be some suprised people in the days ahead with what happens. . . some folks will say with regards to the economy & M/East: "I didn't things were going to get THAT bad" . . . Some will will wish they bought gold earlier, lets hope none on this forum are part of that group. - regards Murray

colourofmoneyGold, wars and dollars#596488/15/01; 13:54:22


Gold certainly doesn't act like a rocket with the perspective of an invasion of the West Bank and the fact that the dollar got hammered real bad didn't help either.
Hill Billy MitchellIs this a serious move? See link#596498/15/01; 13:59:04

I do not remember seeing a three day move of the dollar like this since I have been gazing at these charts for over a year now. Is this new? Anyone know if this has happened since the introduction of the Euro.


site stewardBR549 on PPPs#596508/15/01; 14:08:47

You said, "I researched and found that there is an index that compares "currencies" relative buying power in reference to a basket of goods and services. A simple conversion of this basket of goods and services to gold should be possible."

I'm not sure that I follow your thoughts on this, so don't read too much into this reply if it seems off base. At the present time, similar to the international currencies implied in your example, a fixed quantity of gold will buy a basket of currency that varies in size from country to country. It, too, can be adjusted by the PPP from nation to nation to reflect its differing local purchasing power -- a phenomenon that represents unique local conditions, whereas unadjusted exchange rates "simply" represent the clearing levels needed for balance on the global economic stage.


NetkingColor of money#596518/15/01; 14:09:09

Sir COM, the future is at the very best "uncertain" (IMHO).

The USD is in bear phase, the markets are in & will have a propensity towards much greater turmoil in the days ahead like we have not seen in a long time. (I refer the future, not a one week wonder scenario)

Given all of the events & scenarios (as outlined on the forum in recent days). . . the days ahead . . . capital will seek a safe haven, gold will be near the top of this list as capital takes flight.

This is gold's time to shine . . .

CoBra(too)Sound Advice - from Mark Talk - #596528/15/01; 14:09:50

Barman says - gents last call - fill up your pints for the road home, today - and hey, before you can't afford to stay - another round as we may wish to mark up our liquid(ity) reserves - substantially!

Hope all of you will be able to afford another round - another day ... see u cb2

Cavan ManCB (too) and GC#596538/15/01; 14:21:39

Agree but, get one for the road and not "one for the ditch" aka a "ditcher". Barman, bring another pitcher!

PS: If I thoguht I had a business plan for the next McDonalds I would wait before implementing and buy gold now; right now. of course, a little "unemcumbered gold"; c'est tres bien mon ami?

Tree in the ForestHBM#596548/15/01; 14:35:23

Yeah it's a pretty good drop but nothing compared to what will happen when it breaks below 108.
Netking Silver - Ted Butler#596558/15/01; 14:40:13

The latest from Ted, focusing this week on topic of "The Commitments of Traders Report".

Snippit: ". . . This article about silver is going to be different from other articles I've written. As you know, I feel the most important aspects to the silver market are the continuing physical deficit, leasing and the paper short position. These factors account for the persistent low price amid production/consumption shortfalls and disappearing inventories. These factors will account for the certain price explosion to come. But, in the quest for knowledge about silver, there are other factors that effect the price, but are separate and distinct from the bedrock supply/demand fundamentals. I'd like to devote this article to a report that analyzes the most important near-term influence on the price of silver - trading on the New York Commodity Exchange, Inc. (COMEX). The report that offers this analysis is the Commitments of Traders Report (COT), published by the US Commodity Futures . . . "

Black BladeBone Pile Grows#596568/15/01; 14:54:44

Speedfam to cut 18 percent of workforce


CHANDLER, Ariz., Aug 15 (Reuters) - Semiconductor manufacturing equipment provider Speedfam-IPEC Inc. (Nasdaq: SFAM) said on Wednesday it would lay off 160 employees, or 18 percent of its workforce, in a move to reduce operating costs.

Black Blade: Adding to the "Bone Pile."

Black BladeHeaping Up More "Bones"#596578/15/01; 14:59:35

Motorola sees some job cuts as Ariz chip lines go


CHICAGO, Aug 15 (Reuters) - Wireless technology giant Motorola Inc. (NYSE:MOT - news) on Wednesday said it would close two semiconductor plants in Mesa, Arizona, over the next two and a half years, as it strives to turn around its money-losing chip unit.

Black Blade: Ditto! More "Bones" to heap on the pile. Not a good sign as the economy tanks. Unfortunately many of these people are "Grasshoppers" who are not prepared. A bit of PM insurance and savings would be of help instead of the worry that these poor souls are about to face.

Tommy PBone pile grows even higher!!#596588/15/01; 15:02:36

Look out below!
Black BladeI'm Tripping Over Lots of "Bones"#596598/15/01; 15:07:14

Corning Cable Systems Announces Workforce Reductions


CORNING, N.Y. & HICKORY, N.C.--(BUSINESS WIRE)--Aug. 15, 2001-- Corning Incorporated (NYSE:GLW) today announced that, effective immediately, Corning Cable Systems has reduced the workforce in its NAFTA region facilities to further align costs with current business conditions as a decline in the telecommunications industry continues. Approximately 450 hourly and salaried positions at Corning Cable Systems locations in North Carolina, Texas, Missouri, the Dominican Republic, Puerto Rico and Mexico have been eliminated. Additionally, the company has announced that another 450 employees have accepted one of three voluntary separation offers made by the company on August 3, 2001. That program gave employees a choice of taking early retirement, voluntary severance or voluntary layoff.

These job reductions bring Corning Cable Systems' total employment reductions since May 2001 to about 1,140 or 8 percent of its worldwide workforce of 14,000. Excluding today's Corning Cable Systems reductions, Corning Incorporated has eliminated approximately 5,900 positions this year. These reductions have been in response to the industry-wide downturn in the telecommunications sector.

Black Blade: Oh jeez - More "Bones" on the "Bone Pile." This is not a healthy economy.

CoBra(too)Gold Stock Indices had a great Day!#596608/15/01; 15:11:04

To whom it may concern! Who da ya think you're kiddin'?
All my gold stocks are up today and so are the gold indices. Only POG was down a little spittle as the PPT is even running out of natural liquidity.

What'dya say, e-bay - selling reality beats virtuality any day!


Hey, CM - how about extending an invite to the PPT - One for the Ditch - ask my female Beagle ... as she always barks when I mention last ditch efforts of sorts by the cohorts - of the president's (hatchet)men - amen...

Black BladeMore Job Cuts After Firstar Merger #596618/15/01; 15:13:53


Merger Between U.S. Bancorp and Firstar Results in More Job Cuts Than Expected

MINNEAPOLIS (AP) -- The merger between U.S. Bancorp and Firstar will result in more job cuts than previously expected.

Black Blade: This is just getting too gruesome. Too many people are getting hurt and the economy is in no condition to absorb these people back into the workforce. After all, how many burger-flippers and Walmart Greeters do we need anyway? These people too will be laid on the "Bone Pile." This is just a symptom of what lies ahead. Go for the Gold while you can.

Black BladeAsarco complex laying off miners#596628/15/01; 15:21:08


About 110 workers at the Asarco Mission Complex near Green Valley will lose their jobs as weak copper prices take another bite out of Arizona's once mighty mining industry. Asarco managers began notifying affected workers shortly after noon Tuesday at the huge open-pit operation, which employed 625 people before the layoffs. Most of the laid-off workers will be off the job within a few days, but a few will work through September.

Black Blade: Power costs are also a concern in this energy intensive business. More to be laid on the "Bone Pile." Too bad, I did a project for this mine a few years ago. A lot of good hard working people. This economy is going down and I'm afraid that this minor wave of layoffs will soon grow into a tsunami. Some PMs as portfolio insurance would be a very good move.

fastinfoThank god I did not invest in Semafo (SMF-Toronto) what a disater!!!!!#596638/15/01; 15:22:06

Thank god I did not invest in Semafo (SMF-Toronto) what a disater!!!!!
CoBra(too)@ BB and TP - my Suffy - not Scruffy- my Beagle ...#596648/15/01; 15:31:01

is the only one looking forward to your pink slip bone piles ... and even she's mesmerized by the size building up so quick that she is forlorn as to pick the right sized bone, marrow and all from this un-expected booty of AG's looty - though thanks for the bounty - I'm looking for a new county to bury all my skeletons, though I'm a'counting to find some recently cleaned out cupboards down in D.C.- Rerla dog's county - Suffy too ...
Cavan ManRE: USAGOLD#596658/15/01; 15:32:22

For "fence sitters worldwide"

Unpaid Advertisement:

I'd like to say I've known Mike Kosares and his staff for almost three years. IMNSOHO, this firm adds more value to the process of PM acquisition than any other I have dealt with. I know this firm from firsthand experience having had the pleasure of meeting our host several times over the past two years. These gentlemen and their staff are impeccably honest and they deliver what they promise, when they promise it. USAGOLD is a class act; honest, reliable and user friendly. In these parlous times (not sure if "end times" GC aka Marke Talk), I'd own metal and furthermore, I'd call USAGOLD today. Respectfully.......CM

BR549POG valued as PPP instead of FRN (part2)--#596668/15/01; 15:33:43

site steward (msg#: 59650)

Great question—But "not a basket of currency". A basket of goods and services. There is a huge difference. I agree that since PPP's establish relative buying power for each countries currencies, then how will imbalances be resolved in order to buy the same relative basket of goods and services in all countries. And I'm not sure that I know the answer other than if imbalances are currently being resolved with currencies, why not with a new measured value of gold stated in weight which never changes rather than in FRN's.

Indulge me in inventing a few new terms in an attempt to explain-

It can be argued that when the value of the dollar declines and the relative value of gold goes up, that this hedging is what investing in gold is all about. Of course, but isn't the knowledge of what your gold is really worth in terms of something real other than fluctuating FRN's, Euro's, etc. of more value? What I am proposing in agreement with some of my other favorite posters, is to quit thinking in terms of FRN's in relation to GOLD.

The advantage of pricing gold in Purchasing power parities (PPP's) equivalents rather than in FRN's is that the underlying value set for commodity prices and services is driven by supply and demand. Not to say that HBM's dreaded manipulation of prices does not take place but relative values are more free market determined than with the closed door corruptness innate to the Fed and other CB’ers in the world.

How can the POG be priced in PPP terms? I need some help here. Here is a first attempt but a word about currencies first.

There are only two ways to classify currencies:
value-based (VB) or non-value-based (NVB) fiat.

The rest of the world, recently lead by the Russians, are moving away from NVB paper to VB gold. The positive result of this economic strategy is to "bust" the FRN and move the Russian people away from the hoarding of greenbacks in exchange for VB gold coins. If I was a Russian, I would trade my FRN's for real gold coins. Wouldn't you? (In fact I do every chance that I get.) Of course extreme hoarding of currencies (both VB and/or NVB) is an economy killer. During times of fear, the people will stash VB and NVB currency under their mattresses and economic flows will slow down, then stop. (Like what's happening now in Argentina).

Now back to PPP's VB's for gold. If we are not going to abolish NVB (fiat), then how much is our gold "really" worth? My contention is as with all NVB currencies, it is worth what it will buy in terms of a basket of goods and services. So, if we begin today by establishing a representative basket (this is the tough part) and peg a value of gold to this basket, then a base line is established. This base line is then converted into some yet to be determined measured value such as grams of gold, oz's, an equivalent, etc and that is the real value of gold today in terms of purchasing power here and around the world. Let's call this equivalency "Real Gold Value" or RGV's for short. (It's a better name than SDR's and even FRN's I might add).

Commodity markets (and services values) and other free market price mechanisms via supply and demand will then establish new RGV values relative to a constant or base line for their individual currencies. RGV's are now the world standard and NVB currencies will now float in relative value against these VB's.

The advantages here are immense—You will know how much your physical gold is "really" worth in relative to world purchasing power. This new index will eventually remove HBM's manipulation as a tool for TPTB.

I agree there are indeed many unresolved questions in my mind. Since PPP's establish relative buying power for each countries NVB currencies, then can't these RGV's be pegged to buy on a world average the same relative basket of goods and services in all countries stated in a base rate similar to the "constant" or "real" dollars indexes which compare relative buying power value of FRN's over different time periods? Aren't these PPP type clearing mechanisms needed because of the fluctuations of local currencies against the manipulated NCV of the dollar?

Again, I am not suggestion redefining what is going on now but rather finding a way to think in terms of gold as value, rather than paper.

You're a pickin' and I'm a grinnin'

Regards from Cornfield County

Black BladeOil Jumps as U.S. Inventories Fall#596678/15/01; 15:51:20


LONDON (Reuters) - Oil prices climbed on Wednesday on new figures showing a third consecutive week of inventory declines in the United States, the world's largest energy consumer. The Department of Energy figures also showed a 1.5 percent draw in gasoline inventories to 204.6 million barrels, a sixth consecutive week of drops. The drop means gasoline inventories are now only just above last year's meager levels, and it comes on top of higher-than-expected fuel demand figures in the United States.

Two refinery problems in the United States also lent support to the market, as they could hit supply of refined oil such as gasoline and heating oil. Oil markets are preparing for lower supply next month when the OPEC cartel has agreed to cut output by four percent, or one million barrels per day, to keep prices up.

Black Blade: "Cheap Energy" is needed to resuscitate the economy. Energy is not going to be "Cheap" again. It is also near that time of year when refineries are shut down for routine maintenance ahead of the "switch-over" to reformulated "boutique" fuels for EPA clean air requirements. Look for a resumption of energy-inflation soon.

Black BladeRE: CB2#596688/15/01; 15:56:11

From what I hear from "people" I know, it looks like the Cortez-Pipeline Project should do well even at these prices. I see that they are just about the only ones in the state of Nevada doing any serious exploration. That has to be good for Coral's prospects - Robinson Ranch area maybe? Even so, eventually a good size hole for your beagle to bury his/her "Bones." Cheers!

- Black Blade

Black BladeRefinery fire threatens area gas supply#596698/15/01; 16:11:01


Gasoline prices are on the rise again, reversing a summer long slide and defying the season's typical pattern. And prices may go higher still as a result of an explosion and fire at Citgo Petroleum Corp.'s refinery in Romeoville early Tuesday morning. It was a burst pipeline that served as a catalyst for the record gasoline-price run-up early last summer, and experts have warned that any significant disruption to the supply chain could send prices back up quickly. The Citgo refinery is one of the few that makes Chicago's particular ethanol-laced gasoline blend, and its closure for any length of time will crimp the available supply of gas.

The impact of the refinery fire is compounded by the fact that many area refineries are going to be shutting down for maintenance in September and October. The Citgo refinery has a capacity of 155,000 barrels per day. Overall, it represents roughly 3.8 percent of the Midwest region's refining capacity of 4 million barrels per day. "This is not a minor damage situation," said David Sykuta, executive director of the Illinois Petroleum Council. "This is a major disruption to the gasoline supply."

Black Blade: Refinery utilization is at near full capacity. We are back to pushing the limit on Refinery capacity again. It's Déjà vu all over again.

CoBra(too)Hello BB - Close enough -#596708/15/01; 16:14:48

... Let's just settle on Crescent Valley - next to Beowawe - and thanks for your kind reply, also had some great events in Winnemucca - "Even the QEII. sailed the Humboldt" or years back ... meeting another car in the area you've got a severe traffic jam!
... and BTW I'm a big fan of your's and Suffy is too - also thanks to your bone supply ... cheers to u also! cb2

ShermagNatural Gas prices rise with small inventory build#596718/15/01; 16:33:27

I am surprised I beat Black Blade with this:

New York, Aug. 15 (Bloomberg) -- Natural gas had its biggest gain in eight months after a report showed U.S. inventories rose less than expected last week, as a heat wave spurred cooling demand in the East and a tropical storm curbed output.

Supplies in underground storage rose 3 billion cubic feet to 2.29 trillion, the smallest increase this year, the report from the American Gas Association showed. Analysts surveyed by Bloomberg had expected a gain of about 64 billion cubic feet.

``No one predicted a number anywhere near this,'' said David Chang, managing director of natural gas trading at Bank of America NA in New York.

Shermag: To those of us that follow this forum, this should come as no surprise. Thanks Black Blade, for all you do here.

CoBra(too)Forgot to say - Suffy is looking forward#596728/15/01; 16:38:57

to an open pit'able deep storage bone deposit and would even invite Scruffy for a bite, though Cortez is just working away at the final depositary - too early for the Suffy's bone dormatory ... (sorry for plagiaratizing Scruffy, at another site), otherwise we (us) dogs smell the stink of fiat burning long before the fat Beaure-au-cats even start to notice their singed tails are leavin' stinkin' trails - to no avail as we all know - even AG is pouring on more Kerosene - to cover or douse his trail - before he performs his high-tail class act ... as even though his reputation won't be intact ... ever say's Suffy too - cb2, may be back too.
BR549HBM's Manipulation#596738/15/01; 16:50:16

Hill Billy Mitchell (msg#: 59551)

I'm a pickin’ & I hope you're a grinnin’

I tend to comment on other's posts/research rather than use my posts to link to research for a couple of reasons—I do not enjoy the process of research and there are many here and at other sights including yourself, BB, Netking, auspec, Raha, ski, CoBra(too), uponroof, escapethematrix, Tree in the Forest, Sierra Madre, Tommy P , and too many more to mention are doggone good at it and a heck of a lot better than me. I worked my way though school doing research and then taking that research and writing a synopsis for a professor. He sometimes almost verbatim published my thoughts in "The Journal of Marketing" under his name with no credit to me. I hope never to do that so if I do, believe me it is not intentional. So more power to you researchers for a job well done.

I don't like the connotation of argumentative but as part of my pickin’ and grinnin’ philosophy, I will pick at your earlier highly regarded post a little bit and then hope we can all do some grinnin’.

I agree with your previous post's intent of drawing a line in the sand in reference to the evils of manipulation. How AG&C manipulates is indeed at a higher level and is evil. However, I respectfully disagree with you in reference to your opposition to ski's contention that "virtually ALL SALESMANSHIP and ADVERTISING are inherently manipulation". I have had dozens of professional sales training courses in the computer industry and can assure you, that statement could not be farther from my experience. I contend that our economy and modern capitalism runs on manipulation.

What we are talking about is the connotation of the word manipulation. Let's focus on Webster's "To control or play upon by artful means." And then tell me that the clever advertising spots you see on TV and magazines is not manipulation. Look at "Joe Camel" and beer advertisements directed to teens, college students, high schoolers in order to get them hooked and develop the manipulators emerging market. When I was in high school on some mornings, a Marlboro truck was parked out in front of our school giving away little sample mini-boxes of Marlboro's to the students. Guess they were meant be taken to their parents but somehow most of them never made it including a few of mine. After too many cigarettes, I quit smoking on September 13, 1963 and would contend that although I was responsible for that decision, I was manipulated into doing one of the stupidest acts that I ever did. My candidate for "Mother of the Century" and me in turn manipulated, coerced, begged, snooped, invaded privacy, and did whatever else within a parent's capabilities and control to keep our kids off of drugs and away from tobacco. I thank God every chance that I get that I have child who is a computer sales rep (yes, a manipulator) and one in the first year of Med School. Neither do drugs or smoke, but like their parents, did not escape the manipulations of the Miller Brewing Company. We were fortunate, but some like Carroll O’Connor and other's were not able to fend off their offspring coming under the influence of some of the unscrupulous manipulating drug salesmen. People that do smoke or do drugs (same thing)-that's fine just don't ask me to pay for your lung transplants with my tax dollars.

GE Jack's PR Machine is an all day attempt everyday to "artfully control and play"-Mr. Webster- upon the Sheeple to get them to liquidate their commenting analyst's firms "dog stock" positions to their detriment. This manipulation is then exchanged for FRN's in the "art" of advertising.

I used to have a friend of mind who was a great believer in situational ethics. His ideas were-- that it depends on the circumstances whether something is ethical or not. His example was the dying men in the lifeboat killing and eating a prisoner to survive, etc. was justified because of the situation. My contention, which I think is the same as yours, is what's right is "RIGHT" and vice versa. The situation is irrelevant.

Too say that salesmanship and advertising is not manipulation and this isn't what drives this economy, in my respectful opinion, is ludicrous. Is there a line in the sand between legality and what the definition of what "is" "is"? Isn't this what we're really talking about. Isn't this why our nation has more lawyers per capita than any other nation in the world. If it's legal--then isn't it all right? "NO!" and THIS is where we agree, if it is not moral and ethical, then it is NOT OK regardless of the law. Sometimes if it is legal (such as stealing our gold ownership from our treasury may be legal) but it is indeed an "HBM manipulation" and is wrong.

So there is no gray area in my mind, it is all black and white: advertising, sales, Wal-Mart's price rollbacks, CBNC, the government concealing there is a nuclear bomb lying in the water off of the coast of GA-----they are all manipulations

So in honor and respect for your ideas, in the future all of my posts in reference to "evil and insidious manipulation by the Fed and the other PTB" will be stated as "HBM's manipulation of….".

Very Respectfully,

So Sir HBM, Regards from Cornfield County

NetkingIraqis call for 'liberating Palestine' under Saddam#596748/15/01; 16:55:19

". . . Thousands of Iraqis took to the streets today, waving guns and calling for the "liberation of Palestine" under the leadership of Iraqi President Saddam Hussein.

. . . more than 7 million men and women – roughly one-third of Iraq's 22 million population – are said to have volunteered for the forces . . . "

R PowellFrom sector's 59645#596758/15/01; 16:57:06

comes this quote which, I believe, should be emphasized again,
"Currency crises experts such as Maury Obstfeld, UCLA describe a sudden (read instantaneous) collapse in government currency support measures as the norm."
How can A.G. and his FOMC partners lower rates again to support the Dow and Duck when doing so will weaken an already sinking dollar?? Add some real inflation numbers to further lower the real return on dollar denominated assets and we might see the retreat of foreign owned investment out of our markets. Uninvested dollars become Bigfloat unchained, on the loose and dangerously threatening to return home as a flood of paper looking to exchange itself for something tangible.
I think sector is correct in warning that currencies that are traded electronically all day and night can collapse in a heartbeat.
Now to clean up this place. Seems someone has been throwing bones everywhere. It's a mess!
Netking, thanks for the Butler fix.

CoBra(too)@ BR549#596768/15/01; 17:26:56

Sir, It's great to see you phil-ling in some real Phil-osophy, though it's getting a bit late for me to respond in kind ... not that I could, anyway, even if your tongue would've been my first lingo, I would feel extremely in-adequate to cross intellectual swords in any way with you, my friend, as your thoughts are penetrating to a level, I've been trying to suppress - though still seeing the evil - and to my distress NOT - it is great minds like you, which will rescue liberal thought.
Thank you - cb2 ... and please remember me - to annie ...

wow ... is this ONE sentence or what - war ned you -

slingshotBR549 PPP#596778/15/01; 17:30:42

What equation should we use for the price of gold to goods and services. That is a tough one. Have to start somewhere so here is an idea.
The 1 0z gold eagle has a fifty dollar value as currency.
We all know this is a rip off. Anyhow I figured we have to go back when 1 oz of gold was a solid 1 oz purchase power.
Enter the Gold Rush of 1849. What would the pioneer of 1849 get with 1 oz of gold. I am gong to use Fifty dollars an oz as a base. Lets see.
Mule $10.00
Mule pack frame $5.00
Shovel $2.00
Pick $2.00
Axe $2.00
Pants 2 pair $5.00
Shirts 2 pair $3.50
Gold pan $1.00
Hardtack 5 lbs. $1.50
Jerky 5 lbs $2.00
Blanket 2 $2.00
Knife $3.00
Firearm with bullets $11.00

The prices will be off somewhat yet fit the requirements of goods and services for most of them were made by hand.
Now lets move to 2001 and allow 10X the price of 1849 gold for inflation and trying to stay apples to apples under $500.00
Firearm 12ga single $79.00
Knife $20.00
Blankets 2 $10.00
Jerky Teriyaki $75.00 $15.00/lb
Hardtack $15.00 $3.00/box
Pan $10.00 Guess?
Shirts 2 $ 50.00
Pants $ 60.00
Axe $ 12.00
Pick $ 7.00
Shovel $ 5.00
Pack frame and pack $ 70.00 Military
Bike used $ 80.00
Shotgun shells 2 boxes $ 7.00

The two lists are apples to apples with the 49er getting the best for fifty and myself for Five Hundred. Maybe thats where the price of Gold should be now? Are we looking for an honest barter system.
What do you think?

BR549Grinnin’ back#596788/15/01; 17:45:24

Let me pick myself up off of the floor and hope my sides will quit hurting soon.

@ slingshot-

I love your basket of goods and services. Let's see, we're at CRB 17 now so I think your list should probably be labeled CRB 1. Which is great for gold mining activities.

@ CoBra(too)-

So, I have been outed, huh?

If there is a nomination for the Grinnin’ hall of fame, then it will be tough to choose between you two.

Let me get my breath.

Solomon WeaverThe basket#596798/15/01; 17:51:45

Hey slingshot

I really think it is great that you are thinking this through....

The only part that makes the whole thing strange to me is if I look at your basket I realize that the goods that people needed back then look today like the things I want to take out camping for the weekend.

The purchasing power of gold needs to somehow be correlated along with all the things we can buy today that weren't around back then.

One example...

Knee surgery

Back Then - not available

Somewhere in the 70s....$20,000 and you sit at home for 8-12 weeks or more before you are off crutches.

Somewhere in the 90s.....$8000 in outpatient orthoscopic clinic and you are back at work the following week.


It was recently announced that the first all mechanical (titanium) heart was used in a transplant....


I really love all of you guys on this forum, and I agree that America has lost in many ways the moral strength that we had...the brave generation. But, any view of reality that does not encompass the phenomenal impact of advances in science and engineering in the last 50-100 years is not an objective measurement of reality.

I too am guilty of glorifying the days when we did it with our own hands (from firewood to changing a spark plug), but the coming times are going to be done with our minds....our world becomes ever more shaped by our mental energy...what we plan and invent and engineer.

Value cannot be measured in baskets.....Gold is perhaps better something which when allowed to temper our fiat systems, will unleash even higher levels of creativity, as it creates a system that can really work for entreprenuers and investors and talented inventors and businessmen.

Poor old Solomon

NetkingBullion Bank's are "trying hard to maintain a lid on gold's movement up" #596808/15/01; 18:13:21

"Bullion banks are "trying hard to maintain a lid on gold's movement up," said John Mesrobian, president of Constantinople Advisors. However, "they shall fail in the end for they are significantly exposed to their derivative positions, dollar positions, and short gold positions and will be forced to cover as gold powers through and moves up." (sourced from Dave Morgans
slingshotSolomon Weaver Msg# 59679#596818/15/01; 18:35:22

I will agree with you somewhat. I believe gold should be valued against hard durable assets. Land for instance1/10th acre for 1 oz. Water in the future may be an measure of gold. I will agree with your medical point if you adjust for hyperinflation. Maybe one of the comparisons should be that it lasts for X amount of years. Not like a computer or car.
Should it be dependable in some sort of way? Then shall it benifit man and be available to all for one ounce of Gold.
Untill we find that item that fits That criteria we will be subject to the judgement of the fiat system.

site stewardBR549 -- On baskets of "things"....#596828/15/01; 18:47:31

Sorry for the confusion I introduced. Having read your reply, I had to reread my comments and saw that my fingers did not correctly transfer the thoughts that were in my head, thus undermining my effort. If you stick around a bit, you may discover I'm not always as dumb as that post of mine surely made me look, because it definately made no sense as written -- I typed "currencies" where I meant to type "goods". The following excerpt is the corrected version (capitalized), and the rest of the post stands as is.

"At the present time, similar to the international currencies implied in your example, a fixed quantity of gold will buy a basket of GOODS that varies in size from country to country. It, too, can be adjusted by the PPP from nation to nation to reflect its differing local purchasing power...(etc.)"

Thanks for calling attention to my blunder. The post (msg#: 59650) should now make sense with the above revision to deliver the thoughts as was originally intended.


Solomon Weaver(No Subject)#596838/15/01; 19:13:50

slingshot today and beyond, we find dramatic differences in land and home prices......depending a lot on how good the "jobs" are in the region...and jobs are definately an intangible.

I see the value of using the changes in prices in tangibles to look at gold....but in a society where ever more of our consumptions are in the non-tangible realm (like a movie video....the same plastic box can hold dramatically different content...ideas...).

By the way, in my knee surgery example, hyper inflation only feeds my arguement.

Granted, Dr.s make mistakes, but by and large, the level of diagnosis and treatment available to the common American today is vastly superior to 50 years ago......and the "only" difference is "knowledge"....we have learned how to "apply" our minds to medicine.

What is the value of a new diagnostic that eliminates $5 billion worth of unneeded treatment?

I am a gold heart....but in this vein I am a devils is our liberation into a time when we will create immense new things.

Poor old Solomon

Tree in the Forestmegatron#596848/15/01; 19:17:14

Be careful with Yamana. I looked at them rather closely. They looked like a very good leveraged play, until I had an opportunity to speak to the President. Barrick sits on their board of directors and owns 4 million shares. I asked him whether he felt comfortable with this shark on his tail. He seemed very satisfied that Barrick was a "friend" of the company. With friends like that, who needs enemies. Barrick has a large silver short position last I heard. When silver is ready to blow, they'll swallow Yamana whole just like HM. Watch yourself out there!
R PowellGold Standard#596858/15/01; 19:25:32

Once there, scroll down to Commentary and click on "Is it time for a return to the gold standard?" by Tom Calandra.
Also for Canuck, same place, home page in the upper left hand corner you can type in Nem (or any stock symbol), and click to follow afterhours trading.

Max RabbitzJames Turk and those SDR's#596868/15/01; 19:39:59

James Turk has done an outstanding job in penetrating our mysterious banking cabal. It's had me thinking this last week, always a dangerous thing.

Sir Turk says "The Second Amendment to the Articles of Agreement of the IMF, which came into effect in April 1978, eliminated the use of gold as the common denominator of the par value system and as the basis of the value of the SDR." If so can we really say 35 SDRs is equal to one ounce gold? Also, remember that there are no corresponding liabilities kept on the IMF books.

In any case, as of December 2000 the Federal Reserve had 2,200 million SDR certificates left from the 10,539 SDR's owned by the ESF, or slightly more than 20% of the possible SDR certificates were still held by the Fed. To convert the 10,539 SDR's to tonnes of gold (35:1) gives me about 9,410 tonnes. But isn't this more gold than the U.S. claims to have, about 8000 tonnes? Or am I using funny math?

I suspect Turk has got a hold of the beast but there are a few twists and turns left to discover.

BR549Gold being valued in hard durable assets vs. PPP's#596878/15/01; 19:42:51

slingshot (msg#: 59681)

How much is your land worth? Is it worth $200,000 dollars? 165,000 Euro's? Or say a pound of gold? Everyone's current thinking is in terms of U$ fiat currency. Why isn't it worth a pound of gold? Because you do not know how a pound of gold is valued except in thinking about it in terms of an HBM manipulated fiat.

Your land is worth what it will buy in terms of your inflated gold prospector's basket of goods and services yesterday relative to what it will buy today. So, if you step outside of your current dollar oriented valuation of wealth, what is your land worth in gold?

The perplexing thing about currencies is that there are no constants. Supply and demand for commodities how you should determine the relevant value of your land. If your land is worth $200K today, which is the equivalent of a pound of gold, then depending upon the fluctuations of supply and demand for a basket of goods and services, it may be worth 1 pound 3 oz's next year. What is gold worth? What 1 pound 3 ounces will buy relative to its computed index which are based upon a basket of goods and services, similar to what the PPP index provides.

If you meant your last post as a topic for serious discussion, then my apologies for making light of it. I really got a kick out of your basket of goods and services. The main problem is how do you establish what this initial basket of today's goods and services are? My contention is the PPP has already established this basket for the exchange of currencies, so why not use this established index for gold? I'll give you 6 pounds for your land site unseen.

site steward (msg#: 59682)

No problem. I have read many of your earlier posts and believe me I don't think they are "dumb". Correction noted and if you read my posts, my fingers or my hateful computers, do the same thing. My response to your original post, aside from the first paragraph, taking into account substituting the terms basket of currency for basket of goods and services is duly noted.

Aside from the above, which will not cloud the issue of my answer to your post, what do you think about establishing a base for the POG using PPP's basket to begin with?

Solomon Weaver (msg#: 59679)

The problem with any index that tries to measure current value in reference to the past, is changing technology. Look at computers bang for the buck or medicine. But why a buck? Slingshot's mule may be replaced by a tractor or 4 wheel drive, but everything is still stated in relative value to current supply and demand of a basket of goods (or commodities) and services. If you needed a brain tumor removed, and had the assets or insurance, I am sure you would not call all of the brain surgeons in town and find the cheapest doc. Likewise technology will reduce prices but not reduce the price in relative terms of what you would pay for the "best". So would you pay $100,000/FRN's OR x amount of the weight of gold. You don't care if you get the service that you need, but brain surgeon's prices around the world relative to the weight of gold as an index of relative values of a basket of gold's and services might let you compare prices around the world in terms other than the U$ dollar, or Euro's, or any other fiat if you were shopping for the cheapest skull cutter.

Hill Billy MitchellCavan Man @ # 59665#596888/15/01; 19:54:52

For "fence sitters worldwide"

Sir Cavan Man

Have you seen the movie, "One Against the Wind", with Judy Davis and Sam Neill?

There was a great line by Judy Davis, when the American consulate said, "but we are neutral". Her comeback was, "There is a special hell for fence sitters, Smallwood."

Just thought you might enjoy that.

Very respectfully,


auspecNetking #59606#596898/15/01; 19:55:14

Murray, I enjoyed reading your silver prognostications much more than writing my own! Looking back on the last years gold chart pretty much shows a controlled flatline, tight range. Silver has been totally under control also. Credit to the manipulators for the last 12 mos. Now let's see what what you can do over the NEXT 12 mos!
WHEN silver hits the wall it will be a story to tell to your heirs. They won't tire of hearing it.

Canuck@ R. Powell#596908/15/01; 20:09:13

Thanks Rich
Netking"Euro rises because US economy weakens" - EU Observer#596918/15/01; 20:21:49

". . . The euro has hit a three-month high against the dollar, breaking the psychological 90 cents barrier, and also reaching a five-month high against the pound.

The euro's rise is rather seen as a growing fear of an economic recession in the United States than confidence in the European currency. Last week, the US Federal Reserve released the overview of the United States economy, the pessimistic Beige Book, which described economic growth as stagnating . . ."
McAgSpec - Thanks Sir, more power to "the clan".

darkhorseNetking (08/14/01; 23:12:53MT - msg#: 59606)#596928/15/01; 20:24:56

I've been catching up on my reading, and after reading Netking's post yesterday (from MIA) re: gold/silver ratios, it occured to me that we're at a 64:1 ratio...more than 4x historical norms. Even if todays price of gold was normal (in the immortal words of Mork: ArAr!), silver would stand at about $17.50! I wonder how long we can stay this weird! :)
slingshotBR549 Msg#59687#596938/15/01; 20:31:41

Glad you enjoyed my 49er equation or CRB1. As a thought as to why it is hard to value Gold to anything but fiat is because it has always been thus. Compound that in the electronic transactions of a cashless society and gold has its work cut out to reach the consious mind. Gold for the most part is jewelry to the average person, until a problem occurs in their financial world. They accumulate not invest.

slingshotBR549#596948/15/01; 20:50:45

Is that six pounds Gold?
Six pounds British?
Six pounds Corn Beef?


USAGOLDAll. . .Conversation with Sir James Turk. . . .#596958/15/01; 20:57:01

In talking with Mr. Turk yesterday to clarify some SDR matters, he mentioned that he stands by his prediction of gold at $380 by the end of the year. I do not think he would mind my passing that along . . . .along with my recommendation to subscribe to his newsletter "Freemarket Gold and Money, " a very good newsletter for goldmeisters no matter where you live.

If what Mr. Turk hopes for occurs, I might add, the anti-gold cartel will have been broken, the euro will be on the ascendancy, and American investors will be headed for a possible repeat of the 1970s when the dollar declined against major currencies by 70% and gold rose by nearly 25 times.

October 9 looms large, and though I don't put my eggs in that basket (nor should you), I do respectfully advise the Boston judge:

"Let the case be heard!"

To do so would be in the best interest of our legal system which purports to defend the weak against the powerful; the lawful against the unlawful; the plundered against the barbarian.

A quintessentially Jeffersonian thought for this fifteenth day of August when we in in the high country cross over from the far side of the summer doldrums. The nights get cooler with the hint of Fall -- golden autumn and the investment new year. Promise fills the air . . . . . .the mind quickens; the soul settles; my favorite time of year.

My best wishes and thanks to all who post here for making this one of the finest discussion forums on the internet.

I would like to make a special appeal to our lurkers to gain courage. . . .join in. I think you will find new friends here and an experience that might become an important and rewarding part of your daily routine. . . .Who knows, you might even have a positive effect on someone.

Black BladeAsian Markets Falling Again!#5969608/15/01; 21:33:48

A couple of days ago the Nikkei rose fast and furious on news of more liberalizing on behalf of the BOJ. After tonight that gain could be wiped out as Asian Markets continue to collapse. The word is that the BOJ is back in the market to prop up the Nikkei. If so, it does not appear to be working. There are rumors that a couple of major Japanese banks are teetering on the edge of bankruptcy. The recent liberal stance by the BOJ on monetary policy could be part of a plan to salvage these banks and also to save the "insolvent" Japanese postal fund. I still look for more info for serious confirmation though. These are certainly "Interesting Times."

- Black Blade

Black BladePoll: Economy in Bad Shape#5969708/15/01; 21:50:53

Fifty-one percent of Americans give the economy poor ratings, the first time in four years that a majority of the country felt that way.


Fifty-one percent now call the economy "not so good" or "poor," the first time since May 1997 that a majority of Americans felt that way. Americans' rating of the economy has been in a steep decline - positive ratings of the economy have declined by 22 points this year and by 31 points since January 2000. Optimism about the future is also in short supply: Forty-six percent say the economy is getting worse, about the average all this year. Just 16 percent think it's improving. (On the other hand, in 1990 a record 77 percent said the economy was worsening.)

Black Blade: There goes consumer confidence.

Black BladeYen Halts Gains vs Dollar on Speculation Japan to Sell Currency#5969808/15/01; 21:57:01


Tokyo, Aug. 16 (Bloomberg) -- The yen halted yesterday's 1.8 percent gain to a two-month high against the dollar on speculation Japan may sell the currency to prevent its further ascent from hampering the economy by hurting Japanese exporters profit. ``Speculation for intervention is getting quite strong, dissuading some market participants from pushing up the yen further,'' said Shohgo Nagaya, foreign exchange manager at Nomura Trust and Banking Co. Haruhiko Kuroda, Japan's vice finance minister for international affairs, said the yen's rise is inappropriate and Japan will take appropriate steps if necessary.

Black Blade: As the SNL Church Lady used to say - "Isn't that special!"

justamereBearSolomon Weaver Slingshot Netking#5969908/15/01; 22:12:55

Thanks for the link. I had not seen that one. A bit detailed for my purposes, but useful. I have bookmarked it. Kind of fun to watch those lights blinking red and green.....Its beginning to look a lot like Christmas ....lights (all over town) blinking red and green. :>))

Solomon Weaver Slingshot, et al
Solomon- I like your knee surgery example, and I don't. The problem I have been struggling with is more assuring myself, and mine, of a continuing supply of those goods and services that are now available. I had little interest in making up a basket to determine what value my gold might go to. Fun, but there are more serious problems, IMHO. In your knee surgery example, (and I agree that technology changes the equation, but how?) you have a last/current price of $8,000 and one week off work. True enough. But how many of these operations , or even equipment to do so, are available in third world countries?

Therein lies the rub. I seriously expect North America (and the rest of the world) to be busted back to third world status at least. If no one has the $8,000 seed money to have such an operation, how long are the skills to operate the equipment going to last? and the equipment itself? So, how much of this technology is going to survive to effect the equation? Some, undoubtedly, but surely not all. History abounds with examples of inventions being re invented a century ot two later.

I like slingshots mule, especially if Black Blades energy prognostications run to their logical conclusion. The turn of the century energy sources are going to be about all we have. But then what happens to the prices of mules, when everybody wants one, and there aren't enough to go around? Add a few other variables such as AIDS, the declining ability of the earth to support the population, (even using hi tech methods, never mind having some of them disappear because the oil ran out)the physical arrangement of the population, (back then, everybody had a backyard garden to grow a few veggies. How many hi rise condos today have even a balcony?) etc. Lots of variables, most of them interelated, and with a fairly high risk of a very negative downside. [Maybe we should be buying mules instead of gold :>)) ]

Will mules be priced at such and such a price, relative to todays Big Mac? I doubt it. But maybe so. It may be that protien in general is so scarce that it will cost a fortune for a hamburger.(using whatever passes for a medium of exchange then)

Personally, I have been going after sources of supply (mostly home grown) with large dollups of liquidity in what I think will likely BE liquidity, precious metals, thrown in to allow me maximum flexablity.

However, as one poster, (Canuck, was that you?) posted some time back
I buy gold (as a safe haven)
I buy siver in case I am wrong about the gold.
I buy groceries in case I am wrong about the first two.


megatronTree in tha forest#5970008/15/01; 22:39:10

Thanks for the warning. I looked at Yamana about three years ago and went with other silver land holders such as Minefinders and CornerBay. They don't run any mines. Yamana was/is strectched way too far for a junior. They are in the same boat as Eldorado, being systematically crushed to get at thier assets. A few will survive to unreal returns, Most won't. Some one will get them for a cent on the dollar.
megatronIs Wanniski drunk?#5970108/15/01; 23:15:35

Where does he get this 'fantasy' $350 gold price, that would solve the worlds money ills? The more I read of his, the clearer it is he 'taught' himself 'cypherin'. Can he do simple arithmatic?
site stewardBR549, you asked my opinion:#5970208/15/01; 23:32:34

---"...what do you think about establishing a base for the POG using PPP's basket to begin with?"----

As noted previously, in the role of "site steward" I'm on thin ice to give opinions, so let me skate around the issue with this watered-down statement:

Looking ahead to a more level playing field (i.e., as dollar hegemony is cast down), we (in the U.S.) can gain some initial insight into the future valuation of gold here by looking at its strength on a PPP basis elsewhere in the world today. Quite impressive.

Beyond that, I would never think seriously about throwing a rope around "the market".


NetkingLooking for somewhere to turn . . . #597038/16/01; 03:15:15


" . . . "The yen's rise has me nervous and the unrelenting fall in the tech sector is absolutely killing me", said Masaru Kazama, head of equities at Nissan Securities. Looking for somewhere to turn, short-term dealers are throwing money into real-estate and construction firms that could benefit from an urban revitalisation scheme. . . "

Meanwhile the Nikkei 225 has another downer as it heads towards 10,000 & Europe opens in a sea of red . . .

Canuck@justamerebear#597048/16/01; 05:02:11

I struggle to remember the line but I think it was:

I buy gold (as a safe haven)
I buy silver in case I am wrong about the gold.
I buy guns in case I am wrong about the first two.

Hey, the situation is getting so bizarre (check Japan and China, up and down violently) that when TSHTF (and NIBW) if things are whacked beyond gold and silver, neighbours will be taking shots across the street at each other.

The scheme of things, IHMO, has the potential to be anywhere from dismal to frightening. I've been digging deeper and deeper into Mr. Blade's energy synopsis and there is not the slightest doubt in my little mind that the energy situation is dark (ever go down a mine, say a mile under and turn the lights off; that kind of dark). World oil production peak is scheduled for 2008 and OPEC/NON-OPEC production is set to 'crossover' in 2006 (I