USAGOLD Gold Discussion Forum Archive

Electronic reproduction sourced from
OperativeStupid Is As Stupid Does#8630010/1/02; 00:49:37

Oct 1, 2002

A Look at U.S. Shipments of Pathogens to

The Associated Press

Shipments from the United States to Iraq of the kinds of pathogens later used in Iraq's
biological weapons programs, according to records from the Centers for Disease Control
and Prevention, the Senate Banking Committee and U.N. weapons inspectors:


Iraq admitted making 2,200 gallons of anthrax spores and putting some of them into
weapons. U.N. inspectors said Iraq could have made three times as much anthrax as it
acknowledged, and could not verify Iraq's claims to have destroyed all of its weaponized

The American Type Culture Collection, a biological samples repository in Manassas, Va.,
sent two shipments of anthrax to Iraq in the 1980s. Three anthrax strains were in a May
1986 shipment sent to the University of Baghdad, which U.N. inspectors later linked to
Iraq's biological weapons program. A 1988 shipment from ATCC to Iraq also included four
anthrax strains.


Iraq admitted making 5,300 gallons of botulinum toxin, a deadly poison produced by the
Clostridium botulinum bacteria, and putting some of it into weapons. Five warheads filled
with botulinum toxin are missing.

ATCC sent six strains of Clostridium botulinum to the University of Baghdad in the May
1986 shipment. The September 1988 ATCC shipment to Iraq also contained one strain of
Clostridium botulinum.

In March 1986, the CDC sent samples of botulinum toxin and botulinum toxiod (used to
make a vaccine against botulinum poisoning) directly to Iraq's al-Muthanna complex, a
center for Iraq's chemical weapons program and the site where Iraq restarted its dormant
biological weapons program in 1985.


U.N. inspectors concluded Iraq could have produced hundreds of gallons of the germs that
cause gas gangrene, though Iraq admitted producing just a fraction of that amount. Gas
gangrene, caused by the Clostridium perfringens bacteria, causes toxic gases to form
inside the body, killing tissues and causing internal bleeding, lung and liver damage.

ATCC sent three strains of Clostridium perfringens to the University of Baghdad in the May
1986 shipment and another three strains in the 1988 shipment.


The CDC sent bacteria samples to Iraq's Atomic Energy Commission in 1985, 1987 and
1988. The commission was involved in Saddam's attempts to build a nuclear bomb and
other weapons of mass destruction.

The CDC also sent bacteria samples to the Sera and Vaccine Institute in Amiriyah, Iraq, in
1988. The institute stored samples and did genetic engineering research for Iraq's
biological weapons programs, U.N. inspectors found.

AP-ES-10-01-02 0203EDT

This story can be found at:

Black BladeMarket Indicators - Free Fall?#8630110/1/02; 00:53:31

Interesting market indicators (so far). The US market futures suggest a stock market in free fall. Perhaps, as the window dressing is done for end-of-quarter. The USD is off slightly as is gold. Petroleum is rising as another hurricane is headed straight for oil and NG platforms in the Gulf. Energy companies are evacuating production facilities while inventories and production are falling. Looks like "entertainment" tonight as the lemmings scurry about. Grab a cold one, sit back and enjoy.

- Black Blade

kasperjackUp Uranium#8630210/1/02; 01:08:20

Sometimes you want to see something so bad you
lose your grip on objectivity.

Black BladePort Shutdown May Cause Empty Shelves #8630310/1/02; 01:14:58

Empty Store Shelves, Quiet Factories Could Be a Result of Lengthy West Coast Port Shutdown


WASHINGTON (AP) -- A prolonged shutdown of West Coast ports could lead to empty store shelves, quiet factories and a global economic crisis, analysts say. "The collateral damage is huge," said Stephen Cohen, a regional planning professor at the University of California at Berkeley. "We've never had anything like this. This affects the entire economy." A stalemate could be disastrous for the U.S. economy, which already is teetering between recovery and recession. The cost has been pegged at $1 billion a day. The problems could snowball quickly, according to his study conducted for the Pacific Maritime Association, which represents shipping lines and sea terminal operators. A 10-day shutdown could cost the country $19.4 billion. "A few days or couple of weeks -- most retailers and businesses are prepared for that," Zandi said. "But a month or two -- that becomes a significant global economic problem."

Black Blade: If this is not resolved soon, it is a sure bet that the Feds will force the dockworkers on the piers and the unloading to begin. In the meantime a lot of delays and dwindling inventories during a lead up to peak shopping season. Of course the consumer is not likely to spend much for the holidays this year. I know I'm not.

BTW, Euro markets are gingerly testing the positive side now.

Black BladePundits Ratchet Up Gold Outlook#8630410/1/02; 01:47:24


The Commitment of Traders Report for New York's Comex market, released Friday, showed large speculators accumulating gold contracts and taking their net long position in gold to 4.48 million ounces – an increase of 1.8 million ounces for the week. The long position also takes bullion closer to this year's peak long position of 10.1 million ounces seen in May, according to UBS Warburg's daily precious metals note. While the COTR report certainly demonstrates the market's belief that bullion has the potential to catapult beyond its initial resistance level, the longs are increasingly viewed as a double-edged sword. The greater the long position grows, the more chance there is of a long liquidation by speculators which could bring gold clattering back to the mid-teens. There is, however, according to analysts, a growing element of pure portfolio insurance emerging among funds entering the gold market; with bullion acting as a buffer against falling markets. The new buying behaviour has effectively reduced the proclivity among investors for large-scale selling when the metal does not rocket in the short term.

Black Blade: I have been skeptical about using COTs as a defining measure of market direction. The market conditions have changed and the market is attracting more and more interest for somewhat limited supply of metal. Under these conditions it is only natural that net long positions should increase whereas during the "ugly" PM market of the last few years this might have been perceived as a negative indicator. Now it is likely that it could be a positive indicator in a small market that is gaining a growing acceptance among the investing public.

BTW, Euro stock markets have turned negative. Watch them lemmings run!!!

slingshotGoldnSilver2002 Msg# 86261#8630510/1/02; 01:52:06


I have to agree with you that drawing a line in the sand or to estimate a break out for gold can give false hopes to those newly initiated in the Gold Arena. As you say the masses have been programmed to not accept gold. Many before me have laid siege to many a castle, but our numbers grow inspite of our setbacks. Those within the castle have fewer resources to draw upon, and in the end have to come out on the field of battle. When that time comes we will have to know the lay of the land, our enemys strenght, his ability to wage war. That my friend is what you will have in your portfolio. Diversity and the ability to adapt to the situation. So many refuse to even look at gold at this bargain price. Ten ounces, a poultry ten ounces, could make a difference in ones life. So we must shift our strategy from 100 to 10 ounces. Affordable, an introduction and many more may be inclined to join our ranks.


BlackjackSouth Africa gold production may drop as a result of strike#8630610/1/02; 02:07:14

JOHANNESBURG – South African mining groups will have the historically poor productivity of the December quarter compounded by a national strike which is expected to cost the broader South African economy R4.2 billion. The National Union of Mineworkers (NUM) today confirmed its 300,000 members would join the mass strike to protest against the government's privatisation policies, which will run on Tuesday and Wednesday.

Senzeni Zokwana, the president of the NUM, said the union leadership had called for its members to join the labour stay-away organised by the Congress of South African Trade Unions (Cosatu) and expected a high percentage heed the call. He said the union expected the production loss to be "very severe", but said labour had done no research to quantify the exact effects of the strike on the country's productivity.
Political instability in SA is a problem for SA miners.
Could lead to less gold supply coming to market.

BlackjackFrench consumers losing confidence#8630710/1/02; 02:15:32

Paris, Oct. 1 (Bloomberg) -- French consumer confidence declined to a five-month low in September as shoppers became more concerned they will lose their jobs.

``I am watching my money,'' said Isabelle Pinto, a 26-year- old Parisian marketing assistant. ``They could tell me any day that I am fired and there aren't many opportunities out there.''

A government index based on a survey of 2,000 households fell to minus 18 last month from minus 17 in July. No figure was published in August. Analysts had forecast a reading of minus 19.

Consumer spending accounts for more than half of Europe's third-largest economy and prevented France from following Germany into recession last year. With unemployment near a 22-month high, shoppers may pare purchases in coming months.

``Consumption won't hold up to power a rebound,'' said Caroline de Tinguy, an economist at Societe Generale SA in Paris. ``Morale is falling among consumers and producers alike.''

Consumer spending declined 0.1 percent in August. Faced with falling demand, executives are also becoming more pessimistic. Manufacturers' confidence fell to a six-month low in August and industrial production declined the most in nine months in July.

Alcatel SA said last month sales probably dropped 15 percent in the third quarter. Europe's biggest phone equipment maker has announced 70,000 job losses in the past 1 1/2 years. Cap Gemini SA is trimming as many as 5,500 jobs after the largest European computer-services company posted a loss in the first half.
No recovery here Mr O'Neill

BlackjackDefense Dept may stop payments to Boeing and General Dynamics#8630810/1/02; 02:28:02

WASHINGTON (Reuters) - Boeing Co. BA.N , looking beyond a government-imposed midnight deadline to make good on an alleged debt of more than $1 billion, accused the authorities on Monday of trying to "strong-arm" it into settling an 11-year-old dispute over the biggest weapons program ever canceled for alleged fraud.

Boeing's general counsel, Douglas Bain, said in a letter to his Navy counterpart, Thomas Kranz, that the government was squeezing the company unethically and unlawfully in "yet another attempt to knuckle us into settlement submission." The federal government has given Boeing and General Dynamics Corp. GD.N , another of its biggest defense contractors, until midnight Monday to pay up or work out a deal stemming from the 1991 collapse of the Navy's A-12 bomber program. As the deadline passed there was no sign any of the parties had budged from their positions in an unusual showdown between the government and two of its biggest contractors.

Unless payment is received or other arrangements are reached, the Defense Department will start withholding funds from payments due to the firms under other defense contracts, the Pentagon has said, speaking for the Navy, the Defense Department and the Justice Department.
When it rains it pours.

silvercollectorCorrection to my msg 86269#8630910/1/02; 04:30:20

"AG has 'held' for over a half-year now while the bond market lowers ST bonds and the CRB is screaming!!!!"

should read,

AG has 'held' for over a half-year now while the bond market lowers ST bond yields and the CRB is screaming!!!!

If the rise in commodities are a good leading indicator inflation may break out of the current range and nose up to the yield of a 10-year note (approx. 3.75%). Imagine the despair of bondholders that '10 years of promise' yields a 'realized' loss.

Thanks Boxman for the message about the FED 'dissention'. It would appear that at least 2 have their heads screwed on semi-straight, lower ST rates stimulating economy (in theory at least?) and lower the USD. Too bad the other 10 don't feel that way, I wonder what they are afraid of or more to the point what (or whom)are they trying to protect?

(hee, hee)

PizzNibelung - G-Khan#8631010/1/02; 07:28:14

Thank you both for the exchange last nite. Re-read the posts and thought my tone was a bit rough - my apologies.

I think a lot of people are getting just a bit frustrated and/or concerned, me being one of them.

Nibelung: Nation states do demise at varying rates. The Soviets collapsed rather quickly though too. I'm just not too happy with all the disinformation we're being fed. But then again, what choice do they have?

G-Khan: That's a bubble I'd like to see too, right along with some honest money and both the citizens and government living within our means - controlled and managed debt. I'm with you on silver, slightly tarnished right now, but will shine again soon.


Carl HTurkey Says Seized Substance Not Uranium#8631110/1/02; 07:55:08

ISTANBUL (Reuters) - Turkish scientists said on Tuesday the substance at the center of a nuclear weapons scare was not uranium and that the material seized in the south of the country posed no threat



Ok, first it is 33lbs of highly enriched uranium, then it is 5oz, now it is not even uranium.

All I can think to say is Got Gold?

BoxmanPort shutdown#8631210/1/02; 08:15:40

Snippet: A prolonged shutdown of West Coast ports could lead to empty store shelves, quiet factories and a global economic crisis, analysts say.

"The collateral damage is huge," said Stephen Cohen, a regional planning professor at the University of California at Berkeley. "We've never had anything like this. This affects the entire economy."

Snippet from another article in the Times (sorry, no link):
The union, whose members earn about $80,000 to more than $150,000
annually, has used those factors to its advantage, and shipping lines
claim they gave in to unreasonable demands in 1996 and 1999 after
cargo movement was slowed. This time, they said, they will not back

If this gets ugly, and the American consumer comes under any hardship what so ever, and these wages become public knowledge, I predict a backlash on the union.

PizzBoxman#8631310/01/02; 09:33:06

Heard the salary figure on a major radio station in Seattle this morning.

We need this out here like we need a small pox outbreak. We've already got the worst economy in the nation with Boeing and the problems. Now the port . . . hard to figure what's next.

The other side of the state is right in the middle of apple harvest with 35% of the crop due to be exported. The orchards have been in a recession for 10 years due to overcapacity and this will finish off the small growers and hurt the big ones pretty bad. Looks like the overcapacity problem's going to be solved the hard way.

Back lash on the union. That's a tough one. These boys are well heeled, tough, stubborn, and my sources say they can outlast the shippers. They don't strike or walk out on a whim, and have no love for the corporations. They'll even tell the government where to get off as soon as the crisis get's full blown IMO.

Could be a very cold winter. Just in time delivery for inventory control has spread company's ability to weather shocks very thin. It's also spread their capital way too thin, as money that used to be tied up in inventory has been put to other uses - and some of these uses were expansion. Just in time inventory advented with computers and global trade and helped fuel the 90's expansion. it could now well fuel a depression of the new millenium.


kasperjackChris Thompson Intimations#8631410/01/02; 10:36:08

Mining Veb Denver Today

Gold Fields [GFI] and World Gold Council chairman Chris Thompson wrapped things up with a
rebuke for the industry's stewardship of the metal. He's determined to reverse the rot, starting
with a WGC spring cleaning that will see some offices close and poorly performing programs
will be slashed.

He had no additional information on how the WGC intends to stimulate widespread investment
buying, but assured the audience that the organisation was working toward a "complete
First day of Burtons regime and the World Gold council Chairman defers the news...

kasperjackPension Numbers Call For Earnings Restatements#8631510/01/02; 10:53:33 Operating income of S&P 500 companies was
overstated by an average of 7.2
percent in 2001 as a result of assumed returns on
pension assets, according to
Morgan Stanley's analysis.

While pension assets reported a loss of 6.9 percent
for the S&P 500 in 2001,
expected rates of return used for accounting purposes
averaged 9.2 percent, so
reported net pension gains remained at high levels,
said the report.

With the S&P 500 down nearly 30 percent this year,
the situation now may be
much worse and will likely result in lower operating
income in 2003, said analysts.
Built in problems for the bottom lines are the soup de jour for corporate executives.

kasperjackThe Fly In The Ointment#8631610/01/02; 11:31:30

Iraq Claims On Oil Output Capacity
Exaggerated - Source
Tuesday October 1, 1:07 pm ET

LONDON -(Dow Jones)- Iraqi claims that its crude production capacity can quickly
reach 4 million barrels a day are widely exaggerated, an industry source familiar
with Iraq's oil infrastructure said Tuesday.
Iraq wants to sell us the bleeping oil. We refuse to purchase it on the grounds that they might rebuild their military machine. Ergo we have paid the boycott premium on our oil prices since the end of the last gulf war. Now all the war mongering is adding upwards of $5 more per barrel of oil. This works out to a Almost $400 million overpayment per day on oil prices. We are shooting ourselves in the foot. Why? Even the moronic politicos have the capacity to impose an enforceable restriction on Iraqs capacity to rebuild its military machine as part of any deal for them to increase their oil deliveries. We already have no fly zones and have successfully imposed sanctions on the Iraqi people for more almost 10 years. The politicians have kept the Iraqi situation in flux since the last war for reasons of their own. By going gung ho into the Mid East now we are going to entrench radical Islam. Our cure will be worse than our own current self inflicted dis ease. Maybe that is why the Europeans are not so eager to hop aboard our bombwagon huh?

Black BladePrecious Metals: Back From the Brink #8631710/01/02; 12:20:06


There is a growing gap between sentiment in the base & precious metals sectors. But stark differences exist among precious metals and their prospects for the coming months. Gold's price – supposedly fuelled by low US interest rates, a weakening US dollar, conflict in the Middle East and Kashmir, a reduction in producer hedging, official sector sales restraint, and an escalating crisis in the Japanese banking industry – has now seen the yellow metal at 3 year highs. And after a roller-coaster 2001, PGMs look more settled but exhibit contrasting fortunes. Guy Isherwood reports on current market thinking.

Gold's price rise is leading some analysts to predict that the metal will have to fall, particularly as speculators hold large long positions on futures markets, making it increasingly vulnerable to a short-term correction. Large speculators have recently been trimming their net long exposure to gold futures as evidenced by the latest (May) Commitment of Traders Report from the CFTC. Gold bulls have waited a long time to flex their muscles, and with sideways stock markets, political unrest and banking crises in the offing, are now increasingly calling the market significantly higher – even from these levels.

Calls for gold to reach the heady heights of the early 1980s seem tsunamic. Conversely, gold could go the way of silver as Central Bank sales escalate, gold is de-monetised, and if so, "... goes to $68/oz," – a favourite scenario cited my (Andy) Smith. Either way, and perversely as ever, we should all hope that gold will stabilise in months to come.

Black Blade: An "interesting" report. It pulls together a lot of info from the WGC and GFMS, as well as points out info from GATA to those gold bears who despise and apparently fear the role of gold such as Andy Smith of London-based precious metals Mitsui Global Precious Metals. The report also examine some precious metals market trends.

kasperjackLast thought On Iraq Post Gulf War Policy#8631810/01/02; 12:59:17

Big Oil Has Its Own Agenda

The politicios can not openly subsidize profitable American oil interests. However it appears they built in a profitable little scam into the Iraq oil embargo. It has made the oil companies billions of dollars over the past 10 years. The Iraq attack rhetoric is adding more profits to bottom line and bodes for even better profits if we go to wat to confiscate the oil fields. Bush and Cheney are oil people aren't they?
USAGOLD / Centennial Precious Metals, Inc.Did you know you can continue to receive NEWS & VIEWS?#8631910/01/02; 13:04:06

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"...we emerge to introduce a new role for NEWS & VIEWS -- sifting through the avalanche of information being published these days and organizing it into something reader-friendly for our busy clientele. We hope you enjoy and gain from this first issue of our resurrected now bimonthly offering. May you welcome it like the return of an old friend.

"Speaking of old friends, it seems our old friend, Mr. Yellow, has altered his disposition since last we met ­ stubborn determination has reaped dogged progress, and most of the goldmeisters have spent a pleasant summer counting coup. Overnight, it seems, gold has gone from contemptible wastrel in the investment world to prime subject matter at Power Lunches around the world -- including CNBC's segment."
- - -
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Black BladeHurricane Lili To Cut Through the Heart of Oil and Gas Guld Production#8632010/01/02; 13:12:47

Mass evacuations from oil and gas platforms in the Gulf are underway as Hurricane Lili is expected to become a catagory 3 storm by the time it hits. Already production has been curtailed from the last hurricane (Isidore) while oil inventories are falling to crtical levels ahead of winter drawdowns. Energy costs are certain to rise in coming weeks adding more pressure to the weakened economy. (Be sure to see link)

- Black Blade

(link provided by DeRonin)

USAGOLD / Centennial Precious Metals, Inc.The Fruit of Your Labor: Another day, another dollar?#8632110/01/02; 13:12:52

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TownCrierHEADLINE: Blair Says Euro Is a Part of U.K.'s Destiny#8632210/01/02; 13:37:48

Blackpool, England, Oct. 1 (Bloomberg) -- U.K. Prime Minister Tony Blair said the single European currency is part of the nation's destiny, even as opinion polls show a majority of voters oppose joining the euro.

Blair, speaking to a conference of the ruling Labour Party in Blackpool, northwest England, said that the decision on membership concerns more than economics, and suggested U.K. influence in the European Union is also at stake.

The remarks ``were stronger than we've heard from him before,'' said Mark Austin, chief currency strategist at HSBC Holdings Plc in London.

Only a campaign by leaders like Blair will reverse British voters' skepticism to the euro and make membership more likely, analysts say. By promising to ``go for it,'' Blair is answering the calls of pro-euro campaigners, including those in his own government and party.

``The single currency is a fact but will Europe find the courage for economic reform,'' Blair said. ``The way to get the right answers is by being in there, leading in Europe, not limping along behind.''

-------(see url for full text)-------

The political will is in support of the euro over the pound. Whatever the outcome, the U.S. dollar will not likely prosper in the middle gound.

Where the dollar cannot preserve a person's financial interests, there is gold at the ready. Are YOU ready?


Old YellerBush Doctrine,ANOTHER Step toward Imperial Overstretch#8632310/01/02; 13:50:20

"In the long run,any indebted country caught in an explosive debt trap dynamics-even the issuer of the the world's reserve currency-will prove to be an untenable borrower.At some point,foreign onvestor perceptions will change.At that point,the US will go from being the the issuer of the world's reserve currency to the world's greatest profligate.A quantum change in portfolio preferences will ensue.Because holdings of "reserve currency" will be so great at such a point,the requisite
portfolio adjustment and it's consequent real sector impact will be huge.Of course,there is no precedent to go by
for there has never been a reserve currency issuer that turns profligate.It is although gold would somehow become as plentiful as sand on the beach."

Shades of FOA,without the paper gold factor worked into the mix.When the many holders of the "barn deeds" present
their claims for redemption.The gold commitments probably ARE approaching sand on beach status,however,they are
spun from printing presses.

kasperjackBlair In Deflective Mode Euro Talk May Be Avoidance Tactic#8632410/01/02; 13:59:51,,2-432169,00.html October 01, 2002

Black day for Blair as party
By Philip Webster, Political Editor
Defeat on public finance: retreat on Iraq

TONY BLAIR suffered his
biggest setback at a
Labour conference since
becoming leader as he
was yesterday defeated
over the private financing
of public services and
faced mounting disquiet
over Iraq.

The Prime Minister will
stage a defiant fightback
today by telling his
uneasy party that Labour
has not been bold enough
in its reform programme
and that the pace of
change must be speeded
up rather than slowed.

But in some of the rowdiest conference scenes for
years the minister defending the controversial Private
Finance Initiative was slow-handclapped and booed
off the platform.The ritual humiliation for Paul
Boateng, the Chief Secretary to the Treasury,
preceded a heavy defeat for the leadership as the
unions voted for an independent inquiry into the
Private Finance Initiatives (PFI).
Some background on Blairs state of mind today. He may
as well have thrown the Euro issue onto the table.

Black BladeAfter Hours Gold Selling#8632510/01/02; 14:36:43

A rumor from a friend just came in that Morgan Stanley and JP Morgan Chase are selling down gold in after hours. Some will say say that it is "profit taking" while others will say it is "price manipulation". Anyway, we should keep our eyes and ears open as today's "dead cat bounce" on Wall Street was without merit and the fundamentals do not support a prolonged stock market rally. So far this has been quite "entertaining" as watch the frenzied lemmings running to and fro.

- Black Blade

kasperjackDow Vote For Peace And Gold Price Interest Rates And Contango#8632610/01/02; 14:38:05

Great Opening For Lassonde And Murdy To Roil The Gold Industry Tomorrow Huh??

The Dow Vote for peace is a slap in the face for Junior. It should
push the war agenda back until at least
January. In the meantime the world pays
upwards of $400 million a day extra for
oil. The Bush Middle East policy is
rapidly becoming an impediment to the
prospects of the world economy. The Dow Peace Initiative will impact the price of gold. It must also be analyzed in relationship with the impending rumors of interest rate reduction and its effect on Contango.
Thus far the gold price is holding relatively steady. The cabal can still put
the boots to the gold price. However they must be considering whether a
significant drop in the gold price is going to initiate a mad rush to close
down underwater gold hedges. With interest rate expected to decline by as
much as a half point Contango would also decrease. Ergo the future prices of
gold would also be set to decline. Another factor that might lead to the
closure of the underwater hedge books..... The cabals decision on what to
do with the price of gold will tell us plenty about their fears and

BoilermakerDJI up 346 on Bad News#8632710/01/02; 14:41:05

I wonder who was buying stocks today? Gotta think that whoever it was is trying to create a double bottom buy signal. Probably your 401K and tax dollars at work. Buying stock can be fun when its not your money at risk.

That (third party money management) is one of the main differences from the market of today and those of the 1930's. People are still feeling somewhat secure in the knowledge that their money is being handled by "professionals". No matter that the professionals are looking out for #1 and many are hustlers and crooks.

Oh well, maybe we'll learn enough this time to keep another SM bubble from happening for about two or three generations. Hopefully their will be a "natural selection" that rewards common sense and honesty.

Sour grapes courtesy of Boilermaker whose gold stock portfolio took a 5% hit today.

Sierra MadreVolatility: a concept that only applies to gold?#8632810/01/02; 14:45:40

I remember was despised as "excessively volatile", the kiss of death to own, according to its detractors.

Today we see the venerable Dow Jones Industrial Index up 4%+ and I don't hear anyone remarking its "excessive volatility".

The DJI index has had some wild swings recently, this is only the latest, today's.

What's sauce for the goose is sauce for the gander, I suppose that owning the DJI index companies is the "kiss of death", today. Suppose gold were to go up $12-$15 bucks in one day, fall the same or more the next...but we aren't seeing that. We see $2-$3 dollar moves, equal to 1% or less.
Plus, a consistent rising trend.

So, who's volatile now?


USAGOLD / Centennial Precious Metals, Inc.Wall Street up today?? It takes more than a single day in the markets to make a trend.#8632910/01/02; 15:22:34


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R PowellBubbles // Boilermaker // G-khan#8633010/01/02; 15:23:15

I noticed your hope that we've learned enough this time around to avoid another SM bubble for two or three generations. May I ask if you have children?

I quess every generation has to learn for itself. My kids sure did! There have been some lessons in this life that I've relearned many times. There will be more bubbles but maybe the next one won't involve equities.

G-khan made a wish yesterday (86285), "I would like to see Gold and Silver become bubbles." Whether this may prove to be a good or not-so-good event, I believe it will happen so I'll plan accordingly. I do hope the good wish fairy was listening when the Khan wished. Bubbles are produced from human psychology, perhaps the objects of the bubbles vary according to current fancy. Maybe after stocks and precious metals, we could pick an exotic flower again.

mikal@kasperjack#8633110/01/02; 15:26:33

Your last post intimated that gold prices were being supported by two dissappearing influences: 1) small contango for gold carry trade ....So, now that interest rates are coming down again, the spread with lease rates declines, dampening leasing activity further, but you say this is BAD for gold 2) Iraq war postponed, so gold holders will SELL. No other reason to hold, so gold PLUMMETTS even further?
TownCrierAnalyst Howard Simoms roughs up silver (and himself) a bit#8633210/01/02; 15:55:43

In an article today he writes:

"This past January, I suggested buying silver-related equities on prospects of a weaker dollar and (oops!) the economic recovery increasing industrial silver demand. Another reason, illustrated below, is that real silver prices are no higher today than they were in the Kennedy administration.

"Real silver prices haven't been below $3 an ounce since Camelot, so going long at the then-prevailing price of $3.29 in 1983 dollars seemed like a good idea, and in a pure sense it was. The price is now $3.42 in 1983 dollars.

"Too bad we have to trade in 2002 dollars.

"In addition, silver has a strong gold market going for it: ...Gold prices have risen close to 15% in 2002 in response to low short-term interest rates and the weakening dollar.

"Copper is even more significant for silver than gold is. This sensitive coincident indicator of global economic activity just hit a nine-month low. Most silver is produced in association with either copper or lead and zinc. As copper production falls, silver production falls, and that should support silver prices. However, the weak economic conditions depressing copper prices also are depressing silver prices.

"Stealing a phrase from duly anointed bond king Bill Gross, who proclaimed recently that "stocks stink," allow me to chip in that silver stinks. Can we complete the syllogism? Stocks stink and silver stinks, so silver stocks must stink? No, but they need to shower more frequently than most.

"Silver stocks don't have the distinct relationship to silver that we should expect from commodity-linked equities. If we compare the Hong Kong and Shanghai silver index with the Dow Jones World Index over the past decade, we can't find any incremental relationship between the silver miners' performance and the price of silver itself."
Simmons says he doesn't now foresee much in the way of an economic recovery, and thus until he sees the Fed's monetary policy move to become more accommodative he would not expect much upside. One of the things that he sites as negative for silver is its holding costs. In quantity, that's true enough, and it remains a prime area of efficiency offered by gold -- ounce-for-ounce and dollar-for-dollar.

kasperjack(No Subject)#8633310/01/02; 16:06:42

mikal (10/01/02; 15:26:33MT - msg#: 86331)
"Your last post intimated that gold prices were being supported by two dissappearing influences: 1)
small contango for gold carry trade ....So, now that interest rates are coming down again, the
spread with lease rates declines, dampening leasing activity further, but you say this is BAD for
gold 2) Iraq war postponed, so gold holders will SELL. No other reason to hold, so gold
PLUMMETTS even further?" -Mikal

Naw Naw naw I said

"With interest rate expected to decline by as
much as a half point Contango would also decrease. Ergo the future prices of
gold would also be set to decline. Another factor that might lead to the
closure of the underwater hedge books....."

----- mining companies close out underwater hedge books. If the futures price declines as a result of a decline in interest rates(contango effect) the gold miners might find it cheaper to close down their underwater hedges..Closing down UP to 80 million ounces of underwater hedges would drive the gold price higher! I added that to an inference that a major cabal tanking of the gold price might precipitate a stampede to buy back the underwater gold hedges-As per Lassonde Diggers and Dealers conference statement.

---- I was talking about how the gold cabal would use todays Dow Vote for Peace in the Mid East as an excuse to tank the gold price. I was wondering about the state of fear in the gold cabals camp. The fear that if they trash the price of gold too much. THAT MIGHT PRECIPITATE A CLOSURE OF THE GOLD MINERS UNDERWATER HEDGE BOOKS. My interest lies in interpreting both the extent of the gold cabals resolve and the extent of their fear of precipitating a gold miners stampede to close out their underwater hedges. Lassonde and Murdy were captioned in the link section for cause....

---- I agree on the small contango affecting the gold carry trade. The bullion banks or counterparties will have trouble short selling the gold received from the miners at a profit. They would likely find it cheaper to return the gold to the central banks and sell paper on the market instead.

TownCrierHEADLINE: 'Four digit gold price in 5-10 years' - Hathaway#8633410/01/02; 16:16:24

Noteworthy excerpts from this Miningweb article which you've probably already seen:

Tocqueville Asset Management's John Hathaway was on hand to remind everyone why liquidation [of gold], especially into dollars, might be foolish.

Reprising many of his previous commentaries, Hathaway said: "Having suppressed the normal functioning of capital markets over the last two decades, the Federal Reserve and economic policy makers have set the stage for a protracted period of sub-par investment returns." Consequently, he believes there will be an inflection point involving a mass emotional and psychological shift toward gold; principally because of dissatisfaction with existing returns and a fear for the future.

Hathaway is also watching the share prices of the "money center banks", alias JP Morgan, the trade weighted dollar, the housing GSEs, mortgage insurer share prices and the slope of the yield curve. All told, he's looking for shudders along the spine of a zombie political economy.

That four digit gold price? He thinks we'll see it when the Dow Jones Industrial average and price of gold cross over once more. The Dow at 5,000 isn't likely to trigger the golden stampede (after all we're going to see Nasdaq wend its way below 1,000 points), but 1,500 points on the big industrial board may yet do the trick. Ouch; unless you've allocated some of your portfolio to gold.

...A hedge fund manager I spoke to on the sidelines of the event agreed that acceptance of gold in the "traditional" community was slow, but warned not to be misled by the pedestrian pace. He said he had seen a vastly increased level of interest from sectors that would not previously have touched gold with a barge pole. "This takes time to work though the committees, but it is happening," was his encouragement.

Graham Birch [Merrill Lynch] reinforced that with a graph showing his cumulative money flow which turned up strongly late last year and has powered past the May peak even though the gold price is only just working its way back up to those levels. Most importantly, the money coming in is "sticking", rather than flying out at every hint of a retracement.

Birch also worries about the institutional obstacles for gold, primarily in terms of entrenched investment cultures that have to be overturned. But he sees it taking place, just as the hedge fund manager does, and the bottom line is an incipient increase in gold's investment relevance.

-----(click url in case you missed this one)------

The case for gold coninues to build -- brick by brick.

BoilermakerRich Question 86330#8633510/01/02; 16:22:36

Rich, I've got 6 kids ages 16 to 39 plus grandkids. They know that I'm a goldbug and hard money guy. Last Christmas the kids each got a gold eagle. This Christmas will be the same and the grandkids will each get one of our host's silver eagle sets. Hope this gets my point across so they aren't caught up in the next folly.
R PowellGovernment silver buying, not a rumor!#8633610/01/02; 16:56:54

Recently Gold-Eagle has included articles by Philip Gotthelf who is a commodity analyst and a regular in "Consensus" newspaper. He has just recently changed his attitude towards gold to upbeat while still probably neutral at best towards silver. I just read his latest metals' offering and sent him my opinion on his doubts concerning the government's future silver purchases. Thought I include it here FWIW.

Good morning Mr. Gotthelf,
I have read your articles for years and have noticed your recent change in outlook for both gold and silver. I was surprised to see articles being featured at Gold-Eagle but I am more interested in silver than gold and, in this regard, may have some information for you. (please also note for metals news and views).
From your Consensus article, " A news story recently circulated that stated the U. S. Treasury was out of silver. It had depleted 700 million ounces in coin sales and President Bush was seeking Congressional approval to allow Uncle Sam to purchase silver on the open market. If such were true, I doubt silver would have declined below the moving averages to bust its handsome channel."

The legislation was enacted by congressmen from Idaho, passed through both houses of congress and was signed by the President. The President signed the bill into law but had no initiative in its enactment. The market took no notice, the signing occured while silver was declining from over $5.00 to its recent lows around $4.40-4.50. The Treasury can not purchase until Jan. 1, 2002 but the Sunshine Mint Co. (not to be confused with the "Mint") is rumored to have begun accumulating silver as they supply the silver rounds for Mint's Silver Eagle coin program. Of note also is the single record sale of 1,745,000 coins in August. The coin program does not use a great deal of silver compared to yearly usage ( 830.2 million ounces in 2001 according to GFMS Silver Survey 2002) but a 10 million ounce government purchase is significant when compared to remaining above ground available for delivery silver! What you report as unconfirmed is indeed true.
I, like you, had thought that Bush's signing of the silver purchase bill would move the market but, once again, the silver market has demonstrated that the price is in no way moved by any fundamental information (supply and demand) and may not be until there is a severe shortage. What commodity can you name that has run in a supply/demand deficit for 12 years straight without any price rationing?? Very few, repeat very few (big noteable exception is Warren Buffett) have considered that the surplus of silver (that has existed longer than there have been markets for silver) might ever run out. Unthinkable? Well, Uncle Sam is out, and will now become a buyer for the first time since ....??
I hope this information is helpful. I have read your "Consensus" articles for years. I look forward to them.
Rich Powell

This guy is imho one of the best using technical, fundamental and seasonal data. From what I read every week concerning commodity news, I am still convinced that there are damn few who know any of the fundamentals of gold or silver. If not for this forum and a few similar to us, then one well attended precious metals convention might include most of the world's bugs. The unknown always has the potential for an explosive reaction. Maybe G-khan's bubble??

BoilermakerHousing Bubble?#8633710/01/02; 17:01:20

Pizz, you make a valid argument that housing is not a bubble. Probably just a bulge like my body is prone to. Yes, real estate doesn't just disappear like paper even though it may be overpriced. In fact I've got a lot invested in farm and timber land that gives me great pleasure. Even owning gold can't compare to walking/riding ones own fields and woods.

Speaking of bulges, I've come up with an alternative to Black Blade's food storage plan. It's modeled after the bear's pre-hibernation regimen. Eat now, sleep later.

Americans' apetite for large homes is largely a function of mortgage interest tax deductions, low interest rates and low down payments. This is investment that competes with investment in productive business and forces those businesses into greater debt vs. equity. It may be a primary cause of the deindustrialization and deteriorating infrastructure of the US. This creates a need to import more and more of what we consume. The strong dollar has hidden the seriousness of this problem.

I just heard on the local news that another small steel company in NE Ohio is shutting down. More product to be sourced offshore. The dollar will get toasted soon.

mikal@kasperjack#8633810/01/02; 17:02:50

Your rudeness and arrogance are pathetic.
R PowellBoilermaker#8633910/01/02; 17:11:08

I like your Christmas presents idea. I'd mention that the complete set of silver Eagles from 1986 to present costs less than one ounce of gold now but may be valued in dollar terms much higher than gold in our lifetimes but, I'd better not make any gold/silver comparisons. Such comparisons tend to start food fights.
Concerning the gifts, have you ever read "The Good Earth"? Hopefully, those receiving them will treasure them. I'll wager that giving them gives you great satisfaction. I also do the same with silver coins just to try to instigate some awareness or curiousity among my kids of what the old man is thinking about. However, probably a lost cause, they have already judged me as nuts.

Another reason for USAGOLD! Thanks for listening to this old fruitcake, no one else will!

GoldnSilver2002just another bear market rally!#8634010/01/02; 18:30:56

Well considering everything gold held ok but ya one of stocks got hit for 10 percent!Top that one.It would seem gold is trading in an ever tighter range supported by the fact if it drops too low too many are their now to buy it cheap.This looks like an all out attempt to fly in the face of every fundamental as if to say,you see no matter how bad things get you need your money in the dow.Many will use this rally to finally unwind,others will get trapped.Amazing really war'strikes,bad economics,fraud,bad dollar management,argentina,brazil,japan,turkey,terorism'sept 11 th,record debt,record bankrupcies,no savings and we are running a huge deficit.All this and gold hoovers at 320 and the dow soars.I must be living in the blizzard of oz,i guess the fed is gonna buy the whole stock market and when everyone jumps in,they pull out.Sooner or later some major entity is going to catch on to this game,and they will use it to buy whats left of the worlds physical gold.IM not buying this rally and im holding my stocks.KInda sucks to hear about silver though.Is silver done or what?
kasperjackForbes On Antihedging Movement#8634110/01/02; 18:40:02

Gold companies turning against hedging
Reuters, 10.01.02, 6:57 PM ET

By Judith Crosson

DENVER, Oct 1 (Reuters) - Hedging,
a standard tool of financial
management aimed at locking in a
profit if prices fall, is almost a dirty
word for major gold producers now
that prices for the precious metal are
close to three-year highs.

"We don't do it. We don't believe in
it," Meridian Gold Group (nyse: MDG
- news - people) President and Chief
Executive Officer Brian Kennedy said
on Tuesday at the Denver Gold
Group's Mining Investment Forum.

Companies like Denver-based
Newmont Corp. (nyse: NEM - news -
people) have been on record for years
saying that investors who want a
pure gold play should buy its stock,
but now other companies have seen
how a hedge position can put a cap
on profits.

"We've taken the no-hedge pledge,"
Glamis Gold (nyse: GlG - news -
people) Chief Executive Officer Kevin
McArthur told the conference.

Even silver producer Coeur d'Alene Mines Corp. (nyse: CDE - news
- people) Chairman and Chief
Executive Dennis Wheeler told the conference on Monday the
company does not hedge.
Sorry you misinterpreted my original post.
Rudy Kasperjack

Nibelungpizz#8634210/01/02; 18:53:07

Saw your post from this morning....for what it's worth, I'll generally prefer a direct and lively discussion over a polite and constrained discussion !!!(within reasonable limits of course, ha ha)
kasperjackEurope The Euro Iraq And Americas Mid East Adventurism#8634310/01/02; 19:00:59

If junior doesn't get his war he will probably self destruct. Europe is his
main opposition on Iraq. They don't see what's in it for them to support the
Bush initiative. Hell the Arabs are running a trade boycott against us.
Trade($65 billion) is down by up to 25% with the Arab world. It would
probably be down more if weapons systems were not in the pipeline. Europe
is getting a good chunk of that business. Europe wants to make a deal with
the Arabs to transition to the Euro for oil pricing. Europe is also more
dependent on Mid East oil than we are. They don't really want to pay the
costs in higher oil prices and instability emanating from a new American
proprietorship in the Mid East. Some of the paranoid might understand an
American initiative in Iraq to be an end run assault on the growth of
Euroland. Russia and China are relative small fry in the Mid East equation.
It is Europe which has the most to lose... It is Germany that compared
Bush's tactics to Hitler. It is France which dropped the bombshell of the
Euro as a reserve currency. National self interest is in play here...

kasperjackMining Veb Denver Conference#8634410/01/02; 19:33:16

Past Future
Wednesday, 2 October 2002
IN DEPTH: Bobby Godsell, CE, AngloGold
'We will surprise the market with our growth capabilities at a time when some of
our competitors will be battling to live up to their expectations.'

IN DEPTH: Randall Oliphant, President and CE, Barrick Gold
'As for the gold price, we are seeing strengthening fundamentals. While
investment demand is rising, supply is on the decline, reflecting a fall-off in
exploration spending and declining production. As a result, we are positive on
the gold price.'
Is Bobby trying to dodge his hedge book dilemma with a growth agenda. The definition of short term hedge book can throw a new light on Anglo Golds and Newmonts capacity to close out their underwater hedge books. You would be surprised at the advantage Anglo and Nem have over the likes of Placer and Barrick. The first yardbird to scoop up the loose gold on the table is in the cat seat Mr. Chapman sir... Roody kasperjack

sectorJapan's insurers: the next crisis?#8634510/01/02; 19:48:54

Ken Belson NYT
Tuesday, October 1, 2002

As Japan fumbles for ways to stabilize its wobbly banks, another potentially destabilizing crisis is brewing in its life insurance industry - the world's largest - also hurt by the weak stock market, record-low interest rates and the sour economy.
Like the banks, the insurers hold huge amounts of stocks and bonds, and the collapse of one or more of them - something analysts say is a distinct possibility - could further rattle jittery investors. The potential for such a meltdown has risen as stock prices have fallen to near 19-year lows and left most insurers with losses in their portfolios.
Moreover, in Japan's tangled financial industry, the balance sheets of the life insurers and banks are so intertwined that failures in one area could easily spread to another. The banks, for instance, are large buyers of the insurers' subordinated loans, and the life insurers are the largest shareholders of the banks.

A folding life insurance giant would be a very big thing since a large portion of pension payments are from 5% earnings from insurance company annuities.

Perhaps such a failure will be the last straw for the already sinking Japanese economy?

kasperjackThe Bunk And Bobby Show thoughts on New World Gold council Initiative#8634610/01/02; 19:54:53

Miing Veb

Bobby Godsell

MINEWEB: Vast sums have been poured into gold
marketing with questionable results. Is there
any reason to believe that the "new" World Gold
Council and an increased budget are
capable of doing any better than, say, spending that
money to buy ounces at source and
horde them?

BOBBY GODSELL: I have great confidence in the
leadership of the World Gold Council. It
also now has a broader base amongst producers. I
expect great things of it. The marketing
challenge remains. We have to do smart things with
perhaps less than we'd like to spend in this
area. Our own approach has been to be fully
supportive of collective efforts, and to break new
ground on our own, where our marketing efforts are
directly tied to commercial gain for


MINEWEB: Vast sums have been poured into gold
marketing with questionable results. Is there
any reason to believe that the "new" World Gold
Council and an increased budget are
capable of doing any better than, say, spending that
money to buy ounces at source and
horde them?

RANDALL OLIPHANT: We need to create more
off-take in gold, but hoarding is not a long-term
solution to the challenge. As well, the argument you
raise could really be directed at any
company or industry with a product to market and an
advertising budget. It's like saying to
Coke: Take your advertising money and buy the
bottles off the shelf yourself. The question
ignores the power of modern marketing and the mass

The way to drive demand is through the Jewelry
Marketing Initiative (JMI). It has focused goals
and measurable results. For example, we are running
pilot projects to test the effect of
marketing to ensure we get value for our marketing
Hedge book speak. Big hedge book holders see no benefit to Chris Thompsons forthcoming initiatives. Jewelery is the ting... Rudey

BlackjackBritish Insurers face Insolvency#8634710/01/02; 21:30:33,3604,802794,00.html

The financial services authority yesterday attempted to calm mounting fears that insurers face insolvency from further stock market falls. At the same
time the City regulator warned that the industry was not doing enough to manage its business soundly.

After on-site visits to big insurance companies, the FSA found six areas of weaknesses in their internal controls and urged the firms it had not yet visited to take "remedial action" to avoid similar failings.

As it published a progress report on a new regulatory regime for the troubled industry, the FSA insisted that big life insurance companies had "significant ability to withstand further large falls in equity values" from a level of 4,000 on the FTSE 100 index.
"It is our intention to reform the calculation and reporting of solvency margin requirements, including making the prudential margins more transparent," Mr Tiner said.

His reassuring comments about the financial strength of insurers yesterday bolstered the share prices of the leading players. Prudential rose 18.5p to 355.5p while Aviva gained 15.5p to 369.5p.

His remarks follow fresh concerns about Equitable Life and moves by many insurers, such as Standard Life, to cut payments on policies to preserve their financial strength. Other companies, such as Legal & General, have tapped their shareholders for new cash to boost their financial position.

Mr Tiner said his view was based on the responses of the biggest life insurance companies to questions about their ability to withstand further falls in the market.

Even so, one senior industry source warned that because the FTSE 100 was at higher levels when the survey was conducted, this might present an outdated picture of the insurance industry's position.
Short covering rally today. Economic news is grim.
If the Fed has to cut again soon it will be good for PMs.

Gandalf the WhiteThe HAPPY BIRTHDAY ESSAY CONTEST WINNERS !!!!#8634810/01/02; 22:52:18

Hear ye! Hear ye! Gather around the TABLEROUND, Good Ladies and Knights, for the WINNERS of the **** Happy Birthday O' Mighty Oaken Table of Yore **** Contest have FINALLY been selected !

Behold! The Master of the Castle, SIR MK, has ordered that these precious metals be brought up from the guarded depths of the Castle's rich vaults, a treasury maintained to meet the needs of all who come to these doors looking for a better way through life. Stir up the fire someone, and let us have more light! Look upon this TABLEROUND, and you will see the rewards awaiting their bestowment upon those who earned them with stirring essays. Words that remind us of our good fortune had through the companionship of all persons that meet in this place, for without all those that gather here, this "place" would remain little more than a dark and misty undefined space among the "webpages" of the Internet. In this location, barren throughout the ages, our good host raised a flag pole four years ago, and it is you, Good Ladies and Knights, who have labored hard to raise the ramparts of this edifice.

I, Gandalf the White have been asked to deliver this information on behalf of the Master of the Castle, SIR MK, though he insists he feels himself to be nothing more than the honored owner of our "home". (BUT, we all know better !) <;-)

The WINNING prize is an one ounce PURE GOLD Austrian Philharmonic. The runners-up (two were chosen) will each receive a Queen Victoria British GOLDEN sovereign (which carries some scarcity value) -- a representative of the old world, when gold was the primary form of international settlement. As always the prizes will go to those who best wove an answer to the "Question", in their own words, into their narrative. That was essential. The "Question" was: "Why is that I find this Mighty Oaken Table of Yore so important? Why do I keep coming back?"

After many hours of the Judges reviewing and having heated discussions of the greatness of each of the thirty-three entries, these WINNERS were chosen.

AND NOW the Trumpets ---

The Grand Prize of an one ounce PURE GOLD Austrian Philharmonic is awarded to the smoothly worded entry from Sir Sundeck , who inspired all with words that rang with truth and hope.

Sundeck (9/25/02; 01:27:43MT - msg#: 85897)
****Happy Birthday O' Mighty Oaken Table of Yore****
So...why do I keep returning to this exalted place? Why do I return - to lurk in the background and watch and listen as the knights and ladies discuss the woes of the world...and long for the day when gold shall again be king?

Mine is an abiding presence - although few who sit so confidently around the oak, and who talk with knowledge and wit while drumming their fingers upon the weathered grain, would recognize my countenance and voice among the assembled guests.

But I have learned much by my presence.

Next, there is the hearty discussion and the clash of intellectual rivals. Many times have I flinched as gauntlets were flung so heavily upon the table as to shake the silverware, and I felt within me that a considered response from the company was unlikely. But where the subject of gold is concerned the forum is replete with knowledge and wise counsel. No small matter in itself when one considers the complex role of gold and how it touches all things. So...interpretation and explanation of current and past events, and their bearing on gold, is another reason for my attendance.


The FIRST Runner-up Prize of a Queen Victoria British GOLDEN sovereign is awarded to Sir Boilermaker, who spoke from his heart.

Boilermaker (09/24/02; 06:47:40MT - msg#: 85818)
***** Happy Birthday O'Mighty Oaken Table of Yore *****
This is the site that I visit each morning at 5:30 and several times a day. I attend the Oaken Table at the Castle every day because my future and the future of my family depends on it. The many excellent minds that post here give me news and insights into gold and other investments. The larger picture of clashing cultures and international financial intrigue is woven through the messages. The archive of Another's and FOA's thoughts is a valuable interpretation of the global dance that connects fiat money, oil and gold. The forum's storytellers and poets add some enjoyable reading and I even enjoy the little squabbles that erupt when someone's ego, religion, politics or point of view is challenged.

The Second Runner-up Prize of a Queen Victoria British GOLDEN sovereign is awarded to Lady Waverider, who charmed us with poetry setting forth NUMEROUS reasons why she returns to the TABLEROUND !

Waverider (9/24/02; 00:37:14MT - msg#: 85799)
***** Happy Birthday O'Mighty Oaken Table of Yore *****
The FINAL REASON for returning to this TABLE of YORE,
For it's HERE we've become GOLD SISTERS and BROTHERS!

AND LAST, but NOT LEAST, the Judges have also awarded a "Honorable Mention" PRIZE of an one-ounce Canadian Silver Maple Leaf to Sir Slingshot for his entertaining and prophetic "unfinished" saga of "Siege Engine".

The Castle's Master, SIR MK, wishes me to remind of his words from the contest: ---BONUS for First Time Contest Posters !! "All first time CONTEST posters are WINNERS also, and will receive an one-ounce Canadian Silver Maple Leaf. But, you must e-mail us that you are a first-time Contest poster."

ALL WINNERS are to advise Marie via email at This email address is being protected from spambots. You need JavaScript enabled to view it. of their REAL name, Forum posting "handle", and their snailmail mailing address for sending out the PRIZES !!

And NOW, with this administration complete, all that remains is for me to "THANK ALL OF THE 33 ENTRANTS" for making this "FOURTH YEAR HAPPY BIRTHDAY ESSAY CONTEST" something truly remarkable.

BelgianFinancial Panic#8634910/01/02; 22:58:03

Whether it is Welteke or the Boj or the major Dow swings (ESF) all comes down to "evidenced", Financial Panic. The trap of *over-valuation* with no improvement in sight. Institutions who try to pull themselves out of the morasses, by buying more of the overvaluated stuff and tell the world they are not going to sink into the swamps. What an irresponsible attitude. Trying to win some more time is not going to work because the avalanches of problems are and remain "systemic". An ideal environment for Gold's advocacy on its fundamentals.

In my small, little, world...Gold is catching more and more serious attention. More and more people do talk about Gold and, remarkably, in another, less speculative, way !
Financial damage, already done, is beyond repair of confidence and the first signs to look out for a serious Golden alternative is manifesting.

On CNBC-Europ, the word "bubble" has been used frequently and without reserve, these days. If today's formidable "up", will fade out again (yes, it will)...another nail in the financial coffin, will be the result. The great unwinding is in full progress.
This globe cannot afford, itself, the luxuary of an oil war and its consequences. That's why, clown Tony's twists, are so amusing. Blair is "in the middle" of the dollar/pound/euro/oil/gold/bubble, turbulence. His labor-speech was an embroglio of contradictions with pathetic avoidance of realities. Half truths, half lies !

Expect soon some UN funding (bureaucratic bribing) difficulties, again ! A dangerous, polarizing, world on its way to serious changes in directional moves. Big global moves, this time !

Zero interest rates, crashing stock valuations, competing depreciating currencies and long war-threats, within a contracting economy from saturation, are not an happy hour atmosphere, here to stay. Ideal for some more Gold talk.

Black BladeFundamentals & Perceptions – Puplava#8635010/01/02; 23:01:21


Markets move in the short-term on news and perceptions. A news story or perceived beliefs about the economy and earnings can determine the direction of the market over shorter periods of time. Over longer periods of time, fundamentals determine prices. Fundamentals are the building blocks for markets and determine primary trends. Are we in a bear market or has a new bull market emerged? The bulls would argue that a bear market bottom is in and a new bull market is upon us. I couldn't disagree more with today's complacent and slumbering bull market consensus. We have only gone through the first stages of a Bear Market and we aren't anywhere near a bottom as many on Wall Street would have you believe. All we have done so far is get rid of the froth. This bear market has been unique in that it was never fully acknowledged by Wall Street, nor has the individual investor capitulated. Most investors remain fully invested hoping a new bull market will bail them out of their losses. Wall Street is still dealing with denial, pro forma numbers and other self-delusions.

We are still in a Bear Market that has yet to play itself out. At a bear market bottom, all of the excesses from the previous era or boom are cleansed from the system. Debt is defaulted and repaid, savings and balance sheets are fortified and repaired, and the stage is set for renewal. It is this cleansing process that sets the stage for recovery and it is still missing in this bear market. Instead of cleansing the economic system and financial markets of all of the excesses of the previous era, we have gone in the opposite direction, weakening it through additional excesses created by unrestrained credit. Whereas before we had a stock market bubble, we now have multiple bubbles that have yet to deflate.

Black Blade: I have to agree. The rally today was a short "relief rally" spurred on by short covering. There was a noticeable absence of any news worthy of triggering a rally based on a newfound cause to be overly bullish. If anything, the pre announced earnings warnings have actually increased quarter over quarter. This is "grim" news indeed. Now we have another element of the "perfect storm" approaching – declining oil inventories, just when a string of hurricanes are hitting the Gulf of Mexico production and refining areas while the U.S. plots war against Iraq. "Interesting Times"

steadycontest#8635110/01/02; 23:03:05

wow! what a great job juding and congradulations to those who won!
BlackjackWorlds Largest Bank : Mizuho drops 2.6%#8635210/01/02; 23:27:10

Three major banks were the most active stocks by value. Mizuho, the world's largest bank by assets, dropped 7,000 yen, or 2.6 percent, to 259,000. UFJ Holdings Inc., Japan's No. 4 lender, shed 9,000 yen, or 3.2 percent, to 275,000. Sumitomo Mitsui Banking Corp., the world's fourth-largest lender, was unchanged at 646 yen after rising as much as 1.9 percent earlier.

Banks fell after Mitsubishi Tokyo Financial, yesterday after the market close, reversed its profit forecast to a loss. It was the first Japanese lender to announce that it will fail to meet earnings forecast because of the value of its shareholdings declined.

``Mitsubishi Tokyo is the bank that's probably (done its accounting) most accurately in recent years, and if they are operating a loss, I'm pretty confident that probably means everybody is,'' said Scott McGlashan, who manages $125 million in global equities at Jade Absolute Fund Managers in London. He bought shares of Sumitomo Trust & Banking Co. earlier this week.

Japan's seven biggest lenders will have a combined unrealized loss of about 3.7 trillion yen ($13.8 billion) on stockholdings for the first half, almost triple their loss at the end of March, according to Bloomberg calculations.
More grim news coming from Japanese Banking.
Stockholdings hurting Banks and Insurers.

steadythe way out.#8635310/01/02; 23:28:44

Oct 2002


2002 Charles Savoie

If what we have are facts and truth in the letter by Michael Gorham of the CFTC (July 27, 2002), denying any problem exists in the silver market, and the rebuttals of Butler by Neal Wolkoff of NYMEX/COMEX, again, with Wolkoff denying a manipulation exists or has existed, then what the public may expect to encounter in the times ahead, regarding silver, is normal activity---no huge leaps in the price to prove a shortage and crisis, and no derivative meltdown. No rule changes should even be proposed in silver futures, and no defaults should transpire. No longs should be denied delivery. I allow for a 1 in 7 billion chance the Butler view is wrong---like finding the one man on earth who stands 20 feet tall without stilts! Furthermore, the assertions of Gorham and Wolkoff, who carried on as if the shorts are a bunch of choir boys, remain posted on the internet for future reference by a concerned public---by veterans organizations concerned about national defense (and the role silver plays in this), by their enlisted military counterparts and their relatives and friends, and by Congress, where silver hearings will once again be forced to take place. They will have to give account for what they said when events prove them wrong. These are buccaneers who can take a left hand glove and turn it inside out to make it match up with a right hand, though in a very illegitimate manner---they did that with words! It makes you wonder how insects could grow so large! We didn't see them deny we're now in the 13th consecutive year of a deficit, and for the price to never rise under such conditions defies all laws of economics! They didn't address the issue that a continuing deficit must end in shortages! It should be indisputable that Gorham and Wolkoff are in a position to absolutely know the true state of silver supply and demand. So, given this position, if a severe silver shortage manifests in the marketplace soon, with defaults, and many users unable to get metal, then Gorham and Wolkoff, it must be concluded, were falsifying in their recorded statements on silver; or they were incompetent, which is most unlikely. Either way, they would be like the bug that crashed into your hot automobile radiator, squirming as it dies. They should be assumed to have a plan to avoid being seen as liars or incompetents. Blaming junior executives at trading desks won't fly. The manipulation has gone on for many years and the board of directors of bullion banks and those they function for are responsible. Butler's request on September 10, 2002 to Wolkoff for the shorts to prove they have 330 to 350 million physical silver ounces (separate from COMEX) to back their positions was eminently reasonable. It was a put-up or shut-up challenge, but it will not be fulfilled! Like the would-be intimidator I knew at work who tried to psych me with bravado when I challenged him to arm-wrestle me ("I'm too strong for you, remember that!") When it came down to locking up with me and doing it, he walked off (or should I say, he "WOLKOFFED?")


So, when the silver hurricane strikes the COMEX, proving there indeed was a problem in the silver market---a problem of long years standing---what will Wolkoff and Gorham say? That they had to tell some lies earlier in the year to stall off their slide into quicksand? My intuition is at work now---consider what I'm about to suggest. This is all so appropriate since this is Halloween month---a time for spooks, ghouls, fairies, vampires, ogres, banshees, specters, goblins, demons, phantoms, monsters and evil spirits. The bad boys and those they run with are most likely to use a "derivative" of the Martin Armstrong story. Remember Armstrong (now a jailbird) of Princeton Economic Research, who charged that so much silver had been moved from the United States to London warehouses, that silver was "coming out of the cracks in the pavement" over there? Also there was something said about so much silver being moved to London, that there wasn't enough warehouse space to store it! Why didn't they just end it all by saying Australia was stacked coast to coast 15 miles high with 1,000 ounce bars? Here's what I predict the silver shorts will claim has happened when Butler's silver hurricane strikes (or Savoie's silver supernova)---ARAB FINANCIERS HAVE BOUGHT ALL THE SILVER IN LONDON AND MOVED IT TO SAUDI ARABIA OR TO IRAN in retaliation for a U.S. strike on Iraq, which is now viewed as an attack on Islam! Their claims will be given great credence in the media because the Hunts had various Saudi allies in the 1979-1980 silver run-up, and it will additionally be alleged that they selected an opportunity to retaliate for their exchange caused losses almost 23 years ago! As the TV news story concerning Arab sabotage of the silver market is aired, will we hear in the background the old radio tune by Ray Stevens from 1962, "Ahab, the Arab, the sheik of the burning sands?" This, then, becomes the reason for soaring silver prices---a shortage caused by another market manipulation by malevolent longs, while the choirboy naked short derivative vultures are on hand to "explain" the reason for the crisis to us. (As for these choirboys, they should be medieval Italian "castrati," you see, so their voices wouldn't change, or in the present case, to stop them from breeding!) They could say, we were getting ready to supply proof in response to Butler's demand, that there indeed was much more than 300 million silver ounces to back the short sales, but just before we could do it, a consortium of Arab financiers, being religious zealots and Islamic radicals, swooped down on London and emptied all the warehouses of silver, and spirited it off (on flying carpets) to be stored in their palaces and harems. They did this as part of a financial "jihad" against the United States! They may also be faulted for the unfolding scandal of fake sterling silver jewelry being reported by magnet carriers across the country. If you could see the insides of the shorts brains, it would look like the cover of a science fiction novel, and the counterfeit disclaimers they are capable of fabricating call to mind the statements on windshield de-icer aerosol cans---"Warning! Fatal or causes blindness if swallowed! Cannot be made nonpoisonous!"


Arab resentment of the "Christian west" traces back most of 1,000 years to the Crusades in the Holy Land by European knights. Richard Maybury speaks of the Thousand Year War at his website. There is truth in this concept. After the fall of Constantinople (now Istanbul) in 1453, the Islamic world, and much of the Balkans, was controlled by the Ottoman Turks until about 1829, when the Greeks overthrew them with assistance from England, Russia and America. Many Arabs viewed the establishment of Israel in 1948 with disfavor. The United States naval warship Vincennes "mistakenly" (?) shot down an Iranian airbus (flight 655) over the Persian Gulf on July 3, 1988, killing 290, and we as coalition leaders beat back Saddam Hussein's invasion of Kuwait in 1991. Probably in retaliation for the airbus incident, a bomb in flight destroyed Pan Am flight 103 over Lockerbie, Scotland, on December 21, 1988, causing 270 fatalities. In 1998, U.S. embassies in Kenya and Tanzania were bombed, killing 224. In 2000, the U.S. warship Cole was bombed in Yemen, killing 17 sailors. While Arab states have had deadly feuds among themselves---the Iran-Iraq war of 1980-1988 had over 1 million fatalities; they are now developing a common notion that they have a greater enemy---the "Christian west," called the "great Satan" by Iran. In this background too we find the Iran-Contra scandal, and billionaire Saudi arms dealer Adnan Kashoggi. The Salt Lake City Utah, Tribune, September 15, 2002, noted that U.S. policies might serve to unite Mideast rivals. Iranian foreign minister Kamal Kharrazi, at the United Nations on September 14, 2002, voiced concern over a looming U.S. attack on Iraq., an Arab site, quoted (September 15, 2002) Ayatollah Ali Khamenei as saying a U.S. attack on Iraq is a first step towards U.S. control of the entire region---to capture the oil resources. Word has circulated regarding Bush's requests to Congress, that Iran could be his next target! If some of the silver was sent to Iran, "recovering" it could be added to the list of reasons for attacking that country next! The unfolding scenario reads like predictions from the nonfiction book, "The Warmongers" (Howard Katz, Books In Focus, New York, 1979) which speaks of the "distressing link between the creation of paper money and major wars" and investigates the "frightening intrigue in which bankers, big business and governments create wars to increase their power and wealth" (from rear cover). We are in the hands of personalities who aren't in a state of grace and need multiple exorcisms!


The old crusader view is still very hot among Arabs, and along with support of Israel, we are viewed as conducting an ongoing attack on these peoples, which is strongly linked to an attack on their religion. Osama Bin Laden, you recall, is native to Saudi Arabia where he had business interests, and 15 Saudis were among the terrorist hijackers who used commercial jets to attack the World Trade Towers and the Pentagon on September 11, 2001. Before that, other attacks on U.S. interests took place, including the Khobar Towers truck bombing at Dhahran, Saudi Arabia, which killed nineteen and injured hundreds. This site, attacked on June 25, 1996, housed U.S. and allied forces supporting Operation Southern Watch, the patrols over the no-fly zone in southern Iraq. After the September 11 attacks, Saudi investors withdrew $27 billion from foreign banks through year-end 2001 (Dawn, Arab website in English, March 31, 2002). The U.S. also froze assets and investments of some Saudis on charges of being connected to the September 11 attacks, and lawsuits on behalf of twin tower victims are pending. Saudi and Arab money has been jittery ever since, with regard to being in the U.S., and reports are circulating of some $200 billion of Saudi money so far withdrawn from our stock market, with as much as another $800 billion at risk of being withdrawn. That would add overpowering downward pressure to the NYSE, where insiders have probably already gotten out to a large extent and gone short, so they can capture as gains, the forthcoming shocking losses of all the small investors deceived by years of "buy and hold, never sell" propaganda as the market may fall 3,000 points or more from September levels into late November. The Foreign Sovereign Immunities Act was amended so that victims can now sue foreign countries that aided or harbored terrorists, and if you're about to be sued, you will be tempted to place assets out of reach! The Saudis have indicated disinterest in allowing their territory to be used as a region from which Mr. Bush attacks Iraq. Is this proposed attack in part to distract attention from the tumbling stock market? Financial scandals aren't only recently associated with the Bush camp. Remembers his younger brother, Neil, was a director of the ill-fated Silverado Savings & Loan, whose collapse in 1988 cost the public some $1 billion! Silverado was made of paper, not silver! With the continuing debasement of the dollar, it makes you wonder if aluminum coins are coming---aluminum quarters, nickels and dimes! This isn't farfetched, as Paul O’ Neill, Treasury Secretary, came there from the chairmanship of the Mellon family's Alcoa. Then see how prostitute commentators will still try to make the public believe silver coins are "sterile assets!"


Ironically, only five days before the COMEX and CBOT rule changes which destroyed silver longs, the January 16, 1980 issue of Al Riyadh newspaper, which was later translated in the English language weekly magazine, Saudi Business, reported that Farouk Akhdar, director of Saudi industrial development at Jubail, stated his belief of the silver scene that, "the whole operation was an attempt to defraud the Arabs of their wealth and return to the industrial economies what we earned by selling oil." And so it turned out, though the shorts keelhauled the Hunts and their Arab partners only when they became vulnerable. No one made the Hunts and Arabs go after silver, it was their decision and they were crushed because they went head to head with the "old rich," the establishment rich, who controlled the exchanges and the government agencies concerned. Akhdar's prophecy about his fellow Arabs, fulfilled so swiftly after he made it, is uncannily similar to the fate of millions of small investors in the Nasdaq tech wreck and the telecom bust, and other stock frauds like Enron. Friends, all these financial subversions were planned in advance by the old rich to get their payrolls back! To appease public wrath, certain fall guys were selected, and lawsuits and settlements may recover $100 billion of as much as $7 trillion looted from the public. What a deal! For every $70 you steal, you only have to give $1 back, and someone takes the blame for you! Meantime, rigged lists of what big rich are worth continue to appear in high profile magazines, downplaying their actual wealth and omitting from the lists names which belong near the top! And associated with these names are the 4 or less, and 8 or less largest COMEX silver shorts, whose identity we strongly suspect, and will eventually be confirmed! Remember what Franklin Roosevelt did with gold and silver---well, his relative, Theodore Roosevelt IV, is a Lehman Brothers executive today---the same Lehman Brothers which supplies "advisors" to the CFTC! As for JPMorganChase and Citigroup, they are under accusations for racketeering connected to pension fund losses at Enron ($33 billion wiped out) and elsewhere. The gold and silver meltdown will hit them like a tree crushing a lumberjack.


To return to Stephen Fay ("Beyond Greed," 1982) on the Hunt/Arab silver play, he spoke of Saudi society as "forbidding" and concerning Mahmoud Fustock, he said he was similar to a "character in an old B movie who is never quite to be trusted." If we could see Fay, what would he look like? A wheezing bubble and goo monster from the "Outer Limits," or one of the demonized, tortured grimacing faces from Rod Serlings "Night Gallery?" Fay, in his near total whitewash of the shorts, showed his bias throughout the book. Fustock was the brother in law of and representative in the silver play of Saudi Crown Prince Abdullah Ibn Abdul-Aziz Al Saud. After the exchanges ordered liquidation only in silver, the Arab assets used in the Hunt silver play turned into a barrel and suspenders as they were stung by a huge wave of margin calls. Fay said of these highly placed Arabs, "their anger was infinitely fiercer than had been supposed" (page 268). So the shorts of today can conjure up the story that, the Arabs never forgot what happened, and just now retaliated after years of patient planning, by removing a titanic stockpile of silver from London, to hurt the West! Fay referred to "Fustock and his angered coconspirators" (page 272). Interesting how the new rich are always the bad guys, and the establishment old rich are the good guys. That's the picture you can paint when you dominate the media. In a lawsuit filed in the aftermath of the silver crash, Fustock made reference to a scheme to cheat and defraud him and others of hundreds of millions of dollars. Since then billions have been stolen in the silver market by shorts and users, with leasing stealing silver from reserves of many nations especially America, so greedy perpetrators could get silver for next to nothing! This was NOT the doing of the Hunts and Arabs---it was another ripoff staged by establishment old rich! Now that we are about to enter a period of chronic silver shortages and high prices, the shorts are set to scapegoat the Arabs, which will be politically acceptable! As one of many examples, consider the Chuck Norris film "The Hitman" (1991) in which he said, "You camel jockeys eat this ####?"


Naji Nahas, an Arab investor in Brazil of Lebanese ancestry, and his cousin, Selim Nassif, were associated with Khalid Bin Mahfouz (oil and National Commercial Bank of Jeddah, Saudi Arabia) and Gaith Pharoan, of Redec, which owned construction companies, a stake in Hyatt Hotels, and Plaza of the Americas in Dallas, were part of the Arab consortium which joined the Hunt silver play. Pharoan's father was a medical doctor who attended the Saudi royal family. Also parties in this situation were Ahmed and Mohammed Kaki, also of the National Commercial Bank of Jeddah. Additional participants were Sheikh Mohammed Aboud Al Amoudi, Ali Bin Massalam and Mohammed Salah Affara (representative of Khalid Bin Mahfouz), who were 50% partners with Nelson and Herbert Hunt in International Metals Investment Company based in Bermuda. Crown Prince Fahd was believed, but with perhaps inconclusive evidence, to have been a participant. There was talk of SAMA (Saudi Arabian Monetary Agency, the central bank), in which Prince Abdullah could certainly have pulled strings, using some of its then $60 billion of reserves to buy silver, for purpose of monetizing silver and using it as a reserve asset. This didn't happen, however, since the Saudis and some other Arab allies like Nahas were burned by the shorts controlling the U.S. exchanges, other Islamic nations have suffered by actions of western financiers. Prime Minister Mahatir Mohamed named George Soros as the principal villain of the Malaysian currency crisis during the Asian financial crisis of 1997-1998, and then Secretary of State Madeline Albright verbally castigated the Prime Minister for speaking ill of Soros! Maybe we'll hear that some of the (phantom) London and Swiss silver stockpiles ended up in Malaysia. As currencies are set to fall and silver to rise, Soros is ready with a big interest in an important silver company!


Mahatir Mohamed is now an advocate of a bi-metallic based (gold and silver) currency and trading system to be used in Islamic nations representing some 1 billion Muslims. Apart from Malaysia, other formal members include Libya, Morocco, Iran and Bahrain. See what the shorts can say? Those evil Arabs took all the silver out of London to hurt western industry and use in their awful bimetallic system to return to---(AARGH) real money! Bush named Iran as part of the "Axis of Evil" with China and North Korea, so when we attack Iraq, the Chinese Reds will likely destroy the Taiwanese defense forces! And Libya has been known as a terrorist state for many years. So, why not blame Arabs for missing silver---which wasn't there to start with because it was absorbed into the deficit---they make the ideal scapegoats! The Arabs even have an Islamic Mint and, with some 300,000 clients already (see news, "Banking on Bullion," September 2002 by Ayman Dunseath). The proposed system uses gold dinars and silver "dirhams." Do I think some Arabs have been accumulating silver as well as gold---certainly! However, since the Hunt silver hearings in Congress, a reluctance has existed on the part of silver longs—no matter how great their financial resources---to take positions in silver as large as any one of them could have taken. Bill Gates owns something like 15% of a major silver company, George Soros owns about 27% of one of its peers, and Buffett bought close to 130 million ounces of physical, though it appears he didn't take delivery of all of it, and may have leased the rest out. The point is, large scale investors, including the Saudis and their allies, with bitter experiences on the COMEX and CBOT, are hesitant to buy as much silver and silver equities as they could, due to the hostile media publicity they would likely encounter when the sustained silver run up takes place.


Saudi Arabia has stated it will not consent to having U.S. forces use its territory as a base from which to launch an attack on Iraq, but that if the United Nations decides to pursue military action against Iraq, they may do so with use of Saudi territory as a base. Understand, by saying this, the Saudis are expert fence-straddlers---they appear uncooperative to President Bush, yet cooperative to the global community. Except, the Saudis realize, the required consensus is not presently available within the U.N. for a near term strike on Iraq. The Saudis expect no U.N. sanctioned war against Iraq, and appear to be pressuring the U.S. in various ways to not attack Iraq. British Broadcasting Corporation News, September 10, 2002, reported a Saudi Trade Fair is scheduled to be held in Baghdad during November 1 through 11, this year. Up to 70 Saudi firms are expected to be on hand, including The Olayan Group. Olayan Group is headed by Suliman Olayan, Saudi billionaire with establishment credentials in America including---member advisory council to JP Morgan & Company, 1979-1990; director, Credit Suisse First Boston (Mellon interests) 1988-1995; member Rockefeller University council since 1978; and member, U.S./Saudi Arabian Joint Commission on Economic Cooperation, 1980-1992. Interestingly, former Treasury Secretary William Simon, who as a COMEX governor took part in the rule change, which destroyed the Hunts and their Arab allies, was deputy chairman of Olayan Investments, 1980-1982. Simon was also a director of the Gerald R. Ford Foundation, and as we saw in the September essay hosted here, Ford appointed William Bagley to head the CFTC. Simon was also a member of the public review board of the now totally disgraced accountant of Enron, Arthur Andersen & Company. Simon was a Halliburton director, and our Vice President Mr. Cheney was a Halliburton executive. It has been widely rumored that the U.S. and Britain wish to strike Iraq to get at the oil resources there, and of course, Halliburton is an oilfield service company, and would clean up!


Now you say, if Arabs were partners with the Hunts, what is an Arab doing associated with interests linked to silver shorts? This is a case of both sides of the street being worked. You see, while the Kingdom of Saudi Arabia truly doesn't want to see the U.S. strike Iraq, our main ally, Great Britain, does want Iraq under fire. In 1987 Olayan was made a Knight of the British Empire, bestowed upon influential persons regardless of ancestry, whom Britain perceives as helping to advance its interests. It is time to realize an astonishing fact, friends---the show is being run by British interests (even though Bush makes most of the noise), while America supplies most of the military might! We the stronger nation militarily, are nonetheless the junior partners in what is called globalization! Various researchers have perceived the Federal Reserve to be th

BlackjackWest African economies tanking, civil wars spreading#8635410/02/02; 00:05:01

"Ivory Coast came up trumps as the best place in Francophone Africa to do business," said David Frost, who organises British trade missions.

"It was going great. Now it's shattered."
And it is home to some of Africa's most prestigious financial institutions such as the African Development Bank and the West African stock exchange, while Nestle has its African headquarters there.
And about 60% of the goods imported by Francophone West Africa pass through the port of Abidjan.

Abidjan's pre-eminence is inherited from colonial days when the French chose to govern from there.

Investment flowed into the region, creating the world's largest cocoa producer, with vibrant coffee, timber and oil refining industries.

And that led to the development of a services industry and a regional hub for banking, insurance and advertising.
"It further emphasizes to anyone considering doing business in Africa, that the place is full of unexpected coups," said Mr Cowan.

"A threat to Ivory Coast is a threat to all of us," declared Nigeria's President Olusegun Obasanjo, dispatching fighter jets to the troubled region.

While Mr Obasanjo was referring to escalating violence, his comment also sounded a warning bell for the region's shaky economics.
Civil War and Chaos spreading in West Africa. I lived in Ghana
many years ago. Ghana is next to Ivory Coast where the present
crisis is. Ashanti gold fields are close to the trouble. Civil Wars
in this region will affect certain commodity prices.
Oil, gold, timber,chocolate, coffee. Lots of lost export business for many intenational companies not to mention costs of destruction
in the fighting. Very sad. Not to mention debt defaults for international banks. Nigeria has already defaulted on about $33 Billion if I recall correctly.

Black BladeShoppers take a breather #8635510/2/02; 00:10:29

Retail slowdown raises Christmas season worries


Oct. 1 — Shoppers cut back spending at some of the nation's big retail chains in September, heightening retailers’ worries about the all-important Christmas shopping season.

Black Blade: I think Santi Claws will not be coming to a lot of homes this year and he will be a cheap skate for many others. Me? I'll sit on top of the house and try to drop a couple of reindeer (just kidding).

Black BladeChain Stores Sales Drop Amid Weak Economy #8635610/2/02; 00:12:19


NEW YORK (Reuters) - Struggling U.S. chain stores received another blow last week as consumers tightened their purse strings amid concerns over the strength of the economy, two reports showed on Tuesday. Sales at the nation's chain stores fell 0.8 percent in the week ended Sept. 28 after a 1.7 percent decline in the preceding week as consumers kept a distance from U.S. shopping malls, the Bank of Tokyo-Mitsubishi and UBS Warburg reported. "Retail sales activity has fallen off dramatically in the last couple of weeks," said Frank Badillo, senior economist at Retail Forward. "It could be a blip or it could be a sign that the economic downturn of the last year is finally catching up with consumers."

U.S. consumers account for two-thirds of the nation's economic activity, so analysts tend to keep a close eye on consumer behavior for signs about the broader health of the economy. The diagnosis at this point is not that favorable. As retailers prepare for the crucial holiday season, consumer confidence is sagging in the face of continued job insecurity and a floundering stock market. Some retailers told Redbook consumers were "inhibited by political uncertainty, a slowing economy and the negative wealth effect from falling stock prices." Even discounters, which have had an edge over department stores as economic uncertainty drives consumers to hunt for bargains, are feeling the pain.

Black Blade: It looks to get quite ugly, and this is without the influence of the west coast dockworkers off the job. The closure of the west coast docks are costing the U.S. economy over $1 billion/day and that will accelerate with time. It should be noted that there are also perishable goods that must be unloaded soon or destroyed. That too will add to the costs as insurers and companies eat the costs. Then there are all the other ancillary jobs that will be lost as the holiday season approaches throwing cold water on consumers shopping plans. "Interesting Times"

BlackjackCredit Suisse bails out insurer with 2 Billion swiss francs#8635710/2/02; 00:13:26

Credit Suisse Group said it has injected a further 2 billion sfr into its insurance unit Winterthur as part of a capital plan announced in August.

Credit Suisse also announced that in the third quarter of 2002, its results will be impacted by a significant net loss in the insurance business, as well as by a modest overall negative effect from its other businesses.

This capital contribution will reinforce Winterthur's solvency capital to support the growth of its business in this challenging environment, the group said.

Under the capital plan, Credit Suisse has now increased the equity of Winterthur Insurance by 0.6 billion sfr and completed a direct capital injection of 1.4 billion sfr into Winterthur Life, it said.

These transactions were financed by excess liquidity from the Credit Suisse Group parent company and therefore do not impact banking capital ratios, the financial group said.

Additionally, Winterthur has substantially reduced the equity exposure of its investments portfolio to mitigate the impact of international equity market volatility on its solvency capital as far as possible, Credit Suisse said.

However, related hedging costs and further realised losses again impacted Winterthur's capital base in the third quarter, it said.

Moreover, Winterthur's solvency capital was reduced by growth in premium volumes, particularly from rate increased, it added.

Black BladeBIG DROP in Oil Inventory! - API data show storm sliced oil supply #8635810/2/02; 00:14:12


NEW YORK (CBS.MW) -- The American Petroleum Institute reported a nearly 14 million barrel drop in last week's crude supplies late Tuesday, on the heels of storm disruption to output and exports from the Gulf of Mexico, a key oil and natural gas producing region. After the market closed Tuesday, the American Petroleum Institute said domestic crude supplies fell by 13.9 million barrels during the week ended Sept. 27. IFR Pegasus in New York predicted a crude supply decline of 6 million to 10 million barrels, while news and information provider Platts pegged its estimate on crude supplies at a decline of 6 million barrels. U.S. crude supplies had already fallen around 15 million barrels in the last four weeks prior to the latest report. Total domestic inventories now stand at 275.9 million barrels, compared to the 307.7 level seen a year earlier, according to the API.

Black Blade: 14 million bbl decrease!!! That's twice as much as expected. It's going to be a long cold winter. Getting the skis ready.

Black BladeCrude Oil Rises as Hurricane Lili Heads Toward U.S. Gulf Coast#8635910/2/02; 00:15:38


New York, Oct. 1 (Bloomberg) -- Crude oil rose as offshore producers slowed output and evacuated workers to limit damage from Hurricane Lili, which is moving toward Texas and Louisiana. Royal Dutch/Shell Group said it will evacuate all workers from its platforms in the Gulf of Mexico today. BP Plc, ChevronTexaco Corp., Apache Corp. and Marathon Oil Co. have also announced evacuations. An American Petroleum Institute report today is expected to show that U.S. inventories fell last week after Tropical Storm Isidore forced similar evacuations. ``The situation along the Gulf looks pretty ugly,'' said David Becker, manager of energy derivatives trading at Citibank NA in New York. ``We're going to see exceptional numbers in the API report today and in the next two weeks because of all the disruptions.'' U.S. inventories in the week ended Friday probably dropped between 5.3 million and 6.2 million barrels from an 18-month low of 289.8 million barrels, according to estimates from nine analysts surveyed by Bloomberg News. The supply report from the Petroleum Institute is due after floor trading ends. ``It's not the draw we'll see to tonight that worries me,'' said Phil Flynn, a senior energy trader at Alaron Trading Corp. in Chicago. ``We'll be seeing draws for weeks because of Lili.''

Black Blade: It appears that yet another tropical depression is forming and another hurricane could develop. These people in the Gulf just can't seem to catch a break. It looks like winter is finally here as temperatures are dropping and stormy weather is ripping through the west into the Rocky Mountain region. With low oil inventories and the switchover to full heating oil production not yet underway it looks to get rather "interesting". Soon we will see drawdowns on NatGas supply.



WHEN the stock market rose 158 points last Wednesday, Bloomberg News and The Times said it was because General Electric had reaffirmed its profit target. - Nonsense. And when the Dow jumped another 155 points on Thursday, Reuters put out the word around the world that it was because of "strong economic data." That was even bigger nonsense. Hey, the media has the right to be stupid whenever it wants. But the reason for these two jumps was just too transparent to miss. Wednesday was the last trading day of the quarter for anyone on a so-called "settlement basis" - which means trades have to occur three days before the end of the month to count toward September's performance.

Today, of course, is Oct. 1. What's that mean? Lousy as the market's performance has been over these past few weeks, this is now the really dangerous time. October has historically been crash month - even when times are better than these. This column warned you that the summer rally was a man-made technical blip that was built on a foundation of undercooked Jell-O. The underpinning for the October market is even weaker, thanks to scandals, Iraq, a disappointing economy and the inevitable corporate earnings disappointment.

Black Blade: Today's "Dead Cat Bounce" wasn't the last that we are likely to see, however, today's rally was merely a "relief rally" – essentially a "relief" that the bad news was not as bad as expected. Still the data reveals a pathetic economy is contraction and still falling into the abyss. Is this reason to get euphoric and drive the stock market to higher levels? Of course not. The rally gained steam because many speculators were short the market and the surprise rally caught these people with their fly unzipped. They had to quickly cover their embarrassment and that's what drove the market higher. Nothing more than that. Still it was fun to watch the lemmings scurry about in an attempt to keep up with the crowd.

Black BladeThe Beating isn't Over Yet#8636110/2/02; 00:18:29


Here's more news to torpedo your 401(k): We've just lived through the worst third quarter for the Standard & Poor's 500 in more than a quarter century. The Standard & Poor's 500 index was down 17.6 percent for July through September. This was the worst third quarter since 1974, when the index went down 26.1 percent. On Monday, the end of the third quarter, stocks took another dive. The Dow Jones Industrial Average lost 109.52 points and closed at 7591.93 -- the lowest point this year. The Dow fell 295 points on Friday.

Black Blade: Yep, the fun is just beginning. As always, get out of debt, stash enough cash for several months expenses, accumulate Gold and Silver portfolio insurance, and start a storage program of nonperishable food and basic goods. It is almost certain to get much worse.

Black BladeNikkei 225 Tanks!#8636210/2/02; 00:23:32

Just when you would expect to see an Asian version of "Monkey See - Monkey Do" after the day we saw on Wall Street, the Nikkei 225 reumes its fall into oblivion almost set to sink through to sub 9,000. The rest of Asia is a bit mixed or weakly positive. Could get fun though.

- Black Blade

BlackjackWest Coast dock workers strike gets uglier#8636310/2/02; 00:24:10

OAKLAND, Calif. (Reuters) - Efforts to start federal mediation for a U.S. port dispute that has stranded mountains of cargo on West Coast docks collapsed Tuesday after the longshoremen's union stormed out of talks, accusing port employers of bringing "gun-toting thugs" to the meeting.

A federal mediator later rebuked the port employers for bringing armed security guards to the talks, calling it inappropriate and a breach of bargaining protocol.

A spokesman for the port employers said the group wanted to get back to the negotiating table and would in the future follow the ground rules laid down by the federal mediator.

"While today's development was unfortunate, I am pleased that the parties agreed to meet and that they came together this morning," Peter Hurtgen, director of the Federal Mediation and Conciliation Service said in a statement. "I remain hopeful that these negotiations can move forward."

Earlier, International Longshore and Warehouse Union President James Spinosa had accused port employers of intimidation.

"It is totally out of line. This is nothing more than intimidation," Spinosa said as he pulled his negotiating team out of the meeting with federal mediators in Oakland, California. "The meeting was called short because of the armed men."

It was unclear if or when the discussion of possible federal mediation -- urged by President Bush and a growing list of worried U.S. businesses -- would resume.

Tuesday's meeting, following a brief negotiating session Monday, was aimed at outlining a suggested framework for mediation of a labor dispute which has idled every major West Coast port and poses a growing threat to the U.S. economy.

The Pacific Maritime Association, which represents shipping companies and terminal operators at ports ranging from San Diego to Seattle, locked some 10,500 union workers out of the docks Sunday after accusing them of staging widespread work slowdowns as contract negotiations stalled.

The ILWU's Spinosa said he was withdrawing from the preliminary talks after PMA representatives arrived at the meeting with two armed guards -- described as "gun-toting thugs" by one union spokesman.

Spinosa said he would consult with his negotiating committee Tuesday on whether or not they would go ahead with a planned meeting with PMA officials Wednesday.

"We feel that this set of negotiations has taken a turn for the worse," Spinosa said. "We are very, very far apart."

The union said it would insist that future negotiating meetings take place between the two group's executive committees, and that it had no intention of signing a contract extension -- a key PMA condition for unlocking the ports.

PMA officials, for their part, said they would not change the negotiating team and that it appeared the talks scheduled for Wednesday would not happen.

"We have no idea if there is a meeting tomorrow," PMA negotiator Tom Edwards told a news conference. "The talks right now are not going."


The collapse of Tuesday's mediation meeting marked a fresh setback in a port labor dispute, which has grown increasingly rancorous over the last several days.

President Bush said Tuesday he was concerned that the dock lockout could hurt the economy and urged the parties to use federal mediation to resolve their problems. Port managers estimate the shutdown is costing the U.S. economy as much as $1 billion per day.

"We're worried about it," he told reporters at the White House. "We're closely monitoring it.

"There's a federal mediator on the ground and I urge both parties to utilize the mediator," Bush said. "We're just going to have to get these parties to work through it, get back to work, open these ports up. It's important for our economy to do so."

Union officials said Tuesday they had no intention of going to Washington to continue discussions with federal mediators, although they did not permanently shut the door on possible mediation efforts.

The West Coast port lockout has raised fears that shipping could remain paralyzed for days or even weeks in the crucial run-up to the Christmas shopping season.

Labor analysts say any prolonged port disruption could force the administration to act. Bush has intervened or threatened to do so in several major labor disputes at major airlines, which eventually led to settlements.

Under the Taft-Hartley act, the White House has the authority to obtain an 80-day injunction against labor disruptions that could endanger "the national health or safety."


The U.S. port dispute hinges on the issue of new technology. Port employers say it is crucial to introduce innovations to maintain competitiveness and keep pace with rising cargo volumes.

The ILWU has resisted the technical changes as a possible threat to union jobs. On Monday it informed the employers' group that the technology issue was effectively off the table.
This is a really big deal for the economy.

Black BladeMarket Indicators are Negative#8636410/2/02; 00:29:06

This is really something. US market index futures are all negative, the USD is higher, Gold is lower, Petroleum (oil and NG) is higher. However, after the EIA reaffirms the humugous drop in oil inventories tomorrow we will see petroleum prices rock on higher and the stock market could take a hit too. "Interesting Times"

- Black Blade

WaveriderUSAGOLD #8636510/2/02; 00:39:59

WOWSERS!!! What a pleasure to be second runner up and to win a Queen Victoria British Gold Sovereign...THANK YOU Sir MK, and THANK YOU Sir Gandalf for all your work in making these competitions happen! And of course, CONGRATULATIONS to Sir Sundeck, Sir Boilermaker and Sir Slingshot, and ALL the first-time posters! Cheers,

BlackjackChip Market deteriorates further, no recovery this year#8636610/2/02; 00:57:03

Cambridge, England, Oct. 2 (Bloomberg) -- ARM Holdings Plc, Europe's biggest designer of semiconductors, said its licensing business slowed in the third quarter as chipmakers delayed investments and it sees no recovery in the market before 2003.

Market conditions ``have deteriorated further'' in the three months ended Sept. 30, ARM said in a Regulatory News Service statement. ARM ``does not anticipate any significant upturn in business activity before next year.''

ARM had so far avoided the slump hurting clients such as Texas Instruments Inc. as chipmakers bought its designs, software and services for future products. Its chip designs are used in about 80 percent of the world's mobile phones.

Third-quarter revenue was probably about 33 million pounds ($51.6 million), ARM said. Pretax profit was about 8 million pounds.
No recovery here. Dock strike would really hurt exporters in
Asia, like Japan. Dell might have trouble getting parts.
Hell, Santa might go on strike.

Black BladeStock Market Blues#8636710/2/02; 00:58:37

I tend to get some interesting tidbits of information sent to my mailbox. The following is quite interesting:

It was the worst September since 1937. Stocks have gone down 6 months in a row. You'd have to go all the way back to the middle of WWII to find a longer period of consecutive monthly declines; stocks fell 9 months in a row in 1942. So far this year, stocks are down about 25%...wiping $3.4 trillion from the nation's stock market wealth. The Dow and S&P 500 both declined about 18% in the third quarter, while the Nasdaq produced a 20% loss. "It's the first time the market has had to endure consecutive negative double-digit quarterly declines since the 1930s," says CBSMarketWatch. At some point, we suppose, all the urgent selling of stocks ought to come to an end. Problem is...there is no urgent reason to buy.

Of course, the market indices are still grossly overvalued. This isn't so much due to stock prices running up in price, but rather earnings are falling faster than the price of the stocks. Now that is a scary story fit for Halloween. It certainly can't hurt to park some precious metals in the portfolio as insurance as we watch the next leg down in the stock market.

- Black Blade

BlackjackNikkie has lowest close in 19 years#8636810/2/02; 01:09:32

TOKYO - The Nikkei Stock Average of 225 issues closed at 9,049.33 points on the Tokyo Stock Exchange Wednesday, down 112.93 points, or 1.23 percent, from Tuesday. It was the lowest closing for the Nikkei in 19 years.
Will our bubble affect us like the Japanese bubble affected them?

Black Blade"Monkey See, Monkey Do"#8636910/2/02; 01:27:28

Leapin Lemmings!!! There it is. I figured some monkeys, .... errr, suckers would follow in the footsteps of the US with their own little suckers rally - "monkey see - monkey do". This looks like fun. I guess I'll just kick back and watch the wild antics of these mischievious chimps.

- Black Blade

BlackjackUK growth to slow#8637010/2/02; 01:31:22

The UK Government appears to have admitted that it will not reach its economic growth targets for 2002 and 2003.

A key aide to the Chancellor has suggested to journalists during the Labour Party conference at Blackpool that the UK economy will not grow by 2-2.5% this year, and 3-3.5% next year, as forecast in July.
FTSE higher right now by 89, I guess they like this news!

BlackjackDoCoMo writes down $4.7 Billion #8637110/2/02; 01:52:08

Tokyo, Oct. 2 (Bloomberg) -- NTT DoCoMo Inc., the world's largest mobile-phone company by sales, said it will write down 573 billion yen ($4.7 billion) in its fiscal first half to account for the declining value of its overseas investments.

On a parent company basis, Tokyo-based DoCoMo will write down 339 billion yen of its investment in AT&T Wireless Services Inc., 108 billion yen of its stake in KPN Mobile N.V. and 126 billion yen of its holding in Hutchison 3G UK Holdings Ltd.

DoCoMo is facing further losses on its 16 percent stake in AT&T Wireless after that company's shares plunged 54 percent in the six-month period ended Sept. 30. The share decline put DoCoMo's investment in the No. 3 U.S. cell-phone operator at about $2.2 billion, less than half what the Tokyo-based cell-phone operator valued it at earlier this year.

In May, DoCoMo wrote down its original $10.2 billion investment in AT&T Wireless by 506 billion yen ($4.1 billion).

AT&T Wireless's shares closed at $4.12 on Monday, the end of DoCoMo's fiscal first half. They're 82 percent lower than the $23.50 a share DoCoMo paid for AT&T Wireless stock 21 months ago.

The shares fell 54 percent since DoCoMo's fiscal year ended in March. DoCoMo paid $9.8 billion for its stake in Redmond Washington-based AT&T Wireless in January 2001, investing $380 million more a year later to maintain its holdings at 16 percent.

Between December 1999 and January 2001, DoCoMo bought stakes in U.S. and European carriers in hopes the companies would adopt the same technology DoCoMo uses for its high-speed wireless Internet service.

The company's shares fell 1,000 yen, or 0.5 percent, to 205,000 at the 3 p.m. Japan time close on the Tokyo Stock Exchange today. They've declined 33 percent this year, compared with a 52 percent gain for rival KDDI Corp. in the same period.
Incredible stuff. Good Grief. The numbers are staggering.

slingshotUSAGOLD#8637210/2/02; 01:54:19


Thank you MK for holding the contest. To Gandalf the White and Judges at USAGOLD, WELL DONE. To all 33 entrants my admiration for I know how hard it is to put thoughts to words. To Sundeck,Boilermaker and Waverider, your words were as good as Gold.Congratulations!

There is a special Thank You for Honorable Mention. "Siege Engine" has been long in the making. Rough and course in the beginning and over time molding itself into a readable story. My use of the English Vocabulary is much to be desired and would send most English teachers running for the hills.:0) Yet you allowed me to post my story to be read by those around the world. I have no words to describe my feelings on that point.:0)
Writers wait a very long time to receive a Honorable Mention from anyone.

Happy Birthday USAGOLD.

Black BladeGold companies turning against hedging#8637310/2/02; 02:27:28


DENVER, Oct 1 (Reuters) - Hedging, a standard tool of financial management aimed at locking in a profit if prices fall, is almost a dirty word for major gold producers now that prices for the precious metal are close to three-year highs. "We don't do it. We don't believe in it," Meridian Gold Group (MDG) President and Chief Executive Officer Brian Kennedy said on Tuesday at the Denver Gold Group's Mining Investment Forum. "We've taken the no-hedge pledge," Glamis Gold (GLG) Chief Executive Officer Kevin McArthur told the conference. Goldcorp Inc. (GG) Chief Executive Officer Robert McEwen, who calls hedging "toxic," said companies would be better off considering other funding alternatives such as selling an equity stake to finance a project rather than going to a bank which will insist on a hedge. "The industry says 'don't worry about a hedge, we can roll it over and avoid a margin call.' But if the price of gold rises $70 an ounce you're wiping out shareholder value," he told Reuters. He rejected the idea that with gold prices recently doing better it may be time to reinstate hedges. "It's too early. We're going to have another eight years of a strong market," he said. He said about two-thirds of the industry was hedged. McEwen said gold producers have cash on hand and should not be compared to high-technology companies that saw incredible stock price rises based on a hope that they would make money in the future. Kinross Gold Corp. (KGC) Chief Executive Officer Robert Buchan said after his company announced in April it would not renew a hedge on 500,000 ounces of gold he got a telephone call the next day from a major U.S. bank, saying it was interested in buying a large block of stock. "There is no way on heaven or earth that I'm hedging," he said.

Black Blade: Gold producers are turning away from "toxic waste" and are looking forward to full exposure to the price of gold. Of course with interest rates at near zero, there is no compelling reason to take on such inordinate risk. One of the reasons that the price of gold is so cheap now is because of forward sales by mediocre managers with overpriced operations. The day of the hedger is over and now there is plenty of speculation that Alan Greenspan and friends will probably cut rates again. If so, then that will be just another nail in the coffin for forward sales.

Sundeck$$$$ USAGOLD COMPETITION - GOLDEN THANK YOUs TO ALL $$$$#8637410/2/02; 04:31:44

What is this? Can this be true? I come back to the table to assess the early evening news (Oz time) and what do I find? I was so surprised I had to shake my head and push my beaver up for a clearer view...

Sir MK and Sir Gandalf the White and all other humble appreciation for your kindness and bold efforts!

To Sir Boilermaker and Lady Waverider, congratulations on your brave and wise words.

And to all entrants, and to those other Ladies and Knights who frequent this place...sincere thanks for your valuable contributions.


Humbly yours

Sir Sundeck

USAGOLD******Contest******#8637510/2/02; 05:58:26

Congratulations to our winners. The essays were outstanding -- and 33 entries!! Big time! The sitemaster is now setting up a special page with all the essays, so newcomers can get a sense of what this Table Round is all about. Thanks, Gandalf, for doing such a great job conducting these contests; Randy, for helping with the difficult task of choosing a winner; and special thanks to all our contestants for making our Birthday celebration such a success.

Onward, my fellow goldmeisters!

misetichJapan and U.S.: Bubble, Bubble, Toil and Trouble#8637610/2/02; 07:06:09


"I don't know at what point welcome disinflation might morph into unwelcome deflation," Robert D. McTeer, the president of the Dallas Federal Reserve and one of the two dissenters, said in a speech on Monday. "I don't think we're there yet."

"But that really doesn't much matter," Mr. McTeer added, "because I do believe faster real growth is essential." Promoting faster growth will also ward off deflation, he said.
The U.S. economy has become the big growth engine that won't," said Edward F. McKelvey, a senior economist at Goldman, Sachs.

Fake rallies on Wallstreet are not going to help to boost confidence

It'll get much worse

Got gold?

misetichCredit Suisse Puts Another $1.3 Bln Into Winterthur#8637710/2/02; 07:14:28


Zurich, Oct. 2 (Bloomberg) -- Credit Suisse Group pumped another 2 billion Swiss francs ($1.3 billion) into its unprofitable insurance unit and said its investment banking business will post a third-quarter loss.

Switzerland's second-largest bank already put 1.7 billion francs into the Winterthur insurance subsidiary and last month took steps to replace Chairman and Chief Executive Officer Lukas Muehlemann after calls from investors to fire him.

Tumbling stock prices have cut into capital at Winterthur and reduced earnings in other parts of Credit Suisse's business. Credit Suisse is being dragged down by Muehlemann's five-year, $22 billion expansion into investment banking and insurance just before markets started falling. Investors said they didn't expect a third-quarter loss at Credit Suisse First Boston.

``The investment banking loss worsens the situation for the whole company,'' said Sandro Monti, a fund manager at BSI AG, which oversees 49 billion francs and holds Credit Suisse shares.

Credit Suisse said its insurance business will have a ``significant'' third-quarter loss. The Zurich-based company also said more measures may be needed to bolster Winterthur's solvency, depending on market conditions.

The 2 1/2-year equity market slump is forcing European insurers including Swiss Life and Aegon NV to seek more than $10 billion from shareholders to ensure that they can pay claims.

A teardroplet upon reading whats happening to manipulating investment bankers -NOT

Got gold?

BoilermakerMy Humble Thanks to USAGold, The Oaken Table of Yore and Sir Gandalf#8637810/2/02; 07:51:18

I am truly honored to have been a runner up in this contest of my peers and superiors.
Also, my congratulations to the winner Sir Sundeck, to Lady Waverider as fellow runner up and to Sir Slingshot for his marvelous contribution of ancient golden intrigue. May you all take pride in your works for this contest and past contributions to the forum. Long may you remain with us on the "trail".


TruthcasterDead Cat Bounce?#8637910/02/02; 08:34:17

Could It Be That The Rally Seen Yesterday In Stocks
Was Just A Dead Cat Bounce. I Was Happy To See Gold
Do As Good As It Did In The Face Of A 4% Gain In The
Dow. It Looks Like Today The Iraq War Talk Is Back On
The Table With The Bush Administration Rejecting The
UN's Deal With Iraq. By All Means The Dow Should Be
Down 300 Points Today But We All Know It Won't Be.
I Have A Question At What Price Would Gold Have To
Be At Before We Could See Five Dollar Silver? If Any
One Has A Guess Please Let Me Know. Thanks! Truthcaster.

SpartacusFed's McDonough urges less foreign capital for US #8638010/02/02; 08:39:18

NEW YORK, Oct 1 (Reuters) - New York Federal Reserve President William McDonough said on Tuesday the United States would benefit from cutting its dependence on foreign capital, and it would help global growth at the same time.
Some analysts worry that a deficit this large is unsustainable and warn that when foreigners are no longer willing to invest in the United States, the dollar will fall sharply in value -- a concern McDonough raised last March.

While he gave no such warnings this time, the Fed president did say any adjustment needs to be gradual.

"The best way to deal with this problem is for the United States to reduce its need for foreign capital," McDonough said, cautioning that such a change should not be made dramatically because that would require a serious U.S. recession.

MKAlways believe in. . .gold!#8638110/02/02; 08:40:05

Glad that you're bound to return.
There's something I could have learned:
You're indestructible.
Always believe in. . .gold!

The lead paragraph in a David Milstead article on Gold appearing in yesterday's Rocky Mountain News.

MKDips and Blips#8638210/02/02; 08:46:47

Richard Russell made a point the other day that you can't manipulate a market against its Primary Trend. Try as one might, such exercises are ultimately doomed to failure. That essential understanding drifted through my mind this morning as I watched gold rally higher (after yesterdays dip) and stocks head down (after yesterday's blip).
sectorJapan and U.S.: Bubble, Bubble, Toil and Trouble#8638310/02/02; 08:47:09


With the American economy still sputtering and the Federal Reserve divided over whether to cut interest rates again, foreboding comparisons between the United States and Japan are gaining a renewed currency.

Japan's stock market and real estate bubbles began losing air in 1990, almost exactly a decade before stocks in the United States peaked, and the country has still failed to recover fully. The Japanese market remains near an 18-year low, consumer prices are falling and the central bank has already cut interest rates to near zero, limiting its ability to lift the economy today.

Few policy makers or economists expect this country to fall into the same trap, largely because the American bubble never reached the size of Japan's and American financial and political systems appear more flexible. Still, numerous signs suggest that the United States could suffer a hangover that lingers for at least a few years.

Although stocks rallied yesterday, the overall market is still likely to decline this year for the third consecutive year, its longest losing streak since 1939-41.
The "policy makers and economists are the same ones who failed to see the end of the various bubbles in the first place. You can stuff their opinions.

Not only is the Fed constrained against RAISING rates, they are constrained against LOWERING rates as well because such a move would put Fannie Mae further under pressure in its "Duration gap" dilemma. Recall that the duration gap happens when rates fall too fast and FNM's long bond coverage falls short of the refinance activity.

So…the Fed is caught between a rock and a hard place as we go into a war, energy problems and a Latin American currency melt down that may spread elsewhere. Oh…there's the dock strike to smash holiday sales too…and the auto industry flaccidity.

Anf then there's the Fed's McDonough [below] talking about a falling dollar as being good for "Balance".

The Fed is trying to make lemonade out of a lemon.

Is it October yet?

sectorBanks sent spinning#8638410/02/02; 08:59:16

The evidence cited by Mr Spitzer is often devastating. At a "best practice seminar" in January 2000, analysts were taught how to manipulate financial models to support the investment bankers. One speaker said such practices could generate an extra $1bn of revenues. He also made clear that analysts would benefit, since their pay was linked to fees generated. Mr Grubman averaged $20m a year in compensation, having helped generate $1.1bn in revenue between 1998 and 2001.

But equally damaging is the evidence that Salomon people - including Mr Grubman and his bosses - knew there was something wrong with the system. One group particularly incensed by it all were the retail brokerage staff, who found the firm recommending worthless shares to their clients. In comments made during 2000, one admitted that clients had lost millions of dollars, while another hoped clients would sue. […]
The New York banking sleaze as never before.

Will Grubman go to jail? Will his bosses?

Three guesses for the three monkeys of the DOJ.

USAGOLD / Centennial Precious Metals, Inc.The assistance you want, the professionalism you require.#8638510/02/02; 09:39:28

gold sovereigns
Gold Today!

Because you never know what tomorrow will bring.

In this global marketplace, a single event on the far side of the world can suddenly and adversely affect the performance and credibility value of the commercial positions within your investment portfolio.

Gold has no employees, no overhead, and no financial statement to balance. It cannot go bankrupt. Gold is wealth itself. It is valued worldwide on the basis of its uniquely reliable form and function -- a steadfast financial commodity which is immune to the contagious collapses to which all financial paper is prone.

In the final analysis -- in times of stress -- paper is only paper.

How solid is your portfolio?

USAGOLD - Centennial is here to help.

Tommy PTerrorists attack#8638610/02/02; 10:16:46

They will start picking off people one by one!
Nibelungcongratualtions on a fine contest#8638710/02/02; 10:36:35

Congratulations to all for a fine contest, and especially to the winner and two runners-up.

I've just re-read those three entries, and enjoyed each one !

PizzCoincidents - Are we on the Brink?#8638810/02/02; 10:37:34

The UN's weak stance with Iraq is understandable only from the perspective that they've let Sadaam virtually ignore their resolutions for the past few years, and my guess is that he's positioned himself where he wants to be while we have spent the last year chasing terrorists in Afganistan and elsewhere.

Now the UN is in a box. If the US strikes and Sadaam retailiates with WMD's, the UN as a power will be done. Even more so if Sadaam launches a preemptive "use it or lose it" strike (getting more likely day by day).

Bush rams thru Congress an agreement to be able to strike Sadaam virtually as he sees fit, if the UN fails. Sadaam backing down somewhat in what appears to me to be a stall for a little more time, which Bush is just not giving him unless he capitulates to inspection with absolutely no restrictions. I just don't imagine Sadaam rolling over and losing face completely.

Now, remember just a few weeks back with all the concern over shipping containers and the posibility of a nuke to a West Coast port?

Last time I checked the West Coast ports have been (conveniently??) shut down. Yesterday, when a Seattle union rep was interviewed he said basically that it wasn't the union, but they had been locked out by the shippers - and you know, I believe him. Even I'll admit that the longshoremen are not to be taken lightly, but if they are the ones with a big enough grievence for a strike, just why did the shippers feel they needed armed body guards for negotiations - especially since the whole dispute is over what I heard this morning to be automation for bar coders to track containers?????

Never have believed in convenient coincidents, and it makes me wonder just what might be floating off our shores, or what we may think is floating off our shores.

Gold is poised for a breakout, gold stocks are oversold on a daily basis, and it appears we're having a dead cat bounce in the SMto shake out the weak shorts so the specialists can unload a bit of inventory they've accumulated and short their trading portfolios again.

Just like a big chess game, only real and in real time.


BlackjackWest Coast ports closed for 6th day#8638910/02/02; 11:18:41

Los Angeles, Oct. 2 (Bloomberg) -- U.S. West Coast ports are closed for a sixth day and no talks are set to end a dispute with shipping companies and dockworkers, increasing the chance that a prolonged shutdown will hurt retailers this holiday season.

The shutdown blocked shipments for companies throughout the U.S. and Asia, from cars for automakers Honda Motor Co. and Kia Motors Corp. to oranges for Australian fruit shipper Riversun Export Pty. Second-largest U.S. railroad Burlington Northern Santa Fe Corp. said third-quarter profit was less than forecast as the closing reduced sales, and rail stocks fell.

``This needs to be wrapped up rather quickly to not have an impact on the retailers and the broader economy,'' said David Ritt, an analyst at ASB Capital Management, whose $5.68 billion in assets include 1.78 million Wal-Mart Stores Inc. shares.

The National Retail Federation asked President George W. Bush to open the 29 ports, which handle about $300 billion in trade a year, to prevent the disruption of the arrival of holiday merchandise such as electronics, toys and clothes. A 10-day close may cost the economy as much as $19.4 billion, consulting firm Martin Associates said in a study for shipping companies.
The economic picture looks grim, time to buy stocks?

USAGOLD / Centennial Precious Metals, Inc.Put our 30-years of experience, insider contacts, and professionalism to work for you!#8639010/02/02; 11:32:55


Take a look at the developing upward channel on the gold graph.

spot gold price

Now's the time to add gold to your portfolio.

For portfolio guidance attuned to YOUR needs,
contact us at USAGOLD - Centennial Precious Metals.


We've been serving investors for three decades.
Let us help YOU.

CoBra(too)Deflationary Scenario for Europe? #8639110/02/02; 11:37:56

Expert warns ECB on too tight Monetary Discipline.
Die Presse, Austria's leading paper titles, citing Willi Hemetsberger of Credit-Anstalt.

He was warning of a deflationary spiral a la' Japan and recommended less restrictive monetary policy as the US was following. Concluding, that the rout of the SM and the RE, will be followed by economic contraction, while the economic reality is a lot better than it seems.

Sounds eerily close to calls of similar experts from a time long gone by - a time of economic depression.

Interestingly, it was the same banking institution - Credit Anstalt - defaulting and leading the way into total financial and economic chaos on a global basis.

Hope to be wrong, though some more physical may be warranted! cb2

kasperjackRon Churchill-Paul #8639210/02/02; 12:37:45 Gold, Dollars, and Federal Reserve Mischief by
Ron Paul
Gold, Dollars, and Federal Reserve Mischief by
Congressman Ron Paul

The mainstream financial press has been reporting
the weakening of the
U.S. dollar as measured against other currencies.
This is unsettling news,
as a relatively strong dollar was considered a
hallmark of the economic
boom of the 1990s- a boom that had far more to do
with rapid credit
expansion than real increases in productivity. The
value of the dollar is
down 18% this year compared to gold, which acts as
a bellwether for
the health of paper money. Gold prices historically
rise when faith in
paper currencies erodes, as investors seek the
intrinsic value of gold to
protect themselves from the arbitrary actions of the
world's central
banks, including our own Federal Reserve.

Gold is history's oldest and most stable currency.
Central bankers and
politicians don't want a gold-backed currency
system, because it denies
them the power to create money out of thin air.
Governments by their
very nature want to expand, whether to finance
military intervention
abroad or a welfare state at home. This expansion
costs money, and
the big-government politicians don't want spending
limited to the
amounts they can tax or borrow. This is precisely
why central banks
now produce all of the world's major currencies.

Yet while politicians favor central bank control of
money, history and the
laws of economics are on the side of gold. So even
though central
banks try to mask their inflationary policies and
suppress the price of
gold by surreptitiously selling it, the gold markets
always cut through the
smokescreen eventually. Rising gold prices like we
see today historically
signify trouble for paper currencies, and the dollar is
no exception.
Should the dollar continue to decline in value,
America will find itself
struggling to service our already massive debt load
even as our foreign
creditors become less interested in our dollars.
Sanity has found its spokesperson in the Post Bubble collapse into Madness.

kasperjackGoldhedgers In Full Retreat#8639310/02/02; 12:57:34


Murphy and Powell have won their war against the gold hedgers.
Solomon WeaverSilver#8639410/02/02; 13:14:58

Silver Article out today - David Morgan
kasperjackThe Fed On The Horns Of A Dilemma Link provided by Theme Investor#8639510/02/02; 13:20:50 The Fed on the Horns of a Dilemma

by Hans F. Sennholz

[Posted October 2, 2002]

The Federal Reserve System may have run
out of room to maneuver. Facing a looming
recession, it resolutely lowered its discount
rate and frantically expanded its credits. Eager
to stimulate the sagging economy, it enabled
and encouraged businessmen to invest more
and consumers to go ever deeper into debt.
Yet the specter of recession refuses to fade

What is the Fed--the appointed "guardian of
prosperity"--to do? If it persists in expanding its credits, it may weaken the
dollar and ultimately frighten foreign creditors around the globe. The dollar
may fall versus the euro and other currencies, which may persuade foreign
lenders to reduce or even liquidate their dollar holdings. But the Fed may
also discover that all its expansionist efforts may be in vain, as economic
activity contracts and goods prices stagnate or even decline. In uncertainty
and fear, the people tend to cling to their cash holdings, which may render all
Fed efforts to "reinflate" rather ineffective. Further discount rate reductions
may fail to spur economic activity.
Maybe it is time to turn attention back onto Japan.

AristotleI would rather be ashes than dust!#8639610/02/02; 13:23:05

I would rather that my spark should burn out in a brilliant blaze than it should be stifled by dryrot. I would rather be a superb meteor, every atom of me in magnificent glow, than a sleepy and permanent planet.

The proper function of man is to live,
not to exist.

I shall not waste my days in trying to prolong them.
I shall USE my time.

That excellent guidance is brought to us by Jack London.

I invite you to reflect on it during a quiet moment. Reflect on this, too. Dollars are willy-nilly.

Dollars are willy-nilly.

Dollars are willy-nilly.

Ever more and more of them may be fabricated by government, society at large, whether you want this dilution or not. Sure, the wave upon wave of dollars helps to lubricate our market-oriented structure and workings of civilization. In moderate amounts the lubricant enhances the necessary tolerance (a machine term for "elbow room" that allows interconnected parts to move properly in their interactions rather than be tightly seized together) for our own individual contractual obligations as we all interact and participate within our larger society structured by specialization (division of labor.)

A little wiggle room and a thin film of lubricant is good for the long-term operation of the machine. Unfortunately, dollars are willy-nilly. The oil-can is wielded by a liberal hand that knows too much oil, while bad for clean and efficient operation, is still better than too little lubricant which would quickly cause irreparable seizure and shutdown.

Society has through time restructured its banking operations specifically so that it need not ever suffer a debilitating shortage of these lubricating dollars. Whatever they may have been at the founding of our Nation, dollars are now completely willy-nilly and administered by a very liberal hand. By design, dollars are NOT scarce, people! Nor will they become scarce. Only a fool would try to collect and save the drippings as more of this lubricant gets poured over the machine fresh daily. Sure, a shift or two in the workday may occasionally be missed, but as the heat rises here comes the flood as a reaction!

Dollars are willy-nilly and the large view reveals that wave after wave of supply washes away your attempts to achieve meaningful purchasing power. The drippings will simply be worth less and less as time marches on.

Don't cling to drippings. They will never be more than the legacy of yesterday's events. Live your life looking forward, not backward. Use your time effectively and USE your wasting dollars effectively. As the daily lubricant passes your way, incorporate the buying of Gold into your regular range of motion. We may all be just small cogs in the grand scheme of the human "machine" but we owe it to ourselves to ensure our individual freedom and range of motion. We may be a cog, but we owe it to ourselves to buy Gold and be a Teflon-coated cog.

Gold. Get you some. ---Aristotle

Black BladeRe: Aristotle#8639710/02/02; 13:46:07

Thanks Ari, good post. Now I just wonder how much easier it will be for the Fed when they can just authorize the creation of "dollars" when it is just digital "electrons" rather than printing presses and notes. The inflation of dollars will go stratospheric in the blink of an eye. Hmmm...

Also, Jack London is one of my favorite authors. Actually some of his short stories are the best. Cheers!

- Black Blade

Socrates964JPM et al#8639810/02/02; 13:47:54

Hope everyone enjoyed the rally in JPM - my European equity contacts report that their hedge fund clients are expecting a brutal decline in October of 20% or so in the broad European indices. The US should be worse.

The question is whether the gold stocks get dragged down with everything else.

I can only appeal to the charts - they are telling me that we should see some kind of peak in gold later this month, followed by a decline into mid-Dec.

I have a number of stocks that have been retracing the July-Sep leg, but seem to be stopping at the 38.2% retracement. If we can hold here or slightly lower, then we may be set up for another up leg of the same size as the Jul-Sep upleg.

E.g. HGMCY went up 7.9 points from the low at 10, has pulled back 38.2% or so to around 14.85, and could go to 22.75 or so.

Black BladeWall Street Sell Off#8639910/02/02; 14:26:36

These guys just have no sense of humor. The rumor is that some poor trader entered a humongous sell program at the NYSE by mistake and crashed the market in late trading. Another rumor is that the market cratered on hedge fund selling. What a bunch of "conspiracy" nuts. Hmmm...

- Black Blade

kasperjackCentral Bankers Beware: Murdy Ups The Ante In The Gold Miners Construction Strike#8640010/02/02; 14:34:33 The post-merger Newmont is going to have a "higher threshold in terms of rates
of return" on projects, said Murdy, and the projects he mentioned all have the
potential to meet the new threshold.

The new rate-of-return threshold is in the "high teens" - or roughly 16% to 19% -
to justify going ahead with development of a project, he said.
I wonder how $350 an ounce or better for gold would impact Barricks frenetic efforts to bust the miners construction strike. Wouldn't they have to be spending their cash on closing out their underwater hedges?

Black BladeNorthwest Airlines Slashing 1,600 Jobs #8640110/02/02; 14:35:56


MINNEAPOLIS (Reuters) - Northwest Airlines Corp. (NWAC) said on Wednesday it was notifying flight attendants of new voluntary leave programs designed to help cut up to 1,600 jobs as the carrier tries to match staffing with weak demand for air travel.

Black Blade: These airborne "Bones" are coming in for a crash landing, right into the growing "Bone Pile".

Gandalf the WhiteWOWSERS !!! LOOK AT SPOT JUMP in the "aftermarket" !#8640210/02/02; 14:40:09

Looking GOOD, Spot !
IS "Breakout" coming soon ?

The CoinGuyHello All#8640310/02/02; 15:04:54

BB: I heard that rumour to..I also heard it was a young trader at Baring's. Yeaaa, thats it... Plan on hitting the stand this weekend. We'll see what happens

Socrates: Interesting bounce off 120 on the $HUI.

Ari: Great post as usual.

Sector: Any idea when they will update the FIG for September over at ECRI?

Pizz: I haven't had time to review all of the posts while I was gone, but I tend to agree with you on the Housing bubble. These "large" increases in housing prices can/will jump off the trend, and can come crashing down, this time I would imagine because of what I perceive is a credit bubble via Noland(free money to those who don't really qualify for it) . But the trend in housing is still up(excluding rural, and corporate). My rental properties(midwest) since the 60's have risen in price steadily, some years up in value, some down, but all along an increasing trend of value. I don't expect anything to change as we go forward, especially with inflation of the $.

ALL: I didn't have a chance to participate in the conversation about 0% interest rates, after a cursory glance I'm confused about what exactly the discussion was. Possibly will take a look, and see if I can drum up a comment or two. I will add now, I'm looking, because it is priced in, possibly one more cut, but that is it. I don't even think the next cut is guaranteed, especially w/o comfort from the ECB. I saw the first break in the LB yesterday, and am watching the chart closely for any indicators of a turn in prices. Besides, what is the asset base of FNM, or FRE at 0% interest rates? I say monetize everything now, and beat the worldwide rush. We live in interesting times, and going forward those who own bonds will be living in real interesting times.

Gold, a complete asset in the hand

The CoinGuy

Black BladeInteresting News#8640410/02/02; 15:08:56

In after hours there are numerous earnings warnings coming out. Advanced Micro Devices warns of a huge fall in revenues for example.

Hurricane Lili is now a catagory 4 with gusts up to 160 mhp. Look for more oil inventory depletion as domestic petroleum production falls. BTW, the EIA announced today that oil inventories are at 20 year lows. The higher costs will hurt business.

Dock workers are still of the job as talks break down. Several layoffs from the transportation, warehouse, and retail sectors are now expected. Some companies are using more expensive transportation (ie. air freight). The higher costs will hurt business.

Rumor is that a trader at a brokerage firm entered a humongous sell order that crashed the market today. Add one trader to the growing "Bone Pile".

The Prez and dems announce a resolution to use force against Iraq. Iraq officials give Bush the finger and say go for it. Another boost to energy costs.

We do live in "Interesting Times".

- Black Blade

Off to the gym and just maybe slay the beast!

Carl HRe: Wall Street Sell Off#8640510/02/02; 15:09:13

I wonder if the person responsible was one of the many sets of "non-essential bones" that Wall Street has recently done away with...
R PowellQuick different thoughts#8640610/02/02; 15:12:11

Aristotle, Jack London's works are classics. His life was as daring and exciting as any story he wrote. Irving Stone wrote a great biography of him called "Sailor On Horseback".

Solomon, good to hear from you again! Thanks for the link and don't be a stranger.

Congratulations to all the Winners !! Thanks also to those who made it all possible !

Too bad we couldn't get that error prone stock market trader to order some gold and silver contracts. A simple error of adding a few zeros on to the number of contracts wanted might be just the spark we need.

kasperjackVIVA ZAPATA#8640710/02/02; 15:19:38

Zapata Is Out Doing His Diligence

copied off GEF

Mexico silver output falls in July
Oct 02, 07:36

According to the National
Statistics Institute (INEGI) said on
Tuesday, silver output in Mexico, the
largest world's producer,
decreased to 204,450 kg in July, down
22.0% versus the same month last
year. Gold production reduced
sharply to 1,124 kg in July, down 50.4%
compared with the same month last year.
I know Grupo Mexico for one is flirting with
bankruptcy. This decline in Mexican precious metals
production begs for some kind of explanation. Some of you backslappers better get off your butts and get digging. Rudy kasperjack

Black BladeMore News #8640810/02/02; 15:22:14

Almost forgot - a couple of high profile arrests in the corporate world. Fast Andy (Andy Fastow) former CFO of Enron is busted on several counts of fraud, etc. that carries up to 140 years in prison. All assets are seized and his parents and relatives are signing over deeds to bail him out. Also, Merrill Lynch assistant Douglas Faneuil pleaded guilty to a misdemeanor charge of bribery in exchange for squealing on Merrill Lynch broker complicity on illegal insider trading. Then true to form Merrill cut their links by firing Faneuil and his supervisor (Peter Bacanovich). Oh the games that people (and corporations) play. Oh yeah, the Rigas family (father and sons) pleaded "not guilty" to theft and fraud charges today.

Several layoffs are being announced throughout the business community tonight. That "Bone Pile" keeps growing.

Definitely "Interesting Times".

- Black Blade

Some more news that I don't have time to cover right now - auto sales are set to decline, and real estate bubble cracks are found. Gotta go.

sectorMexican Silver Production Fall of 22% and Barrick's "Production Problems"...#8640910/02/02; 15:38:35

...may be related

See...IF one needs metal to continue a rig job and IF that metal can't come from traditionally visible sources THEN one must invent an untraditional channel...
the "Mine production problem" fits the bill.

The metal IS being's just not being reported by the producers.

The metal is bought with $USD, under-the-table paper of course, so the entities are getting paid.

No proof of this but that's what I'd do if I were as desperate as the Fed and Treasury seem to be. The scam is, of course, dependant on the absence of blackmailers.

By the way whoever heard of negative interest rates for gold?...PAYING dealers to take the stuff?… Get real...NOBODY is buying THAT scam.

It's an old-fashioned bank run on gold and silver. At some point, the central banks will bolt the cabal and run for their lives to buy cheap gold as it rockets through $400 per ounce on the way to who knows how high. They bolted in the 1970's, they will bolt again. They simply will NOT let their treasuries to be drawn down to ZREO gold.

How much more time? Don't know.

I DO know that there are numerous OTHER metrics that are failing in a two-to-four months interval.

NibelungGold conspiracy allegation from the Outer Limits#8641010/02/02; 15:42:02

About a month ago I was doing some reading at a place on the web where people talk about commodity forward contracts and stuff like that. Alot of "hard-boiled trader" posturing.
People saying things like "take the suckers' money" or "eat the competition for breakfast."

Anyway, I came across a post relating to gold that was a singular oddity, which I saved and will reproduce below. Ninety-nine percent sure it's just nonsense, or perhaps some harmless tomfoolery. But there's always a tiny chance it could be purposeful rumor-planting (although I don't know what purpose it would serve). And also my knowledge of metallurgy is rather limited. The person who posted said English was their "fourth or fifth language," ostensibly to account for the poor diction in the post.

So at the risk of appearing to be a nut, in the spirit of thorough, leave-no-stone-unturned analysis of gold and monetary systems, I'll put this out on the oaken table for everyone to have a look at. I'm especially curious to know if anyone has run across this canard, or anything like it, previuosly. But also interested to hear any other comments or insights. Here it is:

"Gold, platinum... problems of their manufacture. 9/02
There is no problem of course. Only sometimes there are strange orders from some banks in manufacturing, which belongs and is being controlled by a few indexes and companies. The decision was made on the government level. There is a huge scandal coming up, but not in this year. There is a simple way- replace the ingot of a brass-alloy with two rare-earth metals and one alkaline metal, which makes an alloy witch does not differs by chemical parameters from the gold and platinum, and by physical characteristics a little bit harder. This alloy can only be detected when manufactured into some goods and it is valid as original until then. This pseudo-gold is known for long time, but six years ago was made up a game, for the next 10-12 years, to create in a determinant year a little noise and change the value of those metals. The emergency method is to rise up the US dollar. But now you have to wait, its not the right time, yet. The list of firms in South African Republic and Australia is small and banks belong to a one person, though they are situated in US, Asia and Europe, but the largest of them is three international funds and two banks. But this is not the main goal of the game, the intent is more delicate and long-going, and somehow this is more known in Asian circles, but they are the ones, which will be shaken less."

Paper AvalancheBogus reason for SM sell off IMO#8641110/02/02; 15:55:28

OK, so Bob Pisani says that the reason for the free fall at the close was a result of a broker entering an order for five billion instead of five million shares of the s&p (SPY?). Sounds innocent enough. I guess the hapless schlep simply added an extra zero. But wait. A billion is three zeros more than a million. He must have inadvertantly hit the zero key three times. It happens all the time. CNBC thinks that because billion rhymes with million that the number of zeros will not register with Joe Sixpack. Sadly, they are more than likely correct. I invite all criticism to my quickly conjured up conspiracy theory.

Maybe the paper avalanche is closer than we think.

BoilermakerSector # 86409- Off Market Purchases of AU and AG?#8641210/02/02; 16:11:47

Verrry interesting. Your theory has credibility. Why not "source" the needed physical off market so that it can be used to support orchestrated selling? Of course this just robs Peter to pay Paul but it buys a little time until we can use the "war" to install more Draconian measures.
Paper AvalancheDow futures#8641310/02/02; 16:16:50

I may be reading this incorrectly because the Dow futures do not appear to have updated since 5:03 pm EST, whereas the other indices are updated, but, it appears that the Dow futures are down 207 points. Millions, billions, jillions, they all rhyme... there must be a simple reason. I am staying glued to CNBC for an explanation.


davefingerClerical error?#8641410/02/02; 16:21:06

Bear Stears Makes $4 Billion Mistake
October 02, 2002 6:10:00 PM ET

NEW YORK (Reuters) - Bear Stearns Cos. Inc. entered an erroneous order to sell $4 billion worth of stocks about 20 minutes before the closing bell on Wednesday, the New York Stock Exchange said.

The order was the result of a ``clerical error'' and should have been entered as $4 million, the exchange said in a statement. All but $622 million of the orders were canceled before execution, it said.

Bear Stearns told Reuters the error will have no material impact on the company and declined to comment further.


Carl H@Nibelung#8641510/02/02; 16:26:24

The densities of gold and platinum make them very difficult to fake. See the link above and interactive comparative density graph at:

Silver is another matter...only about half as dense as gold. I have been tempted to pull a couple of our 1KOz bars and drill them to see they have lead cores...nothing would surprise me.

AndúrilNibelung on the fool's gold#8641610/02/02; 16:34:14

Think about this.

Should the buyer be upset when bars are bought that only represent but are not gold?

The answer seems obvious. Why ask this question??

A parallel exists with paper alloy that the ruthless endorse to their brothers to extend their other paper games.

Listen to R Powell shortly ago: "Too bad we couldn't get that error prone stock market trader to order some gold and silver CONTRACTS."

While there continues to be gold buyers satisfied with "paper alloy" (endless supply!!) that only represents, at the same time those wise in the market will insist to receive instead the authentic metal for that same price!

Good for you and all that do!

BeowulfBank of New York Warns on Third Quarter #8641710/02/02; 16:37:49

The nation's big banks aren't due to post quarterly earnings for two weeks yet, but it's never too early for Bank of New York (BK:NYSE - news - commentary - research - analysis) to disappoint investors.

The nation's oldest commercial bank, echoing a warning issued last month by J.P. Morgan Chase (JPM:NYSE - news - commentary - research - analysis), warned Wednesday afternoon that its third-quarter profits will come in below expectations because of rising charges on bad loans to telecommunications companies.


It looks like a lot of banks are starting to have problems.


MKThe Second Largest Addition to the U.S. Public Debt in History#8641810/02/02; 16:39:34

On 9/30/02 the United States closed out its fiscal year. And what a year it was. Over $420 billion was added to the national debt. Just so the reader doesn't conclude that such a number is run-of-the mill, I add that the addition to the debt in fiscal year 2001 was $133 billion (bad enough but nothing like 2002, a banner year); and $18 billion in 1999 (that's right, no missing zeros here). To find a more debt sogged fiscal year, you have to go all the way back to 1992 (a recession year) -- the government rang up a cool $432 billion and a record addition to the public credit card.

The Federal Reserve itself purchased $82 billion of that debt with hot printing press money during the same period, or nearly 20% of the government issue.

This all fits well with Congressman Paul's quote (as published by Sir kasperjack):

"Should the dollar continue to decline in value, America will find itself struggling to service our already massive debt load
even as our foreign creditors become less interested in our dollars."

I'll take that a step further and say that would as interest rates trend toward zero, foreign investors will be increasingly reluctant to finance a debt issue that pays no interest -- thus withdrawing support from the dollar. This raises the essence of the developing Greenspan Dilemma. As James Grant (Interest Rate Observor) once said (going from memory): "<Of the major currencies,> only gold is not replicable on high speed printing presses."

Here's another one from the esteemed Mr. Grant (the lead article in his most recent issue titled "Low Interest Rate Peril"):

"<Low interest rates> have made supposedly predictable things uncertain, shaking the near-absolute authority the Chairman of the Federal Reserve Board. . . .What lies ahead? A lower funds rate and new chairman -- or at least, a newly chastened chairman."

It wasn't that long ago that the politicians were telling us about balanced budgets as far as the eye could see. So what happened? It can't just be war. The price tag being thrown around for a war in Iraq is $9 billion -- a spit in this $420 billion paper ocean. And it can't be the miniscule tax cuts none of us can even remember receiving. I don't we think we've had sufficient explanation where all this money is going.

BoxmanWest coast port situation#8641910/02/02; 16:48:43

Got this off of another board. Thanks to stylecounciler.

"Here in Wrong Beach, sorry, Long Beach,as of yesterday,the stalled
ship traffic due to the work slowdown/lockout was 10 miles down the
coast from the Port of Wrong Beach, oops, sorry, Long Beach. Today it
is another 10 miles down the coast, almost to the city of Newport
Beach. At this rate it's just a matter of days 'till the back up is
to the Mexican border."

Boxman:I can't even imagine what this must look like, especially from the air. I wouldn't want to be downwind from one of those ships carrying perisables. Trying to play catchup with the unloading will be a nightmare.

Beowulfwar on Iraq#8642010/02/02; 16:49:46

MK you stated:

"...The price tag being thrown around for a war in Iraq is $9 billion -- a spit in this $420 billion paper ocean."

The price I've heard is $8 Billion per Month. That's not a spit in an ocean. That's $96 Billion for 12 months, more if we lose aircraft at $35-60 Million each to replace. Lose a B-2 and your out $2 Billion.


RockI only have two words! #8642110/02/02; 16:57:32

GoldnSilver2002Boy oh boy somethin is brewing can ya just feel it!#8642210/02/02; 17:05:36

Well,the tide turns quickly,i wonder if gold was hammered down enough this time to keep her under 330 much longer?Clerical error?Must be real nervous about something!No wonder bush rushed this iraq thing,its all smoke and mirrors now.The bad numbers are going to keep rolling in,nervousness about war will set in as oil spikes upwards setting off inflation?All sounds good for gold doesnt it.From talking to my broker friends here in europe,its brutal and the lay offs are flying.MOst europeans are not sold on any of the u.s hype and the monied ones are aware the u.s dollar is about to tank.

Now we have strikes to contend with.I believe bush is doing the only thing he could given the circumstances he inherited'start a war,get government spending and keep peoples minds of how much wall st has lost them.This is a final attempt to kickstart the us economy as every other major economy shuts down ie germany(10 percent unemployment oh oh),japan,argentina,brazil,turkey...contries are falling like flies.Now to top it all off,bush may be about to destabilize the whole middle eastern region.Hmm 200,000,000
men,the kings of the east revelations i believe.Things are so bad Bush has adopted a "if ur going to hell keep right on going!" attitude because it must really be that bad!

I do not pretend to have a crystal ball but boy oh boy october looks like the beginning of something big!

MKBeowulf. . .#8642310/02/02; 17:06:02

You're right. $9 billion a month, according to the Congressional Budget Office. Even more to worry about, and not a spit in the paper ocean.
Sierra MadreSector: your post #86409 earlier today...#8642410/02/02; 17:12:46

With regard to TPTB purchasing gold and silver directly, for higher prices of course, in order to sell down both metals during trading hours and quite visibly.

Madness, of course, but it's not totally unbelievable. Wars are madness, yet they happen, and there IS a war on gold, and I consider that implies another parallel war on silver. Simply to buy time: it's better to die tomorrow, than today.

As Murphy says, We are getting close!" - I do believe it.

The hounds are barking at the heels of the manipulators. How glad I am not to be in their shoes!


OperativeBreaking From the Pack?#8642510/02/02; 17:15:33

Huge run up tuesday in the Dow. Today, Bear Stearns hits a "wrong button" and dumps a billion shares, or tries to. How about this idea? Bear Stearns has a horrific third qtr loss, and decides to take advantage of yesterdays run up and decides to break from the Fall St. pack by the huge selling late this afternoon to cover thier rear ends. All by accident you understand. <wink> Im sure Bear Stearns will buy them all back, at these super deal lower prices first thing in the morning. <uh huh>
G-khanSterling Silver Scam#8642610/02/02; 17:16:09

I just recieved word by Email from a dealer friend that the US is also launching an investigation of the Silver Scam. So it seems this baby has some legs and will get looked into. I don't know what or who started the US action but I suspect it may have come from Canada. They contacted me and asked about my tests and said they would contact US authorities about it... Good work Galearis

Silver is King

PizzLate day sell off?#8642710/02/02; 17:20:11

I was not able to watch the tape the last half hour today, but based upon my chart service and the action between 2:30 and 3:30, THIS EXCUSE is a crock of garbage.

The dow started selling off a little after three and at least twice was tried to be turned around with futures buying and failed. There was steady and consistant selling, and most was done before the last 20 minutes.

The reverse was happening in PM stocks, with what appeared to be fund buying (hedgers and XAU). Several times sellers tried to come in and cap the PM stocks at round numbers, and buyers came in and took the asks. There was some nice block buying and the bulk of the volume I saw was on the upside.

They may be trying to excuse it away for the masses, but my guess was there are a couple of hedge funds out there that are giving the PPT a real problem. Wasn't it Buffett that said last week they were going for elephants and the elephant gun was loaded???? Probably no connection, but I smell fear in the air.


kasperjackAnglo Gold Supports Mine Construction Strike#8642810/02/02; 17:27:54

AngloGold CEO Projects Growth Outlook For
Wednesday October 2, 5:21 pm E

-- Speaking at the Denver
Mining Investment Forum conference today,
AngloGold (NYSE:AU - News) CEO
Bobby Godsell announced that the company was on
track to produce 6 million
ounces of gold in 2002 and that AngloGold was
looking to increase production
over the next three to four years to a possible 6 .5
million ounces as anticipated
expansion projects come on stream.
The WA boys are going to have to ante up a further few more hundred tonnes per year or else...

Sierra MadreCharles Savoie's excellent article: just one observation...#8642910/02/02; 17:28:39

I raise one lone and unimportant voice, which will be of absolutely no use, except that certain things demand being stated.

The war brewing or in process is not, fundamentally, between the Christian West and Islam, as it was centuries ago. Christianity is no longer willing to send martyrs to their deaths in a religious crusade. Everyone knows this.

The churches in Europe are EMPTY.

Who are the contenders in this coming war?

The contenders are a Judaized west, ex-Christian, now run, at least in the case of the U.S. according to Ariel Sharon's own statement, by Israel.

This is not "the Christian West against Islam", by any means.

It is Judaism against Islam. Once again, Christians will be cannon fodder, the Falwells and Robertsons leading them on.


OperativeThe New US-British OIL Impire. #8643010/02/02; 17:30:39

An interesting read that may provide some explanations to what is going on with oil and the middle east.
OperativeThat would be Empire, #8643110/02/02; 17:32:41

sorry about that.
Nibelungoperative#8643210/02/02; 17:35:18

Good comment about Bear Stearns "accidentally on purpose" making the mistake to pull some chips over to their side of the table !
NibelungPaper avalanche#8643310/02/02; 17:57:15

Very good point about an accidental one vs. three extra zeros.

Sure glad we've got those reliable media watchdogs out there to get to the bottom of things and give it to us straight !

jlfletc(No Subject)#8643410/02/02; 18:24:43

Sierra, you're so full of poop....... For someone who's always harping on others to stick to the subject, you sure don't seem to mind venturing from it yourself.
R PowellAnduril#8643510/02/02; 18:40:05

The contracts are a paper game settled in fiat, nothing more, nothing less. If you want real, physical metal, call our host. If you care to play the paper game, enter at your own risk.

However, if you would like to see the POG move higher in dollar terms, you will have to see the contract prices in the paper game move higher. It's called arbitrage. If the system fails entirely, be glad you hold physical but, last time I looked, it was working fine with 98% fiat settlement. As M.K. has mentioned, the Comex has never defaulted to his (or my) knowledge. It is a "paper alloy" and there is an "endless supply" so beware!!

AndúrilObserving R Powell#8643610/02/02; 19:03:23

You will not understand if you try only to justify.

Your fate lies with you.

R PowellAnduril#8643710/02/02; 19:28:59

It would indeed be nice if the world were the way we wish it to be. I do not endeavor to justify but rather I try to understand and evaluate fact and opinions. I also try to profit from knowledge. Justifying gains me nothing.
I have acquired physical but I do not join the physical camp to the exclusion of the reality of the economic workings of the world.
There is a quaint religious custom called "shunning" exercised toward that which is no longer recognised by the righteous. It doesn't change reality but reality does effect the world and everyone in it. Shunning also doesn't work well with rattlesnakes. Ignore that which you dislike at your own risk. Unfortunately, if gold is the subject, gold markets must be considered.

GaleriderWATCHING#8643810/02/02; 19:59:16

Spot is hanging in there and NIKKEI is trying hard to stay above 9000. They do not want it to drop below the 9000.
AndúrilRPowell selective consideration#8643910/02/02; 20:08:43

Why then do you choose not to consider the experience of these markets? Are you unaware that rules you play by today have been written and rewritten as pressured by the need of failing counterparties? Can you not grasp that these adjustments come about mid-game to affect the outcome? By their motivation and design they do not come thoughtfully after you have taken profits. They visit you to share the losses. Those who saw many millions in direct and opportunity losses at each end of the 70s decade from real experience will laugh sorely now at your misplaced blind confidence -- an echo of their past naïve errors.

So it is written for a reason... on paper; not carved in stone.

BlackjackGolden Knights prepare to storm the $325 Maginot Line#8644010/02/02; 20:16:44

While the $325 Maginot Line has held against all gold's assaults since 1998, it is exciting and encouraging to see from where each subsequent attack has been launched. Rather than viewing gold's attempts on $325 as the army of golden knights being shattered and fleeing, it may be more appropriate to view gold's skirmishes as scouting missions. With the longer-term perspective offered above, it almost appears as if gold is systematically probing the heavy $325 resistance bulwarks, sending out elite raiding parties to gather reconnaissance data and report back on exploitable weaknesses.
Since 1999, each subsequent assault on the $325 fortifications has been launched from higher and higher levels. The gold bulls, rather than fleeing in terror when fired upon by the bearish sellers at $325, seem to be gathering strength and camping closer to the battlefront each time as their boldness and courage grows.
As the white lines in the graph indicate, there is relentless ascending wedge forming between gold's trading range and the strong resistance at $325 gold needs to pierce to keep the young gold bull alive and rallying. Like a compressing spring, the wedge pattern exerts more and more force on the $325 Maginot Line each week as the distance between the primary gold uptrend and $325 constricts.
Way back in 1999, the spectacular Washington Agreement spike needed to rocket up by an enormous $70 or 27% to take a shot at breaking $325. The first attempt this year however, #4 above, made a raid on $325 by only rallying $21 or 7%. As gold's strategic uptrend thrusts it higher and higher, ever more buying pressure is applied to the heavy long-term resistance line. Soon the golden armies will probably be storming the very gates of the fortifications and the seller garrison manning the guns may flee out of the sheer terror of seeing gold completely unintimidated by the $325 Maginot Line.
As the wedge relentlessly closes, gold's invasion is advancing and growing bolder with each attempt. A breakthrough to new gold heights is all but inevitable!
Canada reports inflation on the rise due to food and energy costs.
No such news for the sheeple in the US. World economic news
is grim from chips to ships lined up for miles down the west coast.
Perhaps Lili is the event that completes the perfect storm?

TrapperSir neblung and all#8644110/02/02; 20:19:35

RE fake gold etc.

The jewlery industry has and does use brightners in gold to make 14k look like 18k etc., but I have never heard of the process of which your poster speaks. This is one reason I stick to coins.There were some fake K-Rands many years ago so some folks made a coin sizer. There are mostly plastic but there are some very good metal ones on the market.You just slide the coin through and if it passes you weight it. They are cheap and you can find ad in places like coin magazines or ads in the grey and blue sheets.
But what a toll for the cabal headlines " all your ag, au, and pt are fake" that would thake the wind out of a big rally quick. Live small and it is nor paranoia when they really are out to get you.

sectorNew Orleans Gold-Bugs...Lili Turning North [Infra-Red Imagery]#8644210/02/02; 20:21:11

The link reveals the last 15 minute position of the cloud tops in white and the dry air in black.

The track seems to be right at New Orleans.

Pray for the souls.

axBobby Godsell Bullish on Gold Price#8644310/02/02; 20:40:10

In an interview with Tim Wood of Mining Web today from
the Denver Gold Conference, Bobby Godsell CE of Anglo
Gold said in part:

"...Just how bullish are you on the gold price?
BOBBY GODSELL: We think the price risk is now on the upside. We have
never attempted to call the market. However in terms of the fundamentals
of supply and demand gold was clearly over sold at $250, and equally
clearly with future production trending down there is upside in the
current price."

OperativeNo Stone Unturned#8644410/02/02; 20:41:10

The above link is one of those I hesitate to post because it is obviously fringe element writings. Yet, in the ongoing search for what is really going on in our world there may be some here that can find a tidbit of solid information contained within.
Black BladeDebt Bubbles – Market Wrap Up - Puplava#8644510/02/02; 20:49:49


The consequences are now unfolding as corporate defaults keep setting new records. Even more worrisome has been the downward spiral in corporate profits. It is profits and the cash flow from an enterprise that supports those debt payments. With profits in decline bankruptcies are rising. According to the Commerce Department's latest revision of non-financial business profits, they fell from $504.5 billion in 1997 to $333.7 billion in 2001, a drop of 34%. By the first quarter of this year they fell by 42%. This is an unmitigated profit disaster and goes a long way to explaining the now rising trend in corporate debt defaults. Strangely this is given little attention in the financial press. The media and Wall Street tend to remain fixated on pro forma earnings per share, which are absolutely meaningless. In fact, all of the actual forecasts for a strong economic recovery and the constant blather on what great shape the American economy is in completely ignores this debt phenomenon. The more credit that is created, the more debt that business and consumers take on, which is applauded. The fact that very few analysts or economists pay any attention to this matter is of even greater concern.

Our economy and financial markets have run on debt so long that the consequences of a debt implosion are outside the radar screen of most analysts. Only when you get a spate of defaults, such as what we had at the beginning of the year, does it make front-page news. As quickly as it grabbed attention, it has just as quickly faded away. Yet the growth of debt related to income goes on unabated. For example, in 2001 personal income grew by $386.3 billion while personal debt expanded by $614.6 billion. During the bubble years of 1995-2000 household debts grew by $2,164 billion in comparison to household income, which grew by only $1,675 billion. Personal savings in this country are 0.2% of GDP. Americans don't save; they just borrow money.

Black Blade: Exactly what I have been harping on for quite a long time. The chickens are coming home to roost and the fox guarding the hen house is in for a surprise because these chickens have been bulking up on steroids. Corporations and consumers are swimming in unmanageable debt that will never ever be repaid. Welcome to the New Great Depression. As always and once again – get out of debt, stash enough cash for several months expenses, accumulate Gold and Silver portfolio insurance, and start a storage program of nonperishable food and basic necessities. When the excrement hits the bladed wind device, it's going to get beyond very ugly.

Black BladeUS credit quality down near-record#8644610/02/02; 20:58:47


NEW YORK, Oct 1 (Reuters) - The creditworthiness of U.S. companies between July and September sank for the 18th straight quarter, one shy of the record, as investors grew warier of risk and credit markets tightened, Moody's Investors Service said on Tuesday.

Black Blade: Yeah, that's about right. Now that debt levels are at all time record highs it's a perfect time to downgrade debt and put the screws to US businesses. Turn out the lights – the party's over.

CytekFirst time posting#8644710/02/02; 21:09:32

This is my first time posting at this site, been reading it since 99' thanks to a buddy i work with ( Dragonfly),who turned me onto this site, not only for good discussion but purchasing bullion also.

I just have to say that you guys are great! I totally enjoy the comments and feel like i know most of you and look forward for what you guys have to say regarding the HOT event going on somewhere in the world.

I have been saying this for over a year and still believe as most posters here that JPM is the stick that will break the Camel's back and set into motion an unraveling of the markets that history has never seen before.
Here is an interesting article i read this evening , thought i would pass it on.

As the assets crumble
So the deal now is that, at a market capitalization of $38 billion, JP Morgan is trading below its book value. This is a sign the market expects a company to destroy equity in operations, not grow it. This is precisely what has taken place as every single big financial disaster this year seems to have JP Morgan sitting in the middle: Enron, WorldCom, Adelphia, Global Crossing, Argentina, Kmart, Brazil. And in the most recent installment, JP Morgan wrote down $1.4 billion in non-performing assets, blaming bad loans to the battered telecommunications sector. Even so, JP Morgan maintains a reported $8 billion exposure to telecoms. Which loans did JP Morgan write down? They don't say.

There is a basic truism about banks. It is nearly impossible for an outsider to determine what credit risks the banks face until it is too late. There is an old adage: "No loan ever looks bad on the day it is signed." Just so, one of the scariest things for an investor to see is a bank that is trying too hard, being too aggressive. In the boom years, it seems that JP Morgan was among the most aggressive in lending money to telecom and cable companies, a great strategy when everything high tech was going up. When the weather turned, it seems JP Morgan was the company farthest out at sea. JP Morgan just had its credit rating downgraded to A+, which is still high. Any further credit rating downgrades could, however, put it in a spiral of non-compliance.

I got gold


Gandalf the WhiteWELCOME Sir Cytek !!!!#8644810/02/02; 21:19:17

Cytek (10/02/02; 21:09:32MT - msg#: 86447)
First time posting
Thanks for the thoughts on JPM. The Bank that Goldhearts have learned to hate !

Black BladeCycles of Silver: Global Economic Unity through the Mid- Eighteenth Century#8644910/02/02; 21:24:54

One for the Silver Bugs - A long but interesting article on monetary silver history.


This essay focuses on two significant cycles in the evolution of the global silver market. The first phase-the Potosi /Japan Cycle-spans the 1540s to the 1640s and generated the birth of global trade (as defined below). A second silver phase-the Mexican Cycle-covered the first half of the eighteenth century and was related to significant demographic growth in China that was partly attributable to the introduction of new crops from America. Analysis of these two silver cycles bolsters our dual contention (1) that a highly integrated global economy has existed since the sixteenth century, and (2) that all analyses of world regions must recognize powerful, interconnected economic, demographic, and ecological forces that have been operating at the global level for several centuries.

Black Blade: Happy reading.

Black BladeAsia Awash In Red#8645010/02/02; 22:43:25

Asian markets sink into negative territory and the Nikkei 225 breaks into sub 9,000. Looks a little ugly in Asia and the fun could continue into Europe. Just can't wait to see what the Lemmings will do in Europe. Will they turn away from the edge of the cliff or will they plunge over? Get some popcorn and grab a cold one (I'll take a Negra Modelo myself) as we watch the fun.

- Black Blade

goldquestBad News Stacking Up#8645110/02/02; 23:01:07

Will Goldman Sachs be the next big scandal? Will Martha go to jail? Standby as Wall Street turmoil increases!
AllanCWhat a guy#8645210/02/02; 23:03:33

Black Blade

"Get some popcorn and grab a cold one (I'll take a Negra Modelo myself) as we watch the fun."

You really have a strange sense of humour...but I like it.

BlackjackWorld's Biggest Bank (Mizuho) DROPS 15% EGAD!#8645310/02/02; 23:21:14

Mizuho and UFJ, the two most active stocks by value, had their biggest drops since they first started trading. Mizuho, the world's largest bank by assets, sank 15 percent to 214,000 yen. UFJ, Japan's No. 4 lender, tumbled 15 percent to 229,000 yen.

Minister for Financial Services Heizo Takenaka may today announce the line-up of a task force he's assembling to speed bad- loan disposals, igniting concern Japan will push banks to cut off their weakest clients.

Seven of the nine stocks that declined the most yesterday on the Tokyo Stock Exchange's first section, including Hazama Corp., Daiei Inc. and Tomen Corp., counted UFJ or Mizuho as their biggest creditor.
Crunch Time with Japanese Banks soon.
Nikkie under 9,000 right now.

HoratioDecennial Pattern is right on schedule#8645410/02/02; 23:24:12

In the world of cycles there is one I follow that is tracking exactly as predicted.The per cent predicted for Oct is 100 % down market probability.80% down probability for Nov.and Dec.
Most of 2003 has a downward probability ranging from 30 % to 80 %,until Oct of 2003,where the decline is mostly spent out and returns to a positive %.Another weather cycle that correlates to stock prices states the % of rainfall deviation from the norm will accompany an equal deviation from the norm in stock prices.All this from a book written in 1939.So far its right on target....

BlackjackUK Business failures on the rise#8645510/02/02; 23:27:12

LONDON (Reuters) - The number of business failures rose 5.5 percent to 11,088 in the third quarter of this year from the second, the worst tally for three years, a survey by consultants Dun & Bradstreet (NYSE: DNB - news) shows.

And the number for the first nine months of the year was up 7.3 percent on a year earlier to 32,906, D&B said, also the worst performance for three years as continuing fears of economic slowdown caused more companies to close their doors.

"Last quarter we had strong hopes that the rate of business failure in Britain had started to decline. I believe it would have done so but for worries about the continuing slowdown in the UK and other European economies," said Philip Mellor, senior analyst at D&B.

"Over the next three months the situation might well get worse due to a reduction in consumer spending as fears of unemployment grow," he added.

The survey, released on Thursday, showed that the West Midlands, with a rise of 15.8 percent, and the North West of England were the two worst hit regions in the latest nine months, with the number of insolvencies in both areas at its highest for a decade.

The South East and South West also saw rises of over 10 percent while London saw an above-average increase of 8.3 percent in the first nine months of the year from a year earlier.

The only two regions which enjoyed falls in the number of failures were the East Midlands, with a drop of 3.7 percent, and the North East, with a fall of 0.4 percent.

Overall big business were worse hit than small ones, with bankruptcies in the first three quarters up 11.9 percent and 4.1 percent on the year respectively.
No recovery here. Debt, debt and more debt.
Got Gold & Silver

Black BladeRe: AllanC#8645610/02/02; 23:28:00

Ah you know how it is. When handed lemons – make lemonade. Sometimes it is just easier to let natural selection take its course. In this case it reminds me of the old peanuts cartoon where Charlie Brown (investors) is goaded by Lucy (Wall Street trolls) to kick the football (stocks) only to have Lucy pull away the football at the last second resulting in Charlie Brown falling flat on his back in agony. Time after time we see the investor take a beating and like a masochist keeps returning for more even though he knows the outcome. In today's economic environment it doesn't take a rocket scientist to realize that the economy is in deep trouble. Yet instead of taking precautions as they should, investors want to kick the football even though they see Lucy giving them that sadistic grin and knowing that she will once again yank away the football. So I just figure it is a twisted sort of entertainment that I will observe until that inevitable ending is written. Cheers!

- Black Blade

Black BladeSpeaking of Human Nature#8645710/02/02; 23:40:46

Speaking of human nature, late this afternoon I am sitting on the side of a canyon in fading light while looking through the crosshairs and I suddenly have a tough time holding the rifle steady. I find myself laughing almost uncontrollably as I try to imagine the frenzied scene at Bear Sterns after they suddenly realize that they just mistakenly punched the sell button to the tune of $4 billion and precipitate a market crash. Oh well, humor is means different things to each of us.

- Black Blade

BlackjackBBC : Fear Grips Japan's Banks#8645810/02/02; 23:48:21

Only days after Japan's foremost economic reformer was given a free hand, the euphoria about the chances for real change is waning.

Heizo Takenaka, appointed financial services minister on Monday as well as keeping his job as economics minister, has kicked off a top-to-bottom review of banking policy.

But while investors are sick of the trillions in bad debts crippling the banking system and want reform, they are also scared that the pain caused by any cure could be unbearable.

The result: a mass selloff of banking stocks on Thursday, driving the benchmark Nikkei down below the key 9,000 level to 19-year lows as fears of a 'hard landing' grow.

By 0500 GMT, the Nikkei was down 0.75% or 67.85 points at 8,981.48.

Global selloff

Not all the declines could be put down to concern that the government will force banks to accept public funds in exchange for more honesty about their problem loans.

Heavy falls on Wall Street overnight had accompanied bad news from a string of companies, including chipmaker AMD which warned of rising inventories and falling sales - a worrying echo of the situation as the tech boom turned to bust two years ago.

The Dow Jones index had ended the session in New York down 2.3%, with the tech-heavy Nasdaq Composite down 2.1%.

But the main influence was undoubtedly the banking worries, exacerbated by news that former central banker and key reformer Takeshi Kimura is to join Mr Takenaka's new banking task force.

Of the four biggest banks in Japan, the largest - Mizuho - and the smallest, UFJ, were worst hit by the selloff.

Both fell the full extent of their daily limit, or about 15%.

The extent of concern about Mizuho and UFJ was demonstrated by the fate of shares in the other two big players in the banking sector.

Shares in Mitsubishi Tokyo Financial Group and Sumitomo Mitsui both fell by much smaller amounts.
Mizuho was down the limit WOW

GaleriderHORATIO ......PATTERNS#8645910/03/02; 00:00:04

Horatio.....what is the name of the book please, sounds interesting
BlackjackGoldman helped director flip IPOs!#8646010/3/02; 00:08:19

NEW YORK (CBS.MW) - Goldman Sachs allocated hot IPO stock to some of the nation's larger corporations while receiving substantial investment-banking fees from the very same companies during the technology boom, according to a published report.

Executives from two high-profile Goldman clients, EBay's (EBAY: news, chart, profile) CEO Meg Whitman and Yahoo's (YHOO: news, chart, profile) co-founder Jerry Yang, were granted shares in more than 100 IPO's managed by Goldman since 1996, the Wall Street Journal reported in its online edition late Wednesday.

The executives flipped the stock for quick profits, according to congressional investigators cited in the story.

The House Financial Services Committee provided data regarding similar activity among other notable executives such as EToys CEO Edward Lenk and (TSCM: news, chart, profile) director Martin Peretz.

Eight of the 22 Goldman-led IPOs delivered to executives rose at least 173 percent on their first day of trading, the committee said. Many of these recipients sold their shares immediately after the stock opened for trading.

A spokesman for Goldman described the report as "an egregious distortion of the facts," the newspaper said.

Goldman Sachs joins Salomon Smith Barney and Credit Suisse First Boston in the glare of regulatory and congressional scrutiny.

Shares of Goldman Sachs (GS: news, chart, profile) closed down $2.90 at $65.55.
I wonder if Cramer was flipping IPOs?
This is going to get very entertaining!

Black BladeAsia Awash In Red and Europe Starts Off Ugly#8646110/3/02; 00:37:36

Asian markets crumbled across the board and Europe looks to open in the red as well. The Asian lemmings dove off the cliff and the Euro Lemmings appear to be geared to do the same. Should get to be quite "fun" tonight. It should be interesting on Wall Street tomorrow as the market absorbs a string of after hours earnings warnings and hurricane Lili smashes into new Orleans. Yep, looks like Lili is slicing to the left and with the storm surge bearing down on a city that sits below sea level, well all I can say is - "interesting".

- Black Blade

davefingerThanks Blackjack#8646210/3/02; 00:47:17

Your post made my night. Looks like Cramer has his own 'cesspool' to swim around in after all. Oh I can smell the irony hehe.
Black BladeHurricane Lili#8646310/3/02; 00:48:24

Hurricane Lili is bearing down on New Orleans with gusts up to 165 mph and storm surge up to 20 feet. The effects will be felt on declining oil production, refining, and declining inventories for at least the next four weeks. Also, tropical storm Kyle is starting to stir off the east coast.

- Black Blade

Black BladeHurricane Lili - Photo#8646410/3/02; 00:54:24

This satellite image is in color.
BlackjackRadar from New Orleans showing storm#8646510/3/02; 01:06:18

This looks to really test New Orleans.
If the tidal surge is big, it could really
do a lot of damage. They say the NE quadrant
is the worst part.

Black BladeHurricane Lili - Photo - Latest#8646610/3/02; 01:09:04

This is the latest image. This could be the "big one" that New Orleans has always dreaded. The costs will be enormous and the hit on the Gulf economy will be devastating. The hurricane is headed right into "refinery row".

- Black Blade

BlackjackUnemployment to rise#8646710/3/02; 02:01:52

Friday the government is to issue its monthly employment report. The jobless rate probably rose to 5.9 percent in September, based on the median of 59 forecasts in a Bloomberg News survey of economists. The economy probably created 7,000 jobs last month, the fewest in five months, the survey found. In August the unemployment rate was 5.7 percent.

Unemployment may rise even more by the end of the year because of continued job cuts. SBC Communications, the No. 2 U.S. local-telephone company, said last week it would cut 11,000 jobs by 2003 as it loses customers to rivals. Bombardier, the largest maker of trains and small planes, also said last week it would fire 1,980 aerospace workers as corporate travel falls.

And Fidelity Investments said Monday it would eliminate 1,695 jobs, or 5.4 percent of its workforce, after 2 1/2 years of falling stock prices thinned assets under management at the biggest U.S. mutual fund company.
Bone Pile set to Rise

Old YellerThe Fed,FNM and USTs#8646810/3/02; 02:05:36

Interesting read from Roger Arnold.
slingshotSiege Engine#8646910/3/02; 02:53:11

Gold above $300.00

The leaves of the trees that were vibrant green were turning color. Shadows cast upon the ground were longer as the days light shortened to keep in tune with the order of the universe. The air was crisp and had the smell of change.

The Lords castle has now become the citadel of the Goldbugs. The Mighty Oaken Table of Yore the focal point for discussions of past battles, present activities in the land and their future concerns. They have been at peace for a short time but knew soon they will again be on the march.
The two cannons Draco and Smaug were returned to the Valley of Clouds as per Gandalfs request and Gold once again became the currency of their land. Stephen the Great, shared more than his Gold. He brought forth the bounty of the Valley of clouds. Fruit,vegetables,wild game and fresh water in abundance. New friends and customs to be enjoyed by all.

Although the Goldbugs were prospering, the council had fears for the future. Again the Lord of the castle would be summoned before them. The anger now subsided he stood before them without chains. This little man stripped of his power, smiled. Sir Black Blades eyes flashed and drew his sword. Stop! Sir Howe said. By his show of arrogance he must have something to tell us. Why else would he risk his life.

I do indeed have much to tell you'said the Lord of the Castle. More than you may want to hear.
I have heard my guards talk of your battle with the King with No Name. Impressive plan. You did not find the Gold or King did you? The Lords face was like stone and he drew closer to the table. Did you see the emblems of those who have fallen in the stonework of the courtyard? Do you not know that my brother and others are on the march to free the King from his tomb? That is why I stand before you. But I tell you this should be of little concern to you. For at this moment, there is a power growing who also has an interest in GOLD. A confederation bigger than Rome itself. It soon will make it presence known.

The Lord again grinned and stepped back and the guards took hold of him.

Remember what I have said here, for it will come to pass. In time the King will have your heads!

Return him to his cell'said Sir Howe. Turning to the rest of the council after the guards left with the Lord he again spoke. He will tell us more, for he wants to.

The council talked into the night and two riders dispatched to the Kings castle.

SteveHSo, smart posters, what say you re: this theory#8647010/3/02; 03:15:24

Black Blade"Barbarous Relic Files" - Fleeing Miami Robber Leaves Behind His Gold Teeth#8647110/3/02; 04:10:25

MIAMI (Reuters) - A man dubbed by authorities as the "bumbling bank robber" had his two gold teeth knocked out as he ran into traffic and was hit by a van while fleeing a heist, FBI agents in Miami said on Tuesday. The suspect, who also may have shot himself accidentally, escaped in a waiting get-away car but police recovered his teeth from the street and held them as evidence, the FBI said. The suspect walked into a Wachovia Bank branch in North Miami Beach on Monday, pulled a gun from his pocket as he approached a teller and demanded that she fill a bag with money, the FBI said. The teller gave him an undisclosed sum of money and he turned to flee, discharging the gun as he stuffed it back into his pocket, the FBI said. "It is unknown at this time if the robber shot himself when the gun discharged," the FBI said in a statement headlined "update on bumbling bank robber." The suspect ran out of the bank into the street and was hit by a white van and dragged under it, authorities said. He managed to get up and run to a waiting car that sped away, leaving his teeth behind, the investigators said. Police and the FBI were looking for him at hospital emergency rooms and medical centers. The suspect was described as a tall, thin black man in his late 20s to early 30s.

Black Blade: I might add to the description a thin black man with either two gaps in his teeth or one big one, a nasty limp, and signs of road rash. Then again the teeth are often described as "barbarous relics" and therefore this qualifies for the "Barbarous Relic Files". Hmmm…

Black BladeHurricane Lili Downgraded To Category 3 as Gulf Coast Region Braces #8647210/3/02; 04:39:50


NEW IBERIA, La. -- Hurricane Lili whipped toward land with 120 mph winds Thursday, posing such a threat that authorities urged nearly 500,000 Gulf Coast residents to flee ahead of a storm that is one of the strongest to hit the region in recent years. The storm shut down the region's resort towns, all 12 of Mississippi's Gulf Coast casinos, NASA's Mission Control in Houston, the nation's biggest oil import terminal, and a Tabasco bottling plant near the Louisiana coast. Early Thursday, Lili weakened to become a Category 3 storm, with winds of 111 to 130 mph. The hurricane's eye was about 95 miles south of New Iberia, La., which is about 140 miles from New Orleans, heading toward the marshy coast at 17 mph. Landfall was likely to be between New Iberia and Morgan City by late morning, a hurricane center meteorologist said.

Black Blade: Lili has been downgraded and has shifted slightly west so it looks like New Orleans may be spared. Another note of interest is that in 1992 hurricane Andrew toppled 13 drill rig platforms. This time the hurricane is ripping through a concentration of platforms and there are 954 drill rig platforms in the Gulf. The area produces nearly 25% of the nation's NatGas and oil. Also, it is expected that the storm will cause several $billion in damage and the insurance industry will take a severe hit, though the insurance industry is immune to flooding claims. Some ranching, poultry, and farming (especially rice) will be destroyed as well.

Black BladeHundreds Of Thousands Told To Flee Hurricane Lili #8647310/3/02; 04:51:33


NEW IBERIA, La. (AP)--Nearly a half-million people in Louisiana and Texas were urged to clear out on Wednesday -some of them for the second time in a week -as a fearsome Hurricane Lili barreled toward the Gulf Coast with 140 mph winds. "We have a real disaster in the making," said Max Mayfield, director of the National Hurricane Center in Miami. "This is going to be the worst hurricane to hit the Louisiana coast since reconnaissance data has been available" since the mid-1940s. Resort towns boarded up, along with all 12 of Mississippi's Gulf Coast casinos, NASA's Mission Control in Houston, the nation's biggest oil import terminal, and the Tabasco bottling plant near the Louisiana coast. Lili was expected to come ashore in Louisiana on Thursday morning as a major, destructive hurricane, Category 4 on the five-point scale. Forecasters warned that some areas could be inundated with 6 to 10 inches of rain and a life- threatening storm surge of up to 20 feet. Nearby, Port Fourchon was also shutting down and evacuating. An estimated 16% of the nation's crude oil and 17% of its natural gas come from rigs and platforms that require access to the port. LOOP, the Louisiana Offshore Oil Port about 20 miles off the coast, also closed. It is the biggest U.S. crude oil import terminal, handling about 1 million barrels of crude a day, or 11% of U.S. imports.

Black Blade: Even though winds died down to 120 to 130 mph it is still a potential disaster that could create havoc for the U.S. economy for weeks. Strangely oil and natgas prices are unaffected and have even declined while market index futures are surging higher. This stock and commodities markets is really out of whack.

SlowmanSilver#8647410/3/02; 05:47:04

Often I get a gut feeling to try to figure out what is happening in this market. This week I decided to do some phone research on silver. Needless to say, I , called a personal friend who runs a multimillion dollar fabricating plant for silver bars. He has one customer that is taking 20,000 ounces of silver a week. Thats great for us BULLS !!
We then talked about what is comming into his place of business relative to silver. He confirmed my conversation with others that almost nothing is being sold by the public.
He went on to say that he has to buy from the New York and Chicago commodity exchange to get what he needs. So far, he has no problem getting delivery.
Now, I know he sells lots more than this little 20,000 per week as he runs ads in Numismatic News and Coin World all the time. Plus he does tremendous business on t.v. home shoppers type for coins.
IF BUTLER, is correct about a silver shortage and I believe he is, WHERE IS ALL THIS COMMING FROM ???? Personally I bought more CDE based on my research. However, do your own D and D as this is not a recordmendation for or against. I simply pay my dues and take MY CHANCES.
BEST OF LUCK TO ALL!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

OperativeNo Recovery Soon#8647510/03/02; 08:25:52

Oct 3, 2002

New Claims for Jobless Benefits Rise;
Factory Orders Flat

By Jeannine Aversa
Associated Press Writer

WASHINGTON (AP) - More Americans filed new claims for jobless benefits last week, a fresh
sign of the difficulties workers and companies are confronting as the nation's wobbly
economy struggles to keep its balance.

The Labor Department reported Thursday that new applications for unemployment insurance
climbed by a seasonally adjusted 5,000 to 417,000 for the work week ending Sept. 28. The
increase was slightly larger than analysts were predicting and followed a drop of 18,000 in
the prior week.

In another report, orders to U.S. factories were flat in August as a drop in demand for costly
manufactured goods was offset by a rise in orders for "nondurable" items, such as food and
clothes, the Commerce Department said.

Even though factory orders were unchanged after jumping by 4.4 percent in July, August's
report was better than the decline that analysts were forecasting. Nonetheless, a more
forward-looking report released earlier this week on manufacturing suggested that this
sector of the economy was stalling.

In the layoffs report, for six weeks straight new claims for unemployment benefits have been
above the 400,000 mark, a level associated with a sluggish job market.

OperativeFailed Enron Project Now A Study In Bad Government...#8647610/03/02; 09:07:07

What a corrupt mess we now naviagate in. I think soon Webster's will have to remove or redefine words like honesty, truth, transparent, etc. I am also beginning to wonder if anything of major size or accomplishment is not rigged or staged. My own awakening to understanding is not revealing a very pretty picture. I question if things will ever return to "normal". I think the guys in white hats have left the planet.
CoBra(too)PDG - That's Placer Dome - #8647710/03/02; 09:23:48

With a Capital "P" as in Pinocchio, who's nose got longer with every half truth, id est lie, or is it?

In my, admittedly very poor memory the PDG hedge-book was about double the size they claim in the article. That would bring it to over 14Moz hedged.

Well, either my memory is totally corrupted - or Placer Doom has two seperate books. Just a suggestion, of course, though I seem to remember clearly that the February of 2000, following the "WA", PDG has initiated a second spike over 300 with a closing hedge news release. I also remember being totally mesmerized, not to say shocked, by the then hedge positions, which seemed to have doubled from the previous Qu. at that time.
It may well be that I'm getting my #'s totally wrong and either I or the gold market has missed this would be miracle - so I'll check! In any case even the 7.2Moz is still 2.5 years of (falling) production.

And every other major producer and his junior brother tells the Denver Gold Conference that they're reducing their hedges rapidly.

Do you see the short squeeze? After all the miners collateral is real physical gold to be produced in the future. At the same time the same gold borrowed by the most prestigious addresses, now cripple A rated, and sold effectively, physically into a market already severely short of the real supply.

No way! It's just papering- and rolling over, to cover the tracks of the physical shorts and buy some more time in order to extend the charade.

Sad, but true feels cb2

MKStagflationary Economic Action Spells "Opportunity" for Gold Investors#8647910/03/02; 10:01:43

Stagflationary Economic Action Spells "Opportunity" for Gold Investors
Dollar Erases Losses on Stronger-Than-Expected Economic Reports
By Geraldine Ryerson-Cruz

New York, Oct. 3 (Bloomberg) -- The dollar erased its losses against the euro and yen after an industry report showed U.S. service businesses, the biggest part of the economy, expanded at a faster-than-expected pace in September. U.S. stocks rose, bolstering demand for dollars, as a government report showed orders placed with factories in August were also stronger than forecast. The reports eased concern that the recovery in the world's biggest economy was faltering. ``These were very impressive numbers that indicate the U.S. economy is not as bad as people thought; therefore the dollar and equity markets are catching aggressive'' demand, said Joseph Barnea, a currency trader at Bank Leumi USA. ``The market had been setting itself up for significantly lower'' numbers, he said.

MK Comment: The American economy might be in better shape than some economists believe. If so, potential gold investors should view this turn of events as a reprieve and opportunity. If we are not going to descend the depths of a depression than where are we headed? Many economists think that we are on the verge of an international stagflationary trend reminiscent of the 1970s. We subscribe to that theory as well. If that's the case, those buying gold now will find themselves at the vanguard of a major bull market -- sitting on a cache of gold they acquired at bargain prices. Buying gold now at under $400 is like buying under $40 in the late 1960s, early 1970s. And we believe that returns might be equally impressive over the medium to long term. Don't be a cash turtle in this environment -- you may end up in the stagflationary soup.

MK Advisory: Contact George Cooper (Ext 102), Jonathan Kosares (Small Order Desk, Ext 110), or myself (Mike Kosares, Ext 101) if you have an interest in starting your gold acquisition program. There are some good opportunities in the market at the moment in both bullion items and pre-1933 European and U.S. gold coins. Volumes were very strong in September for reasons most of us are aware. Don't forget that this October -- the cruellest month in the markets -- and we expect it to produce the usual run of October suprises.

USAGOLD / Centennial Precious Metals, Inc.Put a Foundation Under Your Portfolio#8648010/03/02; 10:13:52

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USAGOLD / Centennial Precious Metals, Inc.Hard assets... Easy access!#8648110/03/02; 10:34:34

"'Good as gold' speaks only of yellow metal:
a Truth lost as often as money
by players in leverage, credit banking systems, and Ponzi schemes."

-- R. Strauss

Mr GreshamSteve H#8648210/03/02; 11:12:22

The Arnold post you got from kitco pretty much matches up with Antal Fekete's essay about the Fed's primary clients being the banks and bond speculators, now as during the 30s Depression. Whatever happens to the rest of us is clearly secondary to what remains of its mission. Perhaps AG has done the most realistic analysis of what he can do to get the most leverage out of its remaining bullets, but the rest of us will be collateral damage under almost any outcome.

Thanks for bringing us the link to a good read.

AristotleHere's a challenge to everyone#8648310/03/02; 11:52:13

There are so many merits to Gold in the grand financial scheme of things. The challenge is for everyone to pinpoint within their own opinion the single primary aspect among them all that makes Gold ownership more favorable than a matching dollar-denominated savings account.

This is a vital issue because the state of the economy is largely irrelevant. In the big picture it doesn't matter as much to each of us if the economy is getting stronger or weaker. Here's a bonus question: what is it that DOES matter to us, that is, the common man?

--- Ari

Old YellerRoger's message for the day#8648410/03/02; 12:31:04

It's a doozy.Especially for long time forum readers.

Click read message twice,Oct.3 should be highlighted.

PizzWe've Built a Car Without Reverse#8648510/03/02; 12:52:48

Many years ago the family automobile's transmission lost reverse, and my father couldn't afford to have it fixed. So we drove it a lot less, but when we had to, we had to make darn sure we didn't get into a situation where we had to back up.

The markets seem to be acting in about the same way. Just what do you do if you hold blocks of stock in the millions of shares, more redemption requests for cash than you have cash coming in and would like to unload say 500,000 shares of a stock into a thin market.

Ideally you'd try to find some big player like yourself who was buying to take it off your hands, but since all the big boys are having the same problem, you'd have your broker or trading desk sell smaller blocks into as much strength as you could find, so as to not disrupt the price and try to feed it off to the traders. Now, with the traders picking up on the game and cutting their volume back and really looking to be more short than long, the markets just keep grinding lower and the big boys have virtually no way out.

Any way they try to move the block of stock, they will force the market down rather dramatically. Maybe they loose 2 or three bucks a share on the block they want to sell, but the real damage comes from the stock they still hold. It's value has dropped accordingly, and you have a major book loss when you mark to market.

I'd have to assume that credit lines are being used to the max right now, rather than major selling. When the credit lines run out, or the banks have to curtail their lines, what then?

Aristotle: I hold gold for the "what then time", and my major concern is a blindside where the whole system comes apart overnight.


Tate(No Subject)#8648610/03/02; 13:03:31


The fact that US Federal Reserve allegiance is with member banks and not the people is disastrous for this country. Here you have independent private organization that controls money creation of this country. No wonder they hate and manipulate price of gold, since it is direct threat to their power. US voters can not remove or terminate their mandate directly. Only US dollar price of gold reveals the greed and amount of cheating that has been done for the last hundred hears or so. State secretary remarked recently, USA never devalued dollar. Not true. They did not devalue against other paper currencies, but they did against ultimate currency - GOLD.

Gold is independence and ruling elite will attempt every possible trick to prevent you from being independent.

AristotleThanks Pizz!#8648710/03/02; 13:40:19

Anyone else willing to share their thoughts on the matter?

--- Ari

sectorCar without reverse=Unidirectional Fed policy#8648810/03/02; 14:16:16

pizz has it right

Since June 1996, the Federal Reserve and Treasury have been on an adventure with only one direction, the "Strong dollar" policy via a controlled gold price...a forced gold standard set to manage interest rates down. They have recently hit bottom with interest rates.

This is a one-way trip with no escape. There is no future rising interest rates. There cannot be since stressed corporations who borrow would face crushing costs along with pension fund disasters being revealed by the falling SM.

The experiment has failed and the Master of the Universe is being prepared for the crypt of financial history, just as his master plan implodes.

Today the Fed's top mouthpieces said "Rates are low enough". That's a nice way to say they CAN'T lower them any more because things have gotten out of hand at FNM and FRE with "Duration gaps". GE is buying treasuries against their debt's a free ride for them for now.

Steven Roach has written about the only escape route being a devaluation. Well it can only be the US and Japan and no one else's currency otherwise to whom would the US and Japan export? There must be a change in valuations between the US/Japan and everybody else. Thus a cleansing deval. Economic "Cleansing" means "Robbing" of wealth to ordinary folks.

Gold rises the next minute after the announcement and the Fed prays that demand subsides after they feed the voracious gold-hungry world. It happens with lightning speed just as it did in Argentina. The population overnight learned that their government was not their best friend.

Did the Fed really think that the European bankers would sell ALL their gold to front a Fed scam? Deustche Bank has reduced their gold derivatives to around $35 Billion from $51 Billion so THAT former cabal member ain't pushing the Fed cart anymore.

Perhaps there will be some intermediate higher level of gold that the Fed has in mind to try and hold. Say, $400 per ounce.

It won't work. Once the idea floats that the Fed is losing things as in an old fashioned bank run, nothing they do will matter.

A helicopter losing a blade.

Black BladeMartha Stewart resigns from New York Stock Exchange board #8648910/03/02; 14:19:49


NEW YORK (AP) -- Martha Stewart, under investigation by the Justice Department for her sale of ImClone Systems Inc. stock, resigned Thursday from the board of the New York Stock Exchange. The announcement came a day after an assistant to Stewart's stockbroker pleaded guilty to a misdemeanor charge of receiving money and other valuables for keeping quiet about the sale of ImClone shares last December by Stewart, the cooking and home decorating magnate. Stewart sent a letter of resignation to NYSE chairman and CEO Dick Grasso before the exchange's board meeting Thursday. "It has been a great honor and privilege to sit on the board, but the rigors of my own very busy and demanding corporate life require my full attention at the present time," she said in the letter.

Black Blade: Oh yeah, that's the reason.

Black BladeDock Worker Lock Out - Unintended Consequences?#8649010/03/02; 14:30:30

I just saw an interesting report on the dockworker lock out. Apparently this has had some unforeseen effects on industry. There are several businesses that rely on "just-in-time" inventory. In is supposedly a strategy where industries save on warehouse costs by delivery of parts and goods just in time for manufacture. In Fremont, CA an auto assembly line is shutdown while 5,000 workers mill about waiting for parts. Meanwhile there are over 90 ships lined up in Long Beach and 19 "parked" in the San Francisco Bay. I don't know how many in other west coast ports. Other impacts include the drop in wheat prices as wheat cannot be shipped out to foreign markets and incoming produce rots on board waiting ships. Oh yeah, there are many more ships on the way. As I said previously, the losses were estimated to cost about $1 billion a day, however, the ripple through costs are likely to cost much more and that doesn't even account the losses from the temporary boost from the holiday season. Yikes! We can expect to see a downturn in what were perceived to be today's "bullish" economic data. Hang on for the ride.

- Black Blade

AristotleTate, if it come down to it, who should we support -- big government or big business?#8649110/03/02; 14:33:27

The thing I'm referring to is your statement about the Fed --

"The fact that US Federal Reserve allegiance is with member banks and not the people is disastrous for this country. Here you have independent private organization that controls money creation of this country."

There are conflicting schools of thought on this. Some people prefer market economies in which every aspect of the economy is driven by private enterprises instead of Government. On the other hand, there are people who despise private enterprise and would rather have the Government take the lead role. Which setup would YOU trust more as the steward of your personal well-being?

As it has shaken out through time, I think an unbiased assessment of what we've actually got with our Fed-led monetary system is a balancing act between those two ideological extremes.

In the final analysis, to us common cogs should it even matter who's hand is on the oil can? (Wha? ...that's a reference to my post yesterday.) In other words, if it's inflation we fear and despise, then why don't we instead kick up our heels in glee over the flow of easy money while using Gold ownership to preserve our saving's purchasing power. And if it's deflation we fear the monetary authorities will impose upon us, then why don't we take more conservative approaches to our individual credit/debt management and build up our Gold savings at attractive prices to serve us well during the inflation phase that follows?

The only thing that allows public or private monetary authorities to intermittently curb the value of Gold is their ability to dilute and divert legitimate Gold-buying intentions with paper substitutes that offer the promise of interest or leverage. It's the oldest game in the book.

Look at it this way: Why should you have any more faith in the quality of their paper Gold than you have in their paper money in the first place? After all, aren't many of these sadly distracted people pursuing paper Gold as some sort of escape from the perils of paper money going bad? It's gotta be like riding on a passenger train that is going over a cliff. You're not going to save yourself merely by changing seats from economy to first class. You won't alter your fate because its still all connected -- part of the same train.

To save yourself, you have SIMPLY GOT TO GET OFF THAT TRAIN, and do it before *before* BEFORE the derailment occurs. That's what we do every time we cash in our paper dollars, pesos, lira, roubles, euros, pounds, yen (etc) in exchange for Gold. Gold is a sure and independent vehicle that can't possibly go over the cliff like the entire paper train can.

Gold. Get you some. Everything else is just details. --- Aristotle

OperativeThose Evil Dwarfs of Wall Street#8649210/03/02; 14:51:45

@ Black Blade
Just as I was about to give up all hope of the powerfull Dept. of Justice to do anything about all the corruption on Fall St. they prove thier mettle by investigating Martha Stewart. She was in the wrong and I was glad to see her step up to the plate and resign today. And yes, her public relations put the best spin they could, "too busy running her business, blah blah blah."

What bothers me is what she did pales in comparison to the thousands of evil dwarfs, trolls, banksters, the shakers & movers of Wall Street have been doing for many years, the fleecing of America's Wealth. I suppose the recent perp walks of a few and picking on Martha Stewart is supposed to make the sheeple feel confident that things are beginning to be set straight. That the crooks have been rounded up and justice is being done. I know you know better, and so do I.
Perhaps if I inhale one of those funny cigs, I too would have a differant view. Perhaps I could begin to believe the bubblevision media. If I could only believe Gabby Abby, I could probably even stop taking the daily pill to lower my blood pressure. All would be happy and nice. But for now, I say the story of Snow White needs to be rewritten in a realistic tone, one where the evil dwarfs hide thier copious sins and set Snow White up to take the fall. That's the world as I see it, but it's probably because I am turning into a cranky old man. <toothless grin>

By the way, speaking of old men, have you filled that freezer yet? <sound of elk snickering>

Black BladeRe: Operative#8649410/03/02; 15:15:08

Agreed, Martha is just more visible. When she is paraded in a "perp walk" then we should see the floodgates opened perhaps. I don't think that we will see that though. I think that it would be politically incorrect to have a woman in handcuffs paraded for a "perp walk", even if it is Martha Stewart. There are definitely bigger fish to fry though. As I have said, when you see one cockroach it is a sure bet that there are many more.

I am just headed out the door to hopefully slay a beast. I am not looking for a trophy - just food. I have a month left to fill the freezer. So far I have only seen a few cows and the only bulls are on private land. Cheers!

- Black Blade

BoilermakerAri's Challenge#8649510/03/02; 15:18:46

Gold is enduring wealth with the advantage of transportability and convertibility to other assets as the need arises.

What matters? The Bill of Rights, our protection against any and all governmental overreach.

Operative@ Black Blade#8649610/03/02; 15:27:08

"I am just headed out the door to hopefully slay a beast. I am not looking for a trophy - just
food. I have a month left to fill the freezer. So far I have only seen a few cows and the only
bulls are on private land. Cheers!"

Sing along with me, This land is your land, this land is my land, Id rather eat fresh meat, than any old canned ham....

Good luck!! And keep hangin in ...I feel soon the elk will tire of playing the Escape & Evade game with you and just throw themselves into the back of your truck.

OperativeMore of Dem Bones#8649710/03/02; 15:39:53

Oct 3, 2002

EMC to Cut Another 7 Percent of Work Force

The Associated Press

BOSTON (AP) - Data storage giant EMC Corp. said Thursday it would lay off 1,350
employees, or 7 percent of its work force, and lowered its earning outlook in the face of a
technology spending slump.

The Hopkinton, Mass.-based company said its work force would be 17,000 people after the
cuts. EMC laid off more than 4,000 workers last year as spending on its high-end data
storage hardware and software plummeted.

EMC also said it expected a loss of 2 cents per share for the quarter that ended Sept. 30 on
revenue of $1.25 billion. Analysts had expected a loss of a penny per share.

The company also said it no longer expected to be profitable in the second half of 2002.

AristotleThanks go out to you, too, Boilermaker!#8649810/03/02; 15:54:37

I'll be offering an answer to my own challenge too -- just as soon as I can boil Gold's many merits down into a single soundbite.

Let's keep hearing from others in the meanwhile...

--- Ari

SilverHoardSilver Supply#8649910/03/02; 15:58:10

SLOWMAN #86474

Thank you Slowman for looking into one companies sales and purchases in the US silver market. Here at the Forum there is discussion re the gold/silver price ratio, which metal is more undervalued and which metal price will spike first when the BIG price move occurs. There is so much technical financial opinion here. It is this one persons investigation that gives me a real world look into what supply and demand is "on the street". My experience locally is junk silver is a big OUT OF STOCK sign. Even silver rounds are very limited. Granted this is local retail info but it says something to me. So whether it is the sharing of info on the "magnetic silver" story or Comex contracts, I believe all this individual knowledge of the silver supply needs to come to the Forum to allow all who hawe an interest in silver to benefit. One more thing if you will. The holidays draw near. A gift of silver, coin, round, bar, might get the recipent to think about adding silver to their portfolio as insurance. May I hear your thoughts.
CoBra(too)The Metropole Cafe carries a speech by Ferdi Lips! #8650010/03/02; 16:02:47

The author of the recent published and alraedy famed book "Gold Wars". Ferdi, was also the founding general manager of Rothschild Bank of Zurich, before he founded the Lips Bank.

The speech was held in Austria's town of Feldkirch, cose to the Swiss border recently and this was the latter part of his conclusion:

"The paper or funny money disease is like a drug addiction. It takes more and more of the drug to satisfy the addiction and a collapse is the final result. There is no indica­tion today that this experiment with counterfeit money should end any better than earlier, similar experiments. Due to the US's economic power it has already lasted longer than one could expect. Allow me to conclude with a quotation from a speech held in Washington D.C. in 1948 by Congressman Howard Buffett from Nebraska, father of the most successful investor of all times, Warren Buffett. The address was entitled Human Freedom Rests on Gold Redeemable Money:
"Our finances will n e v e r be brought into order until Congress is compelled to do so. Making our money redeemable in gold will create this compulsion. […] The paper money disease has been a pleasant habit thus far and will not be dropped voluntarily any more than a dope user will without a struggle give up narcotics. But in each case the end of the road is not a desirable prospect.[…] I can find no evidence to support a hope that our fiat paper money venture will fare better ultimately than such experiments in other lands. Because of our economic strength the paper money disease here may take many years to run its course. […] But we can be approaching the critical stage. When that day arrives our political leaders will probably find that foreign war and ruthless regimentation is the cunning alternative to domestic strive. That was the way out for the paper-money economy of Hitler and others. […] I warn you that politicians of both parties will oppose the restoration of gold. […] Also those elements here and abroad who are getting rich from the continued American inflation will oppose a return to sound money. […] But, unless you are willing to surrender your children and your country to galloping inflation, war and slavery, then this cause demands your support. For if human liberty is to survive in America, we must win the battle to restore honest money. […] There is no more important challenge facing us than this issue – the restoration of your freedom to secure gold in exchange for the fruits of your labors."

A great read touching on the basics of real gold backed currencies - not not fake Gold Standard we used to know from 1934 and then from Bretton Woods (1944) to 71. -cb2

Brilliant as always and I'm sure Chris Powell will do us the
honor to

kasperjackChris Thompsons Plans To Take On Central Banks#8650110/03/02; 16:06:43{CADD637D-57BB-4099-B1B7-3D317363544C}

Security to benefit from bullion boom, experts say

By Thom Calandra,
Last Update: 11:45 AM ET Sep 24, 2002

NEW YORK (CBS.MW) -- Would an electronic substitute for physically owning gold boost
demand for the metal in times of fiscal turmoil?

The World Gold Council, a bullion trade group,
acknowledges it is working on a new investment vehicle
for gold but offers few details. Experts at a New York
bullion conference say they expect such a security,
probably in the form of an exchange-traded fund that is
listed on the New York Stock Exchange, in coming

"I think Chris Thompson's product will make a big
difference," said Rick Rule, chief executive of Global
Resource Investments. Thompson is the new chairman
of the gold council, whose charter is to increase
investment demand for gold. "If it's backed by the gold
council and there is a big, recognizable gold depository
involved, it will be a big success."
Best of Luck Chris....

Boilermaker"Rich Dad's Prophecy"#8650210/03/02; 16:11:51

Here's a snip from the author of a new book "Rich Dad's Prophecy" that might twist your tail:

The Law That Changed the World

From a conversation in the 1970s between rich dad and author Robert T. Kiyosaki:

"Do you remember me telling you about ERISA?" asked rich dad.

"Yes, vaguely," I replied. "You've mentioned it on several occasions. I just have not fully understood what you were saying or why this law change was so important."

"Most people don't realize its importance," said rich dad. "It may be years before people begin to wake up to the ripple effects this law change will have in the future."

"What is this law change and why was it passed?" I asked.

"Good question," said rich dad. "First of all, ERISA stands for Employee Retirement Income Security Act. It was the Act that made 401ks possible. I too did not pay much attention to its passage . . . but soon my accountants and my attorneys began advising me on changes I needed to make in my businesses. Once that began to happen, I began asking more in-depth questions."

"And what did you find out?" I asked.

"It seems the act was passed to help protect employees' retirement money from abuse by their business owners," said rich dad.

"What kind of abuse?" I asked.

"There have been many kinds of abuses of retirement plans. Even in some large blue chip companies, pension plans are empty or are underfunded. And many times, a company would buy another company not because of the business, but because they wanted the business's retirement money. Some of these more responsible businesses had tens of millions of dollars in their employee retirement funds and that pool of money was often more valuable than the business. So the raiding company would buy the business and bleed the employee retirement fund."

"They would take over the company just for the retirement money?"

Rich dad nodded his head. "But that was not the only abuse. There were more. It was because of these abuses that ERISA was supposedly passed."

"Why do you say supposedly?" I asked.

"Well, the act was passed as a benefit for employees . . . a way to protect employees from these abuses . . . but as we all know, nothing is only good for only one group of people. The company also benefited from the act . . . but the benefits to the company were not really mentioned in the press."

"So how did it benefit the businesses?" I asked.

"Well now that you've had your first business, let me ask you this question. How expensive is an employee retirement plan to the company?"

"You mean including Social Security payments plus adding money to their retirement plan?" I asked.

Rich dad nodded his head, saying, "Yes . . . how expensive is it?"

"Very expensive," I replied. "I often wished I could pay my workers more but the hidden taxes-taxes the employees are often not even aware of-are so high I could not afford to pay much more. Every time I gave them a raise the government also got a raise."

"So while ERISA was passed as a benefit to employees, it was in many ways more of a benefit to the employer. In many cases the expense of retirement has transferred from the employer to the employee."

"But doesn't the employer have to match the amount the employee puts in?" I asked.

"They can if their plan allows it . . . but the key word is match," said Mike. "In other words, the dollar amount the employer had to pay was now significantly reduced. That is like taking the cost of your mortgage payment and cutting it in half. Wouldn't you want to reduce your mortgage payment by half?" Mike was very well versed in this new retirement plan because rich dad put him in charge of understanding it. "And on top of that, many employees elect not to contribute anything, so the employer has nothing to match."

"So if the employee does not put any money into his or her fund, the employer pays nothing. The cost of that employee's retirement just went to zero. And is that why we're going to have a problem? The problem of people without any retirement savings?" I asked.

"That is one of the problems . . . and it's a very big problem. But in my opinion, it is not the person who has nothing in their retirement plan that will ultimately cause the biggest problem . . . the biggest problem will come from those employees who have diligently put money into their retirement accounts. It is those who have faithfully put money into their retirement plans that will cause the biggest stock market crash in history."

"In history?" I asked skeptically. "And the crash will not be caused by those employees who have nothing . . . it will be caused by those who have set money aside?"

Rich dad nodded his head. "Think about it. Can someone with nothing cause the stock market to crash?"

"I don't really know. I've never really thought about it," I replied.

"The biggest stock market crash of all will be caused by millions of people with their money tied up in mutual funds and other types of shares in the stock market, not by those without any shares or money," Mike added. "It's just common sense."

"This change in the law will bring about many problems and one of the problems, way off in the future, will be this giant stock market crash," said rich dad as our food arrived.

"Why is that? How can you be so sure?" I asked.

"Because the people putting money into the market are not investors. As you already know, most of your workers cannot read a financial statement. So how can you invest if you cannot read a financial statement?" asked rich dad. "The resulting impact started by ERISA is not only leaving millions of people without a retirement plan, it is also forcing people to trust their financial future to the stock market . . . and we all know that all markets go up and all markets go down." Rich dad looked directly at me. "I've been training you and Mike to be investors . . . investors who can make money in an up market and in a down market. But most employees do not have that mental and emotional training . . . and when the big crash begins, I believe they will react as most untrained investors react . . . they will panic and begin selling . . . selling to save their lives . . . selling to protect their future."

"When do you think this will happen?" I asked.

"I don't know," said rich dad. "No one has a crystal ball with 20/20 vision. But between now and the biggest crash of all, I predict there will be smaller but growing booms and busts in the stock market . . . and these smaller booms and busts will come before the biggest of all booms and biggest of all busts."

"So there will be warning signs?" Mike asked.

"Oh yes," smiled rich dad. "There will be plenty of them. The good news is that you boys will have plenty of time to practice gaining experience and skill through these smaller booms and busts. Just as you two practice surfing on the smaller waves of summer, in preparation for the larger waves of winter, I would recommend you do the same with your investing skills. As the booms and busts get bigger and bigger, you'll find it easier to become richer and richer."

"But others will become poorer and poorer," I said quietly.

TateAristotel#8650310/03/02; 16:23:45

Historically all paper currencies do fail. Any different fait for dollar? Unlikely.
If I'm correct, currency creation surrender to private hands came when US government was broke at the turn of 20th century. It must have been tough decision.
He who controls money printing controls it all.

AristotleCoBra(too), thanks for bringing that forward#8650410/03/02; 16:42:53

I have loads of respect for F. Lips and his important message. I can't help wondering, however, if he isn't actually advocating an unnecessarily difficult course of action (policy.)

My point can be found in this soundbite of his comments that you provided--

"For if human liberty is to survive in America, we must win the battle to restore honest money. […] There is no more important challenge facing us than this issue – the restoration of your freedom to secure gold in exchange for the fruits of your labors."

There continues to be what I would consider *undue* emphasis on the "honesty" or "soundness" of money by participants in this worldwide dialog.

As I tried to characterize yesterday, money is just a thin film of lubricant. The problem arises when people try to make more of it than that. As long as it keeps flowing, who cares if it's smelly or inedible or causes a rash or breaks down very quickly after it accumulates in the drip pan?

The point is, in order to improve our quality of life we don't have to walk the long hard road for bringing about policy amendment for the end goal of honest money. Is is far more important that we have honest/sound savings. And without the daunting task of revamping policy we can have it today!! Just take the easy path to your Gold broker's door.

Wouldn't this regular conversion of that nasty lubricant into Gold -- something we can all do today -- satisfy Lip's requirement that we be able to enjoy freedom to secure gold in exchange for the fruits of our labors?

See? He complicates the issue by putting undue emphasis on the lubricant and not on the nature of the savings. We want sound savings that is not diluted by government and banking shenanigans. That's what matters most because that's what we must draw upon (our savings) when the chips are down and we're dealt a bad hand.

Honest Gold savings. Get you some. --- Aristotle

R PowellGerman silver site#8650510/03/02; 17:04:31

For those interested in silver and who can read German. If anyone does take an interest and does also find anything there of interest, please be kind enough to pass on the information to those of us who can not read the language.

TownCrierWGC news brief on gold#8650610/03/02; 17:07:03

Rhona O'Connell reports the following from India.

--------figures show that official imports into the country in August were up at 37.3 tonnes this year against 32.4 tonnes of last year.-------

Paper AvalancheWho knows what?#8650710/03/02; 17:47:32

JPM now down below $18/share today on roughly 1.5x normal daily volume. Smoebody knows something. I smell a Friday afternoon spike in POG.


aussieA Must Read#8650810/03/02; 18:07:56

A Number 1. read to any lurkers out there is the 'ABCs of Gold Investing'. My copy arrived a couple of days ago, personally signed and with best wishes from the author Michael Kosares.

As a newbie to this gold business, I have been looking around for sometime for a greater understanding of the subject, - even rang the mint for their advice on books or articles. I was given the name of a book, but unfortunately it was not to be found in any book stores. I'm sure the information is out there,- but finding it easily is another matter,- or maybe it is just difficult for the smaller investor in Australia who is just ignorant on where to go.

The ABCs of Gold Investing was just a great read and I am only sorry that Western Australia does not have an equivalent office to USA Gold. Gold scams have been rather notorious over this way which may well have frightened off small time investors from even thinking about including the metal in their portfolio.

Anyway, after reading this book I have learnt that gold is not just gold.


silvercollectorOperative#8650910/03/02; 18:18:31

How many 'disturbing the peace' infractions have you incurred?
silvercollectorOperative#8651010/03/02; 18:36:30

Not sure if you are jiving BB but here goes.

I am at the cottage working out of town for the last week. Nearly almost smacked deer coming into the lane 3 nights in a row. The pickerel just about jump into the boat they are so damn hungry this time of year and there are so many Canada geese landing at the shoreline that I could grab a paddle and smuck out a couple hundred.

Should I grab another 'Negro' and fill the freezer?

USAGOLD / Centennial Precious Metals, Inc.Like a portable piece of USAGOLD. Read it on your porchswing, take it on the plane.#8651110/03/02; 18:40:50

ABCs of Au by MK

The ABCs of Gold Investing

"If you are looking for thorough guidelines for making good decisions about private gold ownership, The ABCs of Gold Investing has all the answers." --Money World Magazine

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

CoBra(too)Savings - or saving a Remedy of Liberty?#8651210/03/02; 18:54:22

Ari, thanks for your kind and thoughtful reply.

As I'm sure Gata or the Cafe will publish the whole story here, I'll prudently abstain to provide the link as I'm sure Chris Powell will.

Otherwise, Ferdi claimed that the 19th. Century enjoyed the longest time-lines of legal tender in many countries currency's , not inflating over 100 years, exactly due to the real gold standard, id est gold convbertibility. Also, currency values automatically reverted to the mean, as trade imbalances were resolved by the THEN only monetary reserve - Gold!

Since 1971 we only have one global reserve currency, which is issued by the descendants of an (international), though private group of the original Jekyll Island Creature. Enjoying next to their hegemonial status, they also have attained the full backing of the today's world only super-power.
(And as we all realize, it's going to be the last thing the US is going to give up. Come hell or high water, or Bush to shove, the economy, the ethics and the sheeple going down the proverbial drain, we'll do everything possible to keep this status intact.)

... and as the liberty in the US, and elsewhere is fading rapidly, is it the "regimes" necessity to cloak its own inadequacy to provide a level playing field in the general 'capitalist' economy, to serve an oligarchy of politically correct, mainly service industry, next to the 'Establishment'.
(Wow, that was rather impolite, sorry - though coming from a former great believer and admirer of the american experiment and dream - I have to admit that nothing - good or bad - lasts forever).

Your point about the $ being the lubricant for exchange (goods) is well taken and more so not be erroneously mistaken for saving the fruits of labor.

Saving(s)? ... And that's where honesty and soundness of money comes in. In a consumption and credit driven or better crazed economy - being the last resort of the globe's economy - idiotically, as I admit - savings are almost sacreligeous and may be even be interpreted as un-patriotic!

... I'm the last guy calling the resurrection of a gold standard. I'm only advocating honesty and soundness provided by the currency I'm saving in ... and I've only found gold.

... after dumbing down generations of J6P's, you can't expect another (non-)lubricant to take up the slack - of a dwindling FRN - while J6P may not see forever ... on a clear day he may see JPM crumbling on behalf of its (gold) derivative desaster!
G'nite all - cb2

TownCrierHello aussie. I'm sure MK will appreciate your kind endorsement.#8651310/03/02; 18:56:55

I saw your wish for a Western Australia branch of USAGOLD. If MK could get a book to you, he can get gold to you too. The link above was made for our clients and friends just like you.

To my knowledge, USAGOLD - Centennial has recently fulfilled gold orders for clients in

New Zealand
the Netherlands
Great Britain
of course
the United States.

For what it's worth, our European clientele tell us that our pricing is superior to most of their banks and brokerage firms... and we support and encourage actual delivery of the gold while our competitors primarily promote certificate programs. Go figure. At least with Centennial you'll get a good price and GET what you pay for!


timbervisionPax Americana?#8651410/03/02; 19:28:57

"The official story on Iraq has never made sense. The connection that the Bush administration has tried to draw between Iraq and al-Qaida has always seemed contrived and artificial. In fact, it was hard to believe that smart people in the Bush administration would start a major war based on such flimsy evidence.

"The pieces just didn't fit. Something else had to be going on; something was missing.

"In recent days, those missing pieces have finally begun to fall into place. As it turns out, this is not really about Iraq. It is not about weapons of mass destruction, or terrorism, or Saddam, or U.N. resolutions.

"This war, should it come, is intended to mark the official emergence of the United States as a full-fledged global empire, seizing sole responsibility and authority as planetary policeman. It would be the culmination of a plan 10 years or more in the making, carried out by those who believe the United States must seize the opportunity for global domination, even if it means becoming the "American imperialists" that our enemies always claimed we were....."

If this article portrays the real goals of TPTB, what is the probability that this goal is achievable, and if achievable how long could it be sustained, and what are the short and long term implications for the financial world and gold. Did anything like this get factored into FOA and Another's thoughts.

HoratioResponce to Galerider msg #86459#8651510/03/02; 19:29:39

"Tides in the affairs OF MEN " by Edgar Lawrence Smith
I believe its available from Frasier Publishing Burlington Vt.,a fine company I have delt with for years.Its a mail order book company I originally became aware of when they bought out another company called "Books of Wall ST"from Dallas Tx.
I have no connection with either company,just a customer.

MKTimbervision. . .#8651610/03/02; 19:35:18

Sure. It was the center of many of our discussions, especially early on. Go back to the archives and read it for yourself.
HoratioFraser mispelled#8651710/03/02; 19:45:22

FlaccusMK#8651810/03/02; 19:46:54

OK. I'll bite. What was the upshot of those conversations?
ArcticfoxWell explained, if I do say so....#8651910/03/02; 19:48:28

Gold, Dollars, and Federal Reserve Mischief by Congressman Ron Paul 10.2.02
The mainstream financial press has been reporting the weakening of the U.S. dollar as measured against other currencies. This is unsettling news, as a relatively strong dollar was considered a hallmark of the economic boom of the 1990s- a boom that had far more to do with rapid credit expansion than real increases in productivity. The value of the dollar is down 18% this year compared to gold, which acts as a bellwether for the health of paper money. Gold prices historically rise when faith in paper currencies erodes, as investors seek the intrinsic value of gold to protect themselves from the arbitrary actions of the world's central banks, including our own Federal Reserve.

Gold is history's oldest and most stable currency. Central bankers and politicians don't want a gold-backed currency system, because it denies them the power to create money out of thin air. Governments by their very nature want to expand, whether to finance military intervention abroad or a welfare state at home. This expansion costs money, and the big-government politicians don't want spending limited to the amounts they can tax or borrow. This is precisely why central banks now produce all of the world's major currencies.

Yet while politicians favor central bank control of money, history and the laws of economics are on the side of gold. So even though central banks try to mask their inflationary policies and suppress the price of gold by surreptitiously selling it, the gold markets always cut through the smokescreen eventually. Rising gold prices like we see today historically signify trouble for paper currencies, and the dollar is no exception. Should the dollar continue to decline in value, America will find itself struggling to service our already massive debt load even as our foreign creditors become less interested in our dollars.

America once enjoyed a stable dollar backed by gold deposits, a "gold standard" system. This system gradually was undermined throughout the last century, until President Nixon finally severed the last tenuous links between the dollar and gold in 1971. Since 1971, the Fed has employed a pure fiat money system, meaning government can create money whenever it decrees simply by printing more dollars. The "value" of each newly minted dollar is determined by the faith of the public, the total amount of dollars in circulation (the money supply), and the financial markets. In other words, fiat dollars have no intrinsic value.

What does all of this mean for you and your family? Since your dollars have no intrinsic value, they are subject to currency market fluctuations and ruinous government policies, especially Fed inflationary policies. Every time new dollars are printed and the money supply increases, your income and savings are worth less. Even as you save for retirement, the Fed is working against you. Inflation is nothing more than government counterfeiting by the Fed printing presses. Inflation acts as a hidden tax levied disproportionately on the poor and fixed-income retirees, who find the buying power of their limited dollars steadily diminished. The corporations, bankers, and wealthy Americans suffer far less from this inflation, because they can take advantage of the credit expansion that immediately precedes each new round of currency devaluation.

Brilliant Austrian school of economics scholar Murray Rothbard asked a seemingly complex question in the title of his essay: "What has Government Done to our Money?" The answer turns out to be pretty simple: Government consistently debases our money. How and why it debases our money has everything to do with politics, and nothing to do with the laws of economics.

Written by Congressman Ron Paul: Posted 10/2/2002

MKFlaccus. . .#8652010/03/02; 19:49:39

Empires, nations states, monetary systems, paper currencies are transient. Gold, the individual remain. . . .I think Another was pretty clear on that.
timbervisionMK#8652110/03/02; 19:53:07

I needed that ... push into the archives.

PizzThe Bear and Tennis Shoes#8652210/03/02; 19:54:30

Heard this one today and my mind wandered a bit.

Two hikers round a corner and run into one big mean bear. One hiker sits down, opens his pack and pulls out a pair of tennis shoes. His partner says "What? Are you nuts? You can't outrun that bear!" "I know" says the hiker as he finishes tieing the laces, "but all I have to really do is outrun you."

Won't be long before the media pundits are quoting John Candy (rest his hilarious soul) from a movie which the name of totally eludes me --- Ba Ba Ba Ba Big Ba Ba Ba Beeaaar. . .

Got tennis shoes?????


ArcticfoxWonder if O'Neill's comfort with US trade deficit can be explained by another "New Paradigm" theory??#8652310/03/02; 19:58:47

Wednesday, October 02, 2002

The Fed on the Horns of a Dilemma
by Hans F. Sennholz

The Federal Reserve System may have run out of room to maneuver. Facing a looming recession, it resolutely lowered its discount rate and frantically expanded its credits. Eager to stimulate the sagging economy, it enabled and encouraged businessmen to invest more and consumers to go ever deeper into debt. Yet the specter of recession refuses to fade away.

What is the Fed--the appointed "guardian of prosperity"--to do? If it persists in expanding its credits, it may weaken the dollar and ultimately frighten foreign creditors around the globe. The dollar may fall versus the euro and other currencies, which may persuade foreign lenders to reduce or even liquidate their dollar holdings. But the Fed may also discover that all its expansionist efforts may be in vain, as economic activity contracts and goods prices stagnate or even decline. In uncertainty and fear, the people tend to cling to their cash holdings, which may render all Fed efforts to "reinflate" rather ineffective. Further discount rate reductions may fail to spur economic activity.

The Fed's dilemma springs from an abused and maladjusted credit market which, after many years of Fed intervention and manipulation, is turning unmanageable. The laws of the market, in particular the law of supply and demand, are inexorably working their ways and prevailing over Fed hopes and aspirations. In 2001, the Fed lowered its discount rate 11 times in order to invigorate the economy. In 2002, with the discount rate at 1¼ percent and the Federal Funds rate not much higher, total Federal Reserve credit has been expanding at rapid rates. On September 2, 2002, it stood at $665 billion, up from $609 billion a year ago.

Relying and building on this credit basis, commercial banks and other financial institutions expanded the stock of money (M3) from $7.6 trillion to $8.2 trillion, engaging in "loan securization," that is, the conversion of loans into marketable securities for sale to investors. They lend, securitize, sell, and lend again, in a continuing process of credit expansion. Offshore banks in the Cayman Islands, in Hong Kong, Panama, and Singapore add unknown volumes of their dollar credits, keeping the world money markets awash in U.S. dollars.

Should any other of the 174 central banks imitate the Fed and expand credit at such rates, its currency would depreciate immediately and goods prices would soar. It soon would face double-digit inflation and, should the expansion not cease promptly, runaway inflation. In the end, it would experience a universal flight from the currency and complete loss of its purchasing power.

The Federal Reserve System is subject to the same inexorable principles of economics, but, in contrast to all other central banks, the demand for its currency is worldwide. It is the world central bank managing the world dollar standard. It attained this prominent position because of the eminent position of the United States in world trade and finance. Although several other currencies are demonstrably more stable than the U.S. dollar, their small volumes render them unsuitable for assuming the universal position and function. The euro, which, since 1999, has been the currency of several European countries, may turn into a potential competitor to the U.S. dollar.

The dollar's eminent position in the world bestows extraordinary powers on the Fed. It grants the Fed a leeway of expansion much wider than that of any other bank. The worldwide demand for U.S. dollars supports their exchange value and offers the Fed a wide margin of credit expansion without visibly weakening the dollar. In its economic transactions with the rest of the world, it enables the United States to suffer annual deficits of more than $400 billion in its "current accounts"; that is, it allows the American people to import more goods and services than they export, which obviously benefits them greatly.

Many economists view the deficits as clear evidence that Americans are living beyond their means, a situation which cannot continue indefinitely, and may even invite envy and enmity. U.S. Treasury Secretary Paul O'Neill and his economists, on the other hand, seek to reassure their followers that a current-account deficit is always offset by a surplus in the capital account, that is, a net influx of capital. The deficit, in O'Neill's belief, is cogent proof of the desirability of the United States as a haven for foreign capital. As long as the United States offers ample opportunities for profitable foreign investments, there is no reason for concern. The trade deficits are mere symptoms of the attractiveness of American capital markets.

The O'Neill argument unfortunately ignores several recent developments that cast doubt on some aspects of this attraction. Much foreign capital that is seeking profitable employment in the United States does not find its way into economic production; rather, it finances private and public consumption.

While the current-account deficits have risen in recent years, foreign enterprise investments have dwindled. Nearly all the deficits now are financed by debt instruments that must be served out of current income. The foreign purchase of U.S. Treasury bills, notes, and bonds facilitates government spending; foreigners now hold more than $800 billion of U.S. government debt which is serviced by tax funds. If foreign investors should ever tire of financing the deficits, the U.S. dollar would come under pressure. In fact, it would fall if foreign holders should lose confidence in the dollar and begin to liquidate their dollar investments. The flood of imports would subside, American exports would increase, and goods prices would soar.

In recent months, the U.S. dollar has fallen substantially versus the euro, the Japanese yen, and the British pound. While further interest rate reductions by the Fed may accelerate this fall, they may not cause many goods prices to rise. On the contrary, a recession may initially overwhelm the forces of inflation and develop symptoms of contraction. Distress and liquidation sales tend to depress goods prices, as do producers and consumers clinging to their cash holdings. A growing demand for money obviously increases the value of money and depresses goods prices. In popular jargon, a recession may usher in "deflation," no matter how frantically the Fed may inflate its stock of money.

The Japanese recession, which has held that country in its grip since 1991, may serve as a warning of the unintended consequences of interest rate cuts and massive deficit spending. The Japanese economy is sinking ever deeper into a depression, with unemployment rising and stock prices falling although the Bank of Japan's discount rate hovers near zero and the prime rate is quoted at 1.375 percent, which compares with 1¼ percent and 4¾ percent, respectively, in the United States.

The Japanese government indebtedness exceeds 150 percent of GDP, which compares with the U.S. government debt of just 50 percent of GDP. The government obviously is trying to spend its way out of recession by consuming the people's savings, but instead merely is aggravating the decline. Indeed, the world is wondering how the Japanese people will ever be able to emerge from the deep hole dug by their government and its central bank.

In a recession, the quality of many credit transactions is called into question. With total indebtedness in the United States more than double the annual GDP--higher than ever before--a recession would jar and unsettle the whole credit structure, which would render any further Fed interest rate reduction rather ineffective. When numerous companies suffer staggering losses and finally are unable to discharge their liabilities, they cannot be saved by another cut in interest rates.

If, in desperation, the Fed should drive its rate even to zero, it could not thereby help an enterprise whose notes and bonds are marketed at double-digit rates. In short, the Fed may become rather impotent when the economy sinks into recession. Nevertheless, it can be expected to continue its policy of ease in the hope of rekindling the boom and thereby justifying its existence.

The current Middle East crisis could leave its mark on the American economy. If, in the coming months, the United States should strike at Iraq in order to remove a persistent source of terrorism, the price of oil undoubtedly would soar, which, together with the weakened dollar, would soon lift many goods prices. In previous international crises, the U.S. dollar actually strengthened because foreign capital sought refuge in the safe capital harbors of the United States.

In a new Iraqian crisis, the United States may lack the support of its traditional allies in Europe, which may actually lead to a withdrawal of some European funds and a decline of the dollar in world money markets. Moreover, American financial markets surely would lose some deposits and investments of the oil sheiks of Saudi Arabia and other Islamic countries, and that would aggravate the pressure on the dollar. If the Fed should substitute its own funds for the foreign funds withdrawn, it would weaken the dollar even further.

No one can foresee the scope and duration of such a conflict and its economic consequences. Yet we do presume that the symptoms of recession would soon give way to the well-known characteristics of inflation, as federal spending accelerates and the Fed accommodates the spending. As the dollar weakens and, in turn, reduces the stream of imports, goods prices are likely to rise again. That would improve the profitability of many industries, which would encourage new investments and more consumer spending.

Economic activity would soon accelerate, and the present correction and readjustment process would draw to an end. New distortions and maladjustments would be heaped on the old. In short, the needed correction would be postponed until, a few years from now, it would begin anew with a shrunken dollar. In the meantime, the excitements of war would make us forget our economic troubles.

Hans F. Sennholz, emeritus professor of economics at Grove City College, is an adjunct scholar of the Mises Institute. See also his Articles

CytekPaper Avalanche - JPM Closes below 18.50 a key technical#8652410/03/02; 20:00:08

As Jim Sinclair wrote a few weeks ago and i quote "I renew my prediction that under $20 JPM will effect gold higher. If JPM trades under $18.50 for two days as a closing price then, I believe, we will successfully challenge the $330 on gold. Today we are on the precipice of that Down Spiral and JPM is an indicator of whether or not we are locked tight in that DOWN spiral for general business and on the UP Spiral in Gold -- up and above $330 and $354 with the first stop at $372 in my opinion. Watch the market on JPM to determine the Spiral direction."

We will see what happens tomorrow at the House of Morgan. I will be watching my real time streamer with JPM highlighted in RED. If Sinclair is right and I do believe he is, next week should be very interesting for that old relic.

SlowmanSilver Hoard / Silver Supply#8652510/03/02; 20:04:26

The reason I stay in touch with local supplies of silver is personally I buy for several friends that do not want to get took. Got one of my poorer kids that even gets 5 ounces now and then. We always purchase the best buy to melt and readily available. Been trying to purchase 1/2 bag of coin for a friend for 4 weeks and none is comming to shops.Sure I can buy for 3.5 thru mail but waiting usually gets it at 3.3 times face which is almost melt.
I can always purchase ounce bars from my friend for 1.25 over spot and they are in plastic.They are beautiful !!!
I have also found 100 ounce bars are almost a thing of past.
The good news, ALL I
As for Christmas bars, One can normally buy for 75 cents over spot in 100 ounce quantities.
My goal is to help as amny people as I can and maybe WE can preserve our wealth with silver investing.Buffett,Soros
and Gates are not stupid. Follow the money.
I really like mining stocks as you don't have to worry about where to store them to prevent theft.Its a no brainer.
If we all help friends, MAYBE , we can put a hurt on JPMorgan and other unethical banks. This means buy gold for them too.
As always, best of luck to all .

Mr GreshamCoBra(too)#8652610/03/02; 20:05:04

I just got my copy of Lips' book today, and spent a good lunchtime reading it -- thanks for the reports on him.

Looks like Ari's had some good swings these past few days too.

It's a kind of group therapy, going through this re-tooling our thoughts about money together. Sort of a "first there is a mountain, then there is no mountain, then there is" Zen thing, too. The ability to think in two worlds in parallel -- I find reading history does it for me, so it helps me greatly, spending time with Rothbard and Lips revisiting the state of thinking around 100 years ago, when gold was money, and but a few games were being played around the edges of it.

And I even was able to slip for a moment back into my own thinking of years ago, about what a WEIRD thing it is, to buy these shiny round things, and keep them as valued possessions.

Powers of mass indoctrination. Never underestimate. And definitely, don't cross the herd when they're in full stampede...

sectorBOJ planning to propose hike in loan-loss reserves of banks#8652710/03/02; 20:25:33

Yomiuri Shimbun

The Bank of Japan will release a report shortly that will propose an increase in the loan-loss reserves banks should maintain to cope with borrowers defaulting on bad loans, sources close to the central bank said Thursday.

The report, which may be released next week, will outline the central bank's basic policies on nonperforming loans, they said.

Currently, loan-loss reserves are calculated on the basis of the probability of loan recipients going bankrupt.

The bank apparently wants to introduce a new method of calculating these reserves by taking into account various factors, including the future profitability of firms receiving loans, according to the sources.

In cooperation with the Financial Services Agency, the Bank of Japan plans to press banks to speed up the disposal of nonperforming loans, according to officials.

In regard to loans categorized as those that need close observation, such as those for which repayment has been delayed, the total amount to be repaid will be projected on the basis of future cash flows of loan recipients. The portion of loans that are not expected to be repaid will be posted as loan-loss reserves, they said.

In this case, the loan-loss reserve ratio for such loans would be raised from the current 20 percent to 30 percent-35 percent.

Increasing loan loss reserves will sap the Japanese banks even further than they are today. IF the banks bought the NK225 a few months ago they are underwater from THOSE trades too.

Japanese insurance companies are teetering due to the falling NK225.

Gold is the real thing folks.
About the WGC's Plans:

Any new-fangled "Product" from the World Gold Council that isn't the real thing is a waste of time.

FlaccusMK#8652810/03/02; 20:27:00

You get the sense that Another is different from the rest of the analysts we hear day to day in the world of finance. You seem to have been in touch with him on some level many of us were not. How do you explain that difference and why he struck a chord with so many people?
PizzSlowman/R Powell/G-Kan#8652910/03/02; 20:30:43

And any other silver buffs out there. You might want to take a stroll over to Puplava's site and read his market wrap up. (

Watching the markets today, I was musing about selling blocks of shares into a thin market. According to Puplava, HL has over 2 million short shares out there as of 9/15. Going to be a bit more than tough to buy back those cheaply unless the whole PM market implodes. . .

Going to get exciting.


Black BladePaper Rules – Puplava#8653010/03/02; 20:41:07


The paper markets control the commodity markets regardless of the size of the market. Through the use of derivatives, a small amount of capital controls the commodity markets worldwide. That amount is estimated to be somewhere in the neighborhood of around $200 billion. This is a highly-geared market where a small amount of capital controls a much larger market. In this case, it is $200 billion in actual cash money that is leveraged to the tenth degree through paper contracts that control a trillion dollar market for hard commodities ranging from oil to gold. In "Debt & Delusion," Peter Warburton has made a strong case for how central banks have waged war against tangible assets in order to keep their prices suppressed. This is done through gearing the commodity markets whereby a small amount of capital is leveraged into a position of control over a much larger market.


As inventory levels from natural gas, oil, silver, gold and other commodities are drawn down, a supply train wreck or price shock is slowly building momentum. Already we are facing our second oil price shock in three years. Oil prices have been distorted by a combination of political convolutions and derivatives. Once supply stockpiles are depleted, prices will reverse and head higher as demand fundamentals and a loss of confidence in paper overwhelm commodity markets. One day soon Americans and the West in general are going to wake up to find the financial world and the commodity markets aren't as they seem. Supply shortages of key commodities, energy outages and other supply disruptions should become more commonplace. In the case of silver, gold, oil and natural gas, we will see prices rise to their true fundamental value, which by the way is much higher than what is now reflected in the markets.

Black Blade: A pretty description of the paper chase and the disconnect between reality and fantasy. A good read on how Gold, Silver, NatGas, and Oil are controlled by highly leveraged (geared) paper derivatives. Obviously impossible to control forever. What if these companies went under and the product no longer available? Hmmm…

Check and Mate!

MKFlaccus. . .#8653110/03/02; 20:48:09

I'm sorry but I can't even begin to answer your question, though I'll admit, it's a good one. I'd just say that Another spoke to the heart as well as the mind, while most economists are interested in left brain stuff only. That's why so many hung on every post. The archives tell the story. . . . .my best, Flaccus. And, yes, I wish Another were still posting. You are new here? Welcome. Hope we hear more from you.

Happy reading, Timbervision. . . .Let us know what you think.

Black BladeBad loan jitters weigh on U.S. banks #8653210/03/02; 20:52:05


NEW YORK, Oct 3 (Reuters) - U.S. banks could face wider-than-expected losses on loans to the telecommunications sector and even other industries, rattling Wall Street ahead of third-quarter earnings results. The latest warnings also show increasing numbers of bad loans at regional banks, which so far partly have been spared the losses that the country's top banks already took on loans to large corporate clients like bankrupt energy giant Enron Corp. or to foreign governments like Argentina. U.S. rating agencies have been cutting debt ratings on a slew of companies, including banks, putting pressure on borrowers and the lenders. The telecommunications industry is suffering from overcapacity and slack demand, while weak stock prices and the slow U.S. economy are hurting banks.

Black Blade: The outcome? Think Argentina and Japan! Recovery? I think not.

Black BladeBear Stearns' multi-billion-dollar oops! #8653310/03/02; 21:02:37

Firm's clerk enters order to sell $4B worth of securities when order should have been $4M.


NEW YORK (Reuters) - A slip of the finger led Bear Stearns Cos. Inc. to erroneously enter an order to sell nearly $4 billion worth of stocks Wednesday, fueling an already tumbling market. The order about 20 minutes before the closing bell was the result of a "clerical error" and should have been entered as $4 million, the New York Stock Exchange stated. All but $622 million of the orders were canceled before execution, it said. Bear Stearns said the error will have no material impact on the company and declined to comment further.

Black Blade: Sorry, but this still cracks me up. As far as "no material impact on the company" is concerned, well maybe not as it is only electrons flowing through the ether anyway right? Hmmm…

Black BladeCorporate Earnings - The incredible shrinking estimate #8653410/03/02; 21:12:59


Sure, third-quarter earnings should show a gain. But estimates keep coming down. Unfortunately, the outlook for autumn and winter is still shaky. A slew of companies will report their third-quarter results in October and earnings estimates keep getting lower as more companies warn. Barring a quick, miraculous recovery in corporate spending, that probably won't pan out. "Estimates for the rest of this year are probably unachievable," says Dan Bandi, director of value equity investment for National City Investment Management. So with an increased likelihood of more earnings estimate cuts across the board in the near future, in addition to concerns about accounting fraud and Iraq, the next few months look tough for the market. In other words, investors might need to brace -- to borrow a title from Cinderella, another metal band of yesteryear -- for a "Long Cold Winter."

Black Blade: Meanwhile the infomercial commonly referred to as CNBC or CNNfn continue to trot out guest after guest explaining how wonderful everything is and how earnings have increased (pro forma that is).

Gandalf the WhiteThe RETURN of Siege Engine !#8653510/03/02; 21:27:58

slingshot (10/3/02; 02:53:11MT - msg#: 86469)
Siege Engine
GREAT saga "restart", there Sir Slingshot !!
The daily REAL LIFE NEWS is playing out just like your saga. Watch T.V. and you can dream to yourself that "I've been here BEFORE !"
Tks, Keep them coming!

Gandalf the WhiteWOWSERS -- My eyes have been opened to a VISION ! <;-)#8653610/03/02; 21:56:45

Upon returning today from a hard day "training" Orcs to not interfere with activities of the Hobbits, I read the interesting postings of a "Newbie", Sir Flaccus, (WELCOME Sir Flaccus-- SIR MK and Sir Flaccus' discussions (10/03/02; 20:27:00MT - msg#: 86528)), and have my eyes opened to something that I had totally failed to consider.
One of the first spots that is visited when NEWBIES arrive at the USAGOLD Forum is the ARCHIVES !! SOME portions of the ARCHIVES are not well lighted and may be considered a "confined space". The point of my worry is that --- THERE may be many NEWBIES lost in the ARCHIVES ! I am requesting that WELL Provisioned VOLUNTEERS be outfitted and search sections of the ARCHIVES on a regular schedule. WHILE the Search Party is in the ARCHIVES, IF they need not resque a lost NEWBIE, they can bring back an OUTSTANDING post or series of posts that will be of interest to the present lines of discussions. ANY Volunteers ?

Black BladeGoldman Allocated IPO Shares Unfairly, Congress Says #8653710/03/02; 22:05:52


Washington, Oct. 3 (Bloomberg) -- Goldman Sachs Group Inc., the biggest underwriter of U.S. initial share sales in the past four years, allocated stock that often yielded instant profits to clients including executives at EBay Inc., Global Crossing Ltd. and 19 other companies, documents released by Congress showed. The House Financial Services Committee, which is examining whether Wall Street firms allowed executives to buy shares before they were traded to get investment-banking business, is also examining Credit Suisse First Boston and Citigroup Inc.'s Salomon Smith Barney brokerage unit. ``The practice of making IPO shares available to those with investment-banking business to offer is unfair to average investors who were unable to buy shares until after prices spiked in the first day of offering,'' Michael Oxley, chairman of the committee, said in a statement.

Black Blade: The rumor tonight is that the SEC and New York AG Eliot Spitzer will soon begin to pursue possible charges against Goldman Sachs Group Inc., Credit Suisse First Boston and Citigroup Inc. The pressure and the spotlight is on this hot new topic of concern. Other targets are Jerry Yang of Yahoo, Meg Whitman of EBay, and Ken Lay formerly of Enron for accepting what amount to bribes. This is looking like the next wave of executives to do the famous "perp walk". Maybe someone should create a dance called the "perp walk". Hmmm…

Golden BearAristotle (msg#: 86483)#8653810/03/02; 22:33:16

Here's a challenge to everyone...

Sir Ari,

spoke to my brother today, and he answered your challenge without even knowing about it.

His quote: "Too many are caught in the deluded perception that the Government will always exist, and bail them out..."

It's all about PERCEPTION, and that's why I own bullion...


Strad MasterQuestion for Black Blade#8653910/03/02; 22:45:39

Oh Oh!!!

Regarding the guy who's finger slipped while placing a sell order for 4 million dollars worth of stock - "inadvertently" tanking the market. They say that it doesn't affect anything. Hmmm... According to the published figures they actually sold off 378 million dollars worth of stock. They intended to sell only 4 million - so 374 million was sold accidentally. Right? Doesn't all that stock, in theory at least, belong to someone? What, exactly do you think they will tell the holders of all that stock? "Oops. Sorry about that..." It's hard to imagine that something that big will just disappear into the ethers. It's lucky the guy with the slippery fingers doesn't live in Saudi Arabia or they might just chop off his fingers.
Black BladeRe: Strad Master - Bear Stearns Fiasco#8654010/03/02; 23:18:40

I was under the impression that the order was for $4 million and that $622 million actually went through before the transaction was cancelled. When they claim that there is no "material effect" on the company it sure does make one wonder who is "materially effected". It usually is the responsibility to make their clients whole when an error is made so this does raise a few questions as well as a few eyebrows. I also imagine that the poor clerk is also taking his/her place on the "Bone Pile" today.


- Black Blade

BlackjackJapanese Banks keep falling#8654110/03/02; 23:24:58

Tokyo, Oct. 4 (Bloomberg) -- Japanese stock benchmarks fell, led by banks such as UFJ Holdings Inc., after the regulator reaffirmed that he may adopt policies that will require weaker lenders to erode capital.

NTT DoCoMo Inc. surged, poised for its biggest gain in 21 months, after Morgan Stanley Japan Ltd. upgraded its rating, citing sustained profit growth at the nation's biggest mobile- phone company.

The Nikkei 225 Stock Average fell 8.92, or 0.1 percent, to 8927.51, reversing an earlier 0.8 percent gain, as of 1:46 p.m. in Tokyo. The Topix index shed 0.78, or 0.1 percent, to 882.81, with banking stocks the biggest decliners.
Financial institutions, banks, insurers are feeling the pain
of crushing debt problems. The Weakest Links must go down.

Black BladeFrom The Mail Bag#8654210/03/02; 23:38:52

Black Blade: I get some "interesting" bits of news in my mailbox but the following really lays it on the line:

Yesterday brought news that the poor hopeless schmucks were standing in line to get bigger mortgages; there were a record number of mortgage requests last week. Refinancings at lower mortgage rates typically help cash flow even while they make the balance sheet worse. Consumers end up with a bigger mortgage, but lower monthly payments. But recently, a hint of desperation has crept into the refinancing statistics. "They're refi-ing to get another $40 a month in their check," reports Michael A. J. Farrell of Annaly Mortgage Management.

Black BladeAyman al-Zawahari killed in Afghanistan: Report#8654310/03/02; 23:40:27


The second-in-command of Osama bin Laden, Ayman al-Zawahari, was killed in Afghanistan, Russian news agency ITAR-TASS said on Thursday. In a report from Islamabad, it cited sources as saying that Zawahiri was killed in a special operation carried out by unidentified individuals. It did not give any date.

Black Blade: Maybe – maybe not.

BlackjackTrust Trust Trust the numbers!#8654410/03/02; 23:43:40

Zurich, Oct. 4 (Bloomberg) -- Switzerland is emerging from its longest recession in 20 years. Or is it?

Economists are having a hard time telling. The government said Europe's seventh-largest economy, home to Nestle SA, Novartis AG and ABB Ltd., contracted for four quarters through March instead of one as originally reported three months earlier.

The surprise revision, which sent bond yields plunging 24 basis points in five days, wasn't the first time government statisticians have missed the mark. Economists at Credit Suisse Group and other banks are relying more on their own figures, and some of them plan to recommend improvements to the government, which publishes detailed information on subjects such as lady bugs yet has only two people researching gross domestic product.

``Swiss statistics are open to criticism,'' Credit Suisse economist Martin Neff said. ``We know, for example, how many insects there are, but we have to wait till the end of September to find out about some second-quarter reports.''

Economists are also skeptical about the government's assessment that GDP expanded 0.4 percent in the second quarter. In the previous quarter, the State Secretariat for Economic Affairs revised figures by as much as 0.9 percentage point.

Big revisions harm credibility and leave some clients ``pretty angry'' because they may have made wrong bets on stocks, bonds or currencies, said Jan Amrit Poser, head of fixed-income research at Bank Sarasin & Cie.
Washington, Oct. 4 (Bloomberg) -- The U.S. unemployment rate probably rose in September as the economy added the fewest jobs in five months, a survey of economists showed in advance of today's Labor Department report.

The jobless rate probably climbed back to 5.9 percent last month as payrolls grew by 6,000, based on the median of 61 forecasts in a Bloomberg News survey. The jobless rate had fallen to 5.7 percent in August from 5.9 percent in July. Job growth has averaged 40,500 for the past four months, following a decline of 21,000 in April.

Unemployment is expected to average 6 percent for the final three months of this year as the economy's rebound from recession generates few jobs, a separate Bloomberg News survey showed last week. SBC Communications Inc. and Fidelity Investments are among companies announcing job cuts.

``We are not generating enough new jobs yet to offset the layoffs,'' said Gary Thayer, chief economist at A.G. Edwards & Sons Inc. in St. Louis. ``Until we see that change, the employment picture may not get a lot better.''

The Labor Department is scheduled to release its report at 8:30 a.m. Washington time. The expected rise in September payrolls would follow increases of 39,000 in August and 67,000 in July. In April, unemployment rose to an eight-year high of 6 percent.

``Job creation probably needs to average about 125,000- 150,000 per month to hold the unemployment rate steady,'' said Steven Wood, chief economist at FinancialOxygen Inc. in Walnut Creek, California.

Yesterday, the government said the number of workers filing for state unemployment benefits held above 400,000 for a sixth straight week, a level that economists say points to slow recovery in the labor market.
What are the Lemmings to trust? What revisions? When?
Recovery? When? Over 400,000 level means recession, not slow recovery! "Big revisions harm credibility and leave some clients ``pretty angry'' because they may have made wrong bets on stocks, bonds or currencies". Maybe the Sheeple will get angry!

BlackjackArafat to be taken by force#8654510/03/02; 23:53:46

The Israeli military has been practising a military operation to seize Palestinian leader Yasser Arafat and fly him into exile, reports say.

Israeli security forces have confirmed the news, first reported in Israel's Maariv newspaper, to international news agencies.

Some members of the Israeli cabinet are known to be in favour of expelling Mr Arafat but have faced opposition from other ministers, the military and the United States.
Looks like Israel will exile Arafat by force soon.

BlackjackBill Gross gambles on Brazil!#8654610/4/02; 00:23:32

Sao Paulo, Oct. 4 (Bloomberg) -- Bill Gross and Mohamed El- Erian of Pacific Investment Management Co. are sure that Brazil won't default on its debt.

They are adding to the roughly $1 billion of the country's dollar bonds they owned as of June 30. Brazil's bonds have lost more than a third of their value over the last six months as other investors sold.

Gross manages Pimco's $60 billion Total Return Fund, the world's largest bond fund. El-Erian oversees Pimco's $7 billion of developing nation bonds in various funds, part of the $280 billion in assets managed by the company, a unit of Alliance AG.

``Brazil has the willingness and ability to make its debt payments,'' said El-Erian. ``Those who are betting on a Brazil default are likely to lose. We're bullish on Brazil because it is a good buy at these levels.''
Pimco's confidence that Latin America's biggest country won't default on about $300 billion in public debt stands in contrast to other Brazilian bond investors.

Investors polled by J.P. Morgan Chase & Co. last week believe there's a 45 percent probability Brazil will default within a year if frontrunner Luiz Inacio Lula da Silva becomes president, up from 33 percent a month ago. The survey covered 184 bondholders with $132 billion of developing nation debt.

``Brazil is destined for a bad ending,'' said Jonathan Binder, who helps manage about $600 million in emerging market bonds at Standard Asset Management in Miami. Standard Asset sold most of its Brazilian holdings earlier this year

Lula leads his closest rival, Jose Serra of the current ruling coalition, by 28.7 percentage points in polls released last night. Brazil has a 36 percent chance of defaulting within a year no matter who wins, the J.P. Morgan survey said.

Investing in Brazilian public debt now is ``no different than gambling,'' said Mead Welles, a money manager for Octagon Asset Management LLC in New York. Welles said that he sold all of his holdings of Brazilian public debt over the last two months, about 10 percent to 15 percent of Octagon's portfolio. Welles wouldn't say how much Octagon currently has under management.
This is toooo rich. Bill Gross is gamblin' big time with
investors money. Brazil don't got it. More bad news to come.
How can Bill face millions on CNBC and explain this one???

slingshotGandalf the White Msg#86535#8654710/4/02; 01:46:14


Inlight of your post I have reveiwed many of my posts referring to the Siege Engine story. I have come to this conclusion and without going into too much detail.
Siege Engine will be referred to as OUR story and not MY story.

Black BladeEnron - Anatomy of Greed#8654810/4/02; 01:47:42,,630-433071,00.html


"They transferred me to another project on the other side of the world." He paused. "Like I said before . . . the rule was always no bad news. The system was designed to make people rich without making real profits. The goal was to keep the stock price rising and the doubters muted — usually by sheer confusion. We would reorganise the company every six months just to keep the accounting books in limbo and the auditors on your side."

"See, everyone makes the mistake of thinking Andersen and Enron are separate companies. There are hundreds of ex-Andersen people inside Enron, a bunch of young kids just out of college. Give those new Andersen kids a downtown loft, a new Lexus and show each one the golden path to becoming a partner. They learn to do things the Enron way, and they may never understand the liability of it — until it's too late."

"I'm an old man now. I'm not going anywhere." He sat back in his chair. "I had a very lucrative career." He paused as he looked out into a meaningless direction. "But it cost me my soul."

Black Blade: Interesting account of how things were done (or not done) at Enron from the inside. Of all the similar companies and the go-go 1980's and 1990's this is probably just one story that could be repeated hundreds of times. Like I said, see one cockroach it's a sure bet that there are many more. Think WorldCon, Global Crossing, Tyco, Adelphia, Qwest, ImClone, etc.

slingshotBlack Blade Msg# 86548#8654910/4/02; 02:40:23

Good to be King

It's good to be King, if just for awhile

To be there in Velvet,yeah: to give them a smile

Its good to get high and never come down

It's to be King of your own little town

Yeah, the world would swing if I were King
Can I help it if I dream from time to time

Tom Petty, Wildflowers, Good To Be King.


Black BladeMarket Indicators #8655010/4/02; 02:51:29

US Market Index Futures are higher, the USD is slightly higher, Gold is slightly higher, and petroleum is solidly gaining ground after yesterday's trouncing. Today at 8 am EST the unemployment data comes out and a higher unemployment number will put pressure on the markets. Consensus estimates is for a rise in the unemployment rate from 5.7% to 5.9%. This could weaken the USD and boost Gold.

- Black Blade

slingshotStock Market#8655110/4/02; 03:18:28

By The Numbers

If I ever lose my faith in you

There will be nothing left to do.

Sting, Ten Summoners Tales.

slingshot(No Subject)#8655210/04/02; 05:08:04

Anybody out there?

steadyhere#8655310/04/02; 05:30:13

im not totally out there but according to some of my friends who havent read another nor taken the time to think gold thru im out there but im here aristotle, want some coffee? kona gold this a.m.
gold and silver honest money for honest people!

slingshotLast Call#8655410/04/02; 05:38:15

Good morning Steady,
Working second shift. Need to catch some zzzzzzzzzzzz.

CometoseOut Here#8655510/04/02; 05:55:39

I've been crying wolf for so long,,, my friends relatives and acqaintances , I'm sure, have hardened earlobes..
The art of communication, I haven't mastered yet.....
If I sing I might get more attention and If I sing with a foreign accent to a new crowd , I'll get more attention.

" When all the bangsters ,traders,and merchants
........... all over the world,
trade gold and silver for fiat , That will be a new day....Lord won't you come,,,, Come a New DAY...."

Seems very quiet this morning and calm.......
.....maybe it's the quiet before the storm..........
Time for some hot chocolate to accompany the new dawn.
Morning , gentlemen.

TopazBond yield update.#8655610/04/02; 06:22:47

Long Bond appears to be resisting a move to 4.5%...Will that be yet another Maginot Line?....or the trigger point for full blown Hyperinflation / Dash for Cash.

Lot's rest right here methinks!

Paper AvalancheHere as well - patiently waiting...#8655710/04/02; 06:25:05

to see what caused the sell off in JPM yesterday. Hoping that TPTB know of an impending spike in POG going into the weekend. Why stop hoping now.


Golden BearGreetings to all...#8655810/04/02; 06:43:19

from the land of Oz. It's Friday night here, and getting ready to pull an all-nighter watching with interest the US markets unfold, and JPM unravel further. JPM's chart is looking horrid, and is breaking support, but who knows, another prop up by the PPT may be on the cards...

Well well well, the US jobs data goes -43000, but last months revised up 67000, so unemployment rate drops to 5.6%

Whose doing the books for the labour department, Andersen!?!

Anyway, hope you all have a golden day...


knotakareBill Gross, the IMF, Brazil and the PPT#8655910/04/02; 06:47:52

It is interesting to see Bill Gross making larger bets in Brazil at such a precarious time. My first thoughts were that Pimco is taking riskier bets to offset the other losses they see coming in their portfolio. But this is not logical, because it only increases their risk profile. And at some level it definetly puts more downward pressure on the dollar, which can't be good for their portfolio either.

But it may be that Gross sees that a Brazilian default causes irreprable damage to the US financial system, and so these funds are being invested to plug a leak, not strictly as an arm's length transaction. I pray this is not true, because it shows that the fiduciary responsibilities to private investors is totally breaking down in the US.

I have been lurking here for the past 9 months, and have benfited greatly by everyone's insights. And also am a new customer of Centenial.


Golden Bearknotakare (msg#: 86559)#8656010/04/02; 07:01:21

Welcome kak,

your comments reflect what I was just reading at The Daily Reckoning, by the Mogambo Guru - everything is so intertwined that losses in one area cascade through the global system, not a pretty sight...

But owning bullion, it's only natural for you to select the posting handle you have :)


barnacle billOut Here Msg#86555#8656110/04/02; 08:46:02


I know exactly what you mean. I have told friends, relatives, and even total strangers. Usually all I get is a blank stare; other times various platitudes are mumbled, or outright denial.

Your talk about singing reminded me of a line from the song THE BOXER by Simon and Garfunkel.

"A man hears what he wants to hear

and disregards the rest."

sector@PaperAv The JPM Fall...The Mexican Silver "Production Shortfall"#8656210/04/02; 08:48:43

...may not be all gold related

Their derivatives in general, may not function in a steadily falling market. Or a historically low and unstable [to the downside] interest rate regime.

Moreover the indictment of Andrew Fastow may have something to do with JPM's jitters.

He hasn't cooperated, said nothing and must therefore have a defense of some kind. That defense might include proof that he and others followed "guidelines" from JPM higher-ups. After all, Mahonia and Yosemite were created specifically for the purpose of hiding debt and evading accounting was what JPM DID for a living.

Insiders may see everything coming to pieces.

On another note, I'm intrigued over Mexico's "Production Shortfall" of 22% in silver AND Barrick's "Production Shortfalls" in gold.

Well established mining entities just don't pop up with 22% GOTCHAS out of left field. It would be as if all the excavation stopped for 3 months and everybody took a quarter-long siesta.

The world would have heard about something like that long ago. As for the grade excuse, forget it. The Mexican sites are homogeneous at the specified grades. In other words, they would have to move to another site to find lower grades. ANY excavation at their sites yields standard grade ore.

So there can be only ONE explanation for the Mexican "Shortfall". They didn't HAVE a shortfall in silver production. They shipped the silver off balance sheet and off books, most likely at a much higher price that is quoted on the COMEX.

A kind of producer's black market in precious metals.

sectorGlobal: Sinking #8656310/04/02; 09:12:18

Oct 04, 2002

Stephen Roach (New York)

Suddenly, there's a sinking feeling again. And it's truly global in scope. From Asia, to Europe, to the United States, and to Latin America, the world economy seems to have lost any semblance of upward momentum. The case for a year-end acceleration appears to be in tatters. An engineless global economy is simply lacking in any real source of growth. It's starting to feel like a global double dip.

America, of course, is to blame for all this. In a US-centric world, global economic growth draws its sustenance from the ups and downs of the US economy. At market exchange rates, the US has accounted for 64% of world GDP growth since 1995; on a purchasing power parity basis, that contribution is closer to 40%. No matter how you cut it, since 1995, the United States has accounted for twice as much world GDP growth as its share in the world economy might otherwise suggest. When America booms, the rest of the world goes along for the ride. When America sags, the rest of the world sinks like a stone. And that's precisely what's going on at this key juncture in the global business cycle. But the rest of the world certainly deserves its fair share of the blame. Lacking in autonomous domestic demand, the non-US world is beholden to the whims of the global trade cycle. And with the US the engine of global trade, America's latest spate of growth problems has been magnified in the world at large.

The party is over. Nobody wants to believe it…but the party IS over.

PizzSector#8656410/04/02; 09:32:47

Mexican silver and JPM's worries.

Makes sense on both counts. The silver shortfall intrigues me the most. If your a monied user and there is any type of supply problem as has been suspected for years, a back door deal at realistic prices for consistant delivery is a no brainer. Corporations have paid bribes to foreign entities for years (one way or another).

If the silver jewelry scam has merit, it would also confirm the supply problem, and the foreign trinket producers wouldn't have the incentive for pure silver as say someone who's making circiut boards, film, etc.

I also sense that the jig may be up for PM market manipulation. Too much evidense and too many "little" things popping up (or coming clean). Martha looks like she maybe a prison calendar girl, and if they'll prosecute her, they'll prosecute anyone.

Wonder what the current price for good false ID's and safe haven transport are: JPM should have some type of derivative on them, wouldn't you think . . .

Sector. thanks for the excellent deductive reasoning.....


DracoJPM falling off a cliff this morning#8656510/04/02; 09:42:02

Heavy selling of JPM shares this morning. Stock is down 3.5% and just touched $17 a share. Things are looking very "GRIM" for the banksters in general.

These are the times that try men's souls......

OperativeWife of Central Banker May Have Close Ties to Terrorists??#8656610/04/02; 09:43:19

No comment, its too bizarre!
OperativeBrazil - Pre-election Update#8656710/04/02; 10:15:40

17 page PDF file that spells out the players and parties involved. Light on issues, but the overall consesus is there is much at stake for Brazil. One can surmise that JPM and the other banksters are sweating this one out. Possible huge debt defaults?? You bet!!
sectorJewellery retailers Not Doing So Great#8656810/04/02; 10:15:41

Thurs. Thurs. Change($) Change(%)
Sept 26 Oct 4

Finlay(FNLY) $15.45 $16.32 $0.87 5.63%
Friedman's(FRDM) $7.79 $7.52 ($0.27) -3.47%
JC Penney(JCP) $18.96 $15.14 ($3.82) -20.15%
Neiman(NMGa) $30.56 $25.77 ($4.79) -15.67%
Nordstrom $20.19 $16.97 ($3.22) -15.95%
Tiffany(TIF) $23.42 $22.64 ($0.78) -3.33%
Wal-Mart(WMT) $53.71 $51.07 ($2.64) -4.92%
Whitehall(JWL) $10.73 $10.08 ($0.65) -6.06%
Zale(ZLC) $31.57 $28.99 ($2.58) -8.17%
Down Jones Avg. 7997.12 7717.81 -279.31 -3.49%

Paper Avalanche@ sector - JPM#8656910/04/02; 10:21:44

I agree with your assessment. This is beginning to look like the perfect financial storm as decsribed by Jim Pulpava.

Have a great weekend.


Paper AvalancheDid you ever wonder....#8657010/04/02; 10:25:58

Who else from the following list may also lurk here among us on this forum to gain insight:

JPM / Citi
Treasury Dept.
Bullion banks
Hedgers (Barrick, et al)
Financial media

I would be curious if anyone here would happen to have conclusive or anecdotal evidence that we here at the mighty oaken table are impactful on any of these institutions via the content and insight that we provide one another.

I like performing for a big audience.

Paper Avalanche

PizzSector#8657110/04/02; 10:29:54

Do you play chess? the way your mind works, if you don't you should. If you do, love to play a few with you. Probably kick my rear, but. . . .


OperativeSector & Paper Avalanche#8657210/04/02; 10:44:27

Would you two please help lower the bar for JPM, seems they want to try shooting for under 17.00 today. JPM currently at 16.98. Also, can the castle arrange a little limbo music before the next act?
kasperjackCredit Suisse On The Edge#8657310/04/02; 10:45:20 Credit Suisse moves to quell capital rise fears
Friday October 4, 12:12 pm ET

By Knut Engelmann

(Adds banking regulator, updates share price)

ZURICH, Oct 4 (Reuters) - Credit Suisse insisted on Friday it was
capitalised, hoping to quash fears it might be forced into a huge
share issue
which sent its ailing stock down over 15 percent to their lowest in
more than nine

"The group's present capital
resources remain adequate capital increase of
the group is planned," the
second largest Swiss financial
group said. It said it saw no
"objective reasons" for the
plunge in its shares over the
past two days.
Panicky Pete alert!

sector@pizz I do play chess but my brother is much better#8657410/04/02; 10:48:08

I havn't played in about four years

Been devoted to solving the gold scam mystery.

Once one fully grasps the nature of one's enemy, in this case ruthless, one has a big advantage. It's the average guys that have a hard time sorting out macroeconomics.

They simply can't conceive that their government is run by vicious thieves.

PizzPaper Avalanche#8657510/04/02; 10:50:56

Many times. I've conveniently noticed some of the second tier media stringers picking up on some discussions and seeing articles a few days later that are just a little too close to what we banter back and forth.

Regarding the government, FED, JPm, etc. If GATA's right, and you'd been playing with the PM market for 10 years, How could you not lurk? Keep your friends close and your enemies even closer. . . .


sectorCredit Swiss may be a BIG counter party to JPM's derivatives#8657610/04/02; 10:53:40

But is everybody else in derivatives land

There is clearly unannounced news or conditions that draggs JPM AND Credit Swiss down this week.

They will probably swoon at the bell.

Remenber, seeing the CSFB press release, that "Nothing is confirmed until it has been officially denied".

kasperjackCorrelation Broken Between Gold AndFinancial Meltdown#8657710/04/02; 10:59:44

Thanks Chuckhiller

More Banks With Issues
by: chuckhiller (53/M/Akaroa)
Are we entering a crisis stage?

"Northern Trust Corp. and Hibernia Corp. became the latest U.S. banks to
disclose lower earnings because of declining returns on investments and
growing loan losses.

Mortgage refinancing cut into profit at Hibernia as interest rates near 40-year
lows prompted homeowners to replace higher-cost loans, Louisiana's biggest
bank said. Chicago-based Northern Trust, which manages $327 billion of
assets, said it lost money on an Internet investment and faces growing
defaults among borrowers.

Regulators are pressing banks to provide a more realistic accounting of their
loans and investments and to increase reserves for bad debts as slow
economic growth takes a toll on industries from telecommunications to
energy and airlines. Shares of every bank in the 24-member Philadelphia
KBW U.S. banking index fell for a second day.

``The regulators and the companies may have been too lax in recognizing
some of these problems,'' said Frank Barkocy, research director for Keefe
Managers LLC, which manages about $125 million of assets and owns
financial services stocks. ``As the economy weakens again, these problems
are not going to disappear anytime soon.''"

Regulators have gotten lax? Why!!??

!!! OH MY !!!

Bigger story (IMO), as regulators now start to scrutinize banks, eye is/has
being taken off bigger issues regarding insurance regulators. Not absolutely
certain about this, but time will tell.
We have our own version of a Japanese financial crises brewing amongst banks insurance pension funds insurance et al. Usually gold benefits from such uncertainties.

OperativeThought of the Day#8657810/04/02; 11:04:55

• Today's Thought:
"If asked for a brief explanation, I would say that the existential vacuum derives from the following conditions. Unlike an animal, man is not told by drives and instincts what he must do. And in contrast to man in former times, he is no longer told by traditions and values what he should do. Now, knowing neither what he must do nor what he should
do, he sometimes does not even know what he basically wishes to do. Instead, he wishes to do what other people do - which is conformism - or he does what other people wish him to do - which is totalitarianism."
- Viktor Frankl |

PizzSector#8657910/04/02; 11:13:16

On derivatives.

If memory serves me correctly, the new bankrupsy law goes into effect at year end. It is supposed to cover the derivatives issue and allow for offsets.

If a JPM went under, the creditors would have the right to all the above water derivatives and walk from the underwater ones. This would have a chain reaction through the counterparties, having to pay up on their bad derivative positions and write off their good ones.

In other words, an example to get the idea would be if I go bk and am long gold @275 and short silver @5.00, under present law the creditors get the asset of the gold position, and the loss in silver is discharged.

The right of offset will be challenged by any major creditors in my opinion because they are separate contracts. The real problem will be if they try to offset all PM derivatives, regardless of metal types, energy derivatives regardless of energy types, etc.

Going to be one of the biggest, ugliest, legal and accounting mess the world has ever seen. . . .If they're smart, they'll just shut down the whole system for a month or two and start over. . . . .


Gandalf the WhiteWELCOME Sir Knotakare !!!#8658010/04/02; 11:15:23

knotakare (10/04/02; 06:47:52MT - msg#: 86559)
I have been lurking here for the past 9 months, and have benfited greatly by everyone's insights. And also am a new customer of Centenial.
Thanks for your first post, "NOT-a-CARE" <;-)
That "handle" took the Hobbits a while to "decipher".

kasperjackKeiritsu And The Derivatives Matrix#8658110/04/02; 11:18:49

Thoughts On Mass Psychoses Enveloping The World Economy

Different entities. One innvolves a gordian knot of
interlocking ownership amongst Japanese banks
businesses and the government. The other innvolves
a gordian knot of interlocking relationships amongst
American banks businesses and the government.
These two cancers appear to be inoperable. One of
them has locked the Japanese economy into a 10 year
depression. The other one appears to be about to do
the same to the American economy. Yet Alan
Greenspan lobbies vociferously against control and
regulation of the derivatives market. Why?

PizzOperative#8658210/04/02; 11:23:32

Maybe you don't know what you want to do, but this guy is, at least for two days, going to one of the more beautiful spots in the world, Lake Chelan, in north central Washington State and play a couple rounds of golf in 75 degree sunshine (if the forcast holds).

Have to do something, this dock strike has hit Seattle's psychic big time. It's starting to be reminisant of the early seventies in attitude when you could see whole families hitch hiking out of town and billboards requesting that the last person leaving the city, please turn out the lights (true story).

This area right now, IMHO, is the mine canary for the rest of the economy. We've got the worst in the nation, and it looks like one real cold winter. . .


Gandalf the WhiteHave a GREAT Golfing Weekend, Sir Pizz#8658310/04/02; 11:29:08

The Hobbits just remind you NOT TO HIT THE BIRDIES !

AristotleStrad Master and Black Blade on the fate of Bear Stearns#8658410/04/02; 11:29:34

Brief recap:
Strad says, "Regarding the guy who's finger slipped while placing a sell order for 4 million dollars worth of stock... They say that it doesn't affect anything. Hmmm... Doesn't all that stock, in theory at least, belong to someone? What, exactly do you think they will tell the holders of all that stock?"

Black Blade answers, "...the order was for $4 million and that $622 million actually went through before the transaction was cancelled... they claim that there is no "material effect" on the company... It usually is the responsibility to make their clients whole... I also imagine that the poor clerk is also taking his/her place on the Bone Pile today."
- - - - - - - -

I dunno guys. I think Bear Stearns is happier than a pig in mud about this so called *mistake*.

Looking at the outcome we can say that, effectively, the company sold the $4 million in stock as ordered, and then basically shorted it by an additional $618 million. Planned or not, it strikes me as having been a very profitable move -- selling high and buying back low. After all, the market has continued to fall solidly since that time. This "mistake" turned out to be a smart move. A very *very* smart move. Can you guys see it this way at all?

What are the chances that they really DID want to short $4 Billion worth, and some "agent" stepped in and told them to play ball, forcing them to halt the sale mid-stream and to invent a cover story so as not to rattle the investing public? Well..., wouldjajust look at me now... I sound like a conspiracy dude!

Gold. Get you some. --- Aristotle

kasperjackKeiritsu and the Derivatives Matrix#8658510/04/02; 11:31:32

Keiritsu was responsible for the Japanese miracle.
Derivatives are responsible for the extension of the
American fiat empire. A regular banksters buffet huh?

Pizzkasperjack#8658610/04/02; 11:32:56

Regulate derivatives?? Bring to light the largest bank, fund, and insurance compay heist in the history of the world by a bunch of offshore entities, hedge funds, etc.

Not if they can help it. Besides, if they can figure out some way to keep slowly unwinding this crap, the time element will make a lot of these things go away. Kind of like their own built in statute of limitations. . .


Sierra MadreChess playing...#8658710/04/02; 11:37:02

I was pretty saucy about playing chess when I was seventeen.
Invited my dad to a game.
He quietly checkmated me in three moves.

Will Brazil be the last straw?

From a lecture by Ferdinand Lips, "Why Gold-Backed Currencies Help Prevent Wars":

The Life Span of Currencies [during the era of the gold standard]:
French Franc 1814-1914 100 years
Dutch Guilder 1816-1914 98
Pound Sterling 1821-1914 93
Swiss Franc 1850-1936 86
Belgian Franc 1832-1914 82
Swedish Krona 1873-1931 58
German Mark 1875-1914 39
Italian Lira 1883-1914 31

Lips's Lecture was delivered at the X Congress "Mut zur Ethik" (Courage to Take a Moral Stance) held in Feldkirch (Austria) August 30-September 1, 2002.

Question: Can any institution ever be restored?


PizzAri#8658810/04/02; 11:41:17

I'm thinkin on the same lines, kind of like Bear Sterns tried to slip about 4 bil. out the back door right at the same time the PPT or whomever was trying to push the markets up.

The selling started just before 3 from what I could see, not a dump in the last 20 minutes. Best way to slow down a traitor is publicize him. . . all it takes is one big player to quit playing and the rats start scurrying.


Operative@ Pizz - Sunshine in Seattle?? #8658910/04/02; 11:48:31

Well, all I can say is if the Good Lord is giving out two, back to back, days of sunshine to Seattle, you have a great plan to take advantage of such luck.

As for me, I do know what I want to do,... trouble is my wife has other plans.

Enjoy your weekend!!

sector@pizz Shutting Down the System#8659010/04/02; 11:50:23

When JPM files ch 13

The COMEX will be forced to default in gold since JPM can't deliver back to it $45 billion in shorted metal.

Whoever guaranteed JPM backing on this trade [The US Treasury] will probably remain silent since THAT would require current and past Secretaries of the Treasury to "swing". That silence will mean a COMEX default...thye just stop carrying a gold contract and settle in paper. This would dishonor the entire NYMEX/COMEX market operation...everything from sugar to coffee.

That scenario is my leading candidate.

Might makes right.

GoldnSilver2002oh oh another clerical error!#8659110/04/02; 11:50:28

Wow,jpm and citibank on the skids dow down over 200 from another clerical error sell off and gold only up 70 cents!!!Gold and silver stocks havent moved for days!Can someone explain to me how they exert such amazing control as the house burns down around them?Ok now JPM is under 18.50,gold is at 322.Just a thought but is it possible when peole take their money out they just hold cash?Or are their losses so great and the debt burden so high they have no more money to invest in anything?I can see now why the general public doenst flinch and buy gold,these movements just arent exciting.JUst think if the dow goes up 100 on monday gold will lose 3 dollars but if dow goes down 200 gold barely moves.Manipulation or not until gold starts really moving the public will have to put cash in their matresses,where else will they put it,JPM or citibank?lol.Im not trying to demoralize anyone but i see the bads news growing and growing and gold goes no where.Does that mean if there is any good news gold will drop again?What am i raving about?Well to be honest there has been more than enough reasons for gold to take off and yet it doesnt?What is it really going to take and please dont say when jpm closes under 15!
Thanks any advice is appreciated,but why shouldnt i wait a month or two to buy more gold maybe it will go back down to 308'see what i mean?

PizzOperative#8659210/04/02; 11:55:11

Don't know where you hail from, but the State of Washington has this nice little range of mountains down the middle called the Cascades. Seattle being on the west and wet as heck, but the eastern side of the state has ponderosa pines on the east slopes (like the Lake Tahoe area, and Lake Chelan is like Tahoe in climate). From there is even gets dryer as you go east to Spokane, lot of wheat fields, etc.

Fall is pretty nice in Seattle also, we've had only one day of rain in the last three weeks, highs in high sixties, low seventies and mid 40 degree nights. Love this time of year,

Now, if we only had an economy left. . . . .


AristotleGolden Bear, I saw yesterday's post#8659310/04/02; 11:56:05

Thanks for rising to the challenge and voicing your answer. I liked it!

--- Ari

Sierra MadreSector: comments on silver "Shortfall" as suspect#8659410/04/02; 12:16:38

Have been forwarded to people who should know, in Mexico.

Also, Stephen Roach's highly significant commentary on the stalled engine of world growth.


sectorSilverngold2002 - Waiting several months to buy gold?#8659510/04/02; 12:20:50

why isn't gold rising today of all days?

The short answer is the bad guys are selling their treasuries dry today in order to keep pog away from the death zone of $330. Barrick's toxic hedges are intertwined with the cabal's...they are BOTH diving today.

The answer to when should one buy gold is as soon as you can since trying to time a manipulated market is foolish. Especially a manipulated market that has drawn a school of voracious shark hedge funds who plunk down $100 Million a DAY in the COMEX trade.

What is $8 per ounce in landscape of ultimate $1000 plus per ounce gold?

Doubting that?

Why did Canada just issue a year's plan to raise their interest rates by 225 basis points today? Because they see inflation...BAD inflation.

Since our economies are joined at the hip they seen inflation HERE TOO. That in spite of a hamstrung FED trapped between a rock and a hard place.

There is a massive disintegration of the US economy taking place. From the bogus GDP numbers[Ruined by hedonic "estimates"] to the bogus productivity numbers linked thereto to the bogus employment numbers [restated monthly] to the bogus corporate earnings numbers[Gained by robbing pension funds], to the bogus commodities markets [where shorts are favored by rule] to the bogus Wall Street markets [levitated by government repos] to the bogus regulators who ignored galactic corruption to the bogus interest rate mechanism [put in place by the Knight of Conflicts of Interest(Bank of International Settlements), Sir Greenspan] to the bogus gold market upon which ALL the other scams rest.

Rest assured that the enemies of gold are hurting today since they must cough up that much more gold metal to sell against a rising tide of taake-no-prisoners hedge funds as the cabal's plans fragment, their futures dissolve and their safety crumbles.

USAGOLD / Centennial Precious Metals, Inc.The assistance you want and the professionalism you need.#8659610/04/02; 12:21:23


Take a look at the developing upward channel on the gold graph.

spot gold price

Now's the time to add gold to your portfolio.

For portfolio guidance attuned to YOUR needs,
contact us at USAGOLD - Centennial Precious Metals.


We've been serving investors for three decades.
Let us help YOU.

Rock"Red October"#8659710/04/02; 12:35:53

Hey all you beautiful people just stopped on by the castle to say hi. Paper Avelanche you wonder if any of the big wigs like JPM are reading the insights from this forum provided by USA Gold. Anyone visiting the castle with half a brain would know that these walls contain some pretty smart individuals thats for sure.

Hot off the press, they just arrested 4 of 6 more terrorists in Oregon today. I'm glad the FBI and CIA are finally doing their job. That last FBI director Louie Freed was a real lame duck, I'm glad they got rid of that loser. He won't even give an interview.

And I thought that was pretty lame for the Democrates to come out with that recent cartoon on the web and TV about G.W. Bush mistreating seniors by shoving them down the steps in a wheel chair. As an independent voter I'm not pushing any candidate but when we're at war with terriorists and getting ready for war with Iraq for the Democrates to take a cheap shot like that to our Commandr and Chief makes me furious. I hope when people vote at the primaries this November the Democrates lose the Senate. All they have done is bitc- and moan about everything Bush is trying to do with Homeland Security and Iraq. Again, do want that smoking gun to be a mushroom cloud over Manhattan?

Serria Madre that was very interesting data on the life of the other world currencies but how long has the dollar survived? It appears the average world currency only lasts about 75 years or less.

I noticed on CNBC today that its all been bad news. They can't help but report the facts for once, they can't lie about the numbers like they use to. Even though job losses are as low as its been in 22 months the market didn't even flinch. Its down 211 points with three hours of trading left.

Especially in times like this I'm glad I own gold because it really is the only true currency. You can't lose with precious metals IMHO. Silver will wake up one day as it has been as minipulated like the gold market. I never realized how gold competes against the dollar until I started hanging around the castle. Gold is true while the dollar is a lie, its only a matter of time before that lie is exposed for what it is and when that happens all hell is going to break lose.

Well thats enough ramblings for one day. Thanks for listening.

Hey Blade you really sound like your living the good life. Working out at the club, hunting in the canyon. God Bless you my friend, its great to hear success stories. I just got back from slaying the beast myself. Exercise is just as much a part of my life as brushing my teeth. After all if your not in good health what the hell good is owing the world? Have a great weekend all.


RockGoldnSilver #8659810/04/02; 12:44:59

ROFL that was a good one. Yea the Dow is down over 200 points today, it must be another clerical error!
TownCrierGold demand -- others are buying it. Are you?#8659910/04/02; 12:48:16

Extracts from WGC's Rhona O'Connell today:

"Physical demand appears to be increasingly comfortable with the higher entry price ($320 and above) and this is maintaining a cushion under the price."


"The Istanbul Gold Exchange has reported gold imports for the first nine months of 2002 at 99.15 tonnes. Although an equivalent figure was not readily available for the first nine months of 2001, imports in the first six months of the year at 56.4 tonnes were 31.2 tonnes higher than in the first half of 2001."

Golden BearPPT has hit the town big time!!#8660010/04/02; 12:52:34

Couldn't leave their friends swinging in the breeze...
Black BladeStock Market - Up or Down?#8660110/04/02; 12:55:18

Want to bet that the institutional investors and investment houses come in to save the day with some behind the scenes encouragement from the White House? Maybe even a miracle turnaround for a flat or positive finish? Hmmm...

- Black Blade

PizzBB#8660210/04/02; 13:00:02

So far you're 100 points right, but fading again. No one but the government or government backed money would want to committ new long money over the weekend without inside info. . . and that's illegal, isn't it?

Now we have one more upside salvo underway. . . . you may be right


USAGOLD / Centennial Precious Metals, Inc.'Tis the Gather the Fruit of Your Labor#8660310/04/02; 13:04:00

Swiss gold francs
Harvest Time
Whatever it is that you may have sown,
we'll give you the power to reap GOLD.

Centennial has three decades of experience in the field

Sierra MadreRock: why the dollar was not listed along with European currencies....#8660410/04/02; 13:04:20

I noticed the absence of the dollar in the list showing the lifespan of various European currencies.

I guess that the U.S. Dollar was not listed, as having a rather short and tumultuous life, but others who know more of the history of the dollar can give more details.

The history of the dollar in its first years is the history of a nation in the process of formation, as the U.S. is a rather new country (1776).

There was a lot of scrip - improvised paper by fly-by-night banks in the early years, so far as I can recall. (The Mexican silver peso was legal tender in the U.S. until 1857! Believe it or not.)

The Civil War - or "Northern War of Aggression" as some Southeners like to call it - disrupted the monetary system.

Redemption of notes for gold was officially reinstalled in the 1870's, and so my guess is that the history of the gold dollar is from 1870-something to 1933, when Roosevelt did his work. Only some sixty years.

The U.S., with cheap and highly efficient labor - Italians, Irish, Germans, etc. - and very low taxation and little regulation, became a MIGHTY POWER by 1913. The Federal Reserve was created in that year, in order to allow banks the happy privilege of borrowing short and lending long, a greedy banker's dream come true.

By 2002, that MIGHTY POWER the U.S. of A., has been deliberately (IMO) undermined and all that was achieved, has been turned to dust. "Sic transit gloria mundi" (Thus passes the glory of this world.)

God help us all, in what awaits us. Let us help ourselves, by owning gold.


kasperjackFalling Domminos#8660510/04/02; 13:07:42

Reuters Market News
Ebner's Lonza retreat worries Swiss market
Friday October 4, 2:46 pm ET

By Michael Shields

(adds EMS increases stake in Lonza)

ZURICH, Oct 4 (Reuters) - Fears of a fire sale of shares in top Swiss firms
Martin Ebner's debt-laden BZ Group grew when BZ said it would sell its
almost 20
percent stake in Swiss specialty chemicals firm Lonza Group AG
(LONZn.VX) on

News that the maverick
financier Ebner was stepping
down as Lonza chairman
ahead of the sale spooked
the market, which has been
on edge for weeks amid
concern BZ could be forced
to sell assets to repay debt to
creditor banks.


Credit Suisse shares tumbled by up to 15 percent but recovered to close
9.6 percent after the firm said it was adequately capitalised. As well as BZ
holding a stake of under five percent in the bank, its exposure to BZ is
thought to
be around one billion francs.
Not a chance of a snowball in hell huh?

kasperjackEuropean financial Sector Under scrutiny#8660610/04/02; 13:22:24 Banks head Eurostocks slump as DAX hits
6-year low
Friday October 4, 2:39 pm ET

By William Kemble-Diaz

LONDON, Oct 4 (Reuters) - Europe's battered blue chips got
only temporary
relief from a surprise dip in U.S. unemployment, as shares
closed near session
lows on Friday and Germany's DAX index (XETRA:^GDAXI -
News) touched
6-year lows, hurt by a still-weak economic outlook.

Financials, insurers and
banks were hit hardest and
accounted for about half
the fall in leading regional
benchmarks, as rumours
swirled of credit and
earnings problems in the
Yowzers. Storm clouds in the banking sector.

sourdoughU.S. better get it together and give this guy some respect#8660710/04/02; 13:24:37,2276,59438,00.html?

Geez, they crap all over this guy. An attitude adjustment is sorely needed.
This is the guy pushing Islamic gold currency.
This is the guy who told the IMF to take a hike.
This just might be the guy who pulls the Islamic world into a cohesive force.
So, what do they do, when he comes to visit,jerk him around and make him mad.

OperativeFriday going out with a bang.#8660810/04/02; 13:29:24

Dow whippsawing back and forth, some battle going on.
Almost all gold stocks now in the green along with XAU, GOX, and HUI. JPM looks like it is figthing for its very life.
This is getting better than a lot of football games.

@ Pizz, just ribbing you about the rain. You live in one of the best places. Have some friends who live in Washington State and they keep trying to get me to move out there. One is ex DEA, retired, now raising horses and ticking off the tree huggers with his redwood lumber business. He, like you tells me how nice, dry, it is most of the time, but I swear every time I call him its raining.

@ kasperjack, thanks for the posts today, interesting events going on across the pond.

@ silvercollector, dont have any citations cause I have not been caught. <grin> I pick on BB and his elk efforts because I am jealous. The guy is living THE LIFE. Hunting, fishing, and no wife to make a chore list. He has got it made in the shade. With a little luck this weekend, (read, if I get all my chores done) I may get a couple hours to try and run down that flock of turkeys I keep hearing out back.

Paper Avalanche@ sector - Canadian Interest Rate Statement#8660910/04/02; 13:29:46

Greetings sector! I know that I lean on you alot to help me find info, but what you said in your reply to GNS2002 struck me and was wondering if you have any info that you could link in response to the follwing:

"Why did Canada just issue a year's plan to raise their interest rates by 225 basis points today?"

This is huge. This confirms TG/A/FOA's prediction of hyperinflation and the recent reading on ECRI's FIG (thank you again for that link as well).

Please confirm that this is true regarding Canada. You have my full attention.

Paper Avalanche

VanRipSector#8661010/04/02; 13:30:19


"...The COMEX will be forced to default in gold since JPM can't deliver back to it $45 billion in shorted metal."

What you say certainly seems possible in light of everything that has been going on. But if that occurs, what do you think will be the affect on the price of gold? I know some gold bulls that have been salivating waiting for JPM or some other involved party to buy back all that shorted gold, figuring that would boost the price. If it's settled in paper, wouldn't that eliminate that possibility?

Sure appreciate your input.

Paper AvalancheJPM spiraling to it's true value - zero#8661110/04/02; 13:38:22

Paper AvalancheFound it on Google - Canadian % rates#8661210/04/02; 13:41:36

Hey! I am learning to do this on my own!

Hyperinflation is on its way.

Paper Avalanche!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

BoxmanPizz messege #86592#8661310/04/02; 13:54:09

Piz wrote: "Fall is pretty nice in Seattle also, we've had only one day of rain in the last three weeks"

This got me thinking about the energy sector, and whether or not the reservoirs had enough water to supply themselves and northern California with electricity from the hydro plants.

Black Blade, any insight? Is this going to be another major problem for CA, as it has been in the past year or two?

The CoinGuyJPM looking Sickly on the Chart(16.61/-5.73%)#8661410/04/02; 13:56:23


NEW YORK (CBS.MW) -- Another cheerful thought for the market: how about another Long Term Capital Management-type financial derivatives meltdown?

Comment: See link for FNM Article. The volatility is tremendous here. JPM rising on declining volume, and decreasing on advancing volume. Looking like a terminal short; sans government support

The(eyeballs spinning from the volatility)CoinGuy

BoxmanAristotle msg#: 86483--The challenge #8661510/04/02; 14:08:13

Aristotle Wrote:"Here's a challenge to everyone
There are so many merits to Gold in the grand financial scheme of things. The challenge is for everyone to pinpoint within their own opinion the single primary aspect among them all that makes Gold ownership more favorable than a matching dollar-denominated savings account."

For me, it means dealing from a point of strength. There are land mines all through out ones journey in life. I like being prepared for as many uncertainies as I possibly can. I take solace in knowing that I have enough food for my family for years, and in knowing that I have enough weapons and ammo that if I were to run out, it probably wouldn't be worth surviving anyway. There are many other ways that I feel that I am ready, but I think you get the idea.

I am on the high ground, a position of strength, and gold and silver one of the main stengths that I am in possesion of. A dollar-denominated savings account is not dealing from a position of strength.

sector@VanRip - When the COMEX Defaults...#8661610/04/02; 14:12:43 will be very good for gold.

Because gold is a world-wide commodity that trades in numerous markets. Dubai, Shanghai, London, Istanbul, Tokyo, to name a few.

The COMEX default will remove New York and it's bogus trading hours from the price discovery mechanism. The cabal can still go to London and the access market but they will be hamstrung.

This says nothing about the permanent loss of confidence in United States trade regulators who will be shredded.

A COMEX default is wonderful for gold...lousy for those hoping for a melt-up from deep option COMEX positions.

Another point. In the event of a COMEX gold default, the giant hedge fund gold longs are actually playing with a loss floor of zero under them. It would work like this:

Say Hedge Fund A establishes a long position in gold futures. He or she is obligated to by those futures at the COMEX price unless they are rolled or sold. However, if there is no COMEX price because the market is "Halted" those obligations vanish and are settled out for their original purchase price [I'm speculating on this issue but it seems only logical].

Yet the market upward pressure from those futures longs is felt all the way to the default time.

I think it's pretty clear to everybody that the COMEX can't deliver any appreciable metal in a pinch. This strange speculating period is therefore one of gathering resources to apply at the moment of the cabal's selling exhaustion. That moment will flash by so fast it will shock everybody. There simply won't be any time to get any more cheap gold.

With the COMEX in default, the only gold to get will come from abroad with loads of tariffs steel is today.

RockSerria Madre#8661710/04/02; 14:14:23

Thank you for that concise comprehensive answer to my question. I probably should have known the answer myself had I thought about it but after reading your comments I realized that United States Treasury has had two different dollars since it was created. One dollar was backed by gold and the other backed by fiat and the one backed by fiat was created when Nixon was in term because as you know he took the dollar off the gold standard. So I figure the inflated paper is approximatly 35 years old. Since confidence is the life of the dollar.......get some real money get gold!


BoxmanBlack Blade--update on latest from our box plant#8661810/04/02; 14:18:26

Black Blade, I know that you take an interest, and since CavanMan seems to have taken, hopefully, a short respite fom the board, I will tell you of my last conversation with one of my former coworers.

Seems the plant has been working mainly 4 day work days. One of the reasons given was improvements in productivity. I have only been retired for 5 months, so if this were legitimate, they would have to have come up with improvements that were previously unheard of in our business. (Tongue in cheek). I felt like saying balderdash, but refrained.

Something is rotten in Denmark. I will try and stop by our plant one day next week and get more info. (Yeah, I know, I have said that before)

Best of luck on filling the freezer. I hope you also get to part of the kill on the wall.

RockBoxman "the challenge"#8661910/04/02; 14:20:01

Hey Boxman I like that post! Its good to be in a position of strength and I'm basically in the same position and vantage as you are. Thanks for the feed. Its encouraging to know I'm not the only fanatic that thinks like this. haha


OperativePerspective: 6 Month JPM Chart#8662010/04/02; 14:20:47

As the JPM team approaches terminal velocity shown by the chart, I offer up advice in the name of humanity:


Black BladeRe: Pizz, Boxman, Operative and Rock#8662110/04/02; 14:25:36

Pizz – I am surprised. I thought that there would be that "full court press" to keep at least the DOW from looking so ugly. Of course as the gold pits close a couple of hours before the market closes and we don't always get a clear picture of how gold would react. It appears that there are just too many negatives for the market today – 43,000 jobs lost, dockworkers off the job on the west coast, high energy costs, corporate earnings warnings, excessive jury awards, etc.

Boxman – I am not sure how California stacks up for water this year. There is a drought in the western states going on for three years now and a drought through the Midwest that has destroyed crops. California depends a lot more on hydroelectric power from the Pacific Northwest states. California depends much more on NatGas supply and electricity from out of state, so they might have a problem early next year. I have thought about writing up a piece on this as I have some more recent info on energy supply and now that oil inventories are at 20 year lows and threaten to deplete a whole lot more the cost of energy is set to rise and put additional pressure on the economy.

Operative – A bit of overcast weather is moving in and a possible storm. That should get the elk moving from the high country and improve my odds. Also, getting ready to slay some ducks soon. The idea is to have a steady food supply. I may have to consider jumping off the "Bone Pile" soon.

Rock – healthy mind – healthy body. In my case just healthy body if you believe some of my friends. Hmmm…


- Black Blade

sectorCopied from the other gold board:#8662210/04/02; 14:27:11

JPM and The UTES - Why do they trade in similar patterns.

"My Favorite Market Average of the Day

(watingforgolddough)Oct 04, 16:16

You gotta love what the utility average did today. Down 9.77, a 4.64% loss. It sure looks like the utes are leading the way down. I've noticed that the utes tend to move sympathetically to the likes of JPM. Does anybody out there have any thoughts on that observation? Also, does anybody have any technical outlook on the utility average?"

The UTES hate higer interest rates since they have huge fixed capital equipment borrowing costs. JPM hates rising interest rates too since their $18 trillion interest ratres derivatives are [I think] of the low volatility flavor.

Yesterday the Fed as much said they were going to raise rates in 2003. They signalled this by saying "Rates are low enough"...three FOMC governors said the same thing. So rates are going to move up.

The SM is going to drop like a stone when the 30-something portfolio "Managers" finally get this Fed hint.

BoxmanRock, thanks.#8662310/04/02; 14:28:33

We may be in the minority, but one thing that I have noticed is more people making comments like "I bet you are glad that you have all of that stuff". They may not do anything to protect them and theirs, but they don't chastize me as they used to, not that it ever bothered me. Some of the herd are lifting their heads and smelling the air with nervousness.

I did finally convince one of my brothers to purchase gold. Was I ever surprised with that phone call. He's kind of a mountain man, so to speak, so he has many of the other bases covered, and dealing from a position of strenght.

kasperjackThe Banking Collapse for Dummies#8662410/04/02; 14:30:23 w OCTOBER 7, 2002


The Breakdown in Banking
Trust is eroding, and profits may follow as business models falter

In the 1990s, the sky seemed the limit for financial institutions. Once restricted to taking
and making loans, banks broke into the business of selling securities. Wall Street
houses began making loans to companies. The result was a flood of money to promising
companies, existing businesses, and consumers. That fueled the New Economy with its
productivity growth and made the American financial system the envy of the world.
Moreover, the
financial system seemingly sailed through the 2001 recession and the accompanying
stock market
decline in good shape. Commercial banks had record profits in the second quarter of this
year, and
their balance sheets were far stronger than in previous recessions.

That's a small part of the unprecedented wave of bad debt flooding the financial system.
A record
$880 billion worth of corporate bonds and loans are distressed or in default, according to
I. Altman, a professor at New York University's Stern School of Business. As the losses
the biggest firms are facing the threat of legal action from investors who see themselves
as the
victims of a massive con game.

At issue is the economic recovery. Banks are indispensable links in the flow of money,
and they
must be perceived as honest players. Yet after a year of revelations about their
practices and conflicts of interest, investors have become increasingly skeptical of
everything Wall
Street sells.
Preparing the populace. Banking collapse for dummies...

BoxmanBlack Blade msg#: 86621)/ excessive jury awards#8662510/04/02; 14:48:51

Excessive may be an understatement. In stead of awarding this family $26 billion, why not a trillion, or even 10 trillion. Morons. You might know this came from the socialist state of California. Yup, the effects of smoking cigarettes is the best kept secret in the world.

Hey California, want to end this smoking problem you have, try outlawing it. Wouldn't the feds and the states hate to see that. All that tax money they couldn't get their hands on. That is why it will never be made illegal.

Disclaimer: I am a smoker. I know how bad these things are. I always enjoy it when an obese person starts in on me. They never do it twice. Then there is the heavy drinkers, they don't come back for more either. Point being,there are not many in this world that can cast the stones without having some thrown back

rant off.

R PowellTaylor article // Sierra Madre#8662610/04/02; 15:05:32

Jay Taylor sounded off in a Sept. 30, 2002 article against Doug Casey. Taylor reports that Casey has described the gold conspiracy believers as "low life, stupid conspiracy nuts" who probably live in "low rent, one bedroom flats". Jay then went on to list many of those who have contributed to the GATA effort over the years and opinined that free markets are essential to maintain liberty. Sounds familar and interesting. Perhaps Jay Taylor is a lurker here and has been listening well. It also brought to mind one of my favorite lines from a Neil Young song, The Days of 49,

"Call me a bummer and a gin-sot too,
But what cares I for praise"

Another part of that song.....

"For the days of old,
For the days of gold,
How often times I repine,
For the days of old
When we dug up the gold,
For the days of 49."

Sierra Madre, (86594) thanks for passing along the Mexican silver production reduction question. Please notify us of whatever you hear. Does this pertain to one specific mining company or many? Also is this company or companies primary silver miners or not?
I've read that production numbers, which imply that amount mined, are often misrepresented. Sometimes silver is withheld from the market. This may be due to current prices, tax purposes, temporary shipping problems etc. Sometimes the numbers are simply not reliable. Maybe the company started making payroll and paying other debts with silver! This is all speculation. Please let us know what you can find out? Any links to the original news of a production reduction?
It's that day again!
Happy weekend!

Black BladeFrom The Mail Bag#8662710/04/02; 15:08:04

Another interesting tidbit found its way into my mailbox. As I always say, Get out of debt…. Yada yada yada….

The following may put this in perspective:

Consumer debt rose $500 billion in the last 5 years. The average family has $7,000 in credit card debt alone. Federal Reserve figures show U.S. consumer debt reached 145% of GDP last quarter. Bankruptcies are rising too - there were 1.5 million of them in the last 12 months. "Now is the time to get your house in order," says an article at "Somebody who has a 15% debt to income ratio has a problem," the article explains. By our back-of-the-envelope calculations, the whole nation has a problem.

After a day like today where Wall Street dives on a plethora of bad news items it is a no-brainer that it's in ones best interest to get out of debt and prepare with precious metal accumulation and food storage. Anyway, off to slay the beast and get an hour or so in the gym.

- Black Blade

PizzBoxman#8662810/04/02; 15:13:33

You got to have a couple bad habits or so, heck we might just get real sick sometime and at least we'll have something we can stop and we'll probably get well. Without something to quit, we'd probably just die . . . or so the joke goes (I smoke too).

Re: Seattle weather. The winter snow pack in the Cascade is the key, and it starts snowing in the passes about mid November (skiing by Thanksgiving every once in a while) but over the past ten years or so we've only had a couple good winter packs (last year was one). We may get snow early, but we've been prone to some real warm Pacific December rain storms that melt a good portion, then we get about half as much snow for summer run off, and then we have problems.

I can remember back in the 50's, most lowland lakes would freeze over completely and you could even drive cars on them. They don't even freeze over any more. Definately a warmer climate over past 50 years -

BB - We just had your storm go thru here, wasn't too bad and we needed the water.


Sierra MadreR Powell: more data about the silver shortfall in Mexico#8662910/04/02; 15:18:39

I will certainly investigate, but not today - Friday afternoon; Monday I shall inquire about that strange decline in reported production, and the reasons given - there must be some!


kasperjack Questions We Forgot Ask#8663010/04/02; 15:24:32

With Thanks to: hope in a box

Answer:Manipulation,Deriviatives & Lies
by: hope_in_a_box

How come, after one of the worst weeks the DOW
ever had, the DOW
actually finished the week higher than it started ?

How do they keep gold continually under $330 an
ounce ?

How come the dollar never declines and always
seems strong in spite of the
onset of obviously depressionary conditions ?

How come there is no inflation ?

How come there is huge lay-off annoucements daily
and businesses closings
left and right and the employment numbers are
getting better ?

What is the most damaging potential cause of
financial collapse for the U.S.
economy ?

How could politicians get re-elected in the next
election ?

What will it take for the economy to make it past
next week ?

GuidedDays of 49 and The Times They Are a Changin#8663110/04/02; 15:26:24

Hey R.Powell, like that tune too. I think (been a long time) that tune was originally done by Bob Dylan on an album I used to have. Not greatest hits that had "The Times They Are a Changing" but a lesser known record. You know, back when they were big black plastic platters and it better if you had a diamond stylus needle.

Great and timeless tunes..........but the times are changing it seems and I think rapidly.

For the first one now will later be last.

Take Care all

TopazBonds and Gold#8663210/04/02; 15:26:34

...see previously posted link.

Three benign days in the Bond and Gold pits, usually the moves on strong Dow down/up day's are far more pronounced!!

Next week could be a doosie.
Which direction?...either way it won't matter IF you "possess" GOLD.

AristotleBoxman, thanks a lot!#8663310/04/02; 15:48:31

Thanks for the convenient repost of my "challenge" and thanks especially for your answer.

Let's hope others will continue to share their view on the matter.

As I hinted toward my own answer yesterday, I think the enduring INTEGRITY and QUALITY (thanks Andúril and Sierra Madre) of a person's savings is far more important to their well being than is the viscosity of their drippy dollar lubricant (or yen, pesos, etc.) -- that is to say, the shelf life of their savings is more important than the shelf life of their money. Money should merely pass through their lives without sticking as people pass it along to beneficial use and spending it on meaningful investments and hard asset savings. Which means...

Gold. Get you some. --- Aristotle

With Gold, the monetary authorities can't wreck YOUR fortune as they necessarily inflate THEIR currency to lube the sticking cogs in the economic machinery.

The CoinGuyPizz, All#8663410/04/02; 15:50:09

Couldn't remember the name of the movie you mentioned until today. I think it was "The Great Outdoors". What made me interested in remembering the name was the scamming brother-in-law broker(Boy I could pull a 100 metaphors out of that movie). Preying on the weak, at least he came clean at the end. I'm afraid the American public won't fair as well.

ALL: Interesting comments on FNM's interest rate bets on that article I posted below. I'm wondering what their asset base will look like if we do take the deflation route? Food for thought, but I'm not betting this is the case. At any rate, the markets volatility is getting interesting.

Heading out to fill my Deer tag this weekend. Bowhunting is my favorite hobby.

Smokes, Coffee, and Harp for me,

The CoinGuy

kasperjackCramers Latest And Greatest#8663510/04/02; 15:57:09

Thanks to The Burma Shave Guy : James J. Cramer

Days of Redemption
By James J. Cramer
10/04/2002 02:49 PM EDT

Meltdown after meltdown. That's what it seems like. Why is it happening?
Why are we seeing tremendous swings and big shifts and declines that are
never staunched?

You've come to the right place. What I am seeing on my screen is the total
tip of the iceberg. There are funds out there that are simply bleeding from
the eyeballs,
The veil of delusions must be stripped off before we can begin to correct the damage Alan Greenspan did to America. Kudos to Cramer for telling it like it is this time...

The .02#8663610/04/02; 16:13:00

I hold the physical metal simply because I couldn't sleep at night holding the positions I do without having what I feel is a complete asset without liabilities(frankly, at this juncture in time I feel like I'm trading in paper assets that could blow at anytime, and and it all seems worthless at this point, unless you convert it into the yellow metal). The yellow metal is my anchor(40%) in the stormy seas of speculation were calling a stock market. A heavy anchor, that holds strong against the tidal waves of fiat expansion, slick banking institutions, governments, brokers and all else who want to separate you and your hard earned money.

I also collect the historical(numismatic) metal as a hobby because I like the history of America and it's coinage. The Designs were impressive, the stories behind the coinage even more impressive. I've found it's a good way to learn history and it has helped me to fare well in trying times. (I do believe history repeats, or at least rhymes)

Something a person knows but usually doesn't take a good look at technically is how well gold has performed over the last three years against other assets(NDX,SP,DOW). The charts are a sight to behold, and we haven't even started yet.

I'm always reminded of the article I read from Richard Russell when I think about gold. Paraphrasing, A guy works all week for so many of these printed pieces of paper, that can be printed on a whim and are basically worthless(worth less), it's an injustice to the average man. Thats why I buy Gold.

The CoinGuy

BoxmanAristotle an Pizz#8663710/04/02; 16:14:22

Aristotle, you have no idea how much your response meant to me. Sincere thanks for you presense.

Pizz, exactly, or should I say "right on"?
Climate here in Kentucky is different also. Personally, I prefer milder winters. I don't, however, blame it on man (not insinuating that you have). Mama Nature has constantly undergone climate change, and alway will. When Mt. Pinitubo , in the Phillipines blew a few years ago, it spouted more crud into the atmosphere than all of mankind has in the history of man. Seems like we are all still here.

I fear that I have strayed off of the golden trail enough for one day. Back to gold. Everybody got, or gitten theirs?

bob leppobetting on COMEX#8663810/04/02; 16:21:18

I unlike many posters am betting on COMEX (I am long December 02 gold futures). Part of the reason is I assume that before COMEX defaulted there would first be a dramatic rise in the gold price (during which I am gambling I could sell and extract a major profit). Does anyone know of an exchange default that ocurred before there was a dramatic price move in the market? Another reason I am betting on COMEX gold futures not defaulting is that such a default in the COMEX gold market would be a major embarrassment to the Bush Administration and the Fed. For one thing it would be hard for the Fed/Treasury to defend their bailing out a private company- Long Term Capital- and refusing to bail out a market that the government maintains regulatory oversight of. and not just any market but a market of a commodity- gold- with a continuing monetary role.


TevyeBoxman - BB - food supply#8663910/04/02; 16:23:31

For twenty years now, I have tried to keep a couple months food supply simply by buying ahead a bit, and rotating the new stuff to the back of the pantry / freezer, using the oldest first. That works for most items for short times.

But how do you keep supplies for extended periods of years? And what supplies do you keep?!? Even cans have a shelf life.

Sometimes I rotate my gold supply too. Put the new stuff in the back. Or the front. Or the middle. Without using the old! (yet)! But I don't ever worry about its shelf life!!!

Gold. It's Tradition.

Boxmankasperjack msg#: 86630#8664010/04/02; 16:26:04

kasperjack wrote:

"How come, after one of the worst weeks the DOW
ever had, the DOW
actually finished the week higher than it started ?"

kasperjack, are you sure that you are not looking at yesterdays close? I think the DOW closed the week down 2.2% + or -.

4goldGold Show#8664110/04/02; 16:35:08

Is anybody here planning to attend the gold show this weekend in Calgary, Alberta?
kasperjackSlap Happy PPT Or Decelerated Descent;It Is written In The Charts#8664310/04/02; 16:39:08^DJI&d=c&t=1d&l=on&z=b&q=l^DJI&d=c&t=1d&l=on&z=b&q=l^DJI&d=c&t=5d&l=on&z=b&q=l First Todays the PPT s market intervention was met by a host of sellers. Keep Cramer in mind.
Just like Pak Man they ate up all the bad news and got near to a
zero sum. What's written in the charts?
Boxman that was a repost. Did you not get the gist of what hope in the box was aiming at? hmmmmmmm Don't worry you may have plenty more chances to show me up. rudy kasperjack

kasperjackManaged Descent?#8664410/04/02; 16:45:03^DJI&d=c&t=5d&l=on&z=b&q=l Were interest rate cut rumors and Dow Jones vote for peace in the Mid East used to cover for deluge of terrible economic news this week?
BoxmanTevye msg#: 86639#8664510/04/02; 16:49:38

Tevye wrote:

"Boxman - BB - food supply
For twenty years now, I have tried to keep a couple months food supply simply by buying ahead a bit, and rotating the new stuff to the back of the pantry / freezer, using the oldest first. That works for most items for short times.

But how do you keep supplies for extended periods of years? And what supplies do you keep?!? Even cans have a shelf life."

That could become a very lengthy discussion, and since it would be off topic, my email address is [sorry, not allowed], should you (or anyone else here at the round table) want to further inquire. After putting up the equivilant of 30,000 pounds of food, I feel that I have an idea or two. No doubt, Black Blade has too.

I liked that gold rotation statement.

R PowellBob Leppo#8664610/04/02; 16:51:10

I'm not aware of any commodity market default but the market brokers hold the power of determining what margins they think are appropriate so margin requirements can be changed at any time. Also, during silver's spike up in early 1980 the Comex controlers finally issued a "liguidation only" order which curtailed new long positions except those bought from the sale of an existing long. However, by that time, the only sellers available for new longs to buy from were the producers and bullion bankers who weren't selling and hadn't been for some time- hence the high POS.
Concerning margins, if the price gets very volatile, more margin is necessary to insure against default. With both gold and silver, imho, the day may come when the market is forced to default on physical metal delivery and settle accounts with paper money. The Comex has a physical delivery cutoff in silver at 7.5 million ounces per month which they have the option of using if they have to restrict delivery. Many don't believe there is sufficient silver to supply another large (Buffett like) purchase but the government, the Greenman and the Fed are working hard to make sure we can take our profits in fiat. Paul Sarnoff wrote a good account of the 1979-1980 silver market called "Silver Bulls". It's hard to find but tells a great tale.
Happy weekend

kasperjackWas PPT Slap Happy Today?#8664710/04/02; 16:52:15^DJI&d=c&t=1d&l=on&z=b&q=l^DJI&d=c&t=1d&l=on&z=b&q=l the
sudden surge in the Dow average was
beaten back by relentless selling. If the
PPT cannot even prop up the market
anymore then... Time will tell. Gotta go follow up on massive jpm layoffs....

BlackjackBrazil election and World Banking#8664810/04/02; 16:52:48

NEW YORK (CBS.MW) -- Lula may become Brazil's next one-name worldwide wonder if a fragile Wall Street reacts violently to a first-round knockout by the leftist in Brazil's presidential election Sunday.

While a first-round victory by Luiz Inacio Lula Da Silva (or Lula as he's popularly known) is too close to call, political analysts and strategists say it's all but certain he will lead the world's ninth-largest economy, given his domination of the opinion polls.

"In terms of the initial reaction, there will be a minor negative effect (from a Lula victory)," said John Maguire, senior managing director at Medley Global Advisers. Maguire doesn't think there will be a lasting impact on Wall Street.

According to the most recent Datafolha voter-opinion poll, Lula is ahead of his chief rival, ruling-party candidate Jose Serra, by 28 percentage points -- a figure that analysts say will come down in a two-way race in the second round, but won't be erased completely.

"At this point, it's extremely hard to tell if Lula is going to win in the first round or if a runoff is going to be necessary, but, in spite of that, it seems very likely that Lula will, one way or the other, be the winner of the election," said Ricardo Amorim, the head of Latin American research at IdeaGlobal.
Morgan Stanley's Fine thinks the real could hit 4 to the dollar if Lula wins -- a slide that others say could trigger a default of its debt, given that much of it is denominated in dollars.

Morgan Harting, sovereign analyst at Fitch Ratings, said that with Brazil's massive debt load and precarious economic situation, the country has little room to maneuver if it hopes to avoid default.

"Our best case scenario is that Brazil will not default on its debt, but we're signaling that there is a significant possibility that it will default. There is a limited margin of maneuver to default," he said, adding that the rating agency looks at the country's interest rates and currency to determine whether it should be downgraded again.

"If we saw further movement on these variables, then that could have an impact on debt sustainability."

In late June, Fitch cut its sovereign rating for Brazil to speculative B-plus from BB-minus, and put the region's largest economy on negative watch, citing the debt burden.

Watch the banks

On Friday, financial stocks in Europe and Asia tumbled on concern that Brazil might default after Sunday's presidential election. Read full story.

U.S. banks, most notably Citibank and FleetBoston Financial, would come under tremendous pressure if their investments in Brazil were to go sour. The banks' exposure is estimated at over $25 billion in Brazil.

According to a note issued by US Bancorp back in August, lenders were led by Citigroup's (C: news, chart, profile) $11.4 billion and FleetBoston Financial's (FBF: news, chart, profile) $10.3 billion. Other banks with significant exposure included J.P. Morgan Chase with $2.1 billion and Bank of America (BAC: news, chart, profile) at just under $2 billion.

Of the U.S. banks, FleetBoston has been most affected by the turmoil in Latin America, posting a massive charge following Argentina's meltdown earlier this year and setting aside hundreds of millions of dollars more in reserves in case Brazil goes, as well.
Citi and JPM have a lot riding on Sunday. By Monday what
happened in Brazil will bring more focus to global debt
defaults and financial stocks.

BlackjackChartists say Fall Street to continue#8664910/04/02; 16:59:31

NEW YORK, Oct 4 (Reuters) - U.S. stocks have just ended the quarter with their biggest losses since the 1987 stock market crash but the worst is yet to come, say technical analysts who chart stock movements, trading volume and market sentiment.

Even though stocks continue to plumb multi-year lows, the market hasn't seen the kind of "wholesale" dumping of stocks they say it needed to wash out the remaining excesses from the late 1990s bubble.

"Investors should stay on the sideline," said Mark Arbeter, Standard & Poor's chief technical analyst. "I wouldn't recommend people buy any stocks at this time."

The broad S&P 500 index (CBOE:^SPX - News), which has tumbled more than 17 percent in the third quarter that closed on Monday, could fall a further 20 percent or more to 600-680 level in the next couple of months, said Arbeter.
More bad news coming from financial sector. Debt debt and
more debt. Mizuho for example.

BlackjackJPM cuts jobs by 20%#8665010/04/02; 17:06:08

10/04 18:22
J.P. Morgan to Cut About 20% of Bankers, People Say (Update1)

By Michael Nol

New York, Oct. 4 (Bloomberg) -- J.P. Morgan Chase & Co., the second-biggest U.S. bank, will fire about 4,000 of its 20,000 investment bankers this month after trading revenue plummeted and loan losses surged, people familiar with the situation said.

Chief Executive William Harrison will cut jobs across the investment bank including in divisions handling mergers and acquisitions and equity and debt underwriting, the people said.

Harrison said last month he would take steps to cut costs in a bid to stem a 55 percent drop in the bank's share price this year that has trimmed $39 billion from J.P. Morgan's market value. The bank said loan write-offs quadrupled in the third-quarter from the previous three months to $1.4 billion.

BlackjackCEO's see no recovery for a couple years#8665110/04/02; 17:16:27

White Sulphur Springs, West Virginia, Oct. 4 (Bloomberg) -- America's top corporate executives, cloistered at a West Virginia resort, said they're concerned the U.S. economy's recovery has stalled and investors may have to wait more than a year for stronger growth.

``The second half of some year, we will get a recovery,'' said John Trani, chief executive officer of Stanley Works, in an interview. ``But it will be a couple more years.''

The number of executives who say business conditions are better now than they were six months ago has plunged to 29 percent from 62 percent last quarter, according to a Conference Board survey released yesterday.

Slack corporate spending has hampered sales of everything from Stanley tools to Hewlett-Packard Co. computers to seats on Delta Air Lines. Some analysts who once forecast a pickup by the second half of 2001 have now pushed that estimate back to the second half of 2003, and many CEOs say they can't be sure it will happen even then.
No recovery here. You would think PMs would do better with
banks around the world in such bad shape. The WGC should be
more active in promoting Gold. We need PR for our sector.

kasperjackSpeaking Of South America: Here Is A Travel Advisory#8665210/04/02; 17:18:18

thanks to oneandbe48

On the phone today with a friend>
by: oneandbe48 (61/M/S Alabama)

who is engaged to a Colombian living in Texas. She tells him the terrorists
in Bogata( they are called drug gangs) have mobile computers. They will
stop you at a road block, punch your personal info into the computer and get
info on family, bank accounts etc. If they can determine it is worth their
while, you are held until a ransom is paid. We never read about that !

AristotleThe CoinGuy, Tevye#8665310/04/02; 17:37:03

CoinGuy, thanks for your input. I'll share something with you since you were so candid about the human side of your Gold holdings. As time and experience continue to draw onward I've found myself suffering (well, maybe that's a bit strong) a decreasing attraction to Gold bullion.

Beyond maintaining token representations (meaning a couple dozen or so of each) of Krugerrands, Maple Leafs, Philharmonics and the like, I can't clearly recall the last time I've added to my bullion pile.

What's captured my interest is the older coins that were designed for circulation as real world currency -- sovereigns, Gold francs, Gold marks, and the like. The appeal for me with these coins is that I don't have to immerse myself into the numismatic lore (which you obviously enjoy so much -- good for you!!!) to figure out if I getting a good deal because these coins that I'm talking about sell for petty premiums above plain ol' bullion. In my mind that's a bargain for the extra benefits of security and enjoyment that I can get out of these coins.

At the risk of sounding quaint or sentimental, bullion is boring; it just lies there, while the older coins call to me to visit them, to stack them and group them into different geopolitical piles and recall the rich history of our world's past 150 years. Much has changed but the value of the Gold endures. I say, why settle for a sterile existence when you can emerse yourself in culture!!

King's Gold!!! Get you some. --- Aristotle

PS. Tevye, thanks for echoing the important aspect of "shelf-life" for our savings.

PizzSooner or later they'll get it right#8665410/04/02; 17:37:39

Just heard my first analyst say as soon as we get thru the next week or so, that the markets will start discounting a second half 2003 recovery.

Now, to any that fall into that camp, I'll ask as to just what section of the PRODUCTIVE (as compared to government) economy is going to lead us out, and more specifically HOW????

Course that might be just a little too tough to comprehend - kind of like Santa Calus.


VanRipSector#8665510/4/02; 17:58:10

Thanks so much for such a detailed answer to my question about the effect on the gold price of a COMEX default. Very generous. Just great. It's amazing what one can learn here.
AristotleThoughts on stacking old "King's Gold"#8665610/4/02; 17:58:50

Lest I earn the derision of any of the cold calculating investment community out there, let me put this into perspective.

When you work hard and make intelligent decisions, with a little grace perhaps you will make a small fortune for yourself during your days on earth. There are two primary benefits that should avail themselves to you out of this situation -- 1) security against future discomfort of poverty, and 2) pure enjoyment of life.

I know oilmen and ranchers in Texas and Montana are always happy to have you climb into their pickup truck for a bumpy cross-country ride from fenceline to fenceline to simply drink in the majesty of their land, their wealth.

Well, where acres and acres don't fit into your lifestyle, the occasional stacking and recounting of King's Gold is the same thing. It adds to the quality of your daily life by reinforcing 1) your sense of personal security, and 2) your pure enjoyment of your accomplishments. A stack of Gold is NOT an abstraction. You earned it, so bask in its glow and tell yourself "Job well done!" Then get out there in the real world and do something else to earn some bucks, upgrade your patio furniture, and add further to the pile!

King's Gold. Get you some. --- Aristotle

makcumkaone more lurker emerges#8665710/4/02; 18:24:31

Hello, all

I have learned a great deal from this forum, although my ignorance in the matter of gold ownership remains. After worrying about the uncertainties of the future in the beginning of my life (i'm in my mid-20), the forum definitely helped me in understanding one thing - protecting the little bit I was able to save up by investing into gold. I believe this is the only option left for me personally. Although, 2 questions:

1. Is there anything else that can be done to protect oneself?

2. More I think about it, more I am starting to wonder, how come every time I go to the bank or ATM, majority of the notes I get are NEW. Even the "big faces" been around for a few years. Reminds me of times of my native Russia when the government kept re-issuing paper money to keep up with the latest political situation, exchange rate or sentiment (like when theold tzar double-headed eagle replaced the version of "White House" on the notes). Seems like the people are not paying attention to the presses working day and night, and changing out the look of the paper money hides it even more.

Gandalf the WhiteWELCOME Sir Makcumka !! #8665810/4/02; 18:48:05

makcumka (10/4/02; 18:24:31MT - msg#: 86657)
one more lurker emerges
In PARTIAL answer to your first question -- I suggest that you watch for Black Blades suggestions of what every Goldheart should do --- Get out of DEBT ! AND STAY out of DEBT !! Have a supply of CASH available (ON-HAND and not in the Bank ) Plus a reserve of food and supplies !!!
Please look forward to obtaining additional responses also.
ONE LURKER at a time is the NEW Hobbits motto !

BlackjackPuplava on PMs#8665910/4/02; 18:50:28

I have recently received numerous e-mails regarding silver's role in a deflationary environment such as we experienced during the Great Depression. We need a few facts first. During the Great Depression, there was surplus of silver in the country. Congress actually passed a law requiring the Treasury to buy silver. This was a period when the government's great stockpiles were accumulated. After its nadir in 1933, silver actually performed much better than gold. Gold prices were capped at $35 an ounce. Charts and other fundamental aspects will be covered in next week's Wrap Up as supply dynamics begin to unfold in the months ahead. Simply put, silver is undervalued in a major way. Prices have been kept down through short selling since there are no large deposits of silver that can be loaned out to bullion banks from the vaults of central bankers. The only way to keep silver prices down is through the use of derivatives or paper contracts. Large supplies of the metal simply don't exist. Mainly consuming above-ground stockpiles accumulated over decades has made up silver deficits. Those stockpiles will be running short over the next 18 months. The Treasury will have to go into the market to buy the metal for its silver eagle program. The Treasury purchase of 10 million may not sound like much until you add it to a 100 million plus existing supply deficit. One can only speculate as to how high it will go when gold and the metals take off as confidence in paper evaporates with each new oncoming financial crisis -- not to mention potential geopolitical rogue waves.

The smart money already owns silver. Buffett bought his stake in 1997. He took delivery and then shipped it to safe keeping overseas. Others such as Soros, Gates, and Tish have bought because they apparently recognize silver's gross undervaluation. Gates already owns 11.8 percent of Pan American Silver, a position he has held and has added to over time. I also know of five other fund managers who own significant positions in some of the companies listed above. In fairness and part of full disclosure I also own some of these companies in my own account or for my clients.
The one bright spot this week was gold. In fact Investors Business Daily did a story about some of this year's most successful fund managers. The leading managers have been accumulating gold. The average gold fund is up 45 percent for the year compared to almost equal losses for the NASDAQ and the S&P 500. Precious metals have held the center stage since the bear market began in March of 2000. The top funds in performance this year are either short funds or gold and precious metals funds. This is a trend that has continued from last year. Wall Street doesn't like to talk about the metals because they present competition for the markets. However, the smart fund managers have been buying and are outperforming the herd. Managers have been accumulating Gold Fields, Gold Corp, Glamis, Harmony, Meridian, and Agnico-Eagle. The common thread of all of these companies is that they are unhedged gold producers. They have consistently out-performed hedged producers. The difference in performance is shown in the producers such as Barrick and Placer Dome. Barrick is losing big money in its hedges as the price of gold rises.

TevyeBoxman 86645 - food Ari - Coins#8666010/4/02; 19:26:33

Boxman, Thanks for the reply. Upon returning from dinner I found your message reading in part:
"That could become a very lengthy discussion, and since it would be off topic, my email address is [sorry, not allowed], " You are correct about off topic.
Perhaps the Castle guardians will put us in touch.

Ari, I too prefer the older 'Kings coins' or even the older, common date US issues. There has been quite an increase in numismatic gold at the recent major auctions. And getting good prices, too. But, I wonder: why now? The gold bull is just getting underway.
Perhaps CoinGuy has an idea.

makcumkacash on hand#8666110/4/02; 19:42:31

Sir Gandalf the White,

Thank you for the kind words of welcome.

I am struggling with the suggestion of "cash on hand". If the dollar is deflated - everything is good and well. If the dollar is inflated - cash on hand will lose its value in a very short period of time. And if my understanding is correct, the volume of paper money being printed warrants the inflation outcome. Given the rate the pay scales in my line of business have increased in last 5 years, deflation seems like a long shot. Makes cash seem like a rather unstable asset, given the fact that I have experienced the purchasing power of a currency decline 75% in a matter of one week, if things go "right".

steadyGandalfs welcomes#8666210/4/02; 19:43:30

seems like gandalf is sure busy with the welcomes lately anyone else notice that? I think its a sign of the times and good for gold! the word is out come to the forum and learn. I tell anyone who cares to listen to come here.
Gandalf the WhiteSir Makcumka's "cash on hand" question !#8666310/4/02; 20:05:59

I know EXACTLY what you mean !
In '97. I saw the Thai Baht drop 50% in one week also !
AND my operational investments go "TI" (as Black Blade calls it) ===
The AMOUNT of "cash on hand", as I understand it, is only for necessary purchases of REQUIRED items, IF something requires the BANKS to close and funds are not available. Perhaps we can get Black Blade to further assist us on this ? YES, BB ?
I and the Hobbits have most our fortunes in YELLOW thingies that stack well and tell fantastic stories when a "tell us where and why you traveled" spell is cast upon them !
I wish all could "hear the stories" from the ARAMCO "Pound" and "Four Pound" pieces in my showcase !!! (AND also have heard the stories from the FAKE Pound pieces that were returned to their "pushers".)

HoratioBear Stearns#8666410/4/02; 20:11:22

So his finger slipped ? Ha Ha...its probably the most profitable thing he's done in 6 months.
It smells like the pressure is building on the longs,just like it does to the shorts in a bull market.They are starting to "break ranks",we shall see some more finger slips before the ROUT.....

HoratioBear Stearns SOB#8666510/4/02; 20:20:19

Maybe he just didn't hear his instructions right ,like this little boy!!!

A little boy was doing his math homework. He said to himself, "Two plus five, that son of a bitch is seven. Three plus six, that son of a bitch is nine...."
His mother heard what he was saying and gasped, "What are you doing?"
The little boy answered, "I'm doing my math homework, Mom."
"And this is how your teacher taught you to do it?" the mother asked.
"Yes," he answered.
Infuriated, the mother asked the teacher the next day, "What are you teaching my son in math?"
The teacher replied, "Right now, we are learning addition."
The mother asked, "And are you teaching them to say two plus two,that son of a bitch is four?"
After the teacher stopped laughing, she answered, "What I taught them was, two plus two, THE SUM OF WHICH, is four."

BlackjackTop in Bond Market now in? Puplava#8666610/4/02; 21:08:15

As you know from my various postings, I have been focused in on the US dollar and the US Treasury Bond Market, looking for any sign that non-US holders of US Treasury Securities were becoming concerned over their profits being eroded by lower dollar levels.

Well, today was the first sign of that possibility as the stock market declined significantly in the first five hours of trading. Surprisingly, when the market was off considerably and showing no sign of recovery, the long-term US Treasury Bond Market was also in a decline. This is the first break in the multi-year profile of this market, which has been rising in tandem with every significant stock market sell-off. Today, US Treasury bonds, rather than rising, were falling as the stock market marched towards a Dow at minus 300.

What makes me focus on this phenomena was that there are rumors that the Exchange Stabilization Fund entered into the US dollar Forex cash markets to support the dollar as the Dow went minus 200. I am therefore of the mind that this reaction from Washington was a reaction to the beginning of a liquidation of US Treasury Bonds by non-US holders. We shall see?

However, all efforts to stop a dollar decline here, except in the shortest-term, are a waste of time & money because of the concomitant events of US Budget Deficit - US Trade Deficit - US Current Account Deficit and the dollar reaction. The bonds did rally on the rally in the US dollar as did the stock market.

Regardless, today, Friday, October 4th, should be noted as the first time the bond market fell out of its inverse relationship with the stock market since March of 2000. That would be right on time, if I am to be correct in my assumption that the 5th Element necessary for the fundamental conclusion that we are in a long-term gold bull market was to fall into the equation, which is a top in the bond market before the end of November 2002. Of course, I put out an exploratory short again on the 30-year bond with a 32/32 stop loss.

TrapperSirs: Boxman & Tevye#8666710/4/02; 21:30:53

RE food storage

Food storage is really easy there are many things that will store for decades and be good to eat, but the question is will you eat it. It is a fact that very old and very young will die of starvation if they don't like their food. I have lived small for years and found that it is nessary to take care of yourself. I suggest you buy books on home canning of foodstuffs. I won't every freeze wild (or tame for the matter) again as I can all of it. You never worry about the power going out and you have to eat a years meat supply it 3 days. I can all my own salmon and smoke all the ruff fish, smoke my deer hams etc. Store bought canned food will last until the integrity of the can is gone. Even if it is a few years old it will be fine to eat it just will lose food value.
The Morman church is the worlds leading authority on food storage and the sell several books plus you can get plenty of info like mother earth news etc. Food gold silver and warm spot to live and the means to protect it will make one sleep well. Live small my friends.

Sierra MadreLou Dobbs the political commentator....#8666810/4/02; 21:35:08

I got CNNfn on my TV for Lou Dobb's Moneyline just a while ago, and turned him off after twenty minutes of Colin Powell with Blix and talk talk talk about a UN Resolution that will say what the US wants it to say, and then more stuff on six guys held as "terrorists" who have been arrested because it is presumed they are going to do something wicked.

This reminded me of the post earlier that now "seers" are divining intentions and taking action before the crimes are committed. New type of justice.

And what about Money on Moneyline? Nothing after twenty minutes. Hmmmmm. Prefer not to talk about today's atrocious results, Lou? Wouldn't you know! What about JP Morgan today, Lou? Maybe he did get around, at last, to Money, which is what he is supposed to talk about. Like us, about gold. "ON TOPIC, LOU!!" You might tell us about when you left Moneyline to start up your very own, and then had to come back, tail between the legs, because you lost a bundle.

I think I need another cigar.

Pleasant weekend, goldmeisters!


Black BladeFood Storage and Cash Stash#8666910/4/02; 21:51:04

Food Storage

Actually I keep quite a bit of food that will keep almost indefinitely. Pasta and grains such as rice, corn, beans and wheat will keep well in sealed plastic buckets. I also have canned and bottled goods that I get on sale usually in case lots. I rotate these items as I use them. Obviously get items that you will actually use. Tonight I am cooking up fried rice with some haba--eros, garlic, fresh cilantro and green onion cooked with corn oil that will go along with some Hungarian partridge from the freezer. The only items that I picked up that were not from my storage are the cilantro and onion. I also got a few buffalo steaks, roasts and sausage at a local ranch to add to my freezer supply. The whole point is to use items from your storage and occasionally replace them when you find them on sale or at discount in bulk. I picked up a few 25 lb bags of rice for about $5 a bag at Wal-Mart a couple of days ago. In the past I even brewed my own beer. Come to think of it, one could bury some PMs in a bucket of grain and no one would be the wiser. Hmmm…

Cash Stash

Think Argentina. When the banks closed in Argentina, as in other places throughout history, those who had cash on hand were able to the more immediate bills and other obligations. If you are out of debt, then you will obviously need a lot less cash. During the Great Depression when the banks closed many people simply lost their savings – poof! Others watched their savings become devalued after the President decreed gold to be illegal and after confiscation promptly devalued the dollar. Still, a bit of cash on hand can't hurt. More people have been harmed by not being prepared than those who did. The reason I say have some cash on hand is to meet a few months expenses should the worst happen.

I have heard it all about "hoarding" food, gold, cash, etc. Those cries are usually by those who haven't taken the time to insure themselves and their families against potential disasters whether it is an economic collapse, extended unemployment, extended illness, etc. Some just prefer to take the ostrich approach to living where they live on hope that everything will work out somehow. I have no major concerns and I have been unemployed since January. I have been using the time to hunt, fish, exercise, and enjoy life. I am still well stocked and could go for another few years. Yet I do pity those who are not in a position to get by should they find themselves suddenly without an income and undersupplied. That's why I always say: get out of debt, stash enough cash for several months expenses, accumulate Gold and Silver portfolio insurance, and start a storage program of nonperishable food and basic necessities.

- Black Blade

Nibelungtelevision#8667010/4/02; 21:56:37

My wife and I "pulled the plug" on television a when we moved a couple of years ago. That is we gave away our big tv to an elderly couple in our old neighborhood, and never got cable at the new place. With cable you pay all that money and it's practically wall to wall advertisements. And when it's not ads, the programming (perfect word for it) is alternately dull or just downright surrealistic.

I will say we kept our old small 25 year old japanese color tv that still works fine, and occasionally we watch a nature show or the "Nightly Business Report(for a laugh)" or the Charlie Rose interview show on PBS.

If I want to find out what sort of foolishness the major media outlets are up to, I just take a look at one of the major outlets on the web.

Black BladeLong Lockout Would Hit Business Hard#8667110/4/02; 22:45:52{B16F5248-3B2B-4446-BE45-137B2B765DB4}&siteid=mktw


As a federal mediator sat down with both sides to try and put dockworkers back at their jobs, companies were wondering how long they could hold out before the ports closure will begin to hurt. Many companies started stockpiling goods several months ago. They worried that a job action would interrupt the flow of goods into the U.S. that allows them to build computers, stock retailers' shelves and bring car parts to domestic factories. But it won't last forever. Calls are increasing for President Bush to step in under the Taft-Hartley Act and order the International Longshoremen and Warehousemen Union's members back to the waterfront. For the U.S., the tab is now $1 billion a day. That could increase to more than $2.4 billion a day as time goes on and the effects of a work halt pile up. "It's a huge consequence to this quarter's GDP," said Dave Littman, chief economist at Comerica Bank in Detroit. Littman said if there is 3 percent-plus GDP growth, that could be reduced to zero. "This is not a healthy enough economy to weather the storm," he said. "If it goes on anymore, without some White House intervention, the economy is in jeopardy."

Black Blade: The effects of an extended lockout would be hard to disguise if it nails the GDP into negative territory enough to "officially" send the economy into recession. Still ships are backing up in west coast harbors jockeying for position to wait this mess out. Of course a lot of perishable items are likely to be ruined even if the lockout is resolved this weekend. Any longer and the ripple effects from unemployment to transportation to US exports to lost manufacturing will amplify the initial estimates of over $1 billion/day to much more. "Interesting Times"

goldquestPitt Met With Goldman Sachs Chairman#8667210/4/02; 22:54:06

Nothing like having the sheep dog, in charge of the flock, telling the wolves how to avoid getting caught!
Pitt should be prosecuted for his blatant corruption and dereliction of duty!

Gandalf the WhiteThanks BB for the detailed thoughts on "PLAN AHEAD" !#8667310/4/02; 23:16:32

kasperjackSPLAT#8667410/4/02; 23:26:37 Dow Jones Business News Professor: Japan Policy Changes To 'Hard
Landing' - Kyodo
Saturday October 5, 12:07 am ET

NEW YORK -(Dow Jones)- The government is set to change its economic
to a "hard-landing track," Masaaki Honma, a private-sector member of the
Council on Economic and Fiscal Policy, said Friday, Kyodo news service

"The policy will change from a soft-landing track to a hard-landing track,"
professor at the Faculty of Economics of Osaka University, said in a lecture.

"It will definitely contribute to structural reform of the Japanese economy in
medium to long term," he said.

Kyodo reported Honma also said he is in favor of injecting public funds into
banks again to boost their depleted capitals and accelerate the disposal of
loans on condition it is aimed at promoting structural reform.
I myself doubt whether they can solve their problems without dealing with keiritsu. And that would bring the entire system down.

TopazBlackjack re: Puplava #8667510/5/02; 00:38:59

It was gratifying reading your Puplava post on the unfolding Bond situation - nice to be on the same page as a "professional" once in a while.
This current action could well mark the beginning of the "end-of-days" scenario as subscribed to by myself and others as short/long spreads begin an erratic guyration - culminating in market lockup.
Next weeks action is critical.
If the Long Bond moves to 4.5% (yield) Mr Greenspan will be compelled to cut (imo) ....let's watch!

Blackjack"Hard Landing" for Japanese Banks#8667610/5/02; 01:09:15

Japan's Minister for Financial Services, Heizo Takenaka, said Thursday his task force will help the biggest lenders raise profits. A draft of those measures, which may include the use of public money to help them accelerate bad-loan disposals, may come as early as this month, he said. No other details were given.

``I agree with the hard-landing scenario even if that results in a short-term market crash,'' said Dai Nishiyama, who helps manage about $22 billion of Japanese stocks at SG Yamaichi Asset Management Co. ``In the long run, that's going to get all the cancer out of Japan.''

Japanese banks held 52.4 trillion yen ($425 billion) of non- performing loans as of March 31, according to government data.

Meanwhile, Prime Minister Junichiro Koizumi may announce in the coming week a government economic package aimed at stemming price declines and restoring the financial system's health, a Nihon Keizai newspaper report said on Friday.
Wave of bankruptcies coming.

The CoinGuyECRI's Future Inflation Guage#8667710/5/02; 02:04:13

Look's like the FIG took a little jump this month. Ouch.

The CoinGuy

TopazGolden "Super"#8667810/5/02; 04:51:18

Just opened my snailmail Superannuation statement (employer funded) and was not really surprised to see a loss of 0.4% recorded for my particular sub-fund (f/y ending July).
THEN came the charges and the net loss was substantially more.
Accompanying the statement was a "glossy" outlining the performance of OTHER subsidiary funds under their umbrella and lo and behold, my fund outperformed.
The immediate reaction was, "phew!...How lucky am I, ONLY to have lost 0.4%" ...a natural reaction YES?

These people ARE clever!

I'm seriously considering resigning my current position JUST to roll over this deminishing asset into my own Fund to acquire Metal....alas time may not permit it.

SpartacusBrazil's Creditors Hope It's Not Lula#8667910/05/02; 06:54:50

Brazil's Creditors Hope It's Not Lula
By David DeRosa

New Canaan, Connecticut, Oct. 4 (Bloomberg)-- Brazil's bondholders are dreading Sunday's presidential election as though it were a date with the hangman.

The opposition party's candidate Luiz Inacio Lula da Silva is favored to win the presidency. Some investors associate a Lula presidency with the financial collapse of Brazil.

One simple indication that markets are stressed is Brazil's benchmark April 2014 ``C'' bond. It closed yesterday at 2,127 basis points over comparable U.S. Treasury bonds yesterday.

This bond, with its astronomic yield to maturity of more than 24 percent, may be a better indicator of Brazil's financial survivability than Lula's vote total on Sunday. That is because if Brazil doesn't find a way to drastically reduce the cost of rolling over its sovereign debt then it will go bust regardless of who is president.--

Golden BearTopaz (msg#: 86678)#8668010/05/02; 08:08:09


Hi Topaz,

yeah, I got hit 5% up to July, and shifted all my super money over to the cash option. It's not much but if it can be preserved, I'm happy with that. If it was a substantial amount, I would not hesitate to move it over to a personal fund in PM's. Earlier this year, a fair percentage of my savings account went into PM's.

Can't you personally open a personal fund and move your money from the employer's fund to yours, without needing to resign your position? Unless you want to get out of the job anyway... :)


BoxmanAdmin: Permission to distribute my email address#8668110/05/02; 08:21:21

I guess it pays to go back an reread the rules. If it is an accepted practice, I give my permission to pass along my email address to anyone that has an interest in food preperation. I know that this is off topic, however, I feel strongly that having some food stock piled is important.

Again, my apologies.

Golden BearHugh Hendry expects JPM bankruptcy#8668210/05/02; 09:01:27

From the JPM Yahoo boards...

Hugh Hendry expects JPM bankruptcy
by: dmue99
10/04/02 05:16 pm
Msg: 42611 of 42756

Today on CNBC Europe's show "Investor's clinic": Hugh Hendry from Odey Asset Management expects a final market collapse with a bankruptcy of a big financial institution. His number one candidate is: JPM.
GB:Blunt and spot on... Hugh a lurker here?

CometoseYESTERDAY'S POSTS#8668310/05/02; 09:30:25

YESTERDAY'S POSTS paint a pretty clear picture of the reality of where things are going and that it is going to be very ugly.

Perception is built on information (Intelligence). Prechter in his book, Conquer the Crash , makes several references to perception as a critical link to being able to see these storms coming. To be able to avoid the ravages of depression , he says ," you need to be able to foresee depression. THIS IS ONE OF THE INSTANCES WHERE FOLLOWING THE ADMONITION OF JESUS "SEEK AND YE SHALL FIND" IS VITAL AND INEXTRICABLY LINKED TO ITS EFFECT OF KNOWING WHAT IS GOING ON.

It's good for us all to have the forum to keep us on the Trail.

It is quite important to realize we are in the middle of information that can enable us to act decisively to secure our desired outcomes.

Yesterday's early posts made mention of Bill Gross's doubling down in Brazilian Bond market. THis was indicated as a grave risk..and also a breach of his Fiduciary duty to his investors. Stats were given as to the chances of default if Lula the frontrunner is elected Sunday . THey were indicated in a high range and WERE probably understated and Lula is ahead in the polls by 28 points. Last night we saw the many posts relating to JPM's deathwatch .

SOmeone on CNBC yesterday stated that fair valuation for the DOw is 5000-6000 based on his analysis.

In addition to the creidit problems that will come about while JPM falls and its ripples{interwoven relationships State side (which were indicated by A/FOA's writings)} , there are who knows how much credit derivitives securities that Mutual fund institutions bought for their investors. THe fire is just beginning ....and Canada has issued is prospects for interest rates for the coming year and its implications(that looks like a leak) not unsimilar to the the accident at Bear Stearns.
What a week!!!

I think these incidents may be a sign ...that ....


THis information is a gift ...a golden gift.
THen there were posts related to the implications on the comex of the fall of JPM.

Thanks to all the posters here ...for the wealth of information you bring us daily.. THis is real ...REal information, and real light(financial and economic) for direction. SOMEONE once said the purpose of ALL education is action. THIS MIGHT BE THE TIME TO TAKE SOME ACTION as things seem to be unraveling pretty fast.

Based on the latest news and traders having a weekend to digest the info....Monday could be a BLOOD BATH.

turkey hunterTrail archive#8668410/05/02; 10:52:53

It seems like FOA tends to think these big derivative players (JPM)?? will come out on top according to the end of this discussion.... "So how will these big derivative players make out on their paper gold loans and paper gold shorts?"...."I think they will make a fortune because they understood Another better than the Western Gold bugs could!"

With all the discussion about JPM going down maybe someone could explain this since this will be a slow day at the forum. Thanks.

FOA (06/12/00; 19:48:25MT - msg#26)
Put your cards on the table!

Today, paper gold derivatives are for selling because they will eventually be politically defaulted once their discount to physical drives their value next to nothing.

So who is in danger of being hurt as this unfolds?

That's right, the Western paper gold long! I'm not talking about just the US market! This is about the entire world gold market as we know it today. The real play will be for the ones that get out in front of the move by owning physical.

This stampede out of "paper physical" by the "big boys" will first discount that medium as all the selling comes to play. Then the real buying of physical will ensue. It seems every Gold bug sees only half the trade and has great faith that contract law will favor a short squeeze. Yet, none of them see where it's the long that will be dumping and forcing the discount!

Yes, the Washington Agreement gunned the paper price and was the political signal that gold was "on the road" to super high prices. But, when we said gold we were talking about the same "physical gold" we always point to. The process that agreement started was really marking the death of our current paper gold market place, not it's new use beginnings!

Whether the paper market was about to default and burn then (as we thought it could / was) or next year, the point of all this is that it's destruction is politically written in stone!

Still, not one Western Gold bug in a thousand fully grasps the impact of this. Most of them frantically search for a ray of light that shows how our "price discovery" paper market will advance in value.

All the while major players unload on investors all the derivative gold we are willing to bid for. At the same time world traders are buying all the physical gold that comes their way.

Eventually, "Physical Gold Advocates" will own a real wealth asset that's fairly marked to market in a "free gold" Euro Zone marketplace. The same marketplace value that will back the new Euro economy by pricing "free gold" in the many thousands. A new world class currency backing a new world class currency!

So how will these big derivative players make out on their paper gold loans and paper gold shorts?

I think they will make a fortune because they understood Another better than the Western Gold bugs could!

Thank you for camping.

FOA/ your Trail Guide

goldquestPrepare For Black Wednesday Oct 16#8668510/05/02; 11:06:11

Gloom and Doom!
GoldnSilver2002OF Banks and paper gold#8668610/05/02; 11:29:58

Yes i have too grappled with the question of how the big boys climb out of their position and how we are seeing more and more paper contracts becoming nothing more than rough toilet paper.I am in europe,one of my banks with involvement in this whole enron mess was downgraded to aa plus.Lately,they seem stressed and my accounts have many little extra charges all of a sudden.I will be closing my paper gold position,taking fiat and buying physical now.Why?because what good is paper gold if your bank cannot deliver?I believe now there will be two gold markets soon.Real gold will seperate from a controlled paper gold.These paper gold positions will be slowly unwound with fiat.The selling from one arena controlling its own upswing and yet driving up physical,as the JPM/ citibank etc shenanigans become public.I do not believe we wake up one day and all banks will be closed.Why?Well if the banks are closed how do i pay my taxes or rent even or mortgage ,car payments etc.I guess if my bank defaults i just keep em free and clear?Forget about credit card bills all the banks will be closed.I just dont see it.I do see a rash of say 25 percent of the banks closing or going into default,which will seem catosrophic and send off a wave of fear such that there will be a run on banks.The governments will be forced to print money(hyper-inflation) to cover the banks and (physical)gold will flourish as something that wont just default some day. Some of these banks(the wise) hold lots of gold'so as it rises their loses will be mitigated.At some point gold will rise faster than the markets can fall,making up for lost time(misinformation en mass).It seems to me the markets stayed open after 1929 to 1932.If every bank and every market in the world closes,then nothing will matter as people en mass panic.Crime will soar,food will be scarce and plague(from malnutrition and lack of medical supplies) would be rampant.

Yes i will continue to accumulate physical gold and silver,but if these markets continue these gold and silver stocks will be a good play as they are the only thing left.And you know how the market loves a winner,and how they love to gamble on "hot" sector.If the markets collapse,what can anyone do?And now my physical just became that much more.I suggest everyone watch their banks closely,if you see or hear anything funny,check into it and if you dont like the answer,buy real gold and silver and go hide it under your favorite tree.If you hide it well it will still be there when the banks arent.If the banks dont close,it will still be there.Good luck to all this week, i know the market is heading down,and i know gold should go up.But i cant help thinking the cabal boys have some sneaky contigency plan,like for instance "confiscation"!The euro most likely is the next thing by default.Once confidence in the us is shaken people will have 3 choices,gold'silver or the euro 15 percent backed by gold.Now i ask you,would you back your currency by something you knew was about to be hammered down,or do you back it by gold because they already knew what would happen?

In these times there is only one answer "diversification".Something has to give now!The truth is coming out,people want blood ,even lou dobbs, and they want answers!The problem is they wont like the answers they are going to get and then a true panic of epic proportions will ensue leading us God knows where?

BlackjackNext 2 weeks could be HUGE#8668710/05/02; 12:03:21

The election in Brazil this Sunday will bring attention to
the looming $360 Billion Brazil default.

The Japanese government has announced it will bite the bullet
and clean up the $435 Billion bad loan disaster. Weak companies
that are deeply in debt will be cut off from more credit. This
will lead to a wave of bankruptcies.

World Banks will have to deal with about $800 Billion in bad
loan losses from Japan and Brazil. That will rock at least a
few world banks. This will cause major concerns.
The FED will be pressured to lower rates.

The only investments to have now are cash and PMs.
Unhedged miners will rise with physical.

USAGOLD / Centennial Precious Metals, Inc.In bookstores for $14.95 (plus tax). Get it here for ONLY $5.95 ($3 postage)!#8668810/05/02; 12:04:20

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

kasperjackBlackjack#8668910/05/02; 13:07:05

"The Japanese government has announced it will bite the bullet
and clean up the $435 Billion bad loan disaster. Weak companies
that are deeply in debt will be cut off from more credit. This
will lead to a wave of bankruptcies.

World Banks will have to deal with about $800 Billion in bad
loan losses from Japan and Brazil. That will rock at least a
few world banks. This will cause major concerns.
The FED will be pressured to lower rates."

All is not clear here. Lower interest rate will increase the rate of capital outflow from the U.S. That might initiate a major and rapid run on the dollar. Ergo a large devaluation followed by a rapid increase in interest rates....
The wave of bankruptcies must include the banks unless the government is intent on letting the interlocked keiritsu corporations fall while injecting cash to cover the bulk the vaporized loans. Otherwise the bank depositers will have to foot some part of the losses. Right. I don't see how such an operation can be enacted in a keiritsu economy. The whole shebang would have to be written off. It was Keiritsu that created Japan Inc. The goverment has spent the last ten years running up a mountain of debt and hell knows whatever other costs to the defend the keiritsu quo;the Japanese establishment. You just can't write of the monied establishment. They are not about to give up power voluntarily. Ergo the real target is most probably the assets of the bank depositors.i.e. the keirtsu will take a hit and survive while the taxpayers and the savers of Japan get the shaft the bulk of the bill. What a mess.... And as I see the architect of the economic bubble blowing all our ammo on a furitive and treacherous campaign to cover his own ass I wonder if America is following the same path the Japanese embarked on 10 or so years ago. Image what historians are going to say about the clowns who allowed the creators of the mother of all economic bubbles to waste the prodigious wealth of the nation in an attempt preserve the very forces that gutted and looted America. Thank the lord that men of Churchillian stature like Ron Paul are looking in the right direction... whatever

Paper AvalancheToday's daily joke#8669010/05/02; 13:32:56

How many more times will this joke be told by the financial media?
Paper AvalancheWe don't want dollars, eh hoser#8669110/05/02; 13:36:05

Not only are the canucks raising interest rates to get a head start on the impending hyperinflation, they are implicity repudiating the greenback IMO.


sector@The Coin Guy - The ECRI's FIG#8669210/05/02; 13:49:01

The Future Inflation Gauge Rocketted to 25.9 % Annualized in September

That metric is watched by the Fed and signals that future rate cuts are not likely. Three Fed FOMC mouth pieces said as much on Thursday.

Canada is raising their rates. Japanese banks are fading after their SM hits a 19 year low[How's THAT for "Stocks for the long run" logic]. Brazil will default and crush what is left of JPM and Citi Bank and further depress the IMF's grand plans.

The Fed can't lower rates due to Fannie's "Duration gaps" and the refi money to pay bills. So the Fed is done as an effective mon etary authority as we enter the really bad phase of what Sir Eddie [BOE] George called the "Abyss".

A monstrous, out-of-control machine, headed for disaster.

Did I mention the war?

The CoinGuySector - Just happened to be checking in...#8669310/05/02; 14:13:21

Thanks for the comments...

Rising interest rates would fit into my investment scenario precisely. I've heard some call for possibly one more cut in November because the 90 day had them priced in. I felt like going against the grain on this one. There will be no cuts, is what my gut tells me. I guess we'll see.

I've already initiated short positions where I fell they need to be place and have covered 2/3rds of my bond position.

I'll add a few comments from the article I posted yesterday, because it can't be pulled up from the archives. FNMA's looks to be taking a gamble here too. It might buy them some time.

Snippit:Critics like James Bianco of have suggested that the situation is more complicated. In fact, Bianco thinks Fannie Mae's thrashing around to may have involved the purchase of the equivalent of $60 billion of 10-year Treasuries in September.

He suggests that, given Fannie Mae's size, this may be a large part of the reason for the drop in rates in September "Fannie Mae is still making an aggressive interest rate bet," Bianco wrote recently. "They are hoping the downtrend in interest rates will end and rising rates will further narrow their duration gap [the measure of the difference between its assets and liabilities].... Let's hope they get it right this time. They have not been right since June."

John Dizard, a columnist for the London Financial Times, has argued repeatedly that Fannie Mae (FNM: news, chart, profile) has simply become too big an actor in the derivatives market, is in an unstable situation, and will eventually have to be rescued by the U.S. government.

Snippit:An ominous sign for Fannie Mae is that Dow Theory Letters' Richard Russell is emitting bearish grunts about it. Russell rationalizes his concern in terms of the mostly-forgotten art of charting - he alerted his subscribers recently when Fannie Mae dipped below $60, its lowest level since September 2000.

Fannie Mae climbed vertically in late 2000 - could it fall vertically as well?

It's currently clinging on by its fingernails at $64.70.

The nice thing about charting is that you don't have to have a theory as to why the stock is acting the way it is. You let the price tell you what's going on. Russell thinks he hears the stock saying that "the bubble in housing is close to bursting." (See September 5 column).

But whatever Russell thinks he hears, given his rout of the bulls this year (see July 15 column), if this old bear's snout is twitching, look out.

The CoinGuy

TownCrierIn a flight to safety from stocks, bonds may rub salt in your wound with additional losses#8669410/05/02; 14:15:06

Here is a bit of helpful highgrading from the archives:
The Stranger (3/2/2001; 9:48:35MT - msg#: 49230)
Bonds versus Gold
Bonds have two kinds of risk. First there is credit risk. That is the risk that the bond issuer's ability to repay will diminish over time, perhaps to zero. This would reduce the value of the bond accordingly. Credit risk is not usually a factor when buying treasuries, but it is always a consideration when choosing municipals or corporates.

The other kind of risk facing bonds is interest rate risk. If you buy bonds at currently prevailing rates of return, and then the economy experiences a general rise in interest rates, your older, lower-yielding bonds will no longer be as attractive to new investors. You will have to mark them down in price to sell them.

...Bonds are poison when inflation rises. For this reason, they are often considered the investing antithesis of gold.

Bottom line: As the spot currency weakens in the eyes of the world's investors, the change in present value (the marketable price) of the bond will compound these losses as the bond represents a sort of futures contract on the denominating currency. The following flight from bonds can become a raging selloff spiral when the turn arrives. As the currency fails no interest payment stream will satisfy investors and bond prices will continue to plummet as the effective yield soars. Gold can preserve real wealth, bonds can't.


The CoinGuyApologize for the errors...was in a hurry#8669510/05/02; 14:19:32

The CoinGuy
TopazG-Bear re: Super.#8669610/05/02; 14:56:30

Good morning G-Bear,
I'll make enquiries first thing Tuesday about transferring lump-sums from an "industry fund" to a personal one while still employed - good point you make - I DO know you can't nominate a personal fund to accept employer contributions. There were plans afoot 12 mths ago to allow this but I've heard nothing lately. Perhaps the dismal performance of the industry funds will resurrect this proposal.
Like you I'm not really talking "sheepstations" but imo "several" Oz of GOLD in possession is vastly more sensible (currently) than it's dollar equivalent in "investments".


CoBra(too)Pessimists seen as Grave-Diggers of Economic Upturn!#8669710/05/02; 15:00:12

... Well, isn't true, you have to be an optimist to invest into the future.

Investment in the future, though, means you have to have the 'means' to invest in said future. The means to do just that, means savings.
Savings, unfortunately meant investment in the paper stock markets. The same markets which just wiped out about 50% of
your savings, the means to invest into the future in no time.

Actually, I'm one of those optimists. I even listen optimistically to all these economists seeing an upturn in the next half year, or so - for years. After the second half of 2001 didn't work out exactly in line with the economists forecasts; 2002 doesn't either.

Optimistically, we all look forward to 2003. Economic growth will resume with a vengeance. Everbody and his optimistic economist says so!

Sure thing; Being an optimist, I've already spent more than I can afford until 2008. I've also hocked my home to the last shingle on the optimistic perception that Fannie "may" be regarding my investment on optimistic consumption as refuelling the economy's motor.

Pessimists on the economy are the real terrorists. We should not let 'em get away with it and start a patriotic war against PET's (Pessimist Economy Terrorist).

The newly founded HM's EA (not Her Majesty's), but Homeland Security's Enforcement Agency against PET's proves once more that optimism is the only solution.

After all you may as well go broke, default, get foreclosed, wiped out, embezzled, kenlayed, koslowskied, derivativerized, CNBC'eed or bartoromorized, or even J-peed and optimistically chased if you'd stayed a knuckle-headed pessimist.

Uncle Sam and Sir Allan will provide the optimists with all the tender (il-legal as it may) ammuntion you care to take upon you to fight the pessimist. Even international organizations like the IMF, WB, BIS and other will fight any pessimistic sovereign (evil-)states by default.

... only one is optimistically running up his debts -to levels the most optimistic trading 'partners' perceive as ir-redeemable...

That's why - cb2 - the PET target of the day accumulates gold!

knotakareIs there a US fund that holds bullion?#8669810/05/02; 15:16:32

Is there a US fund that holds gold bullion as its main holdings? I think this may be a good place to put some of my self directed IRA funds after a run-up by the miners this winter. I want to get a prospectus for such a fund, and look it over.

Although I have believed for a long time that JPM's demise would be almost certain, to actually see JPM this past week in the throes of self destruction is most astonishing. What we don't know is how many others, including possibly mining firms, JPM could take down with it. Rising US interest rates may be the final nail for JPM's tenous hold onto continuing viability. I think the announcement by JPM on Friday, looked like it was announced to stem some of the panic that is now setting in. As we remeber in the and tech meltdown in 2000-2001, these well timed press releases only delay, to a small degree, the inevitable.

Have a great weekend all!


MarkeTalkRussia's Vladimir Putin: It's the oil, Comrade!#8669910/05/02; 15:22:41

Yesterday's Financial Times newspaper had a front-page article about Russia's backing of the US-British plan to attack Iraq. For those who don't know it, the Financial Times is the Establishment's (Council on Foreign Relations, Trilateral Commission) newspaper. The article went on to say that Russia's reluctance to support an attack on Saddam Hussein stemmed from the fact that Lukoil, Russia's biggest oil company, had lucrative oil contracts with Saddam, and that Russia was afraid of losing them in the likely event of an allied victory.

After much behind-the-scenes political maneuvering, Russia has been assured of its oil concessions. Next up is France and its oil company, Elf Aquitaine. So you see, comrades, it's all about oil and money. Don't be distracted by the politics and rhetoric--whether from George W. or Tony Blair or Vladimir Putin.


darkhorsea question...#8670010/05/02; 15:29:58

I might should already know this, but I don't...what do I do with EE savings bonds? The oldest ones are only a few years old, and relatively small denominations. Should I cash them in or leave them alone? I need some advice and I need to know why, the wife thinks I work for Warner know, Looney Tunes. These are the kids money, not even mine, but I don't want it gone before they even get close to being able to spend it. Thanks for the help.
GenooDeflation#8670110/05/02; 15:39:18

Have not posted for more than a year..have not read the forum until recently. Very pleased to see that Black Blade is as active as ever..also enjoy Sector's views.

Deflation seems underdiscussed..yet the all important US economy is recognized as being clearly on the ropes like never before..and simply waiting for the knockdown punch.

IMO anything economic that is negative,could do it Brazil on Sunday.

Reflation will follow in due course as surely as day follows night.

How can gold lose given this scenario..that, I don't know.

In the meantime let's all hope the downturn isn't too severe

LeighANOTHER Investment Question#8670210/05/02; 15:41:55

Is money in money market funds safe? My husband thinks our MM funds are perfectly safe, more so than stocks. Is that true? Thanks in advance, and I apologize if this question has been discussed before.
Belgian@ Turkey Hunter#8670310/05/02; 15:44:09

Bullion banks and others Always have their lender of last resort : The confetti printing and IR setting and currency exchange rate setting, central banks. The last bankrun in Japan - 1995, was a very short one. The victims that will suffer from the coming disaster will be carefully chosen and the financial torturing (sacrifices) will be extremely controlled and directed.

Indeed, we don't have the slightiest idea, about the "real" relationship between bullion banks > central banks > goldmine hedgers + private gold-holders. But, bet on it, that it is an already highly political relationship.
In politics "everything" is possible "anytime" !

What "if" the gold-derivative mega-super positions receive political backing as to turn this perceived dramatic situation into the banks savior : Erase the papergold trade and install TG's physical-only trade. What if it turns out that the BBs (JPM/C_GS_DB) are the owners of underground gold and its defaulting miners (deep storage stuff) ?
What if the nationalised/confiscated/taken over, underground goldmine forward sellers, have to dig it (gold) up at 300$/350$, when POG is already racing into the thousands in physical-only trade ?

Banks, pensionfunds and insurers are suffering from the low/lower SM valuations. The profits on their bond portfolios (40 yrs low IRs) are compensating for their underwater stock portfolios. But these bond-profits are not allowed to be booked as such. Because what happens when IRs should (will) rise again and these bond profits evaporate together with more declining stock valuations. Political rescue will be put available under God knows what form.
Banks nor politicians, care about the future purchasing power of the economic-inactive savers. They will save the running of the economy at the saver's expense.

Consider the no-VAT on Gold as a subtle (political)invitation, to savers, as to give you the opportunity to protect yourself with holding the physical in possession !
No VAT on physical bullion is a very strong *political* signal ! Name me one (1 only) other item that is NOT (zero)taxed ? Good WE and regards.

BelgianThe Comrade's oil....#8670410/05/02; 16:16:10

Two weeks ago, a highplaced Lukoil executive (oil-negotiator) had been kidnapped and released shortly after.
No explanations !
If a Russian (and German) minority can negociate, hefty oil profits from Iraq (after invasion/occupation), rival factions (against us, not with us), within Russia, will make Iraqi plunder very difficult ! The nuclear connections to all this !

IMVHO, the big surprise of future low POO and connected, economic pseudo-relance (!) will be very shortlived.
It's going to be a very long and complicated oil-war. The past 30 years of very cheap Arabian oil have come to a relative peacefull end. After Iraq it will be the Chechnya region wich has to become invaded and occupied.
Have a look, how Australia (a reliable US-ally) and Timor have settled things about rich and cheap resources. It wan't be that easy with ME/Russian resources.

aussieBrain Sees Doom In Out Debt Binge#8670510/05/02; 16:34:34

Just thought some of you, particularly the Aussies would be interested in the following article by Geoffrey Newman in the "Weekend Australian" Oct 5-6.

'The only major economist to have predicted the Asian financial crisis of the 1990's is now worried about the debt burden of Australian households.
Australian Institute for Economics and Industry Research chief Dr. Peter Brain says Australians are at risk of falling into the trap that snared Japan last decade and, in a worst case scenario, an Argentine-style currency crisis. Most economists will muddle through despite the weak global economy. But Brain says a housing slump could cripple the economy.
He is strongly critical of the Reserve Bank for keeping interest rates so low for so long and allowing households to rack up unsustainable levels of debt, now about 118 per cent of household income.
It won't just lead to a slump in house prices he says, but could be the economy's undoing by choking consumer demand and the blowing out the current account deficit.
"The level of indebtedness itself will gind down the economy like it did in Japan in the early 1990s. If not a severe recession, then Australia is in for a long period of below-trend growth".
Brain is not surprised that the RBA did not raise rates this week, given the backdrop of the weak global economy. But he says it may now be too late to do what the bank should have done up to four years ago when the housing bubble first showed signs of appearing.
"The household sector is so sensitive now to interest rate rises that, given the drought and other things, to significantly raise interest rates to prick the housing bubble would do very substantial short-term damage to the economy."
But the current account deficit may eventually force the bank's hand, Brain says. The CAD has ballooned to almost 5 per cent of GDP, partly because banks have borrowed overseas to fund the explosion in home lending.
He says there is a potential for a balance of payments crisis that would force the RBA to push up rates to slow the economy and attract foreign capital.
If it didn't, the currency would nosedive. "Australia's international indicators for currency weakness are quite high." he says. "We've got high short-term debt relative to reserves, indicators that have triggered currency crises in other countries like Argentia and Turkey."'

Blackjack@Leigh#8670610/05/02; 17:22:16

Pick a Money Market fund that is in short term US treasuries.
Knotakare check out symbol:CEF its a canadian fund.
Kasperjack I'm not sure what the Fed would do in a crisis.
I will be watching Brazil this weekend and over the next
couple weeks what Japan does with its $435 Billion bad
loan situation.

How Japan bails out which big bank exactly
and which weak bank will be allowed to fail and which will
be forced into mergers, I dunno how they will structure
the program. What I do know is this. Lenders that are the
bad loans will be cut off from further access to credit.
These companies will go bankrupt, the cleansing process.

Blackjackoops#8670710/05/02; 17:29:02

Those companies that are the "bad loans" will be cut off from
further access to credit. Most of these companies would be
forced into bankruptcy.

sector@Leigh - Yourt Money Market Fund May not be safe#8670810/05/02; 17:52:59

...unless it is a US Government backed money market fund

...such as RUSXX [YAHOO symbol].

See-- the uninsured money market funds are mostly linked to Fannie and Freddie which are linked to JPM which is a TAD weak these days and emulating ENRON's downward path.

The real panic will come with the first announcement of a "They 'Broke the buck'" from a big mutual fund. They will essentially return only a fraction of your balance.

If you object, they will say "Sue us". You will be in the same position as the Citi Bank depositors in Argentina who imagined they were protected because they were American citizens.

Robert Rubin personally shafted these people out of their savings while Congress watched.

The CoinGuyBelgian, ALL#8670910/05/02; 18:18:30


I just read your comments about the insurance industry, an industry I grew up in(my father owned an insurance company). If you do a little investigating, I think you'll find that these multinational insurance conglomerates all hold each other's debt. Couple that with declining bonds?

ALL: The $ par value in MM's is not a guarantee.

It looks like the normal investments vehicles, are in dire need of repair. Townie's post was timely as usual.

Headed off to a birthday party, my little niece is 1.

The CoinGuy

LeighBlackjack and sector#8671010/05/02; 18:23:09

Thanks, you guys. Our dilemma is that the remainder of my dad's estate money is still in probate in a money market fund. The trustee bank (BOA) has suddenly decided that they don't want to distribute the money until the middle of next year (five months late). This is after they lost over a third of the total estate by refusing to sell off worthless stocks, against the wishes of all the heirs and the executor. I have a feeling that by the middle of next year the money market funds will either have disappeared or be inaccessible. BOA has a "sue us" policy; they really seem to think the money is theirs and they'll do what they please with it.

"Ne committe negotium in ignotis manibus."

Gold StandardLeigh - just a thought#8671110/05/02; 18:49:14

It is possible to bring an application in a Court of Equity (eg Supreme Court) for removal of a Trustee where it can be proven that the Trustee is not acting in the best interests of ALL of the beneficiaries.

In terms of suing them for past losses, forget about it (at least in UK common law jurisdictions) because they will no doubt rely upon a "weasel clause" of trustee indemnification.

Hope this helps, but I'm only guessing when it comes to USA law....

Golden Bearaussie (msg#: 86705)#8671210/05/02; 19:12:23

Brain Sees Doom In Out Debt Binge...

Thanks for the info aussie, it confirms what my wife and I have been debating for the last year, that Australia's economy is only kept afloat at the moment by the property market, and when it rolls over, the economy will be cactus...

Just look at our currency, struggling to climb with the recent sell off of the US$, suggesting world demand for our commodities is not that strong, the property market giving the masses a false sense of security, and the real estate agents saying in other newspapers that there's no problem in the housing market - yeah right...


makcumka@ Topaz#8671310/05/02; 19:24:04

Last time I checked with my employer, the only way the retirement fund can be rolled over, cashed out, etc. is by first quitting and then by waiting 45 to 60 days (depends on what company manages the fund). If you cash out, they will take 20% tax plus 10 % penalty. And you still have to wait to give the government your money so you can have control of your money. Go figure.

I really hope you are able to roll over. My, now former emploer, still has my stash.

BlackjackFood prices a problem for the Fed?#8671410/05/02; 19:27:44

NEW YORK (CBS.MW) -- While most economists are worrying about the possibility that we might be slipping into deflation, prices of many basic commodities have begun to climb, suggesting a renewal of inflationary pressures down the road.

As compiled by the Commodity Research Bureau, the daily index of industrial raw-material prices -- the building blocks of goods production -- as is 10 percent above lows reached earlier this year.

More troubling is the jump in foodstuffs. The CRB's daily index of food commodity prices has shot up by 4 percent in the last 30 days alone -- and by a hefty 31 percent over the past two years.

The outlook is for more of the same -- thanks to widespread crop damage caused by the drought in the Farm Belt.

A telling example is wheat, prices for which have soared more than 60 percent so far this year as supplies have dwindled.

The Department of Agriculture has just cut its forecast of U.S. wheat production to 1.62 billion bushels-- a whopping 17 percent below last year's harvest. (Corn and soybean crops have been reduced as well.)

Price increases for wheat at the farm level in turn will quickly be reflected in the cost of such intermediate products as flour, then at the retail level in the form of higher prices for bread, cakes and the like.

Psychological dimension

The fact that food is a necessity is one reason why these price increases are troublesome. That food is consumed daily and purchased almost as often is problematic for policymakers -- mainly those at the Federal Reserve.

Because such big-ticket items as houses, household furnishings and motor vehicles are purchased infrequently, any price increases in these items take a while before they change people's attitudes towards inflation.

But since foods are bought so often, when their prices go up, they tend to boost inflation psychology as well. And while the business community could use a little inflation these days, the bond market would not be happy if this particular psychological mindset takes root.

Bond traders would show their displeasure by jacking up interest rates on the long end of the curve, something that might well put the kibosh on the housing boom.

And it goes without saying that the Fed has to take inflation psychology into account in setting monetary policy.

Right now, the fed funds futures markets have all but convinced themselves that the Fed will cut its key overnight lending rate by or before its next regular meeting for reviewing monetary policy, scheduled for Nov. 6.

But if food prices start to jump at retail, the Fed may well give the futures market an unpleasant surprise by keeping rates right where they are, potentially setting the staggering stock market up for another blow.
Puplava has mentioned this scenario.

Golden BearBelgian (msg#: 86703)#8671510/05/02; 19:29:22

"...Consider the no-VAT on Gold as a subtle (political)invitation, to savers, as to give you the opportunity to protect yourself with holding the physical in possession !
No VAT on physical bullion is a very strong *political* signal ! Name me one (1 only) other item that is NOT (zero)taxed ?..."

Sir Belgian, the humble Giants such as yourself in these esteemed halls continue to point out the subtle yet powerful signals which are being flashed before us by the politicians and other elites, but some of us(speaking for myself here) have not as yet been able to decipher on first read...

I feel as if I am surrounded by wise mentors, that continually point to the correct path at every fork in the trail, and are helping with the acquisition of knowledge and vital experience in comprehending the geopolitical landscape that we are faced with, no matter where in the world we may physically reside.

A mighty big Thank You to all the Giants at this forum, past and present for allowing their footsteps to be seen along the trail, and followed...

BlackjackGlobal Crash fears , the next Credit-anstalt?#8671610/05/02; 19:44:48,2763,805685,00.html

Stockbrokers around the world are braced for a potentially calamitous week as alarm mounts over a looming, Thirties-style global financial crisis. A leaked email about the credit-worthiness of Commerzbank, Germany's third largest bank, yesterday increased fears of the international stock market malaise exploding into a fully-fledged banking crisis.

Commerzbank lost a quarter of its value last week, raising the spectre of Credit-anstalt, the Austrian bank that collapsed in 1931, sparking global depression.

US stock markets have fallen for six consecutive weeks, to their lowest levels in five years. European markets have collapsed even further, wiping out nearly half of the value of European corpora tions in this year alone. Japan is struggling to put together a plan to save its banking system, riddled with bad debt after a decade of recession and falling prices. Now the German economy threatens to follow.

'There are strong parallels to the Thirties after an unsustainable "new era" boom,' says Avinash Persaud managing director for economics and research at State Street Bank. 'Then, the stock market decline was not just steep, it was long, taking three years to reach the bottom.'

'Commerzbank being affected is a sign of the severity. But in today's crisis risks have been offloaded from the banks to the markets and ultimately our pensioners, which makes the problem more difficult to deal with,' he says. The leaked email about Commerzbank was in response to an inquiry from a US investment bank about rumours of huge losses on credit derivatives, which aim to spread risk.

Figures due to be published on Friday will show that a toll of stock market falls, rising joblessness and war fears is finally denting the spending habits of Americans. Economists fear that the result may be a 'double-dip' US recession, taking much of the world with it.

Europe's finance Ministers, including Chancellor Gordon Brown, will meet in Luxembourg on Tuesday amid deepening concern about the stability of the financial system. Tomorrow evening, the Eurogroup of finance ministers, excluding Brown, will discuss reforming Europe-wide tax and spending rules along the lines of the British system, taking stronger account of economic difficulties.

In the US, the concern is that Alan Greenspan, chairman of the US Federal Reserve, has insufficient room to cut interest rates if the economy falls into recession. 'The [Bush] Administration has two lines of action: tax relief for the rich [and] reliance on the Federal Reserve. Both are without effect,' says US economist JK Galbraith in an interview with The Observer.
Thats John Kenneth Galbraith from the 30s!

Gimli_Russian Comments, Re:Debt Bomb#8671710/05/02; 20:11:07

Russian Expert Who 'Predicted' Attacks Warns of New Ones

Koryagina: There are international "super-state" and
"super-government" groups. In accordance with tradition, the
mystical and religious components play extremely important roles in human history. One must take into account the shadow economy, shadow politics and the religious component, while predicting the development of the present financial situation. Pravda: Still, I don't understand what could be done to this giant country [the U.S.], whose budget is calculated in the trillions of dollars.

Koryagina: It is possible to do anything to the U.S. ... whose total debt has reached $26 trillion. Generally, the Western economy is at the boiling point now. Shadow financial actives of $300 trillion are hanging over the planet. At any moment, they could fall on any stock
exchange and cause panic and crash. The recent crisis in
Southeast Asia, which touched Russia, was a rehearsal.

Koryagina: The U.S. has been chosen as the object of financial attack because the financial center of the planet is located there. The effect will be maximal. The strike waves of economic crisis will spread over the planet instantly and will remind us of the blast of a
huge nuclear bomb.

Koryagina: Recommendations, compiled by the Duma
Commission of Economic Politics after the recent Duma hearings, offer instruction on what should be done to escape the consequences of a world crisis inspired by a financial catastrophe in the U.S. This document will be sent - or has already been sent - to President Putin.

It should be taken into account here that in September 1999 Putin conveniently used the apartment explosions in Moscow and Volgodonsk (KGB-organized actions, in the opinion of most of the Russian media and in the opinion of the author) to gain supreme power in Russia.

Now the Kremlin is making statements about a "joint struggle
against world terrorism," about "the ties between the actions in New York and the actions in Moscow in September 1999."

Indeed, these are probably closely tied to one another, and the same forces are behind the actions in New York and Moscow. But what is the real name of these forces? The investigation should go to the bottom of the barrel and provide the proper answer.

turkey hunter@ Belgian#8671810/05/02; 20:27:38

Thanks for your response. Trying to figure out what this whole gold scheme is about is like putting a 5000 piece jigsaw puzzle together without knowing what the picture looks like. Sure is interesting trying to figure it out though.
mikalPort talks lead to partial shipping resumption#8671910/05/02; 20:45:00

Alaska, Hawaii Reopen as Port Talks Continue
October 05, 2002 07:43 PM ET By Elinor Mills Abreu and Andrea Orr
SAN FRANCISCO (Reuters) - Ports in Alaska and Hawaii were reopened for cargo shipments on Saturday, but port managers pledged to keep the docks from San Diego to Seattle shut until they could come to a labor agreement with unions.
A week into a crippling shutdown of 29 ports along the U.S. West Coast, the International Longshore and Warehouse Union urged managers to let them unload some cargoes containing food and perishable items before they rotted at sea.
But the Pacific Maritime Association, which late Friday agreed to let goods flow into Alaska and Hawaii -- both extremely dependent on imports for food and basic items -- said it was not prepared to make any more exceptions.
Military cargo has been allowed through during the work stoppage, but all other shipments have been halted.
The lockout of 10,500 longshoremen by employers who control ports from San Diego to Seattle is costing the fragile U.S. economy an estimated $1 billion a day as outgoing cargo piles up on the docks and incoming cargo ordered by retailers for their Christmas rush sits aboard ships off the coast. Some 173 cargo ships are now idled up and down the West Coast, with about 20 more arriving daily.
......Some $300 billion in cargo flows through West Coast ports every year, and after one week, the lockout has already had an impact on several sectors of the economy, from farming to manufacturing. Growers in California's fertile Central Valley have opted to leave crops in the field until the ports reopen trade to Asia.
And in export-dependent Asia, fears were mounting that the U.S. work stoppage could threaten the economy there. Morgan Stanley warned on Thursday that East Asia could fall into recession within a month if the lockout continued.
Peter Hurtgen, director of the Federal Mediation and Consolidation Service said during a break in the talks on Saturday that he would stay at the bargaining table "all day and into the night if I have to." link for more.

Golden BearSummary of this week's carnage, by Doug Noland...#8672010/05/02; 21:22:05

October 3 – Financial Times : "Credit Suisse, the Swiss financial services group, yesterday issued its fourth profit warming in a year after pumping another SFr2bn of its own capital into Winterthur, its loss-making insurance operations. The group, which has only reported a profit in one of the previous four quarters, said its third-quarter results would be affected by a ‘significant net loss’ in its insurance business and a ‘modest overall negative effect’ from the group's other businesses."

Credit Suisse, Switzerland's second largest bank, today saw its stock sink 16% to a nine-year low (down 69% y-t-d). The stock lost about 28% of its value this past week alone. The company is suffering heavy losses in its investment portfolio (and at CS FirstBoston), and is being forced to make large capital infusions to its insurance unit. German banks remain under heavy selling pressure. DeutschBank sank 13% this week, increasing its 2002 decline to 47%. Commerzbank sank 18% this week and is now down 66% for the year. The stock of German financial conglomerate Allianz sank 13% this week, increasing 2002 losses to a staggering 70%. Moody's today downgraded the ratings of Allianz banking subsidiary Dresdner, and stating that Allianz rating "may still be cut." Dresdner's financial strength rating was cut from B minus to C, with more downgrades possible. BNP Paribas, France's largest lender, saw its share price sink 20% this week (y-t-d down 42%). ABN Amro, the largest Dutch bank, dropped about 8% this week (down 37% y-t-d). The shares of Swiss's UBS dropped 13% this week (y-t-d down 33%). Abbey National, the U.K.'s second largest mortgage lender, saw its stock price sink 10% this week on concerns that it will be forced to take a major write-down for losses in its insurance unit.

The European insurance meltdown runs unabated, with the Bloomberg European index sinking 4.5% today. With the list of companies hoping to raise equity lengthening by the week, index year-to-date losses have grown to 53%. Zurich Financial saw its share price drop another 4% this week, with 2002 losses now at 65%. Swiss Re saw its stock sink almost 10% this week, with y-t-d losses at 53%. The Dutch insurer Aegon also announced a rights offering, with y-t-d losses of 66%. France's Axa also dropped about 10% this week, with 2002 losses at 57%. UK's Royal & Sun sank 10%, with y-t-d losses at 76%. French reinsurer Scor saw its price drop 28% this week, with 2002 losses at 79%.

knotakareThank you Blackjack#8672110/05/02; 21:33:34

Thank you very much for the info on the bullion fund CEF. I will check it out this week.

Best regards, kak

CytekGlobal crash fears as German bank sinks #8672210/05/02; 21:50:53,2763,805685,00.html

Here we go again, just like 1931.
Faisal Islam, economics correspondent and Will Hutton
Sunday October 6, 2002
The Observer

Stockbrokers around the world are braced for a potentially calamitous week as alarm mounts over a looming, Thirties-style global financial crisis. A leaked email about the credit-worthiness of Commerzbank, Germany's third largest bank, yesterday increased fears of the international stock market malaise exploding into a fully-fledged banking crisis.
Commerzbank lost a quarter of its value last week, raising the spectre of Credit-anstalt, the Austrian bank that collapsed in 1931, sparking global depression.

US stock markets have fallen for six consecutive weeks, to their lowest levels in five years. European markets have collapsed even further, wiping out nearly half of the value of European corpora tions in this year alone. Japan is struggling to put together a plan to save its banking system, riddled with bad debt after a decade of recession and falling prices. Now the German economy threatens to follow.

'There are strong parallels to the Thirties after an unsustainable "new era" boom,' says Avinash Persaud managing director for economics and research at State Street Bank. 'Then, the stock market decline was not just steep, it was long, taking three years to reach the bottom.'

'Commerzbank being affected is a sign of the severity. But in today's crisis risks have been offloaded from the banks to the markets and ultimately our pensioners, which makes the problem more difficult to deal with,' he says. The leaked email about Commerzbank was in response to an inquiry from a US investment bank about rumours of huge losses on credit derivatives, which aim to spread risk.

Figures due to be published on Friday will show that a toll of stock market falls, rising joblessness and war fears is finally denting the spending habits of Americans. Economists fear that the result may be a 'double-dip' US recession, taking much of the world with it.

Europe's finance Ministers, including Chancellor Gordon Brown, will meet in Luxembourg on Tuesday amid deepening concern about the stability of the financial system. Tomorrow evening, the Eurogroup of finance ministers, excluding Brown, will discuss reforming Europe-wide tax and spending rules along the lines of the British system, taking stronger account of economic difficulties.

In the US, the concern is that Alan Greenspan, chairman of the US Federal Reserve, has insufficient room to cut interest rates if the economy falls into recession. 'The [Bush] Administration has two lines of action: tax relief for the rich [and] reliance on the Federal Reserve. Both are without effect,' says US economist JK Galbraith in an interview with The Observer.

It's becoming quit clear that whatever green spickit or Bush does it's not going to help the coming collapse

Topazmakcumka.#8672310/05/02; 23:58:15

Thanks for the input mate, I remember being in a similar position as you a few years ago...waiting...waiting for the cheque, hope it all goes through smoothly.
The cash out option is n/a this time around as it's all "preserved".
Do you think it might be a bit TOO cheeky if I offer my services as financial adviser to the industry fund based on the stellar performance of my own Physical Gold Fund? (big wink!)

BlackjackRussia drives a hard bargain on Iraqi oil!#8672410/06/02; 00:04:43

Russia's biggest oil company has been assured by President Vladimir Putin that it will be able to keep its huge stake in Iraq's oil fields should Saddam Hussein be deposed, as Moscow seeks to extract a heavy commercial price for backing the US's hardline position on Baghdad.

As Washington seeks to win Moscow's approval for a tough new United Nations resolution, analysts said Russia was using its status as a permanent veto-holding member of the UN Security Council to maximise its commercial gain from the situation.

Vagit Alekperov, president of Lukoil, told the Financial Times that Mr Putin had made the issue of Russia's oil concessions in Iraq a top priority. "I have been hearing guarantees from the Russian government," he said. Even if the regime fell, Mr Alekperov said, "the law is the law, the state is still there".

Mr Alekperov said the government had assured him Lukoil would not lose its valuable assets in Iraq's West Kurna oil field, one of the world's largest with estimated reserves of 20bn barrels.

Washington has aggressively sought Moscow's support for a UN resolution that would set tough rules for Iraq's disarmament and possibly open the way for a US military attack. But deep divisions remain, with Russia resisting a new resolution and refusing to give the US immediate authority to strike.

Raad Alkadiri, analyst at PFC energy, a Washington-based consulting firm, said Russia knew the commercial worth of its diplomatic weight. "Russia's strategy in the UN for the last few years has basically been to seek to be courted by the Iraqis, the Americans or anyone else who was willing to give them the best commercial deal and in the past two years the US and Iraq have been fighting over Russia's pocket."

Asked whether he had received assurances that oil was at the top of Moscow's agenda in negotiations with the US, Mr Alekperov said: "Yes, of course."

He added: "We try to understand the political situation, especially these last weeks, and we are engaged in constant dialogue with the Russian government."

Lukoil, in which the Russian government owns a 14 per cent stake, has invested more than any other Russian company in Iraq's oil fields. With a market capitalisation of $13.4bn, Lukoil is Russia's largest oil company in terms of reserves. It holds a 68 per cent stake in the $6bn total investment in the West Kurna field, which lies 62 miles north-west of Basra.

But neither Lukoil nor other companies have been able to bring about their projects in Iraq because of the UN's 12-year sanctions regime. Iraq has used the lure of oil deals to gain political favour with Russia, its key ally in the Security Council.

But if Mr Hussein is overthrown those deals could become worthless.

However, Mr Alekperov said he expected that Washington and Moscow would eventually work out their differences, citing the recent co-operation between Mr Putin and US president George W. Bush since the September 11 2001 attacks.
Just a few days ago I was thinking to myself that the Russians
are concerned about their investments in Iraqi oil. Saddam wants
to appeal to the Russians to veto war and in return get access
to oil fields.

Bush has pulled off a biggie. He has promised the Russians that if they support war, their oil interests will be
protected. Saddam's oil fields are being divided up as we speak!
Saddam is watching his fate go up in smoke, incredible.

Its about OIL stupid! With Russia switching to US, China will
probably go along. When Russia, France, US , UK and China all agree on who gets what in Iraq, the UN security council will back Bush.

The path is clear now. Cool weather starts in mid November
and lasts until March. The window for the war.

The war will take the public's mind off the coming economic
collapse. Bush is hoping to get cheap oil to fuel an economic
rebound, isn't history fascinating?

BlackjackTakenaka ``We won't prevent bankruptcies at companies just because they are big.''#8672510/06/02; 00:24:36

Takenaka's predecessor estimated banks' bad loans at 52.4 trillion yen after a series of bank inspections earlier this year. Standard & Poor's puts the number at three times that.

``The inspections were very strict,'' Takenaka said, ruling out re-inspecting banks' balance sheets to check for bad loans. ``The issue is how to assess the results of those inspections.''

Japan spent a total of 9.3 trillion yen to bail out banks in 1998 and 1999; still, bad loans kept growing. Those injections didn't fix banks because they were done ``in a panic,'' Takenaka said.

``This time we have the chance'' to assess banks' asset and capital levels and improve their governance, he said.

As it forces banks to write off bad loans, Japan won't protect large companies from bankruptcy, Takenaka said.

``Having bad companies exit and letting good companies grow faster -- this is a given in a capitalist economy,'' Takenaka said in the taped interview. ``We won't prevent bankruptcies at companies just because they are big.''

Both Shiokawa and Takenaka ruled out extra government spending to offset an economic slowdown as crackdowns by banks force companies out of business and throw more people out of work.
Who would want to be short Gold and Silver in this scenario?
We live in interesting times, thats for sure.

BlackjackSheeple getting angry! Execs need protection, no, not that kind.#8672610/06/02; 00:35:20

By Lauren Weber

NEW YORK (Reuters) - At a time when companies all over are axing employees, Winston Pingray makes sure resentful workers don't respond by turning the ax back on executives.

CEO protection is big business these days.

Pingrey, a bodyguard and security consultant, escorts laid-off workers from the grounds of high-tech companies in California's Silicon Valley. When those workers get angry and start threatening the company brass, he coordinates round-the-clock security plans to keep the executives safe.

Pingray and other security experts say violent threats against executives have risen in the last few months, in the wake of scandals, bankruptcies and massive layoffs that have punctured employees' perception of corporate chiefs.

"People are directing their animosity toward the chief executive," said Paul Viollis, head of private client services at Citigate Global Intelligence and Security, a New York-based corporate security firm.

In the last month alone, Viollis has coordinated security for two CEOs who received death threats from former employees. In one case, he said, the executive's children were also threatened.

"There's no question about it," he said. "Inside our business intelligence practice, the phones have been ringing quite a bit in the last few months."

Personal security is written into employment contracts for high-profile CEOs -- often including home security systems and drivers who double as bodyguards -- but the recent wave of bad news has intensified concern about revenge-related attacks.
Black Blade this post is for you.
Bone Pile getting angry apparently. Haven't heard about this on the news! Its a mad mad mad world.

aussie(No Subject)#8672710/06/02; 02:10:21

The contributions by all those in this group are truly great, thank you all.
Goldenbear, you sure were right when I first came on to this forum, - you gave me the advice to listen to the Giants, - they certainly know what they are talking about! Socially, politically and economically things are certainly hotting up. I am grateful to this forum's contributors who know where to go to get the real facts and take the time to dispense the info. to the likes of me.
I have just opened mail from Placer Dome who have extended their offer to the 11th Oct to Auriongold shareholders. Has anyone else been saddled with the shares and have any clues as to whether to hold out or take up Placer's offer. Placer seems very determined on this one and as far as I can see it is now a foregone conclusion as they hold so many shares in Auriongold.
Thanks and cheers.

BelgianConcern about the stability of the financial system....Luxemburg !#8672810/06/02; 03:57:37

And here comes the super-politization of that zombie political economy of ours.
The IMF urging, Euroland, again to lower its IRs ! Knowing very well that IRs should have been already much higher.
I have the strong feeling that the defenseless, aging saving-pensioners are going to be sacrificed with a poor old day.

How long can we maintain near zero % IRs ? And is a brutal stop and exploding reverse-up of IRs avoidable ?
US consumer debt (US=US$ manager) stands at 7 TRILLION.
Total US non-financial debt is at 20 TRILLION. Mortgages, credit(debt) cards, installment loans to be serviced at an average of 7% = 1,4 TRILLION a year or 12% of US's GDP of 38 Trillion. Zero % IRs makes these debtbergs lead-heavy.
Inflating them away with super high IRs is the deadknell for the global economy. All this while POO puts the (stagflation) pressure on the dumbnails. A gigantic political (monetary) maneuver is in the cards. Gold will shine as never before.

Thanks blackjack for posting your interesting net-searches.

Golden BearPowerful quote...#8672910/06/02; 06:17:24

Watching the movie American Beauty on TV and one of the characters just stated:

"Never underestimate the power of denial"

This is what allows us presently to accumulate physical for absurdly low prices, while the masses are losing their shirts in the markets...

BoilermakerMusings#8673010/06/02; 06:18:34

Sunday morning musing while catching up on the forum and waiting for my wife so we can go to church. The postings of Friday and Saturday were exceptional and my sincere thanks to all engaged in the exchange of news and theory. I think we all sense that "the big one" is coming soon to the country where we may live.

Lately whenever I'm at a social function I usually try to explore economic/financial/investment sentiment with folks who have some interest in that subject. Needless to say the general response is resignation to the current malaise but no alarm that would stimulate drastic self-preservation action. When I offer my typical economic doomsday prophesy I feel like that raggedy bearded prophet that frequently showed up in New Yorker cartoons wearing a sandwich board saying "Repent. The end is near" along with some comical footnote at the bottom of the sign such as "Please ignore this message if you've already repented". We goldbugs have been a motley bunch of prophets who are often portrayed as cartoon characters in the financial media.

The internet has given us a forum and a cohesiveness that has brought us the gift of exceptional communication and learning from each other. Non-linear, outside the box thinking is our forte in a world where nearly everyone else is still convinced (or wants to believe) that we've just hit a patch of bad road and there's no bridge been washed out a mile down the road.

Oops time to go, keep those cards and letters coming.


RockBoilermaker#8673110/06/02; 07:04:33

Good morning my friend, long time since I think I read your words. As yourself I too will be leaving for church in a short time to give all honor, praise and credit where do. While slaying the beast this past Friday at the health club I stuck a conversation with a middle age woman and as I as probing for market sentiment as you do Boilermaker I brought up the fact that third quarter penions and 401 statements were coming out soon and I don't think folks are going to be happy with what they see.

Her response was, "I won't even look at mine." Did someone just mention even today that denial was a strong force? I read the other day where one of the memebers of this elite group mentioned about people who stick their heads in the sand thinking all is fine and dandy, they too have to come up for air sooner or later.

Well another week of horror on Wall Street. I find it amusing that you still have cheerleaders on the networks saying now is the time to get in howbeit there's just as many also saying not so.

Have a great day all, talk to you soon.


mikalOil tanker explodes#8673210/6/02; 08:00:40

Country Sites|Professional Products|Careers|About Reuters

Oil Tanker Explodes Off Yemen; Attack Not Ruled Out
Sunday, October 6, 2002 By Mohammed Sudam
SANAA, Yemen (Reuters) - An explosion ripped through a French oil tanker off the coast of Yemen Sunday, igniting an inferno that French diplomats and Yemeni officials said could have been caused by leaking crude or a bomb attack.
Government officials said the Limburg, with 25 crew members on board, was coming into the southeastern Mina al-Dabah port in the Gulf of Aden when its hold leaked crude and exploded.
But an official source in Paris said France had strong indications that the blast was a deliberate attack.
"A very serious sign, solid information should permit us to support this view," said the source, who declined to be identified. "This is not a theory without any foundation."
Earlier, French Vice Consul in Yemen Marcel Goncalves said it was still too early to tell whether the explosion was an accident or was caused by a small boat laden with explosives ramming into the Limburg.
"So far, there are many contradictory reports." he told Reuters. "The ship is burning and sinking."
The Yemeni officials said the coastguard had so far rescued 17 crew members who are at a hospital in Aden. The rest of crew members were still on board the burning ship, they added.
.....Last month, the navy warned oil tankers of possible attacks by al Qaeda. Naval spokesman Lieutenant Chris Davis told Reuters Sunday the Fifth Fleet, which covers the region, was not planning to step up its patrols after the Yemen blast.
"The U.S. Navy will continue with its state of readiness," Davis told Reuters from the Fifth Fleet headquarters in Bahrain. "There are no specific moves yet to step up patrols.".....more at link. Energy costs rising. Two Gulf of Mexico hurricanes suspended drilling and operations, OPEC has maintained output quotas, Bush, Blair, Sharon war premium on oil, and the fear of terrorism.

TruthcasterOil Tanker Off Yemen Was Rammed Bloomberg#8673310/6/02; 08:21:53

Bloomberg Is Reporting That The Oil Tanker Off
The Coast Of Yemen Was Rammed By An Explosives Filled
Small Boat.

BoilermakerMore Musings#8673410/6/02; 08:58:44

Rock, Thanks for the Sunday welcome. Today's sermon was entitled "Faith of Our Fathers" in celebration of Faith and Freedom Sunday. This is a subject I feel strongly about and it reinforces my view that the corruption of our money will be the downfall of our economy just as the "separation of church and state" has/will be the downfall of our moral foundation. The two processes are clearly linked IMO.

A month ago we got together with my wife's family for dinner. My niece and her boyfriend were in town for the weekend from NYC where she works for CSFB as an executive assistant and her boyfriend is a rookie trader for Morgan Stanley where he trades QQQ's. As the conversation got into economic territory I started my gloom and doom scenario as the family collectively groaned. What surprised me was that the MS rookie said that he had similar misgivings and was looking at gold (before I had said anything so provocative). Anyway, don't write off all the insiders, some of them are doing one thing in public and quite another for their own accounts.

This PM I'll be at a BD party with some economically successful people. If my wife's not looking I'll down some quick ones and start working the room for some economic views and plans. Hopefully I won't turn into the proverbial turd in the punchbowl. Wish me luck.


sectorGlobal crash fears as German bank sinks#8673510/6/02; 09:54:26

The Observer - The Guardian UK

Faisal Islam, economics correspondent and Will Hutton
Sunday October 6, 2002

Stockbrokers around the world are braced for a potentially calamitous week as alarm mounts over a looming, Thirties-style global financial crisis. A leaked email about the credit-worthiness of Commerzbank, Germany's third largest bank, yesterday increased fears of the international stock market malaise exploding into a fully-fledged banking crisis.

Commerzbank lost a quarter of its value last week, raising the spectre of Credit-anstalt, the Austrian bank that collapsed in 1931, sparking global depression.

US stock markets have fallen for six consecutive weeks, to their lowest levels in five years. European markets have collapsed even further, wiping out nearly half of the value of European corpora tions in this year alone. Japan is struggling to put together a plan to save its banking system, riddled with bad debt after a decade of recession and falling prices. Now the German economy threatens to follow.

'There are strong parallels to the Thirties after an unsustainable "new era" boom,' says Avinash Persaud managing director for economics and research at State Street Bank. 'Then, the stock market decline was not just steep, it was long, taking three years to reach the bottom.'

'Commerzbank being affected is a sign of the severity. But in today's crisis risks have been offloaded from the banks to the markets and ultimately our pensioners, which makes the problem more difficult to deal with,' he says. The leaked email about Commerzbank was in response to an inquiry from a US investment bank about rumours of huge losses on credit derivatives, which aim to spread risk.

Figures due to be published on Friday will show that a toll of stock market falls, rising joblessness and war fears is finally denting the spending habits of Americans. Economists fear that the result may be a 'double-dip' US recession, taking much of the world with it.

Europe's finance Ministers, including Chancellor Gordon Brown, will meet in Luxembourg on Tuesday amid deepening concern about the stability of the financial system. Tomorrow evening, the Eurogroup of finance ministers, excluding Brown, will discuss reforming Europe-wide tax and spending rules along the lines of the British system, taking stronger account of economic difficulties.

In the US, the concern is that Alan Greenspan, chairman of the US Federal Reserve, has insufficient room to cut interest rates if the economy falls into recession. 'The [Bush] Administration has two lines of action: tax relief for the rich [and] reliance on the Federal Reserve. Both are without effect,' says US economist JK Galbraith in an interview with The Observer.

Perhaps CommerzBnak is a counter party to JPMorgan's derivatives?

As far as the Fed not having room to lower rates it has already stated its preference to not lower rates further [Thursday by three top FOMV mouthpieces].

sectorOn Reform, It's Time to Walk the Walk#8673610/6/02; 10:14:55



AFTER almost a year of ceaseless and stupefying scandal, investors know that if trust is to be restored in the financial system, radical change must come from executives, Wall Street and the accounting industry.

Too bad that those who need to do the reforming don't seem to agree. As the results of two new studies show, one about accounting firms and the other about securities analysts, the business-as-usual crowd still reigns.

It is widely acknowledged, for example, that conflicts of interest arise when accounting firms provide both auditing and consulting services to clients. The fees from consulting have vastly exceeded audit fees recently, making it harder for auditors to call out big clients over questionable accounting practices.

But while investors' concerns about auditors' independence are running high, companies seem unfazed. According to an analysis by the Investor Responsibility Research Center in Washington, consulting fees still dominate, and fewer companies have hired different firms for auditing and consulting services this year than did so in 2001.

The center's comprehensive annual study of 1,240 American corporations shows that the proportion of fees paid by companies for nonauditing consulting services came in at exactly last year's level: 72 percent of the total paid. Average consulting fees were about $3.2 million, compared with $1.3 million for average auditing fees. And while nine companies used different firms to audit their results and provide consulting services last year, only six have chosen to do so in 2002.

Denial is a powerful thing. And entrenched business practices, especially those that are immensely profitable, will always be hard to change.

But it is nonetheless remarkable how deep the resistance to change is in the upper echelons of business and on Wall Street, even after trillions of dollars have been lost by investors.

Which brings us to the recent study of research analysts conducted by Weiss Ratings, an independent provider of ratings and analyses of financial services companies, mutual funds and stocks.

If any single group should be racing to change behavior, it is these folks. Analysts, under suspicion for some time, have been under investigation for more than a year. Thanks to these investigations, investors know with certainty that analysts routinely recommended shares to keep their firms' investment banking clients contented.

But the cheesy cheerleading goes on. According to Weiss, three out of four brokerage firms covering companies that filed for bankruptcy from May 1 to Aug. 31 kept "buy" or "hold" recommendations on those companies' shares as they made their filings. Of the 62 brokerage firms studied, 34 failed to issue a single "sell" rating on any company that filed for bankruptcy in the period.

Firms issuing "buys" on bankruptcy filers include CIBC World Markets, J. P. Morgan, Thomas Weisel Partners, Bank of America and Raymond James.

"Given the highly misleading ratings still being disseminated by the brokerage community," said David Lackey, the president of Weiss Ratings, "it's no wonder investor confidence in the markets remains low."

If corporate executives and Wall Street sharpies want investors' respect, they must prove they are doing something to make dubious practices a thing of the past. They should stop denying the problem and quit trying to circumvent change by calling in chits from their friends in Washington.
She is on the war-path and intends to wage a personal battle against Wall Street corruption. I pointed this out about a month ago on this board and now we see it continuing.

The scum purveyors of MER, GS and the others are in for a long slide down to the bottom. They will be ranked with tobacco CEOs and child molesters.

GenooLULA#8673710/6/02; 10:19:26

The uncertainty with the Brazilian election is not who will win but what Lula might do. When I read that he is a former unemployed steelworker..and no prejudice intended here...the table tilts in favor of him spurning the IMF [severing all lines of credit ala Argentina] and going it alone and damn the torpedoes.
BoilermakerBrazil#8673810/6/02; 11:12:37

I was watching a French news broadcast on SCOLA yesterday and they had a segment on Sao Paulo businessmen using helicopter taxis to get around the city mostly for safety reasons. They also spoke of extreme crime stats for the city. I'd like to hear more about this from Ari694? if he's about. Sounds like Brazil is breaking down. If so what is the cause. If Lula's elected does that suggest a turn to socialism? I'm curious about the human dynamics that are causing this rebellion. Might give us a clue for what will happen elsewhere.
BelgianOil Tanker in Jemen.#8673910/6/02; 11:21:38

Whoever did it, or is responsible, fact is that it gives us plenty of evidence that the *POO* (price of oil) will remain at the epicenter for a long time to come. Most of the 1,2 Billion islamists, worldwide, have been anesthesized with relative small oil-handouts in the past.
If Yemen is to come under the classification of "axis of evil", Saudi Arabia will be encircled and the entire moslim community will take this as straigthforward Arabian oil confiscation. Religious antagonism >>> oil war or war on oil or war for oil ?!

Will wait and hear (decode) what President Bush will say on monday in his Iraq speech ?

RockBoilermaker...O ye of great faith! #8674010/6/02; 12:45:57

Your Sunday message was indeed a good one for without faith it is impossible to please God. If the guy who was a black belt in karate didn't believe he could break that two by four he couldn't do it in fact he'd probably break his hand. Likewise one of the "black belt" verses of scripture that has helped me break through different obstacles in life is found in Romans 7:14, "Call things that are not as though they were."

Every major challenge that I have encounterd I faced with faith. I know there's a purpose for everything that happens to each of us even if we don't understand it at the time. For example in November of 1998 I had resigned from a major dental company in which I was not only making the most money I have ever made in my life but I loved my job as lead sales associate. I was half way there (10years) to my pension but due to the unfairness and misery I had been subject to for the last four years of my tenure I finally had to throw in the towel.

Now as you know 1998 was almost a peak in the stock market as well as my 401K to which I had been deducting 10% plus the employer contribution of 10% over a ten year period. I ended up with a six figure check. I would have never received that money had I still been with that company and I would have lost over half of my 401K like everyone else. After my 401K was released to me it was possible for me to invest in precious metals as well as my emergency staples program.

But the point I am making was at the time I resigned from that company I didn't know what to expect and that was a little scarey. I was very upset over the whole thing for quite some time but after looking back now I wouldn't have changed one single event. I wouldn't be sitting here today with my finanical house in order had I still been there. Looking back from my vangage point of today I know I made the right decision. I requested my employee file upon leaving and after reading my file I discovered on two different occasions the sales manager suggested my termination. I was a marked man.

So hind site being 20/20 I'm glad I resigned with dignity restored instead of getting fired. What's more important: 1) To have a good paying job and whats left of your funds locked up in a failing 401K and no liquity to purchase precious metals and get out of credit card debt or 2) To have an average paying job that you also love but have all your debt paid in full and have a heritage of gold and silver you faimly to last generations to come? I pick 2.



BoilermakerFaith & Opportunity#8674110/6/02; 14:07:35

Rock, when the job sucks, hit the road. I retired 6 years ago after 35 years with B&W. I was always a maverick at the company and the chiefs were a bit uncomfortable with me. But during that time I had some great bosses who let me do things my way and weren't worried about politics. Problem was the conventional steam power generation business was in the dumper for so long that it was getting depressing working in that field. Plus, McDermott bought B&W in 1978 and had milked the financial guts out of B&W to invest in their offshore O&G engineering business (that went way south) during the 1980's.

As for religion and gold, my latest plan is to turn over my stash to my church if the feds decide to confiscate. I'll get along without it and it will make me feel good.


BlackjackTankers becoming targets of attack#8674210/6/02; 15:12:24

Royal Dutch/Shell Group and other international companies shipping oil out of the Persian Gulf have been warned by U.K. intelligence that tankers are becoming targets of attack, a person familiar with the matter said.

``We never discuss security issues,'' said Kate Hill, a London-based spokeswoman for Shell, declining to comment.

The U.K. intelligence agency suggested that allied naval forces should escort oil tankers in convoys to deter any attack, the person said. Such escorts would be a ``daunting task,'' Commander Frank Merriman, a U.S. military spokesman, said.

Crime in Brazil is big big problem. Right now a gangster chief
known as Freddy Seaside is being held in jail. The crime gangs
are threatening to disrupt elections unless he is released.
Organized crime has penetrated to the highest levels in
Brazil, (like the US), but street crime is much much worse.
The army is out to protect polling places. Brazil is second
in murders after Columbia.

As for Lula, he is an old time communist.

R PowellLooking for story source#8674310/6/02; 16:47:59

There was some talk recently about a 22% production cutback or downturn in Mexican silver. Does anyone know anything about this? Any news links or articles?

Sector gave the opinion that the silver may have been supplied to the market without being recorded on the books to ease a possible tight market without instigating any price hikes. I'd like to get the basic facts before conjecturing any supposins. Did anyone else hear anything?

mikal@R.Powell#8674410/6/02; 17:57:17

That decrease in production was unusual. Sector's suggestion makes much sense. Also, if silver is primarily a byproduct of zinc, copper and other base metals mining in Mexico, to the same extent as elsewhere, would output be much less due to lower industrial demand, weakening prices, and reduced exploration and start-up activity? Regards
R Powellmikal#8674510/6/02; 18:09:58

Most silver production is, as you say, a by-product of copper, zinc, lead or gold mining so the price of silver does not increase or decrease silver production very much.
Primary silver mining (about 25% of total production) has been cut back, shuttered or postponed as primary producers are price sensitive. But, whether from primary or secondary sources, do we have a news link or article to confirm the 22% cutback rumor??

BlackjackJapanese Banks stocks continue to fall#8674610/6/02; 18:32:31

Tokyo, Oct. 7 (Bloomberg) -- Japanese stocks fell on concern a government bad-loan task force may recommend seizing weak lenders and forcing their worst customers into bankruptcy. Banks such as UFJ Holdings Inc. were poised to fall.

Exporters such as Toyota Motor Corp. declined after lower earnings forecasts from their U.S. rivals such as Boeing Co. and EMC Corp. sent the Dow Jones Industrial Average to its lowest level in almost five years, heightening concerns that demand from Japan's biggest overseas market may slow.

The Nikkei 225 Stock Average lost 107.52, or 1.2 percent, to 8920.03, as of 9:02 a.m. Tokyo time. The Topix index dropped 10.60, or 1.2 percent, to 881.00, with compute-related companies and banks contributing to more than a quarter of the index's drop.

RockBoilermaker#8674710/6/02; 18:39:29

First I wanted to correct that verse I quoted earlier. It's Romans 4:17 not 17:4. See what a difference pressing the wrong button will do? Hey Boilermaker I thought that was pretty good idea about giving it all to the church before the government could get their grimmy little hands on it, I would do the same if it came down to it.

Cheers mate,


BlackjackNikkei dropping fast down 2.6%#8674810/06/02; 18:55:34^N225&d=c&t=1d&l=on&z=b&q=l

This is something to watch. Banks weak.
Paper AvalancheWhat does hyperinflation bring?#8674910/06/02; 19:01:55

Here is a real life, real time account of hyperinflation ravaging a nation.

The foolish man assesses that an outcome with a low probability is impossible and fails to prepare as a result.

Take Black Blade's advice.

Have a great week.

The paper avalanche has begun.

sectorThe 22% Silver "Shortfall" in Mexican Production - Is it Real?#8675010/06/02; 19:08:29

Below is a review of GRUPPO MEXICO from its website:

The IMMSA Unit operates seven underground mining complexes located in central and northern Mexico. All of IMMSA's mining facilities employ State of the art mining technology and equipment. Each of IMMSA's seven principal mining complexes, as well as the Nueva Rosita Coal and Coke Complex, are describes in detail below.

The Charcas mining complex is located 110 kilometers north of the City of San Luis Potos' in the State of San Luis Potos' near our Zinc refinery. Access is provided by paved road. This complex includes an underground mine and two flotation plants. The mine produces zinc, lead and copper concentrates as well as significant amounts of silver. The Charcas district was discovered in 1573 and operations in the 20th century resumed in 1911. The unit is known for its low operating costs, good quality ores.

GMEXICO has expanded production of the mine by 30% in recent years and the Company believes that the Charcas mine is Mexico's largest producer of zinc.

The zinc and copper concentrates are treated at the San Luis Potos' zinc refinery and copper smelter.

Santa Bárbara
The Santa Bárbara mining complex is located 25 kilometers southwest of the City of Hidalgo del Parral in Southern Chihuahua. Access is provided by paved road. The unit includes three main underground mines and a flotation plant. The complex produces lead, copper and zinc concentrates with significant amounts of silver. Gold-bearing veins were discovered in the Santa Bárbara district as early as 1536. Mining activities in the 20th century resumed in 1913.

Lead concentrate produced at Santa Bárbara is sold in Mexico.The copper concentrates are treated at the San Luis Potos' copper smelter, and the zinc concentrates are either treated at the San Luis Potos' zinc refinery or exported.

San Mart'n
The San Mart'n mining complex is located in the municipality of Sombrerete in the western part of the State of Zacatecas, approximately 100 kilometers southeast of the City of Durango. Access is provided by paved road. This unit includes an underground mine and two flotation plants. The complex produces copper, lead and zinc concentrates, with significant amounts of silver. The mining district in which the San Mart'n mine is located was discovered in 1555. Mining operations in the 20th century resumed in 1949.

The copper concentrate is treated at the San Luis Potos' copper smelter and zinc concentrate is either treated at the San Luis Potos' zinc refinery or exported.

The Velarde--a mining complex is located in the North-Eastern part of the State of Durango, approximately 85 kilometers South-Southwest of the City of Torre--n in the State of Coahuila. Access is provided by paved road. The unit includes two underground mines and a flotation plant and produces lead and zinc concentrates. These mines were discovered in the 16th century and, with the exception of 1890 to 1920, reopened in 1980.

Lead concentrates are sold in Mexico. Zinc concentrate is either treated at the San Luis Potos' zinc refinery or exported.

Santa Eulalia

TThe Santa Eulalia mining complex is located in the municipality of Aquiles Serdán, in the central region of the State of Chihuahua, 25 kilometers East of the City of Chihuahua. Access is provided by paved road. This unit includes two underground mines and a flotation plant. The complex produces lead and zinc concentrates with significant amounts of silver. The mining district in which the Santa Eulalia mines are located was discovered in 1591 and mining activities in the 20th century resumed in 1918.

The lead concentrates are sold in Mexico. Zinc concentrate is either treated at the San Luis Potos' zinc refinery or exported.

The Rosario mining complex is located in the southeast of the State of Sinaloa, on the western side of the western Sierra Madre range 100 kilometers east of the seaport of Mazatlán. Access is provided by dirt road. The mine includes the Plomosas underground mine and a flotation plant and produces lead and zinc concentrates with significant amounts of gold and silver. The Rosario mines were discovered in the middle of the 16th century.

Lead concentrate is sold in Mexico, while the zinc concentrate is mainly exported.

The Taxco mining complex is located on the outskirts of the City of Taxco in the northern part of the State of Guerrero, approximately 70 kilometers from Cuernavaca. Access is provided by paved road. The unit includes several underground mines and a flotation plant. The complex produces lead and zinc concentrates, as well as some gold and silver. This mining district was discovered in 1531 and activities in the 20th century commenced in 1918.

Lead concentrates are sold in Mexico while zinc concentrates is either treated at the San Luis Potos' zinc refinery or exported.

Processing Operations

San Luis Potos' Zinc Refinery
The San Luis Potos' Electrolytic Zinc Refinery is located in the City of San Luis Potos', State of San Luis Potos'. Built in 1982, it is one of the most modem zinc refineries in the world utilizing state-of-the-art technology. The plant was designed to produce 100,000 metric tons of refined zinc per year by treating up to 185,000 metric tons of zinc concentrates from Medimsa's own mines. The refinery produces special high grade zinc (99.995% zinc), high grade zinc (over 99.900% zinc) and zinc-based alloys with aluminum. In addition the plant produces a number of by-products to include: sulfuric acid, refined cadmium, copper residues and lead-silver residues.

San Luis Potos' Copper Smelter
The San Luis Potos' copper smelter is adjacent to the San Luis Potos' Electrolytic zinc refinery. The plant, which has been in operation since 1925, has gone through several expansion and modernization phases, primarily over the last ten years. The facility operates with two blast furnaces (with a third one on stand-by), where incoming materials, mainly copper concentrates and copper by-products from lead plants, are smelted to produce a copper matte. The copper matte is then treated in one of the two Pierce Smith converters that produce an impure copper blister containing approximately 97.4% pure copper, one ounce of gold and 300 ounces of silver per metric ton.

Because the materials treated at the smelter contain various impurities (especially lead and arsenic), the facility has been equipped with an arsenic recovery plant for treatment of the dust produced in the blast furnace section.

Monterrey Refinery
The Monterrey refinery began operations in 1929 and is located in the downtown sector of Monterrey, in the State of Nuevo Le--n. Until 1993, the plant's principal activity was the refining of lead bullion. Medimsa closed the lead refinery in October 1993, following its decision to close its lead smelter in Chihuahua. The unit now processes electrolytic copper slimes containing gold and silver, which are received from two unaffiliated Mexican copper refineries that treat part of Medimsa's copper anode and copper blister production. The gold and silver contained in these materials is returned to Monterrey in the form of "tankhouse" slimes for treatment and recovery of the precious metals.

The precious metals refinery at Monterrey will remain in operation until completion of the precious metals refinery project at the Mexcobre unit is concluded .

Nueva Rosita Coal and Coke Complex

The Nueva Rosita coal and coke complex initiated operations in 1924. The complex is located in the State of Coahuila on the outskirts of the City of Nueva Rosita, near the Texas border. The complex is accessible by paved road. Nueva Rosita consists of an underground coal mine and a coke oven facility.

A "room and pillars" mining method is employed at the underground coal mines. These coke oven installations supply the San Luis Potos' copper smelter with low cost coke.

Operations of mining units and metallurgical plants
During 1998, the organization structure of underground mining operations was restructured in order to decentralize their performance and create two regional management groups. As a result, management is able to provide more direct supervision and better use of available resources. In addition, in most mining units, management developed a new and more ample program for development of mining activities so as to accelerate access to mine reserves and improve the operative flexibility.

During 1998, as part of the modernization and expansion program, the Santa Bárbara and Santa Eulalia units significantly increased production capacity; thus, milling increased from 4,800 to 6,000 and from 850 to 1,500 tons a day, respectively. In Nueva Rosita, a new Coal Washing Plant was put in operation with magnificent results in coal recoveries, increased quality of the product and lowered processing unit costs as well as the addition of volume for sale to third parties. Work for the conditioning of the Zinc Refinery at San Luis Potos' was continued in order to process concentrates of more diverse qualities and thus increase the metallurgical recoveries and volume of refined zinc.

This mining operation is the largest in Mexico and has very sophisticated equipment. Their mines are well established and the variance in production is small in the 1999 and Q1 2000 reports that are available at the url below.

The Quarterly silver production at GRUPPO MEXICO is roughly 4.17 million ounces of silver according to their Q1 2000 financial statement at the above url.

The Press release at the main url above shows that Mexico reported a 22% shortfall in silver mine production. There has been no pree to explain this clamatous "Shortfall" in production.

Oddly the later .pdf documents from GRUPPO are not available on their server.

Sierra MadreI guess I can't think straight anymore!!#8675110/06/02; 19:08:39

First thing that popped into my moth-eaten mind upon seeing that French tanker burning off Yemen, was:

"Was this meant to persuade the reluctant French into co-operation against Iraq?"

"You see, Frenchies, the Islamists are YOUR enemies too. So, don't give us a hard time about not attacking Iraq".


A sad mental degeneration where one can't call a spade a spade any longer: depends who is saying it's a spade.

We have a saying in Spanish: "Piensa mal y no errarás" -
"Think the worst and you will not miss."


HenriPaper Avalanche#8675210/06/02; 19:25:11

It would be interesting if JPM could no longer underwrite the sale paper gold if they lost their good credit rating.
BlackjackPort dispute hurts jobs#8675310/06/02; 19:28:18

LOS ANGELES (AP) - A second week of a West Coast port shutdown will cause a noticeable increase in plant closings, job losses and financial market turmoil, say analysts and business leaders who are increasingly skeptical of a quick end to the labor dispute.

Already, storage facilities at beef, pork and poultry processing facilities across the country are full, crammed with produce that

can't be exported. With nowhere to move their product, plant operators will begin shutting down Monday and layoffs will follow, said Mary Kay Thatcher, public policy director of the American Farm Bureau Federation.

In less than two weeks, if the shutdown continues, manufacturing plants will be grinding to a halt all over the country, farmers will be up in arms, and Asian equity and currency markets could face a full blown crisis, said Steven Cohen, a University of

California, Berkeley professor of regional planning.

"It's like draining a swamp. You start seeing all kinds of ugly creatures," he said.

The dispute is costing the U.S. economy as much as $2 billion a day, economists estimate.

Talks between the Pacific Maritime Association, which represents shipping lines and terminal operators, and the International

Longshore and Warehouse Union entered a fourth day Sunday. Negotiators were meeting in separate rooms in a hotel in San

Francisco's Chinatown, with a federal mediator shuttling between them.

"I think this will be a very long day, and a significant day," said PMA spokesman Steve Sugerman. He said the PMA would keep pushing for an extension of the old contract, which specifically forbid the kind of work slowdowns the PMA said prompted the shutdown Sept. 29. The union has refused, holding out for a new three-year contract that would give it control over any jobs that come with new technology.

Implementing labor-saving technology like electronic tracking devices puts only a small number of jobs at risk in the short term,

but future jobs are at stake, as well as control of the flow of information at the ports.

The PMA has always given the ILWU jurisdiction over new technology in the past, union negotiator Joseph Wenzl said Sunday. "The union feels we have offered a proposal that meets the employer in the middle," he said.

Both sides have agreed to resume shipping essential items to Alaska and Hawaii. They have also moved some cargo for the U.S. military, but there will be no more exceptions to the shutdown, Sugerman said.

The number of cargo vessels stranded at the docks or backing up at anchor points has risen to about 200 since the lockout, with dozens more still en route from Asia.

According to American Farm Bureau Federation figures, between 20 percent and 30 percent of all U.S. agriculture products are exported, and a third of that goes to the Pacific rim -- mostly through the West Coast ports.

A growing number of industry groups are calling for White House intervention, including use of the Taft-Hartley Act, which would force an 80-day cooling off period. President Bush hasn't said whether he would intervene.

Wenzl says the PMA's strategy is to encourage White House involvement to pressure the union, which has made the negotiations more difficult. "That's not collective bargaining," he said.

For Steve Dunn, founder and president of Munchkin Inc., an importer of infant goods, an end to the port shutdown can't come

soon enough. He already sent home nearly a fourth of his staff and expects to close down in two weeks if the ports aren't reopened.

The Van Nuys, Calif.-based company imports 95 percent of its goods from China, including infant utensils, spill-proof cups and rubber ducks. One-third of its inventory is stranded on the Pacific. Munchkin plans to use air freight this week to avoid

short-shipping key customers, but the cost is too high to continue for more than a few days, Dunn said.

Like many observers, he expects President Bush to refrain from ordering an end to the lockout until the crises worsens. "If there's more of a crisis, then he's more of a savior," Dunn said.

Dockworkers and their employers, meanwhile, have the financial resources to continue their five-month labor dispute, said Cohen, who studied the economic impact of a port closure for the shippers' association.

"Both sides can sit there absorbing punishments," he said. "They can easily take a month before they die. We can't."

Arcticfoxwow#8675410/06/02; 19:28:25

Nikkei down almost 400
Blackjack"No BANK too big to FAIL"#8675510/06/02; 19:40:13

TOKYO — No bank is too big to fail, Financial Services Minister Heizo Takenaka said in an interview with U.S. weekly magazine Newsweek, published Monday on the Internet.

"Big banks have their merits. They enjoy economies of scale...But we do not hold the idea that they are too big to fail," Takenaka, who is also economics minister, was quoted as saying. "That would jeopardize good corporate governance and create a moral hazard." (Kyodo News)
A BOAT packed with explosives has rammed and badly holed a French supertanker off Yemen, a week before the second anniversary of the terrorist attack on the US warship Cole, the French embassy has said.

"The oil tanker was rammed by a small boat stuffed with explosives" as it came by an offshore terminal in the Arabian Sea, vice consul Marcel Goncalves told AFP.

"It seems to be an attack in the same style as the USS Cole," he said of the hi-tech destroyer bombed by suspected al-Qaeda militants in Aden harbour on October 12, 2000. Seventeen US sailors died and 38 were wounded.

A gaping hole was blown into the side of the 330-metre-long tanker Limburg managed by the company France Shipmanagement, the embassy said.

"It is sinking, if it has not already sunk," Goncalves said of the tanker, located about 700km east of Aden.
Supertanker may have sunk! Thats expensive. Insurance rates
will go up.

BlackjackMizuho down 5%#8675610/06/02; 19:51:09

TOKYO, Oct 7 (Reuters) - Tokyo's Nikkei average fell four percent in late Monday morning trade, with banks and debt-ridden borrowers stumbling on growing fears that a tougher government line on bad loans could trigger a wave of corporate failures.
On the domestic front, nervous investors dumped shares in banks and troubled borrowers such as retailer Daiei Inc (Tokyo:8263.T - News), betting that the government would force banks to tighten the screws on ailing companies, eating into lenders' capital as they write off loans and trigger a wave of bankruptcies.

Mizuho Holdings (Tokyo:8305.T - News) fell 5.19 percent to 202,000 yen and UFJ Holdings (Tokyo:8307.T - News) slid 7.8 percent to 201,000, adding to a 32 percent loss last week.

Adding to fears about instability in the financial sector, top financial regulator Heizo Takenaka was quoted on Monday as saying that Japanese authorities do not believe major banks are too big to fail.

Daiei Inc (Tokyo:8263.T - News), which received a $4 billion bailout from its top three creditors in February, including UFJ, tumbled 24.8 percent to 94 yen, and was the biggest percentage loser on the Tokyo Stock Exchange.

Daiei's fall added to a 32 percent loss last week.
Japanese housewives might be lugging home more Gold this week.

kasperjack No Banks Too Big To Fail;Document#8675710/06/02; 20:00:47

Dow Jones Business News
Japan Takenaka: No Bank "Too Big To Fail" -
Sunday October 6, 9:14 pm ET

TOKYO -(Dow Jones)- Japan's new banking minister reiterated he's determined
to flush the banking system of bad loans, adding he doesn't believe there are
banks that are "too big to fail," Newsweek reported on its web-site Monday.
Like I said before the real target is the trillions of yen held by the the Japanese savers. The Taxpayers will probably prop up the core of the keiritsu.

Black BladeChartists: Stocks to Drop Further in Fall #8675810/06/02; 20:10:35


NEW YORK (Reuters) - U.S. stocks have just ended the quarter with their biggest losses since the 1987 stock market crash but the worst is yet to come, say technical analysts who chart stock movements, trading volume and market sentiment. Even though stocks continue to plumb multi-year lows, the market hasn't seen the kind of "wholesale" dumping of stocks they say it needed to wash out the remaining excesses from the late 1990s bubble. Investors should stay on the sideline," said Mark Arbeter, Standard & Poor's chief technical analyst. "I wouldn't recommend people buy any stocks at this time."

Black Blade: The fundamentals look ugly too! Looks ugly for tomorrow unless some rescue attempt is made from the official sector in combo with the investment houses. In a word – "Grim".

Black BladeWall St Week Ahead - Sellers likely to keep upper hand #8675910/06/02; 20:22:36


NEW YORK, Oct 6 (Reuters) - Investors are likely to become even better acquainted with the term "new multiyear low" in this week as the lows from the 1990s scraped recently are expected to be the starting point for further declines. Sellers will keep the upper hand as the third-quarter reporting season begins in earnest and the markets wait for major economic reports on the September producer price index and retail sales. "We know that this (third) quarter's blown," said Martin Yokosawa, portfolio manager with Oberweis Asset Management, which oversees $200 million. "We're very interested in management's forward comments. Is the visibility going to improve?" The jittery stock market will also be faced with President Bush's nationally televised speech on Iraq set for Monday night and the impact of the West Coast ports labor dispute. Prolonging guesswork for the market, the major economic reports will not arrive until Friday. "It's hard to find any good news," Michael Vogelzang, president of Boston Advisors Inc., said. "There's very little that anyone wants to own here."

Black Blade: The conditions are very ripe for a revisit of the Great Depression. Stocks are still grossly overvalued and have a long ways to fall until they fall in line with historical valuations. Also the dockworker-shipping talks are getting nowhere and the effects are rippling through the economy faster than expected. I hear that meats and produce are rotting on the docks and on board ships and industries reliant on "just-in-time" inventories are starting to close down and are laying off workers. BTW, Merrill Lynch and JP Morgan Chase are expected to lay off thousands of "nonessential" workers – so far no comment from either Lynch or JPMC.

goldspecattack on french oil tanker#8676010/06/02; 20:25:51

how convenient that a French owned vessel gets attacked when France is undecided with their security council vote on whether to attack Iraq.
GenooLula#8676110/06/02; 20:35:49,&s2=ad_right1_windex&tp=ad_topright_topworld&refer=topworld&

Lula gets 47% with half of the Brazilian vote counted. Officials expect a runoff vote in three weeks. Lula wins either today or in three weeks. Either way another wild card will be added.
cyberbatDay of Reckonong is here#8676210/06/02; 21:02:23

I've been reading about the troubles in Germany with their banks today. Also been watching the japanese banks bracing for new banking laws as their stock market crumbles to a 19 year low. Just read about an emergency meeting by the fed this week. Thinking about all the banking troubles in South America.Scared half silly about what I don't know, that is going on behind the scenes as we huddle at the castle.
I see a frighting dark cloud arising either tomorrow or later in the week. I am ready, but I'm really scared. Something is about to break! I feel it in my bones! I see much human suffering for those that are not pepared.
Dear God be with us all for this time it's going to be world wide. All the super computers are maxed out now and can no longer stave off the wanton tide that is about to engulf us. Grab hold dear friends; it's going to be an agonizing ride thru the throes of terror.
Just had to get it off my chest. Too hard to hold in now. Good luck to all---

Black BladeMerrill, JP Morgan May Cut More #8676310/06/02; 21:12:26


NEW YORK (Reuters) - Merrill Lynch (MER) and J.P. Morgan Chase & Co (JPM), two of the world's top investment banks, faced with diminished merger and underwriting work, are preparing to cut thousands more jobs, sources familiar with the companies said on Sunday. As Wall Street's losses deepen, the cuts would be the latest for the global investment banking sector, which is already estimated to have shed some 60,000 jobs since the start of 2001. Banking industry sources said J.P. Morgan, the second largest U.S. banking firm, could cut as many as 3,000 workers. On Sept. 17, J.P. Morgan warned that its third-quarter earnings would be well below their second-quarter level due to weak trading results and bad loans to telecommunications and cable firms.

Black Blade: Actually the number I hear is that JPMC will fire 4,000 more "Bones" and that CEO William Harrison will likely be handed a golden parachute just to bow out. Also, both companies will likely experience some heavy losses from investment operations next quarter. It looks like a lot of assumptions about plans made by JPMC are coming unraveled. The rumor is that Morgan Stanley looks to be in serious trouble too. It is beginning to look very ugly.

Black BladeGlobal crash fears as German bank sinks #8676410/06/02; 21:20:46,1598,805683,00.html


Stockbrokers around the world are braced for a potentially calamitous week as alarm mounts over a looming, Thirties-style global financial crisis. A leaked email about the credit-worthiness of Commerzbank, Germany's third largest bank, yesterday increased fears of the international stock market malaise exploding into a fully-fledged banking crisis. Commerzbank lost a quarter of its value last week, raising the spectre of Credit-anstalt, the Austrian bank that collapsed in 1931, sparking global depression.

US stock markets have fallen for six consecutive weeks, to their lowest levels in five years. European markets have collapsed even further, wiping out nearly half of the value of European corpora tions in this year alone. Japan is struggling to put together a plan to save its banking system, riddled with bad debt after a decade of recession and falling prices. Now the German economy threatens to follow. 'There are strong parallels to the Thirties after an unsustainable "new era" boom,' says Avinash Persaud managing director for economics and research at State Street Bank. 'Then, the stock market decline was not just steep, it was long, taking three years to reach the bottom.'

Black Blade: As I have been saying – "welcome to the New Great Depression"! There is no way that we are going to have a "second half recovery" as the trolls and pimps on Wall Street have been saying for the last three years! Corporations and consumers are drowning in record levels of debt and they continue to dig themselves deeper daily. Many companies are selling off pieces in a desperate bid to dig themselves out but it isn't working. Meanwhile debt rating agencies are busy downgrading debt. "Interesting Times"

Black BladeMerrill e-mail sparks European bank fears #8676510/06/02; 21:27:16


A damaging seven-line e-mail from Merrill Lynch, the investment bank, on Friday stoked fears of financial difficulties at Commerzbank, one of Europe's largest banks. The e-mail added to the market's already heightened sense of anxiety about the health of Europe's banking sector, with analysts anxious about the stress levels in the financial system. "Again the market is flooded with rumours that Commerzbank, amongst all its other problems, has sustained large trading losses in credit derivatives," wrote Maria Anastase, a member of Merrill's corporate credit department. The e-mail was sent to the Standard & Poor's credit rating agency, with Merrill asking for a comment "as to the validity of this and the likely impact to the bank's health". It went on: "Apparently, a number of banks have begun to shut down credit lines." It is not known how, or whether, S&P replied to the e-mail.

Black Blade: It will get much worse as several other banks are in trouble as I have outlined in the past. It is only a matter of time now as more news continues to leak out about the viability of the global banking system. Very "Interesting Times" indeed.

BoxmanSurprise Fed Meeting#8676610/06/02; 21:55:03


Advance Notice of a Portion of a Meeting
under Expedited Procedures
It is anticipated that a portion of the closed meeting of the Board of Governors of the Federal Reserve System on Monday, October 7, 2002, will be held under expedited procedures, as set forth in section 26lb.7 of the Board's Rules Regarding Public Observation of Meetings, at the Board's offices at 20th Street and C Streets, N.W., Washington, D.C. The following items of official Board business are tentatively scheduled to be considered at that meeting.

Meeting date: October 7, 2002

Matters to be Considered:
1. Review and determination by the Board of Governors of the rates of discount to be charged by the Federal Reserve Banks.

Boxman: Looks like there are going to be a lot of people starting this work week off without a good nights sleep. Got NoDoz?

BoxmanSurprise Fed Meeting#8676710/06/02; 21:55:04


Advance Notice of a Portion of a Meeting
under Expedited Procedures
It is anticipated that a portion of the closed meeting of the Board of Governors of the Federal Reserve System on Monday, October 7, 2002, will be held under expedited procedures, as set forth in section 26lb.7 of the Board's Rules Regarding Public Observation of Meetings, at the Board's offices at 20th Street and C Streets, N.W., Washington, D.C. The following items of official Board business are tentatively scheduled to be considered at that meeting.

Meeting date: October 7, 2002

Matters to be Considered:
1. Review and determination by the Board of Governors of the rates of discount to be charged by the Federal Reserve Banks.

Boxman: Looks like there are going to be a lot of people starting this work week off without a good nights sleep. Got NoDoz?

PH in LAWhat's really behind the talk of war with Iraq#8676810/06/02; 22:00:39

"it would be naive and dangerous to reject the role that history has thrust upon us. Kagan, for example, willingly embraces the idea that the United States would establish permanent military bases in a post-war Iraq. "I think that's highly possible," he says. "We will probably need a major concentration of forces in the Middle East over a long period of time. That will come at a price, but think of the price of not having it. When we have economic problems, it's been caused by disruptions in our oil supply. If we have a force in Iraq, there will be no disruption in oil supplies."

"... The lure of empire is ancient and powerful, and over the millennia it has driven men to commit terrible crimes on its behalf. But with the end of the Cold War and the disappearance of the Soviet Union, a global empire was essentially laid at the feet of the United States. To the chagrin of some, we did not seize it at the time, in large part because the American people have never been comfortable with themselves as a New Rome. Now, more than a decade later, the events of Sept. 11 have given those advocates of empire a new opportunity to press their case with a new president. So in debating whether to invade Iraq, we are really debating the role that the United States will play in the years and decades to come.

Nibelungturning of the screw#8676910/06/02; 22:26:18

Slowly, but relentlessly, the screw turns. The banks move ever closer to the edge. The range of policy options gets ever smaller. A new infusion of cheap oil into the economic zombie might keep the "undead" system animated for a while.

But that is a high stakes operation. If it goes awry (scorched-earth response, China enters the game, etc.) and oil is cut off, the econozombie will lurch forthwith into the abyss.

Maybe JMP, et. al. have big oil future positions that they hope will save them.



October 6, 2002 -- Attention investors heaving a sigh of relief that the corporate earnings recession appears to have ended. A new twister is about to be unleashed. This tempest is the result of dramatically lower funding of corporate pension plans following the stock market's plunge. After using overfunding of the plans to enhance profits, companies have lost their earnings catalyst and are racking up billions in liabilities. "This is going to be an extremely hot topic," said Howard Silverblatt, editor of quantitative services at Standard & Poor's. "The fat is about gone. These companies have to start putting in hard cash." "I'm anticipating that the data for the end of 2002 are going to be atrocious," said actuary Adrien LaBombarde of Milliman USA, a pension consulting firm. Merrill, in a research report by analysts Adrian Redlich and Rebecca Skilbeck, warned that analysts likely will downgrade earnings estimates for 2003 because of pension liabilities and said some companies could be headed for a cash crunch. "You're talking about enormous amounts of money that have to be paid," said Silverblatt. "That cash has to come from somewhere." Equally disturbing is the impact on companies' loan covenants with banks, noted Robert Willens, a tax and accounting analyst at Lehman Brothers. Some companies may violate loan terms and be forced back to the bargaining table with lenders, he said.

Black Blade: Hear that sizzling sound? It's the sound of retirements vaporizing into nothing. After the American public watched as deer caught in the headlights, that $8 trillion worth of retirement dreams are just the beginning. It appears that several $trillion more of wealth will be vaporized, this time as corporations sink more cash into pension plans that were looted and plundered over the last few years. This will have to come out of corporate earnings – real earnings – cold hard cash – not the wild hallucinations of phoney pro forma or operating earnings, but the real thing. "Check Mate!"

BlackjackFull speed ahead, damn the torpedoes#8677110/06/02; 22:54:57

Koizumi - Govt to push on with bad-debt disposal plan despite equity falls

TOKYO (AFX-ASIA) - Prime Minister Junichiro Koizumi said the government will push forward with plans for accelerated bad-debt disposals, even after recent sharp declines in share prices.

Koizumi added that he does not at present plan to consider implementation of a supplementary budget to offset the negative impact of the disposals.

"We will keep accelerating bank bad-loan disposals," he said when asked about the impact on share prices of comments by government officials on bad-loan disposals.

"The stock-price declines are reflecting the US equity declines. We will proceed with structural forms," he said, adding that the government does not yet plan to launch an extra budget to offset the economic impact of reform.

"I'm not considering, at present, a supplementary budget," Koizumi said.

Chief Cabinet Secretary Yasuo Fukuda said this morning that the government may consider additional spending.

"The government is, at present, continuing with its existing policy but we will consider the necessity of an extra budget in the future in the context of reasonable things," Fukuda said.
They will not prop the Nikkei?
Got Gold?

GaleriderJAPAN#8677210/06/02; 22:56:55

Your postings on the falling companies here. Daei...the big department store chain...well, went over to the one next to where I work today and five stores that rent space in the mall were closed down....I mean boarded up!
Black BladeOil Prices Poised to Rise After Attack on Tanker in Yemen#8677310/06/02; 22:58:58


New York, Oct. 6 (Bloomberg) -- Crude Oil prices may rise this week after a French tanker was damaged by an explosion in Yemen, renewing concern that terrorists might disrupt shipping in the Middle East. The ship was struck by a boat packed with explosives, a French diplomat in Yemen told Agence France-Presse. Officials in Yemen said the explosion was an accident. Producers in the Middle East pump about a third of the world's oil. ``You might get a `fear premium' built into prices,'' said Phil Flynn, a senior energy trader at Alaron Trading Corp. in Chicago. ``The big fear is, is this the future when it comes to terrorism?'' ``This is a very serious development,'' said Alain le Chevalier, head of Middle East operations for Total Fina Elf SA, France's biggest oil company. ``The same thing could happen inside the Persian Gulf. Oil tankers are very, very easy targets.'' ``This will have an impact'' on oil prices, said Jurjen Lunshof, an analyst at Barnard Jacobs Mellet in London. ``Anything like this just increases tensions.'' ``It seems to be an attack in the same style as the USS Cole,'' French Vice Consul Marcel Goncalves told the news agency. The U.S. has blamed that attack on Osama bin Laden's al-Qaeda network.

Black Blade: An earlier report has the captain of the tanker saying that a small boat had approached the ship although Yemeni officials are trying to spin the story of an accident. It appears that al Qaeda is back in business. Of course an attack at the Saudi off loading terminal would have been more effective as the chock point for oil exports at the terminal is where 5 million bbl/day are loaded onto tankers.

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Black BladeAsian Markets Get Slaughtered#8677510/06/02; 23:07:45

Both the Nikkei 225 and Hang Seng are solidly below 9,000 and the Taiwan Weighted is sub 4,000. This is one ugly trading session in Asia as the banking sector appears to be on the verge of collapse and companies are reporting losses. It should be interesting to see how Euro markets react especially in light of the possible collapse of Commerzbank. "Interesting Times"

- Black Blade

Black BladeMarket Indicators#8677610/06/02; 23:14:56

The US market index futures are negative, the USD is positive, gold is positive, oil is knocking on $30/bbl again, and NatGas is sinking hard (hmmm...). Looks like a rough start on Wall Street if this keeps up.

- Black Blade

BlackjackGerman economy tanking?#8677710/06/02; 23:26:00

Frankfurt, Oct. 7 (Bloomberg) -- German factory orders probably fell for a third month in August, evidence a recovery in Europe's largest economy is stalling.

Orders probably declined 0.5 percent in the month and 1.1 percent from a year ago, according to economists surveyed by Bloomberg News. They fell 0.4 percent in July.

Companies are scaling back earnings estimates and shedding jobs as a rebound falters in the U.S., which buys about a tenth of German exports. Other reports next week may show German unemployment rose in September and industrial production fell the previous month.

``There is no recovery in Germany without a U.S. recovery,'' said Joerg Lueschow, an economist at Westdeutsche Landesbank Girozentrale in Dusseldorf. ``In the most extreme case, Germany may slip back into recession.''
No recovery here. Get ready for the "extreme case".

BlackjackJapan headed for negative growth#8677810/06/02; 23:48:32

Tokyo, Oct. 7 (Bloomberg) -- Japan's index of leading economic indicators fell to a level that predicts the world's second-largest economy will shrink as soon as November, cutting short a recovery from the third recession in a decade.

The leading index -- which includes job offers, machinery orders and other measures of future activity -- dropped to 44.4 percent in August from 70 percent in July. It fell below the 50 percent level for the first time in eight months, indicating a contraction in three to six months.

Exports, which accounted for half of Japan's 0.6 percent economic growth in the second quarter, fell for a third month in August as U.S. demand slowed. That's prompting Japanese manufacturers to curb investment in factories and equipment, crimping economic growth.

``We're nearing a turning point in the economy as exports are beginning to wane with a slowdown in the U.S.'' said Minako Iida, an economist at Deutsche Securities Ltd. ``There's nothing that can support the economy once exports stop growing.''

Growth in the U.S., the biggest overseas market for Japanese goods from Honda Motor Co. cars to Nintendo Co. video games, is sputtering. Growth slowed to an annual pace of 1.3 percent in the second quarter from 5 percent in the first. A strike at U.S. West Coast ports may hurt Japanese exports more.

A shrinking economy may make it more difficult for Prime Minister Junichiro Koizumi to push through plans to clean up about $430 billion in banks' bad loans, analysts said. Writing off debts could push more companies into bankruptcy, swelling near-record unemployment.

``The main focus now is whether the government will use public funds to bail out banks, and how fast they will push the bad loan write-offs,'' said Masaki Kuwahara, an economist at Nomura Research Institute.
Economic contraction = recession

TownCrierGlobal lessons: Risks abound for corporations and cash... bankruptcy vs. super-easy money and depreciation#8677910/7/02; 00:32:48

TOKYO, Oct 7 (Reuters) - Tokyo stocks crumbled on Monday to a fresh 19-year low, led by banks and their debt-ridden borrowers on fears that a tougher stance on bad loans would trigger a violent wave of corporate failures that could ripple through the economy.

The benchmark Nikkei 225-stock average was down 3.46 percent at 8,715.59 by the midday break...

On Monday nervous investors continued to dump shares in banks and troubled borrowers, betting that the government would force banks to tighten the screws on ailing companies.

That could eat into lenders' capital as they write off non-performing loans, and trigger a wave of bankruptcies, increasing the deflationary pressures weighing on growth in the world's second-largest economy.

"The fear is that we are heading for an 'all pain, no gain' scenario. We need complementary policies like bold tax cuts to ease the pain," said Koichi Ogawa, chief portfolio manager.

Traders said that the Nikkei was likely to find solid support at around 8,500, the point at which latent losses on the massive shareholdings of Japan's banks are seen pushing capital adequacy ratios below healthy levels at some weaker lenders.

Any fall below that point would likely trigger a government response, such as buying by public pension funds, traders said.

Adding to fears about instability in the financial sector, top financial regulator Heizo Takenaka was quoted on Monday as saying that Japanese authorities do not believe major banks are too big to fail.

-------(url for full text)------

Bottom line: that last line ought to propel the gold-buying movement in Japan. Ultimately, cash is trash as governments will through policy adjustments foster a depreciation of the currency as the smoothest way to widely socialize the losses involved in the workout of an economic bust. Meddling with the business cycle to allow for privatized gains but socialized losses is, after all, the prevailing passtime of governments everywhere.

Don't put your eggs in a rotten basket... the handle may break or the bottom may fall out. Buy gold and leave the losses to others -- its not your obligation to go down with the ship.


Belgian@ Goldspec#8678010/7/02; 00:47:54

Small corrective detail on the nationality of the Yemen oiltanker story: It is a Belgian owned ship, not French ! CMB = Compagnie Maritime Belge. I'm not attaching much importance to this particular, convenient, mistake. Most important is, that it was "oil" that was targetted. Regards to you Sir.
Black BladePawnshops Benefit in Economic Hard Times#8678110/7/02; 00:53:50


Oct. 6--Not all businesses are groaning about the economic downturn. The story of gloom has a flip side -- it's a tale of a boom. Some businesses are thriving like never before. Pawnshop operators are seeing an increase in foot traffic. Bankruptcy lawyers are swamped with calls. Buyout firms are picking their way through the corporate carnage, looking for bargains. Restructuring finance providers are busy arranging for loans either to help companies through a bankruptcy process or infuse them with new life. Distressed-debt traders are swooping in to snap up troubled debts at deep discounts. It's a law of nature that is reasserting itself in this economy: One sector's distress is another sector's gain.

Black Blade: A dark cloud with a silver lining? A long but interesting article with examples of people trying to get by during this deepening recession. In a word – "Grim"

Black BladeCommodity volatility's coming#8678210/7/02; 01:05:01{5FCDEFD5-D2F8-4F17-81E9-B64F38EB0480}


TORONTO -- Strong increases in the cost of energy and agricultural goods boosted overall commodity prices by 5.4 per cent last month but a broad revival "will likely have to wait until there are signs of stronger economic expansion," Bank of Montreal economists say. "We expect that commodity prices will likely be volatile during the next few months," commented BMO economist Earl Sweet. Oil and natural-gas prices rose 14.3 per cent in the second consecutive large monthly gain, amid indications of declining U.S. gas production and worries about oil disruptions. "With global inventories of grains low relative to consumption and tight supplies of edible oils, grain and oilseed, prices should remain firm in 2003." The BMO's metal and mineral index edged up 0.8 per cent, pushed higher by gold as investors sought safe havens. Base-metal prices remained soft "and will not likely break to the upside until there are firm signs of stronger economic growth globally."

Black Blade: Like a drowning man going down for the third time – no "second half recovery" this time either. Don't forget the crippling drought in the US, Canada, Australia, and Asia either as crops wither and die. As I always say: get out of debt (and stay out of debt), stash enough cash for several months expenses, accumulate Gold and Silver portfolio insurance, and start a storage program of nonperishable food and basic necessities.

Black BladeEuro Markets in Free Fall#8678310/7/02; 01:23:31

What can I say except - "Grim"

- Black Blade

Black BladeU.S. West Coast Port Talks Break Off #8678410/7/02; 01:30:49


SAN FRANCISCO (Reuters) - Negotiations aimed at ending a week-long management lockout of U.S. West Coast ports broke off without agreement late on Sunday and there was no schedule for resuming them, a federal mediator said. "No agreement," Peter Hurtgen, director of the Federal Mediation and Conciliation Service, said after four days of talks between port operators and union longshoremen in San Francisco. The negotiations between the Pacific Maritime Association, representing employers at 29 West Coast ports, and the International Longshore and Warehouse Union have been closely watched as fears mount that the port lockout may do serious damage to the faltering U.S. economy.

Black Blade: The US economy is toast even without this lockout. However, this will only serve to expedite the inevitable.

Black Blade"Barbarous Relic Files" - Tampa marine explorers to salvage gold-laden ship #8678510/7/02; 01:44:43


TAMPA, Fla. - A salvage company struck a 20-year deal with Britain to search for riches in the sunken warship HMS Sussex, which went down in 1694 laden with gold and silver. The Sussex, which sank off Gibraltar in the Mediterranean Sea, might be the richest shipwreck ever, with experts estimating a treasure potentially worth $4 billion.

Black Blade: The UK needs more gold to auction do they? Hmmm…

Black BladeJapan markets fret as hard landing looms for banks #8678610/07/02; 01:58:36


TOKYO, Oct 7 (Reuters) - An air of panic swept Japan's financial markets on Monday as investors, fearing mass bankruptcies under Prime Minister Junichiro Koizumi's bank reform plans, hammered Tokyo stocks to a 19-year low and sold the yen. The parlous state of Japan's economy was driven home again when the Cabinet Office said its leading indicator of economic conditions came in below the boom-or-bust reading of 50 percent in August for the first time in eight months, suggesting a tentative export-led economic recovery was losing steam. "Investors are scared of the impact of rising bankruptcies," said Koichi Seki, equity manager at Chuo Securities.

Black Blade: I would say that's a fair assessment. But it's too late to save Japan's economy anyway. Since this is an export driven economy, they have an additional threat in the form of a west coast lockout during a time of weak US buying of exports.

Black BladeMaersk, 11 other ship lines halt US bookings from HK #8678710/07/02; 02:05:42


HONG KONG, Oct 7 (Reuters) - About a dozen shipping lines, including Maersk Sealand, the world's biggest container line, have stopped accepting bookings for goods from Hong Kong to the U.S. West Coast because of a lengthening ports dispute, shipping officials said on Monday. Maersk Sealand said on its Hong Kong Web site that it had suspended acceptance of all bookings and stopped services to the U.S. West Coast from last Thursday. "There are fears that ships will not be able to return as they may be stuck on the West Coast," said Jim Poon, the chairman of Hong Kong Liner Shipping Association. He said about a dozen companies had stopped accepting bookings.

Black Blade: It is said that talks between the workers and shipping company have broken off "indefinitely".

Black BladeJapan in critical state if Nikkei below 8,000-Okuda #8678810/07/02; 02:14:03


TOKYO, Oct 7 (Reuters) - The chairman of Japan's biggest business lobby said on Monday that the Japanese economy would be in a critical situation if the Nikkei stock average fell well under 8,000.

Black Blade: I got news for Okuda – Japan is already in a critical state.

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Black BladeThe vendetta of gold#8679010/07/02; 02:59:11


Despite the machinations of world governments, the yellow metal will re-emerge as the monetary standard of the 21st century, predicts Sonaal Kohli

"Inflation and treasury bill went up the hill,
To fetch food, housing and water,
Purchasing Power fell down, broke became "The Crown",
And economy came tumbling after."

The recent rise in price of gold despite all-out efforts by the governments of the world to suppress it remains an enigma. The rise of gold challenges the source of government's unlimited power to print unlimited money. It reflects people's lack of faith and a vote of no confidence to the government's inflationary monetary policies. Premature obituaries of gold by magazines like The Economist, which called it "A spent fuel of an obsolete monetary system", reminds one of Mark Twain's words: "The news of my death is greatly exaggerated.

Black Blade: Nice article. Preaches to the choir.

slingshotBlack Blade#8679110/07/02; 03:01:50

And Others at the Forum

Ladies And Knights at The Table Round.

You have no idea how much information exchanged here the general public has no idea of. In the past few days I have been able to access USAGOLD at work and some of my co- workers have noticed me at the computer. They ask me what am I looking at and when I tell them precious metal investment , they run like the dicken's. You would think I was going to Rip their arms off! I wish they would just read some of Black Blades post. That's all. But they avoid it like the plague.

All I can say is that soon it will be time to HUNKER DOWN!

45 SouthCanadian Dollar#8679210/07/02; 03:35:52

Governor of the Bank of Canada David Dodge said ,Canadian adoption of the US dollar may not be far off,according to paper today( This may be old news to you good folks )I suppose New Zealand will eventually tie in with the Aussie dollar'sooner than later and the next logical step would most likely be the same.(Would make it easier for me to work out the NZ$ price for gold!!)
slingshot45 South#8679310/7/02; 03:50:18

First time Post?

How are things Downunder? NZ, Hmmmmm

Cage RattlerCanadian Dollar#8679410/7/02; 04:11:18

Amazing how different newspapers give different slants on what he said. This is what the Globe and Mail reported: "For now, and as far into the future as I can see, the floating exchange rate is the best choice for Canada given the degree of integration of the Canadian and U.S. markets for goods and services and labour," Mr. Dodge told the Quebec Chamber of Commerce in Sherbrooke, Que.
TopazThe opposite of DEflation is......?#8679510/7/02; 04:16:24

Those who have been following the Bond yield saga will know and attest to the fact that the 30 Yr Treasury yield has been in decline for over a decade - right through the Tech bubble, new Paradigm etc. Now, as we slide into recession, the rate of decline has increased dramatically...with the 5 and 10 Yr in lockstep.
This "laymans guide to INflation" has been telling us that, for the past several Yr's, we've been in a DISinflationary cycle and the current economic climate portends more of the same.
So, as we approach the point where the T-Bond yields equate to 0% CASH ie: NO valid reason to hold 5-10-or 30 Yr paper, can the more astute than I posters offer a scenario for this Market from here on out?

We haven't been here for 40 odd Yr's....and now with a full blown Fiat World Reserve Currency to boot.

BelgianThe Price of Gold#8679610/7/02; 05:44:28

POG remains VERY stable, unmoved and unemotional ! So does the euro/dollar exchange rate. Both currencies seem to have agreed on a temporary, shortlived, armistice. Bush's speech tonight, might (!) change this currency-peace ?
The US$, reserve currency, is further allowed to "BUY" its way further into the geopolitical morasses. All co-operation with the US on this globe is been bought with the dollar-manna, directly or indirectly. "With us" and dollars will flow abundant. "Against us" and we (the dollarblock) isolate you back into the stone-age.
This is what the mighty dollar stands for ! Yes, indeed, NWO, ambitions.

But this NWO (explicit by dad Bush) faces the impossible unwinding of a gigantic financial over-valuation. Simply said a SP-500 - P/E = 30 and almost zero % IRs. The NWO-colluders want to get the world economy to grow, again, as fast as possible, as to justify those P/E=30 and get on with their impulses/ambitions. But they created a, nasty, backfiring, Osama bin Laden counter-current. Things are not running according to plan A > B > C...
Arabian cheap oil AND islamism, can't be bought for strong dollars, that easely, anymore. The consequential isolation to the stone age, remains as only alternative. All possibilities for any compromise seem to evaporate. All that's left is radical confrontation. Everybody is *positioning* for this very likely, ugly, outcome. Euroland, China, Russia and the entire Middle East are walking on eggs.

Yes, dear forumers, we had turbulent episodes, WITH EXTREMES, before. But the whole world has changed and is in the process of changing more dramatically on many different fields. Globalization and the emergence of vast well defined power-blocks, is the main difference from the previous episodes. What is more frightening : permanent and unlimited terror or nuclear deterrent ? Both, terror and nuclear force, need to be approached in a total different way. That is exactly the wrong conclusion that is taken, these days. Terror can be neutralized with declining confrontation, whilst nuclear deterrent was a pure (insane)arms race.

This polarizing world will land on a Gold-dispute, amongst many other, fundamental, differences in opinion. Geopolitical polarization and economical/monetary, polarization go hand in hand. We will surely not "all" agree on the present geopolitics as we will not "all" agree, permanently, on global Gold-politics versus monetary policies . What is good for the dollar block will decreasingly be good for other blocks. That's the idea, I wanted to suggest to the forum. What's wrong with it ? TIA.

misetichEurostocks Slammed as Banks Slide#8679710/7/02; 05:58:43


Banking group Credit Suisse sank 8 percent, extending its 25 percent slide in the past two trading days as investors feared BZ Group, a key shareholder, would offload its stake
Shares in Germany's Commerzbank dropped 7.2 percent as the bank denied it was facing financial difficulties and the Financial Times reported the bank was set to slash more jobs.

Among other banking and financial shares in the spotlight, Deutsche Bank fell four percent, Germany's HVB dropped 6.7 percent, and Dutch ABN AMRO was off 6.1 percent. France's Societe Generale shed 6.3 percent.
Two leading U.S. investment banks, Merrill Lynch and J.P. Morgan Chase & Co are set to cut thousands more jobs, sources familiar with the companies told Reuters Sunday.


There is nothing better than the smell of banking roast in the oven

Ding..ding - dinner is almost ready - served on a gold plate

Got gold?

slingshotComment#8679810/7/02; 06:08:43

Tough Times Ahead

I read so much at this forum and I can tell you that I have not waivered since the beginning, in my thought process to accumulate GOLD. We look at others when we explained just exactly where the FIAT system is going and their determiation to go the long haul is something that I just can not understand. Yet there is something a blind man can see even without all the charts and TA can muster. It may be that Hoosier Goldbug may get his wish to accumulate for a thousand years, but I doubt it. The sense of denial is strong but not unbreakable. I await the opening of the markets like a shark. I have no fear. I have nothing in the markets. My investments solid in PM's. I have taken the advise of Black Blade. I have done this of my own accord.
Yes, I take respondsibility for my actions. Hold noone respondsible but myself. All should be able to read between the lines at what I just written. I am not a financial advisor or broker or anything of the type. Just an enlighten Joe Sixpack. No degree of anykind except in the School of Hard Knocks. Oh, Taurusfeceology, I forgot:0) I believe Darkhorse requested that we posts news about coin and bullion dealers in your local area. Little response.

To those sporadic posters and Lurkers.

I can tell you that the Sages at this forum read every post.

They have been very kind to me. Hint: If your read their posts they, at times will refer to you covertly.

In closing Ladies and Gentlemen.

We must close ranks! In One hour or two we may see our future! As for the markets? Fix Bayonets. CHARGE!


misetichJ. P. Morgan Chase Plans Big Job Cuts#8679910/7/02; 06:09:11


J. P. Morgan Chase is planning to cut as many as 4,000 employees, including many managing directors, from its investment banking operation over the next several weeks, executives with the firm said yesterday.
The bank said that write-offs and additional reserves against potential losses on loans to companies would rise to $1.4 billion in the third quarter. That would be a sharp increase from $302 million in the second quarter. It said it had trading revenue of $100 million in July and August, compared with $1.1 billion for the full previous quarter.

Thanksgiving is just around the corner - time to feast on this well done turkey

Got gold?

Paper AvalancheSurprise Fed Rate Cut Today????#8680010/7/02; 06:12:04

I just saw this on yahoo.



Belgian@ Topaz : We haven't been here for the last 40 years !#8680110/7/02; 06:43:08

My 0,2 cts on "where from here" ?
IRs will stay or evolve, where the US$/euro/Yen currencies, want them to stay, evolve.
Sir Topaz, there is a "currency war" raging out there ! A war on life or death, not an ordinary streetfight or neighbour dispute...but a fierce fight for supremacy, survival and dominance. This within the context of a global economical drame to come.
Let us simply observe how long those IRs will hover around their ground zero. Let's wait and see, wich currency makes what move and find out what is politically decided on the currency's fate of purchasing power and exchange rate.
It is a pure "political" play and forget about the strict theoretical, economical, arguments. IRs, Gold and now more than ever, POO are currency-political related.

IMVHO , we cannot dream about a progressive, controlled rise on IRs in the future. Or IRs will explode, or the purchasing power AND exchange rate of the currencies will change dramatically. Something has to give in, this time, really big. Remember the 1980 IRs ATHs ! Rember the enormous dollar fluctuation between 1985 and 1995 ! Today we are in the final and decisive episode of those wild runs.

Normal IRs with a total other currency picture or super high IRs with the same currency picture ? Staying around the zero level is simply a matter of postponing the final and inevitable political decision (critical mass offf it) to change monetary business, dramatically.

Please note that through Al Jazeera, OBL, is supposed to have given sign of life with the statement that : The US economic system is the target !? It is a good thing to know that one knows where his Achillesheel lies.
Hyperinflation = A currency unmasked and showing its real purchasing power or IRs super high as to compensate for this loss in purchasing power (devaluation). Or a brand new currency on a 10 to 1 basis or something like that ?
100 old US$ per barril (20 % IR) or 10$ new US$ (2%) for the same barril ? Or 10 € per barril and 1€=10$ ?

A prolonged period of zero IRs is a drama for the growing weight of the debtberg and for savers, not being compensated for loss of purchasing power, surely to accelerate. Therefore, the political option to keep IRs low is the most impossible one. It is complete nonsense to believe that massive bankruptcies will be accepted, tolerated or be an ode to the free market. The tric with selective defaults will not work this time. Things have gone too far.

It is for all the above reasons that I've exchanged most of my paper, into...yeah, you know what...(smile). Can you give me one good reason, why I made the wrong decission ?
Thanks and regards Topaz.

slingshotPaper Avalanche#8680210/7/02; 06:47:30


Good day to play hookie from work.
I too await the results of the meeting.

Paper Avalancheslingshot#8680310/7/02; 07:05:00

Greetings! I cannot believe that this story has been on Drudge for the last hour and Bloomberg does not even mentioned it in their top stories. Is someone asleep over there in their news room? Have a great Monday!


slingshotPaper Alvalanche#8680410/7/02; 07:16:52


They are asleep at the wheel my friend.
Rudder fouled and going in circles.
Something about today told me to stay home. Too many 12 hour shifts.

GoldnSilver2002Be careful what you read in the american press#8680510/7/02; 07:18:49

First great american myth:canadians want to be americans.

second great american myth:canadians want to use the u.s dollar

I watched the warren buffet interview here in europe and watched the american media print" buffet bullish on u.s stocks again" lol rofl.He did not say that,he sia dhe was a bull on us a and uk 10 ,20 ,30 years dwon the road.

Canada says "we dont want free trade!" MUlroney rams it through parliament illegally becoming the most hated prime minsiter in canadian history.Americans thisnk they want to be american.

Canada says no us dollar ,us media prints "Canada converts to us dollar"

Did the american media warn anyone about enron,worldcom,tyco etc before it was too late.

I was in europe on sept 11 th.On that day the european media reported BIn laden did it.American media says for one week,we dont know who did it yet.

From the outside ,america appears clueless.The world watches your media and says "are you really buying this b.s?"Bush is acting more and more in facist manner everyday.If canada becomes part of the us it will be because bush invades due to terrorist threat,when he really wants our water,electricity,gold and silver,nickel,cooper etc mines ,our trees and our fish.

America is no longer seen as a just and righteous society.For decades it was justice for americans but not for the world.Now i see the us govt slowly turning on its own citizens.Looking more and more like a hitler/nazi scenario every day to me.

Let me make something clear,i dont want to be an american.Because i dont like americans?NO!!!
Because i like to travel and have you ever noticed how happy people are all over the world to see canadians,and how americans have to wear a maple leaf on their backpacks when you travel?You needs us america,the world will talk to us.

Gold has to give soon.

SpartacusBanks Fall on Loan Fears#8680610/7/02; 07:25:53

New York, Oct. 7 (Bloomberg) -- U.S. stock-index futures fell amid expectations loan defaults will increase, cutting banks' earnings. Citigroup Inc. and Merrill Lynch & Co. declined.

``People are running for the exit before they hear more negative news,'' said Miles Berryman, who helps manage $2 billion at J.P. Morgan Chase & Co. in London.

Spartacus: Today could be an interesting day...

SpartacusJapan's Leading Index Points to Economic Contraction #8680710/7/02; 07:30:12

Tokyo, Oct. 7 (Bloomberg) -- Japan's index of leading economic indicators fell to a level that predicts the world's second-largest economy will shrink as soon as November, cutting short a recovery from the third recession in a decade.

The leading index -- which includes job offers, machinery orders and other measures of future activity -- dropped to 44.4 percent in August from 70 percent in July. It fell below the 50 percent level for the first time in eight months, indicating a contraction in three to six months.

Golden BearBelgian (msg#: 86796)#8680810/7/02; 07:36:04

"...What is good for the dollar block will decreasingly be good for other blocks. That's the idea, I wanted to suggest to the forum. What's wrong with it ? TIA...."

Daddy Bush's NWO plans are an attempt to bypass the ascension of Gold as the ultimate monetary vehicle to transact business with little fear of loss of purchasing power by those who know the real value of bullion.

With the US economy crumbling before our eyes, the USD is on the road to destruction. Many have commented here regarding the new coloured notes to replace the greenback, under the premise of fighting counterfeiters, but in reality to mask the coming devaluation...

However, by the US increasingly becoming imperialistic, and taking over and controlling the oil fields of Iraq and possibly Saudi Arabia, the US has the potential of becoming an exporter of crude,as well as consumer of it, and this may offset to some extent the ascendancy of gold over the $USD. The US could then demand gold for oil as payment thus beginning a new cycle of gold accumulation to shore up the empire...

Yes, default of the US debtberg is inevitable, but with the NWO controlling oil and accumulating more gold quietly, other nations will need to buy crude, irrespective of getting their fingers burnt by the US defaulting on foreign holders of US paper, just to keep their economies barely turning over...

In theory, possible, but plausible?

slingshotGoldnSilver2002#8680910/7/02; 07:39:02

Needs Who?

Let me point out that anyone worth their salt needs nobody.
Yea, the USA has its problems and they may look down in the dumps. You underestimate US. You watch what happens if the War breaks out. We will go it alone. Bet On it! O.K I will give you Britain. That alliance goes way back. Do not get me wrong for I do have Canadian friends. I treasure their friendship. I think you were slightly out of line from my perpective.

TruthcasterKind of weird to See the dow up#8681010/7/02; 07:44:26

It's kind of weird to see the US stocks moving higher
after all the overseas markets getting hit hard
last night. I say that something is up. Gold is down
a little to. Maybe it's going to be one of those
200 point up days made out of thin air. Hmmmm.

GoldnSilver2002Taking a shot at us media and govt is bad now ?#8681110/7/02; 07:47:22

Depends,if you kept hearing from canadians and our nedia "all americans want to become canadian!" How would you feel?Am i going after americans no!I know they are misunderstood.Why because the whole wolrd watched your media and actions of your govt and goes ,this isnt making sense.Yes america land of the free,but how do you trust and understand america?No one understands bush's actions anymore or his exact intent here.He has been heavy handed in all his actions and now to me,he may clamp down on americas freedoms now,including the right to criticize or diagree with the us govt or what it media says or prints.I also want it on record,i dont wish to be american any more than you wish to be canadian.As such i often deeply resent what its media prints about us.And i ,also i fell i better represent my contrymans true opinion more so than the us media.No slight intended on americans.MY brother is one and both he and my dad live in cali.But id say the same thing to them!
RockSlingshot.#8681210/7/02; 07:50:21

Good morning my friend, I enjoyed reading your post this morning because it rang like church bells in my ears. I too am solid in precious metals. I cast my whole lot for the metals and I'm dug in for the long haul if need be. I'm just a regular Joe Sixpack also with no degree of any kind except the "School of Hard Knocks" as you say.

I'll tell you this Slingshot, experience is equal to or even surpases education in many cases. For example I read recently in the newspaper where a major pharmaceutical company was hiring for a sales position. They required a bachlors degree in biology and science. With only experience in my quiver and no formal education I called the comnpany and spoke with the sales manager.

Not only did I get the interview but he wanted to hire me! I told him all I had was ten years at a dental company but because I had the experience dealing with clinicians and so forth he offered me the job. I almost took the job but there was one catch, I would have had to buy a new automobile to use to travel for the company because my ten year old Ford Ranger may not have been up for the task. I didn't want to spring for the extra cash to buy a new car for a job I may not even like.

The moral of the story is don't ever disregard the expertiese one can gain from the School of Hard Knocks. I had already invested in gold and silver as well as had an emergency necessity program "prior" to discovering this castle so when I read posts like Blackblades and others sounding the alarm to prepare I was pleased that I wasn't alone in thinking that the market would crash and that precious metals would be the investment of the future. This bunch keeps me motivated and encouraged that I'm on the right track.

I enjoy watching this market more than I do Sunday football. It is exciting. Hey Boxman how much water do you have to swallow down with that 30,000 pounds of food? Don't tell me you live by a fresh water river or lake.

BREAKING NEWS! Another corporate big shot is getting a new pair of shinny braceletts. Worldcom's former accounting director is expected to plead guilty today.

MORE BREAKING NEWS! A thirteen year old boy was just shot in a Maryland grade school They didn't know he was shot until he just collasped. Is it related to the sniper shooter? We'll know in a few hours after billistics. My guess is its the same guy. The boy is in critical condition.


slingshotGoldnSilver#8681310/7/02; 07:56:15


My dear Knight. There are no boundries as proven by this forum and it is useles to say who is what among countries.
We are GOLDBUGS and nothing more.

old goldGoldnSilver2002#8681410/7/02; 08:04:28

The truth is always welcome! I have been overseas more than once, and am very aware of what you said, too bad the rest of my fellow Americans are not so enlightened. I met several Americans wearing Canadian patches on their backpacks. Americans need to wake up, get their collective faces out of the boob tube and educate themselves!
slingshotROCK#8681510/7/02; 08:16:27


Sometimes I feel that Goldbugs get alittle mushy. I find the cold hard facts here. Mortage Defaults, Consumer debt,poor savings, Enrons, unemployment , on and on. So ROCK, I am here. Like a Alabama Tick. Till MK or Randy kicks me Out.

slingshotOld Gold#8681610/7/02; 08:20:21

Get out of the Tube

How Right you are.

Please post again.

Buena FeBelgian (10/7/02; 05:44:28MT - msg#: 86796)#8681710/7/02; 08:20:47

excellent piece. the battle royal; world system #7 (US$) vs world system #8 (Euro), rages on. Gold will continue to benefit, probably to thousands/ounce. Once #8 has become firmly entrenched (NWO) (5-20years, just a guess) gold may be subdued once again for a short while (7yr).

bush war talk is ALL because #7 is very near capitulation! my bet is that capitulation comes before war is allowed (bye bye JPM). Cresendo of stress could peak within two weeks (just a guess), what event crystalizes the shift, i do not know, but we will all recognise it when it comes (maybe an "act of God" ?).

cyberbat@ Slingshot#8681810/7/02; 09:45:53

Say what you will when you want to on this forum. We all have a survior mentality with type A driver-driver personalities. I like it that way. If anyone is faint of heart or a screeming liberal on this forum, they will not be able to withstand verbal darts from time to time. If so, they need to leave in a hurry. Only rock hard concrete principals reside here and no one is going to change our minds.
Anyway,I like a good verbal jousting contest from the knights at this castle from time to time.

old goldAmerica's ignorance bubble & gold#8681910/7/02; 09:47:14

The first time I went to Europe I was shocked to learn the differences between the Europeans and the Americans. The main difference I saw was that the majority of the people I met were highly educated compared to Americans. They seem to know much more about world events, history, economics, culture, etc., than their counterparts. Sadly, I talked to many people who knew more than myself about my own country's history and politics. A very humbling experience. Europe educates it's youth, we seem to only brainwash ours for the exclusive benefit of corporations. I am an American and I say no to war. Our priorities should be love & peace. The people of America may not realize what a perfect store of wealth gold is, but the rest of the world does. It's past time we the people educate ourselves. If we allow our govt to pollute our food, brainwash our children, steal our wealth through corrupt, oh nevermind! I'm going to go listen to a Bob Dylan album....
sectorFed's Surprise Rate Move--A Cut?#8682010/7/02; 09:59:24

Maybe Not

With the ECRI's Future Inflation Gauge rocketing through an annualized 25.9% as of Friday's report at, the Fed would be reckless indeed if it moved to cut the rates further.

Three top mouthpieces last week said that "Rates were low enough". Perhaps there is dissention on the FOMC? In any event we will get some interesting results from the FOMC today.

The hot money in the HUI is betting on a DOW short covering rally by comi9ng out of the unhedged miners. This is a clear buy signal for the long-term gold bull believers.

IF the FED RAISES the interest rates there will be a massive move back to the HUI as the DOW would dive on the news.

Gauntlet-Runner2("GR2")Consequences of War#8682110/7/02; 10:00:25

Greetings to all. I saw this essay and realized how shallow my thinking was. We may win the "battle" against Sadam but loose the war for cheap oil.

As we perceive the world's stock markets as becoming unstable moreso as time goes on. If the "outsider" countries fall apart first it means a capital flight to the "insider" countries. Offshore finance is no competitor because there is nothing there to invest in. The funds recirculate back into perceived stabile investments as soon as the checks clear. So if the EU banks get weak then the capital will flow to the US. Then we become perceived as to be strong and a "sootheing cycle" begins. Yin and yang at it with outsiders causing havoc and insiders catching the inflows from their malaise. This is an overly simplistic model but some of this is happening I believe. Capital flight from the third world to the first to is the free candy the analysts chewing on. On a national scale there will be capital flight internals to be studied. We see stocks going down and a rush into bonds and some gold. Real estate is churning but the effects of low interest rates are softening the blow of deflation to some degree. What can happen as unemployment increases is that we drift away from the 1870's style deflation into the post '29 style where wages fell faster than prices of goods. In the 1870's goods fell faster than wages so people didn't feel the monetery contraction as bad. With the failure of "push on the string" economics, the next remedy is to prime the pump with a cash injection, with the max amount allowed being the rate of deflation. This has the effect of a small dose for the addict. Enough to ward off a seizure but not enough to give the addict the same buzz. Stagflation phase ensues and leads to the next stage, serious inflation.
With the near total ignorance about gold and anything "old school" in the USA, I see gold being bought by foreignors first and then a shift to a two tiered monetary system inside the US when foreignors want settlement in gold as we cannot pay back the national debt except with the puffed up currency crisp that goes snap, crackle, and pop. However the powers that be are wiser than Daniel and can come up with a plan to destabilize the whole freakin planet to get them to run to us for help. Exactly the proper way to use the big gun. You just wave it around and fire into the air a few times and the hood jumps back over the fence to it's side of town. War on rugs then a war on drugs, honey who shrunk the thugs? Squash em quick. The ultimate Nasdow distraction. They bomb gold and silver with naked shorting, these emperors are running out of clothes. So JPM is in a coma............^.........^.........^

They just find another bank to step up to lease gold and keep bombing it. Until the AIDS sores start showing up down on the thigh and her stock price drops, they still want to dance with her. So then that bank gets rushed to the hospital and declared "unstable condition".

If silver is mined largely as a byproduct of copper and other metal ores, and those prices are down which would decrease world production, then silver production has to be "off" and the nations selling silver would see their metal hoards as being more valuable without any viable alternative.

The most bullish outlook for gold is that it has drifted up into it's upper region in the channel between 305 and 330. Continuous attacks are obvious and longs are skittish about entering at these levels. So they haven't bought in yet and gold shorts aren't making a dime yet are incurring risk more and more as time goes on and the gold price won't breakdown. A lion strengthens his muscles not by lifting weights but by grabbing into a tree and flexing against it without moving. That is exactly what gold is doing above 305 and 310. Genuflexed pattern. Baseing out above the last base. Channel locked with physical supply diminishing, and a lack of idiots willing to naked short. Some of the war has been priced in, but none of what was written in that article link has been fully perceived yet. An overthrow of the current Saudi regeme with a more radical Islamic compromise to restore (non-order).......oil could really rocket. Then gold then silver with silver doing the higher percentage because it's down more percent. I have no idea as to the time this will occur. -sorrowful but ready GR2

Buena Feold gold#8682210/7/02; 10:08:23

.........oh nevermind! I'm going to go listen to a Bob Dylan album....

ha ha, now that is great advise!!!!!!!!

i agree with your observations, we are witnessing the dying phase of a world empire (#7=anglo-british-american), has anyone else seen or read the book by michael moore (?) called "stupid white men"?

sectorFalling Shares as a Symptom of Something Bleaker#8682310/7/02; 10:14:32


Maybe the stock market really has been predicting the future of the economy.

In just the last two weeks, growth has begun to look a good bit weaker than it did during the summer, when the economy seemed far healthier than Wall Street. One victim of the new weakness could be the soothing theory that the continuing fall of stocks is nothing more than a correction of the 1990's bubble, rather than a reflection — or a cause — of new economic problems.

Pick just about any measure of economic activity, and it looks uglier than it did before Labor Day. Ratings of the economy's condition have fallen to their lowest level since 1994, according to an ABC News/Money magazine survey and one by the Conference Board. These worries seem to have led to small cuts in consumer spending, with sales weakening even at Wal-Mart.

Still struggling to revive profits, businesses have reacted to the drop in confidence and a potential war in Iraq by making a new round of cutbacks. Office vacancy rates have risen. Airline travel has stopped growing. Last month, the manufacturing sector shrank for the first time since January. Most worrisome, many companies have turned to layoffs again. Although the Labor Department reported last week that the unemployment rate eased slightly in September, a separate survey found that business payrolls fell for the first time in five months.

The Japanese NK225 300 point-plus fall late night is yet another red flag that things are slipping into the "Abyss".

PizzHow Do You Cover the Collapse of a Multinational Bank(s) and Other Things#8682410/7/02; 10:29:43

Well, if it's just a Japanese or European Bank, you try to ignore it, at least in the US press, and then just blame the management or politicians, etc..

Now, a US multinational bank with it's fingers into every dirty pile of laundry out there, it's going to be a bit tough. System failure? These guys are the system, and it's no more corrupt than our politicians.

Can you imagine the impact of major banking executives in front of Congress taking the 5th, let alone an ex Treasury chief.

Well, Mr. Sadaam, guilty or not, I have the feeling that what's about to happen is going to be all your fault. My favorite "wag the dog" senario is going to be a small pox scare. We either draw a line in the sand with politically unreasonable demands that we know you won't keep and then launch the mother of all conventional blitskreigs. Then do a mass small pox vaccination program that will scare the crap out of everyone in this country, with a commensurate economic crash that will conveniently cover the total financial mismanagement of the last 10 years (50??).

Or, if you capitulate and roll over, we'll just have the small pox scare first, then go after you.

Just thinking out loud, but honesty and a proper financial cleanup carries with it just a bit too much jail time for way too many players. Love to see Fastow come clean, might open a few eyes.


Whatever senario is played out over the next few weeks or months, they best get on with it, and the reason? My father-in-law asked me about gold and silver this weekend, and commented that the system is in trouble. Now, had he been a retired business man, or out of the financial arena, it wouldn't have bothered me as much as this guy lives in a small rural town, and retired out of the construction industry. This man is a flag waving, pro union, pro life, church going American, and I was shocked to say the least at his change of mind set in the last three months. The backbone of this country is starting to smell rotten fish.


Thanks to all posters this weekend. Was out of town and it's sure nice to be able to come home late on a Sunday and be able to catch up in about half the time. . .(rotten golf game, but great weather).


Dow up 81 with a two to one NEGATIVE advance deline line. Give me a break, this is just a bit too obvious.


Buena FeBlair warned war to oust Saddam 'illegal'#8682510/7/02; 10:30:07

Tony Blair, the UK prime minister, has been warned by his attorney-general that military action against Iraq to force a regime change would breach international law..............
...........Were the government to breach international law, it could find itself before the International Court of Justice facing charges for breaching the UN charter.

The US is unlikely to be deterred from unilateral action by such constraints. However, such action would strain relations with the UK, America's closest ally. Mr Blair would find it difficult to support the US without splitting his party.............


slingshotFaint of Heart#8682610/7/02; 10:34:59


I concur. The drawing of swords and the impact of steel blades can only bring about truth.
I stand at the ready.

goldfoolTruth in a bottle#8682710/7/02; 10:43:43

"The first panacea for a mismanaged nation is inflation of the currency; second is war. Both bring a temporary (and false) prosperity; both bring a permanent ruin. But both are the refuge of political and economic opportunities."

Ernest Hemingway

slingshotStock market#8682810/7/02; 10:44:31

Oh Come On!

Up 72 .70, 780,125,000 shares.
half the day over.

slingshotBuena Fe#8682910/7/02; 11:06:37


I believe there is a 70% chance of going to war.

RobotGuyStock Market Superstitions#8683010/7/02; 11:12:03

Month of October - - - Oooooh scaarrryyy!

You know, for a bunch of guys who are supposed to know what they're doing in life (wall street bigheads) they sure fall away from the market for the most riddiculous of reasons. I know,.. I know, most of them are lemmings anyway, and the major portion of their vocabulary are the words "really?" and "I better sell!" The most riddiculous thing in my opinion is fear without reason, and quite frankly there's a lot of that out there. If I had a decent sized chunk of money right now, I could make a fortune, and it's so predictable it makes me sick.


Cheers all!


mikal@Buena Fe#8683110/7/02; 11:35:24

Well said. The simplest things, like buying gold coins, are sometimes the hardest to put into practice. But we find encouragement when these things reduce and ultimately eliminate the obstacles to happiness.
OperativeWhat Happened To "We Report, You Decide" ????#8683210/7/02; 11:46:09

Oct 7, 2002

Television Live Coverage of President Bush's
Monday Night Speech

The Associated Press

Television live coverage plans for President Bush's scheduled 8 p.m. EDT speech Monday in
Cincinnati. The speech, which is expected to address the threat Iraq poses to the United
States and the possibility of war, comes as Congress prepares to vote on resolutions
authorizing military action.

- ABC: Not planning live coverage.

- NBC: Not planning live coverage.

- MSNBC: Planning live coverage.

- CBS: Not planning live coverage.

- FOX News: Undecided.

- FOX: Undecided.

- CNN: Planning live coverage.

AP-ES-10-07-02 0908EDT

This story can be found at:

PizzOperative#8683310/7/02; 12:21:44

What? Refund a whole bunch of advertising dollars for a prime time speach, let alone upset the masses interupting Monday nite football, Fear Factor, and the King of Queens.

Got to be something bigger than some mouthy dictator in . . .what was the name of that country that's supposed to have WMD??

Now, if Bush would consent to a 3 minute advertising break every twelve minutes. . . . . with potential preemption for critical situations in the game. . . .

Bordering on the rediculous.

Gee, glad to see the Dow finanlly starting to react to a 2200/900 negative advance decline line . . we be down 9 points as I speak. Couldn't be that 7500 is the neckling for the Dow on a MASSIVE head and shoulders formation (monthly charts). . . but they forgot, the S&P500 already broke it's neckline, but the Dow, can't let that happen, might scare a few people into cashing in their 401K's. . .


Operative@ Pizz#8683410/07/02; 13:27:51

"Bordering on the rediculous."

Well said.
Take the large media outlets that ten years ago were taken over by the accounting depts whose first act was to slash the news division budget. Add the next generation of left wing/liberal college educated journalists who are now in management positions at the networks. What you end up with is a network that calls "entertainment tonight" news, and that puts the ad dollars over any program that might be of possible use to American Citizens.

One of the reasons why I visit this forum daily is I get more news, informed insight, and thoughtfull commentary in one day than a weeks worth of watching the Networks. Truth, seek her where she may be found.

Glad to hear you enjoyed your weekend. Golf, a great game if you dont keep score!! <grin>

PanGreenspan: Banks still in good shape #8683510/07/02; 13:33:24

Fed chairman says lenders have weathered weak economy!
PanTo be honest, i do not belive him!#8683610/07/02; 13:39:10

WASHINGTON, Oct. 7 — U.S. banks — hit by troubled loans over the past several years — have been able to weather the recession and stay in good health, Federal Reserve Chairman Alan Greenspan said Monday.
PizzSpeaking of Banks. . . #8683710/07/02; 13:40:25

Anyone else notice that Safeway has their own bank? Food for capital rather than illiquid real estate and paper in tough times?

When we are limited to cash withdrawals in the future, I wonder if a direct debit to an individual's account for food will count?

Interesting expansion for Safeway, expecially in times such as these


One of the PM stocks broke out of the pen today. HL bucking the trend and up over 10% today. I still think the PM stocks tend to lead the metal for breakouts, and I hope this is the start of something. Love seeing PM shorts burning, even in paper. . .


sectorFOMC is running a TAD late#8683810/07/02; 13:53:30


Thre of the Fed's regular guys just said rates were "Low enough" last week.

Do you suppose they "Changed their minds"... so soon?

Or perhaps they are pounding the table in a mini-revolt against the Master of the [Crumbling] Universe.

Not to worry. Astronomers have just discovered a really big ice ball outside the orbit of Pluto... so Mr. Greenspan can surely find a few square miles there away from the prying media.

Or maybe the FOMC has other things in mind than a rate cut.

Black BladeFrom The Mail Bag#8683910/07/02; 13:58:42

Another nice little diddy made its way into my mailbox today (from Bill Bonner's people at Daily Reckoning). I and others have our doubts about Goldman Sachs Abby Jo, however, the following does show how ridiculous her pronouncements have become:

"Bubble, bubble toil and trouble"...another ill-fated week for the stock market. The Dow fell 173 points during the week to 7,528 - its lowest close in five years. The Nasdaq tumbled 4.9% to 1,140 - its lowest level in more than six years! How could this be? Abby Joseph Cohen told us that this would not happen. But now that it has happened exactly like she did NOT expect, Abby feels confident that the worst is behind us and that folks ought to be buying stocks.

Yes, hope springs eternal as the trolls and pimps on Wall Street strive to pander their wares to the public. The endless parade on CNBC and CNNfn of overly optimistic analysts and CEO's is quite entertaining and yet provide no rational basis for a rosy economic outlook. Last week I noticed a string of CEO's paraded out to explain how rosy the economy was and that the public should get back into the water again (just never mind the sharks and piranhas). Yet a report was released last week that shows corporate executives optimism has fallen from 67% to 29% from last quarter. The reporting on CNBC is demonstrably biased. Don't be fooled because this market could easily fall much further even if the west coast ports resume operations and the US has success in Iraq. The fundamentals for the economy simply stink. Get prepared and hope for the best. You know the score – get out of debt and stay out of debt, stash a reserve of cash for expenses, accumulate Gold and Silver portfolio insurance, and start a storage program of nonperishable food and basic necessities.

- Black Blade

BTW, watch out for another high profile banking scandal to break in coming days. Already Credit Suisse Boston is in the hot seat today after a huge crumbling of German and Japanese banks over the last few days. There are a few rumors floating about a couple of major banks on the brink (hint - one could be a major Gold derivatives trader - though I am not sure as it is still just a rumor). Be careful as the markets could get very ugly in coming days if the rumors pan out.

Black BladeCarnival Barkers and Used Car Salesmen#8684010/07/02; 14:21:54

I see that CNBC is on a roll in the after market - oh yeah, the DOW drops 105 points to a new multiyear low, the Nasdaq crumbles and threatens to fall below 1100, and the S&P 500 goes sub 800. Yet CNBC trots out another market strategist telling us that now is a great time to buy stocks. Of course this same carnival barker said the same thing when the DOW was pushing 11,000. These guys are as bad as the analysts who are now facing prison time for telling people to buy into stocks while recieving kickbacks and writing emails to each other that these stocks were %(*# and worse. Buying stocks these last few months is like the old saying about "catching falling knives". Hey the DOW is off 26% year to date and the Nasdaq is off 46% year to date. What ever happened to "buy the dips"? Hmmm...

Is what what they mean by "the bloom is off the rose"?

- Black Blade

Meanwhile I will sip some yerba mate and watch a bit more of this nonsense on the tube before heading to the gym - I need something to stir up some aggression to work off (it's good motivation for vigorous exercise). Then maybe I will head out to kill something (the elusive beast is still out there and deer season opens in another week). Oh yeah, I just ordered Ted Nugent's book - "Kill it and Grill it". Hmmm...

WaveriderDAILY GOLD MARKET REPORT #8684110/07/02; 14:29:50

After being away most of last week there's been alot to catch up on. I'll admit though, while scrolling through the news...I was HOPING to see that Black Blade bagged his elk! THEN I realized that either way - BB - you're a winner, either you have a freezer full of elk steak, OR all the more room for ducks and fish and pheasant... YES? Cheers!

TownCrierSurprise Federal Open Market Committee meeting today???#8684210/07/02; 15:19:59

Sector, I had to scratch my head for a bit after seeing your two posts today, msg# 86820 and #86838.

What have I missed? What has given you the idea that the FOMC was to meet?

If I may be so bold as to venture a guess for the benefit of our attending clientele, is it possible that you are simply confusing the regular bi-weekly meetings of the Fed's Board of Governors with the FOMC? You've mentioned rate cuts, but as you should know, the discount rates (rates at which the Fed lends directly to banks) are not set by the FOMC but in fact by the Board itself. Under these current economic conditions, it would surpise me if a reassessment of the discount rate wasn't, in fact, taken up at each of these regular meetings of the Board. This is basically a non-event to the extent that each Board meeting is a non-event.

On the other hand, the real meat of monetary policy is generally associated with the FOMC which is composed of the Board of Governors PLUS a handful (five) of the 12 presidents of the Reserve Banks. As the name implies, it is this larger committee that decides on the Open Market policy, and the key rate that is associated with its domain is their announced target for the Fed Funds rate, not the discount rate.

I hope this helps.


RockProud to be an American#8684310/07/02; 15:34:18

I am an American, and very proud of it. I served in the US Army in the infantry. Especially lately I have been hearing individuals even our own countrymen brow beating America. This much I do know, had it not been for America everyone all across the globe would be wearing little swasticas right now. Sure America has made mistakes but we have been the peace keepers of the world and spilled our blood keeping it liberated, that's why France gave us the Statue of Liberty. I know other courties media may slant the news against the good ol USA but to me its still the greatest country in the world even with all her flaws.

Cheers to all,


R PowellSector#8684410/07/02; 15:59:13

Post (86750)


Old YellerTim Wood on the Denver Gold Show#8684510/07/02; 15:59:47

Some interesting John Hathaway comments in here.
TownCrierCurrency depreciation is the way the world works#8684610/07/02; 16:19:46,2276,59852,00.html?

HEADLINE: Poll says Bush should focus more on economy, less on Iraq

(WASHINGTON) -- ...according to a New York Times and CBS television joint poll published yesterday, some 69 per cent of those asked thought Mr Bush should be paying more attention to the economy, versus 27 per cent who said they were satisfied with the president's efforts on the issue.

--------(url for more poll results)------

What do these people expect their goverment to do by way of "attention" and intervention with respect to the economy? Bear in mind that the government's primary product comes from the printing press -- bureaucratic red tape, regulations, and currency. For the government to "do something", you can as a result expect your currency to become worth less. This is an ongoing never-ending march to the drumbeat of human affairs. Gold will help you deal with it to minimize your losses.

As for the Iraqi issue, the poll indicated that "67 per cent approved of the use of force to oust Iraqi President Saddam Hussein, versus 27 per cent who opposed it." How will it be funded? The invisible tax of inflation.

Looks like a heightened period of both currency depreciation and military action is in our politically drivin future.


BoilermakerPrize Received!! #8684710/07/02; 16:39:38

Thank you USAGold! The FEDEX guy just delivered my beautiful 1897 model British Sovereign with the stunning veiled Queen Victoria. God bless the Queen and USAGold. Too bad the new guys, neoliberalist Tony Blair and Fast Eddie George don't appreciate their monetary heritage.


TownCrierRussian Central Bank increases its gold holdings#8684810/07/02; 16:40:43

As reported today by the World Gold Council through Rhona O'Connell's report:

"The Russian central bank on Friday reported a rise in the value of gold reserves to $3.732 billion on October 1st from $3.731billion in September. With reserves valued at $300/ounce this implies an increase in holdings of roughly 3,000 ounces."

Have you added to your reserves lately?


TownCrierVeiled Queen Victoria Sovereign#8684910/07/02; 16:51:18

Boilermaker, I'm sure MK and the rest of the staff will be glad to hear you are pleased with your prize. I know I was pleased with your entry. (Speaking of which, I've nearly completed assembly of the page of the contest commentaries.)

The link above is to the Sovereign (queen) page so that everyone may see what your award looks like.

I hope your treasure grows in size with the passage of time.


sectorEmergency October 7, 2002 Fed Meeting Still in progress#8685010/07/02; 17:55:00

Government in the Sunshine Meeting Notice
Advance Notice of a Portion of a Meeting
under Expedited Procedures

It is anticipated that a portion of the closed meeting of the Board of Governors of the Federal Reserve System on Monday, October 7, 2002, will be held under expedited procedures, as set forth in section 26lb.7 of the Board's Rules Regarding Public Observation of Meetings, at the Board's offices at 20th Street and C Streets, N.W., Washington, D.C. The following items of official Board business are tentatively scheduled to be considered at that meeting.
Meeting date: October 7, 2002

Matters to be Considered:
1. Review and determination by the Board of Governors of the rates of discount to be charged by the Federal Reserve Banks.
Randy, this is the basis for my Fed meeting comments today.

I'm guessing that the emergency meeting to determine rates will continue until it's finished. All sorts of rumors about a co-ordinated rate cut between the ECB and the US.

They could go either way up or down.

mikal"Gold softer ahead of Bush speech"#8685110/07/02; 18:00:22

From the S. African, a supine, politically correct palliative, offering as much depth as a 20 second sound bite. News in politics, war and finance wrought from an identical mold. But I expect more someday, from this richly talented and commodity rich country.
Buena Feesoteric i know#8685210/07/02; 18:12:31

i don't know about the rest of you fine folk, but my "internal siesmic" (guts) meter is so active that i've hardly been able to sleep (anticipation not fear) the last few nights, maybe it will pass as nothing, but the last time i felt this way was just before the washington agreement, anybody sensing the same?
CoBra(too)Wondering What The President has to say ...#8685310/07/02; 18:13:02

- In due course - except ... "To take out Saddam is my ultimate goal". - Fine with most of us; Though, what're we gonna do after that? Go after any other despot, herlot, bigot, or even Don Quichote?
- And then, in the not too distant future, then we'll still have to face the wrath of an economy going south, paper valuations imploding and the general economy in a smothering and unprecedented slump! All the while debt has skyrocketed and is deemed - never to be redeemed! - No Way!

Sir Al already has stated that the banks are weathering the mild recession - in good shape. Well, if you call a loss in market value of 40 - 80% in the bank's market caps around the globe 'weathering', just wait until the derivative storm
hits them squarely in their own and their counterparty's softest spots!

Oh my, I may have overlooked, that Sir Al still feels that these modern derivative instruments have helped to bolster the balance sheets of the... the - oh, yeah, the culprits. A certain degree of being benighted, decrees to be be-knighted, if you're in the (politically) correct league ...

As we, wee li'l old Austrians just had to endure the lectures of a certain Myron, the moron, Sholes, who allegedly conspired to co-found LTCM - after getting a Nobel Price - to figure a way to exponentially lead a regular enterprise to financial fray. And BTW, because of it - the global monetary system was rocked a bit, and had to be bailed ... So that's Fisher's story - and semantics are uncalled for ... is it Pete or Irve ... What a nerve!

Considering the moron was talking on behalf of BA/CA (Bank Austria/CreditAnstalt - recently acquired by HVB (Hypo-Vereinsbank, just lost 85% of mkt.cap. since takeover)- it is tough not remember the 'alledged debacle of CA back in 31. Anyway, from (or for?) stock markets it is tough to learn from history, says the guru.

I'd say, tough for the guru, and pop goes the weasel...

OK, I'd better listen to what (your) Pres. has to say ... g'day - cb2

NibelungOne new afghani will be worth 1,000 old ones.#8685410/07/02; 18:17:33

Certainly this could never happen to one of the "hard" currencies!

AP Article on the new Afghan currency introduced today.

"Before if people wanted to buy bread, they had to take stacks of money with them to do it," President Hamid Karzai said on Sunday. "With the new money you'll be able to take one note and buy what you want."
One new afghani will be worth 1,000 old ones."

Ah, the joys of owning paper assets !

TownCrierThanks, Sector, now I see where you are getting the notion.#8685510/07/02; 18:28:12

Yes, I can easily see how that might confuse you. You've misinterpreted the meaning of "expedited procedures" as equivalent to some sort of emergency. To be sure, it is not the sign of an emergency. in fact, MOST of the Board meetings are done under these very same "expedited prodedures". The next board meeting will very likely be under expedited procedures, too.

What it boils down to is nothing more or nothing less than business as usual -- a "closed door" session because the discussion of discount rates is considered sensitive material not appropriate for general digestion by the market in real time.

So as I said in my earlier post, today's meeting is a regular meeting of the Board of Governors; that is not the same thing as a meeting of the (larger) FOMC. That's not meant to imply on my part that there won't in later days be an actual "emergency" meeting of the FOMC, but this assuredly is not it.

To be sure, the FOMC last gathered on September 24 (which was a sheduled meeting), and the next meet is October 6th if the schedule holds.

If my previous post on this was unclear, I hope this one has gone further to help you straighten this out. Let me know if I've left any stones unturned.


GoldnSilver2002Flanders field and churchill#8685610/07/02; 19:12:45

I realize this is a goldbug forum but firstly the reason we are not waving swastikas is because of churchill and the russians,if not for them hitler would have gotten europe and smoked the usa too.America entered ww2 when it was forced too by the sinking of two of its passenger ships.Flanders fields is full of all the dead canadians who bravely charged first only to have america print "canada screws up!"America did not win w2,uk,canada,australia,russia(millions died)and america won ww2.

For some strange reason after free trade with u.s our dollar crashed and our military was stripped down to two helicopters and a sub that sinks if it leaves the harbour.Dont ask us to attack iraq,all we have is broken beer bottles and hockey sticks.

Best speech by Bush yet tonight.Did you notice he said war is not imminent.Was that an attempt to hold down p.o.g?And greenspin sounds to me like he is trying to justify a rate hike in the face of all this bad news that isnt really happening.Greenspin is a talking head,too afraid to tell the truth anymore and too old to care.

BlackjackYakuza corrupted Japan Banks#8685710/07/02; 19:16:15

People can be forgiven for getting cynical. Japan's government and banks have lied so often about the amount of bad loans in the system that nobody really knows how much there is. Private-sector estimates of the total range from $400 billion to $2 trillion. Since 1992, Japan has announced at least ten financial "rescue" plans. All have been dashed into futility by the same treacherous reefs: corrupt links between ruling party politicians, zombie corporations, bureaucrats and organized crime syndicates.

The Japanese media continues to turn a blind eye to the real nature of the crisis by failing to mention the role played by organized crime. As Kohei Nakabo, the former head of the Japanese Bar Association says, the Japanese use the legal system to solve problems only a fifth of the time, for the rest they turn to yakuza (gangsters).

Yakuza members displaying their tattoos. Are Japanese banks similarly stained?About 20% of the supposedly "clean" loans sold to a major U.S. financial institution's Tokyo operations turn out to "be so contaminated by yakuza that we have to completely write them off," says an official at that company. A senior yakuza boss tells Forbes that gangsters and/or politicians are involved in "a bit less than half" of the bad loans in Japan's banking system.

Much of the bad debt not connected to gangsters lies in the hands of corporate zombies. In Japan, a commonly used method to identify a zombie is to look for companies with a stock price worth less than 100 yen (about $1). There are 150 such listed companies in Japan, concentrated in construction, retail, real estate and manufacturing industries.

Some 50 of these de facto bankrupt companies are on a deliberately leaked bureaucrats' "to be closed down" list. A true cleanup would involve bankrupting most of these as well as countless small and medium enterprises.

"It would cause GDP to collapse by 20% if we did that," says Akihisa Suzuki, an official in charge of bad debt issues at Japan's Financial Services Agency. More to the point, as Eitaro Itoyama, a billionaire Japanese power broker who tells Forbes he knows most big gangster bosses in Japan as well as the leading politicians, says, the efforts to shut down many big companies are stopped by politicians who are beholden to them.

The enormous scope of the problem, the cozy relationships between politicians and gangsters (and the tendency of many reformers to mysteriously commit suicide), explains why the Japanese government has blinked each time it promised drastic action. The result has been Band-Aid solutions that buy time but make the ultimate problem that much harder to deal with.
Great article on Japanese Banking.
A lot of these "bad loans" are criminal shakedowns.
Yakuza does not want "banking reform".

BlackjackS&P 500 : Triple Bottom Breakdown?#8685810/07/02; 19:42:55$SPX,PLTA[PA][DA][F!3!!]&pref=G

Chart looks bad for market.
Maybe a relief rally soon, but this
chart is scary.

SundeckDISTRESSED DEBT AT RECORD LEVELS#8685910/07/02; 19:54:23


" Troubled Corporate Debt Hits $879 Billion

October 04, 2002 10:52 AM ET


By Jonathan Stempel

NEW YORK (Reuters) - The total of corporate debt in default, or "distress," worldwide has grown to $879 billion, almost 45 percent of the entire high-yield debt market, and nearly one-third more than the gross domestic product of Canada, population 31 million.

The total, up nearly $200 billion in 2002, puts in stark relief the losses that many high-yield investors have suffered in their portfolios amid anemic economic growth, credit rating cuts, corporate scandals and tighter credit markets.

Edward Altman, a professor at New York University's Stern School of Business and expert on troubled debt, set forth the $879 billion figure at a distressed debt conference this week.

"That is by far the record," he said. "Our distressed market is (effectively) the eighth largest country in the world." (Canada in 2001 had a GDP of $677 billion, eighth in the world behind Italy, according to the World Bank.) "

Sundeck: How much worse is it going to get? Perhaps the worst is nigh... OK knights and ladies, time to cash in all your low-yielding "ancient relics" and put the money into high-yield corporate bonds! Hee hee hee :-)

kasperjackFundamental Facts#8686010/07/02; 19:57:59

Reuters Company News
Mutual Funds magazine to fold after
Monday October 7, 7:14 pm ET

NEW YORK, Oct 7 (Reuters) - Mutual Funds, the monthly personal finance
magazine published by Time Inc., is closing down after its November issue amid a
deep slump in advertising spending, the company said on Monday.
Redemption huh? It all depends on the definition.

Carl HReuters: U.S. Official Says Yemen Blast Looks Accidental#8686110/07/02; 20:08:34

WASHINGTON (Reuters) - The United States said on Monday it was unclear what caused a blast that gutted a French-flagged tanker in the Gulf of Aden but one senior U.S. official told Reuters it appeared to be an accident.

--- SNIP ---

CarlH: Uh....Yeah....Right....

Got Gold?

GoldflyChurchill and America#8686210/07/02; 20:38:56

From Churchill's "The Grand Alliance"

From his series of books "The Second World War"

"no American will think it wrong of me if I proclaim that to have the United States at our side was to me the greatest Joy. I could not foretell the course of events. I do not pretend to have measured accurately the martial might of Japan, but now at this very moment I knew the United States was in the war, up to the neck and in to the death. So we had won after all!"

There's more to it. He writes of how the British Empire, the Soviet Union, and the United States "bound together by every scrap of life and strength" could "subdue everybody else in the world." And further "Many disasters, immeasurable cost and tribulation lay ahead, but there was no more doubt about the end."

I love Churchill. His mother was an American. I wonder if we've got anyone like him here today. We need them. Because of the "disasters immeasurable cost and tribulation" part. I don't think very many people in the US understand what we are coming to and there is a dearth of statesmen who can be heard and make the case.

Not that I think that he was perfect. For all his railing against "Bolshevism", he was a one-worlder (at least a one-europer) and a socialist (True! Albeit a mild one.) But still you could say that the hand of God was upon him. A man for the times.

Al FulchinoGoldfly re Churchill#8686310/07/02; 21:03:54

From your mouth to God's ear.
Black BladeInvestment banks set to write off $130bn #8686410/07/02; 21:06:42


Investment banks in Europe and North America are set to write off more than $130bn in loan losses this year, the highest level ever recorded. The magnitude of the losses is set to trigger another wave of job cuts across the industry, as investment banks struggle to reduce costs and boost income amid persistently weak equity markets and the worst deal drought for seven years. Simon Harris, head of corporate and commercial banking at Oliver, Wyman, the global financial consultancy that carried out the research, said the losses also underlined the crisis facing integrated investment banks. These are under fire from US regulators and lawmakers for questionable practices over stock offerings and potential conflicts of interests involving analysts' research. Mr Harris said, during the credit boom of the 1990s, firms with commercial banking arms such as Citigroup and JP Morgan Chase aggressively used their ability to offer credit to forge relationships with big companies and win lucrative investment banking mandates. "As recent banks' earnings announcements demonstrate, this strategy is now coming home to roost," he said.

Black Blade: "Coming home to roost" indeed. There is a rumor floating around some circles that a couple of high profile banks are up against the wall and that some "news" might soon rock the markets again. We'll just have to wait and see, however, with growing SEC pressure we just might see this news break fairly soon.

Another rumor tonight is that Morgan Stanley is selling Gold again but there appears to be significant support at $320 an ounce. However, JP Morgan Chase and Citigroup are the two largest holders of Gold derivative positions.

Black BladeThe Sword of Damocles Over Metal Shorts – Puplava#8686510/07/02; 21:24:21


In contrast to the large derivative risk, you can look at the large short positions in gold and silver and in the precious metals stocks as not only a symbol of this risk, but also trades that bet on the wrong side of the table. The rise in gold prices and its stubborn persistence to be driven down by relentless short selling speaks volumes about the risks that lie directly ahead of us. Those short positions in gold, as reflected in the large short positions in JPM's portfolio and other bullion banks, are like a sword of Damocles that hangs over the financial markets. The one thing we all know about the precious metals markets is that they have a tendency, like a quiet volcano, to erupt at a time when nobody expects it. Right now the price of gold is holding up despite repeated attacks to move the price lower. The metals stocks, which have been this year's stellar performers, have come under increased short-selling pressure. Like the scarceness of the bullion itself, it erupts explosively whenever there is demand or when the financial barometer starts dropping like it is today. Because there are very few high quality unhedged mining stocks, they are owned and accumulated by very strong hands. Money flowing into gold funds, because of their superior performance over these last two years, represents a potent buying force as will short covering when a ten-sigma event catches them by surprise. It is one thing to short paper assets when the supply is endless. It is another thing to short gold and precious stocks when there is a growing demand and a limited supply. LTCM boxed itself into a corner by increasing its leverage as credit spreads widened and ten-sigma events multiplied. The gold shorts are doing the same thing. As more money moves into bullion and into precious metals, the shorts will be forced to cover. They are hoping that things will be much more subdued and quiet when they do. What they are hoping is that the divergence /convergence theme remerges. That's what their models tell them and that's what they hope will happen. However, we would suggest with a upcoming war, a slumping economy, growing defaults, bankruptcies, widening credit spreads, rising default premiums, Argentina and next Brazil, divergences are widening -- not converging as their models would suggest. It is just a question of which rogue wave overwhelms them, or worse yet, a series of rogue waves which could in fact be a hundred footer as experienced in the Halloween Perfect Storm of 1991.

Black Blade: A pretty good article covering the PM markets, market weakness, Alan Greenspan's position that "all is well", etc. It is interesting that banks and funds enter the fray to sell down gold and yet the investor comes in and pushes back. This has got to be frustrating to the big boys who simply can't understand why this is happening. Of course the big boys are in trouble as globally banking systems are on the verge of failure and are increasingly under the regulatory microscope as scandals and falling corporate earnings permeate the entire industry. I am curious if the Fed meeting today didn't have more to do with the quarterly review of banks and questions about required reserves (sorry but I forget the name of this periodic review which today is the due date for the latest review).

Black BladeRegulators: CSFB smoking gun found #8686610/07/02; 21:35:51

Massachusetts investigators say they have e-mails implicating firm in biased research reports.


NEW YORK (CNN/Money) - Securities regulators in Massachusetts say they have found evidence that Credit Suisse First Boston and one of its star investment bankers issued company research based on investment banking business CSFB received from the company, according to a published report Monday. Investigators found an e-mail between Frank Quattrone, CSFB's co-head on Internet investment banking, and his colleagues that show an analyst was pressured to resume coverage on tech firm Research in Motion after it had paid certain investment banking fees, according to USA Today. In one e-mail, Quattrone and others were told that Research in Motion (RIMM), the company that makes BlackBerry pagers, had "paid us the extra $1.8 (million)" and should be returned to "most favorable nation status." CSFB then resumed its coverage on the company with a "buy" rating, the paper reported. "This is clearly a smoking gun in the area of criminal responsibility, especially as it pertains to Mr. Quattrone," Massachusetts Secretary of State William Galvin said.

Black Blade: Ho boy, here we go again. No wonder investors are unwilling to dive back into the stock markets. This is Jack Grubman, Mary Meeker, and Henry Blodgett all over again. This class of scandal just won't die and go away. Unfortunately there are likely thousands more like this. As I say: when you see one cockroach it's a sure bet that there are many more.

Black BladeSyria Accuses U.S. of Eyeing Iraqi Oil#8686710/07/02; 21:48:10


DAMASCUS (Reuters) - Syria's official press accused Washington Monday of trying to get its hands on Iraq's vast oil reserves by hampering the return of U.N. arms inspectors and pushing the U.N. Security Council to authorize a war. "America's obstruction of the international arms inspectors' return to Iraq and its attempt to issue a new Security Council resolution that includes a threat of military force against Iraq lead to one end," said the state-owned al-Thawra newspaper. "The Americans have long planned to destroy this Arab state and today are implementing their scenarios for the appropriation of its oil and wealth under one pretext or another, under the umbrella of the United Nations or not," it said in an editorial. President Bush said in his weekly radio address aired Saturday, that "if...the Iraqi regime persists in its defiance, the use of force may be unavoidable."

Black Blade: The U.S. will get oil one way or another. That's just the facts of life. The global economy does not exist without oil – case closed.

Black BladeExperts Say Yemen Tanker Probably Attacked #8686810/07/02; 22:01:43


LONDON (Reuters) - An explosion that ripped through the French-flagged tanker Limburg off Yemen is more consistent with an attack than an accident, its owners and security experts said Monday. The Yemeni government has denied the blast was caused by an assault similar to the October 2000 suicide bombing of the U.S. destroyer USS Cole in Aden port, saying a fire aboard the Limburg caused Sunday's explosion. Captain Peter Raes, speaking on behalf of the owners of the vessel Compagnie Maritime Belge, which owns the ship's operators Euronav, said the near-brand-new ship -- built in 2000 --- is double-hulled, giving it extra protection in the event of a collision. The engine room was unaffected, a salvage team at the scene said. The hull was torn at the water line, implying some sort of major explosive impact, Raes said. "Another vessel colliding with the tanker would never have had the energy to break through to the cargo hold tank," he said. Security experts backed up his theory after crew were reported to have seen a small craft approach the tanker as a tug and pilot ship guided the vessel to port.

Black Blade: The debate continues. There are claims of an attack and counter claims of an accident. However, tankers don't spontaneously explode and crude is not exactly explosive. There are reports that threats were issued against foreign vessels in the Gulf and the Horn over the last several months. The location is curious as well considering that this fits the modus operandi of al Qaeda – remember the USS Cole.

kasperjackGerman American Rift #8686910/07/02; 22:05:24

Gold Must Inevitably Become Part And Parcel Of The Disrespect.

Merrill e-mail sparks European bank fears (
A damaging seven-line e-mail fromMerrill Lynch, the investment
bank, on Friday stoked fears of financial difficulties atCommerzbank,
one of Europe's largest banks.

- Oct 04 9:21 PM ET
Washington's 'Poisoned
And The German Problem
By Mike James
Frankfurt, Germany
Bush will never forgive the Germans for the Hitler comparison. As if JPM and who knows who else are not in as bad a shape as Commerzbank. One suspects Bush prefers revenge to working with Germany and France. That is a bad sign for the world economy...

Carl HReuters: Networks Pass on Bush Iraq Speech#8687010/07/02; 22:21:59

LOS ANGELES (Reuters) - The three major U.S. TV networks said they will pass on live coverage of President Bush (news - web sites)'s speech Monday outlining his case against Iraqi ruler Saddam Hussein (news - web sites) after the White House declined to request air time.

---- SNIP ----

CarlH: So the President of the US talks about taking the country into war and networks don't even want to carry the speech. This is bizarre. What does it say about the average US citizen? That they would rather watch their sitcoms than hear what the President has to say?

Got Gold?

Black BladeRe: Carl H - Television#8687110/07/02; 22:53:59

Actually I think that the White House ("Dubya") made it clear that they did not really have to televise the speech. I think that a strange request though.

Other than that, God forbid that anyone interupt Monday Night Football (remember the Heidi Game?), and then there are those who defintely don't want their soap operas interupted (remember the Watergate Hearings, the Robert Kennedy funeral train, and the first Iraq invasion when TV was interupted?). Americans can't be bothered with real life. They rather live in an illusion or a world of make believe. Maybe it is a result of behavior modification over several years. As most recreational drugs are illegal, television is the new opium for the masses. Anyway, that's my take on it. Cheers!

- Black Blade

neo 1from the latest Reality Check by Dr. Gary North#8687210/07/02; 23:35:16

"Japan's central bankers are now talking about buying corporate shares with newly created yen, thereby reliquifying the Japanese banking system and raising share prices. If the Bank of Japan can do this, any central bank can do it. Why anyone worries about price deflation is a mystery to me. With the power of money creation through the purchase of assets, there is no theoretical limit to how high prices can rise. Because people associate rising prices of whatever they sell or own as a sign of prosperity, there is always support for fiat money.

Could the FED buy up all of the shares listed on the NYSE? Legally, yes. What about buying all of the mortgages held by Fannie Mae and Freddy Mac? Of course. But wouldn't this be a financial revolution? Not conceptually, only pragmatically. The idea is inherent in central banking. If a bank can legally create money to buy an asset, there is no theoretical limit to the kind of asset involved...

At some low price - such as "free" - people will borrow money. That is why price inflation is in our future. Price deflation isn't, short of a banking gridlock, which is possible, but an unpredictable event...

What is unlikely to fall is the price level of the final consumer goods where the money flows. This is why I remain bullish on residential real estate, when purchased at a discount from middle-class people who are experiencing liquidity problems. The last time that home prices fell 20% or more nationally was the Great Depression. Home prices can fall in a region (e.g; Texas, mid '80's), but they do not fall nationally. When it comes to fiat money, the buck stops here...
In a detailed study by an economist at the University of Georgia, we discover that the average increase in housing prices, discounted for inflation, from 1968 to 1999, was 1.9% for existing homes. It speeded up after 1980: 2.5%. This is no bubble.
Fact: homeowner's equity as a percentage of household worth is now about 17%. This is very close to what it was in 1968, though way below the 28% in the early 1980's. So, not much has changed.
To compare housing prices with a bubble - the NASDAQ, 1996-'99 - is a serious misuse of language. Don't be fooled. Housing nationally is not headed for a major fall in price - it never is. If the S&L crisis of the 1980's could not bring down the price of housing nationally, nothing is likely to do so...

Stocks still look bad these days. This makes bonds look better. The fact that bonds are rising (interest rates falling) is not proof of deflation. It's proof of investor's fear of stocks. The investor's money has to go somewhere, and cash pays too little to inspire most investors...
Here is the fact of facts regarding central banking: the central bank can buy any asset with its fiat money. The stock market can fall, and I believe it will. But it can be saved from total collapse by FED purchases. The FED can buy up America's capital on the cheap with fiat money...

General deflation? Don't bet on it. Fiat money moves the merchandise."

Black BladeConsumers Face Higher Energy Costs#8687310/08/02; 00:00:29


U.S. consumers will pay 45 percent more this winter for heating oil and 19 percent more for natural gas to warm their homes due to rising crude oil prices and colder temperatures, the government said on Monday. With the U.S. economy already struggling, higher winter heating bills could not come at a worse time as the additional expenses may cut into consumer spending. "Under normal weather assumptions, winter heating bills for residential consumers could average from $100 to $300 higher than last winter," the Energy Information Administration said in its winter outlook. The cost of propane, used by some Midwestern homes for heating, is also expected to rise by 22 percent this winter, according to the EIA, the Energy Department's analytical arm. Because last winter was the warmest on record and this year's is expected to be more normal and colder, heating fuel use this winter will increase. The EIA forecast that heating oil demand will be up 19 percent, natural gas use up 12 percent and propane demand up 1 percent.

Black Blade: As expected. It should also be noted that there are several new NG fired power plants over the last couple of years that will draw on the NG supply so the so-called higher than normal inventory is not a very convincing argument for lower prices. Meanwhile, late tomorrow we should get oil inventory data and Thursday we will get the NG injection data.

AndúrilObservations for Goldfly#8687410/8/02; 00:38:27

Your comment:
"I don't think very many people in the US understand what we are coming to and there is a dearth of statesmen who can be heard"

That this may be truthful is not a thing of wonder. There is no reward for the statesman in this age. The example as evidence is close at hand. Look no further than the experience of ANOTHER and FRIEND. For much effort, anonymous in the purest demonstatration of statemanship, what was their compensation? A parade of libertarians demonstrating no lack of insecurity and dearth of worldly understanding ran these statesmen out of town on a rail.

Your observation stands. It is one thing to recognize a lack of understanding on the ground. It is another (devine) to know the reason for this lack. Who can say? Know thyself. Grow beyond. Accept the help where you may find it.

Have you been told about gold?

Black BladeDead Cat Bounce#8687510/8/02; 02:09:29

Asian and Euro markets are positive as apparently some feel that the markets were "oversold". Are they in for a surprise. However, this is likely a "spring back rally" or more commonly known as a "dead cat bounce". Not much conviction in Asia and Europe looks to fumble along until Wall Street gives some direction.

- Black Blade

Black BladeMarket Indicators#8687610/8/02; 02:18:31

US market futures are very strongly positive (at least for now), the USD is higher, Gold is losing ground, and petroleum is lower (at least until inventory data is released). Looks like everything but equities will be ignored today as the US markets could go through a "dead cat bounce" today as there is a lack of any meaningful economic data until Thursday and Friday. Of course a few more earnings warnings and downgrades could spook the markets. Then there is the continuing devastating dockworker lockout with the accompanying rotting perishables and lost jobs as parts and retail goods sit on the docks and ships waiting in harbors instead of moving to factories. Then there is the continuing war talk and geopolitical tensions. "Interesting Times"

- Black Blade

Black BladeDockworker Lockout to End#8687710/8/02; 04:06:20

Looks like "Dubya" has enpaneled a three-man committee as a first step to investigate the impact of the dockworker lockout. They have 24 hours to make their recommendation (which is a forgone conclusion), then "Dubya" will sign an executive order to force workers back onto the docks for an 80 day cooling off period as per the Taft-Hartley Act. However, it will take up to 4 weeks to clear the docks and start unloading the "parked" ships. Not to mention that dockworkers will start another "slow down" like that which led to the lockout to begin with.

- Black Blade

Black BladeGold and Petroleum Lower#8687810/8/02; 04:27:57

The POG and POO are lower as Dubya says was is not imminent or unavoidable. This means that OPEC will not raise oil production as their contention has been that the high POO reflects a "war premium". So even as oil inventorie fall, the pressure on OPEC to raise production is gone. Gold is lower as the war is likely off (for now). Meanwhile US market futures suggest a soaring rocket-ride when Wall Street opens. However, it remains to be seen whether investors will get suckered again.

- Black Blade

motown_gold(No Subject)#8687910/8/02; 04:42:47

gold investment demand

an interesting bit of news concerning gold and the increasing public demand for
for it. a friend of mine works at a firm that only accepts clients with a very
high minimum investment. i had told this friend almost two years ago, that it was
time to get into gold in a big way. i was subjected to some wall street spin on
why gold was dead and not necessary in the new economy and all the rest of the
spin im sure you are all familiar with. well one year after this, as my
investments had soared, his interest was a little peaked at least for my 'flash
in the pan' investment. he approached his team to talk a little about gold, and
he was subjected to the wall street ridicule from his colleagues. his boss so
much as stated that he hated gold, and did not see a need for anyone to invest
in it. well , now it is a year after this event, and my investments are still
heading north. he has actually bought at least a bit of a position, but still
was not really a big believer, but i believe this is changing very quickly. you
see, he admitted to another mutual friend, that in the last month or so, his
firm as seen a huge increase in interest in gold from their clients, and have
been asked to advise them on how to invest in this sector. many are pretty much
demanding that some allocation be put into gold. this firm of course knows
nothing about gold, but asked my friend since he was the only one that tracked
it, (thanks to my inundating emails i have sent him!) to look into it for them.
this is quite a big shift in sentiment from a firm who's leadership 'hates gold'..
the public is very slowly waking up to gold as a viable allocation to one's
assets. the types of clients at this firm, are not your usual joesixpack, but are
more financially astute people, who i would expect to be the first to jump on
our ship, but not the last. the demand for investments in this sector are only
very slowly waking up, and we have a very long way to go. this increasing demand
will drive gold up much higher than you would expect in the years to come, so
stay long and stay strong!

TopazBelgian, neo 1.#8688010/8/02; 04:57:59

Thanks mate for your thought provoking reply...and NO, I can't think of one reason to do otherwise (smile).
I've been getting conflicting impressions as we move forward Belgian, The "all paper will burn" scenario of Anothers...ignited by FoA's meltdown of the Gold Markets and the emergence of meaner leaner Global reserve currency...the Euro, backed by obviously STILL uppermost in my mind BUT... the dynamics appear to suggest something more like: If WE can't have the exorbidant privilige, then NOBODY can!...and (WE) appear to mean it.
Meanwhile WE (you and I) watch in bemusement and trepidation with Physical Gold.
Cheers Sir B.

neo 1,
Thanks for the Dr North article neo. What the good Dr fails to point out is HOW this monetised debt gets into the hands of the masses. Does he propose giving it away? I think Capitalists the world over would have something to say about that. I also believe the psyche of Mr collective Japan...and his American cousin are markedly different on this score and a Fed move to emulate the BoJ would prove disastrous. Deflation dead ahead...for the minute at least, and R/E only to live in...NOT to invest in, imho.
Your thoughts?

BelgianWim Duisenberg (ECB) testimony.#8688110/8/02; 04:59:46

My 2 cents reflexion on the ECB's stance in relation to Gold : Euro IRs will remain unchanged and always higher than dollar IRs ! This, to promote the euro, above the dollar, as widely as possible. This has a double effect on POG. First euro, second Gold -policy.

ECB, under Duisenberg, remains obsessed with "stability" AND "independance" from political/financial pressures.
This, with even more conviction than the Bundesbank, earlier. This might explain the stability of POG, together with the relative calm of the €/$ exchange rate.

The ECB remains very alert for "unforeseen developments".
Means that IRs/POG/€-$ exch. rate, can be changed appropiately. The ECB keeps it powder (Gold-?) dry, for the time being.

Very stringent, Stability policies OF THE ECB, have the purpose of restoring, economic, "confidence" ! Confidence to push back *unemployment* and make sound *profits* possible. The POG-behavior, must be placed against this background.

During question time, the Dutch, asked a question about the €/$ exchange rate policy and used the word "GOLD" in relation to the exchange rate management!

BelgianMore on the Duisenberg testimony#8688210/8/02; 06:26:59

What I thought to have understood between the lines, somewhere during the question time, is that in the case of "unforeseen developments", *automatic stabilisators* would be made more active. Duisenberg drew the attention on the POO as fallen under the unforeseen developments.
IRs fall under the automatic stabilisators, but so does POG !
The ECB (almost unanomiously) will certainly use the Gold-reserve weapon (dry powder) if the "stability" should be threathened by inside Euroland or outside (US) politicaly wrong choices. I even dare to go as far as the ECB telling the US not to invade Iraq, give confidence restoration some chaces, or we use Gold (POG). The sudden tone-change in the Bush speech on Iraq, might be some far off evidence ?
Who knows what is said and done behind those ivory tower walls ?

Duisenberg was (again) irritated with all those pressures (IMF especially) to lower Euroland's IRs in line with the US. IRs, within the present constellation(s), are economically totally ineffectif and irrelevant.

If and when a French presidium of the ECB should come, policies, might be somewhat different and especially related to POG ? More the *latin* way.

WaveriderCredit Suisse First Boston to Eliminate 1,750 Jobs #8688310/8/02; 07:23:43

"Credit Suisse First Boston will eliminate as many as 1,750 jobs, or 7 percent of its workforce, to reduce costs as global mergers and share sales slump to the lowest levels in at least five years. The shares of Credit Suisse Group, the investment bank's Swiss-based parent company, have dropped 70 percent this year, the worst performance among European banking stocks. Credit Suisse's investment bank and insurance unit are losing money, and the company is being investigated in the U.S. for the way that it allocated shares from initial public offerings. ``I've never seen a more turbulent time in the investment banking industry in 21 years'' in the business, UBS Warburg CEO John Costas said at a banking conference in London today. ``I don't think investment-banking business will return to the highs of 2000 for four or five years."

Waverider: BTW: Gold is off almost $4.00 this morning - not suprising after seeing PM stocks down around 5% across the board yesterday afternoon.

TruthcasterGold Getting Trashed This Morning#8688410/8/02; 07:36:43

I See Gold Is Getting Pounded In Early Trade
Down 3.80 But I Guess This Can Be Expected After
Seeing Gold Really Not Doing To Much The Last
Few Days And Even Last Week. And Also Looking At
The Gold Stocks Indexes Such As Hui And Xau Which We Have
Seen A Big Drop In The Last Week Or Two. As Well As
Falling Silver Prices. I Think We Do Need This Balance
Before We Can Move Higher.. This Could Be A Big Hit
In The Price Of Gold And Silver The Rest Of The Week
Will Have To Wait And See. It Will Be Something To

mikalBush moves may open ports in one or two days#8688510/8/02; 08:03:04

Judge May Be Asked To Reopen Ports
WASHINGTON, Oct. 8, 2002 Excerpts:
"The Bush administration is expected as early as Tuesday to ask a federal court in San Francisco to end the lockout at all 29 West Coast ports for 80 days, citing injury to the nation's health and safety, an administration official said.
That would mark the first presidential effort in a quarter century to end a work stoppage under the Taft-Hartley Act.
The court action is expected to follow a report by a presidential inquiry board formed Monday to measure the economic harm and detail the demands of both sides. Though the administration promised an unbiased examination, President Bush appears to have made up his mind that the dispute is hurting national security and the economy, and merits federal intervention.
If permitted to continue, the lockout "will imperil the national health and safety," wrote President Bush Monday, in his executive order establishing the board.
.....Just hours after federally mediated talks in San Francisco collapsed between workers and management, President Bush intervened and appointed the inquiry board - a step rarely taken by presidents and the first such move in the case of a lockout.
The PMA Monday released details of a five-year contract offer worth more than $1 billion as part of an effort to make the dockworkers appear piggish.
.....Labor Secretary Elaine Chao said if an injunction is granted by the court, the ports could be reopened in one or two days.
"The country has been patient. We have been patient," she said. "But now ordinary Americans are being seriously harmed by this dispute."
The department also warned the lockout could hurt national security, because the armed forces and defense contractors rely on commercial ships that use West Coast ports.
Historically, cooling-off periods have failed to permanently end labor disputes.....more at link

Mr Greshammotown_gold, Belgian, GR2#8688610/8/02; 08:10:08

motown: that was some fine information you passed along -- thanks! I hope that one fallout of this whole debacle will be the death of the idea of "Experts", and lemminglike investors thinking of themselves as "sophisticated". Simple, and commonsense, will be the favored terms -- I hope.

Belgian -- great work lately! Peeking behind the curtains of the future, and helping our minds embrace multiple possibilities.

GR2 -- I was happy to spot your handle back again yesterday, as I was hoping some of the newer posters would get to see your stimulating writings here.

Tommy PSucken treasures#8688710/8/02; 08:15:48

Not a bad haul at all!
CoBra(too)A Quote from Bill Bonner's Daily Reckoning!#8688810/8/02; 09:26:01

*** Gold went nowhere yesterday. It has gone almost nowhere for many weeks. So far, this is only a stock market problem; the monetary and economic problems have yet to be uncovered. When they are revealed, gold is likely to move. In the meantime, we are quite happy to go nowhere.

I'll leave it at that. Sum's it up nicely - CB2

motown_goldthank you#8688910/8/02; 09:40:31

to Mr. Gresham and Mr. Kosares for the nice coin!
Carl HBritain and U.S. Launch Deep-Sea Treasure Hunt#8689010/8/02; 10:16:35

LONDON (Reuters) - Britain and the United States have agreed to launch the world's biggest-ever sunken treasure hunt -- a joint mission in search of the gold on a warship that went down more than 300 years ago.

---- SNIP ----

Apparently this ship contains about 400 tons of gold. Sure seems like a lot of trouble for some barbarous relic. Could it be that the true barbarous relic is the paper currency system?

Got Gold?

Carl HCORRECTION#8689110/8/02; 10:19:15

It seems that it is only 9 tons of gold coins. (Apparently worth $4B) I had calculated the 400 tons from $4B/$320.
PizzMusings#8689210/8/02; 10:33:12

As JPM works it's way down thru 16 bucks a share, you may wonder what is going to happen to all the derivatives? Remember the old Resolution Trust Corp that the government set up to handle all the S&L problems of the 80's? I would expect something similar with the confetti disappearing into some big dark government paper hole. . . . with the right to offset in the new bk laws, who knows, the government will probably be able to get into all the commodity markets directly.

Sadaam must have had a good laugh last night watching Bush backpeddle his retoric to appease the liberals.

Twenty five more days like today and the DAX will be zero give or take.

When we finally do get a stock market rally, most are going to be relieved until they realize that it is going to be at the expense of the bond market, where just about everyone has run and hidden. . . think the smart ones will finally head for gold then. . .I do.


Paper AvalancheJPM back on the slide on chunky volume#8689310/8/02; 10:43:23

something big is going to happen in the next week or so IMHO.


The HoopleUtility crash!#8689410/8/02; 10:53:00

Anybody else watching this stunning collapse of the utilities? Index is off about 10-13% today alone. Duke seems to be racing JPM to zero. Whatever happened to the mantra of utilities signalling where the Dow is heading? Let's see, 13% down in a single day, that would imply maybe about a grand worth of Dow points. Pretty scary when the foundation of our civilization (power) is practically reduced to junk status. Wonder what counter-party risk is being triggered as this is written.
J-BullionNot sure if this was posted yet.#8689510/8/02; 10:56:51

California's gold production expected to fall by 70%
Source: Mining Engineering
Publication date: 2002-09-01
Arrival time: 2002-10-08

California is currently ranked fourth in gold production, behind Nevada, Utah and Alaska. However, some of California's largest gold mines are beginning to reach the end of their lives.
And as these mines run out of gold, the state's gold production is expected to decrease by 70% within the next two to three years, according to the California Geological Survey and the U.S. Geological Survey.

In 2001, California mines produced 13.9 t (449,200 oz) of gold valued at $122.3 million. That was a 19% decrease from 2000 and a 21 % decline from 1999.

However, California remains the nation's leading producer of nonfuel minerals, accounting for about 8.4% of the nation's total. And California is the nation's sole producer of boron and rare earth ores.

The state has more than 1,000 active mines that employ about 9,000 people. During 2001, minerals produced in California were valued at $3.27 billion, down from the $3.3 billion produced in 2000. Thirty-two industrial minerals accounted for 96% of the value. Gold and silver accounted for the remaining 4%.

Copyright Society for Mining, Metallurgy, and Exploration, Inc. Sep 2002

PizzPaper Avalanche#8689610/8/02; 11:05:44

I agree completely.

Sometimes, myself included, we get so wrapped up in the daily "noise" we lose track of the big picture.

For the last couple days I've been looking at monthly charts for the markets. Now, as long as we have paper markets, and they are not going to go away right away, you have to look at the PM stocks, and the HUI has a rounding bottom, saucer, cup, or whatever you want to call it with a pennant handle that is about as bullish technically as I have seen.

These bases in the PM's are of longer duration than the massive head and shoulders tops in the SM's, and these tops have been confirmed by every index except the DOW, and that is about to happen - DESPITE EVERYTHING THE PPT CAN THROW AT IT, and if you don't think they've tried, it appears that they've thrown the entire net worth of a lot of multi center banks into the pot.

Now, with gold refusing to go down, with a fundamental basis that will not go away, and a technical picture confirming the fundamentals. . . . .

Today is the second day of a two to one negative advance decline line with the DOW being supported at or around even. This is the equivalent of pulling all your wounded out of the hospital, shoving a gun in their hands, even if they can't load it (JPM), for one last ditch attempt to keep from being overrun.

Just like I just heard on the news, gold "sharply lower" today (down $3.00) with the Dow coming back strong and up 15. Give me a break.

All - don't lose the faith. . .things are lookin pretty good (for us).


Paper AvalancheAnd the winner for the biggest layoff is................#8689710/8/02; 11:15:16

Duetsche Telekom!
sectorStock declines threaten banks' net worth#8689810/8/02; 11:25:35

Yomiuri Shimbun

Major banks, which have already incurred a large amount of latent losses caused by a fall in stock prices on the Tokyo Stock Exchange, are likely to experience a serious insufficiency of net worth.

The government's policy to speed up the disposal of bad loans held by banks, which has been promoted by officials including Heizo Takenaka, state minister in charge of economic, fiscal and financial policy, caused their stock prices to decline and triggered a chain reaction, driving banks to the brink of causing a financial crisis.

The government will strictly review its assessment of bank properties and has considered injecting public funds in banks that have suffered from a shortage of net worth through the additional disposal of bad debts.

The government aims to strengthen the financial system and reconstruct the nation's economy. However, the project has created a situation in which stocks of major banks and some companies that have reconstructed their operations will be sold on the market.

According to The Yomiuri Shimbun's calculation based on an estimate by Daiwa Institute of Research Ltd., latent losses incurred by major banks amounted to about 4.8 trillion yen based on prices at the close of the market Monday.

A report by Merrill Lynch Japan Securities Co. on Monday showed that if the Nikkei Stock Average declined to around 8,000 yen, the capital adequacy ratio of some major banks would be lower than 8 percent, a standard required for banks conducting overseas operations.

According to estimates made by Goldman Sachs Securities, if all major banks are required to complete the disposal of their nonperforming loans by March 2003, 5.9 trillion yen in public funds should be injected into these banks.

The major banks now face increasing pressure to dispose of their nonperforming loans and may have difficulties dealing with declining stock prices.

If their hidden debts incurred from declining stock prices are to be disposed of in addition to the bad loans, they will need 9.7 trillion yen in public funds.

The major banks had a total net worth of 17.4 trillion yen as of March 31, 2002, but this sum includes 6 trillion yen in public funds injected to write off bad debts. It also includes 8.2 trillion yen in tax-related assets balanced forward to write off bad debts.

This is one of the reasons why investors started selling their stocks.

Supermarket operator Daiei Inc., condominium builder Daikyo and general contractor Kumagai Gumi, all of which are in the process of restructuring, face sharp declines in their issues.

A financial analyst said, "They will possibly face financial difficulties more severe than those they have now as the trust in financial institutions wavers in accordance with the decline in stock prices."

As a result, the banks will possibly incur additional losses.

According to observers, institutional investors abroad started examining the possibility of not only injecting additional public funds into these banks but also nationalizing them.

This move is believed to have caused Monday's sharp decline in bank issue prices.

A dealer from Deutsche Securities Limited said, "It is inevitable that the banks' ratio of net-worth to deposits will decline as a result of an increase in their reserves for bad loans and a decline in stock prices," adding, "Some of the banks will possibly be obliged to withdraw from their businesses abroad."
Details on the Japanese banking crisis.

Can you say hyperinflation.

kasperjackRussians Play Up German-American Rift#8689910/8/02; 12:01:04 America Knows Best Who Should Rule Germany

"It would be better for the chancellor to resign."

The White House is dissatisfied with Germany very much, and the Pentagon is even
more so. And this dissatisfaction is because of the German chancellor's strict opinion
concerning the US-led campaign against Iraq. Schroeder mentioned several times
already that Germany will not participate in this war, even if the UN approves it. The statement made by
German Minister of Justice Herta Daubler-Gmelin when she compared George W. Bush with Hitler only
added fuel to the fire.

when Pentagon senior adviser Richard Perle

arrived in Berlin, he immediately announced that
Gerhard Schroeder should resign. Perle doesn't care at all that Germans elected the chancellor in
accordance with their domestic interests. However, the American official strongly believes that if the
chancellor doesn't support US policy concerning Iraq, he should resign. Germany's Handelsblat quotes
Perle: "It would be better for the chancellor to resign."

Perle says that Schroeder's anti-war election campaign strongly undermined the relations between
Germany and America, and in a burst of revelation, he explained to the German people how much the
chancellor's pertinacity will cost the country. Is Germany still wishing to become a permanent member of
the UN Security Council? It should forget about it for a long time,

Many observers say that relations between Berlin and Washington are on the
lowest level ever registered since the end of WWII. They also admit that Perle's statements proved to be the
most harsh within the whole period of preparation for the war in Iraq. At first, US officials dared to speak
about Hussein's resignation only. But, as we know, appetite grows while eating.
Does the treasury have real physical gold in the vaults? Why didn't they contribute physical gold to the Washington Accord? Do you think the Germans will ever play the Weltke phonograph"we will sell some gold" the next time the gold cabal is threatened? Is the invasion of Iraq viewed by the Europeans as an effort to make an end run attack on the aspirations of a United Europe and upon the Euro? Stay tuned history is unfolding before our very eyes....

PizzWile Everyone is Concentrating on the SM. . . .#8690010/8/02; 12:01:05

Where's the real risk? Debt. And which country has the most exposure with no where to turn?

I'm beginning to believe that Pupalva's 10 sigma event is going to be a very sharp downdraft in Treasuries and Bonds. And not a six month gut wrenching grind, but a collapse.

With treasuries at all time highs and rates at all time lows, why hasn't the dollar rallied strongly? Foreigners are not jumping all over themselves to buy dollars to buy treasuries.

If this is what the SM's world wide are discounting, and they are discounting something big, it's going to get REAL messy.

If you stop and think about it, our debt market has less support under it than the air under all those high flying stocks. $75,000,000,000,000 in interest rate derivatives going up in smoke? Even the entire G7 can't paper over that one, let alone the FED.

Could also be why the utilities are tubing (thanks Hoople) Interest rates thru the roof.


Operative(No Subject)#8690110/8/02; 12:30:48

Oct 8, 2002

Bush Administration Prepares to Seek Court
Order Opening Ports

By Leigh Strope
The Associated Press

WASHINGTON (AP) - President Bush decided Tuesday to seek a court injunction to reopen
West Coast ports for an 80-day "cooling-off period," intervening in a bitter labor dispute that
has cost the economy as much as $2 billion a day, administration officials said.

The politically charged decision, which Bush planned to announce later Tuesday barring a
last-minute breakthrough in negotiations, would mark the first presidential effort in a
quarter-century to end a work stoppage under the Taft-Hartley Act.

Bush decided to order the Justice Department to seek the injunction after a board of inquiry
hand-picked by the White House reported that the two-week-old labor standoff has no
chance of ending soon, said two administration officials who spoke on condition of
anonymity. They held out the barest hope that Bush's decision to intervene might produce an
eleventh-hour settlement.

The board's brief report did not go into detail about the economic and national security
impact of the shutdown, but it held out little hope for a resolution of the conflict.

A cooling-off period would keep the ports open during the crucial Christmas season, in which
retailers are relying on imported goods to stock their shelves.

"We have no confidence that the parties will resolve the West Coast ports dispute within a
reasonable time," the panel declared.

After a fact-finding hearing in which it heard from both the shipping companies and the
unioni, the panel said, "We believe that the seeds of distrust have been widely sown,
poisoning the atmosphere of mutual trust and respect which could enable a resolution of
seemingly intractable issues," the board concluded.

The trade-off for the Bush administration is that a court-ordered truce could energize
organized labor - traditionally a Democratic ally - just four weeks before midterm elections.
Democratic candidates rely on heavy turnout from union workers, and some presidential
advisers fear Bush's intervention will drive angry labor voters to the polls.

On balance, however, White House advisers welcomed the chance to head off a burgeoning
standoff between the shipping lines and the union and perhaps ease concerns about his
handling of the economy. Polls show a growing number of voters want Bush to spend more
time talking about the economy than Iraq. His economic policies have either stalled in the
Senate or have failed to jump start the economy. Now he has an economic cause to

Businesses across the country have complained that they were starting to feel squeezed by
the shutdown and pressed the White House to step in to help end the stalemate, which some
analysts have estimated was costing as much as $2 billion a day.

The standoff, among other things, is causing Mitsubishi Motors Manufacturing of America to
run out of engines and transmissions, forcing the halt of auto production. Production will be
suspended at the start of the first shift Wednesday, according to spokesman Dan Irvin.

However, workers will continue to report to the Illinois plant, which assembles the Mitsubishi
Eclipse coupe and convertible, the Galant sedan, and the Dodge Stratus and Chrysler
Sebring coupes. The plant produces 850 cars a day.

The lockout, if permitted to continue, "will imperil the national health and safety," Bush
wrote in his executive order Monday establishing the board.

The Pacific Maritime Association, which represents shipping companies and terminal
operators, locked out 10,500 members of the longshoremen's union last week, claiming the
dockworkers were engaging in a slowdown.

The longshoremen's contract expired July 1, although it had been extended several times
before Labor Day. The sticking point in negotiations is whether jobs created by new
technology will be unionized. The average full-time dock worker in the ILWU makes $80,000
a year. The most experienced foremen can earn $167,000.

Just hours after federally mediated talks in San Francisco collapsed between workers and
management, Bush intervened and appointed the inquiry board - a step rarely taken by
presidents and the first such move in the case of a lockout.

"The ports are going to be open soon and this crisis we are in will be over," PMA President
Joseph Miniace said.

But James Spinosa, president of the International Longshore & Warehouse Union
International, said: "The government, along with the corporate world, are trying to break

Historically, cooling-off periods have failed to permanently end labor disputes.

Eleven coast-wide dock strikes have occurred since the Taft-Hartley Act allowing presidential
intervention was passed in 1947. In all of those cases the president sought court orders after
convening an inquiry board, according to the Labor Department. But in at least eight of those
instances, the 80-day cooling-off period failed to resolve the disputes and the strikes

"Experience shows that this simply delays the settlement process," said Michael LeRoy,
professor of labor and industrial relations at the University of Illinois at Urbana-Champaign.
"It does not end the dispute by any means. Typically what happens is the parties go back to
their corners and stew."

Jimmy Carter was the last president to seek to use Taft-Hartley to end a work stoppage in
the coal industry in 1978. The court refused to order the 80-day cooling-off period but did
order miners back to work under a temporary restraining order.

The number of cargo vessels stranded at West Coast docks or backing up at anchor points
has risen to 200. Dozens more were still en route from Asia. Already, storage facilities at
beef, pork and poultry processing facilities across the country are full - crammed with
produce that can't be exported.


On the Net: Pacific Maritime Association site:

International Longshore and Warehousemen's Union:

AP-ES-10-08-02 1322EDT

This story can be found at:

slingshotSiege Engine#8690210/8/02; 12:45:39

Gold above $300.00

The two riders left the castle with their instructions from the council. Their names were Jacin and Boaz. Two trusted Knights sent in harms way. Being brothers they would trust each other should danger befall them. They rode through the night, slowing at intervals as to not overheat the horses.
The air was cool and at their backs , as to bid them to reach destination quickly. And so it was. They had reached the same crest of the hill as Gandalf and Bonfir did and what they saw startled them. The Kings castle was on FIRE. They could see the flames flicker out the windows of the remaining towers. The main structure had lost its roof and smoke and embers fill the night sky.
A devilish glow shimmered at the entrance of the castle. They looked at each other in disbelief, for only a week before a beautiful castle graced the landscape. They dismounted and sat down upon the cool ground, watching and waiting for the dawn to break.

The dawn came slowly and the morning sun would show them the destruction. This once beautiful castle was in ruins. Black soot had charred its white walls. Its spires collapsed within its towers. One would think that dragons once again ruled the skies.
Seeing there was noone around they approached it with caution. When they came close they could see the heavy doors that protected the castle lay on the ground at the entrance. Their hinges chiseled away. The markings on the ground showed that draft horses were use in conjunction with heavy chain to pull the doors down. They entered the castle. What they saw was beyond comprehension. A ghastly sight. The fallen in battle were now a grotesque, twisted and charred forms and carrion fed upon them. Pitch had been thrown on them and put to the torch. Moving to the side they could see also that the emblems that skirted the courtyard had been defaced and were now unrecognizable. Only the pyramid and its eye remained untouched.
Boaz and Jacin entered the main hall and could see all was gone. Jacin turning to leave called to Boaz and both looked down to see something, which excited them. GOLD! A melted bar of Gold!
It was there all along. Hidden within the castle walls. They move the unmolded form from the embers and took it outside. Pouring water on it, it sizzled and soon was able to be touched.
They put in one of the saddlebags to take back to the council. They remounted their horses and exited the gate when Boaz noticed deep ruts in the road-leading north. There was also a multitude of horse and footprints. A large force had been here. A day and a half march from their camp and they did not attack?

They started their journey home.

silvergolongPM mining stock short activity#8690310/8/02; 12:48:05

Hey folks, has anyone noticed the large short positions being taken across the board in mining stocks? The positions are largest in unhedged miners. Click on the link above and see for yourself. I've loaded up the drop-down with my own personal favorites, or just punch in your favorite miner.

Has anyone read about this in the financial media? GG's short interest alone would take over 4 days to cover at average trading volumes. I'm not familiar with short cover statistics--is this unusually high? Seems that way to me.

Should be interesting to see what the latest short updates are in October when the figures get released.

kasperjackPax Americana?#8690410/8/02; 12:49:50

The President's Real Goal In
By Jay Bookma
The Atlanta Journal-Constitution

The official story on Iraq has never made sense. The connection that
the Bush administration has tried to draw between Iraq and al-Qaida
has always seemed contrived and artificial. In fact, it was hard to
believe that smart people in the Bush administration would start a
major war based on such flimsy evidence.

This war, should it come, is intended to mark the official emergence
of the United States as a full-fledged global empire, seizing sole
responsibility and authority as planetary policeman. It would be the
culmination of a plan10 years or more in the making, carried out by
those who believe the United States must seize the opportunity for
global domination, even if it means becoming the "American
imperialists" that our enemies always claimed we were.

Among the architects of this would-be American Empire are a group
of brilliant and powerful people who now hold key positions in the
Bush administration: They envision the creation and enforcement of
what they call a worldwide "Pax Americana," or American peace.
But so far, the American people have not appreciated the true extent
of that ambition.

In essence, it lays out a plan for permanent U.S. military and
economic domination of every region on the globe, unfettered by
international treaty or concern. And to make that plan a reality, it
envisions a stark expansion of our global military presence.

The report's repeated references to terrorism are misleading,
however, because the approach of the new National Security
Strategy was clearly not inspired by the events of Sept. 11. They
can be found in much the same language in a report issued in
September 2000 by the Project for the New American Century, a
group of conservative interventionists outraged by the thought that
the United States might be forfeiting its chance at a global empire.
A new millenium. A new America? Bush may or may not have a master plan. How would all this be understood in Smallville Superman? And how would this supposedly golden opportunity for America play out in the gold markets.

Carl HMerrill to Slash Nasdaq Stocks It Trades#8690510/8/02; 12:50:50

NEW YORK (Reuters) - Merrill Lynch & Co. Inc. on Tuesday said it would slash the number of Nasdaq stocks it trades to focus on the most widely held shares, a stark sign of how brutal the 31-month-old bear market has become.

The broker said in a statement it would stop trading all stocks listed on pink sheets and the bulletin board and some smaller Nasdaq Stock Market issues, in a move that will cut the number of Nasdaq stocks it trades to 2,400 from 10,000.

--- SNIP ---

I wonder what they will do when 75% of the remaining 2400 are on the pink sheets?

Got Gold?

Paper AvalancheDoes the PPT ever worry about obvious patterns?#8690610/8/02; 13:07:49

The obvious pattern that I am referring to would be the now traditional Tuesday short covering rally where they pop the clutch after the gold market closes. Joe Sixpack can't be that stupid. Or maybe he can. Oh well, at least these guys are predictable.

Paper Avalanche

Gandalf the WhiteWOWSERS there Sir Slingshot !#8690710/8/02; 13:20:33

Looks as if you used the Hobbits' "invisable ink" on the Siege Engine Saga, RIGHT after the two Travelers started on the return journey back to the captured Lord's Castle.
Hope you kept the MASTER COPY !

Gandalf the WhiteROFL !!#8690810/8/02; 13:25:07

That is not to be confused with "Invisible Ink" !

PizzSomething's up#8690910/8/02; 13:34:46

The S&P futures premium has just tanked and is holding about a -700 or so, WITH NO CORRESPONDING DROP IN THE indexes.

Usually the aritragers suck up this difference in less than a heartbeat with buy programs on the futures and sell programs on the stocks.

This is just unreal.

Black BladeThe Prez Sez ......#8691010/8/02; 13:58:42

President George W. Bush just gave the order - go back to work! It looks as if AG John Ashcroft will be submitting the injuction to the ports and workers union. They now have 80 days. Although the order will stipulate that workers return to work at normal speed. However, the union has indicated that they will work safely - code for work slow down. Another point is that it will take several days to unload much needed parts for industry and to work through the logjam. Also, many perishable items such as imported food and food exports sitting on docks are rotted and now must be disposed of. The work load has built up and it is unlikely that retailers will have a long wait to restock merchandise. It still looks like a lot of difficulty for the economy as far as the import/export picture is concerned - not to mention all the cancelled shipping over the last few days. In a word - "grim"

- Black Blade

Paper AvalanchePizz#8691110/8/02; 14:08:58

Do you have a link showing the S&P futures drop? I just checked MCRI and it doesn't show what you are referring to.


Sierra MadreOnce again, Judaism collides with Germany....#8691210/8/02; 14:14:40

It's there for all to see:

The Jew Richard Perle - perhaps the real power behind the throne - calls for Schoeder's resignation.

This is called "chutzpah" - blatant effrontery.

How is it going to play out?

Given the ample precedents - German defeat in two world wars - I'd venture to say that Schoeder will be unseated. If it happens, that's bad news for those of us who hoped that the competition of the Euro and its gold reserves might provide an alternative to the world-dominating dollar.

Will Germany cave? Zat is ze qvestion. Maybe Germany and its strong ties to France will prevent the wishes of Perle from being fulfilled.

Sierra - yes, full of poop, no need to remind me.

Black BladeInteresting Development#8691310/8/02; 14:14:59

It appears that the longshoreman union will take their case to court. They say that the Taft-Hartley Act cannot be enforced because they are locked out and it is not a strike. That is interesting because they do have a point. The act supposedly can only be invoked if there is a strike. This does not mean that the Prez probably can't just sign some executive order inregard to the lockout as a threat to national security, however, it could delay things a bit.

- Black Blade

RockMy Take On Iraq. ... #8691410/8/02; 14:25:02

I listened to President Bush's speech last night. I am a man of peace however I do agree with Bush on this one. Maybe I'm hearing something different than these protestors but the reports that I have heard indicate that Saddam has chemical and biological weapons and has used them in the past even on his own people. He's a vicious dictator. One of Iraq's top nuclear scientist who defected to United States has already gone on the record stating Saddam is trying to build a nuclear bomb and if he had the weapons grade plutonium he could have one to three bombs built within 6 months to a year.

What is it that people don't see here? For 10 years Saddam has defied the UN Resolutions and for the past 4 years there has been no inspectors! To be honest with you I believe Bush over Hussain. Its a fact that Iraq is harboring terrorist and they are still firing SAM's (Surface to Air Missiles) at US and British jets which are trying to protect the no fly zone which was put forth by the UN.

Bush has told Saddam to disarm and allow the inspectors back in with unfettered access or face United States and its allies, whats wrong with that? Do we want to wait until he builds a nuclear bomb before we take him out?

Didn't these protestors learn anything from 911? It was complacency for the past 10 years that allowed our intelligence to fail thus allowing 911 to happen. Things are different now, GW said your either with us or the terriorist and if you harbor a terrorist you are just as guilty as the terriorist. Its a known fact that Iraq is harboring terriorist.

I don't trust Iraq and I don't want war but I also don't want to wait for a mushroom cloud over a major city before the protestors admit there's a smoking gun. I don't want to see a breakout of mustard gas or anthrax before they say, oh I guess President Bush was right afterall.

WE CANNOT WAIT UNTIL SADDAM HAS NUCLEAR WEAPONS, if we do he will black mail the world. UNFETTERED ACCESS or WAR, its all up to Saddam Hussain. I don't trust the bastard myself.



Black BladeFrom The Mail Bag#8691510/8/02; 14:49:43

Another interesting piece of info in my mailbox today (courtesy of Bill Bonner):

"A milestone of sorts was reached in July," the Wall Street Journal reports. "For the first time in 15 years, investors took more cash out of stock market funds than they put in during a 12-month period." The exodus from equity funds has been gaining momentum. Much of this flight capital has set up camp in the Treasury-bond market - thought to be the Promised Land of capital preservation. According to AMG Data Services, investors yanked $51.1 billion out of stock funds during the third quarter and piled an unprecedented $49.5 billion in taxable bond funds. So far, selling stocks to buy bonds has been a good trade. "If you imagine the [stock] market as a mythical angry god that is demanding sacrifices of those who had long worshipped it, there is no way to guess when it finally will be appeased," writes Tom Petruno of the Los Angeles Times. "It already has consumed the early-retirement dreams of some, the college funding hopes of others and the reputations of hundreds of corporate executives. But it may yet want more."

Gold went nowhere yesterday. It has gone almost nowhere for many weeks. So far, this is only a stock market problem; the monetary and economic problems have yet to be uncovered. When they are revealed, gold is likely to move. In the meantime, we are quite happy to go nowhere. Consumer borrowing went up another $4.2 billion in August. And the mortgage industry, bless its heart, found yet another way to encourage consumers into
insolvency - the Household Asset Management Account, we believe it is called. It is a new type of mortgage that allows homeowners to simply write checks against the 'equity' in their home. But when the 'equity' goes down, do they get the money back? We don't think so.

This begs the question – what happens when the Federal Reserve ultimately raises rates? Of course considering that the economy is in the toilet it is possible that the Fed will lower rates again, but geezzz, they only have 1.75% left. And the stock markets are running on a wing and a prayer. There is no fundamental reason for the equities markets to rally (even this current bear market rally). The rally is running on pure adrenaline produced by fear and desperate hope. The real estate bubble is showing cracks as well. However, this new home equity loan strategy is worrisome as it is absolutely crazy for anyone to put their home at risk so that they can go deeper into debt. It's going to get ugly – at least more ugly than now.

- Black Blade

GoldnSilver2002a sobering day for gold bugs#8691610/8/02; 15:01:18

Well i felt it coming what with the emrgency meeting of financiers and bankers in luxembourg to Bush's "war is not imminent".Read my lips we never war was imminent.I pulled out early today(my gold shares) leaving just a little golden eagle(what the hell,maybe they are sitting on a goldmine) and my silver standard hammered down to nothing as silver fades into the sunset.Ive watched as the dow skids 2000 and gold goes up 5 dollars only to go down 5 dollars the next day when the dow climbs eighty points lol.If you think the p.o.g is rigged the gold and silver mining stocks are worse!Ad to this all the ceo's from the mining companies selling their options this month and you have a terrible month for pm's.Thats right at the vancouver gold conference i found out all the ceos etc sell in october take profit and then buy them back assuming they will come back up in price.Why im a talking?Because for all their talk hold the line boys gold is gonna break these guys cash in leaving us to hold the fort.If are generals are corrupt maybe like william wallace we may find we are in a fight we can never win because our own leaders are on the take from the evil english king(fed).

During my time in gold some things have occurred to me.What makes us sound any different than the tech bomb wall st pushers?Who is our leader and why?Bill murphy ,why?He cant be bought because he holds so much gold the fed and central bankers could never pay him off?IM still convinced there will be a two tier gold system.The american paper gold(manipulated) and the world gold trade(real physical).As goldbugs we are few and scattered living off the mantra gold is going up gold is going up ,all the while our leaders are now lowering their projections to 529 per oz!(Sinclair).I am buying a little more Physical now guys as i sell my paper gold.But not as much.What the hell if gold is going to 30,000 per oz then i dont need much and if its only going to 529 then i dont need much either.Ive finally figured it out,you dont need much,just a little real physical and then just go spend coz hyper inflation will be here soon and it will cost more tomm where as gold may be racing for 325 again and again and again.IM picking up 12 1 oz maple leafs and gold eagles tomm.Paying an assay on each(dont have to do that with cash).Then ill sleep just fine.IF gold is really going to the moon i guess my small holdings are too.Whew,and i thought i needed a lot of gold and silver!!Now i can sleep,hope all you ceos at the gold and silver mining camp can,coz one day soon we aint coming back.We need a unified position and a leader coz the cabal seems to have infinite ammo and i never said i wanted to take on a bunch of pirates armed only with a couple coins and a pencil.

PizzPaper Avalanche#8691710/8/02; 15:15:01

Regarding the S & P futures drop.

I use a real time data feed, and the drop came between 2:55 and 3:30 and was about 1200 basis points between the cash S&P and the Dec futures. The futures went to a discount to cash.

The Dow dropped 100 points during this time frame, which is normal along with the S&P dropping 10, but it's what didn't happen that bothers me. Normally the futures are bought by the program traders as they sell the cash markets, bringing the premium (futures to cash) back to within 150 basis points or so.

It's as if only half of the arbitrage took place. the selling of the DOW/S&P, without the corresponding purchase of the futures . . . . or someone sold real heavy into the buying of the futures by the arbitragers.

I don't have good futures charting, just the $PREM indicator to go by, but I sure can't see any delay or glitch in the feed. First time I've ever seen this senario.

Couple other things strange happened today - some real heavy selling of fixed income issues right at the top with one trader reporting that he didn't see the corresponding bounce in the SM like he would expect, and a lot of buy on close for the larger cap PM stocks.

Strange, strange day with lots of cross currents that don't seem to go anywhere. Makes me a bit uneasy, like what a dog feels right before the ground starts shaking. . .

Maybe Coin Guy is out there or can either confirm or deny some of the things I saw, he tape watches a bit I believe. .


Carl H@Rock: No Fly Zones#8691810/8/02; 15:16:19

The No Fly Zones were not declared by the UN. Only by the US and UK.
NibelungSchroeder resignation requesth#8691910/8/02; 15:18:15


Where did you run across this business of Perle requesting Schroeder's resignation ??? I'd like to get a look at that.

Black BladeRe: GoldnSilver2002#8692010/8/02; 15:23:00

I wouldn't worry too much. October is usually a bad month for PMs. Lower 13 out of 15 years (seasonality). However, the big picture outlook of the global economy is gruesome. Even during the Great Depression the only legal gold proxy was gold stocks. Homestake Mining fell in October and much of the slide in the Depression and yet rebounded to outperform with over 740% gains and spinning off a dividend worth more than the share price just prior to the 1929 market crash. Am I saying that the same thing will happen again? No, I am just saying that a temporary drop in PMs and related shares are no big deal when looking at the deterioration in the global economy. We have gone past the point of no return. as far as the stock markets are concerned and the overall economy is looking more grim all the time. Besides, gold is off only about $12 from its recent highs - that's certainly no reason for anyone to panic. If anything it gives another opportunity to accumulate PMs a bit cheaper. Cheers!

- Black Blade

Gotta go slay a beast and go to the gym.

Socrates964GoldNSilver#8692110/8/02; 15:45:25

What makes us different from tech pushers is that many gold shares are going to have real earnings at these prices ($320) that they didn't have at $250, placing them on low multiples. Also, if you view them as industrial companies, provided that they are unhedged, they are automatically price givers - how many other sectors can you say that of?

Take Murphy's favourite - GSS - will double production and could do 20c per share easily next year without any change in gold price (fed up of reading crap about gold stocks discounting $400 POG)- and it sells for all of $1 - 5x prospective earnings - not 500x. Slight difference, don't you think?

PizzRock#8692210/8/02; 15:48:31

Nice post of the President's position. You and I probably come out of the same decade and mind set. I'm not for war, but if we have to fight one, lets do it on our terms and do it before it gets out of hand.

If you don't stand up to a bully with a big club, he'll just keep on doin what he wants, and you know, if you hit them with a big enough club, they usually just fade away. I think Kadafe got Regan's message pretty clearly. . .

GoldSilver2002: If you can't take the heat, get the heck out of the kitchen.


Socrates964Military Coup looming in Venezuela#8692310/8/02; 15:48:32

Military Coup Attempt Imminent in Venezuela

A military coup attempt against Venezuelan President Hugo Chavez
is imminent, according to STRATFOR sources in Caracas and the
United States. The attempt could be launched within days or even

The Chavez regime already has deployed hundreds of soldiers
throughout Caracas. The government also has begun conducting
raids on the homes of politicians and military officers
suspected of direct involvement in the plot.

Interior and Justice Minister Diosdado Cabello said Oct. 8 that
the deployment of soldiers and light armored vehicles throughout
Caracas since late Oct. 5 is necessary to "defend the
constitution" and prevent the opposition from blocking main
roads and highways if a coup is attempted.

Sources in the Chavez regime are confident that the government
has the firepower to suppress a rebellion, but opposition
sources with direct knowledge of coup preparations say that the
regime's military opponents have the capability to neutralize
Chavez's supporters inside the armed forces.

Confirmation of an imminent effort to oust Chavez comes less
than 48 hours before a planned Oct. 10 protest march in Caracas.
Some opposition groups predict the march will attract between
600,000 and 1 million people demanding Chavez's resignation and
new national elections.

Opposition business and labor groups also have agreed to a one-
day national work stoppage against Chavez, most likely during
the first week of November.

Chavez has said repeatedly during the past two weeks that the
Oct. 10 march is part of a conspiracy to topple him.
Simultaneously, the government has unleashed an escalating
campaign of harassment and intimidation against political
opponents. The Chavez regime also is warning that violence is
likely at the march in an effort to discourage people from
taking part.

Meanwhile, dozens of business owners have been flooded with
anonymous telephoned death threats and warnings that their
companies could be looted and burned if they allow their workers
to march against Chavez or if they shut down their companies to
protest the regime, according to sources at two business
associations in Caracas, including one that represents foreign
companies operating in Venezuela

Belgian@ Kasperjack - posting #86899#8692410/8/02; 15:48:50

I liked your own last and very applicable, sentence : Stay tuned, history is unfolding before our very eyes... !
I do feel the same about it.
Let us not forget that Russia is very closely linked to Germany, already for many years !

Duisenberg stated very explicitely, in today's testimony, that Euroland wants to be totally "independant" on as much levels/scopes as possible. This is becoming very unpleasant for the old US/Europ alliance.

Let us not forget that a rising POG is the most universal indicator of a US$ reserve-currency, losing purchasing power all over the globe. The euro currency was architected to profit (strengthen) from any POG rise !!! This is a very, very, important fundamental difference !

The past war on communism hasn't driven a rift between Euroland, the US and other free parts on the globe. Today, war on oil is not going to have that same solidarity effect between old friends in arms !

When the whole world has to witness Sharon's statement about the killing of 12 Palestinians as being a "SUCCES"...
than we are on the dangerous path of radicalization and polarization, politically spoken.

The same kind of extremism will soon find its way in monetary and economic/social, differences between the euro and dollar block. Euroland is questioning "americanism", more and more. And we are indeed, as you say, on the very beginning of this proces, characterized with so called unfortunate and accidental lapsusses by officials. Blair will not be able to play Lady Maggy's (Thatcher) role during the Reagan era. Lady Thatcher wasn't able to destroy or discredit Euroland in the making. The EMU is still very young of age and therefore super cautious with its dry Gold powder. Thanks Kasperjack.

USAGOLD / Centennial Precious Metals, Inc.A partnership that's right for you.#8692510/8/02; 15:53:16

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Lothar of the Hill PeopleGreetings honorable host#8692610/8/02; 15:56:57

I briefly abandon the quite solitude of my clan's concealed cavern to stand before this great table.

All I can offer our noble host is my gratitude for the glorious prize I have received from his hand--the first silver Maple Leaf now added to the humble hord of my people. A reward for striving in the games past.

But now I must go, to return to my people in the warm potective bosom of mother earth. But I shall return again anon and we will speak of many things.

For I am Lothar of the Hill People.

RockThanks Carl#8692710/8/02; 15:57:21

Thanks for that correction buddy. I wasn't aware that the No Fly Zone was not UN Mandated. It still doesn't change my view on the overall scheme of things however.
Buena Fekasperjack #8692810/8/02; 16:17:17

america prepares to pre-emptively attack germany! they demand regime change! ha ha

what a circus, sanity has left washington

ShermagGoldnSilver2002#8692910/8/02; 16:19:10

I believe Jim Grant had days like this in mind when he said "To achieve the brilliant returns hypothesized by the gold price of $500 or $1,000 five years hence, there is only one prerequisite: You must not sell an ounce or share, even on the pullbacks. Ignore every instinct conditioned during a 22-year bear market."
Sierra MadreChávez and his troubles...#8693010/8/02; 16:26:44

Reminds me of De Gaulle in '68.

"Destabilization" it is called.

When I was in Venezuela right after the attempted coup back in April or end of May, I heard news that a U.S. naval group had been offshore during the attempted coup. I can't know if it was true, or not. But, it's believable.

Saddam Hussein, Chávez - it's all about OIL.


Sierra MadrePizz: WHO is the big bully?#8693110/8/02; 16:33:12

If you don't stand up to a bully with a big club, he'll just keep on doin what he wants, and you know, if you hit them with a big enough club, they usually just fade away.

"Would some god the giftie gie us
To see ourselves as others see us!" Bobby Burns


NibelungFound Schroeder/Perle source#8693210/8/02; 16:35:54

I found the Schroeder/Perle source posted by Kasperjack earlier today. Looks like Perle favors regime change concept over democratic elections.
Sierra MadreNibelung: info on Perle's call for Schroeder resignation:#8693310/8/02; 16:50:19 This email address is being protected from spambots. You need JavaScript enabled to view it. /msg07425.html


Berlin refuses comment on US official urging Schroeder
to quit

Berlin, Oct 2, IRNA (Iran) -- The German government
here Wednesday refused to comment on statements by a
top US official, urging the resignation of German
Chancellor Gerhard Schroeder for his steadfast refusal
to back a US attack on Iraq.

"I don't think I should evaluate the remarks," deputy
government spokeswoman Charima Reinhardt told IRNA,
referring to the latest statements by senior Pentagon
advisor Richard Perle.
"It would be the best thing if he (Schroeder)
retires," said Perle in an interview with the economic
daily Handelsblatt.
Perle added that Schroeder's anti-American rhetoric
during his reelection campaign had 'severely damaged'
US-German relations.
Schroeder has repeatedly ruled out German
participation in a US assault on Iraq, even with a UN
The US official also said Germany's efforts to gain a
permanent seat on the United Nations Security Council
have been 'set back for a whole generation'.

Perle's controversial comments came amid intense
diplomatic efforts by Berlin to ease tensions with
Washington after German Justice Minister Herta
Dauebler-Gmelin compared the policies of US
President George W. Bush to those of Nazi dictator
Adolf Hitler.

PizzSierra Madre#8693410/8/02; 16:50:27

Point is well taken, and appropriate.

If it's any consolation, my personal belief is that within about 2 years (or less), the US is going to have it's "come upins" financially and develope a whole new outlook on our imperialism. Just a hunch, but I don't think we'll be laughing last. .. .

Thanks for the feedback. . .


TownCrierGold awareness in many forms -- Gold coins from the Central Bank of Russia#8693510/8/02; 17:01:51

MOSCOW, October 7. /RIA Novosti/ - The Central Bank of Russia will issue more coins of the Zodiac series, starting tomorrow. ...Up to 20,000 silver [two-rouble] coins will appear in circulation, and up to 50,000 gold [25-rouble], say Central Bank PR.

Of 925 standard, the silver coins contain 15.55 grams of pure silver each. Gold coins are of 999 standard, with 3.11 grams of pure gold.

Every coin bears on the obverse a bold relief emblem of the Central Bank--two-headed eagle, wings down-in a bead frame.

...Though collector's items, the coins are monetary units of Russia for legal circulation.

-------(url for article)-------

Bottom line: Portable property. Good for the well-being of the individual, thus good for the well-being of society.


Sierra MadreGoldnSilver2002: Sorry to see you go! Your post 86916#8693610/8/02; 17:09:21

But, surely,

"We'll meet again!" (That song from Dr. Strangelove)


misetichBanks' Bad Loans Depress Shares, May Slow Economy#8693710/8/02; 17:34:09


U.S. banks lost $21.6 billion on loans in the first half of the year -- more than in all of 1999 -- and they are likely to write off billions of dollars more by yearend, analysts said. London-based consultant Oliver, Wyman & Co. puts North American and European loan losses for this year at $130 billion, up from $110 billion in 2001.

Telecom Loans

The biggest hits are being taken by the banks that lent the most to the telecommunications, cable and energy industries, a group that includes J.P. Morgan, Citigroup Inc., Bank of America Corp. and FleetBoston Financial Corp. The lackluster economic recovery has spread the pain to smaller banks such as Comerica Inc. that finance retail and automotive companies.

``Large losses have been taken, and more are yet to be recognized,'' Fed Chairman Alan Greenspan said yesterday in a speech to the annual ABA convention in Phoenix, Arizona.
Pressure to recognize risky credits sooner has led banks to reclassify loans prematurely, some borrowers say.

J.P. Morgan is among lenders that probably reclassified $7.5 billion in telecommunications loans to nonperforming status in the third quarter, including credits to Rural Cellular Corp., a wireless service provider, according to the Salomon report.

Rural Cellular, whose shares have lost 96 percent this year, said it was surprised to be included in the analysis.

``As we look out ahead, the end of next year is tight, but not impossible,'' said Suzanne Allen, the company's treasurer.

J.P. Morgan, Bank of America and 11 other major U.S. banks will write off $4.9 billion in loans to the telecommunications, cable and energy industries in the next 18 months, according to the Salomon report. The study, which focused on 500 loans to the three industries, excluded any analysis of Citigroup, the second- largest arranger of telecommunications loans at the end of last year.

Growing Loan Losses

J.P. Morgan, the biggest arranger of telecommunications loans, said last month it would quadruple loan losses to $1.4 billion in the third quarter from the previous three months. The bank may break even or report a loss for the quarter, some analysts said.

Citigroup had ``relatively high levels of corporate loan losses in the third quarter,'' Chief Financial Officer Todd Thomson told investors on Sept. 6. The world's largest financial company had about $17.6 billion of telecommunications and cable loans and other commitments at the end of last year, according to Citigroup financial statements. The bank hasn't disclosed loan losses for the three months ending Sept. 30.

In the long term, the regulatory pressure to recognize problem loans should strengthen the financial system, some bankers said.
Lets wait a little while and find out what the loan losses REALLY are -

and lets not forget the off-balance sheet debts

Got gold?

EagleOne(No Subject)#8693810/8/02; 17:41:48

Words of wisdom from one of Americas founding red-necks:

"If you make yourselves sheep, the wolves will eat you."

B. Franklin

CoBra(too)U.S. banks better at assessing risks, Greenspan says#8693910/8/02; 17:43:02

Can't believe that Sir Al really had the 'chuzpah' to express this scam I said Chuzpah!

PHOENIX (CBS.MW) -- American bankers are getting better at assessing and diversifying the risks their credit poses, Federal Reserve Chairman Alan Greenspan said Monday.

In remarks to the American Bankers Association, Greenspan made no comments about the course of the economy or about monetary policy. Two weeks ago, the Federal Open Market Committee held interest rates steady while warning of renewed threats to the recovery.

While many companies got overextended with debt and some found themselves in bankruptcy, the damage didn't extend to the banking system, largely because banks are able to securitize the risks and spread them around the economy, according to the nation's top financial regulator.

"Banks appear to have effectively used such instruments to shift a significant part of the risk from their corporate loan portfolios to insurance firms here and abroad, to foreign banks, to pension funds, to hedge and venture funds, and to other organizations with diffuse long-term liabilities or no liabilities at all," he said in prepared remarks made available in Washington.

"Banks in this country remain quite healthy," despite high rates of bankruptcy, loan charge-offs, bond defaults and equity losses, he said.

Greenspan said bankers obeyed the warnings from the 1997 and 1998 financial crises in Asia and Russia and began to raise their credit standards and manage portfolios to limit their exposure.***

Oh yes, securityzation for one party means insecurity for many. Diffusing liabilities ... neat.

That's why Sir Al also loves derivatives: another instrument of diffusion, deriving its "value" from another underlying financial asset or (in-) security. And the winner is, ... sorry, got carried away - and the beauty is, you can leverage the bet manyfold ... even on some one else's collateral!

Oh well, how come almost all major banks are di-(spersing)ffusing a good chunk of their personell to other diffuse pastures? Diffusion of risk - id est preading the lethal virus of liability around among your favored clients - ultimately seems to catch up with the balance sheet and income statement of the diffiusioner.

Modern Banking, new era usury or the art to diffuse and abuse the trust of the clientele? cb2

NibelungSierra Madre#8694010/8/02; 18:31:35

Thanks for the information. Very interesting development.
kasperjackHenry Fird#8694110/8/02; 18:31:41

Dow Jones Business News
Corporate Bonds Battered, Leaving Ford
Priced Like Junk
Tuesday October 8, 7:51 pm ET

By Christine Richard and Michael Mackenzie

Dow Jones Newswires

NEW YORK -- Sentiment in the investment-grade
corporate bond market
Tuesday was buffeted by concerns ranging from a
possible war with Iraq to
faltering consumer sentiment to worries about utilities'
liquidity, the West coast
dock strike and general auto sector anxieties.

Yield spreads to Treasurys
on some corporate bonds
were wider by as much as
1.00 percentage point on the
day while bonds issued by
Ford Motor Credit Co., the
largest issuer in the corporate
market, were quoted for the
first time on a dollar basis, a
convention usually reserved
for junk bonds.
Stock markets indices are up today while the commercial bond market is screaming danger ahead.

Paper Avalanche@ GoldnSilver2002#8694310/8/02; 18:55:03

I think that you are a shill with a mission to dissuade newbies.

Paper Avalanche

18KThe Difference Between Gold and Paper#8694410/8/02; 19:01:40

Had two experiences today that showed me the difference between gold and paper. Closed one of my last mutual funds today. Called the company and after giving them every scrap of information except the temperature of my behind in the chair so that they knew it was me, I told them I wanted to close the account. No problem, they said, but somehow the update on the bank info I sent three years ago never made it into this one fund account (but did to all the others), so I'll be checking the mail all next week for a check. (I was really tempted to ask them if they were having liquidity problems with all those redemptions...) So for paper the score is - 1 headache.

I also put a couple of month's pocket change into rolls and took it down to the local coin guy (sorry MK) and walked out with a fractional gold eagle. It's sitting here as I write. I can hold it in my hand. It won't rust, tarnish, or do accounting tricks. It has value even if the price fluctuates. And it even gives off a nice glow. So for gold the score is - 1 good peace of mind.

sectorIs Gold "Going Nowhere"?#8694510/8/02; 19:02:45

If you are a Central Banker...Not Exactly

See… the Central Bankers of the BIS and US are losing their treasuries with each passing day. Back in the 1970's William McChesney Martin said he would "Defend the dollar to the last ingot".

It was Federal Reserve bluster. He got a dose of reality and finally quit selling the treasury's gold which led to a 10X rise in the price of gold. His counterparts today will come to the same conclusion.

Because gold sits at $320 to $328 should not be a concern to gold-bugs. Nor should they be worried about HUI and XAU pull-backs [Except to load even more into their retirement or cash accounts in a buy-the-dips tactic].

There is but one force holding gold down. It is the sale, below market prices, of Central Bank gold bullion. To be sure, the COMEX paper game extends the charade but cannot stretch it much further.

The 22% reported Mexican silver production shortfall [July ] is a big clue as to coming events in precious metals. This kind of miss is nearly unprecedented at Penoles and Gruppo who combine to deliver 88 million ounces yearly. There are many speculations about this...none of them good for the cabal.

The Japanese hyperinflation is about to launch as the Koizumi government "Rescues" the big banks with "Public funds". Articles of yen=200 are starting to appear. At yen=133 the Japanese gold bugs will reappear to dash the hopes of stock bulls.

The ECRI is in a vertical shot upward at annualized 25.9%. No inflation? Even the Fed has dissention about future cuts in the discount rate.

As Dave Lewis suggests at this evening, there is a natural interest rate--that rate has been violated and is effecting the natural value of exchange medium [money].

Macroeconomic disequilibrium is worsening by the day...just ask JP Morgan.

Buy more gold down here.

makcumkaOld habits don't die#8694610/8/02; 19:20:28

I found this bit interesting, the "allies" might not be as willing to let go of their own interests to protect the cause of the other.
BlackjackUtility Industry in liquidity crunch#8694710/8/02; 19:20:58

NEW YORK (Reuters) - Allegheny Energy Inc. (NYSE:AYE - News) on Tuesday said it defaulted on some of its key credit agreements, becoming the latest victim of a slump in power trading that has followed the collapse of Enron Corp.

Shares of the utility dropped more than 50 percent, the largest fall on the New York Stock Exchange, after news of the credit crunch raised the specter of bankruptcy for the Hagerstown, Maryland, company.

Allegheny also warned that earnings this year and next would be weaker than expected because of a slowdown in wholesale trading that has hit an industry enveloped by liquidity worries and financial scrutiny by investors and analysts.

"The merchant energy business is currently in a bust and Allegheny appears to be the latest victim," said Paul Patterson of Glenrock Associates.
This industry is in bad financial shape. Debt city.
More companies are on the edge. No recovery here.
Banks should have exposure here to more bad loans.
Can't believe Greenspan was so sure of the strength of the
banking system with all the potential for more bad loans.

silvergolongVenezuela, Iraq, and Japan#8694810/8/02; 19:28:28

Isn't it fascinating that they day that Dubya starts backing off from Iraq is the day that coup preparations begin to crescendo in Venezuela.

I have been thinking a lot about Japan recently. I have been trying to figure out why the japanese banks would buy and hold SO MANY US treasuries. The japanese central bank has practically no gold, only huge wads of US paper. While this may have seemed smart at one time, given the current state of the US economy and securities markets, it is obviously a terrible idea today.

But the japanese are holding some cards. The day of reckoning is at hand, and they have to liquidate some assets to liquefy their financial system. The last thing that the US gov't wants is a ton of treasuries on the market. Maybe the japanese are demanding collateral to keep holding those treasuries. Maybe that collateral is OIL.

Of course Venezuela is chock full of oil, it's right down south, and the whole continent is run by people we can understand, i.e. right-wing thugs. Except, that is, for Venezuela. So is it a surprise that suddenly, in mid-April, a US-backed coup in Venezuela succeeds briefly... only to fall apart within a matter of days. The whole thing blows over. Then a month or two later, suddenly Iraq is all over the headlines. Apparently Saddam Hussein is a bad guy--no, really?--and suddenly we need to get him (and his oil) NOW. But Bush screws the whole thing up, he gets ahead of himself, can't produce any real evidence, annoys our friends, and the russians and chinese start smelling opportunity in the chaos. Whoops. So what happens?

Bush backs off Iraq, and practically the next day, a new coup is "on" in Venezuela.

Boy the timing sure is fishy.

Actually I think we'd be a lot better off if the japanese just said "screw it" and dumped the treasuries. What would happen? Interest rates would soar, a lot of people with floating rate debt (all credit cards and some mortgages) would default, POG would rise dramatically, and the bullion banks would fail. Then what? Assuming that hyperinflation can be kept in check, things would actually start getting better pretty quickly. Corporations would get some pricing power thanks to inflation, and could start paying down debt. They would stop laying people off and might even start hiring again. Bank profits would get slammed, but they'd muddle through eventually. Joe Consumer, as long as he didn't default, would be in a better position to pay off his debts thanks to inflation and renewed job prospects. Gold holders would rejoice, and the evil bullion banks would be dead.

But what if the japanese hold their treasuries? Then they would have to sell their equity holdings. The Nikkei Dow would collapse. US interest rates would drop further, and the US equities markets would collapse. Deflation would mean that heavily leveraged corporations would be unable to service their debts. They would lay people off in droves. Joe Consumer, unemployed, and with stock market investments crushed, would default on his debt and mortgage. Foreclosures would mean bank failures, but the FRB and US gov't would rescue the banks of course. Price of Gold would drop in nominal terms (but would certainly rise relative to other assets); however, bullion banks would be spared destruction at the hands of their gold derivatives, which they could retire with cash instead of gold. In fact the banks would do superbly--just like the did after the 1933 bank holiday--while everyone else would get absolutely crushed (except those holding gold and silver, of course). This would be a worse deflationary depression than the 1930s, uprisings, martial law, and possibly even the permanent negation of representative government could result.

Maybe I've missed something, but it sure seems like we've come to a crossroads, and one road seems to lead to a much worse place. Unfortunately it seems like the current US gov't is determined to take wrong course. Just what you'd expect from the Bush New World Order crowd--pro-bank, pro-elitist, anti-people.

Of course, although it may seem like we run japan, technically that's not the case. What will the japanese do? There is an interesting article at the Forbes website that discusses how the japanese Yakuza are at the center of japan's bank problems, and are forestalling reform. The japanese government is completely cowed by the gangsters, and not for nothing: apparently anyone who tries to get tough with the banks suddenly commits "suicide". The japanese people (oh yeah, them) seem to be a little more awake and aware than the US citizenry, but I have no idea what the man on the street thinks there.

As far as the US is concerned, the people here are sleeping in their shoes. They know what they don't want--war--but they have no idea what they DO want. Bush has been a master of misdirection, and the democratic opposition and population at large are so thoroughly confused that educating them seems almost hopeless. To a large extent we are in God's hands now.

makcumka@ TownCrier, re: Russian Gold Coins#8694910/8/02; 19:32:14

Talked to some of my relatives in Moscow past weekend... Asked about the PM investments. It turnes out that the old communist ways of prohibiting gold or silver ownership, other than art or jewelery, are long gone. But - the gold bullion was offered by the local banks for investment, at various denominations, at the current market price. The people invested. The catch was, the gold bullion in any shape or form is categorized as "the gold fund of Russia", and, therefore, prohibited from export. You may own it but you really don't. And if you want to sell it, you have one and only place to go to: the banks who initially offered the investment. And the banks would gladly purchase the gold back, as scrap, at half the price. Free market for gold ownership?

And one more bit. In the not-so-distant days of "Free Russia" a friend got arrested and charged with "illegal accumilation and posession of silver with intent to distribute". The guy went through the TRASH generated by government-owned factories, which, by the laws of that time, belonged to "the citizens", and collected technical-grade silver from discarded equipment parts. 3 years for little over 100 grams.

makcumka@ 18K#8695010/8/02; 19:40:59

You got off easy with the mutual fund. Tried to close one of my accounts today. They asked me every question possible for "security reasons". Tried to convince me to roll over. And after all failed, I still have to wait for mail to sign a form authorising them to disperse the funds, because a recorded phone conversation is not a good enough proof of my intentions. Oh, the fax was not an option. And the mail takes 7 to 10 business days.

I seem angry. Must go listen to one of those "Sounds of the ocean" tapes.

TopazBonds @Pizz.#8695110/8/02; 19:43:54

A Long Bond Yield below 4.5% is imo curtains for the system.
Effectively anywhere much below that renders Bonds negative to this unfold Pizz.
When the rout begins the psychology of the Market will change to: "why buy today when tomorrow it WILL be cheaper" ie: A systemic shock the likes of which we haven't seen since the Great Depression.
The scant attention paid to the Bond Markets by CNBC etc belies the fact that therein resides the Global Capital Juggernaut of Yesterdays Efforts attempting to eke out a return from Tomorrows Labours. When that return can't justify investment, they will turn to Todays Equivalent - CASH.
Not a pretty prospect.

BlackjackWhy JPM has the Market Panicked#8695210/8/02; 19:50:06

You've got to understand how important the derivatives business is to J.P. Morgan Chase today -- accounting for 15% to 40% of revenue. That's not insignificant at a bank that issued a huge earnings warning on Sept. 18, saying that third-quarter earnings would be substantially below those for the second quarter of 2002. Anything that would threaten that revenue stream would be a big deal.

To understand what might threaten that revenue, you've got to understand something called counterparty risk. When a derivative is created, somebody winds up holding the risk; it's the other party in the transaction that helped someone shed the risk. Counterparties themselves don't hold onto all of the risk. They use more derivatives, in fact, to pass it on to other parties. Part of the science of designing a derivatives portfolio lies in putting together the pieces of the portfolio so that all the risks -- those the bank has assumed and those it has laid off on other counterparties -- net out to something close to zero under most market conditions. That leaves the bank with no risk, as far as the mathematical models can tell, and just the fees earned in passing paper around.

Now, the company that is trying to lay off risk through a derivative certainly doesn't want to pay a fee and take on the potential risk that the counterparty won't have the cash to pay off on the derivative. Rather than just trusting that the counterparty has built its portfolio correctly and laid off its own risk, the derivative customer looks for a counterparty with a solid credit rating. It's therefore critical to J.P. Morgan's revenue that its derivatives-facilitating unit retain a top-notch credit rating. Otherwise, derivatives customers will go elsewhere with their deals.

Before the earnings warning, the J.P. Morgan Chase Bank unit had a credit rating of AA-, well above the rating of most investment banks and most of the corporate customers who do business in the derivatives market.

But after the earnings warning, Standard & Poor's cut the long-term counterparty credit rating at the unit to A+, down one grade, and the short-term rating to A1 from A1+. And Standard & Poor's has the company on credit watch with a negative outlook for further possible credit rating downgrades.

The disaster scenario

From this, I think you can construct the disaster scenario that so scares some on Wall Street. The downgrades are enough to encourage some of J.P. Morgan's customers to take their business elsewhere. That -- plus the other big problems at the bank that are part of the general carnage among investment banks and its portfolio of bad telecommunications loans -- takes another bite out of earnings. Which leads to a further credit rating downgrade. Which leads to more earnings declines. Which leads to more credit rating downgrades. At some point in this process, J.P. Morgan finds that it has more at risk in the derivatives market -- the bank's actual value at risk runs in the tens of billions, according to some estimates -- than cash and … something bad happens. Whether it's an outright failure or simply a near-failure that requires a Federal Reserve-led buyout, the event would certainly send shock waves through the financial markets.
Read the whole article, it sets out the JPM problem
very well. This is mainstream media- Moneycentral

axtest#8695310/8/02; 19:51:24

silvercollectorGoldnSilver2002#8695410/8/02; 19:54:17

I hear your concerns.

I checked the 6 month chart of spot gold. We had 3 cracks at 328 in a month from late May to late June. A crack at 325 in early Sept. and get this 3 cracks in one day on Sept. 24. Our good friend Mr. Privateer was kind to remind me of the Sept. 24 $327.50 high for the day.

Alarming on a short-term analysis?

Now checking the long-term chart from 1975 the 4 year basing at $300 from 1998 is very impressive. Checking 15 years from 1982- 1997 one can see gold floating back and forth from 350 to 450, impressive.

I cringe and cry watching the day-to-day activity. I hope I have the intestinal fortitude (and the time) to wait until we get off this horrid bottom.

Paper Avalanche@ Topaz#8695510/8/02; 19:56:06

Relating to your response to Pizz, I agree 100%. I have already embraced the "why buy today when I am certain that it will be cheaper tomorrow" mentality with respect to purchasing a house. My wife is beating me up to get a house and I now have her convinced to lease a house for at least the next year or two. I believe that I will be able to buy the house that I want today for 50 cents on the dollar in just two or three years vs. today's asking price. Such is the mentality that has gripped Japan for the last decade during which real estate prices have declined at an average rate of 6% per annum.


Paper Avalanche

Paper AvalancheHow about the land of the rising sun.....#8695610/8/02; 20:04:16

If Japan is any reliable indicator, it looks as if this week will turn out to be a carbon copy of last week with a greater final weekly net loss number come Friday at 4:00. At least last Tuesday they were able to gig the market up nearly 300 points. Not so much success today. Yet Japan continues the plunge as I post this.

The paper avalanche has begun.

kasperjackA Small Step For World Bank A Big Boost for Gold#8695710/8/02; 20:06:29 Dow Jones Business News
World Bank's IFC To Invest US$5 Million In
Australia's Sino Gold
Tuesday October 8, 9:41 pm ET

Sydney, Oct. 9 (Dow Jones) - International Finance
Corp., the World Bank's
private sector investment arm, has agreed to invest
US$5 million in Australia's
Sino Gold Ltd., the company said Wednesday.

An unlisted gold miner with
operations in China, Sino Gold
said IFC's investment is by
way of a convertible loan with
a mandatory conversion
provision that is likely to be
triggered within six months of
the company's listing, Sino
Gold said in a statement.

Sino Gold Chairman Nick
Curtis said the company also
plans to list on the Australian
Stock Exchange next month,
and is looking to lodge a
prospectus sometime next
week, with Southern Cross
Equities as the sponsoring
broker of the float.
Hey wow this is interesting move by the World Bank. A vote for the barbaric relic.

Golden BearPaper Avalanche (msg#: 86955)#8695810/8/02; 20:10:42

Hi PA,

I am in exactly the same position with my wife, and have also convinced her that we should do the same - it was mighty hard work... I was early with my bearish rants, but now the economies of the world are co-operating :)

Patiently waiting and watching...


axGold Holding Around USD 318 Spot and Slowly rising#8695910/8/02; 20:21:45

Current trading in spot gold over the last several hours
appears to be holding above the 318 level and gradually
moving higher.

Down around 5 USD from recent levels of 323 those who
have long term accumulation of the metal as their objective,
could view this mild price break as a buying opportunity.

Based on the comments in the Afternoon Gold Report, as
prices move slightly lower, buying in such areas as India
should gradually pick up.

GaleriderHOLDING ON#8696010/8/02; 20:25:26

This is the first time that I've noticed some words from the discouraged on this site. I'm not much for major words of wisdom. But I'm learning more and more from everyone's musings here and I'm not giving up defending the castle. The dark powers are going to break and we are going to have our day in the sun. I like the idea that gold has not got the big notice and exposure, yet. If it holds like this for the next few weeks then I'll be set. All will be in place to profit. I do not like the idea of making a profit from other's misery but the information for PM's has been out there for all to partake of. Few have heeded it. I'm doing this for me, my family, and our security.
TrapperSir Goldnsilver2002#8696110/8/02; 20:28:35

Getting out.

How well I know the feeling as I have been the beliver since the 70's. I have bought thru thick and thin trying to dollar cost average. I have all but ruined my reputation telling my friends gold is going up you will see this time, no this time well I'm sure it is this time. I sort of know how those poor Seventh day adventist felt standing on that hill in their white robes waitng for the return of Jesus.
Gold will NOT rise until we get inflation PERIOD! If inflation will move north of 5% we will see gold move up and not until then. But in the mean time my Gold corp. dividend check just showed up. Like you I will hold my physical coins but I won't expect much until the real powers say it is ok for me to have a small profit, perphaps I will go back into the gold selling business as they make money on both ends, Live small.

Topaz@ Paper Avalanche.#8696210/8/02; 20:28:37

Them Gal's, they like their Bricks and Mortar eh?
If we look at the correlation between Long Bond yields and R/E prices, a 2% drop in yield equates to an increase in valuation of 30% (ballpark) and the only "constant" in the equation is "repayments".
The notion that R/E is a sound investment will be sorely tested as Bond yields ratchet up to 8-12-15% and beyond...those will be the days my friend. Keeping your options open makes good sense imo.

PizzBelgian#8696310/8/02; 20:45:51

What's your read on the European bond market? Same as ours? It appears that some or a lot of US stock money has been going into treasuries. There's a lot of money exiting all major stock markets - are your bond mnarkets going up, topping, or ???

I don't get technicals on European debt markets.

Thanking you in advance for a bit of brain work. . .


SundeckSILVERGOLONG #86953 - Short Positions in Gold and Silver Companies#8696410/8/02; 21:11:39

For your info, Puplava has recently discussed the increasing short positions in gold and silver producers - see the above link and his Market Wrap archives from a few days earlier.



PizzTopaz#8696510/8/02; 21:14:27

What I feel is starting to happen with all the major markets is the thinness of them. With 7 trillion or so out of the US Markets and about the same out of Europe and more out of ASia. The liquidity in the form of bids is not there anymore to hold them up.

It used to be you could unload 100,000 shares of any major stock on a tick or two, now you have to break it up into 1000 share lots or suffer a 20% decline.

this could have been the problem that Bear Stears had the other day, which was a defacto trading halt because their probably wasn't enough bids to cover the blocks and a few heated phone call were made. I don't know.

If the bond market is thin too, and I'm guessing, you can run up the price to whereever on real thin volume as long as you have no sellers, but if a market sell block comes along. . .

A great visual is the scene out of Jurassic Park III when the gal is lying on the cracking glass of their RV that's hanging over a cliff. Move just one little bit wrong, the glass gives way and it's a freefall.

My guess is that 20 Trillion or so world wide has vanished from the banks' and other financial institutions' balance sheets, and that was a big portion of the underpinnings for the financial markets.

Thinking out loud, but as I said the other day, the whole flippin' system only works going up, and there's no plan, program, etc. for an unwind.

Only way it can go is erratic, volitile, and down. . .

Buy gold and tennis shoes, cause I feel even we may have to do a bit of fancy footwork to survive the comming mess.


GoldnSilver2002The government schill returns?#8696610/8/02; 21:25:27

Well Paper avalanche,i met steady at the vancouver gold conference and im canadian'so im a canadian government schill.Im not afraid to ask the questions!Newbies dont need me to get scared ofo gold stocks.Black blade gave the answer i sought.Since i do put my money where my mouth is,i have the right to mock maniupulation so blatant even i can see it.I am not impressed with the efforts of the world gold council and feel we need a leader in this cause.When i look for direction i get "if they do induct the gold cover clause at 529 dump your gold goes its going to 200." JIM SInclair.

Does this make Sinclair a govt schill too?I can see why the average joe is scared off gold and i think its sad.These people, paper avalanche, have been hit with wall st bomb after bomb.They probably suspect gold is manipulated,but i want to make this clear:

"Advertising that the fed and central banks manipulate gold doesnt help drive people to gold." After 22 years i feel some new approach is needed for the public,and i wished to warn them a)physical is better than any paper gold

b)they dont need to sell the house and close every account and buy all gold and sit and wait.Why?Because so far the damn fed has hit gold down everytime it crosses 325.WHy?Coz the p.og is controlled and until she pops over 330 this race hasnt even begun.

IM a govt schill,then send me my paycheck or fire me coz im not that good anyway.

thanks Black blade sometimes just reading more bad news doesnt do the trick,know what i mean?I try to call steady the only goldbug i know, but he never answers the phone and even when he does he says things like "i dont know!".HMMM
so now its wrong to question anything!Wow times have changed no wonder we are in this mess now!

I never said i was leaving i said,im selling my paper and buying physical but not as much as i had of the manipulated form ,,,get it?

Black BladeAnd pigs will fly#8696710/8/02; 21:35:30


You know the feeling you get when your darned checkbook just won't seem to balance. Multiply by a few zillions, and you have some idea of the way Washington is running things these days. It's not just a nightmare; it's that old familiar nightmare we thought we had shaken off years ago: A ballooning federal deficit and its evil twin, a widening trade gap, threaten the U.S. dollar, our financial markets, and our monetary policy. For the first time since 1997, our budget this year will show a deficit probably in excess of $160 billion, in sharp contrast with a $127 billion surplus last year. This dizzying swing–$287 billion–is the largest on record. Why the big change? The drop in tax revenue this year, of over $130 billion, is the sharpest in 56 years, much of it due to layoffs, pay cuts, pay freezes, fewer exercised stock options, and a fall in capital gains.

Black Blade: Of course the alleged "surplus" was nothing but a mirage. Why else could the national debt rise when there was a "surplus". The reason is simple of course – under the Clinton regime they simply stole the funds from Social Security to balance the budget and then falsely claim a "surplus". And yet the national debt kept growing – quite curious. The article does point out that the economy is toast. "Interesting Times"

GoldnSilver2002and P.s whats wrong with my two tier system?#8696810/8/02; 21:42:46

And i expect the worst from the cabal.I see a way out for them that satifies most.The comex closes,forcing gold trade overseas.Because of what happened in america the world demands real physical(1 market) in which there is no manipulation(due to the exposure) and then the american comex re opens and unwinds at a held (fixed) price in fiat.NOw im no genius but is this possible?And if so isnt it someone's duty to warn people fo the coming seperation of the price in (fed manipulated paper gold) and real(physical) gold.You will have to forgive me paper avalanche but i no longer wish to underestimate these guys and how low they will go.If im right the belief in anything paper(stocks included) is worthless but there will always been value in something outside the sytem with no liabilities and universally accepted,regardless of the p.o.g.IM just not holding my breath or running break neck as i slowly accumulate more physical.Yes i believe gold should go up,im just not running around like an idiot anymore telling everyone,only to hear them smugly say "hows the gold doing?" ,everytime the fed hits me for 40 percent on the damn stocks!Ever tried to wake up a dead horse?Well ive been trying for two years.The average joe just thinks no where is safe anymore and who am i to say they are wrong anymore.Cash,gold,food they are all good and so is a roof over my head'something i sold to buy my gold and silver stocks.Wish i hadnt now,but them the breaks.You think im a schill?Says more about you than me!
Sierra MadreThe silliest book ever written...#8696910/8/02; 21:44:13

I have to tell you about this book. "It's Getting Better All the Time - 100 Greatest Trends of the Last 100 Years", by Stephen Moore and Julian L. Simon, published in 2000 by the Cato Institute.

My son sent me this book, maybe he doesn't care for my "attitude", or else it's a peculiar sense of humor, because I never saw such stupidity. This is a monumental work of imbecility. You have to have this book, it's going to be fun to rub it in to your friends who have sneered at you over the years of the gold bear market.

It's all statistics and graphs showing how great things are, and "getting better all the time". This book appeals undoubtedly to those who think in terms of number and not of quality. As Antoine St. Exupery said in "The Little Prince", a small unpretentious but great book: "What is essential is invisible to the eye."

The book reminds me of Candide, the hero of the novel of the same name by Voltaire, who insisted that "this is the best of all possible worlds". There are the wondrous stock market graphs, up to 1999. Delicious!

Lots of graphs showing how wonderful things are and what a great life everyone is living - but no graphs showing DEBT, which has been incurred in paying for all these wonders.

"Where ignorance is bliss
'Tis folly to be wise."

The grasshoppers have had their day. Winter is setting in.

Moore and Sullivan will have to eat their words.


Black BladeEconomy fuels another rise in problem loans #8697010/8/02; 21:46:07


Growing economic weakness has helped fuel a fourth consecutive annual increase in problem loans held by major syndicated lenders, federal regulators are set to report. The full results of the Shared National Credit review are to be released shortly but regulators said the underlying trends point to spreading credit problems for large lenders.

Black Blade: Yes!!! The Shared National Credit review was the name that I was searching for. This committee reports on reserves and banking concerns. This report should be of special interest this quarter. There are many who are concerned about the report even to the point that rumors are floating about that a couple of major banks may be pushed to the wall in coming days – presumably over the results of this "Shared National Credit review".

GoldnSilver2002crooks in our midst....#8697110/8/02; 21:59:47

One last addition,when at the vancouver gold conference'steady and i met a well known stock promoter.She bought us dinner and as i downed the suds she began to tell may interesting stories about a guy named chapman who was well known for stock scams in the past,pump and dump kinda thing.She told us of how all the ceo's dump in october and take profit rebuying at the end of the month at lower prices and all the ceo's know about it.Well now so does the little guy.Screw you ceo's dont tell me to hold the line,while you bail out!There are also many stories and theories on Murphy flying about too.Dear ceo's if you can bail so can i ,"You hold the line boys" ill go get some real gold and be back when im fully armed.Dont believe me?


SundeckGoldnSilver2002 #86916 et al. - Sobering Day - Getting Out#8697210/8/02; 22:01:45

I sympathise with your feelings - investing is a gut-wrenching pastime and a very personal business because every person's financial situation and aspirations are different. I offer several points:

1. I suggest you don't pay too much attention to the day-to-day fluctuations in the POG. I find it reassuring to regularly look at the 5-year and 10-year charts at Kitco (see link). In these charts, day-to-day fluctuations are smoothed out by the 14-day and 19-day moving averages and the current trend is strongly bullish. guarantee for the future, but reassuring for the mid-term investor. Note that the uptrend started long before Sep11 or any talk of war with Iraq. The move is much more fundamental and is linked to the overvalued US dollar.

2. As the US dollar comes off over the next year or two, as is almost a certainty, gold will rise in US-dollar terms. Therefore US holders of physical will stand to profit directly. This may happen slowly or with a rush, or a mixture of both.

3. Producers vary widely in their quality. Their share prices (at least for unhedged companies) are leveraged to the POG. Just as they tend to get wildly overbought as POG surges, so they also tend to get harshly sold as the POG falters. Thus, one stands to profit more from mining stocks, but one has to be able to stomach the fluctuations and that is a very personal thing. People have different "pain thresholds".

4. I am reminded of some of Buffett's advice/wisdom that goes along the lines: If you cannot bear to see the market value of your investment fluctuate by 50%, then investing is probably not for you... ALSO ... It is easier to be sure that the value of an investment will increase over time than to be able to predict when the increases will occur.

Hope these comments are of some help...


Black BladeMarket carnage hits $8.4 trillion#8697310/8/02; 22:16:53


Investors continue to suffer as stocks hit a multiyear low that has cut the total value of the U.S. market to half its March 2000 peak. The Dow Jones industrial average, Standard & Poor's 500 and Nasdaq composite are now at their most depressed levels in half a decade. The slide has brought total bear market losses to $8.4 trillion, Wilshire Associates says. But Monday, the S&P hit a fresh low in unison with the Dow and Nasdaq, leaving it at a level not seen since April 1997. The bear market is now close to becoming the USA's worst ever.

Black Blade: Yikes! - and the worst part is that this lost value could actually double before it even starts to recover. That's $8.4 Trillion gone - poof! - Gone to "Money Heaven". All those hopes and dreams of retirement and college education for the young vaporized to never be seen again. Gone to "Money Heaven".

Sierra MadreA funny thing happened on the way to the Brazilian election...#8697410/8/02; 22:18:01

Am I seeing things or what?

For weeks (months?) we were told what a disaster for Brazil, the election of "Lula" as President would be. Soros went so far as to say that in this world, "Americans, like the Romans, are the only ones who vote. The Brazilians don't vote."

Lula was a total menace.

Then, when it became evident that in spite of all efforts to the contrary, Lula was going to be President, all of a sudden all we hear are soothing words: such as "Lula is not going to be a violent left-winger, of course not; his policy will be of moderation and reasonableness, we can count on that."

Why the change? Evidently, someone has figured out that it's best not to scare the living daylights out of an already frightened public - might end up collapsing JPM.

So, "Lula is OK. Not to worry". I don't buy that at all. I think he will negotiate impossible terms for the foreign debt, and end up repudiating and going into default, saying it's the creditors' greed that makes any other course unacceptable.


TopazG&S2002 and his ilk.#8697510/8/02; 22:25:45

A radical change in your thought processes as they relate to Gold and Price might be in order Sire.
Physical Gold in Possession can be likened to Grandfathers Gold watch, your favourite Rocking Chair, or the Family photo Albums....namely "priceless".

Physical Gold in Possession will never make you RICH!. Let the numbers do others bidding've become immunised. In holding're already WEALTHY!

BlackjackMizuho drops another 12%#8697610/8/02; 22:49:44

TOKYO (Reuters) - Tokyo's Nikkei average fell through 8,500 on Wednesday morning for the first time in 19 years on worries about Japan's faltering economy and possible fallout from a government package to deal with banks' bad loans.

Heavy selling by foreigners was also dragging down tech and auto issues such as Toyota Motor Corp that have a high rate of foreign ownership, traders said.

"I'm surprised that we've come this low. It shows just how bad sentiment is," said Shigemi Nonaka, chairman of Polestar Investment Management, which manages 3.5 billion yen ($28.21 million) of investment funds.

"Foreigners are dumping Japanese stocks and, on the domestic front, fears about the government's plan to crack down on bad loans without an apparent safety net are creating panic."

The Nikkei 225 average was down 1.90 percent at 8,543.14 by midsession, slicing through the 19-year closing low of 8,688.00 hit on Monday and at one point scraping as low as 8,498.46.

The TOPIX index of all first section issues dropped 2.01 percent to 843.53.

Operators have been dreading the Nikkei's fall through 8,500.

Some analysts say latent losses on banks' shareholdings at that level would cause their capital adequacy ratios to drop below healthy levels, which would tighten pressure on the government to draw up drastic measures to stabilize the banking sector.

Shares in weaker banks, which had shown resilience earlier in the morning, were hit by panic selling.

Mizuho Holdings Inc, the world's biggest banking group by assets, plunged 11.86 percent to a lifetime low of 171,000 yen. It was the highest traded issue by value on the first section.

Smaller rival UFJ Holdings Inc tumbled 11.86 percent to 171,000, taking its losses to 47 percent since a cabinet reshuffle last week, when the shock appointment of reform-minded Heizo Takenaka as chief financial regulator signaled a tough government approach to banks' massive bad loans.

Traders said that in the short term, the Nikkei should find support at around 8,400, which marks a 20 percent deviation from its moving average.

"We could be near a historical bottom," said Shuiichi Hida, portfolio manager at Sanyo Investment Management, adding that buyers would likely not emerge until a government package aimed at battling deflation was released some time in the coming weeks.

Without accompanying measures, such as large-scale tax cuts and a safety net for the unemployed, the tougher stance on bad loans would merely increase the deflationary pressures weighing on the economy, analysts say.

Black BladeWhy J.P. Morgan Chase has the market panicked#8697710/8/02; 22:56:25


The complex instruments known as derivatives are meant to hedge risk. But they may raise the odds of a collapse at the storied bank -- and, say many, for the market as a whole. Could a failure at J.P. Morgan Chase (JPM) crash the entire financial system? That's a scenario with credibility on Wall Street, which helps explain the recent trouncing of financial stocks. If you own stocks, you probably don't even want to consider this question. Who wants to hear about the chance that complex financial instruments -- derivatives -- could cause an implosion that could send the stock market reeling? After the pain of the last 30 months, who wants to hear about the possibility that the worst isn't over? You need to understand this potential risk because the stock market is taking it seriously. The financial sector is under such heavy downward pressure lately because some investors feel there's another very big problem out there. And the most commonly mentioned problem is derivatives.

I think you can construct the disaster scenario that so scares some on Wall Street. The downgrades are enough to encourage some of J.P. Morgan's customers to take their business elsewhere. That -- plus the other big problems at the bank that are part of the general carnage among investment banks and its portfolio of bad telecommunications loans -- takes another bite out of earnings. Which leads to a further credit rating downgrade. Which leads to more earnings declines. Which leads to more credit rating downgrades. At some point in this process, J.P. Morgan finds that it has more at risk in the derivatives market -- the bank's actual value at risk runs in the tens of billions, according to some estimates -- than cash and … something bad happens. Whether it's an outright failure or simply a near-failure that requires a Federal Reserve-led buyout, the event would certainly send shock waves through the financial markets Yes, J.P. Morgan Chase is in deep trouble. The bank's basic strategy hasn't worked. Its earnings are under pressure, and more credit downgrades will hurt the company's ability to compete in all its businesses. A crisis at J.P. Morgan Chase would certainly hurt U.S. and probably global financial markets.

Black Blade: Personally I think that the author (Jim Jubak) is way too optimistic. Another amazing point is that this article and the author are found at CNBC. However, this article is quite good and everyone should read it over.

BILLYGBear market losses to $8.4 trillion#8697810/8/02; 22:56:40

brought total bear market losses to $8.4 trillion (from message below)

Is this the right number?????


Or do I need more zeros??? Thanks Bill

darkhorse@BillyG#8697910/8/02; 22:58:37

You need three more...
Gandalf the WhiteYES SIR there BILLYG !!#8698010/8/02; 22:59:31


Black BladeOne more blow to earnings #8698110/8/02; 23:06:47


A proposed accounting rule change all but ends the options expensing debate; brace for lower EPS. Forget the debate on whether options should be expensed -- thanks to a proposed rule change from the Financial Accounting Standards Board, companies may have no choice but to grin and bear it. Proponents of expensing, including Alan Greenspan and Warren Buffett, think options should detract from net income just like other forms of compensation. Critics include CEOs who don't want to see their companies' net income instantly deflated.

Black Blade: Damn straight! I usually agree with Warren Buffett and yet rarely agree with Alan Greenspan. However, everyone is on the same page here. Options should be expensed. The result of course will be lower earnings but at least these will be more honest earnings and not the wild hallucinations of some accountant trained at the school of creative accounting (i.e. Arthur Andersen) and some greedy CEO looking for that boost in performance bonuses.

BlackjackJapan may nationalize some big banks#8698210/8/02; 23:09:56

Tokyo, Oct. 9 (Bloomberg) -- Mizuho Holdings Inc. and UFJ Holdings Inc. led drops in Japanese bank shares on speculation their loans to problem borrowers may put them first in line to be seized by the government.

Mizuho, the world's biggest bank by assets, and UFJ, Japan's fourth-largest lender, both fell as much as 30,000 yen, their daily limit, to record intraday lows of 164,000. Both lenders traded 7.7 percent lower at 179,000 on the Tokyo Stock Exchange as of 1 p.m. Japan time.

Both Japanese and foreign investors are concerned about Japan's banks, which they say may have more bad loans than the official estimate of about 52 trillion yen ($422 billion). The government may need to seize the most troubled lenders to reform and revive the industry, said Richard Medley, chairman of Medley Global Advisors, a New York-based hedge fund adviser who previously worked for George Soros.

``There may have to be a nationalization of a (major) bank or two,'' Medley said. ``The most important thing that can get done now is to support Minister (for Financial Services Heizo) Takenaka in his effort to get the bank situation dealt with as rapidly as possible.''

Takenaka, who was last week named to his post, has said Japan will consider injecting public funds into banks. Finance Minister Masajuro Shiokawa has said Japan must use taxpayer money to ``rescue'' the industry.

Takenaka is scheduled to hold a monthly press briefing on the economy at 4.15 p.m. Tokyo time, in his capacity as minister for economic and fiscal policy.
Nationalize banks like Mizuho? WOW That would be expensive.
Since our bonds seem to be topping out, maybe this would be
a good time for Japan to sell some US Bonds to finance the
bank clean up?

goldquestGoldbugs. Not The Time To Panic#8698310/8/02; 23:11:12

Scroll down to Crash Script.
If you are not positioned in PMs by now, in a few days, it could be to late.

BlackjackHuge drop in Japan machinery orders#8698410/8/02; 23:21:50

Tokyo, Oct. 9 (Bloomberg) -- Consumer confidence in Tokyo fell for a second month in September as unemployment hovered near a record high and the economic outlook worsened.

An index measuring consumer confidence in the capital, where a tenth of Japanese live, fell to 42.6 last month from 44.1 in August, government figures showed. A number below 50 indicates more people are pessimistic about the economy than optimistic.

Consumers are reluctant to spend as companies such as Fujitsu Ltd. cut staff because of falling overseas demand. Japan's economy, which grew for the first time in more than a year in the second quarter, may shrink as early as next month, a report earlier this week showed, cutting short a recovery from the third recession in a decade.

``The economy is already deflating,'' said Huw McKay, an economist at Westpac Banking Corp. in Sydney. Consumers ``aren't feeling good about things right now and they shouldn't be, either.''

An index of leading economic indicators -- which includes job offers, machinery orders and other measures of future activity -- fell to 44.4 percent in August from 70 percent in July, a government report showed on Monday. It fell below the 50 percent level for the first time in eight months, indicating the economy may contract in three to six months

Job Cuts

The jobless rate held at 5.4 percent for a fourth month in August, just shy of December's record 5.5 percent. Economists say it may jump to 6 percent by the March 31 end of the fiscal year as more companies fire workers to cut in costs or go bankrupt.

Fujitsu Ltd., Japan's biggest business computer maker, slashed more than 5,000 jobs in July and August because it received fewer orders as the U.S. economy slowed. Mitsubishi Cable Industries Ltd., which makes communication equipment, last month said it would shed 670 jobs, or about 30 percent of its workforce.

Economists say consumer sentiment may worsen with the government's recent decision to speed up bad debt write-offs. Prime Minister Junichiro Koizumi in the past week has said Japanese banks will complete the write-off of $430 billion in bad loans by the year ending March 31, 2005.

More bad debt write-offs mean banks may cut lending to weak companies, increasing corporate bankruptcies and unemployment.

An index measuring confidence in the labor market fell to 33.9 from 35.8 in August. The income index fell to 40.6 from 42.1, the report from the government's Economic and Social Research Institute showed.
Japan looks headed into a depression. Perhaps Japan will
be the trigger for events.

Black BladeJapanese Banks’ Gangster Rap#8698510/8/02; 23:35:18


People can be forgiven for getting cynical. Japan's government and banks have lied so often about the amount of bad loans in the system that nobody really knows how much there is. Private-sector estimates of the total range from $400 billion to $2 trillion. Since 1992, Japan has announced at least ten financial "rescue" plans. All have been dashed into futility by the same treacherous reefs: corrupt links between ruling party politicians, zombie corporations, bureaucrats and organized crime syndicates.

Black Blade: The question is: which ones are the crooks? Better yet – which ones aren't crooks? Sound a lot like major US banks. Hmmm…

BTW, we know about cozy relations between politicians and banks. Robert Rubin got a sweet payoff with a nice lucrative position at Citigroup and today Senate Banking Committee Chairman Sen. Phil Graham announces that he will get a sweetheart deal with UBS Warburg, probably for "a job well done". Now that I think about it, his wife Wendy was a director on the board of Enron. I think I went into the wrong career path - nah! I would hope that I would take the high road. Hmmm...

BlackjackEurope starting to look like Japan#8698610/8/02; 23:36:00

Germany's third-largest listed bank fell more than 7% percent to 5.04 euros after S&P said that the fall in the value of Commerzbank's equity reserves would weaken its financial flexibility.

At the same time, there were signals that rival banks were beginning to grow cautious about doing business with Commerzbank and other German banks, particularly in the complex field of credit derivatives.

But a Commerzbank spokesman said that the bank's relations to other derivatives traders remained normal. "There is not a disturbance in this market," he said.

Fiat's Italian plants are likely to bear the brunt of cost-cuts

Italy is awaiting details of a restructuring plan aimed at turning around Fiat's once-mighty car-making division.

The plan, due to be presented to unions later this morning, is rumoured to involve the loss of some 8,000 jobs, mostly in Italy.

Fiat shares fell by more than 6% on Tuesday, the latest sign of the collapse of investor confidence in the firm, which has seen domestic demand drop by one-fifth this year alone.

Fears over the effects of restructuring have already caused unrest at Fiat's Italian plants, especially those in Arese near Milan, and Termini Imerese in Sicily - both reportedly targeted for closure or partial closure.
Thats funny, because here in the US we don't have any big
bank problems, ask Greenspan.

BlackjackNikkei down 2%#8698710/8/02; 23:40:50

Nikkei broke 8,500
When will adequacy problems force
Japan to nationalize? Wonder how the
markets will react.

TownCrierExemplary Gold Fields mgt brings "sphere of influence" to China gold#8698810/9/02; 00:05:53

Bloomberg HEADLINE: Gold Fields, Three Banks Buy 40% of Sino Gold's Stock

Sydney, Oct. 9 (Bloomberg) -- Gold Fields Ltd., the No. 4 gold producer, and three banks paid US$20 million for a 40 percent stake in China's first foreign gold miner Sino Gold Ltd. before an initial share sale next month.

...Sino Gold was created in 2000 after being spun off from the Chinese government-owned Sino Mining International Ltd. Sino Mining International and Refco Group Ltd. will each retain 16 percent of the company, Sino Gold said.

------(click url for article)-----

Could you ask for a better partner in the region as China's liberalized gold market takes form? Three cheers.


BlackjackHousing Boom may be at an end#8698910/9/02; 00:10:50

New York, Oct. 9 (Bloomberg) -- Shares of U.S. homebuilders are slumping. The declines suggest the housing boom has peaked, according to some investors and analysts.

While new home sales and orders reached records and builders such as Lennar Corp. and KB Home have said earnings are rising more than projected, the broadest index of U.S. homebuilders dropped to its lowest level in 10 months this week.

Rising foreclosures, mounting unemployment and declining consumer confidence threaten to curb the industry's growth, some investors said.

``There are a lot of portfolio managers out there who believe the consumer is on his last leg, that he's overextended, and it's time to sell,'' said James Grefenstette, co-manager of the $650 million Federated Growth Strategies Fund.

Topazmillions and millions @BillyG, Gandy, all.#8699010/9/02; 00:14:51

A Billion in the US = 1 + 9 noughts whereas, in Europe/UK its 1 + 12 noughts.
A Trillion in US = 1 + 12 noughts and in Europe it's 1 + 18 it any wonder these Multinationals get confused with their accounting...poor buggers!
A GOOGOL is equal to 1 + 1 million noughts...Townie will no doubt get used to this one as the Hyperinflation kicks in.
...meanwhile I'm working on my first confusion here.

Mr GreshamExtra Innings#8699110/9/02; 00:16:54

{Well, I've hit Submit 4 times now; let's see if this time takes}

I know how you feel: this game just goes on and on. I guess I'm surprised that they've managed to hold on this long, above 300, and that other potential wealth savers are having such a long, long opportunity to get on board sub-350 (and still not taking it).

It's like the other side gets this long strike count, "uh, 2 strikes, Ok, now, uh, 2 strikes...yeah...or was that 1?", until they get a chance to make contact. We, on the other hand, have to throw every pitch right in on dead center. "Ball 1 -Ball 2 -BALL FOURRRRR!!!! Yerrrrr on!" Head's still spinning.

Check me on this, but isn't that Ump the one they borrowed over from that "other" league? Hmmmm... No wonder everytime the public looks over, they see a bunch of chumps gettin' hammered again.

"Bunch a losahs! Where'd ya park da car -- let's get oudda here!"

But still, we keep drillin' 'em in there, keep making contact, and stay in the game. Razzle-dazzle (or stealing signals from center field) may win a game or two; fundamentals win the pennant.

Black BladeAsian Markets Search for a Bottom#8699210/9/02; 00:18:08

Yep, Asian markets are going negative and the Nikkei 225 is tumbling into new lows.

- Black Blade

BlackjackUS Consumer Confidence Tanking#8699310/9/02; 00:19:21

NEW YORK (CNN/Money) - Consumer confidence sustained one of its biggest drops on record in 16 years of polls in the week ended Oct. 6, falling to its lowest level since January 1996, according to the ABC News/Money magazine Consumer Comfort index.

The ratings of the national economy sank sharply as well, tumbling to their worst level in eight and a half years.

The ABC News/Money magazine Consumer Comfort index, based on these gauges, lost five points last week to -20 on its scale of +100 to -100.

Expectations, measured separately, also have worsened: Forty-eight percent now say the economy's getting worse, up 12 points in the last month and the highest level since November. Economic pessimists now outnumber optimists by more than three-to-one.

In the latest survey, 27 percent of Americans said the U.S. economy is in good shape, down three points from the previous week. The best was 80 percent on Jan. 16, 2000, and the worst was 7 percent in late 1991 and early 1992.

The study also concluded that 55 percent of Americans rated their personal finances as excellent or good, down 2 points from the week ended Sept. 29. The best showing was 70 percent in the week of Aug. 30, 1998. The worst rating was 42 percent on March 14, 1993.

Also, 38 percent of the survey participants said it's an excellent or good time to buy things they want and need, down two points from the previous weekly poll. The best was 57 percent from the week of Jan. 16, 2000. The worst happened in the fall of 1990 with 20 percent.

The ABC News/Money magazine survey represents a rolling average based on telephone interviews with about 1,000 adults nationwide each week. This week's results are based on 1,024 interviews in the month ended Oct. 6, 2002 and have an error margin of plus or minus 3 percentage points.
Santa's Elves might pull a work slowdown.

BlackjackWorlds Largest Accounting Firm to face Criminal Charges#8699410/9/02; 00:28:00

New York, Oct. 9 (Bloomberg) -- New York prosecutors are considering criminal charges against PricewaterhouseCoopers LLP auditors who reviewed compensation for the indicted former chief executive of Tyco International Ltd., people familiar with the situation said.

Manhattan District Attorney Robert Morgenthau is examining whether Pricewaterhouse auditors based in New York and Boston broke the law when they failed to disclose that a proxy statement didn't include a $33 million bonus paid to then chief executive L. Dennis Kozlowski, the people said. Kozlowski was indicted last month for looting Tyco.

Prosecutors are considering using the prospect of an indictment as leverage to persuade the auditors to testify against Kozlowski and other indicted former Tyco executives, the people said.

``An auditor at Pricewaterhouse represents a particularly dangerous witness,'' said George Washington University law professor Jonathan Turley, a white-collar crime expert. ``A defense attorney for the auditors would probably be exploring who they can offer up for a generous deal.''

Rick Scalzo is the lead Pricewaterhouse partner for the firm's Tyco account, according to company filings. Scalzo, based in Boston, did not return phone messages left at his office for comment on whether he had been contacted by the district attorney's office.

The Wall Street Journal said Sept. 30 that prosecutors' interest in Pricewaterhouse's audits of Tyco ``suggests they now may be attempting to make a criminal case'' against the accounting firm, the world's largest.
Yes, an auditor, especially a scared one, would make a dangerous
witness! More scandals to come, stay tuned.

TownCrierTopaz, technically speaking...#8699510/9/02; 00:31:23

A googol as we know it here in the States is 10^100, that is, 1 followed by 100 zeros... like the Pied Piper marching down the street with nearly eight dozen daytraders behind him.


BlackjackUS Auto sector downgraded, boom over?#8699610/9/02; 00:43:00

DETROIT (Reuters) - Shares of Ford Motor Co. F.N sank to their lowest point in more than 10 years on Tuesday and its bonds plunged after Credit Suisse First Boston downgraded the company and halved its price target.

It was one of the worst days for the world's No. 2 automaker and for Bill Ford Jr., great-grandson of the family-controlled company's founder, since he took over as its chief executive last October.

The whole U.S. automotive sector, which CSFB downgraded across the board, traded sharply lower on the day, amid fears about the outlook for sales and the shaky U.S. economy. Shares of Delphi Corp. DPH.N and Visteon Corp. VC.N -- the top two U.S.-based automotive suppliers -- were among those pummeled after CSFB cut their specific ratings.

Ford took the biggest hit among the major auto industry players, however, after CSFB, citing concerns about its ability to maintain its investment grade credit rating, said it was slashing its price target for the automaker to $10 from $20.

Ford and its finance arm are the largest U.S. issuers of corporate debt and a downgrade to junk status for the 99-year-old corporate giant would be nothing short of disastrous, industry analysts say. The total debt of the company, which is struggling to implement what some analysts deride as a lagging turnaround effort, stood at $157 billion at the end of 2001.

Fears about Ford's credit rating have been exacerbated by mounting concerns about its pension fund liabilities and by worries about the profitability of its luxury car division, which includes Volvo, Land Rover and Jaguar, CSFB said.
Autos and Housing look to weaken soon.
Notice the mention of pension fund liabilties.
How about Soc Sec for the Feds?
Boomers retire soon.

TownCrierBelgian brought this to your attention#8699710/9/02; 01:02:08

Q&A isn't posted at this hour, but the following is a key element of the speech:

"At this juncture it is of utmost importance that all macroeconomic policies remain oriented to the medium term, with all players fulfilling their responsibilities. Monetary policy will continue to provide a reliable anchor for the economy, especially in an environment characterised by high uncertainty and fragile confidence. This implies focusing on the maintenance of price stability over the medium term.

"Let me make a remark in this context, linked to comments which arise with a certain regularity in public debate and which argue that monetary policy should follow a different orientation, an orientation in which price stability is not the overriding objective.

"I should like to recall in this connection the fundamental and yet simple principle that monetary policy should not be overburdened with objectives that it cannot fulfil. It is well established that monetary policy can only control price developments over the medium term and cannot have an impact on output beyond the short term. Monetary policy can certainly not heal structural problems in the economy, such as those underlying the high level of unemployment.

"In line with these principles, the Treaty establishing the European Community has assigned the ECB the primary objective of maintaining price stability. In the end, strictly following this mandate, with the appropriate medium-term orientation, is the best contribution the ECB can make to supporting sustainable non-inflationary growth and a high level of employment in the euro area."

------(speech at url)-------

You can be sure the exporting nations with dollar-denominated reserve assets are listening with rapt attention, also watching as actions on both sides of the Atlantic speak louder than words.

With gold in hand you don't have to suffer the full fate of the dollar as time unfolds and market discipline is no longer suspended (as it currently is in the weathering of this immediate financial crisis).


TopazTownie#8699810/9/02; 01:02:09

I stand corrected Sire, my reference was CNBCAsia.....silly me! (wink)
Black BladeMarket Indicators#8699910/9/02; 01:04:58

US market index futures point to a negative open on Wall Street. The USD is negative, Gold is positive, and petroleum prices are gaining. Still, it looks like a bit of "entertainment" is on tap for tomorrow.

- Black Blade

TownCrierI reckon this addition would have been helpful...#8700010/9/02; 01:07:00

The speech quoted moments ago was ECB President Duisenberg's testimony before the European Parliament's Committee on Economic and Monetary Affairs.


Black BladeNew Era of Oil Is Coming#8700110/9/02; 02:02:04

New Era of Oil Is Coming, Energy Analyst Tells Buffalo, N.Y., Audience


Oil industry analyst Charles T. Maxwell sees fundamental changes coming to the world's energy markets -- and it has little to do with what happens to Saddam Hussein and Iraq. Instead, it's all about oil supplies and production levels -- and the way Maxwell interprets them, it could mean a new era of higher prices, tighter supplies and renewed conservation is just a few years away. "Something extremely dramatic and something extremely important is heading toward us," Maxwell, the senior energy analyst at Weeden & Co. told members of the Buffalo Society of Securities Analysts at the Saturn Club on Monday. At the heart of Maxwell's forecast is his belief that worldwide oil discoveries peaked 38 years ago, in 1964, while consumption has continued to increase. By 1988, worldwide oil consumption had matched the amount of petroleum that was being discovered in a given year and now, the world uses almost twice as much oil as it finds each year. The result is what Maxwell believes will be a new era of oil pricing and oil use, shifting from long periods of oversupply and low prices to a world where prices steadily rise, the leverage of the nations that belong to the Organization of Petroleum Exporting Countries grows and conservation takes on a whole new significance. Maxwell estimates that world oil production will peak somewhere around 2015, but the output of non-OPEC nations will top out much earlier, around 2005 to 2007, increasing the world's dependence on the cartel. "We're going to see a fundamental change in the pricing of oil and it will begin moving upward," Maxwell predicted. "I believe we will find OPEC beginning to put real pressure on the price of oil."

Black Blade: Indeed, the exploration and development of hydrocarbons has not kept pace. New discoveries are smaller and more costly. The higher costs of energy will hit the economy like a ton of bricks. Actually the authors estimate of world oil production peak at 2015 is at the upper end of the range.

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Black BladeOPEC Crude Basket Falls Into $22-$28/Bbl Target Range #8700310/9/02; 03:19:33


LONDON -(Dow Jones)- The value of the Organization of Petroleum Exporting Countries' basket of seven crude oils fell below $28 a barrel Tuesday, OPEC's official news agency, Opecna, said Wednesday. The basket price's fall to an average price of $27.98/bbl Tuesday compared with $28.23/bbl Monday resets OPEC's 20-day clock on any possible output hike.

Black Blade: OPEC production clock is reset. So no increased production even though oil inventories are expected to fall sharply (already at 20 year lows).

BlackjackInsurance rate for Yemen shipping triples#8700410/9/02; 03:23:02

Al-Mukalla, Yemen, Oct. 9 (Bloomberg) -- Insurance companies more than tripled rates for ships traveling to Yemen after an explosion on a French oil tanker in Yemeni waters on Sunday, the country's transport minister said.

``The increase is illogical,'' said Saeed Yafai, the official Saba news agency reported. ``This is another harm to Yemen along with the great environmental damage'' done by the oil spill, he said. The report didn't give details of the rates.

Three explosions occurred on the right side of the Limburg oil tanker after a fishing vessel rammed the ship as it approached an oil-loading terminal near al-Shihr in the Gulf of Aden, the tanker's chief officer said yesterday. Investigators from France, Yemen and the U.S. are trying to determine whether the explosion was an accident or the result of an attack.

Hunt Oil Co., a closely held exploration and production company controlled by Dallas oilman Ray Hunt, and Calgary, Canada- based Nexen Inc. are the largest operators in Yemen, according to the Paris-based Arab Petroleum Research Center.

Los Angeles, California-based Occidental Petroleum Corp., Exxon Mobil Corp. and France's Total Fina Elf SA are also active in Yemen, which last year produced 440,000 barrels of oil a day, Arab Petroleum said in its 2001 annual directory.

Yemen exports its oil from three terminals at Ras Issa in the Red Sea, and at Rudhum and al-Shihr in the Gulf of Aden, according to the center. Al-Shihr is about 450 miles east of Aden, where a bomb attack against the U.S. warship, USS Cole, killed 17 sailors two years ago this Sunday.

The French supertanker, which has a capacity of 2 million barrels, was carrying 397,000 barrels of crude oil from Saudi Arabia when the explosions and ensuing fire occurred.

The resulting oil slick, which now covers 500 square kilometers, is threatening the livelihood of more than 6,000 fishermen, the state-owned Saba news agency reported.

BlackjackGerman banks plan to purchase their own shares#8700510/9/02; 03:26:45

Frankfurt, Oct. 9 (Bloomberg) -- German banks should take advantage of the plunge in stocks to repurchase their own shares, European Central Bank Chief Economist Otmar Issing said.

Germany's benchmark DAX 30 index has shed half its value since January and was the second-worst performing index worldwide last quarter. Commerzbank AG, Germany's fourth-biggest lender, has fallen 70 percent this year on concern about bad loans.

``It would be an exaggeration to talk about a banking crisis, but the situation can certainly be called dramatic,'' Issing said in an interview late yesterday. Banks ``should take the opportunity to buy back their own shares at these levels.''
Then if the stocks keep falling they will lose even more money.
They should buy PMs!

Black BladeIndia Festive Buying Season, Lower Price Boost Gold Demand #8700610/9/02; 03:29:47


New Delhi, Oct. 9 (Dow Jones) - A fall in international gold prices ahead of the Hindu New Year Diwali in early November and the wedding season starting next month is stimulating demand, market participants said Wednesday. Gold buying in India has picked up since Monday, after the end of "Shraad," an annual two-week period that many Hindus consider inauspicious, market participants said.

Black Blade: As I said would happen. They aren't crazy. The WGC already reported that gold buying has picked up in India.

CoBra(too)ECB's Chief Economist Othmar Issing urges#8700710/9/02; 03:36:18

German Banks to buy back their own shares. Interesting proposal amidst the rout in bank and insurance stocks. Though, where to find the funds? cb2
BlackjackIt costs more to borrow now for corporations#8700810/9/02; 03:40:35

New York, Oct. 9 (Bloomberg) -- Corporate bond yields have been pushed to record premiums over those of Treasury securities by investors concerned falling profits have undermined borrowers' creditworthiness.

Yields on investment-grade corporate bonds reached 2.51 percentage points over Treasuries, the widest in at least 10 years, according to Merrill Lynch & Co.

Ford Motor Co. and AOL Time Warner Inc. are among the companies whose bond premium, or spread, over Treasuries is at record levels. With three companies lowering earnings forecasts for every one raising estimates this quarter, investors say they are increasingly concerned about companies' ability to pay debts.
Thats the question, can all this debt be repaid.

BlackjackExperts say it was terror attack#8700910/9/02; 04:26:15

Ever since the second week of September, American special forces are reported to have been fighting terrorists amid the stark cliffs and narrow ravines of this precipitous region of Yemen. Little is known about the state of combat, but it is believed that American troops are facing the same sort of difficult terrain as they do in Afghanistan, where locals play an easy game of hide and seek.

Al-Qaeda's decision to go for an oil tanker may have been a stroke in this secret battle. Yemen is also home to a strong Iraqi military intelligence presence, although both Yemeni and US officials try to keep this dark.

The terrorists' latest success, if indeed it is their handiwork, must have set some red alarms flashing for US planners of the Iraq war, who must guard against the possibility of disruption to Gulf and Middle East oilfields, terminals and seaways or an onslaught of seaborne terror. As a preventive measure, the US navy is blockading the mouth of the Shatt al-Arab, Iraq's only outlet to the Persian Gulf. The fact that Sunday, al-Qaeda forces in Yemen struck at a seaborne target which Iraqi commandos are unable to reach may be no coincidence, given the operational collaboration fast developing between Baghdad and the Islamic terror network.

The investigation of the Limburg affair and its fateful ramifications is only just beginning. But the relaxed official response to a terror attack on a main oil traffic highway bodes ill for the prospect of stability in global oil markets in the event of a US-led war against Iraq.
Captain, one of those 1,000lb bombs we carry around the
hull of our supertanker accidently exploded!

Belgian@ Pizz : euro-interest rates - #86963#8701010/9/02; 06:33:29

Benchmark German 10 yrs bund : 4,30% and still declining (lower IR). A projected 4% is a technical possibility.
The bonds haven't fully topped out, yet. IMO, IRs have to be kept low/lower, everywhere, for some time to come. "NOT" to support an economic relance but to support banks/pension-mutual funds/insurance and tutti financial frutti. When there are no more confetti-rains, carnaval stops.
Deutsche Bank (and others as well), minus another 4% today.

But low/lower IRs for an extended period of time are a rainbow-cure. Good for some, bad for others and therefore strongly neutralizing net-positive effects. In other words : WORTHLESS !

The Victorianwhat is going on with the price of silver?#8701110/9/02; 06:35:10

Silver is down this morning to $4.29. Every day I think it can't go lower and it drops another 5 cents. Did someone just drop 50 million ounces on the market? Usually silver and gold move somewhat in tandem but they have completely separated lately and I'm curious to learn why.
Paper AvalancheChina's Gold Market#8701210/9/02; 06:46:17

I read earlier this month that the Shanghai Gold Exchange would be opened officially around the middle of this month. Has anyone heard anything to confirm this or if there has been any new delay. I have been waiting for this thing to open for the better part of this year and it always seems that they delay it's final opening by another quarter at the last minute.

Have a great one!

Paper Avalanche

BelgianEuroland's expansion !?#8701310/9/02; 07:40:17

Euroland is expanding to the east with another 10 eastern countries to join before 2005. This is going to cost a lot of confetti (estimates=40 Billion as a starter). More euro in circulation against the same amount of Gold-reserves = possible higher valuation for Gold, whilst recycling part of the existing, obsolete, dollar-reserves into euro ???

Euroland is organising the expansion of its economy, within its enlarged borders and becomes therefore less dependable from western trade.

WaveriderAbbott Labs to Cut 2,000 Jobs #8701410/9/02; 07:40:46

"Abbott Laboratories plans to eliminate about 2,000 jobs, or 3 percent of its global workforce, to generate as much as $100 million in annual savings after manufacturing glitches boosted costs."

PizzBelgian#8701510/9/02; 07:42:52

Thank you kind Sir.

Banks are in the ambulance heading for the emergency room. AG confirmed as much with his US banks are solid talk. Markets are rarly wrong when allowed to float on the winds of true supply and demand.

I'm just starting to feel some safe haven buying of PM shares. The sheeple will move there first before the metals. Major upside breakout within a few weeks.

The PM shorts have been and are trying to use the seasonality to cover, but it appears that the strong longs are and will be buying one last time cheap.

Going to be lots of volitility in the paper markets. The banks appear to be pulling capital out of their trading rooms and the program trading is starting to get sporatic.

Just my opinion, not investment advice


WaveriderAT&T Cable-TV Unit to Cut 1,700 Jobs #8701610/9/02; 07:50:57

"AT&T Corp.'s cable- television unit, AT&T Broadband, will cut 1,700 jobs, or 4.3 percent of its employees, as part of a plan to combine with Comcast Corp. The positions will be eliminated at AT&T Broadband's headquarters in Englewood, Colorado, AT&T and Comcast said in a statement."

Waverider: BTW - this is the second morning in the past few weeks that the early morning CBC market report has been conveniently "not available"...hmmmm...better no news than bad news?

mikal@The Victorian#8701710/9/02; 07:59:20

"Usually gold and silver move somewhat in tandem but they have completely seperated lately and I am curious to kow why." Ag appears to be in trouble but isn't. Here's why. Both metals have been in a slow rangebound downtrend. But Ag exaggerates gold's moves, in a wider range. Yesterday gold moved below $320 support, so it wasn't surprising to see Ag down more than it has been for a long time -$.08. Large commercial banksters dumping contracts to clear out stop loss orders at key levels, banish weak longs, to permit short covering purchases at lower levels and to delay the PM bull. Ag shows greater volatility in the exaggerated moves above and below $5.00/ou. What else to expect, but the pitfalls and rewards of a more outgoing and flashy lifestyle, independent of her home-based, vault-anchored gold companion. Compare to the way a revolving moon mirrors a temporary, changing reflection of the sun. As the working man's gold, Ag spending money should enter and leave your pocket often in order to be a victorious Victorian.
mikal@The Victorian#8701810/9/02; 08:08:11

Correction, that should read: "As the poor man or working man's gold, Ag spending money should enter and leave your pocket often in order to be a victorious Victorian."
Golden BearCNBC trashing Abby Jo...#8701910/9/02; 08:22:43

Ted David just stated that Abby Joseph Cohen continues to refuse to be interviewed by him.

Joe Kirnan replied that it's because of David'd investor advocate stance...

David replies that if she can't stand the fact that she's going to be asked tough questions about continuously being wrong, then she doesn't deserve to be on air...

The Bear is biting hard...

RockNightmare on Wall Street#8702010/9/02; 08:25:32

Early morning trading is a rough ride today. Its the middle of earning season with a slew of negative notes this morning thats whats moving the market. General Motors is trading its lowest in five years and looking at the Ford chart they too are at five year lows. Cash flow is a real issue at the NYSE. In a word....grim.


RockGoldenbear#8702110/9/02; 08:29:30

I heard that interview with Ted David and Joe Kirnan, the cowards and liars in the likes of Abby Jo don't want to be questioned about their wrong stock predictions. Abby Jo has no more creditability.


Tommy PThis should help this turbulent world!!!#8702210/9/02; 08:49:27

Military Coup Attempt Imminent in Venezuela Oct 08
A military coup attempt against Venezuelan President Hugo Chavez is imminent, according to STRATFOR sources in Caracas and the United States. The attempt could be launched within days or even hours.

The HoopleRock,re: Ford#8702310/9/02; 09:03:07

Of all the frights on Wall Street Ford is a little noticed but serious problem IMO. The stock is $6, their 10 yr bond is trading at a 20% discount, and their pension is underfunded by 6.7 billion and growing. That a big 3 automaker has failure risk priced into their stock and corporate debt is an amazing situation. I smell government bailout coming. They'd better get in line.
makcumka(No Subject)#8702410/9/02; 09:10:41

Control of the masses is the ultimate goal of any regime, and this ultimate goal has been, imho, achieved in the US. And it is spreading.

Since the times of the Roman Empire up until now the only way to control the masses was devising means and methods of keeping them "fat and happy". If the so commonly referred to here joesixpack is content, the government can do as it pleases. The majority of the people around the world are after three simple things: 1. Food. If they are fed, the survival is guaranteed. 2. Entertainment. If the brain is occupied, there is no room for worries. 3. Stability. If the government tells us everything is A-OK, we have enough entertainment and food, what else is there to worry about?

The reason all of the utopian ideas failed is because they all guaranteed struggle and hard work to achieve the ultimate bliss that was generations away. The masses are lazy and not interested in distant future. The Roman Empire provided gladiators, free bread and the security of the Empire supported by the huge army. Others aspiring to be a new Empire followed in the footsteps, with different means but same ultimate goals. US – they are the prosperous superpower (just read any newspaper), but they have one thing no one else has ever had. They have HOLLYWOOD.

Hollywood shows this society the way the world masses want to see it. It is easy. Good almost always defeats evil. You can achieve anything if you put your mind to it. And the Hollywood world is full of "beautiful people". The movies are seen around the world. The younger generations around the world brought up with Hollywood, no matter the amount of education, common sense and historical background, believe in the fairy tale of the beautiful fair world where the worries exist only to help people prevail and rejoice as the evil is conquered. Steven Spielberg is the high priest, Brad Pitt is the icon and Tom Cruise is the immortal. Add the media full of "breaking news" where the problems are purely criminal and the bad guy is almost always caught, thus contributing to the entertainment part of the scenario, add the food stamps and government cheese for the needy, add the superpower status guaranteeing stability – you have the winning combination.

The economic struggles seem less important to the masses, once they are "fat and happy". Gold, silver, oil, dollar, Euro – these are just meaningless terms, if the "Friends" are on and the media tells you the recession is over and things are looking up. Hence the "blank stares" and "deaf ears". The fight for the control of the masses is over. Hollywood won fair and square.

Tommy PMacumka: do we know someone how is doing this now????#8702510/9/02; 09:30:12

"Beware the leader who bangs the drums of war
in order to whip the citizenry into a patriotic fervor,
for patriotism is indeed a double-edged sword.
It both emboldens the blood, just as it narrows the mind.
And when the drums of war have reached a fever pitch and the blood boils with hate and the mind has closed, the leader will have no need in seizing the rights of the citizenry. Rather, the citizenry, infused with fear and blinded with patriotism, will offer up all of their rights unto the leader, and gladly so.

How do I know?
For this is what I have done!
And I am Caesar."

CoBra(too)Must Read! Investing for The Long Term!#8702610/9/02; 09:31:12


The Mogambo Guru calls it as he sees it, together with some of the few outstanding analysts and economists, whithout an agenda left out there in the paper asset minefields.

The only long term investment of lasting value - to hammer it home again - is and always will be the barabarous relic -gold. When Fiat confetti (... getting fond of B's expression) finally fails to pay back its promise of redemption - POG will again revert to its mean = Preservation of your Wealth! cb2

WaveriderBrazil real dives, stocks sag on debt, vote fears#8702710/9/02; 09:48:51

"Brazil's currency dove nearly 4 percent and its stock market sagged on Wednesday as election-wary investors fretted about whether the Central Bank would be able to roll over a hefty chunk of domestic debt coming due next week. "Market sentiment right now is about as low as it can get, both here and abroad," said Julio Mora, head trader at AgoraSenior CTVM brokerage in Sao Paulo. "There's a short supply of dollars in the market, there's a big debt rollover coming up, and the election outlook is flat out grim," he added, referring to Brazil's presidential runoff vote slated for Oct. 27.

In the stock market, banking shares continued to suffer in the wake of a recent government measure that makes it more expensive for banks to hold foreign currency and gold assets."

Waverider: Maybe I missed this in the discussion here - but what are the "government measures" that make it more expensive for banks to hold Gold? TIA!

Mr Greshammakcumka, Blackjack#8702810/9/02; 10:32:59

Makcumka: You are a wise man/woman/person indeed, with that basic view of human motivations (or lack of). Earned and learned the hard way, no doubt, from your experiences in Russia. May you prosper and enjoy life here and make your family proud! (Forgive me if I have missed some of your posts and mistaken some of these details about you -- time is short these days!)

Blackjack -- You are a most worthy addition to our News Network. With your links and commentary added to those of your fellows here, there is even less time needed to browse elsewhere for the essentials of our daily societal madness, indeed. Thank you.

eurogoldtest#8702910/9/02; 10:45:46

password works
Gandalf the WhiteWELCOME Sir Eurogold !!!#8703010/9/02; 10:49:01

We all have been waiting for you !!

CrossroadsQUOTE BY JULIUS CAESAR#8703110/9/02; 11:00:02

"Barbra, who are you listening to?" James Shapiro, a Shakespeare scholar at Columbia University, practically shouted into the phone.
He was talking about Barbra Streisand, diva and Democratic darling, who recently recited an anti-war speech she claimed was from Shakespeare, but turned out to be a hoax circulating on the Internet.

She had slipped the speech into her routine somewhere between "The Way We Were" — in a version updated to cast the last Democratic presidency in a golden light — and an inspiring rendering of "God Bless America" at a September 29 Democratic Congressional Campaign Committee gala in Los Angeles.

Tevyemakcumka, Control of the Masses#8703210/9/02; 11:03:07

makcumka, I enjoyed your post. Feed. Entertain. Stabilize. Gain Control.
Now with many if not most JoeSixPacks having a 401K or an underfunded pension plan, they see firsthand the lack of stability (if they look up from the entertainment). Such knowledge may serve to limit control!

It is interesting to note some of the political discussions regarding stability. On one hand, one camp wishes to "privatize" social security, giving individual control. On the other hand, a different camp wants a "gov. lockbox" to provide stability for us. Is there a clue here?

As for us, we rely on BB and Boxman for future food storage ;-) , USAGold forum for entertainment and Gold for stability!

Gold. Its Tradition.

PizzNot a Pretty Picture#8703310/9/02; 11:11:29

J. R. Nyquist may be considered fringe and way out in right field, but his articles have more depth and rational reasoning than anything I'm hearing out of Washington.

Just wish the message was a bit more optimistic, but if there was any real good news out there, we'd have already heard it.


axNY GOLD CLOSES UP USD 1.40#8703410/9/02; 11:43:43

Ny Gold closed today at USD 319.7, up from 318.30 yesterday.
USAGOLD / Centennial Precious Metals, Inc.The Fruit of Your Labor#8703510/9/02; 11:48:29

Swiss gold francs
Harvest Time
Whatever it is that you may have sown,
we'll give you the power to reap GOLD.

Centennial has three decades of experience in the field

TownCrierU.S. currency losses on top of equity losses#8703610/9/02; 12:15:31

HEADLINE: Dollar Falls Against the Euro and Yen as U.S. Stock Decline

New York, Oct. 9 (Bloomberg) -- The dollar had its biggest drop against the euro in almost three weeks and fell against the yen as stocks declined, prompting many investors to pull funds out of the U.S.

``There's been such a heavy concentration in the U.S. market that a general [global] decline in equities seems to disproportionately disadvantage the U.S.,'' said Craig Larimer...

Demand for the dollar ebbed as U.S. stocks fell for the fifth day in six. The dollar has traded in the same direction as the Standard & Poor's 500 Index more than 85 percent of the time over the last six months. [The S&P] reached a five-year low on Monday and has lost 31 percent this year.

Falling corporate bond prices also sapped demand for the dollar, said Jay Bryson ...``If no one wants to buy our corporate bonds, then the dollar is going to come under pressure,'' Bryson said. ``We rely on those capital flows to finance our current account deficit.''

--------(see url for full text)------

It's a very slippery slope downward when the dollar loses its precarious position atop the currency pile. Even Alan Greenspan himself has recently warned publicly of this phenomenon.

With gold ownership you don't have to share the fate of the dollar. Call Centennial today for good exchange rates.


The CoinGuyHoly Smokes#8703710/9/02; 12:17:42

Just returned from vacation...No deer this time.

Saw miners got slaughtered yesterday. Looking for bargains here.

Pizz, JPM just downgraded again by Moody's from A1 to Aa3.

The CoinGuy

RockPizz .. Good Article #87033#8703810/9/02; 12:20:52

I can only echo the words of one if the greats here at the mighty oaken table of yore. In a word.......grim


silvergolongBlack Blade: New Era of Oil#8703910/9/02; 12:41:56

Everyone should check out the above link.

Dr. M. King Hubbert was a brilliant visionary 30 years ahead of his time. In 1956, he predicted that US oil production would peak in 1970. At the time he was laughed at, but was later proven correct. He made a similar prediction that World oil production would peak this decade, and this also is proving to be the case.

People think that Oil is critical for energy and transportation. What most people DON'T realize is that cheap oil ensures cheap food. Petroleoum products power farm machinery and are used in the production of herbicides, pesticides, and fertilizers. Unless positive action is taken NOW, when oil production starts its decline, the world will become a darker, colder, hungrier, and less mobile place.

Hubbert's visionary brilliance was not just limited to oil exploration and production. Here is an incredibly prescient statement he made in 1981. It lucidly foresees the problems of today and gives depth and perspective to Another's and Friend of Another's points of view.

"The world's present industrial civilization is handicapped by the coexistence of two universal, overlapping, and incompatible intellectual systems: the accumulated knowledge of the last four centuries of the properties and interrelationships of matter and energy; and the associated monetary culture which has evloved from folkways of prehistoric origin.

"The first of these two systems has been responsible for the spectacular rise, principally during the last two centuries, of the present industrial system and is essential for its continuance. The second, an inheritance from the prescientific past, operates by rules of its own having little in common with those of the matter-energy system. Nevertheless, the monetary system, by means of a loose coupling, exercises a general control over the matter-energy system upon which it is super[im]posed.

"Despite their inherent incompatibilities, these two systems during the last two centuries have had one fundamental characteristic in common, namely, exponential growth, which has made a reasonably stable coexistence possible. But, for various reasons, it is impossible for the matter-energy system to sustain exponential growth for more than a few tens of doublings, and this phase is by now almost over. The monetary system has no such constraints, and, according to one of its most fundamental rules, it must continue to grow by compound interest. This disparity between a monetary system which continues to grow exponentially and a physical system which is unable to do so leads to an increase with time in the ratio of money to the output of the physical system. This manifests itself as price inflation. A monetary alternative corresponding to a zero physical growth rate would be a zero interest rate. The result in either case would be large-scale financial instability."

"With such relationships in mind, a review will be made of the evolution of the world's matter-energy system culminating in the present industrial society. Questions will then be considered regarding the future:

* What are the constraints and possibilities imposed by the matter-energy system? human society sustained at near optimum conditions?

* Will it be possible to so reform the monetary system that it can serve as a control system to achieve these results?

* If not, can an accounting and control system of a non-monetary nature be devised that would be approptirate for the management of an advanced industrial system?

"It appears that the stage is now set for a critical examination of this problem, and that out of such inquries, if a catastrophic solution can be avoided, there can hardly fail to emerge what the historian of science, Thomas S. Kuhn, has called a major scientific and intellectual revolution."

Chris PowellDie, Monster, Die#8704010/9/02; 12:49:52

Moody's cuts J.P. Morgan senior debt rating

NEW YORK, Oct. 9 (Reuters) -- Moody's Investors Service
today cut J.P. Morgan Chase & Co.'s long-term debt
ratings, affecting about $42 billion of debt, reflecting
concern about the No. 2 U.S. banking company's
medium- and long-term business outlook.

Moody's cut J.P. Morgan's senior unsecured debt
one notch to "A1," its fifth highest grade, from "Aa3,"
and cut several other ratings. Its rating outlook is now

In a press statement, Peter Nerby, a Moody's senior
vice president, said J.P. Morgan's financial performance
"has lagged behind similarly rated peers during this
cycle. Moody's is concerned that (J.P. Morgan's) recent
problems may further complicate its ability to execute
its capital market strategy, which has so far met with
only partial success."

He said J.P. Morgan's liquidity is "strong" and capital
ratios are "good."

The downgrade could make it more costly for J.P.
Morgan to borrow as Chief Executive William Harrison
tries to cut costs. The bank is preparing to cut thousands
of jobs, people familiar with the companies said, as
underwriting and trading revenue decline and loan
losses mount.

Standard & Poor's Ratings Services on Sept. 17 cut
J.P. Morgan's long-term debt rating one notch to
"A-plus," equal to Moody's new rating.


PizzCoin Guy#8704110/9/02; 12:54:38

Thanks for the JPM update.

Had a couple opportunities to watch the Level II action on JPM. I hate to inform the uniformed, but there sure does appear to be a market for blocks of stock other than posted limit orders. It's just like someone rolled a huge dumpster out behind the NYSE and their just dumping the blocks in at or arouind the spread (probably red for sells and green for buys) and they try to sort out the mess at the end of the day and are sending someone the bill (wonder who??? smile).

I think it would only be fair to force the deep pockets to at least post their off-market bids and asks under an appropriate handle, like FED or TREA. Sure don't see any extra help for long PM stock holders, but the shorts might get a little p.o.'d.



BlackjackNews just reporting another attack in Kuwait #8704210/9/02; 13:03:06

thanks for your remarks.

The CoinGuyMystery buyers and short interest.......#8704310/9/02; 13:24:02

Pizz, thats been the unspoken word for some time now. Letting air out of the bubble slow or fast, yields the same or worse results in the end. Might just keep the public from panic(do i smell a frog boiling?).

Just got off the phone with my bond guy. Boy is he extremely nervous(TXU blowup was latest) these days. It didn't help when the JPM downgrade came during mid conversation. I won't repeat his comments, but counterparty risk was the topic of conversation.

Speaking of PM's, the short interest in some if these unhedged miners is bordering on ridiculous. I'm starting to test the waters here. Only seeing a couple I like. Would have preferred to enter GG on that dip yesterday, but the gap was filled "with vol". Missed. At any rate, I've picked my issues, and I'm testing firepower. We shall see.

That bounce on the $HUI looks familiar. Deja Vu. Hope it holds.

The Coin(40% in Physical)Guy

Buena Fespeculations#8704410/9/02; 13:43:51

for weeks hot money runs to us govvies (T-bonds), rates drop (last hope), but corpies are getting killed, spreads widen, at some special moment foriegn cb's will pull the trigger on system #7 (us$) and begin to liquidate us govvies (carefully planned, aka Another), all hell will break loose as rates rise (gold will launch), us banana will evaporate and the euro trap will have been sprung, to many players for us to attack at once, the world as we know it will change forever, oil will hop to euro as planned, world system #8 will be born.


Black BladeRe: Silvergolong – Oil Peak#8704510/9/02; 14:24:57

I have addressed this issue in great detail in "The Rise and Fall of Hydrocarbon Man" post quite some time ago. Perhaps I should follow it up again soon.

Dr. M.K. Hubbert was one of those brilliant geologists who stuck his neck out and went against conventional wisdom. When I went to graduate school, my choice was based on the fact that I wanted to learn from those who "cut across the grain" and exhibited some unconventional and creative thinking. Dr. Hubbert was criticised and while he was working at Shell Petroleum at the time, he was informed by management that they were not pleased with his "pessimism" and that they preferred that he did not go through with his presentation to his professional and academic peers. He did anyway and the rest is history.

A few of good books on this and similar subjects (of several that I good cite) are:

1. "The Prize: The Epic Quest For Oil, Money, and Power" By Daniel Yergin, 1993. The book furthers ones understanding of the United States' place in this history which, in turn, helps us to understand why oil is a vital national interest to the most powerful nation on earth. With this in mind, the book helps one to understand not only the influence people like the Samuel brothers, the Rothschilds, and the Rockefellers had on the development and growth of the industry, but most importantly how and why this industry has such influence on the direction of U.S. foreign policy.

2. "Hubbert's Peak: The Impending Oil Shortage" By Kenneth S. Deffeyes, 2001. This book has been on the top 10 list and is one of the books recently seen carried by George Dubya. Kenneth S. Deffeyes was a protégé of M. King Hubbert at Shell and is currently a professor of Geology at Princeton University. He delivers a sobering message: the 100-year petroleum era is nearly over. Global oil production will peak sometime between 2004 and 2008, and the world's production of crude oil "will fall, never to rise again." If Deffeyes is right--and if nothing is done to reduce the increasing global thirst for oil--energy prices will soar and economies will be plunged into recession as they desperately search for alternatives. It is no wonder then that Oil Men like George "Dubya" Bush and Dick Cheney have read this book.

3. "Geodestinies: The Inevitable Control of Earth Resources Over Nations And Individuals" By Walter Lewellyn Youngquist, 1997. GeoDestinies helps to identify the forces that will determine our future. Some of these include the exponential population explosion, the ever-increasing demand and use of fossil fuels and other non-renewable resources, the degradation of our soils and groundwater, the truths and misinformation concerning alternative energy sources, and the relationships between natural resources and politics, economics, and our culture as a whole.

4. "The Coming Oil Crisis" By Colin J.Campbell, 1997. During 1997, an academic debate of immense significance for the future of civilization began to surface in a remarkably diverse array of media. The debate concerns the question, is there enough crude oil left in the world to get us to 2010 without a historically unprecedented discontinuity. The whole character of society in the 20th Century, and of its history, economics and politics is more a product of oil than of any other factor. The crucial question which Campbell addresses in his book is how much oil remains to be found and for how long global oil resources can continue to support the expected growth in demand. Having access to Petroconsultants' extensive database, he has carried out a detailed and comprehensive analysis of historical production data and of the Earth's ultimate oil potential. His estimate of the ultimate oil reserves is 1800 billion barrels of which 1600 billion barrels have been discovered, and he predicts that there are only a further 200 billion barrels yet to be found. His most crucial pronouncement however, is that once the global mid-point of depletion has been reached, production rate will decline.

Actually for a review of Hubbert's Peak numbers 2 and 3 are the best, however, number 1 is an excellent primer on the power of oil interests in today's world. He who has the gold rules the world, but he who has the oil runs it.


- Black Blade

BTW, the Afternoon Gold Report is updated and what a day it was. We should expect to see some wild action tonight.

kasperjackHis Masters Voice Er Cramer Courtesy Of White Jackets#8704610/9/02; 14:25:53 All you want to know about derivatives and the way a JPM collapse would affect the derivatives markets. Cramer wrote it but it reads like he had plenty of authoritative help.
Thanks again to White Jackets for providing the link..

BlackjackCivil War in Venezuela?#8704710/9/02; 14:50:52

Caracas, Oct. 9 (Bloomberg) -- A Venezuelan army general urged President Hugo Chavez to quit, a day before an opposition march is scheduled to demand the president step aside for early elections.

Army General Enrique Medina made his call as opposition leaders readied plans for hundreds of thousands of protesters to march in the streets to force Chavez from office. Chavez quashed a coup attempt in April, and since then has faced daily calls from business, labor and political leaders to step down.

``The great majority of Venezuelans are looking for an exit from this political crisis, and that exit is the departure of the president,'' General Medina told reporters. ``Tomorrow, there has to be a large, overwhelming demonstration to tell the president, `No more.' There's no other way.''

Medina's remarks recall similar statements before the April coup, when military leaders publicly urged Chavez to resign. Chavez said yesterday a coup planned for this weekend had been uncovered. Medina is a former military attach‚ in Washington and has no current command, according to the Venezuelan Inspector General's office. He has been linked in the past to coup sympathizers, according to analysts and the local press.

``If they attempt anything, we will be ready,'' Chavez said in a speech shortly after Medina's call. The 48-yeard-old former lieutenant colonel reiterated that police raided the home of former Foreign Minister Enrique Tejera and found maps and names of conspirators.

Panic Buying

Panic buying was reported at some grocery stores as Caracas residents stocked up on staples. In April, many stores closed down after the coup attempt was followed by looting in some neighborhoods.

``This is a time bomb that has started to tick,'' said Vitali Meschoulam, a political risk analyst with the consulting company Eurasia Group in New York. ``It might take days, or it might take months. But it is imminent.''
Tomorrow is the big march on Chavez.
Will it go smoothly or start civil war?

makcumka@ TommyP, Mr Gresham#8704810/9/02; 15:16:47


You could not be more on the mark. It is sad how in the name of patriotism things can be completely overlooked. Looking back in history, USSR did some pretty awful things to its citizens in the name of victory of the Soviet lifestyle, nd later in the name of victory over the Nazis. No personal parallels were meant here, just a curious coincidence.

Mr Gresham: Thank you, Sir, for your kind words. Seems like my prosperity now depends only on me. My government has failed me. Who woulda thunk?

kasperjackGolden Opportunity#8704910/9/02; 15:23:45 Reuters Market News
US CREDIT OUTLOOK - Almost no place to
Wednesday October 9, 4:58 pm ET

By Eric Burroughs

NEW YORK, Oct 9 (Reuters) - Each day seems to bear more grim news for
high-strung U.S. capital markets and provide U.S. Treasuries yet more
reason to
hit new historic low yields.

As stocks keep hitting five-year lows and mounting worries about credit
have pummeled widely held names like Ford Motor Co. (NYSE:F - News)
and J.P.
Morgan Chase (NYSE:JPM - News), investors are seeking shelter in only

Black BladeOil Inventories Fall to 1979 levels!!!#8705010/9/02; 15:25:38


U.S. commercial crude oil inventories (excluding those in the Strategic Petroleum Reserve) fell by 4.7 million barrels last week to end at 270.5 million barrels, the lowest level recorded at least as far back as EIA has been keeping weekly statistics (1979). Commercial crude oil inventories are now just 0.5 million barrels above the Lower Operational Inventory and over 39 million barrels below the level last year at this time. The decline was especially acute in the Gulf Coast, where they fell by 8.1 million barrels. With reduced refinery production, distillate fuel inventories fell by 2.7 million barrels last week, while motor gasoline inventories dropped by 3.1 million barrels.

Black Blade: The inventory situation is critical as we head into winter season and heating oil inventories are at very low levels. This should get "interesting" even as Wall Street ignores the obvious.

Off to the gym and maybe slay the beast!

makcumka@ Tevye#8705110/9/02; 15:27:03

The trick to keeping masses from suspecting anything is to tell them the truth when it is too late. Enron - when the news came out, 401k's were long gone. And the great excuse without taking blame always works - it is unfortunate this has occured. Another good one - I have no recollection of that, Senator.

As far as who needs to control social security - it might be simpler than we think. The proponents of privatizing social security are financied and lobbied by the banks, who desperately need additional cash flows into the crumbling economy to postone the nosedive. The proponents of government control need the government to keep the access to ensure a "loan" is always available, backed by I.O.U.s courtesy of the government that no other country will lend the money to. Sort of the last resort to postpone the nosedive. Since the nosedive is "imminent" and "non-avoidable", it's a struggle who will appear more caring about the joesixpack and will get the last chance to rip him off.

Oh, yeah, BB: just bought my first stack of canned foods, rice and such. People think I am NUTS. :) Thank you for the advice.

Strad MasterAbbey Joseph Cohen Speaks....#8705210/9/02; 15:29:14

And the financial world listens....

Here's an amusing little tidbit from AJC. Is she serious??? Talk about deluding onesself (not to mention her clients) Time is growing short for a 43% rise in the Dow.

Goldman Sachs' chief investment strategist Abby Joseph Cohen lowered her 12-month target on the Dow industrials (CBOT:^DJI - News) to 10,800 from 11,300 and the S&P 500's (CBOE:^SPX - News) to 1,150 from 1,300.

Still, the new targets represent upside of 43 percent and 44 percent, respectively, from current levels. And despite the target trimming, Cohen claims that stocks are undervalued based on her dividend discount model.

"We think that share prices already reflect ugly scenarios and that the large risk premium embedded in share prices provides a cushion," she told clients.

The well-known strategist does not expect a double-dip recession scenario to play out and feels that the "worst is past," with profits moderately rising and "looking cleaner." Cohen acknowledged that higher investor risk aversion will take longer to dissipate but predicts it will decline within the next 12 to 18 months.

kasperjackCorporate Bond Selloff?#8705310/9/02; 15:44:05 Reuters Market News
US CORP BONDS-Bonds wedded to
sickness, not health
Wednesday October 9, 5:28 pm ET

By Jonathan Stempel

NEW YORK, Oct 9 (Reuters) - Investors took flight from
U.S. corporate bonds
on Wednesday, likely sending the bonds' yields relative to
Treasuries even
farther above the record levels they set on Tuesday.

"A lot of people are bailing
out of corporate bonds --
investment managers,
mutual funds, banks and
some insurance companies,"
said James Cusser, who
invests $1.5 billion for
Waddell & Reed Investment
Management Co. in
Overland Park, Kansas.
Mutual funds, banks and insurance companies all selling corporate bonds. What about pension funds. Didn't Al say everyting was a ok with the banks just the other day?

Paper AvalancheArgentina just announced default on World Bank Bonds#8705410/9/02; 15:55:21

Per Ron Insana, Argentina will not make their $250 million interest payment due on 10/15.

And so it goes.

Nice to see JPM take it in the shorts again today. How about GE? I think that we will close on the lows at the close Friday afternoon. If that close is below 7,000 then we will more than likely close below 6,000 a week from Friday IMO.

The paper avalanche gathers momentum.

TownCrierMaybe investors are beginning to see that bonds aren't the safe haven they thought they were#8705510/9/02; 16:02:15

Be sure that you understand this -- a repost of important info from Saturday:

TownCrier (10/05/02; 14:15:06MT - msg#: 86694)
In a flight to safety from stocks, bonds may rub salt in your wound with additional losses
Here is a bit of helpful highgrading from the archives:

(excerpt from The Stranger's HoF msg#: 49230)
Bonds versus Gold
Bonds have two kinds of risk. First there is credit risk. That is the risk that the bond issuer's ability to repay will diminish over time, perhaps to zero. This would reduce the value of the bond accordingly. Credit risk is not usually a factor when buying treasuries, but it is always a consideration when choosing municipals or corporates.

The other kind of risk facing bonds is interest rate risk. If you buy bonds at currently prevailing rates of return, and then the economy experiences a general rise in interest rates, your older, lower-yielding bonds will no longer be as attractive to new investors. You will have to mark them down in price to sell them.

...Bonds are poison when inflation rises. For this reason, they are often considered the investing antithesis of gold.
(end excerpt)

Bottom line: As the spot currency weakens in the eyes of the world's investors, the change in present value (the marketable price) of the bond will compound these losses as the bond represents a sort of futures contract on the denominating currency. The following flight from bonds can become a raging selloff spiral when the turn arrives. As the currency fails no interest payment stream will satisfy investors and bond prices will continue to plummet as the effective yield soars. Gold can preserve real wealth, bonds can't.


Mr GreshamBlack Blade, makcumka, Tevye#8705610/9/02; 16:04:58

BB: Some things take time to appreciate, and your list (wasn't it 10 books before?) is a reading list to make one into a "prophet in his own country" -- and probably one who won't want to be heard from at cocktail parties (don't go to them anyway). My Dad worked in oil his entire career, and that's his "grim" assessment to. Sort of like "You young'uns are gonna have a lot to work out." without any idea of an alternative, from him.

makcumka: That privatizing SS is a joke now, isn't it? Gov would have to write the banks a check, and as it stands now, they need the cash flow too badly. That unholy partnership -- banks and gov (I wonder who's Senior, and who's Junior? -- must be chafing on all contact surfaces lately. No "merger" will help -- who cuts who loose? Who is expendable. Sharks turn on their own after the kill?

Tevye: I call it "having a Tevye moment", when I just want to retire to a small, quiet farming village, get my daughters married off well (I'm 1 for 2 already) and enjoy my garden and my reading. And also start to look around for something I can pass along to the grandkids as "Tra-DIT-ion!"

BlackjackBonds may Fall if Japan sells#8705710/9/02; 16:15:59

As Japan has to raise cash to bail out their
sinking banking system, they might start selling
the huge position they have in US bonds.
This would cause interest rates here to go up.

TownCrierBond woes, stock woes, currency woes... interrelated#8705810/9/02; 17:02:42

This url has already been posted (thanks kasperjack) but I want to ensure you take note of these excerpts in the context of the other material I've posted today.

HEADLINE: US CREDIT OUTLOOK - Almost no place to hide

NEW YORK, Oct 9 (Reuters) - Each day seems to bear more grim news for high-strung U.S. capital markets and provide U.S. Treasuries yet more reason to hit new historic low yields.

As stocks keep hitting five-year lows and mounting worries about credit quality have pummeled widely held names like Ford Motor Co. and J.P. Morgan Chase, investors are seeking shelter in only the safest of capital hide-outs.

Spreads on corporate bonds, agency debt, mortgage-backed securities and emerging market debt all widened against Treasuries on Wednesday...

"People who have been in this business 25 years will tell you they've never seen anything like it before," said Doug Williams

And few expect any improvement soon. Ford's bonds, pounded on worries about the company's profit outlook and ability to keep refinancing its debt, are some of the most widely owned and those losses have burned many investors.

Meanwhile, the banking sector is coming under pressure with slowing business and loan losses taking a toll -- adding to new worries not only about credit quality but also putting up roadblocks in capital markets for borrowing.


There is perhaps a parallel with the stock market that may be instructive regarding the lasting strength of Treasury bond issues even while the corporate issues begin to suffer.

You may recall that many individual stocks had already peaked out during the late 1990s, however, the indicies (Dow and Nasdaq) didn't actually top out until spring of 2000. And even then, the Dow index (which is our parallel with the Treasuries) remained stubbornly resiliant even while the Nasdaq index finally began its long and inevitable selloff. It was only then a matter of time before the Dow index too was recognized as vulnerable for all the same reasons, and we are now seeing it fall on fundamentals.

The parallel lesson here is that while the little guys, the corporates, will be early in revealing the trend, it is only a matter of time before the fundamentals drive the bellwether to follow the flock down the mountainside.

It cannot be stressed enough that these eroding fundamentals of corporate profits, credit risk, and interest rate (currency) risk DO NOT apply to gold even as they act to put a cap on stocks and bonds. Physical gold will actually shine brighter with fundamental strength even as it absorbs ever more numbers of intelligent buyers who truly UNDERSTAND their motives and actions.


kasperjackMakcumka#8705910/9/02; 17:10:43

Bread Circus Authority

Saidth the devil to our Lord Jesus Christ in the Legend of the Grand Inquisitor. Another compatriot of yours E. Zamyatin picked up Dostoevskys theme in WE. WE was westernized and used as a basis for 1984 by Orwell according to Orwell himself. The idea was then picked up by Huxley in Brave New world. Bread Circus and Authority. You have touched on a most important theme of Christain culture. Interesting. The devils currently hold the advantage No? The ethical disintegration preceded the the collapse of the economic bubble....
R PowellStrad // Reassuring words from Abbey Cohen#8706010/9/02; 17:26:59

Thanks for the comforting words from Abbey Joe. You posted them just in time as I have been suffering lately from a nagging feeling that perhaps that much talked about "capitulation" event for the stock market is now approaching. I have had visions of a day with the usual selling on light volume but with no buyers to be found.
Is there such a thing as a "feel" for the markets?
Does anyone else sense that investors are growing more and more uneasy even with bonds? Thanks Randy for reposting the Stranger's bonds warning. Where is that safe haven? I don't have any available silo storage space for corn or soybeans. I also do not own a garage so I won't be purchasing BMWs but I've found that silver doesn't take up much room. Lord knows it's cheap enough now so it can be marketed as brick pavers. Whether Abbey Joe is right or not, I don't believe silver or gold will be cheap much longer.

R PowellWASDE report // metal prices#8706110/9/02; 18:03:22

The USDA's WASDE report (monthly agricultural estimates) is due this Friday at 8:30 EST so tomorrow is the last day before the report for paper positioning.
These reports do move markets. Gold and silver are not grown or consumed or subject to a shelf life but these too will be priced by supply and demand when the illusion of a never ending surplus supply is disproved. The Silver Survey 2002 does mention the issue of so-called black silver or unknown stashes of silver. The Survey explains that unlike perishables or seasonally grown commodities, available supply of both gold and silver are extremely hard to estimate as accumulation started thousands of years before anyone started counting But, the Survey does emphatically dismiss the notion of any Black Silver existence. There is a finite amount available and that amount has tallied less, every time counted. Some markets trade (set price) on fundamental information. Some trade on technicals or COT movements or price chart patterns but imho the silver market hasn't even considered the most basic tenet of a supply/demand deficit at all. I guess that even if it is noticed, it is as quickly dismissed as implausible that a real shortage could ever exist. This is the only concept that begins to make sense to me while I continue to try to understand the silver anomaly. In a normal market leftover supply at the end of the marketing year is presented as a percentage of total yearly use. This % number can then be used for previous years price comparisons. This would place silver carryover at about 15 to 20% (guesstimate at best), certainly a small enough number to initiate price rationing. POG is fighting manipulative forces but what's ailing the POS??

darkhorse?#8706210/9/02; 18:10:51

I'll repeat a question I asked over the weekend, and see if I can get a response this time...

Are government savings bonds (EE issue) worth keeping? It's not a big $ amount, but it's the kids money and I don't want it going to waste. I understand bonds are buying into somebody elses debt, but I don't know enough about which bonds are which (besides the obvious difference between government and corporate) and if I should liquidate now before a rush. Any and all help will be appreciated.

CometoseR Powell re: a feel for the markets and capitulation#8706310/9/02; 18:36:58

If you can get a look at the charts on the daily charts on the dow and S&P , daily price range in both indexes are getting long....there's a lot of stress in there and volatility for looks like over a week and there was a post of a report last night ( I thing the reference was McClennan site ) Great Information....

I agree!!! Feels ominous......

sectorSavings Bonds into Gold#8706410/9/02; 18:46:37

One is real, one is make believe

The savings bond is a promise to pay with the full faith and backing of ...Bill Clinton a few years ago. Today it's George Bush, or the Congress.

Gold is an asset that has no corresponding liability. Your children should hold an ounce or two in their hands. They will find, like so many others, that it is heavy "For it's size", and pretty.

Perhaps the best of all possible investments for children is gold as it gains value through the deterioration of government paper money, including bonds. Governments run deficits, it's what they do, it's who they are, it is their theology. That mechanism of devaluation is your guarantee that your golden gifts will gain purchasing power when compared with alternatives.

Think of it as undeveloped tax-free real estate.

BlackjackNikkei down 2%#8706510/9/02; 18:59:48

Tokyo, Oct. 10 (Bloomberg) -- Japan's current account surplus shrank to 1.16 trillion yen ($9.4 billion) in August as exports fell, a sign that the economy may be slowing.

The surplus, the broadest measure of trade because it includes investment and services, fell 8.3 percent from July, seasonally adjusted, Ministry of Finance figures showed. Economists had expected the surplus to widen to 1.32 trillion yen after narrowing to 1.26 trillion yen in July.

Exports, the main driver of Japan's 0.6 percent growth last quarter, are slumping as the U.S. economy slows and the yen's 6 percent gain against the dollar this year erodes the value of shipments from companies such as video-game maker Nintendo Co.

Japan's ``growth resting on one engine -- net exports -- is something that is not sustainable,'' said Frank Benzimra, an economist at Societe Generale Securities (North Pacific) Ltd. The economy ``may be back in recession in the second half of 2003.''
Japan banks taking another hit.

turkey hunter@darkhorse my 2 cents#8706610/9/02; 19:00:58

I don't think the $ as we know it will be around during the time your children will get to use it. Why save something that will expire worthless? If there is a new currency lined up to replace the greenback the greenback will be devalued to the new currency. This is why I hold physical gold in hand because the government can't guarantee me that the $ will be worth something in a year or 10 years. If they can't guarantee the $ then they can't guarantee a bond. Just my 2 cents.
darkhorseSector et al#8706710/9/02; 19:03:22

Ya got no argument from me, little buddy. I've been a convert for 2-3 years now. Grandma has been buying savings bonds for them...she was born/grew up during the Depression and unfortunately is one of them I get the funniest looks from when I, as they put it, "start in on my spiel" (sp?). It's been her present to all the kids on b'days and X-mas and I don't like the idea of cashing in just because it wouldn't be what I'd do. I already know about gold, and I don't need any of the standard lines we all know so well around here! The question I need answered is, in this investing environment, should I cash them in because of the possibility of some sort of default (obviously they'll be worthless if the government dissolves, but I'm talking about anything short of a meltdown).
PizzR .Powell#8706910/9/02; 19:47:20

Rich, on that funny market feeling and silver.

Bids for US paper assets appear to be thin and getting thinner. Spreads are widening also.

IMHO, if the PTB actually knew that the world was coming to an end within the next year, nothing that's happened over the past couple of years would have to be changed.

My personal and immediate concern are the auto manufacturers. These guys should have cut back a year ago, lightened up on production, and not incentisize (new word I just thought up) away their markets for the next 5 years. Fifteen more days like today and both GM and F will be penny stocks, and Ford is supposed to have 25B or so cash.

Go figure. As far as silver is concerned, with the stock markets discounting what I would say is a 30 or so percent reduction in the production of real goods, I'd have to say they feel that the industrial usage of the metal is going to drop off the cliff, without a corresponding investment demand. But then oil is still holding ground, just like gold, hmmmmmm

Well, and if that's the case, then I'm still a buyer, cause if the economy goes that far in the ditch, paper is going to go up in flames. . . . .soaked in oil in a silver and gold cauldron.


TrapperSir Macumba#8707010/9/02; 19:58:49

food storage

I'm glad to see you got some "grub insurance" but I would caution you to keep a low profile as you might attract too much attention. If you are US remember not to run afoul of federal food hoarding laws. They were put in place during the "survivalist " movement and you don't need a knock at the door if the baloon goes pop. Live small my friend.

makcumka@ Trapper#8707110/9/02; 20:18:30

Please tell me more...

I was not aware of the fact the "food hoarding" is now a crime. Throughout the history all of our ancestors stored food for the added security. Most interesting.

To all: I tell you, this forum provides the information one has to spend tons of time to search for. I wish I'd found it 5 years ago.

SundeckR POWELL #87061 - SILVER ANOMALY#8707210/9/02; 20:19:59

As a matter of curiosity, does anyone know what happened to all the silver that entered China during the 16th, 17th and 18th centuries?

The article on Cycles of Silver (see link) describes very large inflows during the Potosi/Japan and the Mexican cycles - many hundreds of millions - even billions of ounces. This was used mostly as coin.

Presumeably China does not have silver in circulation any more??? Has it all been consumed by later industrial processes? re-exported? or is part of it sitting in official reserves? Is China a "black silver" source?


makcumka@ darkhorse#8707310/9/02; 20:22:43

Personal feeling - the only way the government will default on the bonds when all other avenues are gone. Think you have some time to considre your actions.
Mr. Bill@Sundeck#8707410/9/02; 20:28:32

Shhhhhhhh! Nobody is suppossed to know about that stuff.
silvercollectorJapan#8707510/9/02; 20:29:15

Lot's of musing in the last few days; when does Mrs. Housewife begin to accumulate the physical like we saw in Jan/Feb?
makcumka @ kasperjack#8707610/9/02; 20:29:23

The ethnic disetnigration ahs not even started. imho, in a near future you will see a new cold war, a war over an opinion rahter than a lifestyle, unfold. People in glass houses will be in the position to cast opinions on the rest of the world for the simple reasons the rest still retains brick walls and has, therefore, something to hide.
makcumka@ Mr Gresham#8707810/9/02; 20:40:46

Mr Gresham: the trick is, neither party has anything to lose anymore. It's like palying blackjack with all cards up and the dealer sleeping. The first one to call the hand wins automatically.
The KnifeGeneral Economic Forecast: GRIM#8708110/9/02; 20:43:19

Just checking the Japan stock index.....down 282 points with zero confidence that their banks are going to put together a plan to correct the blood letting. Homeside.....the news is also bleak, Ford stock hammered by Wall Street analysts and additional lay-offs across many different sectors of the economy. The bonepile is exponential growing into a mountain of economic disaster unparalelled in our time. Also, I read the article regarding pawn shops and the increase in short term loans suggested by Black Blade. I personally have to agree that sales for gold/silver have exceeded my expectations. This year sales went beyond normal customers and spread to new customers concerned about keeping their heads above water. Conversely, the downturn forced many people to cash in their precious metals as they had nothing else left. The reasons are typical, "got laid off", "can't sell my properties", "can't pay my bills". From the trenches, I bid you well.
makcumkaRussia' production#8708210/9/02; 20:47:17

Looks like Russia is getting back in business. Hate to see the chance go by the way side. #5 next year?
Max RabbitzTerror#8708310/9/02; 20:49:39

Never underestimate the cupidity, venality, corruption, and/or stupidity of humans. You have but one defense. Three Guesses?

I wonder if techincal analysis can be applied to politics. If the 19th century was more bloody than the 18th, will the 21st be more than the 20th??? Just looking at the trendline and wondering how long before the correction.

There is no excuse for terror or those who excuse it.

tic tic tic tic.........

Sierra MadreDarkhorse: about bonds...#8708410/9/02; 20:49:59

Darkhorse, from what I pick up here and at other sites that are talking about the same things, more or less, there are worries that LONG TERM U.S. GOV'T BONDS may be vulnerable sooner or later. As always, no one can say just when.
The vulnerability comes from just what has made them attractive: a guaranteed return from the U.S. government that is not going to default on the bonds, and a return better than you can get on short term gov't notes.
Their prices are going up and up -check the box above on this page, and you will see a strong rise today.
Every time the price rises, since the return or yield is fixed, the yield implied by the price goes down.
If foreigners cease to want to invest in the U.S., or if their appetite diminishes considerably, then the dollar will go down.
You will still get your return, but it will be worth less as it will be in dollars whose value has gone down.
This will make foreigners, perhaps even less willing to buy the bonds. And that brings around the second problem:
In order to sell the bonds, the yield or interest on them will have to go up, and up.
Then the opposite effect happens, since the yield goes up, the price comes down, in the case of 10 year bonds. You will own bonds whose market value will go down from the very high prices they now command in the marketplace.
The best ideas, it seems to me, would be to change - and I would think, the sooner the better - to SHORT TERM TREASURY BILLS. The interest is much lower, but you protect your capital.
You would still own "government paper", but a paper whose value will not be liable to collapse in a hurry. The interest rate on the Treasuries would be adjusted upward soon, bringing in more income without a loss of principal.
By the way, this is what just about everyone does in less developed countries - they invest in 90 day Government notes. The U.S. Gov't and the Fed have behaved imprudently and they are now in a fix, just like the less developed countries.
Other governments, in order to sell their short term paper, offer rates of return that entice the buyers by offering a rate that exceeds the expectations of inflation.
This is a game between governments and investors! Sometimes the investors get burned by unexpected inflation or devaluation. The smarter ones generally come out ahead. It looks to me like this will be the situation in the U.S. pretty soon.

I hope this helps you out, and good luck in the game!


silvercollectorHope we have news/confirmation about this#8708510/9/02; 20:57:04

"Argentina just announced default on World Bank Bonds
Per Ron Insana, Argentina will not make their $250 million interest payment due on 10/15."

silvercollectorThe Knife#8708610/9/02; 21:04:44

Please post carefully and as often as you see fit.
Sierra MadreSomeone else who has an ugly feeling....#8708710/9/02; 21:15:02

FWIW, here's someone's opinion on the developing ugly mood. Notice he speaks of this past Monday, and it did produce a low below 7,460. Then deterioration all this week, which is right on schedule. Then, next week AHBL (all Hell breaks loose) and culminates on Oct. 16 - my wedding anniversary, heh heh!
You can find the whole article and other interesting stuff at the link.

Gloomily yours,


Prepare for Black Wednesday
October 16th
(Updated Oct 4th)
Today, I became convinced that the final slide into a crash started last Wednesday. Check out the 5-day chart above then look at the comparison chart below. Next week, you can expect a new low (below 7,460) on Monday with a possible rally attempt on Tuesday(10/08). I don't look for the rally to rise above 7,625 or last beyond Wednesday. Panic will begin when the rally fails and the market goes back to setting new lows on Thursday (10/10). Friday the decline will accelerate, then Monday (10/14) through Wednesday will be a madhouse.

(Sierra comment: Yikes!)

GuidedThinking back#8708810/9/02; 21:19:02

If those I warned about two years ago would have listened and traded some of their stocks for some gold, they would have a lot more money to their name today. Instead, they have taken a severe beating in the stock market and STILL they stay in. There are STILL small investors with hard earned money in this market!!!!

This is AMAZING and a mystery to me!

Much of the reason I was able to warn people back then to supplement or get out of stocks was the knowledge I gleaned from this web site.

I will never forget MK's words in one of the News & Views articles.

Went something like this:

Do you relish being churned, whipsawwed and separated from your capital?

Guess some do. ?????????? I know some very well. Or, maybe I don't really know them. If I did, I might understand why. They really can't explain it. Lately, they just have this stunned look about them and say "I don't know" a lot.

timbervisionFrom Merrill Lynch#8708910/9/02; 21:21:43

From Merrill Lynch: Canadian Morning Market Memo, Oct 9, 2002

"Reason to still be long gold – everyone wants a lower currency: the Europeans need it to quash deflation pressure, the Japanese want to see the yen decline to spur the economy and now we see American industry reps begging for a softer greenback. A study commissioned by the Steel Manufacturers Association concluded that the dollar's strength has had "exerted damaging effects". The National Association of Manufacturers went out with "we are not going to have a manufacturing recovery until we get the dollar back into normal territory". Despite the recent softness, the TSX gold index is still up 17% since the end of July."

From Merrill Lynch: Global Strategy #43

"The bad news is that at the end of the first quarter of 2000, international investors were sitting on unrealized capital gains of $980bn – more than twice today's capital gain. Such a loss of wealth is almost without precedent. If the S&P Composite were to fall below 700, that could put 37 years of international investing in US equities ‘under water’.

"The question we should now be asking is how is this going to affect overseas investors’ willingness to invest in US equities in future years. What is surprising is that more than two years into the bear market, international investors are still net buyers of US equities – as they have
been throughout the same period. But the more the US equity market weakens, the more we could see a reassessment of investor appetite for US equities as the buffer of unrealized capital gains evaporates.

"The fundamental issue here is that many domestic
investors still do not realize how dependent the US
economy and financial markets are on international
capital. It is wrong to assume that that capital is going
to always keep coming to America indefinitely at the
current exchange rate. A continued bear market could
encourage investors not only to turn more risk averse,
but to think twice about investing in US equities at this
exchange rate – especially if they feel their capital has
been unfairly treated. As the saying goes, ‘once bitten,
twice shy’."

Black BladeThe Unthinkable is Not Impossible#8709010/9/02; 21:28:53


On Wall Street, they are worried. At the Fed, they are burning the midnight oil. In bank boardrooms, they are passing out Maalox. The unthinkable may be about to happen. A systemic risk that causes the financial system to implode is now a distinct possibility. The $110 trillion worldwide derivative market may be about to unleash a storm of undetermined consequences. Nobody has a model that can predict the possible outcome. How do you account for something never seen before? It has been more than 70 years since a storm of this magnitude has been seen or experienced. Most who work on the Street or in the trading rooms of large financial entities have never seen a 100-year storm. Very few alive today remember the consequences, much less lived through the carnage of the Great Depression and the stock market crash that preceded it. To many, seeing the Dow lose 88% of its value as it did during the bear market of 1929-32 is inconceivable. The fact that the Japanese Nikkei has lost 78% or that the NASDAQ is down 78% doesn't seem to register. Everyone expects a market bottom and the worst of the storm is over. Nobody is watching the barometer; which is dropping rapidly.


This lack of confidence and risk in the financial markets explains much of gold bullion's strength. The latest sell off in shares of gold and silver companies is another leg of a wider sell off by weak hands into stronger hands. A lot of the share accumulation of precious metals stocks over the last few quarters has come from the day-trading crowd looking for a way to make a fast buck. They neither understand nor comprehend that they are dealing with a precious commodity that is returning to its historical role as money. Those in the know, and who have strong financial hands are accumulating at the expense of the ignorant and ill-informed. They will be back in the metals after they explode. Several key silver stocks are looking to break out as option spreads and short positions are unwound. The metals markets are a lot like a volcano. You never know when they are going to erupt. But when they do, it will be similar to the eruption of Mt. St. Helens. Gold and silver are commodities that are in short supply, with growing investment demand, and limited options for investment. When they take off, their rise will be parabolic -- not gradual. The residents below aren't aware that the volcano is rumbling. Short-sellers, take care.

Black Blade: A pretty good market wrap up tonight by Puplava. Not much to add expect that the "currency war" is poised to heat up again as the three major trading blocks are fighting a losing battle for a shrinking piece of the action. The Asian block (Yen) is pathetic and Japan (not just necessarily the banks) is insolvent. The west coast port closures sure must be causing a world of hurt for Japan. The must slaughter their currency upon the alter of sacrifice for the sake of exports. Japan is simply a large factory assembling trinkets for sale abroad – case closed. Euroland is now entering into a severe crisis of their own with failing banks (not just Comerzbank), rising unemployment, and a deepening recession. They too are looking to hobble the Euro for the sake of exports. Then there is the third trading block (the western hemisphere and the dollar). The dollar is grossly overvalued and that is killing the stock market as US made goods simply are not competitive. Add to that American consumers are tapped out so even if Asian and Euroland goods show up on US shores, there will be a weak market. We are in the early stages of a New Great Depression. The battle is on for each block to gain a competitive advantage by weakening there own currency, in short – Game Over!!!

Black BladeU.S. crude supplies fall for sixth week#8709110/9/02; 21:41:44{7A558CF6-EF4E-41C8-A884-D975C12A6F2B}&siteid=mktw

Futures stick to 50-cent range; traders assess prospects


NEW YORK (CBS.MW) -- U.S. government data confirmed Wednesday a sixth-straight weekly decline in crude-oil inventories, which now stand at levels not seen in more than two decades. However, crude for November delivery traded within a range of $29.26 and $29.78 a barrel on the New York Mercantile Exchange. The contract closed at $29.35 a barrel, down 13 cents. After Tuesday's close, the American Petroleum Institute said crude supplies, as of the week ended Oct. 4, fell by 2.6 million barrels to total inventories of 273.3 million barrels, the lowest level since 1976. API also reported significant declines in gasoline and distillate stocks. Separately, the Energy Department reported the weekly drawdown in crude at 4.7 million barrels to a total 270.5 million barrels, the lowest level the department has recorded since it began keeping track in 1979. These are "truly alarming numbers," said Thorsten Fischer, an economist at "Not only did crude oil inventories record a sizable draw, but they also fell to critically low levels, by historical standards, at a time when demand is expected to pick up due to the onset of the heating season in the Northern Hemisphere," said Fischer of the latest data. "The outlook for crude oil calls for continued high prices due to tight inventories and the prospects of rising seasonal demand," Fischer said.

Black Blade: Also, OPEC has reset the clock on the 20 trading-day ticker. That is – another month of no increase in OPEC production that will only exacerbate the tightness in supply. The morons on Wall Street will soon be caught flat-footed when petroleum prices begin to spike just ahead of heating season and a possible ME war. Oh well, just sell a few derivatives and that should do the trick. Hmmm…

timbervisionBlack Blade#8709210/9/02; 21:46:24

Black Blade,
After what prowed to be a fruitless endeavor, again, to get my parents to make a bigger move into gold, on the weekend, I have sent them your latest #87090. Thanks for the help. I've given up holding my breath though. Its not good for ones health.

Black BladeAbbott Labs to Cut 2,000 Jobs to Save $100 Mln a Year #8709310/9/02; 22:05:36


Abbott Park, Illinois, Oct. 9 (Bloomberg) -- Abbott Laboratories plans to eliminate about 2,000 jobs, or 3 percent of its workforce, after efforts to meet U.S. manufacturing standards pushed costs higher and delayed products.

Black Blade: More nonessential "Bones" are about to take their place on the growing "Bone Pile". Congress is debating an extension of unemployment benefits again.

Black BladeAT&T Cable-TV Unit to Cut 1,700 Jobs as Part of Sale #8709410/9/02; 22:07:49


Englewood, Colorado, Oct. 9 (Bloomberg) -- AT&T Corp. will eliminate 1,700 jobs at the cable-television unit it is selling to Comcast Corp., mainly by shedding managers who will be replaced by Comcast executives.

Black Blade: Yep, you guessed it – AT&T is doing its part to send more nonessential "Bones" off to the growing "Bone Pile". Some economic recovery. Oh yeah, tomorrow at 8:30 am EST we get the latest unemployment claims data (seasonally adjusted of course).

Black BladeRe: timbervision#8709510/9/02; 22:12:22

You're welcome. However, that's just one piece of a very complex puzzle and it is getting more convoluted all the time. This Bear Market (and recession) has surpassed all our recessions except the "Big One" that started in 1929. We are closing in fast and this current one threatens to be even worse as the equities markets are grossly overvalued. Even CNBC anchors Ron Insana and Ted Davis are waking up to this fact. Joe Kernan was on tonight in an interview and he was - shall I say less that optimistic about the economy. How times have changed. Cheers!

- Black Blade

OperativeOne More Thing#8709610/9/02; 22:14:42

Reading the board tonight one cannot help but begin to see the serious nature of things to come, sooner than later.
To Black Blade's list that we all know by heart, Gold, Food, etc I want to add any medications that you need. A 3 to 6 month supply, in hand, is something to consider.

And with the drop in enegy supplies, it may be time to dust off the generator, check it out, and stock some fuel to operate it. With events taking on a more serious tone, it may be a very long winter season ahead.

Cover Your Bases.

Black BladeConsumers shying away from debt #8709710/9/02; 22:37:23

After propping up the U.S. economy with borrowing and spending, consumers are watching their wallets


NEW YORK (CNN/Money) - Ignoring a recession, nearly 1.8 million job cuts and other horrors, U.S. consumers have tirelessly spent money in the past year, and much of that spending was fueled by borrowing. But consumers seem to finally be losing their stomach for debt, meaning they will likely need to see real economic improvement if consumer spending growth is to continue with any strength. "The rise in auto and other consumer loan delinquencies reflects the avalanche of layoffs over the past year and a half," said ABA chief economist James Chessen. "Until job growth gains upward momentum, relatively high levels of delinquencies will remain."

Black Blade: As I have been saying for some time now, the consumer is tapped out. The residual spending has been fueled by zero percent financing and those morons who are stupid enough to put their homes at risk by rfinancing and taking on more secured debt using their homes as collateral.

A fool and his money are soon parted, or as P.T. Barnum said, "there's a sucker born every minute".

Boxmansilvercollector msg#: 87085#8709810/9/02; 22:45:59,2106,2075166a6026,00.html

silvercollector wrote:

"Hope we have news/confirmation about this
"Argentina just announced default on World Bank Bonds
Per Ron Insana, Argentina will not make their $250 million interest payment due on 10/15."

silvercollector, the above link is an article concerning this. Is this what you were looking for?

Black BladeFrom The Mail Bag#8710010/9/02; 23:03:40

(Courtesy of Bill Bonner at Daily Reckoning)

No particular news seemed to propel the advance... Sometimes stocks just go up for no good reason. And who knows, maybe they'll keep going up for no good reason... for a while. Morgan Stanley's Barton Biggs, for one, expects a "powerful" rally between now and year end. Why? Mostly because the bears have become too numerous and too vocal. "The bears are everywhere and outspoken," says Biggs. In other words, its time for Mr. Market to teach them a lesson. "My instincts tell me this is a time to be a buyer of stocks, not a seller," the strategist said.

- Barton's instincts are pretty good, so he's probably onto something. Furthermore, the market "deserves" a little rally. But after stocks stop going up for no good reason, we suspect they'll fall again...for plenty of good reasons.

- For starters, the stock market is still very richly priced. For another, earnings aren't growing. "Earnings for the most part aren't bad," says Alan Abelson, "they're terrible. You have to really strain to see more than a wisp of smoke coming out of those smokestacks. As for jobs, there aren't as many as there used to be and it's increasingly harder to find one."

- So it looks like the "second-half" recovery that so many folks predicted earlier this year is turning into a second-half relapse. And the fact that unemployment is on the rise once again is particularly worrisome.

Also, a nice tidbit that emphasizes what I posted earlier about the "currency wars" along with Puplava's latest (the following is from Stephen Roach at Morgan Stanley):

"The American economy now has a record exposure to global competition. In the second quarter of 2000, America imported a third as many goods as it produced. More and more, these goods are coming from highly competitive Asian producers who have much lower cost structures than their American counterparts. "Every major Asian economy except South Korea is in the throes of deflation. Courtesy of ever-expanding trade relations with Asia, America is now buying more and more from China, Japan and other countries that are already in deflation. The growing market share of these increasingly cheap foreign goods helps drive down prices of products made at home. "The impact of deflation would be most acute for wage earners and debtors. To stay profitable, companies would have to cut jobs or wages, eventually inhibiting consumer purchasing power. Meanwhile, the fixed obligations of indebtedness would have to be paid back in deflated dollars, squeezing over-extended borrowers all the more.

Black Blade: My mailbox runneth over. Yet I do find these gems that are worth passing along.

Black BladeSerial Sniper Strikes Again#8710110/9/02; 23:41:32

This nutcase is at it again. Tonight he killed some poor guy filling his tank at a gas station. The police are still no closer to bagging this idiot. Yesterday he left a "death card" with "Dear Policeman, I am God". Obviously this freak is about five bottles short of a six pack.
GoldflyVoyager, How've you been?#8710210/9/02; 23:43:51

I still laugh about Clinton being elected Prez of the World.

Those were the days......

skiAden Sisters .... gold/stock market essay#8710310/9/02; 23:50:43

I have a great deal of respect for financial newsletter writers that have long established track records of making good market calls. In many cases, these individuals are very good at identifying a change in a major market trends in a timely manner. Acting on a major trend change is a good recipe for investment success.

See the link above for a short essay by the ADEN SISTERS. The essay covers both the STOCK MARKET and GOLD MARKET and includes two excellent graphs.

I have been following the work of these two sisters for about 15 years. Over this time, they have been very good at calling major market turning points.

From the essay, "Most important, something very big is happening (in gold and SM). Not only are we talking about major trends, which normally last a year or two, but we're also talking about MEGA SUPER trends, which generally last several years."

TownCrierHi Voyager#8710410/9/02; 23:57:50

Sorry, but the LeMet post had to go. Bill Murphy has previously warned us against anything that infringes on his LeMet copyright.


Black BladeAsian Meltdown#8710510/10/02; 00:18:19

Yep, Asian market take it down a few notches again. Looks ugly tonight. Euro may open ugly too, however, I almost expect some kind of fake out rally in the US market futures to give Europe false hope. Shoule get quite "entertaining" as the Lemmings run to and fro.

- Black Blade

VoyagerTownCrier#8710610/10/02; 00:25:43

Sorry Randy, was not aware of that. Although in his Midas Reports, USAGOLD posts are used. But, I don't want to create any waves on this issue.

Goldfly, I don't exactly remember that, but he sure can't keep his mouth shut. I really think he does want to be anointed as emperor of the world by the U.N.

Black BladeAnother Suicide Bomber in Israel#8710710/10/02; 01:17:17

Another suicide bus bombing in Tel Aviv a bit ago. One dead and 4 injured. It might have been worse, however, this "genious" tried to get on the bus at the rear door and fell backward. When the driver and a passenger approached thinking he was an injured passenger, they saw he was wrapped in explosives and at that point everyone scrambled about to get out of the way before he detonated. Looks like just another day in the Middle East.

- Black Blade

Topazdarkhorse:-Your Bonds.#8710810/10/02; 02:29:40

Although all the bases have been covered by previous posters, I thought I might offer some supplementary info for your consideration.
The "default" you refer to may not necessarily be the Governments but rather a Secondary Market phenomenon relating to Yield ie: when the Yield goes negative (or in backwardation)to Cash there is no valid reason to hold....resulting in a massive sell-off. This is further compounded as the mentality changes from "Buy now for tomorrow it will be dearer" to "I don't think I want them at ANY price".
When?....4.5% on the 30Yr without a rate cut I'm guessing.
There are many assets that are derivatives of this critter, R/E being just one.
Imo, follow Sectors advice.

Black BladeThe "Currency War" and the "New Great Depression"#87109