USAGOLD Gold Discussion Forum Archive

Electronic reproduction sourced from
The Invisible HandIs this the reason why Belgian shrugged?#1410972/1/06; 02:27:37

"I cannot": Thomas Aquinas replied to an anxious inquiry about why he had abruptly ceased writing and dictating his "Summa theologiae". His companion and confessor, Reginald of Piperno, afraid that overzealous study had induced insanity, insisted that he continue. "I cannot," repeated Aquinas, "because everything that I have written seems to me chaffy." Reginald was stunned. Within the month Aquinas decided to visit a sister but upon arrival remained withdrawn and taciturn. "Why," asked his sister, "is he stupefied and hardly speaking to me?" Reginald explained the case: "From about the feast of St. Nicholas he has been in this state, and since then he has composed nothing." Reginald importuned Aquinas to tell him why he refused to write and why he was stunned. After many interrogations Aquinas answered, "I adjure you by the living almighty God, and by the faith you have in our order, and by charity that you strictly promise me you will never reveal in my lifetime what I tell you. Everything that I have written seems to me chaffy in respect to those things that I have seen and have been revealed to me."

PRITCHORichard Russells Latest Comments - - - #1410982/1/06; 03:00:57

More words of wisdom from the master - --
January 31, 2006
Question -- Russell, everything I read or hear is to the effect that "gold is overbought and is on the edge of a major correction." Others say that "gold is in a speculative blow-off and therefore should be avoided." Does that mean that we should stand aside or take profits?

Answer -- The great majority of these bearish "experts" have never dealt with gold nor have they lived through a precious metals bull market. Those subscribers who were with me during the late-1970s remember how gold acted when it finally turned speculative during 1978, 1979 and 1980. Huge surges, frightening correction, wild action, tremendous volatility.

Compare that action with what we see today. The fact is that gold has been climbing carefully, almost tediously, with nothing to suggest "blow-off" action. Actually, we haven't had a day in months in which gold moved up or down as much a three percent. So far, the funds have purchased very little in the way of gold. Actually, the great majority of mutual fund hold no gold at all. The idea of owning gold has not even occurred to the average US investor.

Do you know anyone, any friend, business associate, relative, who has bought a substantial amount of gold -- or for that matter, any gold at all? I get e-mails almost daily asking how and where to buy gold. I often wonder how many of my own subscribers have put as much as 5 percent of their liquid assets in gold or silver. My guess is -- very few.

Finally, I don't give a damn how much "stuff" I hear about gold being overbought, gold in weak hands, gold shorted by the Commercials, gold overvalued. When a great primary bull market gets rolling, it always provides "shock and awe" for the detractors. That's about where we are now in the gold bull market -- just far, far from the end of the road.

The truth is that almost every comment about gold that I hear is a warning to the effect that gold is in a "dangerous, speculative blow-off." What do they know! When this gold bull market finally moves into its third and final phase, you won't believe the upside action that will materialize. Remember that saying that we last heard in 1978-79 -- "There's no fever like gold fever." Somewhere ahead, maybe a year, maybe five years -- gold fever will strike big-time. And it will be a sight to behold. What we're seeing now is "nothing," nada, the early creaking of a great bull market just pushing upward off its belly.

Cavan ManThe Invisible Hand#1410992/1/06; 04:15:12

Very interesting.....thanks....I will forward to my friends in the East....
Rook.,.#1411002/1/06; 07:14:01

Invisible Hand,
Botany. Thin dry bracts or scales, especially:
The dry bracts enclosing mature grains of wheat and some other cereal grasses, removed during threshing.
The scales or bracts borne on the receptacle among the small individual flowers of many plants in the composite family.
Chaff can extend pretty far depending on where we draw the line between it and the grain. Are you figureing gold in hand as the chaff free state? I suppose fiat qualifies as chaff.

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GoldiloxRussia could reduce gold production 2 tonnes in 2006#1411032/1/06; 07:59:52


MOSCOW. Feb 1 (Interfax) - Russia could reduce gold production 2 tonnes to 166 tonnes in 2006, Valery Braiko, head of the Gold Producers' Union, said at a gold industry conference in Moscow.

The Union forecasts that mine production will fall to 150 tonnes in 2006, from 152.026 tonnes in 2005. Incidental or byproduct output will be 11.1 tonnes, or similar to the 11.12 tonnes achieved in 2005, and secondary production or recoveries from scrap will rise to 4.9 tonnes from 4.8 tonnes.

Overall gold production fell 3.5% to 168.032 tonnes in 2005.

Russian jewelers buy around 40 tonnes and banks around 100 tonnes of gold per year.


Perhaps this is one reason Putin wants gold to "stay home."

TownCrierBernanke sworn in as new Chairman of the Fed#1411042/1/06; 08:02:16

February 1, 2006 -- Ben S. Bernanke on Wednesday became the fourteenth Chairman of the Board of Governors of the Federal Reserve System and the Chairman of the Federal Open Market Committee, succeeding Alan Greenspan. The oath of office was administered in the Board Room at 9:00 a.m. by Vice Chairman Roger W. Ferguson, Jr.

The Senate confirmed Dr. Bernanke as Chairman and as a member of the Board on January 31, following a hearing on November 15 by the Senate Committee on Banking, Housing and Urban Affairs. President Bush announced his intention to nominate Dr. Bernanke on October 24.

Dr. Bernanke's four-year term as Chairman ends January 31, 2010, and his fourteen-year term as a member of the Board ends January 31, 2020.


For background and commentary on the implications of Bernanke's chairmanship upon the future of monetary policy, see the URL given above.


TownCrierGreenspan Joins Brown#1411052/1/06; 08:41:16,,30400-13501467,00.html?f=rss

February 01, 2006 -- Former US Federal Reserve chairman Alan Greenspan has a new job.

Mr Greenspan, who retired on Tuesday after 19 years, will offer advice on global economic change as the Chancellor of the Exchequer Gordon Brown prepares for a series of meetings with world business leaders.

Mr Brown just days ago described Mr Greenspan as "not only one of the world's most outstanding economic policymakers, but the greatest economist of his generation".

Mr Brown says he is "delighted" with Mr Greenspan's decision to become an honorary adviser, adding that his help "will be much appreciated".

The Treasury said that Mr Greenspan's role would involve regular meetings with Mr Brown but no pay cheque.

"Mr Greenspan has declined any direct remuneration," the Treasury said.

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

Greenspan sure does love his policy-level economics. No suprise, then, that he's going directly where the 'action' is.


TownCrierGermany's Merkel recruits Bundesbank official as chief economic advisor#1411062/1/06; 08:43:36

BERLIN (AFX) - German Chancellor Angela Merkel has recruited a top Bundesbank economist, Jens Weidmann, to advise her in economic matters, a German government spokesman said today.

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

Central bankers in demand and on the move.


GoldiloxSir GS#1411082/1/06; 08:49:17

Well, at least now he can "earn" his knighting. Perhaps he'll tell Gordy to buy back the gold so foolishly sold earlier.
TownCrierGold may hit $610 but Indian demand will glitter#1411092/1/06; 08:51:49

MUMBAI (Reuters) - World gold prices are likely to rise to $610 an ounce by March/April, but this is unlikely to deter Indians from importing the same amount of the precious metal in 2006 as last year, the head of the country's leading bullion trade body said on Wednesday.

Mukul Sonawala, president of the Bombay Bullion Association, said "There is inherent strength in the market... All the fundamental factors are pointing to that."

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

$610 by March/April? Buy now and save.


TownCrierHEADLINE: Why you must buy gold#1411102/1/06; 09:02:58

(Rediff India Abroad) February 01, 2006 -- In recent months, gold has caught the fancy of many an investor. And why shouldn't it? Gold prices have risen by over 17.80% in 2005 and more than doubled since September 2000. And if the 'experts' are to be believed, there is a lot more steam left in gold prices.

...Gold is a commodity the price of which is determined by various factors apart from its demand and supply. Also, it is a commodity that is priced in US Dollars as against our local currency (the price of gold is determined in international markets; domestic prices track the international price very closely).

What becomes apparent is that the factors that affect the price of gold are rather different from factors that affect other assets like say domestic fixed deposits. And therefore, if inflation in India were to dent the value of the Rupee, and consequently your wealth, it will have no impact on the price of gold (other factors remaining the same) thereby lending support to your wealth. In fact, in times of inflation, the smart money tends to move to gold, thereby driving up its price.

The preference for gold stems from the fact that it is readily available in a standardised form. Moreover, storage is not that big an issue as compared to, say, crude oil!

As mentioned earlier, at present the interest in gold as an investment destination is palpable.

In our view, gold is a must in every portfolio. However, the extent to which you should be invested in it should depend on your overall asset allocation.

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

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GoldiloxGold below $570 on profit taking#1411112/1/06; 09:12:45


The spot price of gold on Wednesday declined below $570 a troy ounce on profit taking and a strong dollar against the euro, traders said.

At 1.45pm, gold was quoted at $568.38/oz, down $0.37/oz from the previous close. On Tuesday gold traded as high as $572.95/oz — its best level since January 1981.

The euro was last quoted at $1.2095, down $0.0046 from late trade on Tuesday.

"Gold is lower on the stronger US dollar. After yesterday's peak, the market has gone quiet, with market participants exhausted after the activity in January when gold ended the month at a fresh 25-year peak," a London- based trader said.

"The market is sighing in relief and returning to its old ways of fluctuating with the US dollar. The gold market remains bullish. However, if the turmoil in the Middle East is resolved and Iran gives up its uranium enrichment then the gold price will drop," he added.

"The key factors that are supporting gold are the high oil price, Middle East turmoil and general strength in commodities, with aluminium over $2,500 a ton," he said.

Investment bank UBS has increased its one-month target for the gold price to $575/oz, although the bank expects a correction at some point, London-based UBS analyst John Reade wrote.

UBS continues to forecast gold at $555/oz on a three-month view, he added.

Gold ran into profit taking as traders in Hong Kong and Singapore, returning from their Lunar New Year celebrations, took advantage of the stronger gold price, UK-based analyst James Moore wrote.

"Continued investment interest and safe-haven positioning as concerns grow over Iran's nuclear policy and the victory of Hamas in Palestine will provide gold with good scaled down support with the metal still looking set to target $575/oz in the short-to medium term," he added.


Another "analyst" who is all over the map. "Gold will drop, but UBS and others' target remains high." Gold moved against the $ for one day, and they're all "sighing" that it returned to previous contrary directional movement. EXCUSE ME?

All I've witnessed is the last couple days is a chance to flip 33% of my PM equities in a Sinclair-style move and take a couple grand off the table while repurchasing my original holdings.

GoldiloxFord Truck sales fall 7% in December#1411122/1/06; 10:04:43

CNBC story -

It looks like Santa just didn't bring the normal allotment of "big boy toys" this year.

silverportTHE GREATEST COUNTERFEITER#1411132/1/06; 10:06:54

News has been released that one of the biggest counterfeiters of all time has retired.The unnamed man in his late seventies started nearly twenty years ago,and has masterminded the operation from Washington ever since.Many trillions of currency ended up overseas where he was seen in the company of presidents'sheiks and prime ministers.As he looks forward to his golden retirement,only time will tell the damage that has been done to America,and the authoritieshope he will not be followed by someone even worse. Proverb-Life is either comedy or tragedy,give us the wisdom to know the difference.
GoldiloxGold Stories on CNBC Bubble Vision#1411142/1/06; 10:21:13

Don't know if they are changing their tune or just pandering to their latest gaggle of advertisers, but they seem to be increasing coverage.

Now they're interviewing Mark Burnett, the producer of Survivor about a new online "reality" game, using AOL as a hub for "clues" to a gold treasure hunt called "Gold Rush".

TC has been handing out daily "clues" to finding your personal gold treasure for years!

TownCrierOK, treasure hunters, here's a clue...#1411152/1/06; 10:36:43

See link for treasure contact info. A sure thing.


DruidGoldilox (2/1/06; 10:21:13MT - msg#: 141114)#1411162/1/06; 10:47:59

Druid: Now, all we have to do, is dress TC up accordingly (chearleading outfit of some sort) and get him a spot on bubblevision(CNBC) and $1,000.00 per ounce would be but a speed bump along the way.
Black BladeGoldilox - Treasure Hunt#1411172/1/06; 10:51:25

Ever see the flick "It's a Mad Mad Mad Mad World"? This "Teasure Hunt" sounds like a similar setup to have a bunch of crazy people racing about the country to beat each other out of caches of gold. Could be ... shall we say "interesting"? ;-)

- Black Blade

GoldiloxCheerleading#1411182/1/06; 11:10:23


TC in a short skirt and wool sweater. Not an enticing visual image!

I bet he can handle the pompoms, though!

DruidDoh!#1411192/1/06; 11:39:15

Druid: This is it. We somehow get TC on bubblevision. His story, TC has been painting portraits of shiny for some seven plus years now and would like to paint one during a live broadcast. The difficult part here would be selecting the prettiest coin because, well after all, we're trying to reach out to the "smart money".
GoldiloxPrettiest coin#1411202/1/06; 11:55:28

@ Druid,

As an animal lover, I would vote for the Panda or the Roo, although the Philharmonic is very nicely done.

SmeagolMusings...#1411212/1/06; 12:17:06

Hmmm... let's ssee, precious... gold and silver in a supply deficit... much more metal leased than is available... metal obligations coming due or overdue... we are thinking ssomebody is going to kill two birds with one London Good delivery bar here, because during the revaluation, SOME metal will be chased from weaker hands - after all, many WILL happily trade in their metal for a profit along the way, not knowing the rest of the sstory - and maybe those in a bind will get enough metal to ssatisfy the backlogs and fix/avoid defaultss?


RimhTC - your link to the treasure clues...#1411222/1/06; 12:37:00

Is it short for "we bads" in traditional smeagolese....

(just kidding - nice pics!)


SmeagolTo ssee It... is to want It! ~8-)#1411232/1/06; 12:50:06

TownCrierTreasuries slide as supply accentuates Fed fears#1411242/1/06; 13:19:11

NEW YORK, Feb 1 (Reuters) - U.S. Treasury debt prices sank on Wednesday as the prospect of fresh government borrowing and the possibility of more interest rate hikes by the Federal Reserve sent benchmark yields to 10-week highs.

In the debt-issuance bonanza it calls a quarterly refunding, the Treasury said it will sell $48 billion in new debt, more or less in line with Wall Street expectations.

But the mere thought of absorbing all that issuance put traders in a cheapening mode...

... the oncoming barrage of supply overwhelmed bulls...

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

Unprintable gold metal is the superior reserve (savings) alternative to unlimited IOUs.


USAGOLD Daily Market ReportPage Update!#1411252/1/06; 13:53:00">
The Daily Gold Market Report has been updated.

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WEDNESDAY Market Excerpts

Gold trades two ways, profit-taking meets dip-buying

February 1 (from Reuters) -- Gold futures in New York slid from a 25-year high on profit taking on Wednesday, but sentiment generally remained upbeat on prospects for continued near-term strength in the market, traders said.

Investors mainly were adjusting positions slightly after a fund-led rally that powered gold to fresh quarter-century highs this week, and no fundamental factors had changed to spark any sustained pullback, said market sources.

"There was some profit taking, probably some investment bank positions squared up, that took us lower," said a trader at a precious metals refiner in New York.

COMEX April gold futures settled at $574, off $1.50 on the day after patrolling a range of $576.40 to $567.60.

Heavy selling pounded gold lower in early trade, but bargain hunting emerged at the mid-$560s area.

"I think the dips are buying opportunities, a chance to do business down at prices that others might have missed," said the trader.

"That gives us stronger sentiment and a base in the market for higher prices, so the rally is looking better and better in my eyes."

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

TownCrierGold rush continues despite soaring prices#1411262/1/06; 13:58:25

(India Business Standard) February 02, 2006 -- Gold rush continues despite soaring prices
Our Regional Bureau / ChennaiFebruary 02, 2006
If the sales at the jewellery shops in the city are any indication, the soaring prices of standard gold does not seem to have affected the demand for gold jewellery during this wedding season.

Jithendra Vummidi, partner, Vummidi Bangaru Jewellers, says: "Usually a rise in the price of gold is followed by a fall in the price. However, in the last six months the price of gold remained on the upswing. As a result, people have stopped waiting for the price to fall to buy gold, which was the case whenever there was a rise in the price. Moreover, as it is a wedding season, the customers cannot postpone buying of gold."

Vummidi added that more than 50 tonnes of gold worth Rs 400 crore is consumed by South Indians during the months of January and February, a wedding season.

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

When your choice is between surplus paper or solid gold, always go for the gold.


FlatlinerThoughts of Skeletons #1411272/1/06; 14:41:14

Included herein are words that I fished out of the archives. Written in May of ’98, it seems that they will never get old.


The urgent drive to create a new "reserve currency" began in the early 80s, after the last small "gold war". The road to making this new Euro did never include gold in large amounts, until the last few years! Even one year ago, the news would say, 5% or less. Today, we speak of a much greater amount! This is interesting, yes? The BIS did "hatch" this deal in a very late fashion! [1>]The future of the Euro was found to be "weak", as the Middle East oil imports onto the continent would continue in dollars! This was so from the dollar being made strong in gold [<1]. [2>]Gold priced in dollars at near production cost, offered a "no switch currency" position, for oil [<2]. This position has been unstable for the last year, and the alternative of a switch to gold was in progress! You have read my "Thoughts" before. Now the BIS does offer to "change the rules of engagement", a real reserve currency is offered!
Few do grasp what is happening and why! They think the holding of gold reserves by the Euro is of a little point, as to what good are gold reserves? One cannot use gold as Marks or Yen to intervene in currency market to support the Euro. My friend, the BIS has played the, as you say, "big poker hand"! [3>]The holding of large reserves by the ECB and the withholding of sales from the market will not only bring the end of the London paper gold market, it will, thru a high USD gold price, "make the dollar weak in gold"! [<3] [4>]From this position, the dollar will lose the "oil backing" from the Middle East! [<4] [5>]At first, all oil for Europe will be in Euro's, then all producers want "strong currency"! [<5]
There is more: Many say, how to defend Euro without much currency reserves? If gold go to many thousands US, what will be used to bid for Euro as defense? I say, these persons will find a problem on their computer screens! You see, the Euro will start as "nothing", no holdings of size, anywhere! The dollar is held as reserves as "the stars in heaven"! It is to say, [A>]"the dollar will bid for the Euro"[<A], not "the Euro will bid for the dollar"! All currencies will "flow into the Euro for trade". But, if the Euro becomes so strong, how to compete in world trade? [B>]It will be the price of oil that will make the "trading field" level! [<B] [C>]The soaring US$ price of gold will make even a 10% Euro reserve be as 100% today, in USD! Oil will become, very, very cheap in Euros and allow that economy to do well! [<C] Many other countries will see this and also want to join the new "world reserve currency" that has become"the new world oil currency"!
:End snip

[1] Here, Another references the "Strong Dollar" and the perceived weakness of the Euro. When I first started following words in this forum I had a different view of a "Strong Dollar." This article helps for anyone that is unfamiliar with the topic ( To sum it up, the US dollar is so strong it could buy many times the amount of gold in the world. Anyone holding US dollars has found it easy to buy gold. Putting this together with Another's words, it seems that the Euro snuck it's way into the global arena and the creators of this currency made sure that oil trade continued in US dollars rather then Euros. Oil backed the US Dollar so this was trivial to implement.

[2] Also, we have all learned that miners have been complaining about the low price of gold for years. GATA has done a great job showing us not only that the price has been held down, but that miners have barely been able to make a living. The Oil producers liked it this way because gold came easy. They backed the US Dollar because of this.

[3] The purpose for holding large gold reserves is not so that they can be sold to defend currencies, but rather as a tool by which they can manipulate the price of gold. The idea here is that there is enough demand in the world to exceed mine production. This has been going on for years. CB's have been filling the gap – waiting. As they withdraw supply, the price will jump. Take note here that the CB's of the world are not targeting the Dollar as its function in economic trade, but rather the US Dollar as a direct function against Gold. They are not withholding anything but Gold. They are targeting Gold. If they succeed, we will see gold act very strange as if living through its on little hyper-inflation against the US Dollar.

[4] As the price of Gold goes up relative to the US Dollar, Oil producers will feel shorted. They will no longer be able to buy as much gold with their oil. They will, well, probably not like this. One would think that they would want to receive more US Dollars to make up for the shortfall Ounces/Barrel. During this time, they will probably look around to see what other currencies they can use and make deals in them. At this point, I would expect all currencies to be on a relatively level playing field. No one currency will stand out but clear trade partners (paths) can be seen. Naturally, there is a strong link between countries that trade in the Euro and oil producers. One would naturally expect these links to get stronger.

[5] During the time when new connections are made using local currencies, all currencies will be considered weak. But Oil producers will want a currency that is strong in gold. They will lean towards any currency that is strong in gold. If they don't get it, they will probably demand it. Here, I would expect another oil embargo so as they can make their point very clear to the entire world. Also, I would expect that during this time, we will see the price of gold in Euros stabilize, while the price of gold in US Dollars will continue to be unstable. Given a little time, the Euro will buy more gold then the dollar will thus giving the oil producers what they are looking for.

[A] Meanwhile, everyone today buys oil using US Dollars. They hold them not because they are strong in gold but because they are backed by the Oil Producers. When the Oil Producers demand a currency strong in gold, people will race out of dollars into whatever currency that fits the bill. If that is the Euro, then, the dollar will bid up the Euro.

[B] The Euro will not be forced out of international trade because of its strength. This is the problem that we have right now when too many countries race to buy one currency. That currency becomes so valuable that no one will buy the exports from that country. Thus, international trade comes to a standstill. But, the price of Oil will level the playing field because the price of Oil in Euros will be really cheap. Where as the price of oil in other currencies (US Dollar) will be really expensive. Here, one would expect that at some point Oil in Euros may be 40 while Oil in US dollars may be 400. If you really think about this, it will be very expensive to manufacture something in the US and try to sell it internationally. At the same time, the strength of the Euro, being 10 times that of the US Dollar will make their goods *relatively* just as expensive to buy. Thus, Oil, priced differently in these two currencies may (will) balance the trade problem.

[C] If a country holds currencies on reserve in order to buy oil, then a small amount of Euros on reserve will be like having a large amount of US Dollars. The strength that everyone has seen for years in the US Dollar will gradually change to that of the Euro.

Now, I may have this completely wrong, but it just seems to make sense to me. Reflecting on this scenario, it appears that we are in a revaluing process right now for the price of gold. The function of this revaluing process is to make the US Dollar weak in gold. The by product of this action should be clear – the US Dollar will lose the backing of Oil producers. Oil producers want a US Dollar strong in gold. How high does the price of gold have to go relative to the US Dollar for the Oil Producers to give up support?

Would current prices be enough? Actions around the world seem to point to the fact that Oil Producers are securing deals, in private, based on trade rather then US Dollars. It would appear that the US Dollar backing is losing strength. But, the price of gold is still going up relative to all currencies. I would expect that at some point, we will see the Euro stabilize whereas the US Dollar's price of gold will continue to rise.

In other words, if the Oil Producers drive the price of oil up in US Dollar terms in order to make up for the US Dollar weakness in gold, the Fed will be forced to print lots of Dollars in order for the world to have enough US Dollars to buy oil. This will continue to weaken the US Dollar in real terms. At that time, we should see the Euro and US Dollar diverge on the world markets. At that point, the Euro will start to gain strength and we'll see a lower oil price in Euros then US Dollars. There will just be too many US Dollars floating around.

Ah! To me, it seems that we are only part way through Another's thoughts (predictions). I would expect that in the near future there will be an Oil embargo to the US. The price of Oil will jump significantly to make up for its weakness with regards to buying gold. We will also see a divergence between the Euro and Dollar but only once the price of gold in the Euro is at a level that works for their system. What that price will be? Who knows!

To quote Another "We watch this new market, yes?"

The Invisible HandBush misfires in drive to end ‘oil addiction’#1411282/1/06; 18:09:41

George W. Bush runs the risk of alienating the world's biggest source of oil with his plan to end America's "oil addiction", Opec delegates, oil ministers, energy experts and even some environmentalists said yesterday.
Only last year, Ali Naimi, Saudi Arabia's oil minister, called on the US and other oil-consuming countries to give producers a road map of future demand to help petrostates decide how much to spend on new production capacity. Such a road map would also help the industry avoid the pitfalls of the 1970s and 1980s, when producers spent billions of dollars on new oil production only to see demand drop – in part because of new US and European energy policies – and capacity lie idle for nearly two decades.

Mr Bush has not heeded that call, Opec delegates said.
The Organisation of the Petroleum Exporting Countries on Wednesday warned that President George W. Bush's proposal to reduce US dependence on Middle Eastern oil could badly jeopardise needed investment in Gulf oil production and refining capacity.
Opec delegates and officials said the group planned to make this point in its as yet unpublished commentary in the cartel's January bulletin next week.


Why did Belgian leave?
Think deeply.
The war is starting in the open.

mikalGold#1411292/1/06; 18:20:26 Going For Gold - Toronto Sun - February 1, 2006
The Invisible HandGreenspan Associates – three snips#1411302/1/06; 18:30:46
Although he will turn 80 in five weeks, Greenspan has no plans to retire. Instead, he will return to running his own economic consulting firm - Greenspan Associates.
From 1954 to 1974 and from 1977 to 1987, Greenspan was Chairman and President of Townsend-Greenspan & Co., Inc., an economic consulting firm in New York
In addition to consulting work, Greenspan also plans on giving speeches and writing a book.
Apart from setting up his consultancy firm, Mr Greenspan has been working on a book on international economics, which will draw on the history of economic thought.

Chris PowellCredit Agricole brokerage endorses GATA and warns clients: Start hoarding gold#1411312/1/06; 19:14:01

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mikalOptions, derivatives etc#1411322/1/06; 20:08:25 "Program Trading has risen from 19% of listed NYSE volume on average in 1999, to 56% on average, today" - Midas report

Rook.,.#1411332/1/06; 22:00:38

Towncrier, great photo of gold coins.
mikal30 yr debt back, "to help finance the deficit"#1411342/2/06; 03:54:16 30-year Treasury Bonds to Return Feb. 9 - Martin Crutsinger - AP - February 2, 2006
SundeckPutin and gold#1411352/2/06; 03:54:53

More details on gold goings-on in Putin's Russia...


The agencies have until February 15 to present a report on measures aimed at stimulating exploratory work to discover new gold fields.

They also have until February 15 to present a report on the expediency of exempting the sale of gold ingots to members of the public from VAT and lifting restrictions that keep them from possessing such precious metals.

By May 15, agencies must submit a report on setting up transport and energy infrastructure in Siberia and the Far East to stimulate the development of mineral deposits with funding from the federal budget, regional budgets and private investors.

The actual measures attached to the first two aspects of the gold market must be drafted by March 1, and the government is due to resolve the infrastructure problem by June 1.

In addition, the Central Bank has been given until April 1 to consider a possible increase in the share of gold in the country's gold and Forex reserves, including by acquiring gold on the domestic precious metals market.


Note that it is not "ore", but concentrate (and probably gold dore) that should be refined in Russia. Note also the measures and deadlines attached to increased mining of gold in Russia, encouraging investment by the public, and for increasing gold reserves at the CB.

Mmmmm...sounds a bit like measures being implemented in China...the days of the dollar are done...there's only one thing that is as good as gold!

I find it a teensy bit intrigueing that gold issues are being voiced at the head-of-state level in Russia (Putin)...there are probably two reasons for that:

1) So that the Russian people, industries and the various intermediaries (bureaucrats et al.) are under no illusion about the trend in official policy, and

2) A most powerful signal is sent abroad...especially to the keepers at the dollar's gate...


mikalVideo daze#1411372/2/06; 05:19:53 | 02/01/2006 | Avoiding the hard questions
mikalWhat is a U.S. debt "ceiling"?#1411382/2/06; 05:53:42 DEBT LIMIT... WE'RE NOT THERE YET - Ed Henry
A humorous look at the obligatory, contorted pilfering forever increasing limits to unknown regions...

TownCrierTreasure seeking#1411392/2/06; 06:34:03

(see url)

Gathered from around the world to dutifully serve at the pleasure of your portfolio.

Superior savings, fit for a king. You, too, can rule your destiny.

Call USAGOLD-Centennial today. TOLL FREE 1-800-869-5115


Clink!Gold in Russia#1411402/2/06; 06:58:08

It occurs to me that some of the "liberalization" of gold ownership in Russia might be due to the pervasive distrust, particularly among the affluent, in the manipulation of the rouble. Overprinting has led people to store their wealth in something more solid, and US FRN's have been stuffed in mattresses for years. This new activity from Putin might indicate :
1/ That he realises the danger of dollar devaluation and wants to protect his people from it (ROFLMAO !) or
2/ That he realises the danger of dollar devaluation and wants to protect his own skin from a suddenly-poorer, disaffected populace.
3/ Something else ?

One thing that it would apparently NOT be is to stop the balance of payments deficit in dollars - gold exports must be a drop in the ocean compared with oil and gas.


TownCrierRussia gold and currency reserves increased to record-high#1411412/2/06; 07:01:19

Itar-Tass reports today that Russia's gold and currency reserve has grown by $3 billion on the week. It is up $5 billion since January 1st, 2006, and now stands at $188.2 billion.

Please note, however, that this need not represent an actual inflow of additional currency or metal... depending on the frequency of MTM accounting operations.

As you'll recall, on January 1st Russia embarked on its new (euro-style) accounting regime by which it evaluates and marks its gold reserves to market value. I have yet to confirm the frequency of the MTM revaluations, but will pass the info along when I do.

(FYI, the eurosystem currently does this on a quarterly basis.)


TownCrierJapanese gold investment#1411422/2/06; 07:12:51

February 02 2006 - Australasian Investment Review

Gold prices have strengthened again in recent weeks as investors choose the metal as a safe investment given uncertainty in the Middle East thanks to Iran and the Palestinian elections.

Macquarie points out much of the buying interest for gold has come from Japan, where an increase in liquidity and a shift in asset allocation have resulted in significant interest in the metal.

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

Famously high levels of papery "savings" in Japan, all just itching for some tangible peace of mind. A gold rush stampede is just one spook away.


TownCrierKorean reserves rise to reflect dollar's drop#1411432/2/06; 07:30:08

February 03, 2006 -- According to the Bank of Korea, the nation's foreign reserves amounted to $216.9 billion as of Tuesday, up from $210.4 billion a month earlier.

The weaker U.S. dollar increased the conversion value of non-dollar assets, the nation's central bank said yesterday.

Foreign reserves consist of securities and deposits denominated in foreign currencies along with reserve positions for the International Monetary Fund, special drawing rights and gold bullion.

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

Here's an example of a central bank acknowledging revaluations of its various reserves as a reflection of a stronger or weaker dollar as the denominating unit of account.

However, for the purpose of balance-sheet assessments, since its primary liabilities are in terms of its own currency, the won, 'best practices' would suggest that the Korean central bank ought to consider using its own currency as the basis for MTM assessments and revaluations of its various reserves on the asset side of its balance sheet -- and certainly this includes the value of its gold holdings.

Have we lost anyone?


TownCrierIn case you missed the subtle issue at hand...#1411442/2/06; 07:47:36

With regard to items on Korea's balance sheet, as the dollar declines in value, you saw in that example that the dollar-denominated market value of non-dollar assets would climb. And just a little thought should convince you that the dollar-expressed value of the non-dollar won liabilities would rise too.

At first blush, it seems that everything stays in balance.

However, you have to consider what happens to the portion of reserve assets that are themselves held in the form of dollars.

Because these dollar assets are on par with the measuring unit being used in that example, they would NOT rise in MTM value as the dollar declines, and hence would pose a risk of causing a gaping hole on the asset side of the balance sheet at any such time as the dollar weakens.

Use of 'best management practices' aims as addressing exactly such a ridiculous state of accounting and the potential dislocations that can result -- such as seen in the Asian contagion of 1997.


TownCrierYen slides on monetary policy fears#1411452/2/06; 07:59:10

(FT) February 2, 2006 -- The yen tumbled in European morning trade on Thursday amid further signs that the Bank of Japan is not yet ready to abandon its ultra-loose monetary policy...

Toshiro Muto, the deputy governor of the Bank of Japan, undermined the yen by saying the conditions are not yet right to end Japan's policy of quantitative monetary easing, in which additional liquidity is pumped into the nation's banking system.

Barclays Capital warned that with inflation starting to turn positive, real interest rates are likely to be negative for a "considerable period" after the removal of quantitative easing, which it sees as negative for the yen.

Steven Pearson, chief currency strategist at HBOS... saw Japanese retail investors continuing to pile into gold, selling yen in the process.

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

The amount of gold that these world-famous Japanese savers "pile into" could become a mind-numbing figure if they become sufficiently spooked or otherwise drawn into stampede mode.

For best prices, choose gold while the market remains as calm as it yet is.


TownCrierGold Reaches 25-Year High as Oil Gains Renew Inflation Concerns#1411462/2/06; 08:46:51

Feb. 2 (Bloomberg) -- Gold rose to a 25-year high in London as gains in crude-oil prices increased speculation that inflation will accelerate, eroding the value of assets such as stocks and bonds.

Gold rose 18 percent last year in London as investors bought the metal as a hedge against record oil prices stoking inflation. Oil rose before the United Nations' atomic watchdog meets today to consider referring Iran's nuclear program to the Security Council, which may impose sanctions on OPEC's second-largest exporter.

The situation in Iran is a "double whammy," for the gold market, Norman said. "It increases geopolitical tension as well as oil prices, both of which are good (i.e., price-positive) for gold."

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

Rather than thinking of unfriendly high prices, another way of interpreting comments that gold is at "a 25-year high" is to realize that gold today can be bought for the same price as 25 years ago.

That sure sounds like a bargain to my ears. Given the population and economic growth along with all of the money-creation that has occurred around the world during the past two-and-a-half decades, how many other things are you still able to buy today at 1981 prices?

When viewed from many other lands, in terms of other currencies, those 1981 prices are long, long gone and gold has been simply been trading at progressively higher ATH prices exactly as you should expect it to.

Take advantage of the dollar's remaining legs and pick up your share of gold now in 2006 at user-friendly 1981 prices.

Call USAGOLD-Centennial today for consultation and best prices.

TOLL FREE 1-800-869-5115


MKTo: All. . . ."Check-in Day" for Table Round veterans and newbies: Are you out there?#1411482/2/06; 11:08:21

I'm getting quite a few questions from industry friends and clientele about whether or not I think the current gold trend is likely to continue. I will summarize my response this way:

We are on the same trend line described in "The ABCs of Gold Investing" (the same Disturbing Trends, continuations of the same reactions in the investment markets discussed, same economic path, etc.), but simply at a different, more advanced, point. Nothing has changed in terms of the causes and effects outlined in that book. Nothing has intervened by way of government or central bank policy or action to alter the trend.

So, how high is high?

That is a matter of currency values, i.e. what your money can buy. It doesn't matter in the overall analysis if gold trades for $200 per ounce or $2000 per ounce. It only matters if you have an asset detached from the paper money markets. Take a look for instance at what gold traded for during the Nightmare German Inflation (as outlined here recently by TC). Such an asset is gold. If you do not own gold, you have not only forsaken the gains of recent years, you have lost purchasing power on the currency sitting in your accounts. In short, you've gotten the double whammy.

If you are thinking about buying gold (as a newcomer or gold market veteran), do you really believe that the Chinese government or the Gulf sheiks given the opportunity wouldn't trade as much of their piles of paper for as much gold as they could at $1000 per ounce? That they would even hesitate given the circumstances?

Please take some time to ponder that question. What is stopping the Big Buyers is lack of availability in quantity and nothing else. As someone once asked here: Wouldn't it be in your best interest to follow "In the Footsteps of Giants?" (Go to the Gold Trail link above if that Thought is new to you.)

What is important for you to consider is not the price of gold, but the underlying forces driving the investment markets at this juncture, and that is what this Forum is all about.


Every once in a while, we have a "Check-in Day," wherein all the Table Round veterans post a note to tell us they are still around, and lurkers and newbies can simply say they're here watching and reading. It's good for those who take the time to post their thoughts and opinions here to know that there are people reading. It's important for all of us to know that there are others of like mind out there who appreciate this venue.

I thought today might be a good day for that. We haven't done it in awhile. You might add how you feel about the gold market at present for the general readership, but its not mandatory.

So, we invite you to say hello and extend our thanks in advance. . . .

Voyager."Check-in Day" for Table Round veterans and newbies#1411492/2/06; 11:20:30

There are differing positions on the Federal tax rate on capital gains of:

Bullion Gold Coins
Pre-33 Gold Coins
Silver Eagles
Silver Dollars

I was hoping to get others experience on this issue.

Thank you

YGMMK#1411502/2/06; 11:30:03

Here? you bet Michael, everyday as time permits. What do you think of Chris's report on the French Bank/Brokerage commentary, ie; Gold to $900. w/ possible spike to $2K... That kind of report/comment would have been unheard of in past. I firmly believe GATA is/has having/had a profound far reaching impact on Gold awareness. I know I have great admiration for their yrs of hard work and appreciation of the voice you have given GATA here on the forum..Regards; Ken
FlatlinerMK#1411512/2/06; 11:35:17

This newbie would like to thank you for this forum. There is still so much to learn. The reason why I find this forum so interesting is because it helps provide meaning behind worldly actions. And, it turns out, these worldly actions seems to always come back to ... gold.

Best wishes.

MKYGM#1411522/2/06; 11:36:28

"What do you think of Chris's report on the French Bank/Brokerage commentary. . ."

An incredible affirmation of what we have been talking here for many years. I also liked the fact that JP Morgan is calling for $800 gold.

Congrats to Chris P, Bill Murphy and the rest of the GATA army for making its most influential financial firm convert to date. . . .

contrarianExcellent Web Site--Stastical Economic Chicanery by Govt et al#1411532/2/06; 11:48:32

Timing of Related Currency and Financial Market Troubles

Central banks, OPEC, corporations and investors, both foreign and domestic -- as holders of U.S. dollars -- increasingly will sense or realize the greenback is headed for the dumpster. It only is a matter of when, not if.

The dumping of the U.S. dollar and/or U.S. debt by investors likely will hit quickly, with little advance notice. All the official actions that in turn could trigger hyperinflation would follow rapidly, with a full-fledged dollar collapse and developing hyperinflation possibly unfolding in a matter of weeks.

When this will happen is the tough question. It could be years; it could be next week. Without knowing the precise proximal trigger of the shift in sentiment against the U.S. currency, the timing is impossible to call. Nonetheless, some early warning signs may be evident in unusual anti-dollar activity in the currency markets, or in unusually sharp and unexplained spikes in the price of gold.

It would be extraordinarily surprising if the ultimate dollar collapse can be held off three to five years, let alone a decade. The pending global financial crisis conceivably could break in the immediate future, triggered possibly by one or more of the following developments: action by China to peg its currency to a basket of currencies instead of the dollar, OPEC pricing oil using a basket of currencies instead of the dollar, a sovereign credit rating downgrade on U.S. Treasuries, a major terrorist act, a very bad monthly trade report, a misstatement by an Administration official or some other event that may appear obvious in retrospect.

geCheck-in#1411542/2/06; 11:50:46

Nice bull market. More than doubled from 250 to 570 in 4 to 5 years. It is stealth (Richard Russell). Most people are not aware of it. It is overbought and is still rising (Sinclair, Russel); a classic sign of a powerfull bull market. Currently at 25 year highs, set to test the all time highs.
Mthirsty1lurking#1411552/2/06; 12:05:21

M.K.I am here everyday lurking,listening,and learning.I recentley purchased the gold starter kit,and have loaned the ABC'S of gold investing to my nephew.We just attened a coin show last weekend,and he asked me why so many people were buying the old bank notes,my reply was that i had no idea.I then posed the question to him as to what he thought would happen if someone accidentley droped a match in that display case.Fire he replied,good answer.We then headed to another showcase displaying gold,Morgan dollars'silver and the like.Posed the same question again,his answer,nothing,good answer.The carpet might burn, in fact the whole disply case might go up in flames.But after it was over the coin dealer would gather up thier gold and coins and continue doing buisness like nothing had happened.It was when we returned home that he asked to borrow my book.I believe that we have another person climbing on the gold train.I will continue to buy gold everytime i have enough fire material to do so.M.
Lothar of the Hill PeopleCheck-in day#1411562/2/06; 12:05:43

Lothar lurks in the shadows at the foot of this noble table daily seeking the scraps of wisdom that fall, and awaiting the adventure of future contest.

The wisemen of the Hill People have just returned from annual pilgrimage to the great houses of Morgan and Stanley. Back into the dark recesses of our ancestral home they bring strange tidings. Many of the words of prophecy seem but babblings to Lothar. They speak of strong economy and market performance in 2006 and poor in 2007. But the strangest of all, they speak ill of Gold.

Seeing the state of Gold now, Lothar wonders what will happen in the poorer times they predict for 2007.

The Hill people continue to accumulate gold and shall watch in wonder.

Fare ye well,

I am Lothar of the Hill People.

Black BladeStill Here!#1411572/2/06; 12:06:37

Still here, watching and waiting. Everything is playing out as expected. We talked about the inevitable rebound for gold in the early days of this Round Table.

The weakening US dollar - actually the weakening of all currencies in the ongoing global "currency war" - means we should expect to see precious metals continue to gain strong international attention. For the US Dollar currency it is a simple matter of the "twin deficits" taking a terrible toll on a battered currency.

More importantly in my opinion are the simple fundamentals of supply and demand. Mine gold production continues to decline after years of weak gold prices and very little exploration for new deposits. On top of that add the liberalization of gold ownership in Mainland China and it's potential 1.3 billion new gold buyers, a rising middle class in India, also the higher petroleum prices in the Middle East leading residents to seek the financial safety-net of precious metals for their flood of petro-dollars, and a resurgence of interest in hard assets and commodities over paper wealth in the west (and Japan).

Other reasons of course would have to include various new gold buyers and new financial instruments from the various ETFs, hedge funds, mutual funds, high-net worth investors and Central Banks that have suddenly "rediscovered" gold.

Ah heck, gold (silver and platinum as well) will continue to gain traction as new fears are realized from new geopolitical concerns emerge and the growing ravages of inflation hit consumers around the world.

It seems not so long ago when the price of gold hit near $250/oz that I had suggested people consider buying gold as "real rates" were headed to "near negative real rates" and "negative real rates" (a clear buy signal for hard assets). A modest accumulation of gold over time ("dollar cost averaging") for "portfolio insurance" then appeared to the the prudent course of action and remains so.

As always, get out of debt and stay out of debt, stash enough emergency cash (or precious metals) for several months expenses, accumulate gold and silver for "portfolio insurance, and start a storage program of non-perishable food and basic necessities.

- Black Blade

performancestill lurking#1411582/2/06; 12:25:37

As time permits, I love to read what the regulars have to say. Most often I feel completely inadequate of knowledge to post my opinion. However, since it is open forum today, I will say that I have become a very strong believer in gold and silver, and went in that direction because I didn't want my $$ to go down in value. Suffice it to say, not only did that not happen, but I am proud to admit my $$ values have actually grown, and recently cashed in some profits on silver to buy more gold. Thanks to all for your thoughts and inspirations and knowledge!!
OvSIndia#1411592/2/06; 12:38:59

Something to keep in
mind. India's middle-
class is larger then
the entire population
of America. They all
believe in gold and
silver and doing very
nicely, thank you.
And why does James E.
Sinclair, that savvy
Mr.Gold, have a house
there? No matter what
kind of reaction should
develop: up and away...

Survivor"You Can Check In Any Time You Want, But You Can Never Leave"#1411602/2/06; 12:48:16

Still here of course, and still ësurviving'. Been doing this since the mid seventies. I really thought 1980 was a ëonce in a lifetime' event since taking the US dollar off the gold standard does not happen very often.

But, here we are again (or still). I see no reason for a change in the current gold bull market. All one needs to do is look at population growth, money supply, dollar purchasing power, and the various types of debt to realize why demand for gold will continue to escalate, and why the ship is too big to turn around anytime soon.

And speaking of money supply -- it isn't just the US dollar that will wash up on the shores of fiscal irresponsibility. Consider that the dollar has lost around 96% of its purchasing power since 1913, yet the exchange rate between the dollar and other major surviving world currencies has never varied permanently by anything close to 96%. That alone tells you that this is a world event which is not tied exclusively to any one country's currency. Instead, think of this phenomenon as tied to the real source of western power: Names like Rockefeller and Rothschild.

All the best to the Ladies and Knights of this table.
- Survivor

SmeagolHotel USAGOLD#1411612/2/06; 12:50:54

(Smeagol mode off)

Officially checking into the Castle, Sir MK. Though I may fall silent at times you may rest assured I am following the Trail here - every day.

You are right about the currency price of gold not really mattering. All that matters is that one hold gold at the proper times - this being one of them - until conditions are such that one's wealth can be returned to useful purpose with minimal loss. At other more sane periods in history one transferred personal gold-wealth daily for many things, but in the current climate I think it is best to accumulate gold and let it "lie very still", "until further notice".

However, I feel that gold will shortly become "unaffordium" for the great majority of people on the planet, and that might matter, even if we are only watching the return of normalcy as far as gold is concerned, because no one alive today has ever seen gold in its proper station, as it was a long time ago, and shall soon be again.

One thing that you bring to my mind with your comments on this "Check In Day" is: This is the first PM forum on my list by a wide margin; I occasionally check several others. One thing that stands out is that as a percentage (judging by the relatively small number of gold forums - and their - traffic compared to "mainstream" financial forums), there are very, very few people in the general public, at least in the US/West, that are even aware of gold now. A much smaller percentage of that tiny slice are not buying physical but are lured to the paper gold arenas. And almost no one is really aware of the ongoing MTM transition (the "underlying forces") or its implications - even in gold forums!

Just how many of us that pass these three tests are there?

The USAGOLD public forum is the only place where MTM is a main topic of discussion as far as I am aware. I see it mentioned on the surface, in regards to the euro, in other places - but not in depth - and I believe that most of those generally aware of gold think that all that is happening now is just some repackaged replay of the past.

As far as where we are going, at least in America, I feel that gold is going to go a lot farther in dollars than anyone is prepared to believe, but this may take some years, and is sure to be accompanied by some vertiginous moments either way, but there is always the possibility that the government or the Fed or the Treasury will do something in desperation, or stupidity, or malice, to rein it in. I wish I knew which central banks were on which side, and which are playing both ends against the middle.

Thank you for providing this place, and thank you and all the others that post here for Thoughts which, in the end, to this poster are as valuable as the precious itself.


ShermagCheck in time#1411622/2/06; 12:54:16

Present and accounted for.

Just letting all know that I read daily, and appreciate all the superb contributions. Keep em coming.

GoldiloxAlive and BUSY#1411632/2/06; 12:55:55


Your entertaining posts have been missed! I am reaching culmination of an IT trade show I am working on, so many hours are being expended getting Exhibitors and Sponsors ready.

Never miss a day at the forum, as it is my home page.

Many thanks to MK and TC for this awesome reference source.

TateWith MK's encouragement:#1411642/2/06; 13:33:00

Hi every one.
With MK's encouragement:
Have not been posting for a long time, and still around.
I miss posters like Oro , Traveler and others. They are good visionaries and help average investor to decipher market fundamentals.

Back in 1997 I remember approaching several major mining executives at Prospectors and Developers show in Toronto, Ontario. At a time I was involved promoting mining investment in several gold and copper deposits located in Russian Siberia.
I received cold shoulder. One of them saying he would like to see successful western projects first before he invest. True, at that time only several companies where producing or near production like: Kinross in Magadan- Far Eastern Russia and High River in Buriat --east Siberia. Multimillion once gold property of Sockhoy Lug was still top secret. I also met with government of Mongolia delegation who only had one English interpreter.

Times have changed. Kazakhstan shortly starts to pump 1 million barrels of oil daily directly to China. Mongolia has dozens of publicly traded western miners ready to snatch new exploration licenses.

Red Lake , Ontario, Canada is a small mining town, probably famous due to Goldcorps riches gold mine in a world. Back in 1936 (around gold revaluation period) town's airport was handling higher air traffic then any other airport in Ontario. These where bush planes coming and going, supplying numerous exploration teams in the area.

We all know how much world monetary system has been abused. Time is coming to pay back. Anything that is phony will be devalued and in some cases to zero value.

It is funny to watch commentators trying to explain gold rise, predicting imminent fall and correction, and next minute picking gold producer as best buy.

Some astute observers like GATA's Bill Murphy informed long ago Chinese visiting South African miners and signing direct monthly gold purchases. Part of newly world produced gold does not see open market it lands directly in coffers of serious buyers.

The other day I had request from private USA interest to provide specifically Canadian gold dealer names. These people are moving their funds out of USA to Canada and into gold. They specifically do not want to deal with US bullion dealers.

Regarding Russian gold refineries mentioned earlier. Russian central bank has first right to purchase gold mined on its territory and has been doing it for some time. Russia, although has bullion refineries , they are Johnson Mathey reputation. Miner prefers to process surplus gold outside country.
Most of gold produced in Kazakhstan today is melted locally and sold in ingot form mainly to European jewelry on contract basis. They are short of local capacity to process low concentrate ore (4-6% Au) and ship it outside for processing.

TateCorrection bellow:#1411652/2/06; 13:50:21

Russia, although has bullion refineries , they are Johnson Mathey reputation.

Should say:

Russia, although has bullion refineries , they are NOT Johnson Mathey reputation.

ThoreaulyChecking in#1411662/2/06; 13:54:16

Some years ago, I asked myself two questions, eventually stumbling on two books that sent me on a journey of discovery that has totallly transformed my life:

Q. What is the State?


Q. What is money?


As for checking in, suffice it to say that my morning ritual begins with this forum (following a quick look at the gold price, of course).

Thanks to all for adding immeasurably to my daily existence.

See you at the end of the rainbow.

USAGOLD Daily Market ReportPage Update!#1411672/2/06; 13:55:42">
The Daily Gold Market Report has been updated.

If you are considering investments in gold we invite you to">request our free introductory information packet detailing the products and services offered by USAGOLD ~ Centennial Precious Metals. We welcome your inquiry and look forward to working with you.

THURSDAY Market Excerpts

February 2 (from Reuters) -- U.S. gold futures surged to a 25-year high Thursday on investment fund and speculator buying sparked by a soaring bullion price, a softer dollar and tensions over Middle East events, traders and analysts said.

The market trimmed its gains slightly in late trading as oil prices fell after U.S. and European leaders played down the threat of United Nations sanctions against Iran, but sentiment remained positive overall amid strong investment demand.

Simmering tension over the nuclear program of Iran, the world's number four crude exporter, has been boosting oil and gold prices in recent days.

Meanwhile, the dollar eased after U.S. intelligence chief John Negroponte said al Qaeda is still plotting and preparing for attacks on the United States.

COMEX April gold futures climbed $2.80 to end at $576.80 after trading a session range of $572 to $579.50 -- the highest price for futures since January 1981.

Dealers said gold looked to be targeting $600 an ounce on bullishness on prices for this year and amid increasing investor diversification into commodities.

Funds with deep pockets have invested heavily in the sector in hopes of boosting returns.

"There is no selling of any consequence (in the precious metals) but any that is around looks to be light profit taking," said James Quinn, commodities commentator at AG Edwards & Sons.

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

otish mountainRoll Call#1411682/2/06; 13:59:13

Have not missed a day in over 6 years except when there was no access to the net.

I'm firmly in the Thoughts of Another camp and have no problem in suggesting $30,000 as a price that can be placed on gold in us dollar terms in the future.
Inflation is coming, and have come to the conclusion that the only deflation we'll have is in things we don't really need.
Where are we in at the present? As Richard Russell stated in his most recent letter (posted on the discussion forum yesterday) the gold bull has bearly lifted its belly off the ground. (or words to that effect)

Thanks MK for providing this fine venue for with it I have been able to now consider myself "outside the box".

MKRandy. . .#1411692/2/06; 14:03:43

Do we have a general idea how many posting codes we've issued since Day One? Would be an interesting sidebar to "Checking-in Day."
TownCrierGold rally not a bubble, could go on up#1411702/2/06; 14:12:59

LONDON (Reuters) - Gold's 37 percent rise in six months to 25-year highs, far from a price-bubble ready to pop, will continue upwards on renewed fund enthusiasm, analysts said.

The bull market may attract even more new money in the coming years, with potential for bigger price spikes, they said.

"Like a gorilla with a gun, gold can go anywhere it wants," said Peter Hillyard, head of metals sales, ANZ Investment Bank.

"With the quest for yield, the need for portfolio diversification and the huge appetite funds have for risk, all commodities are certain to rock for a lot longer. It's not a bubble about to burst."

Analysts say gold has room to go much higher. It is still well off January 1980's all-time high of $850, a level which would now stand at $2,100 after adjusting for inflation.

"I do not see any bubble on the gold market. Prices have been firmly supported by fundamentals. Most notably, changes in global liquidity have put upward pressure on prices," said Michael Widmer, analyst at Macquarie Bank Ltd.

The safe-haven metal is expected to continue attracting buying due to political unrest, notably the Middle East, on worries about inflation and economic growth, instability in currency markets and hopes of buying by central banks.

Almost stagnant mine supply coupled with rising output costs have boosted the metal's allure.

"While sentiment is so strong, it would be foolish to fight the trend in prices," said Alan Williamson, head of commodity research at HSBC Bank.

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

Sentiment continues to turn in gold's favor, sometimes as witnessed even here -- in the typically anti-metal media whose bread-and-butter existance is to support the traditional financial institutions, infrastructure and establishments of Wall Street.


TownCrierMK, the number of posting codes issued since 1998...#1411712/2/06; 14:19:04

2,550 -- plus or minus a couple dozen one side or the other.


BulldogCheck in#1411722/2/06; 14:24:05

Been here since gold was $280. The other day I paid $CAD679
for 1 Maple Leaf. I expect given the message of Bush in the state of the union address that war with Iran is in the future. He says he wants to wean the U.S. from 70% of middle east oil. Doesn't most of the U.S. oil come from us in Canada and from Venezuela?
The year of the Dog will not be good for the world but good for gold. I am of two minds when it comes to gold because a very high gold price will mean a lot of folks will be having a very tough time just surviving.

Aristotle if you are out there check in. Are we in an "ebb"
or a "flow" with respect to the price of gold?

This second wave of the gold bull should be interesting to watch.

The HoopleChecking in#1411732/2/06; 14:39:32

Don't know where I'd be without the insight of this place and the GATA camp. This is an incredible time in history for gold and monetary policies, or rather, lack of monetary policies.

Three things I now know:

Never take advice from someone who has a motive to lie. Bankers, brokers, all fiat paper pushers would qualify.

The mainstream media has a vested interest in disinforming the public about gold ownership. They would be among the biggest losers in a honest money system. G-E, Bloomberg etc. all benefit from the paper game.

"The power of accurate observation is frequently called cynicism by those who don't have it". (G.B. Shaw)

My gratitude for this forum hopefully shows in my purchases from our hosts.

968@ Smeagol#1411742/2/06; 14:40:06

Didn't know the MTM-thing still is such a main topic here ? From my perception, Towncrier and Miner49er are the only knights still active in this castle who still support this theory,.....or am I wrong ??????????

DoubleEagleChecking in and Checking out the charts#1411752/2/06; 14:42:18

I read the forum just about every day, give or take being away from home. Always a great discussion going on, and sometimes I regret I've got nothing to add most of the time. No great philosopher am I, just a true believer.

I was looking at the charts last night, 30 day, 60 day, 1 year and 5 year and they are all "up." Like a beaten down dog I fully expected that after $500 was breached we'd get clobbered back to $450 and spend 8 months to a year grinding back up to $500. Boy was I wrong. It seems almost assured that we'll have $600 by my birthday (March 10th), so let me be the first to say WOW! Here's to $750 by the end of the year.

Black Blade, Gandalf, Smeagol don't go anywhere. The forum would not be the same. And, if any of you happen to share a table with a long-absent trail guide, remind him that we await his return.


Tevyecheck-in#1411762/2/06; 14:58:25

Thanks MK.
I'll gladly check-in.
I'm lurking whenever I can manage it.

Gold. Its Tradition!

Flatliner968#1411772/2/06; 15:15:56

It seems to me, the MTM-thing is a fundamental concept in this forum. To me, this concept implies that Gold is being managed back onto the world stage as the one true international currency that does not carry debt in its handling. The future of gold -- will be phenomenal - as the world comes to understand what this really means. Many here now almost seem to take it for granted, but I am new here, so I might see it from a different (naive maybe?) point of view. In any case, this forum has been a great place to witness the global support for MTM.

But, MTM is just one step in the process. Investigation indicates that the MTM concept what first consider years ago. Laws slowly changed and, now, 30 years later, institutions are brave enough to state publicly that they now hold gold on reserve and value it. Great. But what is the next step?

This is where I have the tendency to lean towards the point of view of previous forum members -- towards the concept of gold as wealth. As we can all see, the PoG is rising in all currencies. Some members see this as the re-valuation period for Gold. I don't take such a rose colored stand. I see this next leg as the redistribution of wealth. The redistribution of wealth does not come without turmoil. This is what I am not looking forward too.

Hold your gold and plan for the future. You may find that the gold you hold will have value *way* beyond the price that it brings in the open market.

Meanwhile, this forum is a great place to follow in the footsteps of giants.

SproutIm here #1411782/2/06; 15:20:10

just out hiking the back forty (Gold Trail) and
ran across an oldie but a goodie...

FOA (10/25/01; 17:19:54MT - msg#125)
More Thoughts and Comments from the Trail House

Another thing we can count on and I mentioned this before:

The moment England is seen as even a "virtual" member of the Euro club; the world will jump on every physical ounce of gold available at whatever dollar amounts anyone will part with it,,,,,,,,,,,,,,,,, and sell every paper gold play into the dirt in the process!!

I say, know your dealer, buy your bullion early and watch for this act to begin. It's closer than you think!

Thanks for hearing my thoughts

Then ran across this lil tidbit today, while I was giving my hiking legs a rest

snips -

Blair 'optimistic' over EU future

There has never been a better time for the UK to play a role in Europe, Tony Blair said in his first major speech on the EU since giving up the presidency.

"Today, we have a shining opportunity to become part of a new consensus about the EU in the 21st century," he said.

Mr Blair said he was optimistic because the "prevailing wind" in Europe was fundamentally shifting.

He argued: "The irony is that, after the shock of enlargement, the crisis of the referendums, the opening of accession negotiations with Turkey and the agreement of the budget with a firm process of reform midway through the next financial term, after all these alarms and excursions there has never been a better time to be optimistic in Europe or enthusiastic about Britain's part in it.

If Your Gonna Do it - JUST DO IT ALREADY!!!!! Sheesh ;)

MoegoldCheck in#1411792/2/06; 15:31:26

Thanks for all the insights available in this forum.

As a retiree whose pension and social security are/will in the future be paid in fiat dollars, I do not look forward to gold moving "to the moon". The dollars I receive will not go very far, I fear. Even though I have been accumulating hard assets for many years and will benefit from gold and other precious metals soaring, I don't think I will like what I see around me because most ordinary people will think they were hit by a freight train. That, of course won't be the fault of gold, but the irresponsible fiscal/monetary system that exists in the world today.

It is great to lurk in a place that bolsters confidence in sound money. Sure don't hear any of these discussions in the financial media.

Golden LionheartChecking in#1411802/2/06; 15:36:18

I rarely miss a day and have accessed the site from Lhasa, Kathmandu, Havana and Myconos as well as from my humble abode near the Western Australian goldfields. It is my security blanket, my morning cup of coffee. Efcharisto poli Michael......and I won one of the competitions!
RimhCheckin' in!#1411812/2/06; 15:48:57

Good reminders, MK! I remain optimistic for short and long term. Medium term is bound to have wild days and rough weeks, but when one considers where we've come from, it's hard to get too upset.
Thanks for hosting the forum - it has attracted a topnotch group of individuals who contribute and add to the collective understanding of all who read and I feel priviledged to participate!


Max RabbitzCheck'n In#1411822/2/06; 16:02:17

Although I've accepted the GATA thesis for several years now, the Credit Agricola report was shocking. A major international bank says these things!!! (Note the Mogambo triple emphasis). First the Russians, now the French. Time to get in line at the gold window again, if you can get there fast and before it's slammed shut.
wileyCheck in Day#1411832/2/06; 16:15:30

I've been checking in every, and Imean every day since '97 or '98. I don't know where to begin. Bought a few Maples just because they're pretty, then found this Forum and my prayers have been answered. I'm one of those idiots that never gave my later years a second thought and then woke up one day wondering how the hell I was going to survive the rest of my life on nothing but good intentions. I started buying whenever I had some spare cash, reading this august Forum (reading because I am of the opinion that the old adage "Better to remain silent and be thought a fool than to open your mouth and remove all doubt." is applicable in my case. I barely made it through ECON 101. That all has changed dramatically, I don't feel that I can carry a conversation with most of you but I"m getting the gist of things a whole lot faster and am able to relate what is happening in the world of gold to my friends and family (of course they look at me as if I was just released from the State hospital but at least I understand me). It has been lucrative hanging out with you boys and girls too as I have hit 2, count em two gold price guessing contests to the tune of .7354 ounces of SHINE. Thank you MK and thank you ladies and knights of this fortress.

Now, I have a favor to ask of any of you that can give me a little guidance. About 3 years ago I took up the hobby of recovering gold from scrap. I have a pretty good source of electronic connectors, circuit boards and I even managed to get hold of about ten CRTs that were plated on the inside. I built a tumbler out of an old ice cream maker, found a source for cyanide (that ain't easy in this day and age) and sttarted running plate thru my contraption. I recovered the gold by zinc absorption. Now I have several pounds of gold impregnated zinc and don't know where I can get it refined. My dillema is that I don't know if the amount captured is worth more than the cost of refining. Anyone (Black Blade mayby?) know who will do a little job for cheap oe for a cut (of what?).?.

One more time, Thank You All, .

Goldman SackedChecking In#1411842/2/06; 16:18:40

Hi Guy's:
We're here, and truly benefiting from attendance, about five years ago I was profoundly influenced by a Grant Jeffery's video on the topic of Gold. Shortly there after I joined the two week free trail on Le Metropole CafÈ and the rest is history. Only recently have I started making USA forum daily monitoring. How has Another and Friend Of Another influenced me? Five years ago I was almost broke. Today I have about 600 oz. of Canadian Maple leafs and about 200K in unheadged tier one and two Gold producers. You've done your Job's well brethren. I'm grateful for this forum and the people who have labored to provide it and contributed to it. Since this is the first time I've herd of Checking In, I'll gladly take the opportunity to salute your efforts and acknowledge my gratitude and thanks

phil288present and watching#1411852/2/06; 16:28:20

I too greatly appreciate all the information available on this site. I have been here daily for four years and as I have been fortunate to take paper profits in the metals casino stock market, I have enjoyed conversations with MK as I convert my paper to something more. Luckily I can still buy at way less than $1,000 per ounce, sometimes it pays to be small. I appreciate the insights gained here, and especially the knowledge avaiable from our host. I don't often have much to say, which is selfish on my part, but then less boring for the rest of you. I regret to say that I think we are on the cusp of events that have no certain outcome. I would urge all of us to continue to spread the word, for the more of us who are relatively liquid in a time of trouble the easier it will be to come out of this more or less in tact. Got gold and sleep well.
R PowellCheck In#1411862/2/06; 16:30:04

Still here + lurking + enjoying the ride.
How about that, sorry, gold!

White HillsCheck in#1411872/2/06; 16:34:20

Every morning with coffee go to usa gold and get the latest info on gold. This is the place to talk about it, read about it and buy it. Thru the years I have touted gold ad nausium to all my friends. I have always recommended usa gold and know that some have called you. Every little bit helps.
MK- found out what a BAHT was. That Thai gold is beautiful. Thanks for the info. Incidently in the small gold market(grams) gold is selling AROUND $900.00 AND UP. premiums are climbing, it is like a TSUNAMI the small wave first and then tidal wave that pushes gold to where? How high can it go? As high as it goes. White Hills
PS. the friends I have left all bought gold

R PowellGold news // BIS#1411882/2/06; 16:35:03

Dr X P Guma: Economic developments in South Africa during 2005 and prospects for 2006 (Central Bank Articles and Speeches) (01.02.2006 15:06)
Address by Dr X P Guma, Deputy Govenor of the South African Reserve Bank, at the conference on South Africa: Today and Tomorrow, London, 24 January 2006. (PDF, 25897 bytes)

...inflows of capital in the form of portfolio and other capital, large direct investment inflows contributed to stronger gold and other foreign-reserve levels. Foreign direct investment into South Africa was bolstered by the...

goldroadlx7checking in along the goldroad#1411892/2/06; 16:45:55

there are many sign posts along the goldroad although i don't read them all, through the years i have read many. i never dreamed that as i walked this long and winding road that i would learn so much about gold, but also that there are so many other intersecting roads, the silver road, platinum road, oil road, paper road, ect ect. yes we can all read the signs but can we interpit them. without this free forum it would not be possible for the average person to make informed decisions about their gold investments. i would like to thank mk another foa black blade ari and so many many more of you folks for the signposts i read along the long and winding goldroad all the best to all of you!!! you guys are good really favorite sign post reads [GOT GOLD] goldroadlx7
BoilermakerStill Ticking and Tracking#1411902/2/06; 16:50:30

The USA gold forum is my second home. God bless everyone who contributes and lurks. Goldbugs are a special breed. No two alike. One thing they seem to share at this place is a passion for honesty and transparency.
That said I have been saddened by the recent disappearence of Ari, Rich, Galearis, and Belgian. I prefer the "big tent" approach to this forum as long as the discussion remains polite and focused. Sometimes I see TC taking a heavy hand with respect to other's views. Intelligence is no substitute for diplomacy. Get you some.

spikedogCheck in#1411912/2/06; 17:21:27

Hello All,

Sorry I'm late; apparently too much Ground Hog Day revelry. Punxsatawny Phil may have seen his shadow from the sun, or maybe perhaps a bright piece of precious was nearby.....

FlatlinerJust watching#1411922/2/06; 17:53:19

NYMEx Issues for February.

Silver 114 or 570,000 oz.
Gold 5,355 or 535,500 oz.

I still question if these numbers really mean anything. But, will watch and learn.

Noble1Check In Day#1411932/2/06; 18:02:48

Checking in today and every day to read and absorb the thoughts of the many knowledgeable posters present at the best gold forum on the net. Thank you MK for constructing and maintaining these halls. (Remember, it is your purchases from USA Gold that support this site).
I miss Belgium already. Hopefully he will visit and post periodically as events unfold.


el doradoCheck in#1411942/2/06; 18:05:34

I've been a lurker and student of the gold trail for over three years. During Christmas I posted a couple of times, but most of all I enjoy reading. Thanks to all who make this forum the first place I check. I'm holding gold (and some silver) as my retirement fund. Sure is beating my fellow workers' funds (hehe).
--el dorado--

Noble1Sorry#1411952/2/06; 18:06:01

The CoinGuyPresent and accounted for...#1411962/2/06; 18:13:16

Going on 8 years now. I've never left the table.



Bound SpiritCheck in#1411972/2/06; 18:17:48

Here in Spirit only.
jenikaChecking in...#1411982/2/06; 18:22:20

Just checking in, I mostly lurk, I have been here since gold was about $320US. It has been the fastest learning curve of my life for which I thank every poster and of course USA Gold.
Iam still on the learning curve and dont feel confident enough to post.
Having said that, I remember either Another or FOA stating that the premiums for gold will rise. This happened this week in my area of the world where bullion premiums went up $10AU, Kangaroos went up $14.
Funny how many people read the forum with a cup of coffee :) I do too but generally late at night. I enjoyed the forum when it was "open forum" as I beleive that helps us get the whole picture but disliked disrepectful posts.
Iam always proud to recommend this forum to others as it is always informative, mostly respectful and not full of rubbish posts. You have all directed me into a learning curve on economics and gold - thank you - from my heart.
PS. I also read the links too!

GoldendomeCheckin in!#1411992/2/06; 18:22:35

Just added .6168 oz. to the Au pile today. Slowly but surely the stash grows over years. Read the site near daily; still posting some? Wonder if Aristotle or Socrates still look this way? Hey-- Miner 49er.

Best, G-dome

Chris PowellA day without the USAGold Forum would be ...#1412002/2/06; 18:34:30

... a day out of the loop.

Checking in with gratitude to our
ever-gracious and expert host, as
well as to fellow posters.

SundeckUS Treasury chief warns of pension black hole#1412012/2/06; 18:39:26



The United States will face a serious problem as the costs of pensions and health care create astonishing deficits in years ahead, according to Treasury Secretary John Snow.

"We're on a path where, unless something is done here soon - in the not far distant future, several decades out - we will see Medicaid, Medicare and Social Security, the so-called unfunded mandates, absorb all of the revenues of the US," he said in response to a question after a speech in Radnor, Pennsylvania.


"Dealing with Social Security last year, you see just how hard it is to build consensus in the Congress to take on tough things," Mr Snow said. "But we have to find the will to do it."


Sundeck: Huh! Now where have I heard something like this before...mmm....Oh yes...O'Neill? Kotlikoff? $44T shortfall, back in 2001 wasn't it?

Back on the agenda is it? Did the Prez say something about this in his Taste of the Onion speech? (Sorry, I didn't watch it...had better things to walking my dog and pulling weeds out of the garden.) Or is Mr Snow girding his loins for the inevitable show-down....

Addressing the "black hole" back in 2001 would have spoiled too many parties, but now? Well, what the Hell, maybe Dubya has decided he can still become a great president by waging war on unfunded liabilities back home...the WOUL.

Flup! Flup! Flup! Flup!

"Wha's that noise? you whuppin' up a batch o' parkin' pigs?"

"No son. Gets you back t' sleep. 'n nither you worry, neither. Tha's just Choppa Ben a warmin' up his helicopter..."


Is it any wonder price of gold is climbing?


ToolieCheckin' in#1412022/2/06; 18:49:51

Where are we now? The beginning of some astonishing times. The pog has been on a persistent climb. Itës acting as though folks are trying to accumulate without spooking the market. Get it, while the gettin's good.
Radcheck in, for wiley refining#1412032/2/06; 19:13:07

Maybe these guys can help
I don't work for them and hope I'm not breaking rules trying to help.
I don't know if it would work with you specific problem.

come by at least once a day

Au-someCheck in day#1412042/2/06; 19:16:41

When the ABC's of Gold Investing came out I bought it, read it - and was impressed enough to check out the website given in the book. The website was I made it my home page. It still is.
I have never expressed my gratitude to the host and to the members of this forum for all of the mind candy dispensed here so freely. Receive it now. Thank you very much.
I often wonder what has happened to posters who have vanished. Where is Traveler??? Anyway, I know where Goldilocks 2 is and she says "Hi!" to all.

GoldiloxSome Markets Even More Overbought Than Precious Metals#1412052/2/06; 19:38:57


The precious metals sector is red hot. How red hot? Cramer upgraded both Gold Corp. (GG) and Pan American Silver (PAAS) with a big Bou-Ya on his show on Monday. I'm hearing anecdotes about how much new Rydex Fund money is going into the precious metals sector and how this is a contrarian indicator. Many excellent and popular technicians are correctly suggesting that the precious metals sector is overbought and "due" for a correction. I've heard one intelligent and articulate analyst compare the action in precious metals to that of Nasdaq stocks in 1999. Numerous are suggestions that the public is discovering precious metals and this is a contrarian indicator. Are precious metals and their stocks overbought? Maybe. Is this a reason to sell? Not necessarily! In these financial markets, there is very little on which one can depend. Stocks are overpriced by any historical metric, and their valuations are being floated worldwide by speculative and liquidity-based buying. Bonds are in an intermediate term trading range with no clear direction and it seems as if their directions are being determined by central banks and not free markets. The one "sure thing" in today's markets is that gold and precious metals and their stocks are in a bull market. In addition to being in a technical bull market, there are strong fundamental cases for precious metals and precious metals stocks. Governments are continuing to print more paper currencies attempting to stimulate their respective economies and manipulate the true value of the massive amounts of US debt. Weakening currencies are bullish for precious metals and PM stocks. Both the technical and fundamental trends for precious metals are now strong and therefore, good for investing for the long term. In my view, investors should avoid trading out of their long term positions for a shorter term gain.

...The preponderance of evidence suggesting that precious metals stocks are in a long-term third wave leads me to the conclusion that it would not be worthwhile to sell and take profit due to an overbought condition. I wouldn't want to be out of my position waiting for a re-entry point because, "Anybody waiting for a pullback to enter will be sorry, because pullbacks will be short-lived and shallow."


Martin Goldberg expounds his suggestion that some other markets are overbought in the rest of the article. What is it that Sinclair reminds us? Markets can remain "overbought" much longer than expected in a raging bull market.

Alchemistchecking in#1412062/2/06; 19:47:05

I have been following forum from the beginning as a lurker. Early on I won a contest and have made this my daily home to enjoy over my morning cup of coffee. I have learned a lot about how our financial system works and am very thankful and appreciative for that.
I do feel that we are going to see significant dislocations to our way of life as the model we are hooked on is well out of control and it becomes more difficult to think how we might excape. Unfortunately that is often how wars start and I think that there is enough ignorance within the powers that be for this to happen.
I am personnaly working digilently on my life to simplify, get by with less instead of more and be as independent of events as possible. With that a lot of my time is spent on sustainable communities and not on posting here but am using what I learn to help structure this.
Thanks to all who have been regular posters over the years and expecially to the hosts at Centennial precious metals for all there energy put into this forum.

da2gCheck In Day#1412072/2/06; 20:00:54

Present and accounted for, Sir!
Whitewaterwomanchecking in#1412082/2/06; 20:24:08

I'm here, watching the roller coaster ride.
innerlineLove the forum#1412092/2/06; 20:38:03

I check out this site almost everyday. I do not have much to say, cause I have been following for three years, which is not much in the golds circles. Thanks to all.
24karatComing out of lurking mode to check in#1412102/2/06; 20:56:35

I stumbled onto this forum 9 months ago and since, have rarely missed a day of reading the posts. On weekday mornings (without the coffee - I don't drink the stuff), I check the discussion before heading out to work. Later that evening I'll check back, along with the price movement for the day.

I rarely post but I do remember joining in a couple of unofficial contests.

I am very impressed by the contributors here. If we could somehow harness the brainpower in this forum, I'm sure we could light up all the casinos on the Las Vegas strip!

Who would have thought that gold would be $572 at this point? Well.....WE DID!!! This is no surprise to any of us here. Nosiree.

Also, many thanks to our hosts. You have successfully brought together many diverse views and opinions.

NomadCheck In#1412112/2/06; 20:57:56


The USAGold email with my password is the oldest email in my inbox (1999). I participated in the Fall, 1999 explosion in gold (from 250 to 340 in a few weeks) and it is one of the fundamental experiences of my life. I remember being long a LOT of call options, going for a 45 minute walk and coming back to find I had both made and LOST $ 500,000. I remember having coins and watching the price drop below $ 260, seeing the experts predict $240 and sub- $200 gold.

As for what the present situation indicates, I think it's pretty simple. During the 80's bonds were the place to be, in the 90's it was stocks. Now in the 00's the hot place is commodities, especially gold and silver. But there is one very big difference - liquidity. The stock and bond market are trillion dollar venues, the precious metals are several magnitudes smaller, thus as we just begin to see Joe Sixpack just beginning to jump on the bandwagon in an effort to once again - get rich quick, I think the entrance gates are going to get FLOODED with buyers. I don't see this bull market ending for several years at a minimum. But there is a downside to all this and that is volatility - the price shocks are going to be big ones, just like we saw during the 90's in the tech stocks - huge moves for seemingly little reason at all.

I think the inflation adjusted former highs for both gold and silver will both be taken out during this ride. It will take some years to do so, but it is definitely coming. The smart money is going to jump on this trend and hang on for dear life, just like with the tech stocks.

This is just the very beginning of one absolutely wild, wild ride. :)

WaveriderChecking in.....#1412122/2/06; 21:00:06

Yes Sir MK - I visit every day!! As per my sentiments for USAGOLD in 2002, I share them here again...this time with Gold heading towards $600.00 and higher!!

One special evening about a year ago,
I discovered O'Mighty Oaken Table of Yore
Which dwells in the CPM Castle of Gold,
And whose essence and secrets must now be extolled

I was welcomed here with both Kindness and Grace
Peoples' words I would read, ne'er seeing a face,
Words of knowledge, and wisdom so dear
A special tapestry, it soon became clear.

A Table where the King, Sir Michael K
Is the Perfect Host in every way,
His knowledge, commitment, and generosity too
Provides the foundation for all that we Goldbugs do.

A Table where guidance on the Trail each day,
Comes from those experienced who've traveled this way,
From the archives of FOA and Another are words
Of prescient thoughts very rarely heard.

A Table where quietly behind the scene
TownCrier works hard and is often seen
Addressing the headlines and announcing the news,
Inviting our thoughts, our debates, and our views.

A Table where Gold rightly Reigns Supreme
As the economy collapses and comes apart at the seams,
Where media lies are analyzed and exposed,
As Truth is unveiled and clearly disclosed.

A Table where intensive Gold study is done,
Economics and geo-politics for everyone,
The only institution on earth with the unique degree -
A Master's in International Gold Studies.

A Table where integrity and noble character abound
In Knights and Ladies who frequent the Round,
You provide strength and sustenance to follow my beliefs
And a place to escape from the world, for relief.

A Table where contests are both fun and fair,
Where Gandalf the White seems always is there,
To sound the "TATA" and announce the event
For prizes so Precious they'll never be spent.

A Table where writing is creative and bold
Siege Engine may become a series I'm told,
Poetry, essays, and writings, all kinds
Weave a mosaic fabric from the many great minds.

A fabric so beautiful you get caught in the thread
Very curious to see where it next will be led,
For we find at the O'Mighty Oaken Table of Yore
The birth of ideas not read elsewhere before.

A Table where Black Blade seems never to rest,
Generously sharing his knowledge and doing his best
To keep us All informed with the DMR,
Reaching Goldbugs everywhere, both near and far.

The FINAL REASON for returning to this TABLE of YORE,
For it's HERE we've become GOLD SISTERS and BROTHERS!


balzacGROUND HOG & CHECKIN DAY#1412132/2/06; 21:10:20

11 YEARS. I discovered this forum whilst I was in Oregon ( I'm Canadian) and I liked it so much better than K.----- that I stayed. I have won a couple of 2nd places in contests and I thank you. But most
of all I love the education.
I saw Balzac Billy come out of his hole this morning and he didn't see his shadow, so winter is almost over. Gold is up again and if we can keep Bush from getting
the USA into another war we might have a good year.
Best wishes to all.


Chris PowellIs the gold price-suppression scheme coming apart?#1412142/2/06; 21:34:41

Latest GATA dispatch.

To subscribe to GATA's dispatches, send an e-mail to:

This email address is being protected from spambots. You need JavaScript enabled to view it.

DruidChecking in...#1412152/2/06; 21:39:04

Druid: ...and many thanks to MK and the fine people at CPM that provide this website for all of us to convene and offer our diverse veiwpoints as they pertain to the subject of gold bullion ownership.
Gandalf the White<;-) YES, Sir MK --- I too am " checking-in " !#1412162/2/06; 22:02:31

Having been here at the TABLEROUND since "DAY ONE", (it truly is my HOME PAGE), I feel honored to have been a very, very small part of your successful "trial" effort of the USAGOLD FORUM webpage. So many great Goldhearts have graced the FORUM with their wisdom (and also artistic efforts) related to the really important matter of education about TRUE WEALTH protection. Because of the comradaeship here, I get a warm inner feeling when I log onto the FORUM each day. "THANK YOU", for your continued efforts !
PS: Sorry to be so late arriving at the FORUM, but I am trying to increase the numbers of hours in each day, as there are far too many things yet to do and so little time. I still have GOLDFEVER and hope even more internet surfers catch it at the USAGOLD FORUM !

LimitUpCHECK IN#1412172/2/06; 22:28:25

To MK and all the posters thanks "a million" To the moon!
Mthirsty1Money show#1412182/2/06; 22:45:16

Alot of gold seminars at the money show tomorrow.
PH in LAChecking in#1412192/2/06; 22:52:34

Greetings MK,

I'm still here almost every day, as I have been since the beginning, too. After all these years, there does seem to be a lot of empty chairs around the table: Another, FOA, and Belgian are especially missed. Would sure like to see them check in once in a while!

Mthirsty1nice#1412202/2/06; 22:54:22

Right on waverider.M.
skicheck-in#1412212/2/06; 23:16:09

Ahh Sooooo.... The Year of the Dog

Per the Rude Awakening .... as of 1-30-06

Silver year-to-date 11.7%
Gold year-to-date 10.1%

Liberty HeadMy State of the Union Speech#1412222/2/06; 23:27:27

When fascism is the trend, gold is your friend.

Best Wishes

timbervisionChecking in#1412232/3/06; 00:54:06

USA Gold is and has been my homepage for several years. Discernment seems to be a sadly lacking element of political and economic life in the West. I believe this site offers a rare place where we can still find some of it.

Thanks a bundle,

KTCCHECKING IN#1412252/3/06; 01:34:52

I check in and look at forum every day, not posting very much at all.

Extremely happy with the gold, silver coins and mining stocks, energy stocks investment. Just sit tight here. Would not sell any physical until FED is abolished.

monTROZChecking in#1412272/3/06; 02:24:57

Checking in.
I don't visit every day, but close. Thanks for the forum, and the coins.

UsulChecking in#1412282/3/06; 02:27:27

I have read this forum regularly since before February 1999 when I started posting, thanks to Michael Kosares and USAGOLD.

Take a look at gold through the perspective of a 10 year chart. You will see that USAGOLD has been educating people since a time when gold was heading towards the bottom of a long bear market, a time when many without such an education would have believed the story that gold was a "dead investment".

About 5 years ago it entered a rising trend which is now quite clear in retrospect. Look in the 10 year chart at the most recent part and you will see a step change in the rate of ascent of the price of gold.

When gold was apparently languishing near $260, no gold was being thrown away! Instead, all gold sold was bought by those who deeply understood its true value and could see past the "gold is dead" rhetoric. Now, gold is being repriced as its true value is being rediscovered.

Consider the total US M3 money stock reported up to January 23, 2006: 10233.5 billion dollars [link]. The US has an official gold stock of 261.6 million ounces. Let us imagine today's pricing of gold in terms of the gold-backed-money era of 1941, when money stock had to be supported by official gold stock. If the official price of gold today were fixed to $572.5, then to match the same ratio of money stock to gold reserves, the official price of gold in 1941 (actually $35) would have to have been 51 cents. This is simply another way of saying that the equivalent official price of gold today would be $39119 in 1941 gold-backed-money terms. But today, we are paying the 1941 equivalent of two quarters and 1 cent for an ounce of gold. Is it not clear that much of gold's true value remains to be rediscovered?

In Europe, the annual M3 growth rate was 7.3 percent in December, and M3 growth has exceeded 4.5 percent (which is the threshold that the ECB says risks feeding inflation) in every month since May 2001. In November 2005, European M3 was 7002 billion euros, and official eurosystem gold reserve assets totalled 377.023 million troy ounces, therefore by the same reckoning as above, the equivalent euro gold-backed money supply valuation of gold should be 18572 euro per ounce (one euro is currently valued at 1.207 US dollars).

MKTo: All. . . ."Check-in Day" for Table Round veterans and newbies: Are you out there?#1412302/3/06; 03:36:38

For those who just brought up the page and are wondering what in the world is going on at the Forum, here's my post from yesterday. I have to say that I am a bit overwhelmed, and that it has been a real treat to hear from so many of you. Let's go for Day Two for those still formulating and those who weren't around yesterday.

Yesterday's post:

Every once in a while, we have a "Check-in Day," wherein all the Table Round veterans post a note to tell us they are still around, and lurkers and newbies can simply say they're here watching and reading. It's good for those who take the time to post their thoughts and opinions here to know that there are people reading. It's important for all of us to know that there are others of like mind out there who appreciate this venue.

I thought today might be a good day for that. We haven't done it in awhile. You might add how you feel about the gold market at present for the general readership, but its not mandatory.

So, we invite you to say hello and extend our thanks in advance. . . .

Cage RattlerChecking in#1412312/3/06; 04:06:46

Lurking since early 1999. Own quite a few Krugerrands. Trade the currency markets daily.
Goldilox Game Over: Kasparov and the Machine#1412322/3/06; 04:23:57


In 1997 Russian Grand-Master Garry Kasparov played IBM's Deep Blue in the "chess match of the century" – and lost! While Deep Blue's victory was initially heralded as a breakthrough success in technology innovation, a new documentary offers a startling twist: that IBM may have rigged the match...


In my often extrapolating mindset, I wonder if buying physical gold isn't similarly upetting the "machine-assisted game" on Wall St., where it's said that some huge % of trades are now "program" trades. "Taking delivery" removes your physical from their electronic paper map.

Anyway, while you're there, check out Tim Ventura''s regular reports on alt-energy research. Probably just the forward looking research TPTB would like to lure out of the wordwork with the funding carrot mentioned in the State of the Onion address.

FreedomCheck In Day#1412332/3/06; 04:27:09

Ladies and Gentlemen,
I've been reading this board since I bought a few Krugerrands at $306 back in '01. Everything here intrigues and interests me no end. I miss Belgian already because I understood his concepts of the changing function of gold. I'll still be here; reading and learning. Thanks for all this Golden (yet free) information.

GoldiloxSA gold output to fall further - report#1412342/3/06; 04:29:15


The South African gold-mining industry is "mature and declining", with both production and employment dropping and expected to continue to do so, says Virtual Metals Research and Consulting CEO Jessica Cross.

As a result, the country should find ways to capitalise on its remaining ounces, particularly through growth initiatives in the downstream industries.

According to 'Gold in South Africa', a comprehensive IDC-, DTI- and AngloGold Ashanti-funded report on the mining, refining, fabrication and trade of gold in the country, while South Africa remains the world's largest gold producer, the country's output has been in decline for over three decades, having fallen at an average of 4% a year for the last 25 years.

In 2004, the base year set for the study, South African gold-mining output fell by a further 9%, to 342 tons, compared with the previous year's output.

This represents a sizeable drop from the 1 000 t produced in 1970, which was equivalent to two-thirds of global supply at that time.

Employment, too, has been steadily declining, at 8,4% a year, since the late 1980s. The decline is largely a result of depleted reserves, which have forced miners to greater depths and at lower grades.


First Russia and now SA report declining gold production. Are we witnessing "Peak Gold" as well as Peak Oil?

NEMO me impune lacessit(No Subject)#1412352/3/06; 04:33:30

Alive and kicking
Humble PieChecking in#1412362/3/06; 04:39:43

MK, thanks for thr forum ,it's like a cup of coffee in the A M and as ANOTHER said Time will prove it all.
SteveHChecking in...#1412382/3/06; 05:09:58

Still paying attention...Keep up the good work!
goldbaroncheck in#1412392/3/06; 05:12:09

Many thanks to those who have graced these pages with the knowledge and patience allowing others to "connect the dots"
GoldiloxPlatinum soars on funds, demand as gold marks time#1412412/3/06; 06:00:25


LONDON (Reuters) - Platinum soared to a record high on Friday, piggybacking recent soaring gold prices and getting a lift from strong demand, while gold itself marked time, traders said.

The bullish sentiment also lifted palladium, sister metal to platinum, to a new 21-month high, while silver traded near this week's 22-year peak.

Spot platinum rose $1,083 an ounce, mainly driven by a rally in Japanese futures.

The metal, used in jewellery and to clean car exhaust fumes, was quoted at $1,078/1,082 by 1048 GMT, higher than $1,078/1,083 late in New York on Thursday. Platinum has gained nearly 12 percent since the start of 2006.

"Gold prices are strong and strengthening and this seems to indicate the strength of investment interest in commodities and precious metals," said Jeremy Coombes, general manager of marketing at precious metals refiner Johnson Matthey.

"The (platinum) market is well balanced (but) not very well stocked because of the deficits of the past few years... Investment interest is taking the price beyond the level we expected," he added.

Precious metals, led by gold, have rallied on investors seeking to diversify their assets because of tensions in the Middle East over Iran's nuclear intentions, dollar instability and firm oil prices.

In Japan, investors who have reaped big returns from trading stocks, have been shifting part of their funds into gold and other commodities to earn larger profits.

"The commodity indices continue to grow -- the majority of the money is coming from there," a fund source said. "It is long-ended money -- two-to-five year commitments, so it is not going to be shaken out."

Palladium rose to its highest level in more than 21 months at $314 before retreating to $312/317 an ounce, still higher than New York's $305/310 an ounce.

"Sentiment towards the precious metals complex remains overwhelmingly bullish, which is hardly surprising given the strength of the price action," said Alan Williamson, head of commodity research at HSBC Bank.

In other commodities markets, copper raced to a new record high of $5,050 a tonne on Friday as investment fund money piled into a host of commodity markets.

Gold dropped from its highest in 25 years at $574.60 the previous day on Middle East tensions and firm oil prices. Spot was at $572.60/573.35, against New York's $572.45/573.15 an ounce.

- Goldilox

Interesting PM action this morning.

TooliePrinting Poverty#1412422/3/06; 06:24:01

Snip: "It is important for us not to lose our confidence in changing times," said Mr. Bush. "It is important for us not to fear competition but to welcome it." (end snip)

All right, let's start by sending Chopper Ben down to scrub "this note is legal tender for all debts public and private" off all that monopoly money. And the dollar can compete with gold. You're not afraid of competition are you?

Maybe America should produce goods in competition for oil, instead of using the federal money monopoly to just print oil, print cars, print textiles and print food.

Our trade deficit was about $750 billion last year that's about 15 million production jobs at $50,000/yr. Compete with who? Chopper Ben?

Ray 1Check-in Day#1412432/3/06; 06:29:52

I have read this site daily for the past 6 years and greatly value the discussion and advice posted here.

Over this time, my retirement fund has grown to be 75% gold related investments and I buy small quantities of physical gold and silver every month.

My wife doesnt think I'm crazy anymore.

Best regards
to All

2023checking in from Texas#1412442/3/06; 07:04:09

Watching and learning daily....cheers

DryWasherChecking in.#1412452/3/06; 07:11:23

I am still here every day reading the forum first before going to the news.

Thank You Sir MK for hosting this forum, and thank you all who post here.

GOLD, get you some.


slingshotGreat Day to be a Goldbug /Check In#1412462/3/06; 08:01:03

This is exciting to see who enters the Castle Gate and once again sits down at "The Mighty Oaken Table of Yore".There are many chairs and all are invited to join in Golden conversation. I first entered the Castle in January of 2001 and was warmly welcomed. Except for the occasional Quest, I find myself always coming home to USAGOLD FORUM. Together we have marched along uneven roads and charged into battle. Knowing that the Price of Gold would rise by painful small increments.Yet it has not been without reward for I have two Silver Maples. One Awarded and the other Won from USAGOLD. Plus a Autographed copy of, "The ABC's of Gold Investing" Thank you again, Sir M.K.
But can you feel it? The tremors within the earth that come more frequent. The snow on the mountain top has melted and steam rises through the cracks in the rock face.
The warning signs are there. The Gold Volcano is about to erupt!

HEY BELGIAN! Where are you off to? Just don't get to far away from the keyboard. Good Luck partner.


SmeagolThere's the notch...#1412472/3/06; 08:08:55

...right on sschedule...


canamamiStill checking in....#1412482/3/06; 08:13:16

...on occasion.

One comment: Geo-political actions do not necessarily revolve around material wealth or economics; that's a Marxist error. People fight for beliefs and values even when to do so costs them money, or their lives.

OvSRollercoaster?#1412492/3/06; 08:38:39

Tsunami hitting gold
and silver--followed
by a volcanic reaction?
We'll see.
Traders, tighten your
seatbelts. Physicalists
enjoy your congnac and
watch the fireworks.OvS

Clink!Check-In Day#1412502/3/06; 08:40:01

I can still remember the shiver up my spine the first time I read Another's Thoughts. It felt like being let in on things kept secret out in the open. All of a sudden, some of the machinations in the world had not only a second explanation (NOT the one on the boob tube !) but also a more logical one. There is obviously the saying "Don't ascribe to conspiracy what can be put down to stupidity" (or something along those lines), but, highlighted recently by the Abramoff revelations, I would rather say the exact opposite. In fact, I would go so far as to say that the "stupidity" factor is probably a feint so that people such as ourselves cannot quite believe that the drivers know precisely what they are doing. How often have you heard here and elsewhere about the stupid CBs, the dumb bullion banks, the crazy hedgers, twin deficits as far as the eye can see and getting bigger. Don't "they" know that this is unsustainable and some day brown stuff will hit the ventilation ?

Well, I bet "they" know exactly where this is heading. Our trick will be to find out and take cover before we become roadkill in front of the steamroller. In the four or five years since I first discovered this site, the world, the US, the economy has been profoundly changed. Me too. I'm betting on being able to say the same again after another four or five.

Take care all,

USAGOLD / Centennial Precious Metals, Inc.GOLD -- solid savings that never loses its shine!#1412512/3/06; 08:47:25

Golden Goal

"Treasure chests throughout history
have been filled with gold, and not by idle choice."

-- R. Strauss

Golden OwlChecking In#1412522/3/06; 08:47:39

It's been over six years since I first surfaced on this forum. You sent me a Silver Eagle for posting on the Four Horsemen years ago. The insight and wisdom contained within this forum's postings are indeed precious and invaluable. The metals compliment our farm lands, related agriculture commodities and inputs, and for the past two years our biodiesel fuel production. I highly regard your regular posters and regularly recommend this site to others. Many blessings to all in the times ahead..........golden owl
USAGOLD - Centennial Precious Metals, Inc.Reap a golden harvest!#1412532/3/06; 08:49:37

For helpful consultation and best prices, call TOLL FREE


Office Hours (Denver/Mountain Time)
8:30am - 6:00pm
Monday - Friday

OvSI Clink! to that!#1412542/3/06; 08:51:27

On the spot.
Da capo.

7nomadsCheck-In Day#1412552/3/06; 09:10:02

Lurker since 99. Simply the best site on the web.
Cavan ManUS Leaders must have "checked out (to lunch)"#1412562/3/06; 09:29:56


US counts war cost: $585bn
From: From correspondents in Washington
February 04, 2006
PRESIDENT George W. Bush is about to ask Congress for another $160 billion ($US120 billion) for the wars in Iraq and Afghanistan, bringing their total cost so far to $585 billion.

That is enough to fully fund global anti-hunger efforts for more than 13 years and provide every child in the world with basic immunisation for more than a century.
Most of the money is for Iraq, where expenses are about $6 billion a month, according to administration officials. The US campaign in Afghanistan is costing about $1 billion a month.

White House budget office deputy director Joel Kaplan said yesterday that Mr Bush would seek a quick infusion of $93 billion, plus another $66 billion as part of the proposed fiscal 2007 federal budget that will go to Congress on Monday.

"War is an expensive proposition. Whether you're for the war or against the war, that's a fact," said Robert Bixby, the executive director of the Concord Coalition, a bipartisan organisation that advocates balanced federal budgets.

The latest figures, provided by officials from the Pentagon and the White House budget office, are a far cry from the Administration's pre-war estimates.

White House economic adviser Larry Lindsey was pushed out of his job when he suggested in September 2002 that the Iraq war could cost as much as $265billion.
Defence Secretary Donald Rumsfeld put the figure at about $66 billion, but told Congress that no one could be sure.

"It's not knowable what a war or conflict like that is going to cost. You don't know if it's going to last two days or two weeks or two months. It's certainly not going to last two years, but it's going to cost money," Mr Rumsfeld said six months before the invasion in March 2003.

In that same period, Mr Rumsfeld's then-deputy, Paul Wolfowitz, contended that post-war Iraqi oil sales would pay for the war.

tejbearChecking in#1412582/3/06; 09:47:57

I have been reading this forum for over a year. It is very informative. I "bought in" at $425. Thanks
OvSComatose, go back to your natural state: comatose.#1412592/3/06; 09:47:58

I had a good laugh.
But don't you know
you are off colour?

CometoseOvs#1412602/3/06; 09:53:27

TownCrier"Papergold" pricing mechanisms vs. flow of actual metal#1412612/3/06; 10:11:32

HEADLINE: No metal exchange for Johannesburg

03-FEB-06; JOHANNESBURG ( -- Research commissioned by South Africa's Department of Trade and Industry has given the thumbs down for a Johannesburg commodity exchange...

"The fact that South Africa is a primary producer of metals does not give it any advantage for marketing it goods through a local Exchange," Lentin told Mineweb in an e-mailed statement.

Competing with the world's larger exchanges would be difficult according to the research.

"Potential new exchanges must either offer product differentiation of some sort or compete head-on with the established exchanges offering the same standard product," said Virtual Metals, "Neither of these options augur well for the challenging newcomer."

Virtual Metals also points to the fact that being a large producer of commodities is not a huge strength in building a commodity exchange.

"The reason for this is that a small percentage of futures contracts come to physical delivery (less than 1% in the case of gold and pgms and 20% or less in the case of base metals) and thus access to this metal, by virtue of proximity to the mines, is not of huge importance," says the report.

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

Think long and hard on that one, and then joyously take ownership of the superior benefits of actual metal while merely paying the presiding price established by its inferior paper derivatives.

The first rule of bargain hunting is to always snap up true wealth while it's being made available at a counterfeit's price!

Call USAGOLD-Centennial for real gold coins and bullion delivered to your door.

TOLL FREE 1-800-869-5115


HOOSIER GOLDBUGMORE OF THE TRUTH!!!#1412622/3/06; 10:54:50

This idea of the blowup of the GOLD CARTEL and FREEGOLD is only theoretical and a pipedream in the minds of honest money principled people! In reality it will NEVER happen! The rules will change to accomodate the CARTEL at the expense of the physical gold holders, miners, mining companies, etc. WHERE is BARRICK and the Japanese firms able to get the money to hold their massive hedge positions and add to them? The exchanges' rules relating to trading conduct are waived for the GOLD CARTEL. The threshold price for total blowup keeps changing all the time! First, $340, then $360, then $420, then $450, then $500, then $540, then $560. Out of the blue, with a scheme no one has ever thought of, they will dodge the proverbial bullet that causes their demise or loss of control. I wonder if that is why BELGIUM, ANOTHER, and FRIEND OF ANOTHER have quit posting on all the GOLD forums. I wonder if that is why ALAN GREENSPAN has abandoned all his views of the integrity of GOLD. They already see the writing on the wall.
FlatlinerFirst commodity ETF#1412632/3/06; 11:02:06


Deutsche Bank launches first commodity ETF

By John Spence, MarketWatch
Last Update: 11:01 AM ET Feb. 3, 2006
BOSTON (MarketWatch) -- Deutsche Bank has introduced the first commodities index fund listed on a U.S. exchange in a move that could signal a major shift for the burgeoning exchange-traded fund business.
The Deutsche Bank Commodity Index Tracking Fund (DBC: , , ) , which began trading Friday on the American Stock Exchange, was up 20 cents to $24.30 in early trading.
The fund isn't technically a true ETF because it's structured as a commodity pool rather than a registered investment company, although it resembles an ETF in many ways.
Friday's launch has been highly anticipated by industry watchers because it marks the first time an ETF-like product will use derivatives in its portfolio to provide exposure to commodities.

There are gold ETFs and a silver ETF is in the works, but the bullion is held in a vault and investors trade shares representing fractions of an ounce of precious metal. Most other ETFs, which are listed on exchanges and trade like individual securities, track stock and bond indexes.
The new commodity ETF is designed to follow the performance of the Deutsche Bank Liquid Commodity Index - Excess Return, which is based on futures contracts on crude oil, heating oil, gold, aluminum, corn and wheat. The two energy futures will be rolled monthly, and the others annually. Other less-liquid commodities such as coffee, sugar and livestock aren't included in the index.
- Flatliner

This is interesting to me. It seems to me that people believe that ETF's are backed by real assets. People are told that gold is held in a vault upon which they have claim to a small amount. Now, we have something that comes along and calls itself an ETF. But, in this case, they hold futures ‘in the vault.’ This to me speaks loads towards liquidity. Why are they calling this an ETF rather then an ET Derivative?

Maybe it is my lack of understanding ETFs, but don't those that buy Gold for ‘the vault’ pick it up in the futures markets? And, those that manage Gold ETFs, don't they only have to provide gold to their big customers – if they demand it (which they don't)?

In a way, I wish Belgian were around because I know he'd jump right in and help me understand. But, he appears to have found someplace else to learn and teach. I will graciously appreciate anyone's time with regards to learning more about this. Thanks.

Flatliner@ MORE OF THE TRUTH!!!#1412642/3/06; 11:15:39

It would be most interesting to see a post from one of these former forum members to see if they agree with you. But, I do remember Belgian always saying that revaluation would occur slow and steady. It's as if he knew that the action was deliberate or controlled.

As to a blowup, big players have always been too big to fail. The Banking system would never let anyone big fail. And, having learned that the futures markets are paper markets where settlement is taken in paper, it would be really easy for the banks to repair any damage that would occur there.

What I see happening is more demand. We all see that. World wide, more people are running towards Gold. At the same time, it appears that banks are creating more ‘products’ to absorb the extra money that flows into the demand. Basically, the system is setup so as to make it really easy for investors to convert into a gold derivative rather then an oil derivative. What that means, I'm still out in left field about. But I do know that more liquidity in gold resources does not mean more faith in the products.

Part of what Another talked about was the loss in confidence in paper gold. It seems that we have yet to come across this. It may take time. In the mean time, one might want to consider buying the actual metal rather then a derivative. The issue really comes down too, do you want to be in control, or are you willing to let someone else control it. Your choice.

Oh, Hoosier Goldbug, I do love the level of emotion that you display in your postings. It has painted a very radical image of you in my mind. Good tidings.

RusteeChecking in - Northern CA#1412652/3/06; 11:25:53

Don't post much but enjoy reading this board daily. In the late 70's I invsested in SA gold stocks and rode them from $2.00 to $20.00 and then back down to $2.00. In this run I have about 250% gain in my gold stocks. What does the board think of this run. When do you sell? I also have physical which is buy and hold for sure.

Mr GreshamSo THAT explains the ringing#1412662/3/06; 11:26:50

in my ears!

August '99 was when I decided the main y2k effect was likely to be risk to the fractional reserve banking dominoes, and a poster on Ed Yourdon's y2k TimeBomb2000 site sent me over here. (Boy, did we have fun there! And it carried right over to here in other ways.)

Only -- this place was like a graduate school in REAL monetary understanding. And it took four years before I felt my intense learning curve leveling off, to where I could let up reading every day. (Someday I'll try to make up that lost time with my daughter, by passing on to her the wisdom gained here.)

Through all the stresses of these past years, and financial reversals, the companionship and mutual sharing of information and analysis here has given me the financial foundation I needed. Thank you!

The potential of the Internet has been fulfilled here through the generous spirits of the owner, staff (yes, YOU Randy) and posters. May your well-deserved prosperity be enjoyed in safety and harmony!

GalearisChecking in late#1412672/3/06; 11:27:28

Couldn't be helped! I have just discovered how leased silver (and gold) is both double counted and infers that COMEX warehouse figures may not be too accurate. As most of this has to do with silver,,,,

Best regards,


omegaman***Check-In Day***#1412682/3/06; 11:34:07

Hello to everyone on the forum from a long time lurker and infrequent poster.

I first found the USAGold sight in the fall of '99 when gold went ballistic. It was early in my futures trading education and I learned more than I ever thought I would just by reading the posts and paying attention. I even had a chance back then, to talk directly with out proprietor, MK, one-on-one on the phone. That was before I made my first purchase from Centennial. Since then, I've made several more. And am extremely happy with the service.

The ride up hasn't always been easy, and at times it seemed like the lid would never come off the Gold price. But now that the journey is in full swing, I'll be sure to keep tuned what's happening at this most gracious Table-Round. I expect there to be fireworks in the not too distant future but, as is usually my fate, I'm more often early than late. Which you could say, or I think someone else said before, who's name I can't recall, "Tis better to be a year early, than a day late."

Enough said from this Grumpy-last one. "Thanks for the info" to one and all

tejbearWorld Trade Unit#1412692/3/06; 11:39:39

Question? For all of the wide ranging reasons for the devaluation by the dollar, I have not seen this forum address the dollar as a declining world trade unit, as described by Murray N. Rothbard in his book titled "WHAT HAS GOVERNMENT DONE TO OUR MONEY". It appears to me that Rothbard has hit the nail on the head. The US has exported our blue collar jobs and is now increasing the amount of debt every day. I would appreciate some comments. Thanks.
White RoseChecking in#1412702/3/06; 11:50:47

I drop by many, many times a day. This is one of my favorite sites. At this point, my family has a lot invested in precious metal stocks and actual metal.

As other have, I urge all to carefully read the document from that French bank that I find so amazing. Just pass this link around to all your friends. When they are ready to buy, suggest they do so here where frank talk about the reality of money is allowed to flourish.

glockmaster19Check-in Day#1412712/3/06; 12:06:05

Love this web site. Awsome commentaaries and links here. I read it daily (since 1999).
1340ccChecking in#1412722/3/06; 12:12:01

Still a very important site for me to gain knowledge about metals and the way the world works.
18KChecking in#1412732/3/06; 12:13:33

Gave myself the above moniker because I wasn't entirely a gold-bug when I first started lurking back in '01. Since then, I've learned more than I can say from the many members of the table round...
TownCrierHoosier Goldbug (msg#: 141262), your defeatist attitude is a real marvel#1412742/3/06; 12:30:28

"This idea of the blowup of the GOLD CARTEL and FREEGOLD is only theoretical and a pipedream in the minds of honest money principled people! In reality it will NEVER happen! ... The threshold price for total blowup keeps changing all the time! First, $340, then $360, then $420, then $450, then $500, then $540, then $560."

First of all, I don't think any of the few "freegolders" ever hung their hat firmly on the sort of "blowup" that you're referring to. Instead, it has always been viewed as something ultimately driven by an official need for a rational revaluation -- which was indeed awesomely high relative to current derivative-based valuations.

Secondly, to the extent that any of the serious and sober "freegolders" may have suggested some sort of calamity or precipitous event as a catalyst for the revaluation, they certainly weren't so pedantically bombastic (as we've seen from other quarters of the internet) as to suggest that there was a specific price level at which a "blowup" would occur. That sort of "analysis" is the domain of those primitive newsletter writers and internet columnists with a penchant for mindless sensationalism.

Why do you, personally, require a "blowup"? What is it about gold's 125 percent pricerise in less than five years has you ranting like this and seemingly less than satisfied with the trend that's underway?


HOOSIER GOLDBUGWHAT I WANT!!!!! AGAIN!!#1412752/3/06; 12:46:20

Gold Price adjusted to 1970 dollars would be $2,000.00+
Gold Price adjusted to the amount of US dollars in circulation would be $30,000+
When we get to either of these levels, then I will think a one month 125 increase is worth noting or picking my interest!

goldenpeaceChecking in...a day late, but not a $ short#1412762/3/06; 13:10:20


walking ANOTHER'S Golden road
in silence and gratitude,
smiling,at peace....

This Discussion Board is my browser home page.


Buongiorno!checking in#1412772/3/06; 13:10:27

Thanks to our host, who bends over backward to be fair to us. We can learn something from everyone who posts here, so a big "thank-you-very-much" to those who visit and "throw a log on the fire"--providing warmth and illumination for the rest!

makcumkaChecking In#1412782/3/06; 13:31:00

Been coming here since 2002, almost every day, and have enough courage to post twice a year or so. Really appreciate everyone's input and education, especially things that I don't understand - stimulates the mind.

Special thanks to MK and CPM, for allowing this forum to exist. Haven't seen MarkeTalk post much lately, guess he is pretty busy, which is a good thing.

TownCrierHoosier, the good news is...#1412792/3/06; 13:47:39

we're heading there. And hopefully without any "blowups".


HOOSIER GOLDBUGDEFEATED, I AM!#1412802/3/06; 14:00:22

If Donald Doyle and Blanchard would have won, settled for the $2 billion they sought to prove was gained illegally by the GOLD CARTEL for GOLDBUGS in the U.S., 138.89 Tons of Gold could have been taken off the PHYSICAL MARKET!!!!! I am sure our gracious host would have liked some of that action! After a settlement for a promise for a 10 year reprieve in shorting Gold, which was/will be broken, I really believe there is NO way GOLDBUGS will win this fight for real money. When the levels get to prohibitive, the rules of the game will change.
Maverick1test#1412812/3/06; 14:18:35

Flatliner@Defeated, I am#1412822/3/06; 14:19:33

Most emotional Hossier Goldbug, surely, time will bring what you want with regards to the price of gold. I'm sure many here look forward to that day and wonder how it will change their lives. Hopefully for the better.

At the same time, I encourage you to not be defeated or even feel defeated. But, rather, educate myself, and those forum members that might read, as to your position. Over the months, I have been most intrigued with your postings, but find them more emotional then logical. Surely, you have or know something, or have inside information regarding something, that it appears that you want to share. Will you please share?

Some have given up the hope, but I continue to take the stand that the truth can stand on it's own if given the chance. Empower others to help the truth stand.

Cavan ManTowncrier#1412832/3/06; 14:30:08

After reading the French Bank's white paper on the state of affairs in the gold market, facts I have understaood for quite awhile, I wonder why the author would recommend any gold shares other than it is their business and commercial intent to sell equities. Further, I have often wondered why the GATA (GOOD) guys, knowing the potential of a major, "blowup" don't exclusively focus on physical. Physical has been my best buy hands down. Like Uncle Harry, gold stocks I beleive are for the trading. 'Tis a puzzlement. In the market soon....CM
White RoseWhy blame Blanchards? Praise them!#1412842/3/06; 14:36:35

Since gold is at 25 year highs right now, everyone who has bought gold from a reputable dealer (such as our hosts) is ahead if they choose to measure their life in fiat dollars.

I state that with mathematical certainty. There is no need to demand $2,000 price or $30,000 price as if this amount is owed.

The charm of gold in this era is that it is an intensely political substance. It is much more political than oil, and we can see all the wars fought over oil (and I count WW2 as a war fought over oil).

Who has been harmed by low gold prices? The peoples of Africa and other gold mining regions of the world. The mining companies. All those who want/need/desire sound money. Some here have also been harmed by low gold prices. Why have we not sued? Perhaps it is because the costs of a law suit are huge. Remember how I said gold was political? Well, law suits are often quite political. It is entirely possible that even the best legal challenge to the gold cartel would have been foiled.

Right now, we are witnessing the beginnings of a short squeeze on physical gold. Dare I say it, it is much more fun to watch the gold cartel squirm in the marketplace than watch a trial.

Of all groups hurt by the gold cartel, Blanchard went to battle against the gold cartel. They hung in there for a long time. JP Morgan argued that they were an agent for a collection of central banks! Amazing! These admissions are helping to fuel the gold cartel's agony. Praise Blanchard for their bravery! Do not slander them for their inability to offer you instant riches!

It is political and it is financial. I suspect that if all the knights and ladies at our web-based round table were to check, their net worth in dollars is up from September, 2005.

I predict that politics, weather, and finances will be very stormy in 2006. Batten down the hatches. Count your dollars, Yen, and Euros. Figure out how much more gold you can still buy before the storm washes over the land.

Tevye(No Subject)#1412852/3/06; 14:52:21

Well said White Rose!

Gold: Its Tradition!

FlatlinerJust watching#1412862/3/06; 14:59:01

NYMEx Issues for February.

Silver 122 or 610,000 oz up from 570,000 oz.
Gold 5,362 or 536,200, up from 535,500 oz.

Total Eligible in golden warehouse is shown at 2,212,684. Total registered 5,105,694.

USAGOLD Daily Market ReportPage Update!#1412872/3/06; 15:11:36">
The Daily Gold Market Report has been updated.

If you are considering investments in gold we invite you to">request our free introductory information packet detailing the products and services offered by USAGOLD ~ Centennial Precious Metals. We welcome your inquiry and look forward to working with you.

FRIDAY Market Excerpts

Gold softens on day, up 1.4% for week

February 3 (from Reuters) -- COMEX April gold futures fell $5.20 to settle at $571.60 after trading between $578 and a two-day low of $569. Gold retreated from its latest multiyear high of $579.50, hit on Thursday, as the dollar rose and as oil slipped back, which limited gold's appeal as an alternative investment.

The dollar rallied broadly on upwardly revised U.S. payroll numbers and a fall in the unemployment rate, which reinforced expectations for higher U.S. interest rates, traders said.

U.S. nonfarm payrolls rose 193,000 in January, below economists' forecasts for a rise of 240,000. But the government lifted its December number to 140,000, from 108,000 and its November figure to 354,000 from 305,000. The jobless rate fell to 4.7 percent, a 4-1/2-year low, compared with forecasts for 4.9 percent.

"A little dollar firmness really dropped it down, although these numbers are, in my view, somewhat inflationary, given tight employment," said a head dealer at a precious metals desk in New York.

"We suspect COMEX-trading speculators have continued to take profits on long gold positions in spite of ever-higher rallies by gold," investment bank UBS said in a daily note.

Temporary technical weakness notwithstanding, analysts said gold still looked to be targeting the $600 level soon, buoyed by instability in the Middle East, tension over Iran, high oil prices and uncertainty about the U.S. dollar.

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

AllanCChecking in#1412882/3/06; 15:30:59

What a novel idea. A check in day.

I still lurk here after many years but infrequently post. Oh yes I'm an avowed liberal and I occasionally want to lash out at a few repubs who regularly post here with their slanted pro-Bush bias, but I refrain from doing it. I simply say to myself, at least we all agree on gold and that's what we should focus on. And thanks to MK for not allowing this site to lose it's focus. This site has been an educational experience and I am much better off intellectually and financially because of it.

I do miss the regulars though. We go back a long way, Another, FOA, Aragorn, Aristotle, Oro and now Belgian?!!...where have you all gone? Thanks to their insights I've kept my focus on the big issues that the mainstream financial media seldom talk about.

All my best wishes to all the regulars and lurkers who visit these halls. I will remain here, not too close but seldom too far.

Ten BearsChecking in...#1412892/3/06; 15:43:43

Thanks MK, TC, and staff for providing a place for an honest exchange of ideas and information references. Concepts discussed here for several years are now showing up in main stream publications and internet sites. Just as the cutting edge in communications technology has allowed people to exchange un-filtered ideas, the cutting edge monetary theories (often rediscovered from the past) shared here are, I believe, opening many previously closed eyes.

Here's hoping we all continue to prosper from the knowledge of your generous posters.

slingshotHello Hoosier Goldbug#1412902/3/06; 16:21:37

Always good to hear from you but you said.

I really believe there is No way Goldbugs will win this fight for real money.

Well I am not in this fight to be defeated. Each new day we have more join our ranks and I might say this is remarkable considering the years of easy money.
The young today buy homes/cars/ boats and other high ticket items and the live for today attitude is pervasive. Only when they are reaching retirement do they feel the pressure and those boats and cars depreciate and by this time the equity is drawn from their homes. If by chance they do have a savings account the percentage is way below what gold has peformed in relation to inflation. Real Money is not defeated just unrealised. Who would have thought GATA would have gone this far recieving recognition from Russia and now from a major European Bank.
The term "Blow Up" to me is not as much as Gold going to extreme price valuation but more to what Joe Sixpack is going to face when fiat is in its Death Throves.
Goldbugs will continue to get their bumps and bruses. As I have said before, This arena is not for the Faint of Heart. I am a Purist, for I enjoy the Brilliance of the Canadian Gold Maple Leaf. Thank you Canada! I am a Realist, for I tend meticulously to my Firearms. A Spoilist, for that is what I aim to do to protect my investment.
On other points.
Congrats to the poster who turned silver into Gold. I think it was a little early. Yet taking a profit and turning into a better investment, WAY TO GO!
Belgian. There is something to be said when a valuable poster leaves this forum in an abrupt notice. Could this astute gentlemen packed up and ventured forth to some South Pacific Island atoll? Following Another and Friend of Another to resurface at a future time. Intriguing.
Sentimental. Slingshot was placed in Good Company with Smeagol. 25 cent gas and a five cent candybar ;0).
To all the Newbies who Lurk at this Fine Forum. Go ahead and post. Yes, there are times that the exchange is complex but if you have a question, I'm sure it will be answered.

Good to see friends are hanging around the Forum.

Black BladeWow! A Few Long Lost Posters!#1412912/3/06; 16:38:55

Good to see a few old names checking in. It has been a long time. I was just randomly looking through the archives. There are a lot of old posters who are MIA. Unfortunately I am certain that there are a few who are no longer with us. Last year Farfel (David Cohen) passed away and did not get to see the resurgence of the precious metals. Still, a lot of people checking in who haven't been actively posting for a while. I raise a ice cold Negra Modelo in salute!

- Black Blade

slingshotFarfel#1412932/3/06; 16:50:11

I raise a Black and Tan.

TownCrierRussia's first taste of life under practice of MTM floating gold reserves#1412942/3/06; 16:53:13

A few days ago I touched on this in a quick post, but here is a more detailed elaboration.

Official stats of International Reserve Assets (for Nov) as reported at the end of December 2005 shows the Russian status with both feet in the "Old IMF" world. Under that regime gold reserves were underutilized, valued at an artificial level, in this case the official book value was $300/oz.

With official gold reserves weighing in at 12.43 million ounces, Russia reported its gold-related liquidity at a value worth $3.730 billion.

Next, having taken positive steps into the "New European" world (i.e., euro-style reserve accounting), Russia enjoyed its first taste of the new regime when a week ago it provided its monthly update of its International Reserve Assets (for Dec).

Not only did Russia put on an extra 10k ounces to its gold holdings during the month (12.44 million oz), it also fairly marked the whole pile at month's end to the then current market rate of $510/oz.

The result was a newly reportable (and more accurate) gold-related liquidity among its international reserves of $6.349 billion -- an increase of $2.619 billion.

Not a bad initial day's work for a paltry 387 tonnes (a nine-foot cube) of yellow metal.

As for a view forward, current market prices are $60/oz higher than they were, so on a MTM-basis Russian gold liquidity has subsequently increased by Another $750 million.

Given this solid (non-debt) view of how things could/should be, doesn't it make sense that Russian monetary authorities would tend to more strongly continue to gravitate toward accumulation of gold (in support of both the int'l market as well as domestic producers) rather than the old system of accumulation of ever more debt-ridden IOUs from New York and D.C.?

Here you see the basis for freegold pricing growing feathers. One day it will fly.


ericchecking in#1412952/3/06; 16:56:31

I have visited most days for a year or so and very much appreciate the forum and it's gold experts. Keep it up!

Many thanks.

ShapurChecking in #1412962/3/06; 17:47:00

I hope all are well! I have been lurking, reading and posting once in a while (even got into a heated discussion with MK about the "great" dr. greenspan)--MK, I thought you were going to kick me off because I took a strong stance against you, but you were tolerant of my opinion.

I think I first came across this site in 97 or 98. Great discussion and much education gleened.

The times have indeed changed since then. Things around the world are coming undone and I am afraid we are in for difficult times ahead.

I miss the great posters. But I enjoy what we have today!

GOOD LUCK, happiness, and health to all!

slingshotRussian Gold#1412972/3/06; 17:58:34

My Question is for TownCrier.
If the Russian Government, as per its announcement to increase its gold reserves, has any effect on the amount of gold produced by any foreign mining corpration as to the exact amount of gold mined? That is to say unreported gold produced ending up in governmental coffers. Could it be that contracts sign with a clause allowing the mining company to operate within its borders only report a percentage of ore mined. This would be conceivable if you take oil and its unreliable amounts remaining in reserve in major oil fields. Who to trust? Drill results bearing large desposits of ore can be easily recanted or can be undereported while the mine continues to operate making a profit but not as much as it should be.The Russians have the right to buy all mined ore produced first.
Trust but Verify

GoldendomeDon Coxe talks Gold, Silver, and Federal Reserve#1412982/3/06; 18:32:14

Due to huge requests, Don Coxe on his web radio cast, talks silver and gold. Listen in at the posted web link with windows media player or Real player.

Don and his guest respond to a recent article in the Wall street Journal which stated, "The Fed shouldn't think about stopping it's tightening given the signal from Gold."

Don doesn't think the that the Fed will pay much attention to what gold is doing--they're more concerned with what inflation in goods and in what the economy is doing.

Don says that the Gold EtF has changed the entire dynamics of precious metal investing and soon the silver ETF will also. The gold ETF is now the 14th largest holder of physical gold in the world. He gives the reasons, many are investing there.

The guest (also from their banking institution) says that they have revised upward from $600 [that's way to easy a call now, they feel] to possibly $800/oz. within 2 years.

The guest sights many reasons for the gold rise. Many which have been covered here in depth.
1) Asian investment--they have a proclivity for gold in all forms.
2)Diversification of $ holders into another asset. Gold and silver (something not paper.)
3)Momentum investing by the hedgefunds. [not necessarily a good thing in the longer run.]
4)Under-supply and under developement of new mines due to low prices for 2 decades.

Don compares the charts of of Gold and Silver with that of other comodities: oil, copper, all the metals and finds that only recently have they over performed in relation.

In relation to the stock indices all comodities are way out front and he notes the shares of some notable recent glamor group growth stocks (e-bay, amazon, google, etc.) that are now underperforming and concludes, that investors are now looking for value instead of growth.

G-dome: Possibly the rise of the metals can co-exist peacefully with the U.S. Federal reserve. That the reported low inflation rates in goods particularily, (even though there may be some hijinks that goes into the figuring) will preclude the Fed. raising rates to put a lid on the gold price rise.

PrometheusChecking In#1412992/3/06; 18:49:27

I've been reading the forum every day since 1998 or 1999. It's one of three places I read every day. I'm constantly amazed how well informed I'm able to keep just from reading this forum. What a wonderful place to come and learn. Thanks a bunch, MK.

I have one request for you, MK. Whenever you post a message you always clarify something for me. You have such insight and depth of knowledge, and such a way of shedding light on difficult subjects. I always learn from what you say - even more than from some of the other illustrious posters here. I would like to make a special request that you post more often, especially when some of the more difficult topics come up. I would love it if you would share some more of your wisdom with us.

Thanks to you and Markettalk for your help. My shiney is looking mighty finey!

Mr. Gresham, are you still lurking, too? How's my fellow Houstonian these days?


Black BladeU.S. International Reserve Position#1413002/3/06; 18:53:10

This is either good for a laugh or should have you grabbing precious metals with both hands:

The Treasury Department today released U.S. reserve assets data for the latest week. As indicated in this table, U.S. reserve assets totaled $65,622 million as of the end of that week, compared to $65,783 million as of the end of the prior week (see table at link).

Note the US gold stash - valued at $42.2222/oz.

- Black Blade

Black BladeThe Truth Is Revealed About Precious Metal Price Forecasts By Analysts in 2005 And Their Predictions For 2006#1413012/3/06; 19:02:25

The Truth Is Revealed About Precious Metal Price Forecasts By Analysts in 2005 And Their Predictions For 2006


Those who have watched gold prices for the last few years may be wondering what has happened to Andy Smyth of Mitsui Precious Metals who used to be very voluble with his opinions. Well, he was the second biggest bear of gold last year with a forecast of US$390/oz and was the biggest bear of silver at US$5.65/oz. In platinum he was also well below most of his peers and he only came close with palladium. This year he no longer features among the forecasters and is said to have left the precious metals industry for a new career in fund management

Black Blade: Not that gold mega-bear Andy took my advice, but over the years I had questioned why he took up a career in precious metals analysis when he so despised the metals. I was even chided once by Tim Wood as being "scathing" in my suggestion that Andy seek a career where he would be happier (still get a chuckle out of that). Anyway, looks like it should be an "interesting" year with much higher forecasts for the precious metals.

AllanC@Black Blade#1413022/3/06; 19:27:14

And a Negra Modello raised to you to, sir. (If I only had one in the fridge :-(

Apologies for not mentioning you in that elite grouping. You were telling us about peak oil long ago.
And in appreciation of those postings, I invested and made a few bucks along the way.

Thank you and I hope you never wander too far from us.

OvSBlack Blade.#1413032/3/06; 19:54:54

If the gold in the
US Reserve Assets
would be valued at
570 instead of 42
the total reserve
would be over 200
billion instead of
65 billion. Now, if
the price of gold
should reach 5,000
then we would be
talking of 1.5 plus
trillions. In the
larger scheme of
things still peanuts.


When President Bush Lies or is Accused of Lying-We Trash Him, Cut Him Down, Write Negative Editorials Regarding His Speeches, Policies,Etc, without any NEW ideas to get things resolved, militarily, domestically, economically, socially, etc. .
I Am Not Like Some Who Pray That We Should Not Receive What We Are Owed. If we are eventually going to reach those levels, WHY NOT NOW????? O, BUT WHITE IS BLACK AND BLACK IS WHITE.

MKBlack Blade#1413052/3/06; 21:02:12

I was among those who counted David as a friend. He is missed -- a warrior for the golden cause. I wish he could have seen this, and had the opportunity to take a few of his legendary swipes (at those who usually deserved it) along the way.
donnemuirChecking in#1413062/3/06; 21:04:46

Been lurking here since very near the beginning...thanks for the best education available; for winning 2 contests (one 1st one 2nd place)...and thanks to George for spending time with a real small time (but committed)gold buyer.
OvSHoosier#1413072/3/06; 21:13:46

Some people interpret
large caps as screaming.
We can hear you loud and
clear in small caps.

Chris PowellROB-TV cites Cheuvreux report as gold analyst predict 'an accident'#1413082/3/06; 22:04:21

Latest GATA dispatch.

To subscribe to GATA's dispatches, send an e-mail to:

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ChallyChecking in....Thank You MK and 'regulars'...#1413092/3/06; 22:08:07

Been lurking here every single day since 2/03, trying to take it all in. Still don't know if I've 'got it' yet, but I understand enough to know that I'm in the right place, and (now) so is a growing portion of my 'wealth'!

Thanks to all here who have been so dedicated in teaching those who would hear the message. I could go on, but it'd probably sound like a cheap commercial for our host and others....well OK, maybe tomorrow, but it's getting late for such a diatribe tonight ;-)

Chris PowellBarrick's settlement with Blanchard#1413102/3/06; 22:16:03

While the settlement of Blanchard & Co.'s lawsuit
against Barrick Gold has been sealed in U.S.
District Court in New Orleans, the evidence is
overwhelming that it consisted largely of
Barrick's pledge -- which Barrick has confirmed
in public -- that it would cease its gold hedging
operations for 10 years. The recent huge rally in
the gold price has coincided with two notable
events -- the settlement of Blanchad's lawsuit
and GATA's Gold Rush 21 conference in Dawson
City, Yukon.

Having stopped Barrick, the biggest gold hedger,
from any more hedging, Blanchard has made an
enormous contribution to the gold cause, a
contribution that already has been worth billions
to gold investors. This is far more than any of
us here have contributed to the cause.

The first questions to be asked of those who
complain that Blanchard's efforts against Barrick
were inadequate may be: How have YOU helped? What
did YOU contribute to Blanchard's work? Or did
you just go along for the ride at the expense of

PRITCHO@ OVS - - - New Calculator Needed#1413112/3/06; 23:37:42

If the gold in the
US Reserve Assets
would be valued at
570 instead of 42
the total reserve
would be over 200
billion instead of
65 billion.
A Recount should show that the reserve value would be over 880 Billion - -not over 200B - -

A big difference for sure.

Chris PowellNetherlands business TV network notes Cheuvreux report#1413122/4/06; 00:06:26

Latest GATA dispatch.

To subscribe to GATA's dispatches, send an e-mail to:

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The Invisible HandMoral dilemma#1413132/4/06; 02:27:49

GATA is happy with Cheuvreux.
In the Philippines, many people are living on less than two dollar a day.
The Philippine peso is linked to the dollar of the US of A.
What will happen to the Philippine people once the dollar is no more?

As Harry Hazlitt put it in his book "Economics in One Lesson" (1962):
The art of economics consists in looking not merely at the immediate but at the longer effects of any act or policy; it consists in tracing the consequences of that policy not merely for one group but for all groups.

Difficult to do when guv'mint has screwed the whole globe. Maybe it's worth to solve the problem once and for all. But, what do you do in the meantime with all those people whose very existence depends upon the greenback?

Is it the Asians versus the Africans?

TV network cancels anniversary celebration of noontime show
First posted 12:26pm (Manila time) Feb 04, 2006, Agence France-Presse
(UPDATE) ABS-CBN Network has cancelled the first anniversary celebration of its noontime show after over 70 people were killed and scores were injured in a stampede at the stadium where the program was to be held.
He said Saturday's show would mark the first anniversary of the program, and that the show was offering two top prizes of one million pesos each -- a fortune to the 40 percent of Filipinos who live on two dollars a day or less.

Ray 1Ethanol#1413142/4/06; 03:12:44

The anti-ethanol crowd is exposed
as fraud
(from Agriweek for 02/06/06)
In certain circles ethanol distilled from cereal crops looks like a serious contribution to the solution to several problems, including energy renewability and increasing non-export demand. In others it is a fraud that requires more energy to produce than it contains and is an economic hoax that is sustained at the request of the farm lobby by government subsidies. New research published in the respected journal Science on Jan. 27 seems like the last word in establishing that using ethanol is worthwhile on anti-pollution grounds and that producing it gives a net energy gain.

The study is by a group of professors at the University of California-Berkeley and the Goldman School of Public Policy. It analyzed six previous studies into ethanol's energy balance. Included were incompetent and biased but widely-quoted papers by Cornell University entomologist David Pimentel, contending that the energy needed to make ethanol exceeds the energy it contains, and that burning it creates more pollution than it avoids.

Pimentel included every cost he could think of, down to the energy needed to make the farm equipment that grows the corn that goes into ethanol. Amazingly, he did not assign any energy credit to the by-products of ethanol distillation, which are distiller's grains and carbon dioxide. The new study found that when these values are accounted for ethanol use displaces 95% of equivalent gasoline use and greenhouse gas emissions are reduced. Among previous work analyzed is U.S. Department of Energy research which estimated that a 10% ethanol blend reduces greenhouse gas emissions by 19%. The study noted that new technology to convert cellulosic material to ethanol holds even more potential.

Grain used to make ethanol does not disappear. A bushel of corn weighing 48 lbs. releases about 18 lbs. of ethanol, 7 lbs. of water and 1 lb. of carbon dioxide. The rest is distiller's grains which enter the same livestock feed stream as corn. This year the U.S. ethanol industry will use about 1.6 billion bushels (63 million tonnes) of corn but will return about 24 million tonnes into the livestock feed supply in the form of distiller's grains.

Many ethanol plants simply release the carbon dioxide from the fermentation process into the atmosphere, but increasingly it is being recovered for commercial purposes. Carbon dioxide prices are falling because of fast-rising ethanol production, making possible new uses which were previously too expensive. One is to inject the gas under high pressure into old oilfields, reviving or greatly increasing their crude oil output. (E-mail users click here for a summary of the Science article).

Ethanol figured in the state-of-the-union address last week by U.S. president Bush, who said that an American goal should be to reduce oil imports from the Middle East by 75% in the next 20 years. Ethanol will help but can't fill the gap. Current ethanol production using over 15% of the U.S. corn crop equals 2 to 3% of U.S. gasoline use. If all corn currently exported were diverted to ethanol that tiny percentage would barely double. There is far more potential in using crop and other cellulose residue that at present has no commercial value. Even so, nobody says ethanol is a substitute for oil: it's an infinitely-renewable supplement.
- later in this decade, over 20% of US corn crop will go for ethanol production. The carryover in US corn stocks and subsequent exports will end
- all foods (cereals, meats) derived from corn will face substantial price increases (grains are only commodity that has not taken part in recent boom)
- higher food prices will make it hard to mask inflation --------> higher gold prices.

Best regards
to All


Does purchases of physical gold from 1978-this week 2006 in the high six figure range, from various retailers including CENTENNIAL PRECIOUS METALS and BLANCHARD & COMPANY constitute a valuable contribution to the GOLD fight or not??????????????????????????????????????????? I mean, I took it off the table from the GOLD MANIPULATORS, for worthless paper, and they can't get it back!!! Even if they (BLANCHARD & COMPANY) would not have received any monetary damages, but just would have made good on their claim to force BARRICK to COVER ALL THEIR SHORTS/HEDGED POSITIONS THAT THEY HAD, AND WHICH THEIR ACCOUNT EXECUTIVES WERE TELLING THEIR CLIENTS, INCLUDING MYSELF, THEY WERE SEEKING TO ACCOMPLISH ULTIMATLY, I could have lived with that settlement. That would have boosted the price to reasonable levels, based on 1970 dollars. REMEMBER, THEY HAD ALL THE EVIDENCE. BUT A WORTHLESS PROMISE/PUBLIC STATEMENT????? Furthermore,if I cannot believe the President of the United States, why would I believe a GOLD CARTEL entity who announces their intent in further/future trading/hedging business activity when they have been engaged in illegal activities all these past years and verified by GATA and now a BIG FRENCH BANK ??????????????????? DO PEOPLE REALLY BELIEVE THINGS LIKE THAT IN TODAY'S WORLD?????
GoldiloxNovember 2005 Import Highlights: Released on January 23, 2006#1413162/4/06; 05:29:33


Total crude oil imports averaged 10.265 million barrels per day in November, which is an increase of 0.885 million barrels per day from October. The top five exporting countries accounted for 67 percent of United States crude oil imports in November and the top ten sources accounted for approximately 87 percent of all U.S. crude oil imports.

Crude Oil Imports (Top 15 Countries)
(Thousand Barrels per Day)
CountryNov-05Oct-05YTD 2005Nov-04Jan - Nov 2004
SAUDI ARABIA1,2671,1801,4381,6311,499
UNITED KINGDOM229219237156232


By rough estimate, ME sources are about 19% of total crude imports, with Saudi Arabia totaling about 12%. Iraq is now about 5%, and Iran is not even on the list. Venezuela, Dubya's more local political pain in the side, also contributes around 10%. There is also a chart of total petrolem imports on the page, which I assume also includes refined procucts.

GoldiloxMore on oil imports#1413172/4/06; 05:39:17

This is just one data point, but looking at the chart for November, Saudi Arabia and Venezuela are both coming in lower than previous averages, while the others are rising to make up the difference. Is our "oil addiction" problem already revealing itself in reduced import levels from two major suppliers?

Simmons says the Saudi fields are in decline, and we know that Chavez is increasing his customer base by signing delivery contracts with China and India.

HOOSIER GOLDBUGLAST POST!#1413182/4/06; 05:43:03

Sir Randy, Site Master:
Please pull my registration and posting priveleges as I will not be needing them anymore! It might relieve some of the clutter on your server and make managing this site a little easier. As of today February 4, 2006, I have joined the elite group of individuals (ANOTHER, FRIEND OF ANOTHER, BELGIUM, ARISTOTLE, and far too many to name) who no longer post here because they have read/know the writing on the wall, far greater than I even understand that NOTHING IS GOING TO CHANGE AND IN THE END THE GOLD CARTEL IS GOING TO WIN IT ALL. WHATEVER I THINK HAS BECOME TOTALLY IRRELEVANT AS I DO NOT KNOW HOW TO ENGAGE THE WAR ON A DIFFERENT FRONT WITH A CALCULATION OF A DIFFERENT/SUCCESSFUL OUTCOME THAN PREVIOUS ENGAGEMENTS WITH THE ENEMY. If the GOLD CARTEL can win in the face of the all the incriminating evidence against it in a FEDERAL COURT and proven by GATA and now a LARGE FRENCH BANK, they can beat any kind or form of opposition it comes up against, even the physical market. They will just take it all away from the GOLDBUGS, as the ongoing possible confiscation argument expouses.

GoldiloxGold, platinum surge to highs#1413192/4/06; 05:47:00

The spot price of gold as well as the prices of platinum group metals, platinum, palladium and rhodium, traded to long-term or all-time highs on fund buying and bullish sentiment towards precious metals, traders and analysts said.

At 5pm, gold was quoted at $572.75/oz, up $3.40/oz from the previous close. In January 1981 gold fixed at $602.25/oz.

"The momentum higher in gold continues. The consensus in the market is that gold will trade to between $600/oz and $800/oz in 2006. The asset relocation into gold continues," said Switzerland-based MKS Finance's Frederic Panizzutti.

There were two key factors driving gold, which was its insurance value against uncertain and unexpected events as well as an increasing role as an investment asset, he added.

For the foreseeable future gold could target $580/oz, followed by $600/oz, with support at $550/oz, Panizzutti said.

"The precious metals complex continues to trade in recent high ranges with positive sentiment in the complex intact, with inflationary concerns stoked by high oil prices providing support to the complex.

Iran in the spotlight

"The current geopolitical situation also remains tense, another factor supporting gold prices, with the International Atomic Energy Agency (IAEA) holding an emergency meeting today over reporting Iran to the United Nations Security Council," London-based Barclays Capital analysts wrote.

"The firm start in the US might be the catalyst needed for a test of $575/oz, particularly with the IAEA due to reach its verdict on Iran which could mean sanctions and would not only heighten tension in the Middle East, but could create inflation concerns if oil output was curbed," UK-based analyst James Moore wrote.

"We believe the strength of the physical market is vitally important for 2006; even though gold is rising on speculative and investment buying, at some point there will be a reversal of this trend and gold will correct," London-based UBS analyst John Reade wrote.

"The level at which physical demand emerges to support the metal will then form a base for gold to make fresh gains," Reade added.

GoldiloxGold Cartel#1413202/4/06; 05:50:40

@ Hoosier Goldbug,

Though I tend to agree with your assertions, I fail to see how running and hiding from the status quo benefits anyone. Do you really think TPTB will target your stash any less if you decide to just "play dumb" to their manipulations?

GoldiloxTaking Russian cash and high-tailing out of gold#1413212/4/06; 05:59:09


LONDON ( -- A couple of weeks ago we wrote about ZAO Polyus and mentioned its relationship with Celtic Resources. The Vice President of Polyus commented in his meeting with the Association of Mining Analysts that Celtic and Polyus, which were at that point in a joint venture with respect to the Nezhdaninskoye gold mine in Yakutia, Russia, were agreed that the top priority was to bring the project on stream, that "all other issues" were subject to negotiation and that he believed the two companies would find common ground. These issues, as outlined below, related to just who owned how much of what.

Celtic now says that it has agreed to sell 20% of the South Verkhoyansk Mining Company ("SVMC"), which is the holder of the license for Nezhdaninskoye, for US$80 million cash. The purchaser is the Interros group, which is one of Russia's largest private investment companies and a controlling shareholder in Polyus (and Norilsk Nickel). KM Technologies (Overseas) ltd., which is an investment vehicle for the Interros Group has made the cash offer, which is conditional on Celtic withdrawing all legal actions concerning the disputed ownership in SVMC and thus in Nezhdaninskoye.

Over and above the cash payment, Celtic expects to receive the repayment of the principal component of the debts owed by SVMC to Celtic, which total approximately US$10 million. The US$80 million will be held in escrow conditional upon the withdrawal of all Celtic's legal actions pertaining to the Nezhdaninskoye ownership, which is expected to occur by March 31st this year.


It seems the battles over who "owns" gold-in-the-ground are coming to head in both Russia and Latin America. Perhaps not unlike the battles in Russia and the ME over who "owns" oil-in-the-ground. It seems the foreign powers have a little different take on Dubya's "ownership society."

Ned@ GoldenDome#1413222/4/06; 06:02:42

Thanks for the excellent review of Don's call this week, beautiful summary.

Sherry Cooper was Don's guest. Just as a point of interest, this woman is an ultra-conservative, notice how she squashed the idea of some hidden agenda in the non-reporting of M-3 in March. (I actually had a little laugh at that.) Anyway I was more than a little shocked at her call of $600 this year and $800 within 2 years. That's quite a statement out of her, believe me.

Anyway, the theme this week seemed to be the "de-coupling" of gold (at least in the US) with the notion of inflation and it is a must 'hear'.

I also watched the segment from John Ing as referenced by Chris Powell. Also very good, Mr. Ing talks about the eventual breaking of the "old $850 mark" and a (derivative) "accident" this year, possibly breaking the $850.

Thanks for mentioning Don's call, have a golden weekend.

GoldiloxPensions, Dividends, and Royalties#1413232/4/06; 06:18:41

While we watch resource-rich nations defrock multinationals of their ownership (royalty) tights, it is interesting to watch the corporations respond. They continue to move revenue centers offshore to avoid US taxes and rapidly reduce dividends and pension obligations to squeeze the American treasury, worker, and investors to make up the difference.

More interesting will be whether the corprorate oligarchs, losing ground in Russia and Latin America, will continue their domination of US politics, or also lose ground to growing western populist movements. Another "New Orleans - FEMA debacle" might elicit "martial powers," but it also might be the straw that breaks the camel's back for the current anti-populist western leadership.

GondolinChecking in, not out#1413242/4/06; 07:07:35

Been a daily (sometimes for hours at the expense of what I was being paid to do lurker and very occasional contributor since 2001. Believe I am now safely set for life. :) Thanks to all the posters, most still current, some missed, for the eduation and insight.

Most of us I believe do our best to share our 'forbidden knowledge' with others. As with most of the great games in the history of this world, the powers that be, those with the muscle to flex, the means to do it,have had history written how they wanted it, had education directed where they want it, managed and exploited the masses where they want them, ala the divide between rich and poor in the Islamic world, ala the new testament and the holy roman religions' repression of the gnostic teachings, ala TPTB, Gold Cartel, Demopublicans, Tony Bush and co.

Its not a war that can ever be won. Its eternal'some would say like the battle between God and Satan, Good and evil, truth and lies. Lets face it, everything is shades of gray.Depends how you look at it, whether there are storm clouds or blue skies, or how much light you can shine on it. Thats where this forum stands out as wheat amongst the chaff, or maybe one could say as gold amongst paper.

Rantings and resentment that gold has not exploded to the heavens in light of the recent developments today I find amusing. What use would all of us being rich beyond dreams be if everyone else is in abject poverty and misery. I trust more have the opportunity to be enlightened and jump aboard the gold bull express before it peaks.

I trust TPTB will manage this process slowly to where the value of gold against fiat should be. In these people we must (unfortuneatelty) trust, though oft times they show this is undeserved. Forums for discussion such as this are rare and valuable, and provoke slowly the questions that will become mainstream slowly as they filter throufgh the media and the masses. What was discussed only here years ago is now mainstream. This is true power.

Keep up the good work.

Thanks to all, (and especially to USAGOLD for my shiny 1/10 eagle, yes, another happy guesser!!)

MKCheck-In Day to continue through weekend. Table Round veterans, lurkers and newbies: Are you out there?#1413262/4/06; 08:29:35

"Check-in Day" has been a humbling event for us here at the Castle on two levels. First, it is terrific to hear from so many and know you are still with us. For every individual who posted there are probably at least 100 who read the forum but don't post. Second, the compliments directed toward me, this forum and the gold firm behind it were unexpected. It wasn't my intention to fish for a compliment, but the many kind words are an inspiration. Many thanks to those who extended their best wishes. . . .Please keep in mind, it is all of you who make this forum what it is. People come here to gauge what the public is thinking on a number of gold related issues and they want to hear it from you.

As for "Check-in Day" itself, let's go with it over the weekend so that those who only have time to come here on Saturday or Sunday can let every one know they're here with the rest of us and maybe say a few words about gold.

Thanks again.


Thursday's post:

Every once in a while, we have a "Check-in Day," wherein all the Table Round veterans post a note to tell us they are still around, and lurkers and newbies can simply say they're here watching and reading. It's good for those who take the time to post their thoughts and opinions here to know that there are people reading. It's important for all of us to know that there are others of like mind out there who appreciate this venue.

I thought today might be a good day for that. We haven't done it in awhile. You might add how you feel about the gold market at present for the general readership, but its not mandatory.

So, we invite you to say hello and extend our thanks in advance. . . .

WhitewaterwomanIf you're giving up...#1413272/4/06; 09:01:45

...Hoosier Goldbug, can I have your gold??? :)

Never quit trying !!!!!

MKThe Gold War in Germany#1413282/4/06; 09:16:14

An article published in yesterday's Financial Times underscores the complexities of the gold market, and points up that there are really only two divisions amongst the world's movers and shakers when it comes to gold -- those who believe in it and those who don't.

That article, which appeared under the headline "Berlin and Bundesbank at odds over gold sales," tells the story of the German Finance Ministry's desire to liquidate part of Germany's gold hoard and the Bundesbank's desire to hold on to it. Too often when we analyze events from a gold perspective the tendency is to color countries with a broad brush and say for example: France is pro-gold; Netherlands and United Kingdom are anti-gold, etc.
When we make generalities like that, we remove from the table two important considerations:

1. There are elements within any country that are either pro- or anti-gold

2. The policy of a nation or central bank can change unexpectedly when the political winds blow

The situation in Germany is a case in point. We can all remember the contest we had here at the Forum (January 11, 2004) when we poked fun at then Bundesbank president Ernst Weltkeke penchant for concocting one reason after another to sell the German gold. ("Hi ! My name is Ernst Welteke and I think that Germany should sell its Gold because. . .") Well, for those who believed that EW was a lonesome hawk when it came to gold sales, and we were among a minority of lonesome doves, it now comes to light that those in Germany who push for gold sales didn't go their merry way along with the former Bundesbank president.

To the contrary, they've resurfaced and coalesced in the present Merckel Finance Ministry. The Finance Ministry states that the motivation for selling German gold is a trust fund, the interest from which would be used to finance "research and education." One wonders why the Finance Ministry wouldn't recommend a bond float -- a methodology that would get them to the same place without giving up the hottest performing asset on the planet. But as most of us by now, at least those of us who visit these pages, there's always something a bit more dynamic to the gold sales mantra than something as mundane as financing "research and education."

In my view, gold sales have everything to do with returning bullion bank gold deposits to those demanding their metal back (other central banks, large private investors, etc.) and little to do with the purposes the politicians publicly avow.

Bundesbank president Axel Weber has drawn a line in the sand on German gold sales. A representative from Bundesbank, the above-mentioned article states, reiterated that the Finance Ministry measure "cannot be allowed to interefere with the Bundesbank's management of currency reserves." "[Bundesbank] has also threatened to bring the issue before the European Central Bank, whose statutes prohibit government interference in the management of central bank currency reserves. The article ends with this: "The move, bank officials said, would only reinforce the bank's determination to stick to its guns."

The fact that Bundesbank is digging in its heels on the gold issue has become a major element in gold's recent rise. Following the Bank of England and Swiss National Bank cave-ins, it represents the turning tide in the way major central banks view their gold reserves, and sends a message to those short gold that they can no longer depend on categorical support from the central banks. Short covering could very well be the real reason for the quick recoveries in gold in recent weeks whenever it has dropped. It could also be the reason for JP Morgan's and Credit Agricola super bullish forecasts over the past week.


A link to this important article is appended.

Jing ZuCheck in Day#1413292/4/06; 09:17:13

Hello Friends,

Well, daily I check USA Gold and I have made many purchases throughout the last 4 years. It is nice to have this site available to so many. I have read and learned from the many regulars. I do not post that often because I am not near as up to date as most of you. I have won a couple of times when we have the guessing contest. That is always nice.

The gold rush that has been going on these past few months is a welcome site. I remember the beginning of "05" that the predictions were around $500/ounce and these were so close to the mark. This years conservative estimate is around $800/ounce. I am sure that we will see these figures and more. These days are unstable in the world and we better heed to what has happened in history throughout the ages. Get GOLD!

Silver appears as if it will increase a little more than Gold will this year. I have been thinking of buying this precious metal, but the larger amounts (size) are harder to hide.....

Thank you Michael and Jonathan for your site.

Take care and may God have some bearing on your lives..

Jing Zu (Gold)

Cavan ManMK's Unintended Corollary IMHO#1413302/4/06; 09:55:42

Physical gold is for having and holding and everybody should have some. Gold equities are for trading.
ShermagPritcho, On calculators and US reserve revaluation of gold#1413312/4/06; 09:58:50

Ovs' and my calculator both concur on the over $200 billion reserve value if gold is revalued at $570. It is $203.6 billion to be specific.
HenriBlack Blade#1413322/4/06; 10:37:47

Perhaps we have Farfel (DC) to thank for the rise in POG.
Certainly we have all tried to do our part from this side...perhaps he was able to do more from the other side.

Checking In MK

GoldendomeNed: Continued thanks for first bringing this site to our attention.#1413332/4/06; 11:00:35

We have found Don's weekly call to consistently be an insightful look at the markets. Often times, from a little different angle than what is being more commonly observed. I think we are fortunate to be able to listen in to his "call" to the well healed clients. (I only wish that they would keep previous weeks "calls" up on the website, also. Often, I would enjoy going back to listen to some previous week's material. I generally try to listen to each show more than once, as it is.)

Another point made in this weeks call that I think that we should mention and haven't to this point, was a topic brought up about 20 minutes into the call. Don made the point that indications in stock market activity show that money is moving out of stocks and industries that compete with China and Asian producers, and into stocks of companies that supply and sell to Asian and Chinese producers.

Don continued: There was a theory, that based on the action of the futures markets in oil and the metals, where there has been a change from a situation of deep "backwardation" [spot month higher than outlying months] to now, where the futures curves are flatter with the out months right up there with the spot month-- Is this a sign that China is using it's vast supply of dollars to buy the commodities currently needed, and also, to buy the futures on those commodities for future delivery when needed? And in the future then, to use those dollars to eventually take the commodities off of the futures market?

If you put it together then, since they will take delivery of the commodities in the future [or not] this is a way to use their accumulated dollars to lock in future supplies-- and their only risk, is the credit risk of the United States Treasuries.

So, what they can do, is not to change the apparent nature of their foreign reserves --because they still hold most of the dollars in treasuries and various asset backed agency securities. But what they have now, is a call on many of the commodities that they will need in the future to keep their industrialization moving ahead.

Don, summarizes by saying, that if this is true, its a fascinating change in thinking and behavior and further helps to show why things just may be different now -- and those who feel that nothing has changed in the economic cycles, power, and markets -- will continue to be surprised this time around.

GoldiloxGeorge "Zapata" Blake#1413342/4/06; 11:12:23

For those who enjoyed, or may have missed Jim Puplava's interview with George "Zapata" Blake over the holidays, he is back today on FSN.
USAGOLD / Centennial Precious Metals, Inc.A world of gold at your fingertips...#1413352/4/06; 11:25:44">gold -- a global calling card
Flatliner@Goldendome #141334#1413362/4/06; 11:49:18

When I listened to this phone call yesterday, I also took note of the futures comment that you mention below. Before joining this forum, I would have thought nothing about it. But, if it's true ‘that all paper gold will burn’, it might stand that all ‘paper commodities’ will burn and the actions that are going on in the futures market are worth investigating to see if there is smoke.

To state the obvious, for every commodity trade in the futures market, there is a buyer and seller. To go with this, there have been postings galore here as to where the shorts are coming from. The real question is who are the longs? And what is their motive for not taking delivery? Could it be that Don gives us a clue as to the longs and their motive?

When I listened, I immediately thought that if China really believes that there is a direct link between futures contracts and physical delivery then when they actually call in the supply, the western system will renege – just like what Nixon did years ago with gold and the US dollar.

Its very interesting. Could it be that we will see a *nearly exact* repeat of what happened to the dollar convertibility to gold from foreigners? But, this time, it will be futures convertibility?

Every delivery month for gold, we watch as the longs roll over. Those who have claim, are not taking delivery. Will they? Is there need? Or, could it be, that there is political motivation to roll over? With Gold, there is huge political motivation to roll over, but what about everything else?

For those waiting for an event, watch closely the futures delivery process for if the longs make a claim, the ‘treasury’ (the futures system) will baulk in front of the entire world. That, IMHO, will be the point at which the physical market separates completely from the derivatives market.

Goldendome@Goldilox -- General observatin of late on the FSN broadcast.#1413372/4/06; 12:01:33

Goldi: I haven't listened to the Zapata portion yet, this time, but will shortly. From last appearance he was a rather colorful character.

In a broader sense, as long time listeners of the FSN broadcast, how do the shifts in outlook strike you? Specifically, since Barbera has joined the show, he and Jim are sounding like playback recordings of each other. Both (har,har, har) called a GOLD top in late December, you recall, with the price barely over $500. Since then, both IMO, have almost seem apologetically wishing that it would occur, so they could have been right. At the time, they both indicated that they had liquidated large portions of their holdings and would be looking to buy back at somewhere around $470. [Now who knows for sure, maybe they still will at some point. But, any who sold at that point have missed $60 or so on the move.]

I think I mentioned it here a month ago, that the impression that I was getting (and still am, do to their recent pumping of, get this-- the technology sector) is that to an extent, these guys are turning into shills, front running the opinions they espouse on the program.

Sorry to say, that I find myself fast forwarding through many segments of the show now.
The analyst from Alabama--haven't listened there for weeks. That guys a conundrum wrapped in an enigma, weekly. He's going to be in "non-confirmation" till he dies.
Barbera? What a waste of time.
The weekly guest from Chicago is good, because he actually has a separate thought process.
The oil analyst from Dallas is usually good, and at times, has some good observations.
Dave Morgan? Ok, but has a tendency not to want to disagree with Jim, even when he should.
The guy that I really miss not being on the show is Jim Willy. He wasn't on there too long on a regular basis, as I think Jim quickly realized, that this guy was a hellofalot smarter than he!
The 3rd hour wrap-up segment? Unless they have a guest or two, why bother? Usually, its just a Jim diatribe, repeating for the third time what he's already said twice before somewhere in the program. With pre-arranged questions being floated out by his co-host (who I do enjoy because of his humor and understated knowledge.)

Goldi: That's my rant on the FSN broadcast. I've been keeping it to myself now for a few months as I have been displeased with it's (at least to me) change in tenor (good to get things out in the open sometimes). Am I overly critical here?

GoldendomeFlatliner, Supply shortage on Gold futures deliveries#1413382/4/06; 12:59:30

Flatliner: You bring up the $64,000 questions, or whatever delivery of a gold (silver too for that matter, maybe too- copper, eventually) is worth.

I think that we have discussed here several times in the past, the scenario that you present.

Many have felt that it will eventually happen [that more metal is called away from the futures storage than can be delivered] and at that point, I believe, consensus had it, that it would bring an end to some of those markets. What would be the point of having them, if you really couldn't use them to hedge your delivery price in the future, if needed or desired???

We can't know for sure what will happen--what type of game--new or old-- the governments might try to play or dream up to best protect some vested interests.

We will keep an eye on the metals-precious and otherwise (all are becoming more precious). Should the dollar breakdown precipitously, or the bonds, or some event bring about a gold spike---Or heck, why not all three at once! ...I think that if I had some of those contracts and an overabundance of $'s residing in treasuries, I'd take some deliveries, too!

A point: I think we are seeing run-ups in all the commodities. Are the same parties moving the farm product futures as the metals and oils? Could be. But the thing about the farm products-- shortages are usually from one year to the next. Production can quickly be ramped up all over the world to meet those prices, if there's money in it. The same is not at all true of the metals. Once we have a shortage in the price and it persists...exploration and development fall off...production falls off... and maintenance and upkeep on facilities existing falls away. This is where we are now after twenty years of metals depression. It will take a while to get production up to meet new demand.

Personally, I think that those invested in Gold and Silver futures, if they have large holdings of U.S. $, as the Asians do, will be wise to take delivery on a least a portion of those contracts. A stealth accumulation program now appears to be underway...and that's the way anyone would want to do it if they want more in the near future. You wouldn't want to spook the market higher yourself-- at least, not until you were ready to do so!

Some here have pooh-poohed the metal ETF's, but they are thus far, proving to be a "hole" so to speak, where a lot of the available precious floating around is being buried. This is making apparent, perhaps, physical shortages and driving prices still higher. The fact that large pension and mutual funds able to invest only in shares are now buying these shares in ETF's is driving the demand for more of these metals to be accumulated by the ETF storage "holes".

Some worry, "well what happens if the ETF's decide to sell?" Why worry about it! If they sell, they sell. There's nothing new about big holders selling some of their holdings from time to time. But as long as people around the world are worried about paper currencies, debt, inflation, deflation, oil, hurricanes, pensions, health care, Medicare, SSI, the price of tea in China, killer bees, fire ants, yada-yada ---- Who the heck wants to sell?????

Flatliner: Look for more metal to be taken off the futures markets. One will lead to the others. Look for metals to all move higher, as Asians by the millions move from mud, stick, wood, cardboard box hovels, into houses that need copper wiring, metal plumbing and pipes, concrete ----they will throw down their bicycles for cars made of metal, powered by gasoline, that run on streets made of asphalt, etc. At least some of the wealth now being held as dollars, will also be traded for Gold and Silver as a non-inflatable, by quantity, store of wealth and protector of future purchasing power.

Best, G-dome

Humble Piegold #1413392/4/06; 13:06:35

Spend the paper ,Keep the metal
tejbearMy view...#1413402/4/06; 13:17:16

This is how I see it..

The following is my understanding for the devaluation of the dollar. The dollar's long standing as a world trade unit is coming to an end. A world trade unit, as described in Murray N. Rothbard's book titled "WHAT HAS GOVERNMENT DONE TO OUR MONEY" goes through ascendancy and a decline. The decline is composed of both a de-industrialization and the loading of foreign debt. Reads of the forum are all too aware of the US's decline in blue & white-collar jobs, the trade deficit and the amount of foreign debt being borrowed by the government and citizens.

The world trade unit comes to an end when the creditors believe that the debtor has become a bad credit risk, i.e. England in the fifties. At that time, the British Pound was dropped, and was eventually replaced by the US dollar. The value of the British Pound dropped around 50%, resulting in an increase of the cost of living in England by 50%.

So, for all of the Greenspan bashing, Greenspan was dealt a "losing" hand, as the dollar will eventually collapse, like the British Pound, regardless of who is running the Federal Reserve.

The normal cycle of a world trade unit was altered when in the 70's, when the US basically defaulted on paying its debt to foreign countries with gold, and was able to use its IMPERIAL WORLD POSITION and get the world to use fiat currencies.

GOLD & SILVER became obsolete.

Shift forward thirty years and the degree of de-industrialization / job exportation in the US is reaching "critical mass". What else is left to export? Event the historical titans of US business GM and Ford are slowly entering the abyss, (bankruptcy in 2 or 3 years?). The US Current Account Deficit is growing exponentially, saving in the US are non-existent, while the vast majority of Americans are blissfully unaware of our dire predicament thanks to the government's SPIN MACHINE.

The US's losing hand is about to be exacerbated by the convergence of other "nasty" factors that will multiply the intensify of the collapse. These factors include: the retirement of the baby boomers (resulting in a considerable drop in consumer spending in the US), an increasing number of destructive storms caused by increases in global warming, alienation of allies because of the fraudulent war with Iraq (and if the Dubya has his way, with Iran) resulting in an in hostile attitude with foreign "creditors", unfunded liabilities of the US government now totaling over $40 trillion and last, maybe most significantly, the end of limitless cheap oil (peak production in ~ 2000 will contribute to growing shortages, impacting the US harder than any other importing country).

I am afraid that the world will be going through a rough patch in the near future, unlike any in our recent past. Given the extremely poor leadership that has usurp power in the US, it is dubious any good decision-making will be used to minimize the depth of our decline.

Since the dollar will eventually collapse, safety can only be found in gold and silver. I suggest collecting something with numismatic value as this type of bullion wasn't confiscated by FDR in the 30's.

Good luck to all.
The Bear

GoldendomeBack home in Indiana#1413412/4/06; 14:12:56

T-Bear: Yes, I woulda, shouda, couda, poured a few more $20 "Saints" into the storage chest!

Hey, all, what got to Hoosier? Sorry, but I missed any big conflict that erupted between him and anyone else here.

But reading back a ways, It looks like something had gotten to him. He'd been galloping around here like a mad bronc, that just had a saddle thrown on it's back for the first time, and finally-- just jumped right over the fence and has galloped away kicking and snorting.

Something in that Blanchard settlement really seemed to have burned his fuse! Now like most, I try to steer clear of legal issues if possible...But the one thing that I have learned in my few legal encounters over the years is this: That no matter who is right, the whole point of the process is about extracting the maximum amount of money possible from each side--endlessly if possible; a legal case, particularily if it goes to court, is like a lawyers annuity--you can pay month after month, year after year.

I don't know much about the case, didn't care to, didn't want to. But there comes a point where the monetary extraction, dribble, and general business distraction may become greater than the benefit of "winning". Sometimes, I think, "point made" in a draw, is probably a helpful compromise for the future, rather than banking all on "winning" at all cost, or risking all points made (possibly) by "losing" in a legal battle. Often times, a legal battle comes down to finding middle ground to settle on...and if your point is made, if it gets your opponents attention, if it makes the other side aware that you're watching, things are recorded and brought out into the light...then often times, that was the point of the argument afterall.

Even though the case "Blanchard vs. Banks" was settled without a clear victor, there is a point to be made, that perhaps we've all benefitted by the exercise, if indeed; it has changed behavior of the manipulators.

NomadEthanol Math#1413422/4/06; 15:47:37 "I haven't seriously considered ethanol as a liquid fuels substitute lately, but today I was perusing some 'green' websites and became curious about the cost of the process. It turns out that the total USA corn production in a year is about 9 Billion bushels. Each bushel weighs roughly 56 pounds. More rough math indicates that it takes about half of a bushel of corn (26 pounds) to produce a gallon of ethanol. Current corn prices in the USA are a little over $2 a bushel, rather low historically, and govt subsidies run roughly $4 Billion per year (adding roughly 50 cents to the 'imaginary' corn price).

So here is the interesting part - what if we took EVERY bushel of corn grown in the USA and used it for producing ethanol. Well that means 9 billion bushels of corn become some 18 Billion gallons of ethanol (ignoring the energy cost of transforming corn into ethanol) per year which divided by 42 gallons per barrel = some 430 million barrels of gas equivalent. But ethanol has about 2/3 the energy equivalent of gasoline so now we are down to about 286 million barrels equivalent.

This is 14 DAYS of USA oil use (at 20 million barrels per day).

And ethanol is going to save the day how, exactly, again ???"

wileyGold Scrap Recovery#1413442/4/06; 16:55:52


Thanks alot for the links , I'm checking them out and what I see so far is very interesting. I don't like working w/cyanide and this gives me an alternative.

You can find gold in the damdest places. If there are any more scrap miners out there let me know how you get small quantities refined. Thanks all.

goldquestCheckin' In! (better late than never.)#1413452/4/06; 17:27:21

Good to see BB, Rich and a all of the other old and new timers checking in!
Has anyone "seen" Uponroof?

Cavan ManGraduating from USA-GOLD#1413462/4/06; 18:54:07

(no worries about official sector gold sales)
Awesome; for a guy struggling with a mid-life crisis I am at complete (secular) peace. I have earned it right here at All this talk about checking in and checking out has me in a bit of a philosophic mood. However, I will be brief.

The bogeyman of potential official sector gold sales has been vanquished; he is a shadow in the breeze of current events. So much metal has already been mobilized; only forestalling the day of reckoning evolving with the THOUGHTS here. It is because of practical purposes that none remains to be "mobilized".

For now and the forseeable future, the sheer weight of $USD indebtedness prevents further offical sector sales. In fact and reason, the sick man of global monetary policy and infrastructure encourages official sector accumulation rather than distribution.

Until the Euro attains a predominant share of global settlement for vital commodities, do not expect the Euro zone to sell gold in excess of their WAII. Upon acceptance of the Euro (and/or Asian currencies)as a reserve currency(ies) par excellence, official sector sales will indeed resume. On that day and in the runup to same, the gold price will be MUCG HIGHER.

I have been a consistent buyer since 1999 here. I am a buyer still. I am hoping for orderly markets. If the TSHTF and it becomes TEOTWAWKI, neither gold nor dross will save thine arse. In the interim, I strive for holiness.

I'd like to thank Mike Kosares and everyone who has made this site possible over the years. I could not have achieved the knowledge and wisdom wrought here in public discussion anywhere in a formal educational dynamic.

All the best and cheers....CM

Liberty HeadDon't Worry About Peak Oil,#1413472/4/06; 20:11:24

Worry about gov't, suported by millions of angry idiots.
In a free market, peak oil would remedy itself with a minimum amount of pain. However, the truth is, we will never experience the free market solution. We will instead have the fascist gov't controlled "fair market" solution. Which is to say, there will be no solution at all. Since higher prices will not be allowed, we will rather have no oil for production and transport of essential needs.
Now would be a good time to store away some of those essential needs. Store away enough to share and trade.

Best Wishes

PRITCHO@Shermag - - Re TWO Faulty Calculations :)#1413482/4/06; 21:57:45

Shermag (2/4/06; 09:58:50MT - msg#: 141331)
Pritcho, On calculators and US reserve revaluation of gold
Ovs' and my calculator both concur on the over $200 billion reserve value if gold is revalued at $570. It is $203.6 billion to be specific
I have checked again & maintain that my original post (141311) is correct.A "simple" calculation was made based on the information posted originally by OVS.This was:

"If the gold in the US Reserve Assets would be valued at
570 instead of 42 the total reserve would be over 200
billion instead of 65 billion.
If the reserves at$42 oz are worth 65 Billion, then valued at$570 (13.57 times more) the reserves are 13.57 X 65 which equals reserves worth $882.05 Billion.

Please inform me wher I have made an error? - - anyone?

OvSPritcho.#1413492/4/06; 23:02:00

My calculation, confirmed by
Shermag, was as follows:

The link to the
posted by Black Blade in
his msg # 141300 states:
that total reserve assets
were 65.6 billion dollars
less 11.0 billion gold
equ. 54.6 bil.currency res.

11 bil $'s divides by 42
gives you 262 mil.oz of gold.
262 times 570 = 149 bil.$
Now add 54.6 billion of
currency assets and you get
203.6 billion dollars total.

NoEyeSee(+_+)Ethanol Math........ forget it!!#1413502/4/06; 23:24:12

If you consider the amount of oil used in growing the crops, harvest, transport and the amount of energy to remove excess amount of water from the have a negative return of energy!!

You input more petroleum than the energy equivalent of ethanol you will get!

Liberty HeadNoEyeSee#1413512/5/06; 00:07:25

You are being logical.
Unfortunatly, when looking at the actions of gov't, logic does not apply.
Once you understand gov't is just a bunch of neanderthals in expensive clothes with flag pins on, then you will have learned the lesson.

Best Wishes

contrarian Tejbear (2/4/06; 13:17:16MT - msg#: 141340)#1413522/5/06; 02:23:32

Think you have a brilliant sumup of the situation. Would be curious to hear more about the circumstances under which the British pound lost its status...the deindustrialization started to occur before WWII, I imagine, with the rise of mass manufacturing in the US in the 1920's (Henry Ford, etc.)? And then the US victory, end of WWII, put the bloom on the rose, replacing the pound with the dollar, making what had already been unofficially acknowledged a fait accompli? It would be interesting to hear more about the deindustrialization of England.

I think a 50% drop in dollar value sounds about right, as that is a, shall we say, round figure. Could be worse, but that's a safe minimum estimate. Look at what happens to people whose pensions end up under PBGC--50% on the dollar.

As for confiscation, I can only imagine it will happen again, albeit under different circumstances and under different cover.

Also think that a lot of people are in denial about global warming and peak oil. This is typical of paradigm shifts such as the adoption of new scientific theories. They are never quickly embraced. Contrary to the ideal of the scientific method, the scientific establishment is always resistant to the new theory, as it has a lot to lose in the demise of the old way, many careers, papers, reputations being at stake. Look at the difficulties of Copernicus, Galileo (earth around the sun), Pasteur (germ theory), Darwin (evolution), and how the establishment resisted until its dying breath, and that's sometimes what it takes!

In short, althought history may not exactly repeat, it will certainly rhyme, as says Mark Twain in his well-known adage.

As an abstract, here is something about Thomas Kuhn that explains the his thoughts on the evolution of scientific knowledge:
Kuhn also maintained that, contrary to popular conception, typical scientists are not objective and independent thinkers. Rather, they are conservative individuals who accept what they have been taught and apply their knowledge to solving the problems that their theories dictate. Most are, in essence, puzzle-solvers who aim to discover what they already know in advance - "The man who is striving to solve a problem defined by existing knowledge and technique is not just looking around. He knows what he wants to achieve, and he designs his instruments and directs his thoughts accordingly."

During periods of normal science, the primary task of scientists is to bring the accepted theory and fact into closer agreement. As a consequence, scientists tend to ignore research findings that might threaten the existing paradigm and trigger the development of a new and competing paradigm. For example, Ptolemy popularized the notion that the sun revolves around the earth, and this view was defended for centuries even in the face of conflicting evidence. In the pursuit of science, Kuhn observed, "novelty emerges only with difficulty, manifested by resistance, against a background provided by expectation."

And yet, young scientists who are not so deeply indoctrinated into accepted theories - a Newton, Lavoisier, or Einstein - can manage to sweep an old paradigm away. Such scientific revolutions come only after long periods of tradition-bound normal science, for "frameworks must be lived with and explored before they can be broken." However, crisis is always implicit in research because every problem that normal science sees as a puzzle can be seen, from another perspective, as a counterinstance and thus as a source of crisis. This is the "essential tension" in scientific research.

Crises are triggered when scientists acknowledge the discovered counterinstance as an anomaly in fit between the existing theory and nature. All crises are resolved in one of three ways. Normal science can prove capable of handing the crisis-provoking problem, in which case all returns to "normal." Alternatively, the problem resists and is labeled, but it is perceived as resulting from the field's failure to possess the necessary tools with which to solve it, and so scientists set it aside for a future generation with more developed tools. In a few cases, a new candidate for paradigm emerges, and a battle over its acceptance ensues - these are the paradigm wars.

Kuhn argued that a scientific revolution is a noncumulative developmental episode in which an older paradigm is replaced in whole or in part by an incompatible new one. But the new paradigm cannot build on the preceding one. Rather, it can only supplant it, for "the normal-scientific tradition that emerges from a scientific revolution is not only incompatible but actually incommensurable with that which has gone before." Revolutions close with total victory for one of the two opposing camps.

NoEyeSee(+_+)RE: Liberty Head -- Ethanol as fuel!#1413532/5/06; 06:57:29

I just don't care whether they are neanderthals or not. It is not a matter of being logical or not. It is the reality!

We are talking about alternative energy sources. Using ethanol as substitude just make the situation worst not better. It is as stupid as to invent a solar-energy torch!

The government just quoted something, anything to comfort and fool the public, pretended there are alternative choices! Most US presidents said that type of stupid things from 1970 onwards. Apart from more addiction on oil, nothing have been improved. ^_^
Actions speak louder than words.

There is a word call "reality-check"!

Clint HChecking In#1413542/5/06; 08:16:14

Thanks to all the great posters who have made this the top gold site. I have considered this a graduate course since 97. Thanks MK.
GoldiloxBritish Devaluation in Post #141340#1413552/5/06; 08:29:14

@ Tejbear,

Your quote "The value of the British Pound dropped around 50%, resulting in an increase of the cost of living in England by 50% . . ."

doesn't wring out in the arithmetical wash. If it takes 2 Pounds Sterling to buy what used to be bought with 1 Pound Sterling, then the inflation value is 100%, not 50%.

Other estimates I have seen of the US dollar's downward plight in '06-'07 are in the range of 30%, but we've already seen about 20% in the last couple years, albeit well hidden in the FED's hedonistic calculations. The total depreciation "target" may well be 50%.

GoldiloxScientific Dogma and the Inquisition#1413562/5/06; 09:03:22

@ Contrarian,

Nowhere has this resistance to challenging the "dogma' been greater than in Physics, which is mostly theoretical at this stage of the game. Astronomy and meteorology, however, seem to be suffering from lack of physics, as they throw the tired old greenhouse and warm-water storm theories about, with complete disregard for simple Newtonian thermodynamics. Another example is our addiction to not only oil, but very inefficient oxidation fuels in general, in our unwillingness to fully explore the nature of Earth as an electrical system.

It seems the more theoretical a branch of science becomes, the more their entrenched "dogma" becomes resistant to competing theory, and we certainly see an active example in the science of "Economics", where there is little but Keynesian apologetics for bankster-government pillage from the "mainstream" economists.

While some here have described government as "Neanderthals", I prefer to look at them as "Inquisitors," who are by their very office unable to challenge the hierarchy that pulls their strings. Worse yet, they actively discredit any attempt to drag our sciences (physical and social) into the future. Kicking and screaming are the earmarks of immature tantrum, as is character assassination. There is no better way to kill an idea than demonize the proponents. These people are not stoopid, but very smart, in a childish, Phyrric sort of way. They just want to paint reality their "own" way.

USAGOLD / Centennial Precious Metals, Inc.A special combo of assets and info to help you get started with grace and confidence#1413572/5/06; 10:17:25">gold ownership starter kit
UsulEthanol as fuel#1413582/5/06; 12:33:11

Ethanol, created by fermenting some kind of crop, and concentrated by distillation. Is there any reason why this could not have been done to create fuel at any time since the development of the steam engine? Why, the steps involved are technologically far simpler than much of the technology required for extracting oil. If this were a cost-effective way to provide power, surely it would have been done a long time ago and displaced other technologies.
DemosthenesCheck-in#1413592/5/06; 12:41:22

I usually get a chance to look over recent messages every few days. I rarely post, but greatly enjoy reading the discussion here. The "signal to noise ratio" is much better here than at other sites, and I still get to chuckle at the occasional "weather control" post. I have owned precious metals for almost a year now, both gold and silver. I love them both equally.

Not to be a downer, but I came across this story on reuters. So we remember what some people go through to bring us out gold.

Bascom ToadvineJust checkin' in#1413602/5/06; 12:53:02

Lurker par excellance
OvSHello Bascom Toadvine,#1413612/5/06; 15:18:30

Long time no see. Did Glenda
the good witch of the North
wake them up?

Golden LionheartJ P Morgan Chase#1413622/5/06; 15:37:35

A few weeks ago I reported that J P Morgan Chase had bought 8% of the shares in an emerging Australian gold producer. They have now upped their stake in the company to 9.1%.
Make what you want of that information but to me it indicates that J P Morgan Chase see the price of gold trending higher.

R PowellFarfel#1413642/5/06; 15:53:33

I was saddened by the news. I'm glad he saw, at least, the birth + baby steps of the gold bull which he so vehemently advocated. His fervored + sometimes surpassed that of even Hoosier's. Shalom Farfel.
R PowellGrammer#1413652/5/06; 15:55:29

Let me try that again.....

"His fervor sometimes surpassed even that of Hoosier's"

David LinkleyAmerica in winter#1413662/5/06; 16:13:51

I highly recommend reading "The Fourth Turning" by Strauss and Howe. It outlines history as being cyclical (rhyming)and especially the past 300 years in America. Each 80 - 100 year period has 4 seasons (spring, summer, fall, winter). The US is now entering the winter period.

They document that the last 3 times a "boomer generation" becomes the oldest generation assuming the reins of power both corporately and in government in the US was pre - Revolutionary War, pre - Civil War and pre - WWII. It is not a positive or negative book but a historical one.

It is about systems that don't work well anymore and have to be replaced. Any bells ringing? Does education, health care, energy or government really work well today? We've begun a move to a new age whatever that is replacing the industrial age. It could be a mild winter or a harsh one.
The US so far has a good track record.

Prepare yourselves, I fear most our own government and bad money both of which must be remedied before we can move to a better country. Good luck and buy plenty of gold while you can.

contrarianParadigm Shift and Currencies#1413672/5/06; 16:20:30

I imagine the paradigm shift "paradigm" can be extended to currencies--that is, we are now under the fiat currency "theory" or regime, and the only logical end result is its total discreditation, to be supplanted by its opponent, gold and silver, with no in least until the next time around in the far future (as per The Fourth Turning)!

I quote again:
"Kuhn argued that a scientific revolution is a noncumulative developmental episode in which an older paradigm is replaced in whole or in part by an incompatible new one. But the new paradigm cannot build on the preceding one. Rather, it can only supplant it, for 'the normal-scientific tradition that emerges from a scientific revolution is not only incompatible but actually incommensurable with that which has gone before.' Revolutions close with total victory for one of the two opposing camps."

ChallyMERCY! The stars aligned this weekend...#1413682/5/06; 16:22:26

I've been reading here for 2 years, all the daily goodies + the archives of A/FOA, and also Jim Sinclairs' site +plus the writings of Dr.A Fekete, and the recurring theme of the 'carry trade' and the manipulation of the gold price.

I must admit, as many times as the topic came up, and with all the various explanations, I ALWAYS, always came awway feeling like I wasn't understanding the mechanisms behind the machinations.

Then I followed the Whitewaterwoman link to the Cheuvreux Report.

Shazam! Bang-Zoom! DOH! and Man, I shoulda' had a V-8! I think I actually felt the CLICK ;)

...but now I gotta go back and read that other stuff again, to squeeze the nuggets that I couldn't have touched before due to my incomplete understanding of what was REALLY happening!

OH well, that's for another day. Time to do the 'merkin thing and watch SB XL, which I can't even work up any enthusiasm for...this Chicago boy is still walkin round with his head in the clouds over the WORLD CHAMPION CHICAGO WHITE SOX!!!

If you're new here, or to the gold community and NOT a master of monetary science, take the time to read this Cheuvreux report. For me, it put all the pieces together. Why it hadn't happened for me until now beats me, but luckily, even without this more complete picture, I decided to walk in the path of giants (bring the body, the mind will follow!)

Have a great remainder of the weekend!

Clink!Ethanol and Eldorado in Brazil#1413692/5/06; 16:44:46

To my knowledge, the largest users of ethanol for transportation are the Brazilians. The attached article from the Economist gives an interesting history of its use, particularly pointing out why usage dropped precipitously from the mid-80's onwards - simply because the farmers got more money from sugar as a product rather than ethanol. I would be the first to agree that it is extremely difficult to calculate both the effective energy yield and net CO2 production, but I think that it is a field where we have barely scratched the surface of optimization possibilities. It also seems to be the kind of activity which is much more suited to a low-tech, local co-operative type of production rather than the high-volume mass production involved with petroleum processing. As this is the antithesis of the thinking both of big government and big oil, we should not be at all surprised that there is a considerable amount of disinformation published.

An example often cited as being a major use of hydrocarbons in agriculture is in fertilisers. The first Spanish explorer in the Amazon basin (sorry, can't remember his name) came back telling stories of a large and relatively sophisticated civilization. This led to the myth of Eldorado. Unfortunately, the Spaniard brought along all the usual host of European diseases, which had the effect of wiping out and burying the civilization in a remarkably few years. Later explorers found virtually no trace of it - the jungle repossesses its territory quickly. What has intrigued modern researchers, however, is not the presence or otherwise of gold, but that the cultivated land could not support the reported population using available techniques on the relatively poor soil of the Amazon. But it appears that they had knowledge of a certain type of partially self-regenerating compost which allows much higher yields than deemed possible. The secret of starting and maintaining the process was largely lost, and is only now being actively investigated. This could obviously have a major impact on the required rate of deforestation in the Amazon jungle, as the cleared land quickly loses its few nutrients with overfarming.

As Sir Contrarian pointed out in his excellent post this morning, significant scientific changes generally take place as a result of revolution rather than evolution. I think that in the next few years we will be seeing many revolutions on a larger or smaller scale, as the current paradigms of centralized production and subsequent worldwide distribution are supplanted by much more localised efforts. The same may also be true of the political system, with devolution of powers away from central government.


PS. I particularly like the quotation of Max Plank (of Constant fame) :- "Science advances funeral by funeral"

real1Silver and gold E waves counts#1413702/5/06; 16:50:02

Check out the chart and info at this site:
mikalHaiku#1413712/5/06; 18:53:10

Gold supertankers
plow oceans unseen, unheard-
old superhighways.

jiChecking in#1413722/5/06; 19:24:33

allmost every day.
PriusNew to Forum#1413732/5/06; 19:44:44

Thanks to everyone here for the beginning of a great education. I've only been around for about 6 months and have gained a great deal of knowledge already. In the past 6 months I've checked this forum at least twice a day. A special thanks to our gracious hosts.
AllanCJohn Embry hits back at the Economist magazine#1413742/5/06; 19:48:07

Modern Economists!! What will they say next....

The Economist Magazine is notorious for ridiculing gold. Here John lets them have it.

John Embry: "If gold has disappointed, it is only because the central banks and their bullion-bank cronies have made a concerted effort to suppress the price by surreptitiously dumping thousands of tones of gold into the market over the past 10 years while further holding back the price with the extensive use of derivatives. Now that they are finally getting stuffed, they are reduced to petulant, essentially incorrect articles intended to mislead the public."

(end quote)


The editors at the Economist have been wrong so often about gold, they should stop pretending to give investment advice.

Simply put, the reason people are turning to gold is the current unsustainable growth in the world's money supplies.
You don't need to be a scientist to figure out that when the value on one side of the equation is changed, so too will the other side change.

Modern economist tend to disparage gold, because like scientists, they feel that man has unlimited capacity to influence and control events rather than the opposite. They don't want to admit that at times, man's tampering with basic economic laws can result in undesirable, uncontrollable and unpredictable consequences. They tend to view currencies as a constant, by which the effects of central banking money creation are mitigated by interest rate policies. Events surrounding the fall of the Soviet Empire should have taught them that central planning is inconsistent with true free markets.

But history has also taught us that interest rate policies alone are not sufficient when investor confidence is eroding. When central banks signal that they are losing control of the money supply, such as the recent decision by the Federal Reserve to cease publication of M3 monetary aggregates, people will eventually turn to another form of saving, be it real estate, stocks, gold or commodities. In the end monetary inflation eventually leads to price inflation.

And finally the free markets will dictate the price of gold, and there is nothing the economists can say, do or wish for, that can alter that outcome.

tejbearcontrarian Re: msg#: 141352#1413752/5/06; 21:27:22

Sterling devaluation

First, thanks for your compliment. In these days conflicting views, spin and double speak, it is difficult to see forward. I certainly agree with your assessment about people having difficulty seeing through their paradigm curtains. No doubt, like me, like me, I would imagine you have struggled with this problem most of your life.

With regard to the drop in value of the sterling pound, I have typed in several paragraphs from Rothbard's book "What Has Government Done to Our Money". Please note I did skip some unrelated information. The quotes are as follows:

"By the end of World War I, the inflation in Britain had brought the pound down to approximately $3.50 on the free foreign exchange market. Other currencies were similarly depreciated. The sensible policy would have been for Britain to return to gold at approximately $3.50, and for the other inflated countries to do the same. Phase I could have been smoothly and rapidly restored. Instead, the British made the fateful decision to return to gold at the old par of $4.86. It did so for reasons of British national "prestige" and in a vain attempt to re-establish London as the "hard money" financial center of the world. To succeed at this piece of heroic folly, Britain would have had to deflate severely its money supply and its price levels, for a $4.86 pound British export prices were far to high to be competitive in the worlds markets. But deflation was now politically out of the question, for the growth of trade unions, buttressed by a nationwide system of unemployment insurance, had made wages rates rigid down ward; in order to deflate, the British government would have had to reverse the growth of its welfare state. In fact, the British wished to continue to inflate money and prices. As a result of combining inflation with a return to an overvalued par, British exports were depressed all during the 1920s and unemployment was severe all during the period when most of the world was experiencing an economic boom." Pg 95.

"How could the British try to have their cake and eat it at the same time? Be establishing a new international monetary order which would induce or coerce other governments into inflating or into going back to gold at overvalued pars for their own currencies, thus crippling their own exports and subsidizing import from Britain. This is precisely what Britain did, as it led the at the Genoa Conference of 1922, in creating a new international monetary order, the gold-exchange standard." ……….. Pg 96.

"Now when Britain inflated, and experience a deficit in its balance of payments, the gold standard mechanism did not work to quickly restrict British inflation. For instead of other countries redeeming their pounds for gold, they kept the pounds and inflated on top of them. Hence Britain and Europe were permitted of inflated unchecked, and British deficits could pile up unrestrained by the market discipline of the gold standard. As for the United States, Britain was able to induce the United States to inflate dollars so as not to lose many dollars reserved or gold to the United States"…… Pg 97.

"As the sterling balances piled up in France, the United States, and elsewhere, the slightest loss of confidence in the increasingly shaky and jerry-built inflationary structure was bound to lead to general collapse. This is precisely what happened in 1931: the failure of inflated banks throughout Europe, and the attempt of "hard money" France to go off the gold standard completely. Britain was soon followed by other countries of Europe." Pg 97.

"The world was now back to the monetary chaos of World War I, except that now there seemed to be little hope for a restoration of gold. The international economic order had disintegrated into the chaos of clean and dirty floating exchange rates, competing devaluations, exchange controls, and trade barriers: international economic and monetary warfare raged between currencies and currency blocs. International trade and investment came to a virtual standstill; and trade was conducted through barter agreements conducted by governments competing and conflicting with one another. Secretary of State Cordell Hull repeatedly pointed out that these monetary and economic conflicts of the 1930s were the major cause of World War II…… Pg 97-98.

"The new international monetary order was conceived and then driven though by the United States at the international monetary conference at Bretton Woods, New Hampshire, in mid-1944, and ratified by the Congress in July, 1945. While the Bretton Woods system worked far better than the disaster of the 1930s, it worked only as another inflationary recrudescence of the gold-exchange standard of the 1920s and-like the 1920s-the system lived only on borrowed time."

The new system was essentially the gold-exchange standard of the 1920s, but with the dollar rudely displacing the British pound as one of the "key currencies". Now the dollar valued at 1/35 of a gold ounce, was to be the only key currency. The other difference from the 1920s was that the dollar was no longer redeemable in gold to American citizens; instead, the 1930s system was continued, with the dollar redeemable in gold only to foreign governments and their central banks"…….. Pg 100.

There being plenty of room for inflation before retribution could set in, the United States government embarked on its post-war policy of continual inflation, a policy it has pursued merrily every since. Be the early 1950s, the continuing American inflation began to turn the tide of international trade. For a while the United States was inflating and expanding money and credit, the major European governments, many of them influenced by "Austrian" monetary advisers, pursued a relatively "hard money" policy (e.g., West Germany, Switzerland, France, Italy). Steeply inflationist Britain was compelled by its outflow of dollars to devalue the pound to more realistic levels (for a while it was approximately $2.40)."

Please note how the English couldn't politically correct their currency problems anymore than the US government. When Walter Mondale announced he would raise taxes, the "people" voted for Bush senior, who had promised not to raise taxes, and then after he won the election, he of course, promptly raised taxes, without the support of the democrats.

The complexity of the current situation is unfortunately more complicated and more depressing. No wonder those reading the Wall Street Journal think the world is just dandy....

I hope the sterling information is useful to you.

The Bear

mikalModeling man-made disasters#1413762/5/06; 22:46:38

Professor Uses Math, Science to Predict Terrorist Targets - AP - February 5, 2006
Unlike central computers and wild showers of cash, gold stands tall as a redwood as a cornerstone of personal security and safety in times of war or disaster.

tejbearGoldilox Post #141340#1413772/5/06; 22:58:56

Math & devaluation:

With regards to the math: you are correct. The devaluation of the sterling pound from $4.86 to $2.40 would increase the cost of living roughly 100%.

As far as calculating how far the dollar can drop, tough question. If the other CBs work together carefully with China, the dollar may only go through a 50% total drop. But in today's fiat world, there are other things in play. One of Warren Buffet's fear is the collapse of the derivative market, now reported to be ~$270 trillion dollars, (could oil trigger this collapse). Add to this helicopter Ben running the "presses" at such an increasing pace that he will stop reporting M3 in March ‘06, when Iran starts their oil exchange selling in Euros. Why is Ben afraid to continue to publish this data?

To successfully wade through these and other issues would take great leadership with vision. Instead, we have watched the conservative majority become the party of the spendthrift, pushing deficit spending to new highs, while entangling the US in an unending unnecessary conflict, with increasing causalities and costs. If their spendthrift ways continue unchecked, they will accelerate the debasement of the dollar, resulting with the United States devolving into a "has been" superpower, without the funding for Social Security, Medicare, pensions or even a strong military.

As a consequence Goldilox, I fear for the future. The problems the US faces are enormous. As you are probably aware, the current administration fills important positions with political lackeys. This is evidenced by the failure of FEMA after Katrina, the CIA before Iraq and the recent first ever argument between the Board of Science and the EPA Administrator. Political lackeys are just that, political hacks, who do a political job, unconfused by the facts. The very people with the skill sets we need to run the country are leaving government in droves. Even the Federal Reserve is having problems getting replacements. Sorry for such a poor situation assessment.

Good luck to you,
The Bear

968Install yourself in a chair...#1413782/6/06; 02:58:16

...and listen !
masFrom the Privateer#1413792/6/06; 06:52:20

Interesting that all are looking at a major change in the next couple of month's. We all know it's coming, just don't know how it will show. Belgian?
Here's their take.
The Next Two Months Are Pivotal:
The first debt limit increase of the Bush Presidency took place in early 2002 and coincided almost exactly
with the beginning of the bear market in the US Dollar. That US Dollar bear market hit its bottom (so far)
in late 2004, shortly after the most recent debt limit increase was passed into law. We are looking at
another debt limit increase - to very close to or over the $US 9,000 Billion level - by the end of March.
Mr Bernanke became Fed Chairman this week. Historically, markets "challenge" a new Fed Chairman
early in his tenure. One market at least has been challenging Mr Bernanke ever since he was nominated
for the job by President Bush on October 24, 2005. On that day, the spot future Gold price closed at $US
465.00, less than $US 10.00 above the price it had reached ten months earlier in December 2004. Not
much more than three months later, on February 2, 2006, the spot future price closed at $US 572.50.
Next week sees the return of the thirty-year bond to the arsenal of Treasury borrowing. By the end of this
auction, the Treasury will be at or very close to its debt limit - on a debt "subject to limit" basis. The
yield curve is now inverted. The longer it stays inverted, the more dangerous the situation becomes.
In March, the big financial events will be the debut of the Iranian Oil Bourse which is scheduled to take
place on March 20 and the end of US "broad money" (M-3) reporting due to take place on March 23.
The major paper markets have not thrown Mr Bernanke a "curve ball" yet. They will. The European
Central Bank did not raise EU rates when they met this week, but they made it as clear as Central Bankers
ever do that they plan to do so at their next meeting. With yields on 30-year Treasury paper now only 13
basis points above the Fed Funds rate (and only 1 basis point above six-month yields), US interest rates
have no downside at all. The next two months are going to be VERY dangerous. Be prepared.

goldpuppyif the next two months are dangerous how to prepare?#1413802/6/06; 07:08:11

Mas, if this is so, do you have any solutions on how to prepare? Would holding gold and silver bullion be an answer? How about gold stocks? Or get out from all gold, silver bullion and stocks and energy and wait until the price plumets? You state the problem but no solutions. Any suggestions?
GoldiloxM3: Still going#1413812/6/06; 07:55:25


I mentioned this a couple in last week's report for subscribers: The M-3 rate of inflation seems to have dropped into what looks like a 12-13 week cycle over the past year. Not that it's a tradable idea by itself, but it's an interesting eventuality and something I've speculated might be part of a global synchronized effort by central banks to ramp up inflation. While the Federal Reserve is doing away with M-3 (we call the move "hide the monetary sausage").

I'm anxiously awaiting the update of the M-3 report (part of the H.6 money stocks report which is reported weekly here) so that we can see the January M-3. If I'm right about this emergent global entrainment, it should show a rate of increase around 10-12 percent (M-3, annualized, not seasonally adjusted - NSA). Seasonally adjusted it should look like around 6.5% on the December-January annualized number. Notice how that 6.5% is my predicted trailing twelve months inflation forecast for the first half of 2006? The June to December rate annualizes to 10% (NSA) and the YoY rate is 7.7%.

I built a little spreadsheet which I call my "Inflationator" where I can plug in month-on-month changes and pop out the annualized rate without having to think on Monday mornings. It shows the M-3 rate in the latest reporting month (December) was up 16.56% (NSA) and 10.07% annualized on a seasonally adjusted basis. Shock and awe: Seasonally adjusted, the annual rate of increase is only 10%. But hey, what are seasonal adjustments for, anyway?

I dribble on endlessly about this because it makes the case that Alan Newman has made so many times over at "Pictures of a Stock Market Mania" - namely that things are off in the nonlinear portion of the curve. That's the "magic of compound interest" at work, huh?

- Goldilox

While the hedonistic bubble-heads still try to convince us that inflation is measured by the phony CPI and PPI, George has tied it back to monetary growth - where it belongs.

GoldiloxSolutions#1413822/6/06; 08:01:36

@ goldpuppy,

Are you really asking for solutions, or just short-term investment advice?


Stay as far from the paper markets as you can. Get out of debt, stash non-perishable food and potable water, and enough cash and/or transactable sized gold and silver to get through about six months of turmoil.

If you don't end up needing them for survival, they will not hurt you in any way, as inflation will probably more than cover their cost many times over.

GoldiloxOil one of many U.S. addictions#1413832/6/06; 09:06:39


Economists see record trade deficits in '05 and beyond

By Greg Robb, MarketWatch
Last Update: 12:01 AM ET Feb. 4, 2006

WASHINGTON (MarketWatch) -- President Bush's comment that America is addicted to oil from the Middle East generated plenty of headlines, but it's just one in a long list of addictions to imported goods that could have been named, economists said.


More of the effects of globalism. While TPTB execute a "Chinese Firedrill" into more and more globalism, they decry it's affects on local economies.

Go figure!

USAGOLD / Centennial Precious Metals, Inc.SINCE 1973 -- Proven Reliability, Longevity, Quality and Professionalism. Invest with Confidence!!#1413842/6/06; 09:27:29

GoldiloxBush proposes $2.77 trillion budget#1413852/6/06; 09:28:58


More money sought for defense, cuts in most other areas

By William L. Watts, MarketWatch
Last Update: 11:13 AM ET Feb. 6, 2006

WASHINGTON (MarketWatch) -- President George W. Bush on Monday sent Congress a $2.77 trillion budget request that would boost defense spending, while trimming Medicare and other government programs even as first-term tax cuts are extended.

"As this budget shows, we have set clear priorities that meet the most pressing needs of the American people while addressing the long-term challenges that lie ahead," Bush wrote to lawmakers, in a letter accompanying the four-volume, 2,400-page document. "The 2007 budget will ensure that future generations of Americans have the opportunity to live in a nation that is more prosperous and more secure."

The budget request would mark a 2.3% rise in total government spending in fiscal 2007, which begins Oct. 1. The White House, meanwhile, expects the government to end the current fiscal year with a deficit of $423 billion - an record high in dollar terms.

While describing the 2006 deficit as "unwelcome," the budget plan contends the deficit remains manageable and is on track to be significantly reduced, but not eliminated, by the end of Bush's second term.

As a percentage of the economy, a more relevant measure, the deficit is estimated to equal about 3.2% of gross domestic product

As previously outlined by administration officials, the White House requested a Defense Department budget of $439.3 billion, an increase of nearly 5%.

Outside of the Pentagon and other security-related spending, the White House targeted 141 programs for sharp cuts or elimination, in a bid to save $14.5 billion in fiscal 2007, Bush also seeks to cut projected spending on mandatory entitlement programs by $65 billion over five years, with the bulk coming from measures designed to hold down outlays for Medicare, the health-care program for the elderly, by $36 billion through 2011.

- Goldilox

Our other "addiction", profligate government spending

TownCrierEuro-denominated POG at ATH#1413862/6/06; 10:10:15

See bottom graphs at link.

Even though the price of gold in euro terms is at an all time high, you will NOT hear any comments from any monetary official in euroland fretting that this is troubling in any way.

That isn't to say that they are blind, deaf, or mute too pricing developments for any and all items across-the-board. By contrast, you DO, in fact, hear cautionary comments directed to oil producers about potential impacts of higher oil prices, and comments to 'social partners' about the desire to curb wages and other price hikes to limit second round effects, etc.

In America, the price of gold has always been closely watched as an inflation indicator, and thus its (low) price has always been cited by monetary officials as a sign that all is well with the dollar system. Similarly, a high price often raises eyebrows along with worried expressions that "something needs to be done".

For reasons that have already been well-covered, that is simply not the case these days in euroland nor in a growing number of other monetary blocs. Please recall a very clear example I cited in the news a couple weeks ago in which Vietnam indicated that gold prices were to be specifically excluded from its overall price-stability assessments for purposes of managing domestic monetary policy.

You can expect that Russia will be in this camp, also Switzerland, along with all others with central banks who are in or moving toward a mark-to-market regime of floating gold-centered reserves.

In summary, this isn't really a news item so much as a 'heads up' and explanation why all time high gold prices in europe are being met with calm and confident silence by the monetary officials.


TownCrierA picture (and a portfolio) that's worth a thousand words...#1413872/6/06; 10:27:23

"Gold were as good as twenty orators."
-- William Shakespeare (1564-1616)

"Gold is a deep-persuading orator."
-- Richard Barnfield (1574-1627)

"The tongue hath no force when gold speaketh."
-- Guazzo

"In spite of all the romantic poets sing,
this gold, my dearest, is a useful thing."
-- Mary Leapor (1722-1746)

"Gold opens all locks -- no lock will hold against the power of gold."
-- George Herbert (1593-1633)


contrarianDow Crash?#1413882/6/06; 10:38:29

Good article discussing Dow...although I've been singing the same old tune for three years now, and it hasn't happened yet, and with the Hindenberg omen, it looked like it was going to happen in November/December, it looks like come March there may be some surprises in I second the excerpt from The Privateer.

It was a 38%, two and a half year plunge, but I reckon second time will be more severe and faster, as the memories of the bull market have faded and expectations are lowered.

I wonder, though if stocks will fall and then the dollar, or simultaneously, or the dollar first and then stocks? Would be interesting to hear other viewpoints. If there's a new war, certainly gold will go up, but didn't the stock market actually go up during the various Gulf wars?

The US economy is a corpse, and the economic statistics are all doctored as we know. Same was the case with the last days of the Soviet empire, where the government said everything was great but the people knew better. "We pretend to work and they pretend to pay us."

What will be the catalyst event for the stock collapse? I think that's all it needs, because it's hollowed out and just needs a little push.

The volatile activity of Google, the recent drastic drops, I think is a warning sign, of the last dying breath of the interim bull phase and the resumption of the secular bear market...I suppose eventually down to Russell's 3000 target, or even lower maybe.

GoldiloxGold quotes#1413892/6/06; 10:47:27

@ TC,

"The tongue hath no force when gold speaketh."
-- Guazzo

In modern idiom, "Money talks and BS walks".

SurvivorCheuvreux Report#1413902/6/06; 10:57:21

@Chally or Whitewaterwomam

Would one of you (or anyone) please re-post the Cheuvreux Report link?

Thanks in advance
- Survivor

ThoreaulyHOOSIER GOLDBUG#1413912/6/06; 11:09:01

Can anyone tell me why he believes that Another, Friend of Another, Belgian, Aristotle, et al., "no longer post here because they have read/know the writing on the wall, far greater than I even understand that NOTHING IS GOING TO CHANGE AND IN THE END THE GOLD CARTEL IS GOING TO WIN IT ALL"?

If this isn't why they left (and I certainly hope it isn't), then why did they?

contrarianTipping Factor for Stock Market#1413922/6/06; 11:10:36

Perhaps a plausible possibility for the tipping factor could be oil--an embargo, or the taking out of the Strait of Hormuz, making delivery from the Mideast impossible.

If so, it'll be the 70s all over again, and that's really not surprising.

From Urban Survival:
"I'd love to be wrong on this one, but I'll be filling up our propane tank as soon as we're through the heating season this year, on the chance that this fall we will be in an oil embargo, gas lines, and the "restrictions on travel" that the web bots have been pointing to for some time. Remember, it's our experience in this fledgling science of peering through time based on shifts in language that the more lead time we get about an event, the more emotionally powerful it will be. Thus, the impact on our country and general mindset of "restrictions on travel" late this year will likely be nothing short of huge. If the bots continue to be right."

Thoreauly@ Survivor re Cheuvreux Report#1413932/6/06; 11:14:42
TownCrierChina's first gold fund may be created#1413942/6/06; 11:32:29

2006-02-07 Beijing -- THE China Gold Association is considering forming the country's first gold fund with partners.

"Some association members have discussed the program to start a gold fund to tap China's gold market... It's still only a proposal at this stage and we have not yet contacted banks or gold companies about further moves."

Gold's investment allure is strong as the central government has opened the individual gold investment sector with more products.

There are several ways for investors to jump on the gold bandwagon. The Shanghai Gold Exchange allows investors to purchase and take gold bars home as well as paper transactions where the buyer does not take it home.

Investors can also purchase shares in a gold miner such as Zhongjin Gold Corp or purchase coins and jewelry on the retail market.

Rising gold prices plus market reforms have attracted more investors.

Trading value and volume on the Shanghai Gold Exchange has grown since the country's sole bourse for gold and platinum opened in 2002.

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


mikalGold eyes $2200 appetizer#1413962/6/06; 13:13:39

Gold Bugs Eye $600, $850 and Far Beyond - Nick Godt - February 6, 2006
mikalInvestors waking to gold#1413982/6/06; 14:18:20

Still Going Heavy on the Metal - Katherine Pulvermacher(World Gold Council)- February 6, 2006
Flatliner@Thoreauly#1413992/6/06; 14:21:37

That is the 64,000 ounce question. Why did they leave?

If anyone knew the answer to this, I would expect that it would be MK and team. At the same time, I would also expect that information to be held in confidence by our grateful host. Even if these former members where to rejoin, would they be the ones to drive this forum to the next stages?

The groundwork laid years ago has proven to be very solid. Gold is coming back as the one true international store of wealth. Central banks and some governments have, and are continuing to take, baby steps towards opening the doors for Gold. This news is unfolding before our eyes as TC has made very clear in his daily posts.

Even in the absence of those that might have known the original plan, it appears that the information that they discussed here are - long - from having completely come to pass. We watch and read.

What I find interesting, at this juncture, is how the emotional switch into using gold as a store of wealth rather then currencies and how that change will play out. Seeing the Cheuvreux gold report leads one to believe that the effort to educate the public has moved up one notch. Unfortunately, I don't see this as being all good news.

Good news: This report will (and already has) given credibility to the work that GATA has done and I'm sure it will hit every western investor with high interest. I mean, who's going to turn down such a hot investment?

Bad news: All western investors deal in paper - all these investment houses will most likely push paper gold which implies, as we all understand in his forum, that one of the true functions of gold will not surface. In particular, it is the function of trusting the middleman. Every form of paper gold requires one to extend trust to others. Physical gold has one extend trust to only oneself.

I believe that the GATA work is at a critical turning point with regards to exposing the suppression of gold. On an emotional level, people in general are very afraid to hold physical gold. That fear feeds the paper gold market rather then the physical gold market.

This is where, I believe, everyone in this forum can really make a difference. Take your cue from Russia. They have announced weeks ago that they will be buying gold on any and every market, but have they? It seems that they really have only bought in the physical market. Any CB and any government could mint enough money to buy every futures contract in the entire world, but, they know this market doesn't serve the real function that they need. They need physical. All they court is physical. Because they buy physical, they might do everything in their power to distract everyone else in the world so they can keep buying physical. We, as a small group of people though simple discussion could spread the word about the benefit of physical gold over all alternatives.

Send an email, or make a phone call - but make some conscious effort to save someone you might know that's looking to buy paper gold. Educate them from what you've learned in this forum. There will only be a small set of really lucky people and they will be holding physical gold then the promises of paper gold are broken. The alternative is to keep your mouth shut and watch as people liquidate the paper gold market. That, will not be a pretty sight amongst all the other bad things that are happening in this world.

USAGOLD Daily Market ReportPage Update!#1414002/6/06; 14:43:40">
The Daily Gold Market Report has been updated.

If you are considering investments in gold we invite you to">request our free introductory information packet detailing the products and services offered by USAGOLD ~ Centennial Precious Metals. We welcome your inquiry and look forward to working with you.

MONDAY Market Excerpts

February 6 (from MarketWatch) -- Gold futures closed almost $3 an ounce higher Monday as the International Atomic Energy Agency's decision to refer Iran to the United Nations on concerns about its nuclear program prompted investors to get defensive.

April gold contracts closed up $2.70 at $574.30 after trading as high as $578.

The IAEA voted to refer the Tehran government to the U.N. Security Council over the weekend, citing an "absence of confidence" that Iran's recently resumed nuclear program is aimed at peaceful civilian-energy generation. The IAEA also cited a "history of concealment of Iran's nuclear activities".

It called on Iran to stop its uranium-enrichment activities; consider stopping building a heavy-water reactor suspected of being used to create plutonium for nuclear weapons; and give the IAEA greater access to the country's nuclear program activities.

Iran immediately rejected the IAEA resolution, and said that it will no longer allow snap checks of its nuclear sites. However, a foreign-ministry spokesman said that the country will go ahead with a meeting with Russia scheduled for Feb. 16 on a proposal that it enrich uranium inside Russia, the BBC reported.

Gold climbed to as high as $579.50 an ounce on Thursday, a level not seen since January 1981. Most analysts expect prices to reach $600 an ounce, but Peter Grandich, editor of the Grandich Letter warned that from there, gold may be poised to see a significant correction.

Looking further ahead, Bart Melek, a senior economist at BMO Nesbitt Burns, said that gold prices will likely reach $700 by the end of the year, averaging $610 this year and $660 in 2007.

"Private-portfolio and central-bank reserve rebalancing will be a well-ordered risk management exercise that will continue to slowly tighten gold-market conditions and will be played out over years, and not weeks or even months," he wrote in a research note.

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

Thoreauly@ Flatliner#1414012/6/06; 14:52:51

@ Flatliner

Thanks so much. If they left for the reasons Hoosier Goldbug said, then I would be deeply disappointed to hear it. Maybe we'll fine out one day.

As for spreading the word about gold, be assured that I am trying to bring others into the fold In fact, the little book club I belong to (a handful of UVA grads) starts a new book this week that is my selection -- Peter Bernstein's "The Power of Gold" -- as preparation for a fuller examination of the subject in the hope they'll all end up taking out the ultimate insurance policy.

That said, I'd be interested in your (and others') thoughts about this piece --

Flatliner@Thoreauly – an open mind leads to many answers.#1414022/6/06; 15:53:37

I hope that my participation is not the only one with regards to your query!

Every once in a while a theory comes along to help explain what previously was only explained via faith. At one point, people perceived the world as flat. Over time, that crazy idea was replaced with something that made a little more sense. So goes some actions in the financial markets. I'm sure that at some point in the near future, people will look back at our current financial system and be amazed that all people didn't see it for what it was. Bad news comes out and the markets go up. Good news comes out and the markets go down. A major investment bank enters the Natural gas market the liquidity drives the price from 15 to 9 bucks in a couple weeks. Standard market forces can not completely explain or ‘naturally’ explain what is really happening.

In order to really find answers to the big picture, you (and I) are at a big disadvantage. But, if we approach our studies with an open mind and carefully weight cause and affect, we may not be able to discount theories like those presenting on the GATA sight so quickly. Personally, I have read many articles on the GATA sight and highly recommend them for everyone.

I know that I have not answered your question directly and I know that there are those that visit this sight that have closer connections to this article then I. At the same time, they might be able to address your issue, if you asked something that were a little more specific.

FlatlinerJust watching#1414042/6/06; 16:02:15

NYMEx Issues for February.

Silver 122 or 610,000 oz unchanged from Friday.
Gold 5,550 or 555,000, up from 536,200 oz. on Friday

Total Eligible in golden warehouse is shown at 2,238,478. This is up from Friday @2,212,684. Total registered 5,080,284 down from Friday @5,105,694.

Thoreauly@ Flatliner#1414062/6/06; 17:18:27

I can't really be more specific. All I can ask is how the central banking fraud/conspiracy can perpetuate itself with economic reality increasingly bearing down on it. NASA can suspend the law of gravity in its laboratories, but the global suspension of the laws of economics is a different matter altogether.

Hoosier Goldbug believes that this den of thieves already knows how to perpetuate the suspension, adding that this is why Belgian, et al., bid this forum adieu. But how can the den do so without resorting to totalitarianism on a global scale? And how long can that horror possibly last when the den mother and all the cubs are, again, thieves?

Chris PowellXAU adds Bema, Coeur, and Royal Gold to replace Placer Dome#1414072/6/06; 18:21:38

Latest GATA dispatch.

To subscribe to GATA's dispatches, send an e-mail to:

This email address is being protected from spambots. You need JavaScript enabled to view it.

Chris PowellRichard Russell's Dow Theory Letters notices GATA and Cheuvreux report#1414082/6/06; 18:23:29

Funny how something can get respectable overnight.

Another GATA dispatch.

To subscribe to GATA's dispatches, send an e-mail to:

This email address is being protected from spambots. You need JavaScript enabled to view it.

Flatliner@Thoreauly#1414092/6/06; 18:26:37

Did Hoosier Goldbug find the golden Rosetta stone behind the working in the gold market? Did others before him? It would be most interesting to know. I will keep an open mind on the topic while trying to figure it out for myself. Can the answer be found? Hoosier Goldbug, it appears, thinks so.

As I see it, the physical gold market is so small relative to the paper gold market that unless there is some serious education of the masses, any new money will flow into paper gold. If this is the case, it may be a *long* time of more of the same.

But, it's clear to me that Russia is not buying paper gold. If other countries follow their lead, we may find that the paper gold game will not continue as it is for long. I'm sure there is nothing Russia would like to do better then to stir the pot in the US.

Will things fall apart at this time? (with regards to the gold market) I don't think so. Paper pushers will settle for cash. Those that thought that they owned gold, will be disappointed. And, like a good stock market crash, all those paper gold holders will be reluctant to get back into the paper gold market. At that point, they will think very hard about what they invest in. It could be that at that point the US Dollar will hyper-inflate. It may be that other currencies will follow suit but when will that come? You get to be the judge.

In any case, it is interesting to see people lean towards Gold as real money. Hopefully, there will be enough to go around. Buy it and guard it well. It may be that you will never have to send your golden savings and you may even collect interest on it. Time will tell.

masGold Puppy#1414102/6/06; 18:57:00

Best advice is to read Black Blades recommendation.

Or from the Privateer - There is an immense crisis over the horizon. It is rolling towards us all, especially towards the USA. We
are nearly at the end of the line. The STATE is financially bankrupt and has liabilities it can't cover. If
you stand with some property held free and clear of debt and with Gold and Silver coin - you'll make it.

Remember the sun will still continue to come up in the morning...
Good luck.

PRITCHO@Chris Powell - - - Re Your Richard Russell comments#1414112/6/06; 19:57:22

It appears that GATA hates sharing the limelight with some one else - especially when that someone else has earned respect well before GATA was even thought off!

Here's Richard Russell giving the links to the "Credit Agricole / Cheuvreux report" AND the link to GATA in todays Report ---AND you are small mindede enough to bag him AGAIN - -like you did several months ago.Bleating that it's the first time he's mentioned GATA. Frankly I dont blame him as GATA has put out a lot of rubbish along with the facts. Richard Russell ALSO has spoken out about the manipulations in the market on a REGULAR basis --another issue you denied in the past --even when I went to the trouble of posting the dates & snips of the comments.

Richard Russell has been recomending PHYSICAL GOLD to his subscribers before GATA was even formed.He mentions GOLD every day in his newsletter & advocates that its the ultimate investment. You come across as an absolute loser.
I hope you & Bill can now put all this behind you as befits adults.

PRITCHOFull Comments re GATA etal from Todays Ricard Russells Comments - -#1414122/6/06; 20:01:15

How about this report below -- Russell

MANCHESTER, Conn.--(BUSINESS WIRE)--Feb. 2, 2006--Cheuvreux, the equity brokerage house of Credit Agricole, the huge French bank, this week distributed a 56-page report that completely endorses in detail the findings of the Gold Anti-Trust Action Committee that the price of gold has been surreptitiously suppressed by Western central banks and that those banks do not have the gold they claim to have.

The report, written by Cheuvreux's mining sector analyst in London, Paul Mylchreest, is titled "Remonetization of Gold: Start Hoarding." It repeatedly cites GATA by name and foresees an "unprecedented" rise in the gold price, possibly accompanied by a spike to as much as USD2,000.

The report's executive summary says:

"We are raising our mid-cycle gold price estimate to USD900/oz from USD750/oz and see the possibility of a spike to USD2,000, or higher. Covert selling (via central bank lending) has artificially depressed the price for a decade.

"Central banks have 10,000-15,000 tonnes of gold less than their officially reported reserves of 31,000. This gold has been lent to bullion banks and their counterparties and has already been sold for jewelry, etc. Non-gold producers account for most and may be unable to cover shorts without causing a spike in the gold price.

"There is a supply deficit in the gold market of around 1,300 tonnes per year before any central bank selling and perhaps 700 tonnes per year after 'official' sales but before covert selling. This compares with world gold mine output of only 2,500 tonnes per year. Some central banks, notably Russia, are starting to buy gold.

"Gold acts as an early warning of potential crisis such rising inflationary/deflationary pressures and general confidence in paper currency, especially the U.S. dollar.

A strongly rising gold price could have severe consequences for U.S. monetary policy and the U.S. dollar. History suggests that gold always wins against an inflating paper currency (that is, one subject to excessive supply growth).

"Gold and gold mining stocks are poised for an unprecedented rise in prices and profile. Investors in UK/European equities need to assess the implications for their portfolios. ..."

The Cheuvreux/Credit Agricole report details GATA's findings in Chapter IV, "Analysis of the Gold Market," and concurs in them as "broadly correct."

"No financial house in Europe could be more part of the establishment than Credit Agricole," GATA Chairman Bill Murphy said today, "and now its endorsement of GATA is circulating among other big financial houses in Europe and around the world.

"This evokes what Adam Fleming, former chairman of Harmony Gold, now chairman of Wits Gold, said at GATA's Gold Rush 21 conference in Dawson City, Yukon Territory, Canada, last August, just hours before the current sharp rally in gold began: that just a little investment demand could take the central banks out of their gold 'in the blink of an eye.'

"A LITTLE investment demand? Credit Agricole's brokerage house has just declared: Start hoarding!"

Gold Rush 21, Murphy said, "was truly historic and decisive. It gathered the world's top experts on gold to spell out, explain, and publicize the gold price suppression scheme, and the conference issued the Dawson Declaration, an appeal for free markets in the precious metals as a matter of basic human rights."

A two-DVD set of the proceedings of the Gold Rush 21 conference, including a dramatic 25-minute video summarizing the conference, produced by the brilliant Vancouver videographer Trevor Johnston, can be obtained through this Internet link:

The Cheuvreux report on the gold market can be obtained at GATA's main Internet site here:

"As for gold itself," Murphy said, "you can get some from coin and bullion dealers, but as the Cheuvreux report gets around, there may not be much left."

Black BladeGold Remains Attractive#1414132/6/06; 21:46:37

A large number of analysts expect gold prices to continue rising over the next few years. Reasons include political unrest, "worries about inflation and economic growth, instability in currency markets and hopes of buying by central banks….Almost stagnant mine supply coupled with rising output costs, growing investor interest in new tools like exchange traded funds (ETFs) and diversification by funds into commodities."

Another point to consider is the growing chorus that the Peoples Bank of China (the Central Bank of China) is once again a major buyer of gold. In fact they are the largest buyer of gold in China. They continue to buy gold through longterm contracts with a few South African miners (notably among them Harmony Gold). They are rumored to be the buyer of choice of the Swiss Central Bank Gold sales and were rumored to be the largest buyer of the Bank of England gold auctions.

I still look for higher highs and higher lows in the current secular gold bull market. We have a few years left to the current trend and there is no end in sight. The twin deficits continue to plague the US dollar and several foreign central banks and institutions are itching to lighten their load of US debt (bonds and Treasuries). The "currency war" continues as foreign central banks work hard to weaken their currencies against the US dollar for obvious reasons. The United States is the world's largest consumer market and a weaker currency compared to the US dollar in exporting markets such as China, India, Japan, etc. stimulates these economies. The tide is changing however, these countries hold a lot of depreciating dollars and they are anxious to get rid of this albatross. Gold is one reserve asset that is appealing, especially for central banks and financial institutions in the Far East.

- Black Blade

Chris PowellSorry, Pritcho, let's agree to disagree#1414142/6/06; 21:47:20

Russell's pro-gold ideology has been
of no help in the struggle against
the suppression of gold by the central
banks. Many gold ideologues have just
sat on their hands in this struggle,
the World Gold Council foremost among
them. Praising gold while its price is
falling or going nowhere, failing to
keep up with the price of other assets,
and not explaining why this is happening
only makes gold and everything connected
with it look idiotic and gold's advocates
look like cranks.

Russell repeatedly has expressed only
ambivalence about the gold suppression
issue, even when pressed to look into it.
Note that even now he's not taking a
position on the issue, just acknowledging
the issue more straightforwardly than
before, because, despite him, it's
bursting out all over.

Russell may ben overrated as an analyst
anyway, resting on his reputation. Wasn't
he pushing the "synthetic dollar short"
theory to explain the dollar's strength,
and then noting the trade and budget
deficits to explain the dollar's weakness?
Wasn't he always lauding the commercials
in the futures market as the infallible
"smart money"? You know, the folks who
are getting killed in gold now.

Russell's big problem is in failing to
recognize that the more government
intervenes surreptitiously in markets,
the less useful technical analysis
becomes. Of course technical analysis
is Russell's livelihood, and it is
becoming obsolete, especially in the
gold market. He can't WANT to see this,
but there it is.

You and I have been over this before.
But if GATA has been distributing
"rubbish" and I'm "an absolute loser,"
why, then, is Russell quoting GATA at
such length tonight? Will you write to
him and ask about his complicity with
rubbish and losers?

Russell was in a position to help the
gold cause and the cause of free
markets but, like most people in the
financial establishment, he declined
until the battle turned. He wouldn't
risk his reputation.

He reminds me of the old Alfred E.
Newman saying: "Some people are like
blisters. They show up right after the
work has been done."

YGMPritcho#1414152/6/06; 21:48:24

take a valium along w/ Hoosier and get some rest. You'll be fine in the morning. Chris Powell happens to be every bit a gentleman and he can spell also...YGM
PRITCHO@ Chris Powell - -- - - Twisting in the Wind #1414162/6/06; 22:24:45

So you majored in propoganda & are a hero in your own mind - - I'll say it again that GATA has put out a LOT of rubbish along with the facts. The "rubbish" is what has turned a lot away from your core message. That message was & is to get as m,any as possible to understand that GOLD is & was way undervalued. Trashing Russell does NOTHING to aid that & only makes you & GATA even more suspect.

I have always supported GATA --for the core reasons.That doesn't blind me to the stupid talk & character assination against someone of Richard Russells ability & reputation.

The vitriolic critism you displayed in your response suggests to me that there may be some other explanation for such extraordinary outpourings.Ah well at least YGM loves ya.
PS -- no need to respond

Chris PowellVitriolic criticism?#1414172/6/06; 22:45:58

Pritcho, I've reviewed our posts tonight
and the only thing in them that strikes
me as possibly "vitriolic criticism"
was your reference to me as "an absolute
loser." Please let me know what I'm
missing so I may apologize.

KnallgoldFreeGold#1414182/7/06; 00:08:28

"Another, Friend of Another, Belgian, Aristotle, et al., "no longer post here because they have read/know the writing on the wall, far greater than I even understand that NOTHING IS GOING TO CHANGE AND IN THE END THE GOLD CARTEL IS GOING TO WIN IT ALL"?"

Do you really believe they will give up now,after 20+ years of waiting and preparation?

I think it was a poster JacobMarley(?) who gave an alternative if the transition will fail:complete worldwide agony.

goldpuppyMichael Bolser and the Plunge Protection Team#1414192/7/06; 00:19:05

Thanks Mas. I was listening to Michael Bolser, an expert on government interventions, at and he thinks that the Feds and the Plunge Protection Team are hiding something up their sleeves, like several tons of physical gold (no one knows about) which they will deliberately drop all at once on the market to hide the fact that the US dollar is basically toast and to sucessfully sell their 10 year treasury bonds in order to continue to prop up the US fiat currency. He reckons that the Feds have had many years of thinking and planning for this moment and have mapped out a plan to deliberately let gold price keep rising, luring more people in, then plunging the price of gold to scare away the gold investors again as they did many times before. Don't forget that this is also an election year for Congress and they need to look good. Could this be why Goldman Sucks is still adding to their short positions and that they have insider information and know something that we don't? What do people think?
YukonVery, very, very late for checking in....but....#1414202/7/06; 00:20:14

Greetings to all! Have been reading here since approximately 1998. Dont have as much time for surfing the table round as I once did (as two new family members keep me scrambling...for their safety and my sanity!) After reading over the past several days posts and seeing a few names from back before y2k, I thought i would give a shout out and let you all and MK know how much i appreciate all the knowledge shared here.

Gold and Silver and many other commodites have a huge fundamental base for their continued upward moves. As I prepare my taxes for submission, I am reminded that the fraud being perpetraded today on we the people is insane. The power structure in this country has been completely reversed and that is by design for sure;(accomplished with legal finesse, corruption at all levels and a desire for power). Events are coming that will one day shake the world to its core. Do what you can to protect yourselves and your circle of family and friends and hope that you are not found wanting. That is really all we can do. If you have the means to support others, then by all means do it!

As far as using your gold and silver for protection, I would just advise you not to forget to tithe Uncle Sam his most unfavorable 28% collectable rate of tax for capital gains on metals! Ugggggh! Perhaps when the "SHTF", they will increase this tax, to help ease the burden of the governments liabilies and to help protect us? (If any of you saw the snippet on the findings of the 9/11 Commission on History Channel or actually read the book, then you know what i am talking about.) Or, if we have to actually cash in our gold and silver insurance policies, maybe things will be so bad that there won't be any taxes at all. Now there is snafucon if ever there was one! In any case, Peace and Blessings to all, and to all a goodnight.

Viva Liberty!


mas@GoldPuppy#1414212/7/06; 05:54:31

It's in their best interest to keep the gold price down, keeps USD up. This has been studied by all here, more than a million times. So not sure where your coming from? They are right now trying to keep the price down, but it's just not working any more. Everyone outside the system is moving their money to other reserves, (Euro, Gold, Silver, or whatever except USD). Best you get out of debt (now) and have gold/silver in your hand. Paper is just that, paper.
Good luck.

Freedom... the Plunge Protection Team#1414222/7/06; 06:07:10

Hello Goldpuppy,

You ask what other people think. In my humble opinion (IMHO) I think this run up in gold is not based on a "Gold Market" and gold traders. I believe there are millions of common people who have decided to purchase and take possession of gold. The situation in the world has us "uneasy" and we have decided to find a way to eat; once that "predicted future that makes us uneasy" arrives. I'm sure the powers that be (PTB) have tried and tried to drive the price down already ~ but the real buyers are grabbing up the gold on any downturn. I believe the future of gold has already been taken out of the hands of those who believe they can control the price.

">>Michael Bolser and the Plunge Protection Team
He reckons that the Feds have had many years of thinking and planning for this moment and have mapped out a plan to deliberately let gold price keep rising, luring more people in, then plunging the price of gold to scare away the gold investors again as they did many times before. What do people think?<<"

Knallgoldplunge#1414232/7/06; 06:40:37

We seem to have a new "funny" poster here-right on cue NY smashes POG down at the opening.In light of the Credit Agricole report its worth noting.

What if the strategy is to make it too obvious?

mikalDollar declines vs yen#1414242/7/06; 06:40:40

Dollar Falls Against Yen as Japan Monetary Shift Seen - AFX - 2/06/06
mikalDikes leaking on several fronts#1414252/7/06; 07:12:31

Yen Rallies Ahead of US Bond Auctions - 2/06/06
U.S.$ shaped by BOJ policy, this week's massive bond auctions, next week's coupons, gold, oil, more

mikalDate corrections#1414262/7/06; 07:14:59

Two articles below are 2/07/06 dated.
TownCrierA paper phenomenon#1414272/7/06; 08:19:54

Given that the mechanism for price discovery in the gold market occurs at the margin of reality within the ethereal sphere of paper gold (gold derivatives), when you see a sudden price dip like today's, especially when it coincides with trading hours during NY's market in gold futures contracts, you really have to pause and wonder who the clowns are that have put their faith and their money into those derivatized instruments of psuedo-gold, and more particularly, does this aggressive selling of those papery instruments represent a sudden collective epiphany and attempt at exodus among the participants in that market?

As a metal accumulator, at an opportune time like this one can only hope that the papergold market prices do indeed continue to exert pricing influence upon the metal market such that this bargain can be enjoyed upon purchases of the superior product -- the metal.

In extremis, the one thing you can be sure of is this -- if the market for gold derivatives falls into disorder on a crisis of confidence, and plunges into the depths of no bids or defaults and frozen trade, the market in metal (as reflected in its price) will suddenly and very obviously be seen to be standing (jumping) on its own independent legs.

Don't settle for papergold when you can have the superior asset that it tries (and ultimately fails) to emulate. Choose yellow metal. Its the only asset that's truly as good as gold -- because it is.

Call USAGOLD-Centennial today for price quotes and consultation on a diversification strategy that's right for you and your investment goals.


Gandalf the WhiteWOWSERS !! -- NOW, I have seen EVERYTHING ! <;-)#1414282/7/06; 10:03:56

I never thought that I would live to see the POG and the DOW going in opposite directions at the 14 Plus and Minus levels ! Toto, we are not in Kansas anymore !
This confirms to me that Sir Smeagol is oh sooooo correct, when he admonishes all to "keep the PRECIOUS tightly held" !
I am going to get "offline" now, so that I may call USAGOLD and get more YELLOW at this "GIFT PRICE" today !

TownCrierOne-day and longer term gold price charts#1414292/7/06; 10:10:56

Take a look at these historic charts as a good perspective builder.

Spikes down (and up) are nothing we haven't already seen a hundred other times in gold's pricing evolution to fundamentally higher ground.



FlatlinerOn days like today#1414302/7/06; 10:41:26

It's worth reading the archives. Message ID#60253 talks about how the CBs built the paper gold market and message ID#60253 talks about the trump card Oil plays in the revaluation of gold.

It seems that all the conditions that existed years ago still exist. The only real difference is that more people are starting to see the deception and they are gravitating towards gold. Hopefully, not towards paper gold.

SmeagolWe were wondering...#1414312/7/06; 10:45:39

...when the sseasonal weakness would kick in... and combined with the usual shenanigans, the percentage change of the price as compared to when it was half of today's... we doesn't think thiss is all that unusual.

sss...but it does mean "buying opportunity!


SmeagolAmusement Park Warning#1414322/7/06; 11:13:37

"WARNING/CAUTION: This ride travels at high speeds and exerts significant forces including negative G. Some people may experience vertigo or motion sickness. Please keep both hands on the gold restraining bar at all times. Thank you and enjoy the ride!"



FlatlinerJust watching#1414332/7/06; 11:26:58

NYMEx Issues for February.

Silver 199 (up from 122) or 995,000 ounces (up from 610,000).
Gold 5,664 (up from 5,550) or 566,400 ounces (up from 555,000)

Total Eligible in golden warehouse is shown to have not changed from yesterday.

SurvivorOK, Is Somebody Draining The Moat?#1414342/7/06; 12:21:57

Strange day. Some strong undercurrents right now methinks. Gold and Silver down big time (but not very significant in the overall picture). Most stock markets on the planet are down. US Dollar, Oil down. Upside-down bond curve with a dip you could park a truck in.

Can the sale of a few treasuries be this big a deal? Do moat monsters sweat? Did I notice a shudder?

Sir Smeagol's warning is well placed. Please stay seated and enjoy the show.


monTROZLet's have a fine welcome for Chairman Ben.#1414352/7/06; 12:32:03

New Chairman = slam gold. Duh!

Today, the new fed chairman makes his first move!!
"Let's see how far down we can push this little problem we have. Hmmm. -$20.00 seems about right."
Later that same day, "What only -$19.50, ha ha ha, we'll just have to do better tomorrow".

After the fact it seems sooo predictable.
Next they'll raise the margin rates again, due to the volatility of course. Then the traders will push on to the 200 day average, "because it's there". Sigh.
Patiently waiting to convert paper into gold.

Still waiting…

OvSWhy in a bull market one must sit tight with physical silver (for example).#1414362/7/06; 12:38:34

If one still believes in the
bull-market of precious metals,
one must ride out these spikes
Today there was a 40 cent decline.
That's a pretty hefty one indeed.
Should one sell with the idea of
buying it back later?
Silver would have to decline 250
cents before one could buy it back
for the same price that it was
sold (bid and ask differential).
That's before the shipping and
handling charge and insurance.
Therefore, dear knights:
Sit tight and enjoy the sights.
When one exits silver, it must
be for good; especially on that
big spike coming up, sooner or
a bit later? First, down a little,
and then Up and Away. Cheers. OvS

melda laurePerhaps the Yukon variety- big and yellow#1414372/7/06; 13:06:21


What will they win, do you think, when i heri numen return and find things amiss? Nothing passes here that is unseen there.

Be that as it may, gold is but one thread in the tale of the future- if one will read between the lines of J Mauldin's "bulls eye" book, the production of energy will change and so will the techhnology of medicine. But first we must pass the test of childhood's end.

Can one blame him for puttering around with herbs and taters in these days? It will pass in time, and the taters will sprout- whatever the weather.

slingshotGreat Day to be a Goldbug#1414382/7/06; 13:10:45

Mama told me there would be days like this!


968Forex reserves should be cut by half: Chinese banker#1414392/7/06; 13:48:58

"China's foreign exchange reserves should roughly be kept at a level between US$300 billion and US$400 billion, which will be appropriate," the Financial News quoted Wang Yuanlong, a director at Bank of China's Australian operations and former economist at the bank, as saying.

China's reserves, which will soon surpass those of Japan as the world's highest, are enough to repay its entire foreign debt and still buy 10 months' worth of imports.
Isn't it strange that a country can have too much reserves ???

TownCrierNo margin calls on the GOOD stuff...#1414402/7/06; 14:09:46

real1Violent market forces at work#1414412/7/06; 14:31:03

It was a violent correction for precious metals and their mining shares. Gold broke down of a head and shoulders pattern and the downtrend was pretty consistent all day long, Silver found support at the 9.30 $ level. Gold is already 28$ lower from its most recent top and the correction is already somewhat extended in my opinion. Nothing goes straight up and violent & volatile market should be expected, physical holders need not worry at all while future traders should be very careful!
I have annotated one and four hours charts for gold spot. Click on link to see the charts



"Free markets for Free men" is the battle cry for traders on Chicago's Futures markets. But if one wants to place a bearish bet on the direction of Japan's financial markets, be prepared to do battle with Tokyo's Ministry of Finance. And for traders in the Nikkei-225, Japanese yen, and Japanese government bond market (JGB's), it just seems like deja-vu all over again.

Meddling in the local bond, stock and currency markets is a time honored tradition at the Japanese Ministry of Finance. In its most brazen form, former MOF chief Masajuro Shiokawa drew up plans in February 2002, for his ministry to buy 2 trillion yen of stocks directly from banks, and asked that the Bank of Japan to increase its monthly bond purchases by a quarter, to 1 trillion yen. Then, a few weeks later the MOF authorized several buying forays into the Nikkei futures market ahead of the Japanese fiscal year end on March 31st, 2002.

By purchasing large amounts of Nikkei futures contracts before the fiscal year end, Shiokawa put the squeeze on market bears in order to help improve the balance sheets of besieged Japanese banks. Then the Financial Services Agency, the government's top financial watchdog, penalized four foreign brokers, Credit Lyonnais, Bear Stearns, Deutsche Securities and Nikko Salomon Smith Barney for violating regulations on short-selling."

Druid: An excellent read concerning, among other mysteries, the latest action in the Yen and Nikkei-225.

SurvivorWill Feb. 7 Be A Day We Mark As A Milestone?#1414432/7/06; 15:22:31

Quite a day when viewed at the neighboring castle (which we view only for educational purposes!).

With the exception of 30 day and one year gold, **every single entry** has a down arrow or negative sign: ALL of the currencies; ALL of the commodities; ALL of the indices!

I realize this is to some extent a statistical anomaly, but it is a first for me after many years as a market-following data junkie.

In any case, my seatbelt is firmly anchored in Physical, so its just good entertainment viewed from a secure position.

- Survivor

Federal_ReservesThe Road to Bankruptcy.#1414442/7/06; 15:55:27

U.S.'s Snow says need debt ceiling rise soon
Tue Feb 7, 2006 10:22 AM ET

WASHINGTON, Feb 7 (Reuters) - Treasury Secretary John Snow on Tuesday said the government's debt limit
should be raised by mid-February and the Treasury's ability to meet debt obligations would be "exhausted"
by mid-March if it was not raised.

"The letter I sent in December to the Congress indicated that we will need to raise it by mid-February,"
Snow said in response to questions before the Senate Finance Committee.

Asked how long the Treasury could meet the country's debt obligations in the absence of a debt-limit
rise, using a variety of extraordinary means, Snow said that it could do so until mid-March.

"The administration now projects that the statutory debt limit, currently $8.184 trillion, will be
reached in mid-February 2006," Snow said in a letter to Congress in December.

The debt limit was last raised in November 2004 by $800 billion to its current level. Treasury did not
specify in December the amount by which it wanted the debt ceiling raised.

The Treasury asks and the Congress rubber stamps? Or is it different this time? With the huge fiscal and trade deficits maybe it will not go so smoothly this time? Is someone going to act like an adult and say "NO MAS" to all this excess? Maybe someone will ask why were aren't asking those with the largest ability to pay, to come up with a little tax sacrifice especially considering we are in war time......

Better get Mr. Snow, I show you already over the limit, well before the MID FEB date you project.

The Debt To the Penny
Current Amount
02/06/2006 $8,197,590,334,157.11

Remember, any sign that sanity and balanced fiscal and trade polices are returning would be bad for gold.

USAGOLD Daily Market ReportPage Update!#1414452/7/06; 15:58:38">
The Daily Gold Market Report has been updated.

If you are considering investments in gold we invite you to">request our free introductory information packet detailing the products and services offered by USAGOLD ~ Centennial Precious Metals. We welcome your inquiry and look forward to working with you.

TUESDAY Market Excerpts

February 7 (from MarketWatch) -- The April gold futures contract marked its biggest one-day drop on record, losing $20 Tuesday to close at the lowest level in three weeks. It closed at $554.80, down $19.50.

Prices for April gold may fall to the 50-day moving average of $537.40, said Dale Doelling, chief market technician at Trends In Commodities. But that the level offers "very strong chart support" and "the overall market trends remain intact," he said, with a fall to the chart support level taking the market back to "oversold territory."

That, in turn, would likely set up "the next leg that would finally see gold testing that $600 resistance level," he said.

Gold prices closed almost $3 an ounce higher on Monday as a United Nations agency's decision to refer Iran to the Security Council over its nuclear program prompted investors to take a defensive posture. The International Atomic Energy Agency voted over the weekend to refer the Tehran government to the Security Council, citing an "absence of confidence" that Iran's recently resumed nuclear program is aimed at peaceful civilian-energy generation.

"The uncertainty surrounding the situation with Iran and their nuclear program has brought an added degree of volatility into the gold market," said Emanuel Balarie, senior market strategist at Wisdom Financial.

This period of consolidation is "ultimately good for the long-term movement of gold," he said. The fact that "gold has remained near its highs in the midst of profit taking is a testament to the strength of this bull market."

Indeed, "There is huge demand out there at the lower levels still, with the funds holding, but prepared to sell on the fall -- that's what consolidation is about," said Julian Phillips, an analyst at online resource GoldForecaster.

"The resolution of these pressures can only make a market healthy."

Overall, "the fundamentals are still favoring a continued move on the upside," Balarie said.

(from Reuters) -- Matthew Turner, analyst at Virtual Metals, said gold prices had risen more than $100 an ounce in the past three months and a correction at some stage was inevitable.

But analysts said gold would rise again to hit new highs. "Much of gold's recent rally has been supported by positive investor sentiment in light of rising oil prices, inflation concerns and geopolitical volatility, and we do not expect these supportive macro-factors to dissipate in the near term," Barclays Capital said in a report.

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

TownCrierDGCX completes first gold futures contract#1414462/7/06; 16:12:05

02/08/2006 Dubai: The Dubai Gold and Commodities Exchange (DGCX) delivered all of its gold orders at the expiry of its first futures contract.

A total of 29 kg was shipped to customers in 1-kg bars. The gold was delivered via the Dubai Gold Receipt (DGR) system.

Framroze Pochara, Chief Executive Officer said: "This is one more milestone for the exchange which has been in business for just over two months. Successful completion of the contract symbolises trust and commitment of DGCX members."

Colin Griffith, Chairman of DGCX said that the DGR system developed proved to be a catalyst by creating a platform for gold traders and financiers to run their businesses.

Griffiths added that the contracts traded and the volume of deliveries through DGCX will continue to rise in the near future as more members participate in the process.

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

Starting small, like a sprouting seed.


David Linkley"Unreal" markets#1414472/7/06; 16:59:29

Sure, today millions of informed independent investors woke up and decided to sell gold, oil and any other hard asset they could find. "Helicopter" Ben Bernanke had nothing to do with it or the mindblowing short positions of the COT. This is mearly exhibit #1 of why the Federal Reserve's very existence is totally immoral. I predict at the end of the crises period we're entering into the Fed will be blamed and disbanded. The average fiat money scheme lasts for about 100 years and 2013-2014 sounds about right for the dollar's demise unless a severe restructuring of the US occurs.

This may be a rather severe correction as the Western Central Banks and the COT look terribly silly at present. They are getting their asses totally kicked around the block. As Belgian pointed out so eloquently the entire US -IMF currency system is under seige and they are fighting back.

Buy the dips and hang on, nothing has changed except that Bush is sinking deeper into the muck by the day. Snow, Bernanke and the rest of the administration are pawns in a game decided long ago when gold was excluded from the current monetary order.

In fact today is almost comical when you think about it. The desperation of these people is so heavy you can feel it in the air. Rest easy and know that another gift has been bestowed upon you today.

David LinkleyBernanke#1414482/7/06; 17:13:22

IMO Bernanke will prove to be an intellectual lightweight following today's episode. Pound gold, raise rates, prop the dollar and the yen then print like hell to get Bush and the Republicans through the mid-term elections. Good luck Ben! Your political front running for Bush will plunge the dollar down and leave you with a short and massive failure to the end of your bogus career.
MKMr. Linkley#1414502/7/06; 17:30:21

Interesting that you bring up Helicopter Ben. Woke up this morning, went to the computer and saw gold was down $12. Went out the front door, picked up the Financial Times, opened it and saw a picture of Ben Bernanke being sworn in as Fed chairman. Tried not to put two and two together, but the sequence was so tight I knew it had to happen for a reason.

Today we had gold down hard and oil down with it. We had the yen up and the Dow down slightly with the rest of the stock market eroding at a much faster rate underneath it (S&P down 10+). So if market management and A MESSAGE were the order of the day, this certainly does look like the Wall Street wish list in a microcosm.

But what if the real message is hidden in the day's bombast. What if the real market reaction manifested itself in the S&P and all the other market reactions were half-hearted attemptes to help inaugurate the Bernanke stewardship on the right note? The day's actions were so odd as to make one wonder where the impetus came from.

We'll know more as the week progresses. We had a very big day at CPM today. I suspect we'll have another one tomorrow after today's events are fully digested. Not a single trend that was in place yesterday, turned around today. As you so eloquently put it, are we to believe that millions of gold investors around the world suddenly dumped their gold? I don't think so.

As a matter of fact, the situation with Iran only grows worse and the complications proceeding from reciprocal boycotts could develop catastrophically for both the West and the Gulf -- and I am not attempting to exaggerate.

So I would encourage the paper-hangers to have fun while they can. We'll keep taking down the physical and we'll see who comes out on top when its all over.

balzacPRICE DROP#1414512/7/06; 17:42:52

We have been thru this many times before since '95 don't
let it phase you , remember $252. The US$ is falling.
That is all you need to know.


DruidToday's gold action...#1414522/7/06; 18:15:00

Druid:...doesn't suggest to me that the Chopper might have been behind this one. All markets with very few exceptions were down, this would suggest, a deflationary picture of sorts crying out for more "liquidity". If the price of gold would have been bombed by itself, then I could buy off on the Chopper sending us a message that there's a new Sheriff in town manning the ship toward the nearest reef.
SundeckVive la America...Long live Francaise#1414532/7/06; 18:47:37

While it is tempting to link the solid "price" correction in gold to particular recent events, such as:

- Credit Agricole report

- "Choppa" Ben's accension

- 30-year bond "come-back fight"

- Iran

- etc,

...before getting too wound around the axle over one or t'other, it is worth noting that the "correction" of a few percent in the price of gold has also been accompanied by a "correction" in the prices of a whole lot of other things...copper, zinc, lead, silver, etc, ... all more-or-less coincident with the down-draft in price-of-gold.

The Reuters/CRB index is also down over the last coupla days (as one might expect)...

Gold has had a pretty rapid run-up over the last month or two...but then so have things like zinc and lead. I don't see anything that would set the POG apart from the typical behaviour in the price of any so-called "growth stock", say. Sudden corrections are not uncommon in them, as in love and life and everything...

Has anyting changed in the fundamentals of the firmament? Has the Earth started wobbling uncontrollably on its axis? Has someone invented a magic no-cost filter to extract gold from sea-water? Has Ben's ascension spelled out a splendid (or horrible) new set of options for America, France and rest of The World?

I don't think so. More likely a few bulls have seen that things in general are getting pretty pricey after a good run-up; a few of them have shifted their weight onto the other side and...ROAR...the herd is off...this time going down-hill...

Not to worry...they'll cool down, look around for a while, commence grazing again and then start asking themselves: "What the Hell was that all about?" Then it will be back to business as normal...

As Sir slingshot might say: "Great day to be a gold-bug!"

...but, please do your own due-dilligence...


ThoreaulyIraq's WMDs#1414542/7/06; 19:02:50

Let's say they actually are, or are at least strongly believed to be, in Syria. Won't Bush & Co. use this as the the "last straw" for invading Syria along with Iran, assuming the latter opens its oil bourse in March and continues to play tough on the nuclear front?
David LinkleyUS Attack#1414552/7/06; 19:57:21

A top Russian Parliamentary Leader Vladimer Zhirinovsky has told a radio station (Ekho Moskvy) the US will attack Iran on March 28th. Another reason our fearless leaders went after gold and oil today. The black box spec hedge funds must be puking their guts out tonight. Why would anyone sell their gold during times like this?
Chris PowellGreenspan blames terror threat for high gold price#1414562/7/06; 20:32:54,,13132-2029794,00.html

By Leo Lewis
The Times Online, London
Wednesday, February 8, 2006

TOKYO -- Alan Greenspan, who stepped down last week as chairman of the US Federal Reserve after 18½ years, yesterday blamed the threat of terrorism for the soaring gold price, in his first private-sector speech since being let off the leash of officialdom.

According to members of his audience of international investors -- watching a holographic image in Tokyo as he spoke in New York -- Mr Greenspan said that the high cost of gold did not reflect inflation or the strength of commodities but rather a fear among investors of a major geopolitical conflict.

There were people who believed that a nuclear weapon could be detonated within five years, the American central bank supremo said.

The low probability of such an event occurring would not necessarily avert a spike in the gold price, he added.

Dr Greenspan went on to discuss a range of topics, including the problems created by a lack of investment in refining capacity by the oil industry. He said that this failure by the oil majors meant that the era of cheap energy was almost surely over.

The former Fed chairman is also said to have indulged in a moment of self-criticism over the central bank's failure to prevent the market bubble in the late 1990s.

He admitted that, at the time, he and his colleagues could not see that the notion that they could diffuse a bubble with incremental rises in rates was an illusion.

Dr Greenspan's decision to appear in public so soon after stepping down clearly demonstrates that the revered figure in central banking is not one to revel in retirement, after almost two decades at the Fed. The 79-year-old is believed to have earned $120,000 (£69,000) from his one-hour speaking engagement.

He revealed that on his first day of retirement last week he told his wife how strange it was to wake up and not worry about what had happened on the Tokyo market the night before.

The question of where Dr Greenspan would deliver his first public speech since retirement had been the subject of fierce debate and intense commercial rivalry. Numerous Wall Street investment banks, including Goldman Sachs, Morgan Stanley, and Citigroup, are understood to have offered to pay him large sums for his time, but they were beaten by CLSA, an aggressive securities firm based in Asia that runs an annual forum on Japan for investors.

Two years ago Bill Clinton, the former US president, gave the opening speech at the forum -- also via hologram -- for which he was paid $200,000.

From the comfort of an apartment in New York, Dr Greenspan fielded questions from investors at the forum and offered some cheer by declaring that, after years in the wilderness, Japan had become a normal economy again.

guns'n'butter$Gold=$Oil#1414572/7/06; 20:46:08

Today $gold broke through two lower support levels.......
first $563
then $555
it seems "another" spin is also in play.
oil/petrol "supplies" were reported "substantial" in the US.
perhaps the powers to be want to intervene in the lock-step $gold/$oil momentum.
the oil "premium" on gold is about to go pop after this futile intervention.
soon gold will flex it's muscles again as the demand for physical will outpace the paperboys.
i welcome the shake-out!
this is a buy signal folks.

PRITCHOComment on Barrick from Richard Russells Latest Remarks #1414582/7/06; 21:09:15

February 7, 2006

An e-mail received yesterday --
Further to your Feb 2 comments on the hedge position of Barrick Gold, I have checked their financial statements for the period ended Sept 30, 2005 and buried in the notes to the statements they admit the following:

They have forward sold 12.9 million ounces of Gold at fixed prices and at Sept 30th "marking these short positions to market" provided them with unrealized accounting losses of $2.19 billion US Dollars.

It will be interesting indeed to see the financial statements for the period ended Dec 31, 2005. The unrealized accounting damage, I expect, will be severe.

Malcolm Bucholtz B,Sc,MBA

Investment Advisor

Union Securities – CANADA

Russell Comment -- Wow!

YGMPritcho,,,Barrick & It's Hedge Book of 12 M Oz.#1414592/8/06; 00:25:53

Nice to see gold "experts" like Russell and writer Malcolm Bucholtz finally "get it" regarding Barrick & their Hedge Book 6 years after the fact. Just like so many other "expert's" w/ regards to most aspects of GATA's long term information war. GATA's Murphy, Reg Howe, novelist Arthur Hailey and many others "got it" way back in 1999 when we exposed Barricks (then) Hedge Book of over 14 M oz's. There were innumerable GATA posts at GATA's Yahoo message board in 1999 exposing Barrick for what it was and still is, and the posts have never stopped. A few hundred to be exact. But then who but an open minded and observant few were even paying attention back then. Still with all the well known converts to the GATA camp over the years and recently many more once so vociferously and stridently opposed (the self proclaimed Gold experts and advocates) to our views, having now seen the light and the results of this 6 year information war exposed, there are still those with their heads in the sand and bleating feeble disdain & vitriolic commentary towards GATA. Best experience I've withnessed in 6 years of GATA involvement was the standing, cheering ovation Bill & Chris recieved on the podium in front of a packed to capacity hall in Vancouver last month after the premiere of the Goldrush 21 DVD. The Gold Anti Trust Action will be spoken of in history books in future and if that is not yet realized, it will be. A shining example of dedication, fight and standing for one's beliefs by a very few, thru years of belittlement and spiteful critique. They ALL have MY hard earned respect. Ken Reser (YGM)
Jacob MarleyCP and Greenspan@141456#1414612/8/06; 00:52:22

Greenspan is no sage. He's a lackey who's only concerned with who's buttering his slice of bread, and boy are they slathering it on. If G, in "indulging" in a "moment of self-criticism," admits that the Fed and all the hundreds of economists, and billions of dollars of resources at their disposal, "could not see that the notion that they could diffuse a bubble with incremental rises in rates was an illusion," then what credibility does he have when he mouths silly blah-blah about gold price spiking having to do with fears of the catch-all bogeyman "terrorism" or some other indiscreet geopolitical belch?

Why should we believe this anymore than the other? It really is a sorry thing when an elder banker, who should now have prestige, and whose words should carry the weight of trial and experience, chooses to give it all away within a week of leaving his post, by opting to obsequiously lick clean the boots, underside and all, of the anti-gold (pro-dollar) faction that made him, and with those very boots would crush him like a cockroach, if he dared to speak what surely he knows to be right. G is not stupid, but now that G is not under the constraints of official capacity to speak carefully, he has just shown us what manner of man he really is.

KnallgoldWelcome back Jacob Marley#1414622/8/06; 01:09:48

It seems mentioning your name yesterday brought you out...
Any updates on the trail from your side?

SundeckGreenspan's "high gold price" and the US-dollar "standard"#1414632/8/06; 04:54:58

Ref #141456 ...

When is a standard not a standard?

For years the standard "metre" was a polished alloy rod kept in vacuum at constant temperature in it is probably defined in wavelengths of monochromatic laser light...accurate and stable and fixed to perhaps one part in ten to the ten, give or take a few orders of magnitude.

What about the Ohm...the unit of electrical resistance? It is now defined in terms of the "Klitzing" as a result of that Nobel laureate's pioneering work on two-dimensional quantum effcts...defined to a precision of, I don't know, perhaps about one part in ten to the fourteen, say...maybe better.

What about precise scientific theories (models of physical behaviour). The prize goes to quantum electrodynamics (the behaviour of the electron). Fifteen years ago it was verified to one part in ten to the seventeen...probably better than that now by two orders of magnitude. That is comparable to determining if a grain of sand is missing from all the beaches between Boston, Mas., and Freeport, Maine!

...and then we have "The Dollar"... Man, that's some standard. Measured in terms of housing, it has about 2% of the purchasing power that it had in 1970. Measured in terms of gold it has about 7% of its purchasing power in 1970.

And yet people are apt to talk in terms of "the high price of this-or-that" as if the dollar "measuring-stick" is invarient through all time and across all space, and something must therefor be amiss with the pricing of this-and-that. What really should be said is the "low value of the dollar in terms of this-and-that". That is, the dollar is NOT a standard, never was and never will be.

The "high price" of gold has about as much to do with "terrorism" as the outcome of one of my baking efforts.

On the other hand the price of gold has everything to do with the "non-standard dollar"...the outcome of Mr Greenspan's "baking efforts"...


PRITCHO@ Frozen Miner :) - - - - #1414642/8/06; 05:26:06

Yes it's true - -I'm a fan of Richard Russell & it is great to see him pass on an up to date Financial analyst's comments about Barrick.

You must be proud to be a ra,ra, foot stomping ,hand clapping fan of Murphy & his editor Chris --good on you thats your democratic right.It's more than a bit boring though, regurgitating what Chris Powell spent acres of ink on yesterday.If you must focus on anything give me the reason why GATA sucks up to the likes of come lately Peter Grandich? Grandich has only lately found favour with GOLD & has also just as quickly tried to call a top.Not a squeak from GATA -- You've GATA wonder why.At least Russell's been keen on GOLD for his whole career.

You're not the ONLY one who's been supportive of GATA & more importantly it's message.I've been involved also for at least as long & have been an activist in my own right here in Auss.I'm sure a lot here at USA GOLD also have been involved with spreading the message.Personally I don't believe in hero worship --especially when I don't see a specific hero.

Hope you can give it a rest on this subject - there was never really any need for you to stick an oar in the water anyway. My main concern is getting others to realise that Gold is a Political Metal & that the PTB will do anything to keep the POG contained. It's great to have help in spreading that message.

Chris PowellThe difference between Richard Russell and Peter Grandich#1414652/8/06; 06:52:53

Pritcho, from GATA's standpoint there's a huge
difference between Richard Russell and Peter

Russell has been approached and impleaded
by GATA and its supporters for years, and has
ignored us throughout.

By contrast, Grandich came over to our side
on his own in the last year and has done much
to publicize GATA's work, in his newsletter,
on television in Canada, and at conferences.

Russell has brought himself to mention GATA's
work only recently and only under the cover of
the big investment bank, Credit Agricole /
Cheuvreux, and even then he could not bring
himself to express his own view on GATA's

That is, Grandich risked his reputation while
Russell still won't. And as YGM notes, Russell
seems to think that Barrick's under-water hedge
book is news. How much more behind the gold
issue could the great man be?

OvSPrimus 1#1414662/8/06; 07:26:47

Self-promotion. Also,
your message is for
traders. Good-Bye.

DruidJacob Marley (2/8/06; 00:52:22MT - msg#: 141461)#1414672/8/06; 07:28:54

Druid: Great to have you back JM, yeah, Greenspan is preaching to a particular choir and foregoing his ethics and integrity. I'm certainly not surprised.
YGMPritcho#1414682/8/06; 07:41:05

excuse me but you're the one who needs to give it a rest w/ all your constant back handed & bald faced rude remarks about gata et al. I simply made two posts on the topic and am entitled to do so. Who died and made you the gata expert or sherriff of the forum. I have read Russell for years also so he's not your private commentator and you seem to think you have a monopoly on his defense and that of childish name calling regarding those involved with gata. I'll say what I want when I want with no regard for the likes of you or anyone else who cannot carry on a civil debate if they have issues orcontrary opinions. My 15 year old could out debate you with more class. Carry on with your childish name calling now.
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Goldilox"History Books"#1414712/8/06; 09:54:32

@ YGM,

"The Gold Anti Trust Action will be spoken of in history books in future and if that is not yet realized, it will be. A shining example of dedication, fight and standing for one's beliefs by a very few, thru years of belittlement and spiteful critique."

While certainly deserving, it is incredibly naive to believe that "mainstream history books" will mention GATA at all. I still have yet to see a "mainstream history book" that outlines the underhanded collusion in Roosevelt's gold confiscation, the real origins of the FED, the real Lusitania event, or the truth about Pearl Harbor. Most don't even mention that PH was in response to the oil embargo imposed upon Japan, citing it as an unexpected, unprovoked attack.

Remember the "Iran hostage crisis"? In order to whip up the war fever, TPTB are now telling people that they froze $Billions of Iranian government money in reponse to that event, reversing the "historical order". The banks froze that money for the deposed Shah, and the US consulate staff were being detained until the funds were unfrozen and returned, most of which remains on the smiling banksters' books.

Given the number of anti-establishment purges from history in the last century, GATA certainly qualifies with the likes of Nicola Tesla, Wilhelm Reich, Sibel Edmonds, Catherine Austin-Fitts, Jim McCanney, Frank Zappa, John Lennon, Charlie Chaplin, and many, many others who have disputed the mainstream "story" and found themselves "blackballed" from history or worse.

Those who write the "mainstream history books," like the "mainstream science books," are every bit as master-serving as Greenspan is showing himself to be, with all dissenters duly labeled as "Kooks and Conspiracy Nuts".

See the attached URL for a more complete description of the "process".

YGMGoldilox#1414722/8/06; 10:11:26

Thanks for the link..Yes I'm sure I used the word "History" books a little to loosely. I would expect that "type" of history to be written by the likes of Ravi Batra etc or the recently departed Ferdinand Lips. The GATA experience may not have been perfect (what or who is?) but nonetheless it has been the most outspoken & effective advocate Gold ever had IMHO...YGM
Black BladeInelastic Gold Supply#1414732/8/06; 10:20:51

Inelastic Gold Supply


This article attempts to establish the notion that as the gold price rises, the mine production industry will not bring significantly more gold to market. In addition to other obstacles, they will be stymied by hedge book losses, sure to drain valuable funds. They will face large obstacles from rising costs, such as for energy and construction materials. They must overcome labor shortages. In the year 2005, the gold industry has produced a mere 2% more gold than the previous year. The reasons for the shortfall in what might be expected in mine output are many. Abusive hedge practices are one reason in my opinion for the shortfall. More difficult mine venture projects is another. The conclusion is that a much much higher gold price will be required to encourage sufficient supply in order to meet demand and avert shortages. The prospect might spell greater profit for leveraged physical gold and silver investors than stock holders. However, the unhedged mining firms will see staggering gains in their stock price.



Barrick Gold hedge book losses have begun now to be quantified. Don't expect setbacks are over for either this firm or other hedge device abusers. Barrick was once accused of being a financial firm masquerading as a gold miner, for the unexpressed purpose of selling forward gold contracts far in excess of actual production. Its entire existence is an anomaly, most likely from its inception being a corporate illicit hedge apparatus, a gold cartel tool. Their senior management hailed from financial firms, not mining firms, and surely not of geologist background. Their central unstated non-chartered modus operandi was founded in neglect of their mine operations, sure to exacerbate their future (like now) gold output. Their reported 13 million gold ounce short position vastly eclipses any future production schedule, an outpouring of acid on their balance sheet of as much as $560 million lost in a single recent quarter. To put that quantity into perspective, 13 million oz short position exceeds all gold exchange traded fund (ETF) holdings. In the past six quarters, try imaging the harsh reality of a $1000 million loss for Barrick.

Anyone who cannot conclude that their acquisition of Placer Dome was motivated by a desire to blend acid with some valid production and cash (alkaloid) is naïve at best or blind at worst. Their combined short position is 21 million oz gold. To date, a $3 billion loss on the Barrick books is staggering, but that amount is likely less than half of the sum necessary to close out their "ingenious" hedge book. Again, perspective is needed. Such a cumulative loss over the years offsets the entire profit generated by Barrick from its ill-designed inception. One can serve up Barrick in an MBA business school program as the quintessential hedge disaster in all of history. My view is that at least one mining firm, and very probably Barrick, will blow up in the next derivative disaster with full publicity and notoriety. My conjecture is that Fanny Mae already blew up, but its publicity has been smothered in secrecy under the aegis of the US Federal Reserve. My other evil conjecture is that the USFed is illicitly transforming Fanny Mae mortgage backed bonds into US Treasury Bonds. Does anyone watch? Does anyone care? Does the law even apply? Are laws relevant to the game anyway?

Finally, the point to be gained from this line of thought is that Barrick, like some other gold miners, has been forced to exhaust its precious cash position. They have therefore denied themselves needed funds for mining operations, to satisfy their charter for gold production (seemingly a nuisance), in order to secure current precious metal output. They aint producing anywhere near as much gold, silver, and other byproduct metals due to their greed, stupidity, arrogance, and fractured fallacious phony business plan. The irony is that first, miners are buyers of gold contracts in a very very big way. Second, as the gold price rises, they might actually produce LESS GOLD. They are being bled dry of cash. A mining stock investor must lick chops, salivate, and find glee in their highly deserved misery. Overly hedged gold miners actually produce less with higher prices.

Black Blade: This is a good article and I can't do it justice with only a couple of snippits here. The author really outlines the difficulties ahead for one of the more notorious mega-hedgers. Other elements of the piece are interesting as well.

The action yesterday in the precious metals was rather amusing for those of us in the metals market. Hedge funds exited en masse in a wild bear raid scalping gains from quickly built up metals short positions. Obviously nothing had really changed as far as the fundamentals are concerned, but the run was somewhat entertaining and amusing as the sudden price drop afforded yet another opportunity to buy the undervalued asset. No undervalued investment or hard asset goes straight up in price but is always punctuated by temporary pullbacks (corrections?) as it seeks its true value. Yesterday was really no different. Now that the weak hands have been shaken out its "back to business".

GoldiloxWeak Hands#1414742/8/06; 10:34:40


Great post! So many illicit activities are coming to light on the financial and geopolitical fronts, that they all must compete for any coverage at all, especially from the "Bought and Paid-for" News.

When you describe the "weak hands" getting washed out, I think of those who ignore Sinclair's warning about "avoiding margin on all things gold".

While yesterday's concerted attack was powerful, it was not nearly as painful to those who own the stocks outright, and especially those who own "gold-in-hand".

OvSYGM#1414752/8/06; 11:03:15

I think you are an old salt
Yucan Gold Miner and a hell
of a good writer.
But you and Chris take Guru
Russell's silence (inspite
of Gata's constant urgings)
too personal.
The man created himself quite
a following and made many a
good call aside from gold.
To go deadahead against your
own government's secret dealings
is not everyone's cup of tea.
Not everyone is a "wild place
prospector" like you, nor an
Irish x-football player (who,
by the way was physically attacked
under suspicious circumstances),
like Bill Murphy. Don't get me
wrong: I admire both of you very
It is also easier to tell the
truth in Canada where things are
a little more layed back. In the
USA, we have not only Washington
DC but also a sharp clever and a
bit ruthless New York crowd to
deal with. It's no coincidence
that Sinclair, who lives in Conn.
registered his Tanzanian Explora-
tion Co. in Canada.
Now, let me go back to researching
another great catalyst:molybdenum,
which, like gold and silver, has
great promise for nano technology.

TownCrierMini-helicopter action -- Fed buys $1.25 billion in Treasury coupons#1414762/8/06; 11:03:55

The trading desk for the Federal Reserve entered the open market today with an outright purchase of U.S. Treasuries, thus adding $1.25 billion in 'permanent' funds to the nation's money supply with a fresh injection of cash created expressly through the course of this operation.

Paper is easy -- it comes and goes. Gold has universal permanence. Choose the form of your savings wisely.


Chris PowellThe difference between help and timidity#1414772/8/06; 11:31:27

Peter Grandich endorsed and publicized
GATA's work again in his letter, linked

Goldy, I don't take Russell's timidity
personally. He's important to me simply
to show others what the gold cause is
up against. He's a bit like the World
Gold Council. Both know better or are
supposed to and both are considered
advocates for the gold cause but both
do a tiny fraction of what they could
and should do. In his sleep Bill Murphy
does more for the gold cause than
Russell and the WGC do together, for
then he's at least resting up for striking
the blows that Russell and the WGC are
too timid to strike even as their
resources are so much greater.

YGMOvS #1414782/8/06; 12:19:44

I'm thinking you're just another old salt who has been around the Mtn and over the hills a time or two. Judging by your reading research material I can see you still get around :-)
Nano Particle Technology is going to revolutionize a thing or two yes? Happy reading. The urge to learn is a great & wondeful thing, even for us old salty dogs..Ken

YGMInelastic Gold Supply#1414792/8/06; 12:30:13

great commentary by Willie as per usual.
OvSYGM#1414802/8/06; 12:54:43

Darn it, if you didn't
hit the spot. Even us
old salty dogs don't
mind a kind word or
A couple for the road
from good ol' Oscar:
Education is an admir-
able thing, but nothing
that is worth knowing
can be taught.
In life we are all in
the gutter. Some of us
just tend to look up
at the stars.

ShermagGreenspan's reason for gold's strength of late#1414812/8/06; 13:20:27

Snips from the Timesonline article:

"Alan Greenspan, who stepped down last week as chairman of the US Federal Reserve after 18½ years, yesterday blamed the threat of terrorism for the soaring gold price... Mr Greenspan said that the high cost of gold did not reflect inflation or the strength of commodities but rather a fear among investors of a major geopolitical conflict ... nuclear weapon could be detonated within five years..."

No mention of:
- Huge and growing deficit in US balance of payments.
- Huge and growing Federal budget deficit.
- Precaroius balance of supply and demand in oil and natural gas.
- Signs that the US housing market, a pillar of the economy, is turning down.
- The notion that the Fed is now under the control of an avowed inflator (Helicopter Ben).
- Years of outside-of-sustainable growth in US money supply.
- The impending disappearance of a highly watched measure of money supply, M3.
- Massive builds in US dollar reserves in Asian and other CBs.
- Numerous statements from those countries about the desire to diversify out of those US dollars, and specifically moreso into gold.
- Citizens of the US with more debt in relation to income than ever before.
- A quagmire in Iraq.
- A tempest in Iran.
- A dilemna in Palestine.
- Declining mine supply.
- Growing demand from the nouveau affluent in China and India.

It was speculated that they paid him $120,000 for the speech. They should ask for a refund.

mikalGold as a Hedge#1414822/8/06; 14:17:59

Global Markets Not Pricing in Risk: Gold is Hedge - Dr. Gerard Lyons - 02/08/06 Short article with a middle east tone.
USAGOLD Daily Market ReportPage Update!#1414832/8/06; 16:07:22">
The Daily Gold Market Report has been updated.

If you are considering investments in gold we invite you to">request our free introductory information packet detailing the products and services offered by USAGOLD ~ Centennial Precious Metals. We welcome your inquiry and look forward to working with you.

WEDNESDAY Market Excerpts

February 8 (from Reuters) -- Gold steadied above three-week lows on Wednesday, supported by new buying interest from the jewellery industry and investors after tumbling the previous day on a wave of fund selling, analysts said.

The longer-term outlook remained positive and the metal was still seen hitting new highs this year, surpassing last week's 25-year peak of $574.60 an ounce, they said.

"The market needs a correction. It can't just carry on going up," said Jeremy East, global head of precious metals at Commerzbank. "I still think we are going to see higher levels at the end of the year or maybe in the next few months, but at the moment we are seeing some profit-taking and stop-loss selling."

[Action Economics said a sharp yen rally had squeezed out Japanese and other yen-funded margin accounts from long gold positions.]

COMEX benchmark April contracts finished at $553.80, down $1.00, after trading from $556.40 to $548.50. At its 25-year peak, gold was 11 percent higher from the price at the start of this year.

Tensions over Iran's nuclear ambitions, worries about the dollar outlook and firm energy prices had lifted prices on top of an 18 percent gain in 2005.

"I think we will probably see another couple of little tests lower in the next few days, but as a whole the trend is still very firm," said James Moore, analyst at

Some physical buying emerged with a drop in prices as jewellers purchased the metal to refuel their inventories, which had sharply fallen because of cautious buying in the previous weeks, dealers said.

Many dealers in India, the world's largest gold consumer, seized the fall in prices as a good buying opportunity. Demand was good and expected to intensify further, said Indian dealers.

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

TownCrierreal1,#1414852/8/06; 17:16:37

Sorry to delete that post, but thus far your brief posting track record looks highly suspect -- precisely as someone fishing for traffic to feed the advertisers on your blogspot site. That's an abuse of our own host's hospitality, and as such is contrary to the posting guidelines. Please keep it in check.

For more insight into this website/Forum's generous host, see the given url. Let's try harder not to cross them up or otherwise try to make hay at their space and expense, ok?


mikalThe Bernanke era #1414862/8/06; 17:23:03

International Perspective, by Rob Lee
The US Economy and Markets may be heading for a Bernanke 'Trap'
February 8, 2006 - Excerpts -
"...Here is a successor who has promised to follow in Mr Greenspan's footsteps. Indeed he is on record as supporting or contemplating an even more aggressive use of monetary policy in circumstances of crisis. So no problem then. If the economy or markets show signs of turning down, Mr Bernanke can be relied upon to work the same magic, and then some. This seems to be the consensus view, but I think it is wrong. I think that the US economy and markets are heading for a trap..."

Someone was bound to post this gem. Much original and important thinking in this one page effort. He succintly lists many serious challeges ahead including some all too familiar:

"In my view US monetary policy already is tighter than intended or perceived, and is likely to become more so in the early part of Mr Bernanke's term in office. Thus the US economy is heading for recession and the stock market for a major downturn. I expect this for the following reasons:
1. Monetary policy operates with long lags, in the US as much as 12-18 months."Therefore even if rates are not raised any further there is still a considerable degree of tightening to come. The remarkable growth in the use of adjustable rate mortgages in recent years may accentuate this factor, as very large numbers of mortgages revert to market rates over the next two years.
2. Although interest rates are relatively low in historical terms, whether real or nominal, they may still prove uncomfortably high in the context of unprecedented debt levels. Furthermore, the degree of tightening that has taken place - a cumulative 350 basis points in the Fed Funds rate - is already more than that which has led to recessions in the past.
3. The underlying economy is probably already weakening significantly..."

real1I would like to share my gold & silver charts with everyone#1414872/8/06; 17:27:00

And since i cant upload to your site the only way is to supply the link.

Anyway Im sorry...

FlatlinerDeflate, reflate?#1414892/8/06; 17:45:43

Anyone feeling light headed? Gold makes solid ballast.
SundeckHounds hunting well in Asia#1414902/8/06; 17:46:05

Oh, oh...looks like the hounds are onto the scent of something in Asian up $7 and silver up 13c...go Spot! Hi ho Silver! Away!

If the last "correction" was anything to go by, back in December, the present one may be all over in the blink of a miners eye...that's the trouble with trading in and out during a bull-run, often the volume available on the way back up to the initial price level is a LOT less than the volume that was given up on the way down...mostly means entering the market at a higher level than that at which you sold...strong hands win over weak hands...

Good luck boys and girls...

(I just love them dogs...)


FlatlinerJust watching#1414912/8/06; 17:55:10

NYMEx Issues for February.

Silver 200 (up from 199) or 1,000,000 ounces (up from 995,000).
Gold 6,057 (up from 5,664) or 605,700 ounces (up from 566,400).

Total Eligible in golden warehouse 2,290,560 (up from 2,238,478). Total registered 5,086,510 (up from 5,080,284).

OvSI disagree, Shermag.#1414922/8/06; 18:08:10

They probably paid him
another 880,000 under
the table for trying to
sweep away 18 years of
stealthy footprints in
the financial sands.

GoldiloxRussell#1414932/8/06; 18:18:16

@ Chris Powell,

Are you confusing me with another poster? I never even mentioned Russell.

My post about GATA and the "history books" should be construed as a reflection on the manipulated slant of academic historians more than any negative statement about your fine work. In my estimation, I put you in some pretty fine, though publicly derided, company.


NedCorrect this man.....#1414942/8/06; 18:28:06

"The market needs a correction. It can't just carry on going up," said Jeremy East, global head of precious metals at Commerzbank. "I still think we are going to see higher levels at the end of the year or maybe in the next few months, but at the moment we are seeing some profit-taking and stop-loss selling."


We are going to see a "correction" (to the north side) before end of March.

There's your "technical analysis" for the day Jeremy.

GoldiloxCorrection and Recovery#1414952/8/06; 18:29:01


You hit the nail on the head.

I "flipped" 1/3 of my gold stocks in Sinclair fashion in the few days. I got nowhere near optimum exit and entry points, but I reallocated some cash and have all my original holdings intact with a couple new ones. It was not easy, and exhausted my supply of Maalox. I probably won't elect to try that again soon.

Today's recovery came rather quickly, but so did the last one. Buyers of physical metal and mining equities are definitely looking for entry points.

OvSChristopher P.#1414962/8/06; 18:31:06

You can call me lox,
but please don't call
me Goldie.
Otherwise, you are my
man. Keep it up. OvS

Black BladePrecious and Base Metals are rebounding nicely in Asian Trade#1414972/8/06; 18:41:31

Tonight the Precious Metals (Gold, Platinum, Palladium, Rhodium, and Silver) and the Base Metals (Copper, Zinc, Nickel, Moly, etc.) ate trading higher in Asia. As I pointed out this morning - the mad dash for the exits was temporary and the weak hands and fund traders have had their fun. Now back to business. Hopefully some of you took the opportunity and accumulated more of physical today by a little trip to raid the Castle Treasury on this pullback. It was a nice gift from the traders and weak hands to those who seek "portfolio insurance".

Yesterday and to some small extent today the sell-off was simply a matter of profit-taking by funds that ran the price higher while while simultaneously placing short positions for a quick scalping. They did manage to scalp some quick profits on the sell-off, however, the "correction" ran out of steam because their just isn't much interest to divest hard assets in this secular bull market and especially when other sectors look rather grim - bonds, stocks, currencies, etc.

The cascade of selling in the natural resources sectors (and paper financial vehicles as well) led the panicked weak hands into the orchestrated sell-off driving the price dramatically lower. This is an old story that has played out time and again. The real point to all this is the overall trend is higher because we are in a "secular bull market" for hard assets and natural resources where macro-economic issues prevail over short-term position plays by funds. It's really nothing more than that - now that the shorts have had their moment in the sun - it's back to business.

Long-term the trend remains exceptionally bullish. In short - be prepared as it is everyones responsibility to to "look out for number one" and their families, after all no one else will - not even the "benevolent hand" (or "Iron Fist") of the government. The only one you can really trust when the chips are down is yourself.

As always, get out of debt and stay out of debt, stash enough emergency cash for several months expenses, accumulate Gold and Silver for wealth preservation and as "portfolio insurance", and start a storage program of nonperishable food and basic necessities.

- Black Blade

PRITCHOFrom Richard Russell - - - Latest Comments #1414982/8/06; 19:46:42

Sage advice from an 81yr old veteran. No Frost Bite here.

February 8, 2006
Frankly, if I wasn't in this business, I probably wouldn't look at the daily price of gold. Since I have no intention of selling my gold, why look at it every day. I don't ask my broker for his estimate of the value of my house every day or every week or every month. I don't give a damn what my house is worth, since I know I will never sell it.

In other words, if you hold a tangible asset and have no intention of selling it, why drive yourself crazy pricing it all the time. This is the way many a fortune has been made. And investor buys some land or a few outstanding stocks and instead of trading them, he forgets about them. In 10 or 20 years, that land or those stocks are worth a fortune. If he the same investor had been pricing his items daily, somewhere along the line he would have become uncomfortable or frightened and bailed out.

This, of course, shows the great advantage the wealthy individual has over the "little guy." The wealthy investors buys a stock, and it represents only a small fraction of his net worth. In fact, the wealthy investor hardly looks at the stock's fluctuations. The fluctuations don't affect him, they don't really change his total asset position one way or the other.

In other words, the wealthy investor is in a position to hold the stock regardless of market conditions. In the end, the stocks fluctuates, it corrects, it hits new highs, the declines, and over the years the stock hits ridiculous new highs. Finally, on a valuation basis, the investor sells. But only the wealthy investor has been able to hold this stock until the point where it became absurdly overvalued.

mikal@Pritcho#1414992/8/06; 20:08:42

Buy and hold.
mikal@BlackBlade#1415002/8/06; 20:12:31

Always enjoy your postings. Are you anticipating another busy year in the field after the thaw?
It's back to cold weather here in the northeast.

David LinkleyGreenspan#1415012/8/06; 20:35:17

Greenspan's comments the other day show just how incestuous the international financial community has become. The world economic base now sits on sand and the next real storm is going to topple alot of complacency.

As much as I dislike Bernanke as Fed Chairman, one has to feel for him as the economic storm about to hit. One by one real estate, auto sales, retail, consumer electronics and so on are about to experience a severe drop off in sales. The credit machine is sputtering as the rest of the world is getting tired of so many dollars.

Black BladeRe: Mikal#1415022/8/06; 20:45:34

It's looking like this year will probably be slow for petroleum fieldwork. The warm weather has left significant supplies of NatGas in storage. We now appear to have over 700 Bcf more in storage than what was anticipated for this time of year. Tomorrow's NatGas storage report looks like it will be another dismal draw – about 71 Bcf if ICAP data is correct. We simply did not get a winter this year and therefore no natural gas demand for heating. It's possible that some companies will drill new wells but I suspect that much of the work will be in some development work and for current production. There is no need to drill more wells and bring more product online when storage is nearly full. Right now companies are preparing budgets. I have a couple of clients that might need some work but they don't appear very excited about the prospects this year, even with current prices.

However, the mining sector is looking much better. I have talked to three old former clients and the prospects are brighter in the precious metals sector. They appear excited about the higher prices and of course they need to replace or develop new reserves. Who knows, I may have to set up shop in Elko, NV again (or Winnemucca). They also have seen the light and appear willing to raise rates for contract work after most of the experienced workers left mining for petroleum work during the last mining bust. They now find themselves short of explorationists with inexperienced personnel and recent grads not trained in exploration and development work. Anyway, next month I plan to travel to Nevada, Utah, and Colorado to talk with some people I know. Dang, give up the Yellowstone-like view for the Great Basin desert? Hmmm…

- Black Blade

Rook.,.#1415032/8/06; 21:33:42

Yeah Mikal, I agree, I am glad Black Blade is here to fill in gaps in the info others bring us. Hey BB, no fair, if you are going to tell us about your travel schedule, you have to include some travel commentary in your posts as you do your tour.
Chris PowellBeg your pardon, OvS and Goldilox#1415042/8/06; 22:02:27

At least I didn't confuse you
with Alan G!

GoldiloxAncient penny to remain in Britain#1415052/8/06; 22:37:18


A rare 1,200-year-old Anglo-Saxon gold coin that was sold at auction to an American collector will not be leaving Britain after all.

The British government blocked the export of the coin last year, and the British Museum has raised the funds needed - more than $650,000 - to buy it back. The acquisition was announced in London on Wednesday.
A treasure hunter discovered the coin in 2001 in Biggleswade, on the banks of the river Ivel about 100 kilometers, or 60 miles, north of London, using a metal detector. The gold penny, called a mancus, weighs about 3.5 grams, or an eighth of an ounce, and is slightly larger than an American penny.

The coin is highly desirable, according to numismatic experts. Not only is it in good condition, it bears an exquisite portrait of Coenwulf, King of Mercia (796-821), the only depiction of him known on a gold coin. The reverse has a design inscribed "De Vico Lvndoniae," identifying the Anglo-Saxon settlement, now London, where it was minted.

The coin's sale in October 2004 set a record price for a British coin. The buyer was Allan Davisson, a collector and dealer from Minnesota, who paid a little more than $400,000. But Davisson was blocked from bringing his prize home. David Lammy, the British minister responsible for protecting cultural heritage, announced in August that he would give the British Museum time to raise extra funds to buy the coin back. The deadline was Feb. 2.
The British Museum was able to tap sources including the National Heritage Memorial Fund, which is supported by lottery income, and is "very happy" with the outcome, according to Hannah Boulton, a museum spokeswoman.
The tug of war over the coin illustrates the workings of British law on antiquities. Considered more liberal than other countries, Britain allows those who find buried treasure to receive fair market value for it.

Davisson conceded in an interview in January, "I definitely thought this coin was worth more than I paid for it." Although the British Museum did bid in the auction, its limited funds forced it to drop out. Davisson later resold the coin to an American collector for $650,000. The British government accepted the new, higher figure as the bona fide value that should be paid for the coin.

Boulton said there was no paradox in that Britain, which has refused to return such famous antiquities as the Rosetta Stone to Egypt, is trying to block export of an item like the coin. "It's not a comparable situation," she said. "These items are all part of a wider world collection. Visitors to the British Museum can compare and contrast cultures from all civilizations - that is a concept worth defending."

In the United States, Davisson confessed to having mixed feelings. "Emotionally, I wish I could bring the coin here, but intellectually, I know it belongs in the British Museum."


I wonder what Gordy Brown thinks of all this hullabaloo over a "gold penny" during his run for No 10.

ShermagOvs#1415062/8/06; 22:39:05

You disagree. Perhaps for good reason.

I believe he is talking to shore up his legacy (or at least what he wants it to be). But I ask, who is he fooling? Who is his intended audience?

TownCrierGold Rises in Asian Trading After Biggest Drop in Eight Years#1415072/8/06; 22:59:27

Feb. 9 (Bloomberg) -- Gold in Asia rose as some buyers decided the biggest decline in more than eight years this week has made the precious metal a more attractive investment.

Gold for immediate delivery on Feb. 7 had its biggest one- day drop since 1997...

``Investors don't want to miss the buying opportunity,'' said Song Won Deog, general manager at Woori Futures Co.'s marketing strategy team in Seoul. Song predicts gold will reach $570 an ounce next week...

Gold futures for April delivery rose as much as $8.90, or 1.6 percent, to $562.70 an ounce in after-hours electronic trading on the Comex division of the New York Mercantile Exchange after losing 3.6 percent in the past two days.

``Price corrections in the metals provide opportunities, especially for physical consumers in the industrial metals markets; don't miss the boat, again,'' Barclays Capital said in a report yesterday.

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

Departing boat metaphors are nice, but at the end of the day, gold metal is something you've either had the wits to acquire as a prudent addition to your portfolio, or else you haven't. Simple as that.


contrarianDollar in Brazil#1415082/8/06; 23:38:19

I just spoke to someone who regularly travels to Brazil, he just returned from there, and he says that there has been a change there in attitudes towards the US dollar. He was referring specifically to Rio and San Paolo. He says that most people are now loath to accept dollars in transactions, preferring the Brazilian real, which is, of course, a reversal of relatively recent past attitutes. In other words, the dollar is now considered trash there.

He did say that in Buenos Aires, Argentina, there is not yet this attitude, but it has certainly taken hold in Brazil.

This is very interest on the street information, and I can think, only a harbinger of things to come.

OvSShermag.#1415092/9/06; 00:35:40

When I said I disagree
I meant that I disagree
that his audiences should
ask for their money back.
People in the highest
political echelons do
"favors" and when retired,
give speeches and the
honorarium is a form of
payback. It doesn't really
matter so much what they
have to say.
A.G., for his two last
"speeches" received 25,000
dollars more than he got
paid in salary for all of
2006...And, of course, you
are right when you think
that he uses these speeches
to whitewash reality...
On the other hand, these
and other more contemptible
practices are even worse
anywhere else in the world.

OvSCorrection.#1415102/9/06; 00:37:25

Of course I meant 2005.
tejbearContrarian #1415112/9/06; 06:48:42

Dollar in Brazil

What is your read on the rate of the collapse of the dollar. From what I have read, in one extreme, Paul Volker expects the "crash" in less than one month. However, Stephen Roach expects it to be spread over 3 to 5 years. I guess I lean towards Paul as Warren Buffet is way concerned about the house of derivatives collapsing and the derivatives could be gone in a few weeks.

The Bear

contrarianDollar in Brazil#1415122/9/06; 08:26:58

I think you'll actually have both scenarios. You'll have a gradual drop in value, which we've been having, and then you'll reach the so called tipping point, which is how things seem to function in the real world, and then there will be a drastic crash, possibly overnight.

Changing of liquid to solid state, for example, happens this way. It's not perfectly gradual, but discontinuous, eventually reaching a critical point where the change suddenly happens.

Some people think, though, that the government may intervene and back the dollar again with gold in some form to stave off this extreme end point, so the tipping point won't be reached. If that happens, that would also involve confiscation of course. Perhaps unlikely? As it would involve a complete reverse course direction on attitude towards gold.

Barring that I would tend to look to history and see how all abused paper currencies end up in the toilet. And by default, gold will reign the champ.

The end of oil being traded in dollars does seem to be an eventuality.

Certainly the derivatives thing will unfold suddenly, probably unwinding within a few weeks. Once a critical point is reached, I can't imagine a lingering death for the dollar.

Well the dollar replaced the pound, but that was in a time where there was gold backing of currencies. Now is not the case, so I can easily see a drastic fall in the dollar at some point.

Here's a post from late 2005 that gives a good roadmap:
Gold Price Countdown - the Fall of 2005 A Speculation By "specie-man" - 10 November, 2003

In 1997, a mysterious individual began a series of anonymous postings on gold-related internet bulletin boards. This person, and their associate, seemed to have inside knowledge of world gold dealings. The information they relayed indicated, in a somewhat cryptic way, that there were two completely different gold markets in existence.

One of those markets is the paper gold market that we all see (COMEX) - a market who's hidden purpose is to suppress the price of gold and to generally manipulate the market in favor of commercial (short) entities, at the expense of speculative (long) entities.

The other hidden market was larger, and traded in physical gold only - at prices far higher than the paper gold market. As the theory goes, this market was the vehicle for transferring large quantities of gold to rich oil-producing countries. This arrangement was secretly agreed upon by banks and governments, so that in return, the price of oil (as measured in US dollars) would remain stable even during the economic boom years of the late 1990s. This was at the core of the so-called "strong dollar policy", which the US Government frequently mentions but never seems to be able to explain.

The two markets worked together such that the paper gold market would effectively siphon off world gold supply and production at reduced prices, and deliver it to the secondary "hidden" market at a profit. Why would the large buyers acquire gold on this hidden market, rather than buying contracts for future delivery for lower prices in the paper market ? Because it would have been impossible to purchase the desired quantities of physical metal on the limited paper market, and any attempt to do so would send the price of gold much higher on both markets, possibly destroying the paper market and ending the price suppression of gold. This would cut off their supply of relatively cheap gold. Perhaps the intentions of these major buyers are to first obtain large quantities of gold, and then go to the paper market to drive up the price.

The individuals responsible for bringing this information to light predicted that at some point, the world price of gold would be revised sharply higher (by orders of magnitude) in conjunction with a move by oil-producing nations to officially reduce their intake of US dollars and increase their intake of other currencies and gold. This monstrous gold price increase would signal the beginning of a new world order. That prediction was made around 1998, possibly to occur in the 1998-1999 time frame.

These individuals correctly predicted a badly-faltering stock market and economic malaise. But now, four years later, their predictions about a rapid gold re-pricing event have not taken place. Gold has increased in price significantly in the last four years, but the rise has been relatively gradual. Gold bugs are still waiting for that big event. Will it come and, if so, when ?

Before any major gold price upheaval (increase) can occur, certain conditions must first exist. Some have already occurred, and others are developing. Watching the progress of these conditions will be like watching a rocket launch count-down ! Those who are watching will know when their last chance will be to jump on board before lift off. Here is the count-down as towards an explosion in the price of gold (as a result of a crashing US Dollar):

12. Rapid expansion of world-wide credit (debt).

11. Stock market declines.

10. US government, state/local governments, corporations, and households go much deeper in debt.

9. US trade deficit expands relentlessly.

8. The US dollar starts declining in value relative to other world currencies.

7. Long-term interest rates increase relative to short-term interest rates, bond market declines.

6. Housing prices level-off and start declining in some areas.

5. Other (Asian) countries counter the falling US dollar by working to devalue their own currencies.

4. Gold starts rising in price relative to all major world currencies, including the Swiss Franc.

<===== WE ARE HERE !

Inflation/stagflation starts taking hold in Japan, China, and other countries that have a large trade surplus with the US. Bad debts are monetized en-masse (paid off by "printing" large quantities of the local currencies). This is highly inflationary. To forestall hyper-inflation, Asian central banks will be forced to cash in some of their dollar reserves to bail out large debtors (commercial banks, etc.). This will bring an end to the "strong dollar" policies of those governments. Japan, for example, will no longer print and dump as much Yen on the market and buy dollars to weaken the Yen relative to the Dollar.

Consumption in foreign (especially Asian) economies starts growing more rapidly and oil-producing nations realize that they will no longer have to rely as much on the US market to sell their oil. At that point they won't have to worry about how much oil the US consumes (or how much a barrel of oil costs in US dollars). Due to the world-wide glut of declining-value US dollars, and a revulsion for US foreign policies, some oil-producing nations begin switching their official oil pricing currency from US dollars to another currency and/or gold.

The paper gold market (COMEX) shows a large increase in speculative long positions. The long speculators have been trounced many times over the years by the commercial (short) traders. This time, however, the ranks of the long speculators will grow and grow. They will hold firm in the face of the commercial shorting onslaught, as if being commanded by General Stonewall Jackson himself. The commercial shorts will break and run as people world-wide attempt to take delivery of gold. Some major financial institutions will fail as a result.

0. Blast-Off !
Foreign countries no longer have a need for the excessive amounts of US dollar assets (US Treasury bonds) that they hold because it becomes increasingly difficult to purchase oil (and/or gold) with them. Foreign governments do not buy and hold US Treasury bonds out of the goodness of their hearts. The second that they no longer have the need or ability to hold and acquire those assets, or the instant they perceive that their ability to exchange them for something useful is diminishing, they will dump them for something else. A world-wide "crash" in the US dollar will result, leading to a world-wide revulsion of anything and everything US dollar, much higher US interest rates, a severe case of hyper-"stagflation", and higher prices for all tangible assets. The derivative pyramid will crumble. The US dollar will become the "laughing stock" of world currencies - akin to some of the weak currencies of the Central American and South American regions. All this occurs just as the first wave of American "baby doomers" are scheduled to retire. Life will go on in the US and it won't be all bad, but it will be very different and difficult.

Right now, the countdown is at 3 and counting. Many of these events have been (and will be) occurring concurrently. What is still lacking is significant world-wide wage inflation (but world-wide commodity prices are now escalating). When you hear the phrase "wages are increasing to keep up with inflation", you will know that the time is very close. Current indications are that the final prerequisites for a blast-off in the gold price are forming. Hints of inflation in Japan, commodities, and elsewhere are starting to appear, as is talk about doing something about the bad debts in Japan, and bad debts rapidly increasing in China. The US Federal Reserve will aggressively fight any significant downturns in real estate prices. They will do anything, even drop cash from helicopters, to prevent consumers from defaulting on their mortgages en masse. The alternative is just to catastrophic.

The COMEX open interest in gold is now increasing. Battles between the commercials (short) and the speculators (long) have usually ended in favor of the commercial traders. This time, it will end in a stalemate - a moral victory for the longs. The day when the longs totally rout the commercial shorts is coming fairly soon.

History is riddled with unfulfilled predictions of gold's price soaring (and collapsing). Gold is heating up now. But realistically, how long might it be before the price explodes rapidly upwards in an economic upheaval of epic proportions ? That is hard to say. The old saying definitely applies here: "markets always do WHAT they are supposed to, but never WHEN they are supposed to". Such drastic economic realignments are always fought against by governments, and they always take longer than expected.

Should all the current COMEX longs hold firm and a quantity of them demand physical delivery, then the countdown could go to blast-off immediately. Other "wild-card" events (war, terrorist attack, major California earthquake, etc.) could ignite the rocket as well. The countdown process started in the mid 1990s and it should last about ten years. The closer the countdown gets to zero, the faster it will tick. Gold will continue to increase in price during the remainder of the countdown. ! Lacking any unexpected triggers, the countdown will finish during the Fall of 2005.

GoldiloxCrashing March#1415132/9/06; 09:01:43


And as if my own worries about March aren't enough, fractals contributor Gary Lammert reminds us that coming out of the pending collapse period may not be as swift as the 1930's were for the simple reason that energy's past its prime:

"In the background of all of these mechanistic consumer and generational long cycles of expansion and contraction and contemporary to the the US second 'Grand Fractal' is the transient 150 or so year window of a petroleum based world economy. For the US the next 140 year growth period, after this second cycle has its nonlinear end, will evolve in the shadow of oil depleted world coupled with a growing world population - tough times ahead for our children and grandchildren....Warm regards Gary"

OK: let me line 'em up.
1. Web bot context change due.
2. Iran oil bourse opens
3. Iran bombing being openly discussed for the 28th of March
4. Israel elections
5. Astrological signs are a coincident indicator
6. Elliott decline possible
7. 80 week cycle
8. Early announcements of drought impacts possible - Dust Bowl II
9. Greenspan attacking gold prices as a terror reaction
10. Extended Fed meeting announced
11. Then there's the housing problem...
12. Then there's people getting liquid to pay IRS bills...
13. Then there's the ocean currents shutting down and....

Add them all up and it's not for certain anything at all will happen. On the other hand, I wouldn't be placing big bets against it. Remember, we talked about an emotional release around February 3rd and the cartoon outrage hit that one spot on. Between now and mid March, all I'm hoping for is a little peace and quiet...


Like "Gold to the Moon", there are lots of fundamentals to support upcoming economic contraction, but lots of machinations trying to avoid it, as well.

contrarianOrder of Things#1415142/9/06; 09:16:03

Seems like a dollar disaster looms, but not immediately. Think a stock market crash first, then maybe a new war, an oil embargo, then a dollar disaster. Urban Survival seems to be right on.

Why? Because it's apparent, the Fed's main goal is saving the dollar, not the stock market, so reducing or stalling interest rate increases is not an option. They crashed the Dow before, in 2000, via repeated interest rate increases, and always react after the fact. So after the yield curve inverts and the stock market crashes, then they'll relent. But they are between a rock and a hard place. They've got to keep selling those bonds and bills. As for housing, I don't know, but I think it gets the same kick in the pants.

TownCrierIMF sees strong growth for Vietnam economy#1415152/9/06; 09:26:08

Il Houng Lee, the IMF's Senior Resident Representative in Hanoi, assured the IMF would continue to provide Vietnam more general assistance in implementing WTO-related commitments -- like drafting and reviewing new laws where it had expertise, and helping assess external balance of payments developments to ensure Vietnam was not exposed to external risks as it implemented the commitments.

"I think that Vietnam's process is already well advanced, requiring now only specific bilateral negotiations," Lee said.

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

If you can remember my news post of January 25th in which Germany's Merkel proposed new focus for the Bretton Woods institutions, here we already see signs that the IMF has indeed been evolving beyond its original monetary orientation toward more of an international trade orientation -- ostensibly in an effort to stay relevant in a world that, thanks to the eurosystem's reserve design, has now radically outgrown the usefulness of institutions solely serving the Bretton Woods legacy.

For the IMF, it seems that adaptation is the name of the game.

And back on the topic of Vietnam, elsewhere Spencer White, the chief Asian equity strategist for Merrill Lynch, has made the observation that wealth is being created at a turbo-charged rate... "Bicycles have been swapped for BMWs in the streets of Hanoi and Ho Chi Minh City."

Growth in the levels of personal wealth goes hand in hand with increases in gold ownership.


TownCrierValentine's Day is Tuesday... already??!#1415162/9/06; 09:33:22

Call Marie and see if you still have time to pull this holiday out of the fire.

A little gold for your sweetheart... it's the gift that keeps giving.

1-800-869-5115 Extention 106


Flatliner@tejbear – ‘rate of the collapse’#1415172/9/06; 09:48:04

If I could add just a little to the Contrarian's great repost, it would be to simply mention that if the US dollar were to not act like a reserve currency, it would probably resemble any other major currency with regards to crashing (or any other currency for that matter).

Take a look at the Ruble back to the fall of 1998. The price of gold appeared stable around 2000 ruble per ounce. Then, the ‘crash’ hit and seemingly overnight, the price spiked to nearly 5000. In uncharted territory, over the next year it traded as high as 7000. Eight years have passed and it's now trading over 15000.

Looking back at the Real, in January 1999, seemingly overnight, the price of gold jumped from maybe 350 to nearly 600. In this last year, for those who watch, they got to see something similar in Zimbabwe. The price in the end of October jumped from maybe 12 million to about 20 million overnight and then extended that move by the end of the month to nearly 28 million. Six months later, it's trading at about 55 million.

It seems to me that in every case that I look at, the price of gold nearly doubles ‘overnight’. Then, there are years where the shock moves through the system and the price continues to go up at alarming rates.

But the US Dollar is slightly different. It has the luxury of being a reserve currency. Everyone holds it. Everyone uses it as the means of exchange. There seems to be orders of magnitude more US dollars in circulation (and reserve) then the other currencies listed in the above examples. What this surplus of US Dollars really means is kind of unknown in reference to a ‘crash.’ But, the way I see it is that if there are an order of magnitude more US Dollars fighting for resources the ‘crash’ might be an order of magnitude larger.

In the long run, if there is an overnight ‘crash’, the affects will be felt for years! It's not overnight riches as in a ‘pot of gold’ for those that save without currencies, but rather a foundation upon which you get to rebuild your life. Those that hold gold will find it as precious as water in the desert for years and all will be jealous of your treasure chest.

TownCrierBank of America to begin trading metals in summer#1415182/9/06; 09:58:31

NEW YORK – Bank of America plans to launch a metals trading business to expand its existing commodities offerings with a target date set for early summer ... the company said it will have metals trading operations in both London and New York.

...Peter Merritt, who joined the financial services company in New York, will lead the team as a Managing Director and Global Head of Metals.

The No. 2 U.S. bank said it will also add a team of metals traders and marketers, including Simon Underhill, Managing Director and Marketer based in London; Simon Jackson, Principal, Commodities Sales; Alan McHugh, Principal, Commodities Sales; Mark Newson-Smith, Principal and Marketer; and Tony Shaw, Principal and Marketer.

Each of the new metals team members have between 20 and 30 years of experience in metals or commodity markets and all worked most recently on HSBC Holdings Plc's metals trading desks in London and New York.

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

Here's an interesting way to look at this. Instead of seeing this as direct news regarding the choice of metal-novice Bank of America, you could rather ponder whether there is any deeper significance that so many staff have become available from old master HSBC.

HSBC has become a prominent player on the gold custodian scene. Is it possible that it has seen beyond the myopic trader mentality?


USAGOLD / Centennial Precious Metals, Inc.February Special#1415192/9/06; 10:03:41

February Buyers' Group
Special discounts and incentives on special coins!

German Wilhelm II (and Wilhelm I)

German 20 mark gold coin

Call and Save
1-800-869-5115 (Ext. 100)

TownCrierGerman Wilhelm II coins...#1415212/9/06; 10:14:28

In case you are wondering how these German coins will look nestled in with the rest of your golden savings, click the URL above and you'll see the German coin elegantly coexisting in this peaceful gathering with representatives of the other popular coins.

(if you have trouble spotting it, look centrally, top of pile)


TownCrierZimbabwe: Chamber of mines warns of gold depletion#1415222/9/06; 10:25:16$StorySummary$0.$DirectLink$2&sp=l17126

9February2006 -- Zimbabwe's gold reserves are fast depleting and pushing hundreds of miners out of business, the Chamber of Mines said in a letter to the government obtained by AFP today.

"With more than two million operators out there, surface gold is fast running out," Jack Murehwa, president of the mining association, said in a letter to Mines Minister Amos Midzi.

"Operators are now moving into alternative employment like farming," he said.

Last year, President Robert Mugabe said the government would seek 50 percent shareholding in all foreign-owned mines.

Murehwa said uncertainty about the legislation had stopped both potential foreign and local investors committing borrowed and equity funds towards exploration and expansion, for fear of losing both control of business and a big portion of their investment.

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

Seems to me the more relevant concern keeping shareholders at bay would be the desire not to hold a wasting asset. Nobody wants to be the owner of a mine when it reaches the point where all of the reserves are gone and all that's left for the miners to do is farming.

Such shareholders would be wise to skip the painful corporate transition and put their money directly into ConAgra shares to begin with.

And if it is truly gold that they're after, likewise, they would do better to skip the corporate monkey business and put their money straight away into the final, enduring product -- the gold metal.


Flatlinerdeliver it to the secondary "hidden" market at a profit#1415232/9/06; 10:36:35

Just thinking out loud. In the post below, dug out of the archives, it says that gold moved from a cheap public market to an expensive hidden market. I can't help but think that huge profits were made by someone when this occurred. At the same time, there are organizations that are in huge loss positions in the paper gold market. Could these loss positions have already been offset with previous profits?

Does anyone know if there is any public way to determine who is long in the paper gold market?

OvSJewelry Market.#1415242/9/06; 11:04:54

Seems to me that those
strong gold buys by
jewelry stores and
corporations might camo-
flage stealth buying by
a big accumulator(s).
After all, the common
and middle-class person
hasn't caught on to the
happenings in the gold
market, yet.
And the upper-class jew-
elry market is precious
stones and pearls.
Are there some posters
who can get us the inside
scoop?...Just a thought.

specie-manChecking In, US Dollar, Recent Market Action#1415252/9/06; 11:21:27

Finally getting around to checking in ...

People have been predicting a collapse of the US Dollar for decades, ever since the height of the Vietnam war (and before). It hasn't happened. It is still a possibility, however. But more likely, in my opinion, is an episode like the late 1970s. There are a lot of parallels between 1976 and 2006. In 1980, the disaster was averted by spiking up the interest rates. Volker did it then because he COULD. The average American was not so much in debt that they couldn't tolerate (with some hardship) the much higher rates. I don't believe Bernanke has that luxury. Some analysts point to the high debt levels of today as an indication of coming deflation. I see it as a roadblock to the FED jacking up rates quickly.

The FED will take whatever path MAXIMIZES the number of people taking on debt AND SERVICING THAT DEBT. The nightmare for the FED (and for foreign Dollar debt holders) is that people will give up servicing their debt en masse. With current debt loads, raising interest rates significantly higher would put much of the debt servicing in danger. So the FED can only raise rates to moderate levels, staying well back of the true rate of inflation.

So I see a continued protracted (not overnight) shift away from the Dollar towards alternatives, such as anything tangible.
But if a catastophic shock to the geopolitical landscape occurs, the shift could be overnight - but I don't see it happening that way.

Regarding the dollar in Brazil ...

My anecdotal evidence is perhaps another part of the picture. One of the things I do as a sideline is to buy & sell coins. Mostly "collector" coins but some bullion as well - I'd like to keep some of the bullion, but can't afford to on my modest income (fortunately, we do have a nice precious metals IRA in safekeeping off-site). Anyway, in the past year, I have noticed a definite uptick in purchases from foreign buyers. Many of these buyers purchased modestly-priced items and paid for them by sending BRAND-NEW never-folded US currency in the mail (yes, the bills were real). It is interesting to contemplate how unfolded US bills are getting over to Europe and elsewhere. And now they are coming back. In the past year, I've sold things to places I never would have expected. I sold an off-center stuck (mint error) US Indian Head cent to a buyer in Taiwan. I sold coins issued by Iceland and Botswana to a buyer in mainland China. I sold a large batch of various world silver coins to a buyer in Russia.

Regarding the recent market action...

On Tuesday evening, after silver had its big drop, I sold a 10-ounce silver bar (Sunshine Mint) and the buyer was eager to get it for about $110 - even though the spot price of silver was only $9.25 at the time.

My observation is that the price of physical metal (in bar or coin form) is more stable than the paper (futures) price. When the metal prices spike upwards, buyers of physical metal usually pay a bit under spot price to cover themselves in case of a subsequent decline. When the paper price drops, buyers of physical metal offer spot or sometimes above spot prices because nobody wants to sell physical metal at the lower prices.

TownCrierFlatliner, your question#1415262/9/06; 11:32:53

"Does anyone know if there is any public way to determine WHO is long in the paper gold market?"

It begs this follow-up inquiry...

What would you DO with this information? Would there be a productive outcome to it?

In other words, traveling some avenues is time well spent, others might just be dead ends.

A lot of folks have chased around a lot of elaborate schemes with little else to show for it in the end other than personal exhaustion, meanwhile they ignored the workhorse gold which was right under their nose the whole time. So, does it really matter exactly which names the longs belong to? Sometimes the best epiphanies come not from acquitions of more info, but rather from clearing away the distractions.

On another note, your #141517 was an excellent presentation. Thanks.


real1Special risks when investing in a mining company #1415272/9/06; 11:45:55

In addition to the usual risks involved when investing in a stock of given company like: mismanagement, corporation frauds, dilutions, Etc. Investing in a mining company carries specific additional risks:

1) Mining is depleting business, the more you mine the less reserves you have, unless you explore and find new reserves fast enough.

2) The revenues are completely dependent on the market price of the metal and the mining company is a price taker.

3) Hedging, some mining companies have sold some of their future production through the futures and derivatives market. They have sold in much lower prices, so higher metals prices do not always translate to higher revenues and higher profits.

4) Geo political risk, as the prices of metals are going up it is tempting for government to increase mining taxes. Under some circumstances mining licenses could be frozen or canceled.

The conclusions are: the price of some gold and silver mining stocks could outperform and give better appreciation then the price of gold and silver, but the risk is also higher. Be sure to do a good research before putting good money into any stock and don't place all your eggs in one basket – diversify.
If a gold or silver company has only one mine or no production at all the situation is even more risky as is the case with exploration companies.

specie-man@contrarian - roadmap#1415282/9/06; 11:49:33

I see you dredged up my old post from 2003 "The Fall of 2005".

It would seem that we are still somewhat on track if not on the precise schedule. One could argure that the real blastoff in precious metals prices started in the Fall of 2005, or one could argue that it hasn't really started yet.

In any event, one key is still Japan. When inflation really starts getting a grip there - look out. The Yen has been weak for over a decade now - even during times of near-deflation in Japan. Imagine how weak it will be against gold during the pending inflationary times.

Some analysts have warned that China is in for a crash landing or a maybe a soft landing, and neither would be good for commodity prices.

But my view is that China will grow it's domestic consumer markets at roughly the same rate at which it shrinks it's export markets for a net change of zero. So China will still continue to grow fast, while much of the worldwide inflation they have been absorbing in the past will instead remain in the countries of origin.

TownCrierFirst 30-yr Treasury bond auction since August 2001#1415292/9/06; 12:24:41

NEW YORK, Feb 9 (Reuters) - U.S. Treasury debt prices rallied on Thursday after the first auction of 30-year bonds in more than four years garnered strong indirect bidding, even though the bid-to-cover ratio was a bit low.

...Indirect bidders, which include customers of primary dealers and foreign central banks, snagged $9.07 billion, or 64.8 percent of the deal. Historically, offshore central banks have tended to avoid longer maturities.

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

Central bankers don't mind a little 'conundrum' here and there when the the outcome of their 'unusual' behavior serves a transitionary purpose that has been duly factored into a bigger picture.

That is, keep the ailing system on its feet with cheap and simple tricks that provide the basic appearance of a dollar that's strong for the long term, meanwhile delicately working "under the radar" to accomplish non-disruptive gold redistributions as prerequisite to the inevitable transtion away from asymmetric dollar reserves toward a more economically level playing field as facilitated by a foundation of price-liberalized gold reserves.


Flatliner@TownCrier#1415302/9/06; 12:32:23

Thank you and I have no intention of running to a personal exhaustion (if it can be avoided).

HOOSIER GOLDBUG's comments are still rattling in my pea-size brain. One has to wonder when you see someone completely give up the ghost on a cause as to what it was that they were really thinking at the time. Thus, it has made me wonder as to the extent as to the control that is really exerted over the price of gold in the public markets. It seems that you have come to a level of confidence that helps you see a slow and steady re-valuation in the price of gold is and can be. I have been looking for clues as to how this might be done – so completely.

My current efforts have me thinking about how someone might have huge positions on both sides of the futures market and use time – both short term and long term – to weight things in their favor. In other words, can short term raids offset long term losses so as to not cause derivative style failures?

It seems like a wild off the trail concept, but it is a side excursion with little weight in light of the changing world view of gold. People's perceptions are changing, and given a little time, that will bring out the real sparkle in all precious metals. This is evident, as seen in postings like specie-man's # 141525 where it's as if fear has gripped someone and they panic into metal happily paying over-spot for piece of mind. On a very individual basis, it's as if people are waking up to see that they've been trapped and they are willing to pay anything to be freed.

Freedom will come. People are choosing it. One coin at a time, they move away from that which if freely printed and recklessly distributed. We watch and save.

TownCrierFlatliner, on Specie-man's pricing comments#1415322/9/06; 13:28:50

I think you'll find more sense in them if you consider that in refence to buying and selling prices he was speaking from P.O.V. as a middleman (retailer) rather than as the buying- or selling- end user (customer).


Flatliner@TownCrier#1415332/9/06; 13:33:33

You're perspective brings new light to the entire situation. There is great value in simple gold ownership. Thank you.
GoldiloxGold output dropped 12.8% in 2005#1415342/9/06; 13:36:06


The country's gold production in 2005 declined by 12.8 percent when compared with 2004, Statistics South Africa said on Thursday.

In the three months to December 2005 gold output fell by 8.8 percent when compared with the three months to December 2004.

Gold production in December 2005 was 3.8 percent lower than output in December 2004.

Mine output up in 2005

Mining output for 2005 increased by 2.6 percent when compared with 2004, due to a 6.1 percent increase in the production of non-gold minerals.

The total mining production for the fourth quarter of 2005, after seasonal adjustment, decreased by 3.1 percent when compared with the previous quarter.

The decrease was due to a seasonal adjusted decrease of 4.3 percent in the production of non-gold minerals during the fourth quarter of 2005 when compared with the previous quarter.

The seasonally adjusted decrease of 4.3 percent in the production of non-gold minerals was mainly due to a decrease in the production of platinum group metals (PGMs) by four percent, coal by 0.8 percent and iron ore by 0.2 percent.


It looks like the alchemists are just not keeping up with demand. If the CB's are really curtailing their blue light specials, product has to come from somewhere. I ain't sellin' mine.

TownCrierFed's Moskow-many reasons for low long-term rates#1415352/9/06; 13:36:56

CHICAGO, Feb 9 (Reuters) - There is no one answer to why long-term bond yields in the United States and globally are so low, contributing to a flat yield curve, Chicago Federal Reserve Bank President Michael Moskow said on Thursday.

"It's certainly a puzzle, it's something that no one has a precise answer to," Moskow said in response to a question after a speech.

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

No one??? Hey Moskow, try spending a day or two at the USAGOLD forum and you'd be among the few who have the answer. To clue you in VERY briefly, scroll down to msg# 141529.


GoldiloxHSA Fee#1415362/9/06; 14:19:50

The HSA is offering a "smart card" for frequent travelers, once they pay a fee to a private security firm for security checks.

Now, who is going to monitor the security firms ability to guarantee that they keep terrorists who are willing to pay for the checks out of the system.

One more revenue source from government imposed fear, not unlike Lockheeds' $billion dollar public camera contracts.

They're not likely to make anyone "safer", but the "soldiers of fortune" are having a field day inventing new security services they can sell to Government and corporate America.

When they come out with the anti-terrorist measures for gold, I'm gonna be really suspicious that they are just gathering more information on gold ownership at our expense.

USAGOLD Daily Market ReportPage Update!#1415372/9/06; 14:32:41">
The Daily Gold Market Report has been updated.

If you are considering investments in gold we invite you to">request our free introductory information packet detailing the products and services offered by USAGOLD ~ Centennial Precious Metals. We welcome your inquiry and look forward to working with you.

THURSDAY Market Excerpts

Gold $14 higher as investors buy the dips

February 9 (from MarketWatch) -- Gold futures closed higher Thursday, chalking up a gain of more than $14 an ounce, with strong investment and physical demand for the precious metals revived after prices drop to a three-week low in the previous session.

"This market is not close to being finished for higher prices," said John Person, president of National Futures Advisory Service.

COMEX April gold futures up $14.30 at $566.10. Prices closed at under $554 on Wednesday, the lowest since Jan. 18, after dropping by nearly $20 an ounce in Tuesday's session.

"The targets of $600 to $625 are more and more a reality and mostly justified as concerns on inflation, geopolitical pressures in the Middle East and now with rates at comfortable levels, central bankers are stuck in a rock and a hard place," said Person.

Central bankers "risk choking off economic growth by raising rates too much, but on the other hand inflation is a genuine threat," he said.

The overnight move "shows just how fast this particular market can move higher when the market is scared," said Kevin Kerr, a veteran commodities trader and commentator for MarketWatch. "Gold seems to also be rebounding from the steep over-the-cliff type of profit taking we have seen in the last two days," he said. "Funds wanted to take some cash off the table and gold was due for a correction anyway but now that a healthy cleansing has happened the market can resume its rise."

There's a "staggering amount of liquidity sitting on the sidelines waiting for precisely such a pullback," said Jon Nadler, an investment products analyst at bullion dealers Kitco.

"The market cannot and will not have a constructive foundation and framework if we do not have corrections along the way," he said. "People have not bailed out of gold completely and ... there are many who await a fresh opportunity to buy."

Action Economics said gold also benefited from fund "value buying" during the Asia session, where traders were betting that the sharp correction seen this week had run its course.

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

Golden Lionheart100kg of gold up for grabs!#1415382/9/06; 16:36:37

My local newspaper the West Australian reports today that the Taliban is offering 100kg of gold to anyone who kills the person responsible for publishing blasphemous cartoons in Denmark.

On a more pleasant note, the 4.33gm gold coin struck during the reign of King Coenwulf in Britain in 805-810 and found by someone with a metal-detector, was bought by the British Museum for £357,832.
The coin was originally the value of 30 days wages for a skilled Anglo-Saxon worker!! Now that shows the worth of holding the physical!

spikedogFree-gold transition#1415392/9/06; 17:04:09

Perhaps a very simplistic (crude) way of looking at the actions of the various CBs with respect to purchasing US debt is: retail stores offering loss-leaders (eg; products sold at a loss in order to entice the customer into the store, where, it is hoped, they will spend money on the higher margin merchandise as well). Ergo, the CBs make a loss-leading investment in US debt in an effort to smooth the transition to higher-margin gold!

Musings for a wonderful Thursday spike!


SundeckWhat a difference "sentiment" makes...#1415402/9/06; 18:52:52

Well...look at that. POG pretty-much back where it started around $570. That looks like the "rebound" from a crowd with "positive" sentiment...


Consider two which is confident in its convictions and another which is unsure and divided in its convictions.

Send a negative shock (surprise) into each crowd and what happens? Unpredictable, really, I know....but the usure/divided crowd is likely to panic and scatter; perhaps regrouping later on, having given ground. On the other hand, the confident crowd is more likely to yield a bit, but remain coherent and push back with a vengeance...perhaps gaining more "turf" than it held before...

Let's see if the prices of gold and silver settle a little (or a lot) higher than they were before...say above $580 for gold and above $10 for silver...

Quite a few of those players who sold their positions into the recent POG down-draft will have surrendered their gold to other players. To regain their positions in the short-term, they may have to buy at higher prices...

But then....they may just choose to wait and hope for another round of shenannigans...

That's the market...unpredictable...


GoldiloxThe Hidden "Why" Behind Asian PHYSICAL Gold Buying#1415412/9/06; 22:49:37


The China Sea at this time in the financial world is more of a non subject than gold was in 1999 or the Avian Flu eighteen months ago. There is a strong probability no subject is more important to the energy equation than the disposition of the growing conflict over "who-owns-what" in the China Sea. The point is not entirely the undersea wealth being claimed by every nation in the area, but rather the potential to clog the routes of energy shipments that currently exist there. When you put heavily armed and technologically equipped killers in such close proximity, the potential for an accident starting a conflict is almost certain.

The newest trend worldwide is to name everything exactly what it is not. A prime example of this is the Patriot Act. Tell Samuel Adams or Jefferson what is in that piece of legislation and ask them if the name "Patriot" is appropriate.

Not to be outdone by the US and GB, China has joined with ASEAN. This means China has been elected by them to become the "PEACE" keeper of the China Sea. Do you really feel it is "PEACE" keeping or keeping the "PIECES" of the new mammoth gas and oil discovery away from Japan and its closest ally the USA?


If USD assets are no good in the the marketplace to purchase UnoCal's Asian holdings, China MUST guarantee energy deliveries by other agreements. They will not let themselves be trapped in the box that 1940 Imperial Japan found themselves in. The Resource Wars continue to build intensity. Now, why was the largest US Navy taskforce ever assembled sent to the China Sea region in 2005? Follow the money!

Black BladeIs Recession In The Cards?#1415422/9/06; 22:51:00

Note that the yield curve has inverted. This has been a fairly accurate indicator of a coming recession. The 6 month bond is 16 basis points higher than the 30yr bond.

Check and Mate - Game Over!

- Black Blade

physicalmanCheck in -super late#1415432/10/06; 00:09:33

Checking in, sorry to be so late but have been very ill for about 2 months. Keep up the fantastic posts and knowledge ev 1
TownCrierHEADLINE: Why you gotta have gold#1415442/10/06; 01:45:44

(Moneyweb) 10-FEB-06
...All one needs do is watch the news headlines – Hamas's unexpected political triumph; the ascension of a conservative leader in Iran followed by the serious nuclear power crisis; friction between Japan and China (and Taiwan); worries about Osama bin Laden's next move; the jittery security situation in the US. And, of course, what might the free world's enigmatic leader George W Bush do next?

The recent volatility of the gold price ($575 last week; bottoming at $545 this) will continue. Traders will love it. For investors with a longer horizon, such jolts can be disturbing. But be assured, because of the unique circumstances that prevail today, gold is one of the investment world's best bets. Every portfolio should have some.

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

Like many other articles, this one still doesn't touch on the reasons that I, personally, see as the most compelling reasons to own gold. But then again, those reasons coalesced into a singular thesis simply doesn't have the necessary 'sex appeal' to warrant coverage in the mainstream media for mainstream readers. (Hell, they barely get a stir even when presented here!)


White RoseThe dollar is dropping sharply.#1415452/10/06; 07:29:12

Now it gets interesting.
DruidU.S. Trade Deficit Hits All-Time High#1415462/10/06; 07:40:34


America's Trade Deficit Hits All-Time High of $725.8 Billion in 2005 on Imports of Oil, Food

WASHINGTON (AP) -- The U.S. trade deficit soared to an all-time high of $725.8 billion in 2005, pushed upward by record imports of oil, food, cars and other consumer goods. The deficit with China hit an all-time high as did America's deficits with Japan, Europe, OPEC, Canada, Mexico and South and Central America.

Druid: I guess a better question would be, is there a country we trade with that we don't have a deficit with?

mikalFunds welcome old bond return#1415472/10/06; 08:22:52

U.S. Treasuries Rise, Led by Gains in the New 30 Yr Bond - Elizabeth Stanton - February 10, 2006
There appears to be some movement out of gold by funds esp. pension funds seeking the traditional allure of the 30 Yr. Article also touches on inverted yield curve, Fed rate direction and similar topics.

mikal"Funds of funds" of fraud#1415482/10/06; 08:35:31

"Funds of Hedge Funds" Prosper in Region - Drew De Silver - November 10, 2006
Almost whimsical little story on the "lucrative" phenomenom of the once secret hedge fund industry and their dependence on layered derivatives.
"A fund of a fund is a fund of mine!" Would be funny if not so sad.

mikalDate correction#1415492/10/06; 08:56:01

Seattle Times story below is dated today the 10th.
YGMRandy....#1415502/10/06; 09:08:15

"(Hell, they barely get a stir even when presented here!)"
Maybe that's because you're preaching to the choir as they say. Probably already have a converted audience! :-)

GoldiloxNever fear, Underdog is here!#1415512/10/06; 09:19:16

Wow, no sooner do the bleak trade deficit numbers get published to prime the waterfall pump, and US dollar buyers come out of the woodwork. . .hmmmm.
YGMChina's First Gold Fund (Excellent ramifications for Gold)#1415522/10/06; 09:21:23

Association wants to set up gold fund
By Zheng Lifei (China Daily)
Updated: 2006-02-10 05:32

China is planning to set up a gold investment fund, hoping to capitalize on the surging price of the metal.

If successful, the fund, which is still at the proposal stage, will be the country's first gold investment fund.

International Finance News, a Shanghai-based business newspaper, reported earlier this week that the China Gold Association (CGA) is considering setting up a fund with other partners, who include commercial banks and gold miners, citing Hou Huimin, the CGA's vice-chairman.

"The (setting up of the) fund is still in its research and study phase," Lu Wenyuan, secretary-general of the CGA, said yesterday, declining to elaborate.

"We are still in discussion with other parties on the issue and have not yet started formal work on the project," Lu said.

The fund, which is expected to pool between 500 million yuan (US$62million) and 1 billion yuan (US$124 million), will mainly invest in gold products traded on the Shanghai Gold Exchange, while investment in domestic and overseas gold futures markets will be the next step, according to International Finance News reports.

Currently, there is no gold futures trading in China, but industry participants and experts have long called for it in order to provide a hedging tool for gold miners, processors and traders.

The introduction of the proposed gold investment fund, analysts and experts say, will provide a boost to the gold market.

"The timing (of establishing the gold fund) couldn't be better as the recent gold price surge has caught the attention of investors, both incumbent and potential ones," said Cui Lin, a gold analyst with Antaike Information Technology Development Co Ltd, a Beijing-based metal industry consultancy.

"Investors' heightened attention will make it easy for the proposed fund to attract investment," said Cui.

The price of the metal, after topping US$500 per ounce last November, hit a 25-year high of US$574.6 an ounce earlier last week.

"The coming of institutional investors in the gold market is certainly a boost to its development, but the introduction of more products and market reforms is even more critical to the growth of the gold market," said Cui, the gold analyst.

The setting up of a gold fund will help spread gold investment awareness among China's affluent, which will help the emergence of a mature gold market, said Zhang Wexing, a gold investment expert.

"More people will become familiar with gold investment if a gold fund exists," he said.

"Only when more investors wade into the market will it become more active."

Gold, mainly used in jewellery and as an investment, fell 3.7 per cent in New York on Tuesday, its biggest one-day drop in nearly 13 years.

Gold price on Shanghai Gold Exchange witnessed small rise yesterday.

(China Daily 02/10/2006 page5)

GoldiloxShaken, not stirred#1415532/10/06; 09:25:45

Wow, with another 13 point hammering this morning, gold has become quite the "E" ticket ride.

One might think that the trade deficit numbers would work in gold's favor, but Wall Street seems to be locked in a fantasyworld unknown anywhere else outside of Orlando and Anaheim.

Oh, I get it - "Buy the bad news, sell the good". It might be a while before any of these idiots sell!

FlatlinerJust watching#1415542/10/06; 10:29:36

NYMEx Issues for February.

Silver 200 (Unchanged) or 1,000,000 ounces.
Gold 6,439 (up from 6,057) or 643,900 ounces (up from 605,700).

Total Eligible in golden warehouse 2,323,851 (up from 2,290,560). Total registered 5,063,549 (down from 5,086,510). Withdrawn 12,541 – HSBC bank USA.

TownCrierFed buying Treasuries, again#1415552/10/06; 10:48:55

After Wednesday's $1.25 billion coupon purchase, the Federal Reserve today was again busy in the open market making outright purchases of U.S. Treasuries, this time with a focus on Treasury bills maturing May to August 2006.

Perhaps its a bid to help trim the front end hump off of the yield curve, but whatever the case, the Fed newly created $1.244 billion in 'permanent' money in the course of making this purchase.

In unrelated action elsewhere in the world financial markets, new gold derivatives were just-as-easily "printed" out of the air and offered for sale, whereas not a single new gram of actual metal was able to be printed by anyone anywhere.

Lesson for the day -- choose metal. It'll reward you down the road like no paper promise or derivative ever can.


TownCrierPHYSICAL GOLD - WHY?#1415562/10/06; 11:04:36

The reason is risk of default. One of the patterns which recurs throughout history is that growing financial sophistication leads to widespread expansion of credit and exposure to default, and few people successfully avoid it when it matters.

Banks, pension savings, mortgage guarantors and all the major financial institutions on which we depend are now tied up in a web of undelivered assets.

'A' is the registered owner of a bond payable by B, the principal on which has been credit-swapped out to C. The terms are controlled by a deed drafted by an investment bank D, which itself receives the interest, which has been aggregated with 30 others and sold notionally to E.

'E' is foreign, and flattens the FX risk with a bank F, who sells and rolls a future on his long currency book, which is bought by another bank for an assured profit by running the position against a higher yield bond bought from a junk-status borrowing customer, which has been insured against the risk of default with G, a major insurer, who happens also to be A.

These are the styles of relationship which dominate the world in which ordinary peoples' savings are bound up ... we do not know when and where these webs will break, and, with the greatest possible respect, we don't think you do either.

But it is so certain that they will break, and at an unexpected place and time, that we believe every forward thinking person with a respectable private reserve would do well to opt out with at least part of their savings.

A purchase of gold is a good way to do this.

Gold accounts, indexes, spread bets, and futures all fail to extricate the buyer from the web of dependencies, because they are based on undelivered gold.

The only way to opt out of the web is to own physical property outright.

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

An emphasis on 'physical property' is nice to see, making the necessary distinction between safe solid savings as a counterpoint to the delicate web of ethereal money in which most people are too caught up.

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mikal@TC#1415592/10/06; 11:49:08

Re: Wilhelm- Part of my family tree
mikalLatin America's faltering foreign debt reliance#1415602/10/06; 12:29:38

Brazil Currency, Bonds Surge After Gov't Announces Debt Buyback - Bloomberg - 02/10/06 - Excerpt: "... Latin American countries from Mexico to Colombia to Argentina, awash in dollars from a surge in commodity exports and inflows to the region's local debt markets, have been buying back foreign debt. Argentina last month paid off its entire $9.5 billion debt with the International Monetary Fund, weeks after Brazil did the same. Colombia said yesterday it will pay as much as $1 billion of debt ahead of schedule this year.
The yield to the 2015 call date on Brazil's benchmark bond due in 2040 fell to 6.45 percent while the yield to maturity fell to 8.2 percent from 8.23 percent yesterday, according to JPMorgan Chase & Co. The bond's price, which moves inversely to the yield, rose 0.4 cent on the dollar to 131.95. It earlier climbed to 133.5, the highest price since the government issued the bond in August 2000.
The average gap between yields on Brazilian bonds and U.S. Treasuries fell to as low as 2.2 percentage points today, the smallest on record, according to JPMorgan's benchmark emerging- market index. Stocks also advanced today, pushing the benchmark Bovespa index up 0.5 percent..."

DDA Bigger Picture?#1415612/10/06; 12:33:04

Greetings All,

I don't think I've posted for 6-7 years, but I remain interested in the workings of our world and check in frequently on the lively and intellectually stimulating exchange of ideas here. I'm a business consultant teaching companies how to accelerate change using natural law and systems theory. Since it's been a while, I have a rather lengthy thought I'd like to share with you for your consideration.

Everything in human experience changes when we change the place from which we view it. For example, if I lose my job and can't find another source of income (assuming I'm an American with an average amount of savings in reserve – smile), I would probably experience being in what we might call a depression. If the major employer in the town shuts down and lays off half the town and I still have my job, then I might experience a recession. However, if either of these things happen in an over all good economy, from the point of view of the nation, things are good. From where we view things is critical to our experience.

There are natural laws that are valid and in play all the times and that are not, long term, subject to the whims or points of view of even the most powerful institutions, such as central bankers, governments, multinational corporations, powerful families pulling NWO strings and the like. Everything that happens in the universe can be viewed as interaction between various macro systems, subsystems, and micro systems. All systems, from the largest clusters of galaxies, to the FED, to you, to how you brush your teeth in the morning, are connected and influenced by all other systems. EVERYTHING can be defined as a system and therefore is subject to natural law. One such natural law is the Law of Dissipative Structures, which won its discoverer, Ilya Prigogine, a Nobel Prize. Basically the law says that all systems have a certain amount of energy coming into them and, as a stable system, the ability to dissipate a like amount of energy. However, any system that resists change in a changing environment increases complexity and requires more and more energy to stay the same. The resisting system can only dissipate energy at approximately the same level at which it was stable and so becomes stressed and moves toward instability. At some point the stresses become so large that the systems goes into a state called "reorder." It literally flies into chaos and, after a period of time, "reorders" into a completely new system that can dissipate the energy and the system again becomes stable. Importantly, once the system reaches a point of reorder, NOTHING can stop it. Not the Fed, not the government, not the PTB.

I believe that, based upon natural law and systems theory, we are entering a time of unprecedented change that will be led by the reordering of many of our largest and most intractable systems. I'll let you fill in the blanks on what systems you think might be at the breaking point and ready to move into reorder. A hint though. Think of systems that have been most resistant to change and that have become so complex and inefficient that they simply don't work as they were intended. Yikes! The list is long, yes?

Which brings me back to this honorable forum. One point of view is that there is a battle going on between the PTB and those who want honesty in some way (i.e. honest money ++). This battle may indeed be going on. However, from a wider perspective that includes natural law, change is coming that may well go beyond the monetary and win/lose economic systems to which we have become accustomed. We cannot know when this might happen, but that it will happen we can be assured. Even the most closed minds of men are not immune to the natural laws that govern our universe. It's easy to become fearful about the coming changes. However, it's not necessary. Once we have gone through our fears we will find an expanded sense of meaning and freedom. That's a good thing, yes?

Well, back to my cave. Hopefully I'll remember to poke my head out more often than every 6-7 years. Still, I'll be checking in with you to see how you view this incredible experience we call life.

With gratitude and respect,


mikalIndignant defense praises Australia Central Bank#1415622/10/06; 12:50:29,5744,18106836%255E31478,00.html

Let's Cut the Bullion About Holding Gold - Alan Wood - 2/10
Is this guy related to Tim? Here is a "spirited" defense of the Aussie CB and a one-sided slighting of gold. If he thinks the Aussie CB is under attack for selling gold now,
he ain't seen nothin yet. Perhaps they can survive the onslaught of barbs and arrows inside their brick fortress, waiting for a system-wide gold mark-to-market paradigm change.

TownCrier$550 is a nice solid figure to enter the weekend#1415632/10/06; 12:57:06

Speaking of solid, at current prices, a tidy pile just like this one can be yours for a ridiculously low number.

Call and inquire into an assortment of gold sovereigns, guilders, francs, kroners, pesos, rubles, lira, and marks -- portable property of your very own!


mikal@TC#1415642/10/06; 13:15:17

Re: My msg #141559 "Re: Wilhelm- Part of my family tree"
Perhaps I should have clarified. Besides owning the coin, and similar ones from Centennial and elsewhere, I believe there is some lineage connection. My brothers and I were told by my father before he passed that we were related to "the Kaiser". Because he had few details, in part due to the distance across the ocean to relatives in the Black Forest region, I assumed the link was indirect such as a distant cousin.
But dad passed away before I could inquire further and I made plans to hire a genealogist in the next year. I should also be able to travel to Germany to visit ancestral homes once the family tree is completed. Regards

Thoreauly@ DD#1415652/10/06; 13:17:30

Welcome back and very much appreciate your post.

I would simply say that since systems based on and operated in accordance with honesty, integrity, truthfulness, and the like are inherently stable, they are also the most adaptive and thus the most likely to stand the test of time. Conversely, since systems not based on and operated in accordance with these principles are inherently unstable, they are the least adaptive and thus the least likely to stand the test of time.

Since government fiat currencies fall into the latter category, we should not be surprised, then, to see their increasing instability approach the reorder stage a mere 35 years after their appearance, with gold standing rock-solid in the offing, ready to resume its age-old role as the foundation upon which a stable, highly adaptive socioeconomic structure can be built.

All would be well advised, then, to place themselves on that foundation as firmly as possible.

In other words, buy gold and fear not.

TownCriermikal,#1415662/10/06; 13:27:20

Thanks for the story. Given that background, I'm guessing you are nearly as fond of those particular coins as I always have been. The quality of craftsmanship in their design and minting is simply unsurpassed.

That isn't to say its peers from other nation-states don't rise to the occasion with their own degree of excellence in the minting arts, but for my taste the gold German marks have always been the greater among equals. And having said that, I'm reminded of the perfection of the Swiss coins, the Belgian, the French, the Dutch coins, the sovereigns...


mikal@DD, Comatose - Deficits balloon about to pop?#1415672/10/06; 13:42:05

"Published originally at : republication allowed with this notice and hyperlink intact."
The masters at hiding debt, the federal government and its loyal establishment news forces, are again showing us that when it comes to fraud they are not to be trifled with, they're the kings of the heap. Five months into fiscal 2006 without, as far as I know, yet having congressional approval for this year's budget, the clowns are already arguing over President Bush's proposed $2.77 trillion budget for 2007.
The surprising thing is that they are now predicting that this year's deficit for fiscal 2006 will be a record $423 billion. And that does not include the ninety-some billion they'll pilfer from Social Security which, by itself, will put us over the half trillion mark.
How's that for hiding a little debt? And this does not include further appropriations that always arise to fight the "insurgents" in Iraq and Afghanistan plus rebuilding efforts to keep Halliburton rolling in money. Nor does it include additional money for the already under funded rebuilding of New Orleans or the rest of the Gulf Coast whether outright funding or the support of the government's failing insurance companies like FEMA's flood insurance program. Even the Pension Benefit Guarantee Company (PBGC) should be included in this additional debt since it too is already $28 billion in the hole.
Add this all together and you've got a real deficit for 2006 close to six hundred billion, almost as much as our trade deficit.
And to think that when I was in market research, with a heavy emphasis on new product development, one of our slogans was that "price merchandising is the foothold of the incompetent," a slogan that WalMart has certainly proven wrong. Of course, that was back in the days when people wanted and were capable of buying hard goods that would last longer than their children's puberty period. Today, everything's temporary, even the 141 social programs Bush wants to cut in order to keep his deficits a bit lower. We are supposed to be thrilled by his plan to lower deficits (the way the government calculates them) to a mere two hundred billion by 2011. Can you accept that as an objective? Do you really believe the people of 2011 will wake up one day and say; wow, look at that, the deficit is only $200 billion?
It makes it pretty hard to believe that there was a time, not so long ago, when an eighteen billion deficit was considered a tragedy.
But times have changed, haven't they? For one thing, we were not engaged in a war between religious zealots on both sides. We had not yet been attacked by people willing to blow themselves up for the promise of seventeen vestal virgins waiting for them in the happy hunting grounds. And our young people were not coming home in body bags or minus arms and legs, with depleted uranium poisoning and mental instability – another perpetual unbudgeted expense along with failing veteran's insurance programs that are not counted in the deficit.
And what will George Bush, our compassionate conservative born-again Christian President, do with the savings garnered from cutting 141 social programs plus more borrowing from foreign countries? Well, he'll increase the military's half trillion budget, try to invade Iran or get Israel to make the first move, and sponsor a new H-Bomb project. Isn't that nice?
Unfortunately, older and wiser cultures are not going to let all of that happen even if the American public is complacent and cowered in too much fear to react. Iran, the country that already sells its oil to Russia and China is making noises about a "bourse" which means they are going to insist that the exchange be in euros instead of dollars, the same thing Saddam Hussein did in 2000.
And China, a country that has invested hundreds of billions in legitimate U.S. Treasury securities (loans) is making serious noises about abandoning the dollar and switching to a multitude of other currencies. The final step of cashing-in their treasuries will bring the American people to an immediate realization of how really bankrupt we are, especially when it's the American taxpayers who must come up with the cash – just as they will, and are doing, with all of the bogus trust funds that have been used to hoodwink and swindle the public.
In his pigheaded fanaticism, Bush is pushing the envelope. As Jack Denton put it; "It is economic stupidity to think that a nation can borrow itself into prosperity, and then tax the people to pay the principal and interest on the debt."
It's not only stupid, it's unsustainable. Someday, the piper will be paid. And that day may be much sooner and much more dramatic than expected.

TownCriermikal, The Australian msg#: 141562#1415682/10/06; 13:56:31

It's amazing to watch the extreme degree to which author Alan Wood can talk out of both sides of his mouth.

From one side of his mouth he says:

"Was the central bank wrong to sell the gold? I don't think so. Over the long term, say 20 years, its returns on its investments are odds-on to beat gold, and central banks are long-term investors."

In between (and absolutely wrong, I must point out) he says:

"Nor can the profit on gold be realised without selling it, and in what circumstances might a central bank do that?"

And from the other side of his mouth he says:

"With a floating exchange rate, international reserves play a much less important role, needed as a buffer only in extremis."

On the first point, central banks should NOT be viewed (by themselves or their goverments) as profit centers whose function is that of a "long-term investor" with a goal of profiteering. Such a view would lead to conflict of interest and ultimately to mission failure as the monetary custodian.

In the middle point, profit, again, is NOT the primary goal, but with that said, some central banks in the past seven years are learning how to become innovative in making productive use of revaluation accounts that accrue to them through the mark-to-market accounting principle of gold that needn't change ownership nor budge an inch from its place in the vault.

And finally, Alan Wood comes around to the important topic of the central bank's all-important role, along with their reserves -- "in extremis".

Here we must recall Alan Greenspan speaking to the US Congress in 1999: "Gold still represents the ultimate form of payment in the world. Fiat money, in extremis, is accepted by nobody. Gold is always accepted."

In this light, Wood's comments are to be seen as only so much bluster of disinformation [definitely NOT a public service announcement!]; simply part of the dollar/IMF bloc's coordinated attempt to throw cold water on the rise of the competing gold market.

Alan Wood concludes his remarks with the following:

"Don't forget the RBA's original justification for its gold sales - gold offers negligible diversification risk in Australia, with its large gold reserves and high annual production."

To my ears that sounds very much like a politically delicate way of conveying the stark reality that "in extremis" the gold in the ground and the production of the mines is always just an easy arms reach away from government control and seizure.

For all the right reasons of awareness and prudence, own the metal, not the mines.


melda laureDisorder, ordering, impoverishment, enrichment, entropy, extropy#1415692/10/06; 14:04:30

Indeed, sir DD!

The End of Certainty (Hardcover)
by Ilya Prigogine "Is the universe ruled by deterministic laws?..." (more)

Economics, Money, Energy, and Society... a messy mixture:

Modern Thermodynamics : From Heat Engines to Dissipative Structures (Paperback)
by Dilip Kondepudi, I. Prigogine "Adam Smith's Wealth of Nations was published in the year 1776, seven years after James Watt (1736-1819) obtained a patent for his version of the..." (more)

First the disordering, then, the reordering into a new world...

Advances in Chemical Physics: Modern Nonlinear Optics, Volume 119, Parts 1-3, 2nd Edition (Hardcover)
by I. Prigogine, Stuart A. Rice.

There are those who will belive what is in vol 119 (second edition) without having to buy their own copy- I did not think men were ready for this, but such things are not decided by me, thank goodness; Eru decrees, and the valar follow. But the risks are now extreme.

USAGOLD Daily Market ReportPage Update!#1415702/10/06; 14:56:37">
The Daily Gold Market Report has been updated.

If you are considering investments in gold we invite you to">request our free introductory information packet detailing the products and services offered by USAGOLD ~ Centennial Precious Metals. We welcome your inquiry and look forward to working with you.

FRIDAY Market Excerpts

Gold continues consolidation

February 10 (from MarketWatch) -- Gold futures closed down $14.60 an ounce Friday for a 3.2% loss on the week, resuming the consolidation trend that set in earlier in the week following recent quarter-century highs.

COMEX April gold contracts closed at $553, wiping out all of its more than $14 an ounce gains of the previous session.

Traders were unfazed, describing the movement as a normal pattern after the metal's bull run of the last six months.

"Since bottoming in 2001, gold has seen a two-steps-up, one-step-back rise, and Monday's big drop is nothing more than the start of the one-step-back part," said Peter Grandich, editor of the Grandich Letter.

Action Economics said a strong yen was also weighing on the metal. The yen rallied on strong Japanese data overnight, squeezing out some yen-funded margin long positions in gold. Volumes in Asia and Europe were lower than normal after what has been a volatile week for the metals market.

Analsyts agree that the selling has little to do with fundamentals which remain strong given the continued physical demand for gold in countries like China and India.

"A pullback to the lower part of the $500 will see the pent-up physical demand from India and other physical buyers return in force, but not chasing prices," predicts Julian Phillips, analyst at Goldforecaster.

At, analyst Peter Spina agreed, and said any selloffs in gold will find many willing buyers. Spina believes gold could eventually surpass $1,000 an ounce.

"One component of the bullish argument is the record-setting U.S. trade deficit data released this morning," he said.[The U.S. trade deficit widened 17.5 percent in 2005 to a record $725.76 billion.]

"This problem for the U.S. dollar continues to grow by the day and this just adds to the luster of gold."

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

SmeagolETFs - a ssnake in the grass?#1415712/10/06; 18:12:19

Sseems like gold ETFs are sspringing up like weeds. And everyone believes they are a good idea.

Why, we asks?

Ssnipped from Jim Sinclair's latest: "A year ago ETF's owned 170 tons of gold and now hold about 414 tons. That is a 170% increase in one year. Today ETF's are the 13th largest holder of gold. At the rate that they are growing they will continue to move up and in the not too distant future they will be one of the largest holders on earth."

This gives us pause. That's a LOT of Precious, precious. Way more than many Central Bankses. As we undersstands, ETFs issue "shares", each of which ssupposedly represents a quantity of It sstashed away in some secure (?) place.

We sseem to remember reading many articles recently about short sselling, and failure-to-delivers, involving... you guessed it, precious... SHARES!... and what those practices have wrought concerning certain companies. Like controlling them. Like running them into the ground. Like transferring lots of wealth in devious if not outright criminal ways.

As nothing has yet been done by the...sss... "authorities" to sstop these fraudulent practices, what is to sstop them from doing the ssame thing with gold ETF (and silver too, maybe, eh?) SHARES?

And has anyone noticed... ETFs are coming on-line jusst as things might be getting interessting in the metal exchanges...

We doesn't know about anyone else, but WE ssmells a rat. ~>8-(


Lackluster@DD#1415722/10/06; 18:15:23

Hello DD, I read with great interest your post below, in which you wrote "EVERYTHING can be defined as a system and therefore is subject to natural laws

Have you ever read any Wendell Berry? He is one of my favorite writers. His book "Life is a Miracle; An Essay against Modern Superstition" is essentially a critique of the thought I've quoted from your post. here is a brief snip from his book:

"If modern science is a religion, then one of its presiding deities must be Sherlock Holmes. To the modern scientist as to the great detective, every mystery is a problem, and every problem can be solved. A mystery can exist only because of human ignorance, and human ignorance is always remediable. The appropriate response is not deference or respect, let alone reverence, but pursuit of "the answer."

This pursuit, however, is properly scientific only so long as the mystery is empirically or rationally solvable. When a scientist denies or belittles a mystery that cannot be solved, then he or she is no longer within the bounds of science.

Thus, when Mr. Wilson asserts that "Paradise Lost" owes nothing to "God's guidance of Milton's thoughts, as the poet himself believed", he is talking far beyond the reach of proof. He does not consider that "Paradise Lost" is the poem it is because Milton was a man faithful and humble enough to invoke the assistance of the "Heav'nly Muse." The only empirical truth available here is that Milton, believing, wrote "Paradise Lost", and that Mr. Wilson, disbeleiving, wrote "Consilience," a book of a different order."

Here is another quote from the book, just to sort of link this post to gold:

"Science has to do, famously, with theory. "Theory," at root, is related to the word "theater"; it has to do with watching, with observation. It involves assumptions that appear to be consistent with known facts. it is not proven; it is useful because it may lead to evidence or to proofs.

Science also involves prediction. Prediction is a highly disciplined concept when it is used in relation to the methodology of proof: A thing is true only if it is predictably true, a thing is true, not because it is true now, but because it is true always. But in the hands of such "scientists" as meteorologists and economists, whose putative usefulness depends directly upon their ability to predict and whose predictions are frequently wrong, the meaning of prediction begins to slide toward journalism."

FWIW. A book I highly enjoyed, I encourage it for everyone.

SmeagolETFs - Things that (should) make you go "Hmmmm..."#1415732/10/06; 18:31:41

After our lasst Post we found this article and, ssnipped from it:

"If you follow the gold world closely, you will remember the enormous controversy the launch of this ETF generated. Some folks were thrilled that this gold ETF would open up gold to broader investor participation while others were convinced that it was a Trojan horse designed to suppress gold by shunting capital away from physical gold into yet another form of paper. GLD divided the gold camp like few other events, and very intelligent hardcore pro-gold people joined both sides of the raging debate."...

"ETFs are explicitly designed to track the price of their underlying assets. This is not an easy undertaking though. The underlying asset in this case, gold, has its own unique supply and demand profile that is independent from GLD's totally separate supply and demand dynamics. The only way that GLD can track gold is if the trust has an active connection to the physical gold world to stabilize supply and demand differentials between GLD and gold.

GLD's physical connection to equalize supply and demand is its ability to add to or shrink its gold holdings. Depending on the scenario, demand and supply are shunted from GLD to gold or vice versa as the ETF trust buys and sells gold occasionally to keep GLD tightly tracking gold prices. This is accomplished by the trust buying and selling gold "baskets" in the spot gold market. Each basket represents 10k oz of physical gold and 100k shares of GLD since GLD is supposed to track the price of 1/10th of an ounce of gold.

There are two primary scenarios to consider, GLD demand outstripping gold's and GLD supply exceeding gold's. In the first, American stock investors get excited about GLD and start bidding up its price. GLD starts to climb but gold may not be following if there isn't parallel physical gold demand. Soon the GLD price gets too high relative to gold and starts decoupling. The GLD ETF needs to shunt this stock demand into physical gold to equalize prices and maintain tracking.

"In order to accomplish this it issues new shares of GLD to soak up the excess demand and stabilize prices. With the capital that selling these new GLD shares nets, the trust goes out in the physical market and buys gold in 10k oz baskets for its London vaults. This process takes GLD demand and shunts it into the physical world by using this newly-issued stock capital to buy real gold."

"If you examine the last couple months or so in this chart above, this has just happened and it contributed to the most impressive gold upleg of this entire bull to date. As soon as gold broke $500 American investors naturally got excited and started pouring so much capital into GLD that it started to rise far faster than gold and threatened to decouple. The ETF trust had to issue more shares to keep GLD tracking gold and it used this capital to buy gold and radically ramp up the trust's vaulted London gold holdings.

While I certainly believe that the dawn of Stage Two global gold investment demand was the primary driver by far in this latest massive gold upleg, after studying this chart I believe that GLD was a peripheral factor too. From December 1st when gold first closed above $500 to its latest interim high of $572 on February 2nd, GLD's reported holdings rocketed up an enormous 114 tonnes, a massive 50%!

According to the World Gold Council, only 29 nations now report individual official gold reserves larger than this two-month GLD increase! And only 16 nations now hold more physical gold reserves than GLD!

And this is indeed the magic of the gold ETF, why I have been so excited about it for years now. Stock trading is the easiest and most developed form of trading in the world. And it is also a vastly larger market in capital terms than hard commodities futures. GLD enables American stock investors' demand and capital to be shunted into the physical gold world in a quick and painless way. It creates a conduit that allows vastly more capital to flood into gold than would trickle in via traditional futures or physical coins alone.

But this shunting should work both ways in theory, a double-edged sword. What if something, like a poorly performing gold price, made American GLD investors skittish and they started selling en masse. GLD prices would start to fall but the underlying physical gold market may not have similar selling pressure. This creates a problem for the ETF with GLD threatening to decouple to the downside. The only way to rectify this situation is for the trust to shunt the GLD supply into physical gold.

In order to arrest a unilateral GLD decline, the trust has to start buying back its own shares. But it generally doesn't have any cash so the only way it can raise the capital to purchase its shares is via selling 10k oz baskets of its physical gold. So it starts selling physical gold in London which puts pressure on spot gold prices. Then it takes this capital and buys back GLD shares, absorbing the GLD selling pressure. The GLD price soon stabilizes and tracks gold once again when the GLD supply pressure is equalized into physical.

Now during gold corrections I had expected this scenario to happen. GLD sales would be so high that the trust would have no choice but to sell physical gold and therefore increase downside gold volatility. Yet in the chart above this generally didn't happen. GLD's holdings were on a solid growth track with only occasional slight declines despite gold's lackluster and slumping behavior in the first half of 2005."...

More at link, of coursse...

Are ETFs a case of "meet the new boss, ssame as the old boss?" We doesn't trusst them, O no precious! ~>8-(


Flatliner@ETFs#1415742/10/06; 18:47:28

Smeagol, If ETFs where a way to get to precious, ‘Big Trader’ would use ETFs. If the futures market where a way to get to precious, ‘Big Trader’ would use the futures market.

There is no place on earth big enough to satisfy ‘Big Trader's desire for that most precious. ‘Big Trader’ is – locked out.

There are those that understand physical and there are those that do not.

We watch, as we are told that the precious yellow metal flows into vaults under the care of ETFs, but we know that this is not true. If it were true, ‘Big Trader’ would have already done this.

ETFs are a side show.

DruidETF's...#1415752/10/06; 19:01:08

Druid: ..are another layer of the paper onion representing a perceived value that buys the giants more time to position themselves for the ongoing transition to a revalued gold bullion price.
FlatlinerFollow up#1415762/10/06; 19:13:16

Where does Russia go to shop for gold when they say they want to double their gold reserve?

A)The futures market?
D)Bullion Dealers/jewelers?

Russia is a ‘Big Trader’ and their actions show that they are locked out of the market. Unless we hear that they've suddenly doubled their physical gold holdings, then there is no way to fill a Big Trade in the markets today. It's not possible. There is only one answer in the list above and it requires time.

Driuds comment hits it directly. The entire world is google-e-eyed over gold right now so ETFs are popping up everywhere as a black hole for that money.

The next big challenge for those that fight for the freedom of gold will be to educate the public. How does one teach someone the concept of physical verses derivative version of gold?

I would be willing to go as far as to say that ETFs could spell the end of the Freegold concept. We need to watch India and China here. We all know that they buy tonnes of gold, if that money is diverted, physical demand will dry up a TPTB will be able to maintain control.


Belgian seemed to fight for physical all the time. Maybe he understood this?

TownCrierSmeagol, on ETFs...#1415772/10/06; 19:20:25

Here's a day in the archives that stands out more than others on this particular topic.


GoldiloxRussia's methods and Latin Anerican foreign debt retirement#1415782/10/06; 20:51:07

@ Flatliner

I think Russia showed its options pretty openly in the Yukos affair. Not unlike Chavez' willingness to divest foreign investors, if they need the gold, they will buy it fom their own miners at their price, foreign "investors" be damned.

I was intrigued by mikal's post about Latin American debt retirement. It looks like a lot of the world is struggling to loosen the IMF/WB shackles on their local resources, and an economic rebellion in the Monroe Doctrine colonies would spell disaster to the US plantation owners - Buckley's, Exxon, etc.

It will be interesting to watch the NeoCon response (through their WB minion Wolfowitz, and the NED 'National Endowment for Democracy'). US attitudes about Latin America have been prepped by the phony "War on [for] Drugs" for decades, while "Give 'em Hell, Ollie" and his bosses in the Mena gang have quietly controlled much of the illicit flow.

Ten BearsCoffee cup debates#1415792/10/06; 22:17:29

Gold ETF primary market issuers and secondary market sellers….Gold ETF's use investors’ money to purchase gold. Investors sell their ETF shares in a secondary market to other investors. Adam Hamilton notes that the issuers of ETF's will sell real gold into the market if ETF share prices fall. Perhaps not; after all, they have purchased gold with OPM (other people's money). Short sellers, or a panic, could drive down the price of ETF's and to some extent, lower real gold prices. Perhaps someone knows of some legality that governs these gold derivatives which would prevent the above described scenario?

From my perspective, the ETF's may be a way for a "big trader" to accumulate a substantial gold stock pile using investors money without a requirement to distribute the gold to those investors.

Or, to quote the archival post referred to by TC, " If anyone can successfully convince me that a bank *CAN'T* (at least once in awhile and at the most opportune moments) muster what it takes to control the price of its own product in such a way to manipulate investor/depositor/public sentiment, then I'm a monkey".

The Invisible HandG8 in Moscow this week-end#1415802/11/06; 01:22:09

G8 finance chiefs prepare for a weekend of meetings in Moscow with energy security at the top of their agenda.
As energy importers, most of the G8 members are alarmed by the way oil and gas prices have been sent rocketing by record demand and political instability in places such as Iraq, Iran and Nigeria.
They have seen rising fuel prices stoke inflation, pushing up business costs and dampening consumer spending
And they have noticed that rising energy prices have been good for Russia which has big reserves of oil and gas

Iran's euro-denominated oil bourse to open in March: US Dollar Crisis on the Horizon
by William R. Clark
February 10, 2006
"A successful Iranian bourse will solidify the petroeuro as an alternative oil transaction currency, and thereby end the petrodollar's hegemonic status as the monopoly oil currency. Therefore, a graduated approach is needed to avoid precipitous U.S. economic dislocations."
"This notion that the United States is getting ready to attack Iran is simply ridiculous... Having said that, all options are on the table."
-- George W. Bush, February 2005

GoldiloxIs the Party Really Over for the RE boom?#1415812/11/06; 02:07:51


Anyone who has been reading the newspaper these days has to be nervous about the state of the housing market. Let's look at the statistics: According to the National Association of Realtors, existing-home sales are expected to decline 4.7% to 6.74 million this year, down from a record 7.07 million units in 2005. New-home sales are expected to fall 8.5% to 1.17 million from a record 1.28 million last year. The trade group predicts housing starts, or the number of new homes built, will reach 1.87 million units this year, down 9.3% from the year earlier. The national median existing-home price for all housing types is expected to increase 5% this year to $219,200, while median new-home prices are projected to rise 5.7% to $250,900. That's about half the rate of home-price increases last year. Meanwhile, this week, Toll Brothers, a leading luxury home builder, slashed its sales forecast for the second time in three months, while the Mortgage Bankers Association announced that mortgage activity declined for the second straight week, as 30-year fixed interest rates hit 6.25%, their highest level since early December.

Sort of sounds like the party is over, doesn't it?

But wait, there's more: Data keepers in your part of the world aren't too cheery, either. DataQuick Information Systems, a La Jolla, Calif., information provider, recently reported that foreclosure activity is on the rise throughout the state. In the Bay area, foreclosures rose 10.5% in the fourth quarter of 2005 over the year before, due to slowing housing-price appreciation. People can no longer expect rising home equity to bail them out when they lose their jobs, divorce or suffer other kinds of financial reversals, the company says. The California Association of Realtors reported that existing home sales in the state decreased 17.6% in December from the same month a year earlier.


Being a RE trade rag, the author trots out the tired apologetics that "the RE market is really local and blah, blah, blah . . ." but the numbers speak for themselves.

The Invisible HandContrarian, is that you?#1415822/11/06; 02:22:47

February 10, 2006
A Note On The Iranian Oil Bourse
By Paul Craig Roberts
Readers keep asking if Bush is attacking Iran because it plans to open an oil bourse that would permit oil to trade in Euros. A number of readers mistakenly believe that this would wreck the dollar's value.
The answer is no.

GoldiloxUS official admits Iraq aid theft#1415832/11/06; 02:44:23


In the United States, a former official has admitted stealing millions of dollars meant for the reconstruction of Iraq. Robert Stein held a senior position in the Coalition Provisional Authority, which administered Iraq after American and allied forces invaded in 2003.

In a Washington court, he admitted to stealing more than $2m (£1.12m) and taking bribes in return for contracts.

He faces a maximum sentence of 30 years in prison.

Robert Stein's story is one of extraordinary corruption and excess amid the ruins of Iraq. He was in charge of overseeing money for the rebuilding of shattered infrastructure in south-central Iraq in 2003 and 2004.

Suitcases of cash

Mr Stein admitted in court to conspiring to give out contracts worth $8m to a certain company in return for bribes. He also received gifts and sexual favours lavished on him at a special villa in Baghdad. But it didn't stop there.

Robert Stein admitted to stealing $2m from reconstruction funds.

Some of that money, the court heard, was smuggled onto aircraft and flown back to the United States in suitcases.

The case is an ugly twist in the tale of post-war Iraq.

The Coalition Provisional Authority, which ceased to exist in 2004, has already endured some tough criticism over the way it managed funds and handed out contracts.

A report from the Special Inspector General for Iraq Reconstruction on how the authority went about its business is expected in the coming weeks.

The signs are it could make embarrassing reading for many of those involved.


Coalition dominoes are starting to fall, which cannot be food news for the occupation forces. First the UN Oil for Food, and now the CPA, it's getting ugly for the architects and executors of this "moral" cause. . . not just theft, but "sexual favors" and international money laundering. How well the "damage control team" shields the White House and the VP's Halliburton from fallout remains to be seen, but could bode heavily on the November elections.

So far, Rove has done a good job of parrying the Gay-gate thingy, as support from the conservative religious right usually undergoes rapid and complete sublimaton where libidos get involved, so added sordities cannot be welcome.

I wonder if this signals the web bot prediction of "religious upheaval" in Washington.

Off-topic, except that Washington solidarity and "full faith and credit" are at stake during a most vulnerable time for the dollar.

The Invisible HandWe're no lunatics anymore!#1415842/11/06; 03:50:02

Even Wikipedia, the free encyclopedia, has noticed

SNIPS from Wikipedia's "Petroeuro" entry:

On March 20, 2006, Iran is planning to open an International Oil Bourse (IOB, exchange) for the express purpose of trading oil priced in other currencies, including Euros.
The United States Federal Reserve (the Fed) has announced that it will stop reporting the M3 money supply data of the US dollar on March 23, 2006. This has started some speculation in the investment and banking community on the possible instability in the dollar system that the Fed is trying to hide.

GoldiloxThe Backwards Conspiracy#1415872/11/06; 08:43:21

This is to me is NOT conjecture. It is one of the reasons I had the courage to say what was published in my career review in Forbes of December 2001. Every fundamental supports a much higher price for gold, yet there has never been a market that was not made to do what it does. The only manipulation that has ever worked is manipulation that is parallel to the direction that a market wants to go anyway. This is called sponsorship and is required in every situation. What we will discuss here is the sponsorship for gold to $1650 or higher. The direction gold wants to go is up, and that up is going to be taken full advantage of in amounts that are in the trillions.

Those of you that see the easy answer to gold's problems in the word "conspiracy" have it backwards. You see the intent as anti-gold. I have received copious numbers of faxes and emails chewing me out for what is interpreted as not seeing the evil intent in gold ETFs, pointing to the custodians as proof of the dirty deed.
Lets work through this together using logic and fact:

Almost all major gold producers are using over the counter derivatives of one variety or another. They inform you they do not have margin calls and can roll their deliveries forward with the buyer.

We have analyzed the margin call characteristics of over the counter short of gold derivatives almost to death. There is a tie between the gold derivative, the condition of the balance sheet and the bond ratings of the producer which could trigger an event that mirrors a margin call. That may not be named as a call based on a margin, but in practice that is exactly what it is. This factor does not fit into the scenario until well down the road to $1,650 - if at that point at all.

Looking at the form of over-the-counter short of gold derivatives, you have to come to the conclusion that the producers have found a trillionaire that is both clinically insane and actually has the money to make these contracts as the buyer in the short of gold derivatives. In any contract there is a buyer and a seller. The non-recourse loan requires the short of gold over-the-counter derivatives. It is the buyer in this situation we need to examine in order to know what is really happening. This is something no one has done. The buyer is not a certifiable nut who is a trillionaire. He is a singular, cunning, smart international group. His nickname is Daddy Warbucks, followed by Daddy Warbucks’ gang. The assumption that the buyer in the transaction is in a nut house is illogical.

The conclusion that efforts like today to pound the rear end off gold at any opportunity are to cover short positions profitably. There is some of that out there, but the short continues all the way from $248 to the present level. You can conclude the best traders in the world are numskulls of world class character. What is happening is called "shaking the tree so the apples will fall."
With the dangers now well known in the non-recourse borrowing for production loans, every new project is financed this way. You say that the oxymoron in the gold mining industry is the word "management." Today the largest companies are run by modern Authoritarian Free Enterprise which are generally financial and accounting people. If not run by them, they are the back up teams to CEOs and Chairmen. Companies with a billion dollars in the treasury and those that made two billion short gold in the bear market are not neophytes even if we disagree with them.

We assume that companies that scored big time in the gold bear market are a pack of idiots that have not perceived the gold bull market as clearly as they perceived the bear market.

The fact is we have out there a perfect classical case study of derivative failure right in front of your eyes screaming for your review. But how many of you have used the amazing tools of the Internet to review all articles and announcements on the Ashanti Derivative problem. My guess is no more than one in a thousand readers has taken the time to make this review.

All your answers are staring you in the face as a matter of history which went into a cement foundation due to the miracle of the Internet. It is there for those that know how to browse thoroughly. Yet there remains a pertinent fact yet to be defined. The important yet unanswered fact is this question: When Ashanti was diluted in the process of paying out shares of stock for the purpose of meeting the exotic over the counter derivatives that went totally bad were contracts closed or are they still on? Mark my words carefully. We are about to find out soon.

If we find out that the answer to the question concerning whether or not those deadly contracts were closed by the payment of shares of Ashanti which went down the line to the buyers of the gold on the OTC derivatives, we will have in the hand the fact most important to this line of reasoning some call a CONSPIRACY, but which I believe you have defined totally backwards. You call this CONSPIRACY with the interpretation of illegality which it is NOT under present law.

You also really believe that there are many entities making these short of gold derivative contracts as the buyers of the contract on the long side. The tenets of the specific performance contract known as OTC short of gold derivatives would indicate the buyer never wants the gold and is willing to take infinite risk. This is going back to the point that the long side or the short of gold derivative must be a certified mad person presently in a mental ward without a conservator.

Now let's look at all this from a different angle. What if the long side of all these short of gold derivative that allows the non recourse loan was a singular entity, in fact Daddy Warbucks and his Warbucks' friends? Let's say that all these loans from the international corporation are controlled by Daddy Warbucks and Daddy Warbucks’ buddies. These loans are made via Grand Cayman corporations to major producers who also have corporate subsidiaries in tax sheltered domiciles. There is no crime here, just a layer of privacy.

Let us take this story a little further and assume that one or two major gold producers were going to consolidate the entire gold production industry by buying all the for sale major producers and/or the subsidiary corporations of holding companies that are gold producers.

Now assume that between 2008 and 2010 these final consolidators of the many bags of derivative ruined gold producers was to experience the same situation as Ashanti did. The outcome is clear. As the shares are issued to meet the debits, the final entity to receive these shares would be the long side of the short of gold derivatives that have allowed the huge expansion of non economic new production in the 1990s as well as production from 2000 to present.

The plan is so perfect that the shareholders of the acquired companies are quite happy with the price received. Gold will be so high by the time that the final public gold producing consolidators of the gold industry will be so watered down that the shareholder of this company or companies will have profits regardless of the water down that will keep them happy as clams in mud.

Now assume for a moment that the majority of ETFs with their extreme expansion to come are, in the main (of course not all), the tool of Daddy Warbucks and the Warbucks’ gang to take up excess supply of gold before the gold fever really takes over all the black boxes so perfectly explained by Dan last evening.

The ETFs or a fund of gold is so enticing I am presently speaking to Monty Guild and our inside gold associates about establishing a gold community fund because we are the top guns of this business with real experience, not Parker Pen experience.

Not to be concerned, my public company is number one in the line of my focus and responsibilities and that will NOT change under any circumstances.

So here is the bottom line. The agreement amongst major investors, a legal conspiracy if you will, is NOT to depress the price of gold but to own it ALL. I mean all! Thanks to the black boxes, watered down major producers and ETFs the price of gold will go to unimaginable levels by 2012.

This is why no reaction should concern you. This is why the top callers are witting or unwitting allies of Daddy Warbucks. This is why I buy all reactions selling 1/3 into all periods of strength. This is why worry is not part of my gold vocabulary. This is why I have quoted you the words of the old New Orleans spiritual, "I will NOT be Moved."

You should not be moved by this week's action in gold. It is all part of what a move to major prices is made of. I expect tons of email attacking this viewpoint, but I am totally CORRECT. You will see all I have just told you unfold in front of your eyes and over this generational bull market in gold.

The final act in this story will be the reinstitution of a modernized Federal Reserve Gold Certificate Ratio tied to international liquidity and the price of gold. This is the vehicle by which gold will find its way back into the depressed but low dollar in order to guarantee Daddy Warbucks and its gang that that de facto ownership of the world's supply and oncoming new world supply stays at the high price accomplished in this magnificent and legal plan.


Sinclair outlines what he calls "The plan to own it all," including the shorts and ETF as vehicles.

USAGOLD / Centennial Precious Metals, Inc.A combo of assets and info to help you get started on the right foot#1415882/11/06; 12:29:29">gold ownership starter kit
Caradoc@Goldilox#1415892/11/06; 12:42:42

As I understand Sinclair's previous postings on most miners being subject to what anmounts to a margin call on a short-of-gold position, it derives (hate that word!) from two things:
1. Miners need to raise funds for their various projects and end up borrowing the money. Naturally, any entity loaning money to a gold miner is at risk in case gold goes down and covers that risk by going short on gold with the value of that short position written in as part of the relationship between lender and borrower. To expect otherwise would mean expecting to find capital from a lender who's not afraid of risk. Not real likely.
2. Accounting rules require that the credits and debits of any so-called "non-recourse" loan (i.e., one where the lender has no security from the borrower except the value of the project being financed) include the value of the lender's short position which he has taken to protect himself as a debit or credit at the project level (not at the corporate level).

Putting these two things together, and as was the case with Ashanti, when gold surges the value of the short position drops and on paper (which is the only reality that counts here), the value of the project drops even though the project itself may be doing well. Upshot of all this -- as previously predicted by Sinclair -- will be that when gold is at some lofty number, gold shares of most miners will be trading for less than what investors might have been hoped for because miners will have watered down their shares to pay their way out of the short position.

Sinclair's new post adds/refines/changes a few things:
* Rather than leave us wondering whether the predicted state of affairs could kick in at $800 or $1000 per ounce, Sinclair now indicates the problem won't strike until well toward $1,650.
* For the first time, he mentions the same problem with silver miners.
* Also for the first time, he presents the short-of-gold problem in the context of the ongoing consolidation of the gold mining industry, raising for me the idea that mergers will be arranged so as to spread out the short positions in the same way that a consortium of banks each get their fair share of bad loans when taking over the assets of a failed bank.
* This parceling out of the bad news may explain why he adds "if at all" to his prediction when his previous postings made it sound inevitable.
* The biggest single news in his new post -- which could be seen as a 180-degree reversal -- is the prospect that even if the watering down of share value does happen, share prices will have increased so dramatically that investors will be "as happy as clams in mud," hardly noticing that their equity positions could have pencilled out even higher. The flavor that comes through is "Gee, my investment went up by less than two orders of magnitude. It could have been almost three orders of magnitude if it hadn't been for those pesky loans."

With Microsoft and other blue chips each having a market cap bigger than what would be needed to buy every gold and silver share on the planet at current prices, it's logical that if/when 5 or 10% of that capital sloshes in the direction of the mining industry with its limited number of shares and the physical metal with its limited number of ounces, the supply/demand situation would dictate phenomenal increases.

Would appreciate your thoughts on whether/when worldwide capital sloshes in our direction. I'm thinking of a two pronged trigger: either enough time for gold to be rising through low 700s with much talk of taking out $800 or (regardless of how soon) some geopolitical event nasty enough to send people in search of security.

One thing that Sinclair has never mentioned is the identity of those miners who have avoided signing up for the so-called non-recourse loans. My list would include cash-rich Goldcorp, Royal Gold, Glamis, and Sinclair's own Tan Range.

Your thoughts?


TownCrierG-8: Japan urges Russia to ensure energy security (plus forex news)#1415902/11/06; 13:45:58

MOSCOW, Feb 11 (Reuters) - Group of Eight finance ministers met in the Russian capital and sounded the alarm over the cost of energy, urging greater international cooperation to ensure stable supplies.

"This time, we had various discussions on the oil price problem. But we see no sign that the high level of oil prices is making a direct influence on G8 economies. We agreed on this point," Japanese Finance Minister Sadakazu Tanigaki told a news conference.

...Tanigaki said that Russia had not raised the issue at this G8 gathering of its desire to join the meeting of G7 finance ministers and central bankers.

"There wasn't any mention this time from Russia that it wants to join a meeting of G7 finance ministers and central bankers," he said.

A senior Japanese finance ministry official said on Friday the Group of Seven rich nations is not ready to add Russia to its club because of differences including one over foreign exchange.

G7 finance ministers and central bankers usually gather in February to discuss the world economy and exchange rates. Under Russia's presidency this year however, central bankers were not present at the weekend's meeting in Moscow.

Tanigaki said the G8 had no discussion on foreign exchange.

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

Going out on a limb here, what has recently been the noteworthy foreign exchange issue regarding Russia?

Answer -- In mid-November we reported the following news item:

HEADLINE: Russian Central Bank may double proportion of gold reserves
(RI 11/15) -- ...The change was part of an ongoing effort to optimize the composition of assets and reserves managed by the bank. The bank is also encouraging the development of the Russian domestic gold market to be a fully functioning financial market akin to bonds and currencies. Russia presently has 500 tonnes of gold in reserves, the envisaged doubling as a proportion of all reserves at present values would consume all the country's annual gold output for around three years.

One week later president V. Putin said "I think that the CB should pay more attention to precious metals on Russian territory when forming its gold and foreign-exchange reserves. ... The reserves are, after all, gold and forex reserves. Let's not be too restrained here."

And then two days later First Deputy Chairman of the Russian Central Bank Alexei Ulyukayev said the bank would be purchasing gold "on all markets on which it is available," meaning both domestic and foreign markets.

And to wrap this up, as I reiterated just a few days ago, Russia in the month of December had taken a modest step and added ten thousand ounces to the gold portion of its foreign exchange holdings, and effective January 1st, 2006 it had begun the accounting principle of marking those reserves to market value -- at odds with the frozen-price principle of dollar-IMF system (which Japan also uses).


mikalAussie commodities strategist talks gold#1415912/11/06; 14:25:40,7034,18116168%255E951,00.html

Gold "set to bounce back" - Alex Wilson - 02/12
specie-manBond "Conundrum"#1415922/11/06; 14:42:10

Mikal reported:

>Brazil Currency, Bonds Surge After Gov't Announces
>Debt Buyback - Bloomberg - 02/10/06 - Excerpt: "...
>Latin American countries from Mexico to Colombia to
>Argentina, awash in dollars from a surge in commodity
>exports and inflows to the region's local debt markets,
>have been buying back foreign debt. Argentina last month
>paid off its entire $9.5 billion debt with the
>International Monetary Fund, weeks after Brazil did the
>same. Colombia said yesterday it will pay as much as $1
>billion of debt ahead of schedule this year.

And there it is in plain sight ... the answer to the bond "conundrum" !

During inflationary times, one would expect long-term interest rates to go up along with short-term interest rates. But inflated commodity prices are allowing countries to retire their debts at an accelerated pace, thus resulting in lower long-term rates.

The US Government has been doing most of their deficit borrowing at the short end of the bond duration (and thus, the relatively high short-term rates). But it looks like they are now migrating to longer-term financing (now that the 30-year bond sales have been revived).
As a result, the yield curve will not become significantly inverted.

More and more world-wide entities are electing to opt-out of the Dollar regime. So the US Goverment will step into the void and become the borrower of last resort.

GoldiloxSinclair Analysis#1415942/11/06; 15:17:14

@ Caradoc,

I think you found some interesting chinks in JS' armor, though they hardly indicate he is on the wrong track - perhaps more likely that he is seeing TPTB manage the transition better than previously suspected.

Don't know enough mining balance sheets to comment, but your short list is probably a good one. Hommelberg and others offer more complete company analyses.

One does have to consider how potential hyper-inflationary growth in energy and transport prices affect the margins for miners.

I think they will do better than 2:1, as most have already demonstrated that, but how will the cost balloons hit their botom line?

As far as share watering, I have never seen a publicly held company who didn't salivate at the the opportunity to dilute shares, as they always reallocate executive holdings when they do it. Non-insiders have to hope the gains will overshadow their greedy dilutions.

Consolidations are often the opportunity to effect dilutions with the merger used to divert attention from the share dilution.

It's certainly more complex than managing gold-in-hand.

Clink!@ Caradoc, Goldilox#1415962/11/06; 18:18:00

One aspect of Sinclair's analysis which struck me while reading it, is that many of us, GATA particularly, have been wondering how the commercial shorts are going to cover their losses as the POG rises, and also, in the face of what seems like an inexorable rise, why would they be going short anyway ? Well, maybe they don't care, as they see that the rise will place the ownership of the miners in their hands. They may lose some paper, but they will end up with control of the physical. Comments ?

GoldiloxPaper losses#1415972/11/06; 18:42:19

@ Clink, Caradoc,

If they're gonna bring paper to its knees, anyway, why not?

I have always maintained that the real motivation behind the bubble, the ENRON demise, and subsequent energy and RE bubbles is ALL about political control, where the current currency (be it dollars, euros, physical, oil, etc.. ) is immaterial, as long as the "cash flow" remains in the "right" hands. Greenapn is absolutely lying when he says he couldn't see the bubbles coming. Everyone did! The Caribbean banks house their ill-gotten gains to maintain PPT cash flows beyond US oversight.

It also lends a slightly different coloration to the Middle-East oil battles. They could stay as culturally bass-ackwards as they wanted to be, in fact we fed them arms for their turf wars, as long as the oil flowed where the oil barons wanted it through the dictators and phony "Royal Families". We even fed arms to both sides of the Iran-Iraq war, with Rummy supporting Saddam, while Ollie armed the Iranians.

The dot.coms burst because, as Jack Welch put it, "I'm sure as Hell not gonna put GE's supply chain in the hands of some San Francisco kid with a ring in his nose." The obvious answer was to let the technology develop to a certain maturity, short them to death on Wall St., buy the skeletons of intellectual property, and ship it off to India under the control of the traditional brick and mortar barons. In the process, it might wipe out a few million 401Ks and gut the US information technology industrial base, but that's just "collateral damage".

As Jim reminds us, the authors of "Authoriarian Free Enterprise" are not stoopid people, so why should gold fare any differently in their hands?

The Invisible HandThe bombing of the IOB#1415982/11/06; 23:38:47;jsessionid=W0OEGSDXOHUEHQFIQMFSFF4AVCBQ0IV0?xml=/news/2006/02/12/wiran12.xml&sSheet=/portal/2006/02/12/ixportaltop.html

Iran threatens the dollar with its Oil Bourse?
No problem, "we" 'll "just" bomb it.;jsessionid=W0OEGSDXOHUEHQFIQMFSFF4AVCBQ0IV0?xml=/news/2006/02/12/wiran12.xml&sSheet=/portal/2006/02/12/ixportaltop.html

US prepares military blitz against Iran's nuclear sites
By Philip Sherwell in Washington
(Filed: 12/02/2006)

Strategists at the Pentagon are drawing up plans for devastating bombing raids backed by submarine-launched ballistic missile attacks against Iran's nuclear sites as a "last resort" to block Teheran's efforts to develop an atomic bomb.
Central Command and Strategic Command planners are identifying targets, assessing weapon-loads and working on logistics for an operation, the Sunday Telegraph has learnt.

contrarianJack Welch and dot coms#1415992/12/06; 00:19:41

Goldilox--very astute observation. Where did Jack Welch say this about the dot coms? Link? Book? Want to read more! Thanks!
GoldiloxWelch Quote#1416002/12/06; 08:15:05

@ contrarian,

Heard it from my old boss, so it probably has a life of its own, by now, but no exact reference.

It is interesting that GE set up "accent schools" for Indian phone technicians in 2002, where they taught New England, Southern Drawl, and West Coast, so they either foresaw this shift or reacted very quickly.

Of course, they have their astute "investigators" at CNBC on the front lines. LOL

GoldiloxNukes or gold?#1416012/12/06; 09:00:01

@ TIH,

Compare the Israeli "surgical" strike on the Iraqi nuke plant with the Shock and Awe of Rummy's "smart bombs," which took out 50K-100K civilians, hospitals, museums, and schools, but still managed to leave Saddam and his palaces, the "intended targets," unscathed.

Unless the goal is complete destruction of the Iranian infrastructure so Halliburton. et al, can enjoy some more "no-bid" contracts, it would be cleaner and cheaper to send in a squadron of Isreali jets with "dumb" bombs.

Two generations later, farmers in Washington, Idaho, and Utah are still suffering from leak damage at Hanford, which was never bombed, so the collateral damage from more radioactive refuse in the Asian atmosphere is likely provide "collateral damage" all the way into China.

No one is even considering bombing the North Korean reactor that Rummy so greefullly sold them and they publicly brag has produced nuclear weapons. Is all this hullabaloo really about the spread of nuclear technology, or actually about the spread of of gold?

With Iraq and Malaysia/Indonesia down for the count, Iran is the only remaining major proponent of the Islamic Gold Dinar. For those whose only reality is TV news, and immediately assume gold is unrelated to this discussion, think about that for a moment. Even Sinclair, who used to talk about the IGD regularly, has been completely mum for at least a year, although the complete destruction of IGD proponents certainly fits his "Authoritarian Free Enterprise" scenario.

Cometosegreenspan acting up : bored now that he's out of control#1416022/12/06; 10:18:05

I mean : Now that he is out of control of the fed;


go down to the part about Greenspan's goof after the first paragraph :
Former Federal Reserve Chairman Alan Greenspan's appearance, for a $250,000 honorarium, at a Lehman Brothers secret dinner in Manhattan last Tuesday created dismay among his former colleagues at the Fed.

Published reports indicated that Greenspan alerted Lehman partners and clients that the markets are underestimating future Fed interest rate increases. Such hints would violate the central bank's rules. Fed sources also say Greenspan broke from past practice by chairing the last meeting of the Federal Open Market Committee after his departure date had been announced.

Greenspan's alleged comments were leaked to the news media by a Lehman Brothers official who was not invited to dinner.

USAGOLD / Centennial Precious Metals, Inc.USAGOLD puts a world of gold at your fingertips...#1416032/12/06; 12:04:53">gold -- a global calling card
mikalAccounting rules on trial #1416042/12/06; 17:13:38

Conditions still ripe for ... another Enron? - 02/12/06 - Washington Post
DruidA Note On The Iranian Oil Bourse#1416052/12/06; 17:17:49


"By Paul Craig Roberts

Readers keep asking if Bush is attacking Iran because it plans to open an oil bourse that would permit oil to trade in Euros. A number of readers mistakenly believe that this would wreck the dollar's value.

The answer is no.

The neocons’ plans for the Middle East predate any notion of an Iranian oil bourse.

Will an Iranian oil bourse hurt the dollar? Not really.

The dollar's value depends on the world's willingness to hold dollar denominated assets, not on the currency used to pay oil bills. If payments were not made in dollars, there could be a slight negative impact on the dollar from countries reducing their dollar cash balances and from the psychological shock of pricing oil in Euros (or some other currency). However, what really counts is what do the oil producers, for example, do with the currency that they are paid. If they are paid in dollars, but exchange the dollars for Euros or Yen and purchase equities or bonds or real estate in Europe and Japan, it doesn't help that oil is billed in dollars. Or if they are paid in Euros but exchange the Euros for dollars and purchase US assets, it doesn't hurt that the oil is billed in Euros.

The negative impact on the dollar will be far greater from the additional red ink necessary to finance an attack on Iran than from an oil bourse. Today, US war making capability is dependent on the rest of the world to finance it.

Oil is billed in dollars because the dollar is the world reserve currency. The dollar is not the reserve currency because oil is billed in dollars. The US is abusing the dollar's role as reserve currency. When a trusted alternative appears, the dollar is likely to lose its reserve currency role. Iran, however, cannot cause that transition."


Paul Craig Roberts [email him] is the author with Lawrence M. Stratton of The Tyranny of Good Intentions : How Prosecutors and Bureaucrats Are Trampling the Constitution in the Name of Justice. Click here for Peter Brimelow's Forbes Magazine interview with Roberts about the recent epidemic of prosecutorial misconduct.

Druid: I really enjoy reading this Author's comments but I have to respectfully disagree with his comments concerning this potential event as it pertains to the dollar/oil exchange arrangement. It's not that such a trivial act of substituting one currency for any other can't be done as easily as creating such currencies out of thin air via computer digital entries. No, It's about trying to match value for value in completion of a trade as dictated by scarce resources for that exchange.

contrarianEuro Oil Bourse#1416062/12/06; 17:46:14

I do concur with you Druid that opening of oil bourse is like the boy with his thumb preventing the dam from flooding, and must be stopped at all costs. All we have to do is look at what happened to Iraq, and how now Iraqi oil is traded in dollars.

Here's an article supporting this opinion.

contrariananother article re Euro oil bourse#1416072/12/06; 17:47:08

Here's another article.
GoldendomeContrarian-- Watch his aim.#1416082/12/06; 21:34:06

Noting the Vice President's most recent hunting expedition, where he ground shot one of their parties big supporters. Perhaps we all should be aware what direction he's aiming!
mikalRe: Jim Sinclair#1416092/12/06; 22:10:25

Aside from my wholesale disinterest in the risks, complexities and expenses(I am a small investor) of gold equities as investments, they are useful for analysis of the physical. Others here earn my respect for overcoming each of the above obstacles I find, in so much as they are reasonably diversified into physical according to their needs and tastes, amount of land owned, debt level etc.
So it is that James Sinclair's recent warnings regarding miner's hedging with derivatives did not concern me. But his most recent take on the debt position of producers seems to gloss over, rather than resolve the problem in the industry when he asserts that the scheme by deep pockets "authoritarian free enterprise" to own all the miners is brilliant and the impact on shareholders minimal, not mentioning gold investors and miners.
His price targets he often holds back on the claim that TPTB COT key off of his site and then the next day he's charting and forecasting all the specifics including ranges on the $, gold, miners and sometimes other markets. And these targets he's always changing. Don't take them too seriously.
A few years ago he said if gold goes over $529 without the gold cover clause being invoked, then sell because it will get below $200/ou. Sinclair said the dollar would go into freefall and precipitate the revival of the gold cover clause(certificate ratio), originally mothballed by Nixon. The cover clause basically stipulates a percentage of gold backing the dollar and was seen as the only hope to prevent an outright dollar implosion with catastrophic economic, political and social consequences, something we have discussed many times (mark-to-market CB reserve ratio).
Perhaps he would be better served by reading some of the gold sites he claims are all useless and not worth his time.

ToolieNew petropaper by 2008#1416102/12/06; 22:23:56

Snip: Dubai: The GCC General Secretariat is likely to endorse an agreement to establish a common monetary council by the end of 2006, which will be converted eventually to a Gulf central bank, a source said.
This plan will precede the GCC countries' endorsement of a common currency, its name and how it will be launched before 2008.
The Supreme Council's decision in Bahrain in 2000 to link the currency to the US dollar will be reconsidered by the common GCC monetary authority, said Al Kaud.
"The GCC central bank will have the freedom to select linking the currency to one or more currencies, or to float it, according to the requirements of the coming stage," he added.
"It was agreed that GCC countries endorse an inflation rate of not more than 2 per cent, interest rates of not more than 2 points, and that budget deficits must not exceed 3 per cent, and public debt must not exceed 60 per cent of the total debt of the country," said Al Kaud. (end snip)

White HillsNorth Korean reactor#1416112/12/06; 22:47:53

Sir Goldilox, get your facts straight about the Korean reactor. Rummy never sold them that it was part of the agreement that the United States and some other countrys made in 1994 in return for a freeze on nuke research. Of course the North Koreans cheated so in 2002 we backed out of the agreement. Also I would like some info on where I can look up that 100K people killed and all the schools and hospitals that we bombed in Iraq. Thank you, White Hills.
GoldendomeA dollar collapse cause a Gold collapse????#1416122/12/06; 23:46:19

Mikal: You said,
"...he [James Sinclair] said if gold goes over $529 without the gold cover clause being invoked, then sell because it will get below $200/ou...."

Are you sure you have this correct? It doesn't sound right to me. How would a collapse of the dollar without a cover clause cause gold to collapse to under $200./oz after having hit $529.00 ????
Sorry, but it makes no sense to me.

ToolieA new international monetary order?#1416132/13/06; 06:33:45

Snip: The governor of the Bank of Canada has been talking about the danger of rising U.S. current account deficits and swelling Asian surpluses for at least two years.
But last week in Barbados he took his musings one step further, suggesting that: "Essentially, the global economy needs a commitment by all countries to a renewed international monetary order, and a willingness to play by accepted rules within this order."
A new international monetary order? Is Mr. Dodge proposing another Bretton Woods arrangement, the international currency regime set up after the Second World War centred on the gold standard? Or another Plaza Accord, the deal hammered out among leading industrial nations in the mid-1980s to bring the U.S. dollar down? (end snip)

mikal@Goldendome#1416142/13/06; 07:04:19

Re: Are you sure he said that?
Thanks for asking. Yes, he did. You may look in his archives if you like. I copy some information verbatim and use reprints also. I agree it makes no sense. But really when he's right so much of the time he can throw a boner in there and many people will eat it up.
I STILL do LOL! But at least I can read with a relatively open mind and discern using experience, our forum and other resources.

WhitewaterwomanStrategic Investment subscription?#1416152/13/06; 07:28:38

Is a subscription to Strategic Investment/The Daily Reckoning worth it, or would it be superfluous given the bounty of info available daily on this forum?

Thanks in advance!

mikalSchultz foresees $2000 Au#1416162/13/06; 07:44:58

2D94B4%2D4E81%2DB523%2DC20C118A98C9%7D&siteid=mktw&dist= 2D94B4%2D4E81%2DB523%2DC20C118A98C9%7D&siteid=mktw&dist= Sender: This email address is being protected from spambots. You need JavaScript enabled to view it. From: This email address is being protected from spambots. You need JavaScript enabled to view it. (cxpowell) Date: Mon... To: This email address is being protected from spambots. You need JavaScript enabled to view it. Subject: [GATA] Peter Brimelow: Sanguine Schultz sees $2,000 gold
By Peter Brimelow -
Monday, February 13, 2006
NEW YORK -- Gold breaks sharply off multi-year highs. But the gold bugs aren't flinching, including one of the most famous. After reaching $572.15 on Feb. 2, gold closed at $550.20 on Friday.
But gold's friends are heartened by the fact that the "Bullish Consensus" tracked by respected institutional service Market Vane had reached an extreme peak on Feb. 2 and has now retreated equally dramatically, suggesting that traders are far from stubbornly bullish. The Hulbert Financial Digest's Hulbert Gold Newsletter Index is contracted on different principles, but also shows a rapid retreat in the past week. Mark Hulbert interprets this as good for gold, on a contrary opinion basis.
The latest issue of the monthly International Harry Schultz letter arrived about the time I was supposed to file this column. The flamboyant Schultz has been a notorious gold bug for four decades -- notorious because of his flamboyance; he's actually very quick to trade -- and his recent successes and long-term Big Thinking caused me to name him 2005's Investment Letter of the Years.
Schultz's take on gold's recent action: "Was the gold price drop last week caused by being over-touted (in the media) and overbought, and with a bearish chart parabolic curve and bearish up wedge? OR by the gold cartel? Yes! Both. The price fixers have chartists too (they run two of New York's biggest banks) and they know when any market ... is oversold, technically. So they know when to place their bets."
Schultz went on to give the clearest statement I've seen from him of the theory, widespread among investment letters but recently endorsed in a report by France's Credit Agricole bank, that the official sector has been intervening in gold and other financial markets: "They (the so-called Plunge Protection Team) subsidize the U.S. stock market when it sags to a major chart support area, which dare not break least weakened public confidence cause a crash. And they know when gold has risen to an overbought level, so they sell it short. They usually make money maneuvering for their de-facto CEO, the U.S. government. ...They also usually make money on their gold shorts, by buying back after substantial falls. THERE IS NO FREE MARKET. U.S. government prevents markets having healthy adjustments, which correct inefficiencies. ..." Schultz remainssanguine aboutgold: "We had a similar gold selloff in early December (lasting seven market days and dropping $40) but last week's was more significant as the rise went to historic highs and thereby changed people's attitudes. ...This correction may also drop $40, IMO, and will be of no importance except to allow the market to work off its overbought condition. Could it fall more than $40? Markets can do what they like (as can the Plunge Protection Team) but there's technical gold support at 540, 530. 500, 490, 480, and the ultimate gold support at 460. ... I think 530-540 is the most likely low." Schultz's strategy is to trade: "You should sell when THEY do, or BEFORE, if possible (perhaps via our GoldCharts R Us service.).We told GRCU subscriptions to take profits a full week before this latest fall, in bold terms. ..."
Schultz warns of gold "mini-crashes" -- which don't sound so mini; he means 50 percent-80 percent corrections in the gold stocks. But long-term, his view is very clear: "We're in a major gold bull market thanks to excessive bank and government credit and money creation. ... $600 is our next target, then $900, on the way to $2,000."

mikal@Toolie#1416172/13/06; 07:54:39

Great posts this last week.
The Financial Post story is fascinating. The writer quoting Canada's banker David Dodge, Don Coxe and an expert austrian economist all in the same breath as it were, is impressive IMO and leads me to ask how serious are her editors about the same message. There's been at least one other major story like that from the Post in recent days- hopefully influential people are listening.

BulldogWhitewaterwoman#1416182/13/06; 09:00:11

I used to subscribe, but given the information here and on other sites, most of what comes in strategic investment/daily reckoning can be found on the web, just my opinion FWIW.
KnallgoldSyria switches to euro#1416192/13/06; 09:17:09

..DAMASCUS (Reuters) - Syria has switched all of the state's foreign currency transactions to euros from dollars amid a political confrontation with the United States, the head of state-owned Commercial Bank of Syria said on Monday.


"This is a precaution. We are talking about billions of dollars," Duraid Durgham told Reuters.

The bank, which still dominates the Syrian market although private banks have been allowed to set up in the last few years, has also stopped dealing with dollars in the international foreign exchange flows of private clients.

The United States has been at the forefront of international pressure on Syria for its alleged role in the assassination of former Lebanese Prime Minister Rafik al-Hariri a year ago. Damascus denies involvement in the killing.

"It looks like a kind of pre-emptive action aimed at making their foreign assets safer, preventing them from getting frozen in case of any conflict," said a Middle East economist who requested anonymity.

ToolieMikal,#1416202/13/06; 11:28:20

Yes, an interesting article, It left me wanting a little more meat though.
Such thoughts must be near to top of mind in many CBs, when the combined current account and budget deficit near 10% of GDP and both are projected to grow. Which leads me to believe that the writing is on the wall and the FED knows it. We're just milking the current system to lock up future (post NMO) advantage.

According to the article Stefan Schulmeister said: the world's three main currencies, the U.S. dollar, the euro and the yen, should establish target zones to which other minor currencies could be tied. He thinks commodities should be priced in a basket of four or five currencies instead of just the dollar.

Sounds a little like freegold eh? So what are we waiting for? Oh yeah... "however, it is unlikely any of these ideas would get a serious airing until there is a full-blown crisis, even if central bankers like Mr. Dodge openly muse about it. "Societies," he said, "always need a deep crisis or even shock to start to rethink the matter."

FWIW, I think the thing to watch is the GCC common currency, that'll be up and running well before we're given cause to ‘rethink matters’. That's the timeline that the FED is working to IMHO. The article that I posted yesterday had moved the rejiggering of the GCC peg to the US$ from 2010 to 2008. The clock is ticking....

968Is Iran's plan for an oil exchange trading in euros the real issue?#1416212/13/06; 13:28:18

Article IV of the 1968 Nuclear Non-Proliferation Treaty (NPT), which entered into force on March 5, 1970, states:
1. Nothing in this Treaty shall be interpreted as affecting the inalienable right of all the Parties to the Treaty to develop research, production and use of nuclear energy for peaceful purposes without discrimination and in conformity with Articles I and II of this Treaty.
2. All the Parties to the Treaty undertake to facilitate, and have the right to participate in, the fullest possible exchange of equipment, materials and scientific and technological information for the peaceful uses of nuclear energy. Parties to the Treaty in a position to do so shall also cooperate in contributing alone or together with other States or international organizations to the further development of the applications of nuclear energy for peaceful purposes, especially in the territories of non-nuclear-weapon States Party to the Treaty, with due consideration for the needs of the developing areas of the world.

Thus, not only does Iran have an "inalienable right" to use nuclear energy for electricity, the NPT obligates the nuclear powers to "further development of the applications of nuclear energy for peaceful purposes." Iran has gone beyond its obligations under the NPT to assure others of its peaceful intentions.
According to Dr Gordon Prather, a nuclear physicist who was the top scientist for the army in the Reagan years, in December, 2003, Iran had signed an Additional Protocol to its Safeguards Agreement and had volunteered to cooperate with the IAEA -- pending ratification by the Iranian Parliament -- as if the Additional Protocol were actually "in force."

Iran also offered, says DrPrather, "to voluntarily forego a complete fuel cycle... if the Europeans would get the United States to reverse the campaign of denial, obstruction, intervention, and misinformation."
Iran had already offered on March 23, 2005 a package of "objective guarantees" (developed by an international panel of experts) that met most of the demands later made by the conservative, Washington based Heritage foundation says Dr Prather.

The International Atomic Energy Agency has found no "smoking gun" in Iran that would indicate a nuclear weapons program, says Dr Mohamed ElBaradei, the director-general of the IAEA.
Thirty years ago, Iran developing a nuclear capacity "caused no problems for the Americans because, at that time, the Shah was seen as a strong ally, and had indeed been put on the throne with American help", says Tony Benn, Britain's secretary of state for energy from 1975-79.

With world oil production expected to peak in 5 to 25 years, and demand to exceed supply sometime after that, it makes sense for Iran to look toward alternative means for generating electricity, and to reserve its oil supply for other purposes including increasing revenues from export.

The US news media are showing the same timidity that it displayed before and during the Iraq war in investigating US allegations against Iran.
John Ward Anderson of the Washington Post wrote on January 13: "The foreign ministers of Britain, Germany and France called for Iran to be referred to the UN Security Council for violating its nuclear treaty obligations."

Neither he, nor the editors, nor the ombudsman at the Post have responded to our request to identify which "nuclear treaty obligations" is Iran violating.
Writing in the Bulletin of the Atomic Scientists, Jack Boureston and Charles D. Ferguson say, "In pursuing a civilian nuclear program, Iran has international law on its side... . The best way to know the full extent of Iran's nuclear doings is to offer it help."

USAGOLD / Centennial Precious Metals, Inc.FREE Gold Information Packet...#1416222/13/06; 13:53:04

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MONDAY Market Excerpts

Gold revisits early January price, awaits Bernanke

February 13 (from MarketWatch) -- Gold futures fell over 2% Monday as the COMEX April gold contract finished the session down $11.40 at $542.10, its lowest close since Jan. 5.

"Gold is still correcting the overbought condition that had existed," said Ned Schmidt, editor of Value View Gold Report. "A meaningful low for the short term is possible" Tuesday.

Traders were sanguine about the move, which they said could be expected after the bull run of the past six months.

Maybe some of the headlines -- on Iran, protests following a Danish newspaper's cartoons depicting the Prophet Muhammad, Senate hearing of all kinds and a record trade deficit -- "have worked their way lower on the 'hit parade' chart and they have become 'familiar noise' to most of us," said Jon Nadler, investment products analyst at bullion dealers Kitco. "But in fundamental terms, nothing has really changed," he said.

"The same factors and motives that drove investors to gold over the last three months remain very much in place." Emanuel Balarie, a senior market strategist at Wisdom Financial, said traders should see the recent weakness in gold prices as a buying opportunity.

"In the last several weeks, gold has dropped 5% from its 25-year high," Balarie said. But "demand for gold as an alternate currency, global demand from central banks, and the continued demand for jewelry in China, India and emerging economies will continue for several years to come."

U.S. Federal Reserve Chairman Ben Bernanke will offer his first congressional testimony on Wednesday.

"How the markets will react to the new chairman's words is a serious unknown," said Value View Gold Report's Schmidt.

Former Chairman Alan Greenspan "got us to over $500 -- Bernanke will do the rest and give us $1,300 gold," he said.

Given that prospect, "gold buyers should take advantage of any lower prices late in the week," Schmidt said.

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

FlatlinerThank you TownCrier for the pointer this weekend.#1416242/13/06; 15:58:32

I was able to find an official pointer there (that I still haven't had time to read), but I still can not find an argument with the article behind the link. From it, "There is no comparison whatsoever between a real asset in my hand and a claim on that asset."
balzacTOOLIE re 141620#1416252/13/06; 16:35:52


SundeckGCC#1416262/13/06; 17:15:24

= "Gulf Common Currency"

Try Google web search for more context.


Chris PowellGCC#1416272/13/06; 18:12:43

It stands for Gulf Cooperation Council.
SundeckGCC#1416282/13/06; 18:41:33

Ahhhh! Yes, Sir CP...that makes things clearer...tks


PRITCHO@Whitehills -- For Whitehills Re Info Requested from Goldie -- Msg 41611#1416292/13/06; 20:57:37 -- The American Rules of Engagement From the Air

Your eyes may read but I doubt you will allow yourself the luxury of an open mind.The following links are from a Google search.I'm sure you'll still manage to find fault with the reports.This is posted for YOUR request and I want to make it clear that I don't want to debate any of it with you.

Other Links To Cut & Paste:

How many dead innocent Iraqis is too many?

The Struggle Against Terrorism

Winning Hearts & Minds

Body & Soul

The birth of outrage

GoldendomeAre you being googled yet?#1416302/13/06; 20:59:03

A new definition:

"googled" verb,adj,advb. meaning: To lose value at an extreme rate.

Examples of use in sentences:

Though the value of gold has fallen this past week, it has not googled.

Google shares have googled.

Stocks in companies that go bankrupt generally google.

PRITCHOApologies -- Re Lead Link not Working (Last Message )#1416312/13/06; 21:28:04

This one should work - - -
PRITCHOFrom Richard Russell - - - - Latest Comments February 13, 2006#1416322/13/06; 21:59:50

Richard sees problems getting closer for the general sharemarket - --
Question -- In view of what you're seeing, what should our investment stance be?

Answer -- I would move to put your investment "house" in order. I would unload any stocks that you're not willing to sit with during a bear market. I would use all market rallies and period of stability as an opportunity to do this. The stock market has looked "calm" over the last few months, but that is deceptive. The fact that on Friday Lowry's Selling Pressure rose to a new high for the year is a definite warning. The time to sell is when the market is still "tranquil," not when the bear forces are driving stocks lower.
Question -- How might gold act in a bear market?

Answer -- Do you note how erratic gold is acting now? Surging volatility -- down 20 dollars, up 14 dollars, down 14 dollars. . . This is indecision, confusion, clashing opinions. One scenario -- the economy starts to tank in a bear market, gold first gets hit. The Bernanke Fed freaks out in the face of potential deflation as home prices sink. The Fed drops short rates a full point and opens the money spigots wide. The dollar plunges, and gold then starts to climb.

I've written repeatedly about the Fed's fear of even a hint of deflation. The Greenspan Fed made a long and exhaustive study of the long Japanese deflation and bear market. Moreover, Fed chairman Bernanke is an expert on the Great Depression and the Fed's mistake in allowing and even abetting deflation. Take my word for it, the Bernanke fed will use any means at their disposal to fight a recession and deflation. I have no doubt that the Fed would institute and accept hyper-inflation rather than deal with deflation.

Question -- Russell, are you saying that the Bernanke Fed would create hyper-inflation if a deflationary recession set in?

Answer -- That's exactly what I'm saying. In fact, I believe the Fed would institute a number of "unconventional" techniques if they had to -- in an effort to turn any hints of deflation around.

Question -- If the Fed opened the flood gates and drove interest rates down again, wouldn't this impact on the dollar?

Answer -- Absolutely.

CamelBe sure of what you are shooting at#1416332/13/06; 22:11:04

Since we all now know that people such as Cheney, Rummy Rove, and Ken Star are totally ruthless 'sharks in the water,willing to hound a person literally to the death I don't imagine he is expecting much sympathy, nor does he deserve it.
DruidForget Iran, Americans Should Be Hysterical About This #1416342/13/06; 22:37:46


"Last week the Bureau of Labor Statistics re-benchmarked the payroll jobs data back to 2000. Thanks to Charles McMillion of MBG Information Services, I have the adjusted data from January 2001 through January 2006. If you are worried about terrorists, you don't know what worry is.

Job growth over the last five years is the weakest on record. The US economy came up more than 7 million jobs short of keeping up with population growth. That's one good reason for controlling immigration. An economy that cannot keep up with population growth should not be boosting population with heavy rates of legal and illegal immigration.

Over the past five years the US economy experienced a net job loss in goods producing activities. The entire job growth was in service-providing activities--primarily credit intermediation, health care and social assistance, waiters, waitresses and bartenders, and state and local government.

US manufacturing lost 2.9 million jobs, almost 17% of the manufacturing work force. The wipeout is across the board. Not a single manufacturing payroll classification created a single new job.

The declines in some manufacturing sectors have more in common with a country undergoing saturation bombing during war than with a super-economy that is "the envy of the world." Communications equipment lost 43% of its workforce. Semiconductors and electronic components lost 37% of its workforce. The workforce in computers and electronic products declined 30%. Electrical equipment and appliances lost 25% of its employees. The workforce in motor vehicles and parts declined 12%. Furniture and related products lost 17% of its jobs. Apparel manufacturers lost almost half of the work force. Employment in textile mills declined 43%. Paper and paper products lost one-fifth of its jobs. The work force in plastics and rubber products declined by 15%. Even manufacturers of beverages and tobacco products experienced a 7% shrinkage in jobs.

The knowledge jobs that were supposed to take the place of lost manufacturing jobs in the globalized "new economy" never appeared. The information sector lost 17% of its jobs, with the telecommunications work force declining by 25%. Even wholesale and retail trade lost jobs. Despite massive new accounting burdens imposed by Sarbanes-Oxley, accounting and bookkeeping employment shrank by 4%. Computer systems design and related lost 9% of its jobs. Today there are 209,000 fewer managerial and supervisory jobs than 5 years ago.

In five years the US economy only created 70,000 jobs in architecture and engineering, many of which are clerical. Little wonder engineering enrollments are shrinking. There are no jobs for graduates. The talk about engineering shortages is absolute ignorance. There are several hundred thousand American engineers who are unemployed and have been for years. No student wants a degree that is nothing but a ticket to a soup line. Many engineers have written to me that they cannot even get Wal-Mart jobs because their education makes them over-qualified."

Druid: No surprise here at the castle but a hell of a read anyway. Enjoy.

The Invisible HandRiver in Egypt#1416352/14/06; 02:45:33

We're addicted to more than oil and it's costing us
By Paul B. Farrell
Last Updated: 2/13/2006 7:45:00 PM

Insert: chart "Is the stock market to crash and burn?"

Denial blinds us to many dangers. Like the coming Iranian Petro-Euro Bourse threatening the American dollar's position as the world's reserve currency, a threat potentially more catastrophic than a nuclear arsenal. We deny it.
Remember waitookay?

KnallgoldFreeGold in China#1416362/14/06; 05:55:08

These stories are popping up everywhere,about whatever new Goldpaper in China,Dubai etc.They either are leaving the good path or just sit it out until the central GO! comes.And what kind of experts are these "industry participants" and "experts" really when they ask for a hedging tool for Gold?
How do you hedge wealth and the ultimative hedge,if not with pure Gold???

China is planning to set up a gold investment fund, hoping to capitalize on the surging price of the metal, reported Friday's China Daily.

If successful, the fund, which is still at the proposal stage, will be the country's first gold investment fund, the newspaper said.

It was reported earlier this week that the China Gold Association (CGA) is considering setting up a fund with other partners, who include commercial banks and gold miners, citing Hou Huimin, the CGA's vice-chairman.

"The (setting up of the) fund is still in its research and study phase," Lu Wenyuan, secretary-general of the CGA, said Thursday, declining to elaborate.

"We are still in discussion with other parties on the issue and have not yet started formal work on the project," the newspaper citied Lu as saying.

The fund, which is expected to pool between 500 million yuan (US$62million) and 1 billion yuan (US$124 million), will mainly invest in gold products traded on the Shanghai Gold Exchange, while investment in domestic and overseas gold futures markets will be the next step, according to International Finance News reports.

>>>>>>Currently, there is no gold futures trading in China,<<<<<<<< but industry participants and experts have long called for it in order to provide a hedging tool for gold miners, processors and traders.

The introduction of the proposed gold investment fund, analysts and experts say, will provide a boost to the gold market.

"The timing (of establishing the gold fund) couldn't be better as the recent gold price surge has caught the attention of investors, both incumbent and potential ones," said Cui Lin, a gold analyst with Antaike Information Technology Development Co Ltd, a Beijing-based metal industry consultancy.

"Investors' heightened attention will make it easy for the proposed fund to attract investment," said Cui.

Source: Xinhua

Chris PowellChina's official voice sounds awfully partial to gold#1416372/14/06; 06:46:46

Expert: What Buoys Gold Price After a Downturn

By Li Jianmin
People's Daily Online, Beijing
Tuesday, February 14, 2006

The international gold price has soared 37 percent over the past six months and hit the peak for the past 25 years doubling that of five years ago. This has aroused much attention of the world financial circle. What are the reasons for the considerable rise following its plunge?

Before 2002, the gold price was dragged down largely by the obsession in paper wealth on the bull capital market. Even central banks thought it cost to hold gold and reduced their gold assets by putting gold under hammer. In the meantime, gold mining businesses sold their gold reserves yet to be exploited on the international futures market to prevent the gold price from falling. That gave a
further blow to the gold price.

The burst of the US stock market bubble finally gave people a dose of sobriety. A concept remains a concept even if it is priced at a hundred dollars. Tangible things give more sense of security. Investment in products beyond stocks and bonds gained increasing popularity and investment on precious metals like gold and silver
rebounded significantly.

Generally speaking, the gold price has been boosted by:

--- Consumers. There are industrial consumption and consumption for jewelries as well as personal investment. People from India, China, and East Asian nations traditionally favor gold. Richer people there have spurred the demand for jewelries. There is a spending spree on
gold among average Japanese. The gold price denominated with Japanese Yen has even become one of the decisive factors on the Asian gold market.

--- The change of central banks' attitude toward gold. Central banks reducing their gold holdings have slowed down their pace of reduction given the recovery of gold price. Some central banks (such as those of Russia and South Africa) have begun to add more gold to their reserves mix.

--- The change of gold enterprises. They have given up their policy of hedging by selling gold futures, which in turn helps to ease the pressure of gold price. In this case, many gold enterprises have to make short hedge and that pushed gold price up.

--- Demand from fund investment. Funds are seeking investment opportunities on gold to diversify risks, directly leading to gold price rise. Some banks have established specialized trading floors for gold exchanges. Gold held by this new type of fund has reached 420 tons since 1995, very close to the two years' production of
Newmont, the world's largest gold mining company.

Gold is expected to continue to be strong, mainly boosted by the uncertainties in the international politics, which highlights the role of gold in avoiding risks. Historically the unrest in world situation always gave rise to a gold fever. The gold price hit its historic high of 850 US dollars per ounce in 1980 during the Iran-Iraq war.

The diversity of investment will continue. The public have also joined the game that used to be dominated by professionals. Now the domestic financial institutions, the Bank of China in particular, have offered financial products to investors, either in the form of tangible gold or gold accounts.

Although there is surging demand on the gold market, the global gold reserves and mining capacity do not go up at the same pace. The imbalance in demand and supply will continue to fuel the gold price.

In addition, investing in gold is one of the ways to offset the inflation. Some market insiders regard the rising gold price as the expectation for the future inflation by the financial market. The global economy recovered after the US slashed its interest rates between 2001 and 2004 but the low interest rate environment also
underpinned the risk of inflation.

Investment goes with risks. Gold price in particular normally fluctuates more sharply than any other financial products like foreign exchange. Sustainable profitability is secured only when a well-structured portfolio is designed.

A mature investor, therefore, should set a clear bottom line of risks for his/her investment. Unfavorable market scenarios call for prompt measures to minimize losses.


The article is written by Li Jianmin from the gold counter of the world financial market section, Bank of China, and edited and translated by People's Daily Online.

tejbearThe Economy#1416382/14/06; 08:48:01

A fellow named Ed Henry wrote and interesting article contrasting the "published" US economy verses income taxes.

Snip:"What could this January's low level surplus mean? In 2004, the accumulated surplus by the end of January was $21 billion. In 2005, it was $23.5 billion. This year, it's $6.8 billion. That's a heck of a drop.

Could it be that the new job numbers we've been hearing are all low paying jobs? Or is it that they are simply not sufficient to keep up with the number of people being laid off? Maybe, it's a combination of both or the government is just making up new job numbers."

Tom: It is a short article, but provides additional definitive evidence of double speak by the Bush & Co. It is worth reading

PS. With POG at the 50 moving average, today looks like a good day to buy!

Good Luck to All,

The Bear

968IMPORTANT : China signs joint statement with EU to promote accounting standard !!!#1416392/14/06; 08:58:17

BEIJING, Feb. 14 (Xinhuanet) -- The Chinese Ministry of Finance announced here Tuesday that it has just signed a joint statement with the European Union (EU) on promoting the international accounting standard (IAS) in China.

The statement said China and the European Union will increasing their cooperation in the future in making and carrying out the IAS.

The two parties also decided to held regular meetings in the future on the IAS and report to each other on the latest solutions to those problems found in the promoting process of IAS.

Chinese Vice Minister of Finance Wang Jun, who is also secretary-general of the China Accounting Standard Committee, said that the cooperation between China and the EU on the IAS is one vital move under the financial dialogue framework of both sides.

The signing of the joint statement will be of great importance in upgrading China's role in the global accounting market and laying an accounting foundation for China's sustained and healthy economic growth. Enditem
The IAS 39 account standard is about fair value accounting, or in other words : mark-to-market accounting, including goldreserves !!!!

968@ Towncrier#1416402/14/06; 09:21:59

Hello Townie,

Any thoughts on msg#: 141639 ?

USAGOLD / Centennial Precious Metals, Inc.Thanks to derivative pricing (and the futures liquidation), a great deal is made even better#1416412/14/06; 10:33:02

February Buyers' Group
Special discounts and incentives on special coins!

German Wilhelm II (and Wilhelm I)

German 20 mark gold coin

Call and Save
1-800-869-5115 (Ext. 100)

TownCrier968, China cooperates with European Union on accounting standard#1416422/14/06; 11:02:14

Knowing you to be an avid reader here, I'm certain your question about my thoughts on this matter is meant to provide me with an opportunity to smile, wave to the skeptics, and say "See! I (we) TOLD you so!"

I have tried to stress this point for a long time now that even a simple person (such as myself) can very easily grasp the motivations and inevitability behind this evolutionary transition in the international monetary system if they can grasp one very basic premise -- that premise being, metaphorically, that if a better mousetrap is built, the whole world will beat a path to the inventor's door.

Regarding reserves, the accounting practice which recognized and allows for freefloating MTM gold IS indeed the "better mousetrap".

Thanks for the article. Let's keep our eyes peeled for more good news -- evidence of the evolution away from the "old" dollar-IMF style accounting to the "new" euro-style which puts us further down the path toward free (liberalized) gold.


mikalRussia sees bull market through end of decade#1416432/14/06; 11:24:32

Russia May Become Biggest Gold Producer in 10 - 15 Years - Itar-Tass - February 13, 2006
"Russia is taking steps to double production of the precious metal."

mikalWGC whispers#1416442/14/06; 11:38:32

China Hungry for Gold - World Gold Council
14:25:23 GMT, 14 February, 2006
Shanghai Gold Exchange president Wang Zhe believes that China could become one of the world's biggest gold importers.
The country's gold trading volume increased by 36 per cent in 2005, and Mr Zhe said China "has the potential to be one of the biggest gold markets in the world," according to the Financial Times. His views are supported by recent consumer spending in the world's most populous country.
The Old Phoenix jewellery store in Shanghai has been selling a large number of $2,000 gold bars embossed with the Beijing Olympics logo. A salesman said that "there will be a new bar every year until 2008 and many people want the complete set".
The situation is vastly different from even a few years ago – up to 1982, individuals in the country were not allowed to own gold. However, the country is now poised to become a significant gold importer. "Commodities will have a strong investment case in the year ahead because of the strong Asian growth," said Michael Hartnett of Merrill Lynch. Gold in particular has a strong case as global growth gains momentum in the second half of 2006.

FlatlinerJust watching#1416452/14/06; 14:19:47

NYMEx Issues for February.

Silver 200 (Unchanged) or 1,000,000 ounces.
Gold 6,954 (up from 6,439 last posting) or 695,400 ounces (up from 643,900).

Total Eligible in golden warehouse 2,482,998 (up from 2,323,851 last posting). Total registered 4,991,704 (down from 5,063,549). Withdrawn 2,411 – Brinks Inc.

It's interesting to see 51,500 ounces added since the last "just watching" post. I am expecting that we'll see another stepping in ETF holdings. Previous graphs that I've seen show ETFs adding to their positions when the price of gold dips. This jump over the last few days seems to support this. But, I'm just guessing.

USAGOLD Daily Market ReportPage Update!#1416462/14/06; 14:49:11">
The Daily Gold Market Report has been updated.

If you are considering investments in gold we invite you to">request our free introductory information packet detailing the products and services offered by USAGOLD ~ Centennial Precious Metals. We welcome your inquiry and look forward to working with you.

TUESDAY Market Excerpts

February 14 (from Reuters) -- U.S. gold futures bounced from a five-week low to settle higher on Tuesday as cheaper prices after the sharp correction lower in the last week attracted new physical and speculative buying, dealers said.

COMEX April contracts climbed $6.80 to $548.90 after dealing from $537.80 -- its lowest price since Jan. 6 -- to a session high of $550.50.

Consumer interest in gold was rekindled with prices down near $540 an ounce, dealers said, and that newfound buying prompted some traders to ditch short positions taken amid the recent fund-led sell-off in precious and base metals markets.

"There is some physical business coming back into the market, and as soon as we saw the uptick, people were covering shorts, and that triggered stop-loss buying," said a trader in New York.

"Generally, I think people are bullish in the long term, so nobody wants to get caught short."

Market watchers were reluctant to say gold's major correction was over, despite signs of strength on Tuesday. "With physical demand still light (although slightly more enthusiastic than on Monday), we are hesitant to call the bottom of this correction yet, although we suspect that gold will base within the next few days, if it hasn't already," said investment bank UBS in a daily precious metals note.

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

J-BullionGoldman says sell!#1416472/14/06; 15:13:48

This is laughable. The usual suspect bashes the hell out of the price on TOCOM and NYMEX to paint the tape and then try to get everyone to panic (probably so they can cover that massive short position they've built). Like the boy who cried wolf, wonder if anyone is listening anymore?


Caradoc"Iran's euro-denominated oil bourse to open in March"#1416482/14/06; 15:14:53

Article's subtitle is "US Dollar Crisis on the Horizon."

Worth reading; my apologies if link already posted.


TownCrierJ-Bullion, Goldman says...#1416492/14/06; 15:32:25

I saw that article a bit earlier in the day, and the notable thing I came away with was the specificity of FUTURES in the liquidation recommendation. At the end of the day, there's a big difference between the management of ones paper juggling act and ones physical metal ownership. Noted for what it's worth.


Federal_ReservesRunning on empty....deficits and bankruptcy to come#1416502/14/06; 15:34:28

Running on empty....

UPDATE 2-US on track to hit debt ceiling mid-Feb--official
Mon Feb 13, 2006 5:39 PM ET
By Mark Felsenthal and Richard Cowan

WASHINGTON, Feb 13 (Reuters) - The U.S. government is on track to hit its debt ceiling by mid-February, Treasury
Department spokesman Tony Fratto said on Monday.

Asked at a press briefing when Treasury will reach the statutory $8.18 trillion debt limit, Fratto said,
"The middle of the month."

"We clearly are approaching the point where Treasury will have to determine the instruments necessary to
avoid slamming the top of the debt limit," he added.

Lawmakers of both parties have expressed concerns about raising the debt limit with a budget deficit the
administration projects to reach a record high $423 billion in 2006.

Economists doubt Congress will refuse to raise the limit. A federal default is considered unimaginable
because it would rattle bond markets, force interest rates higher and shake the economy.

The last time Congress agreed to boost the debt limit was in November 2004 — from $7.38 trillion to the
current $8.18 trillion. The government's statutory borrowing authority also was pushed up in 2002 and in 2003.

> Already the debt limit has been breeched. Congress is breaking the law. Write your congress people and
senators and complain. Tell them you plan to vote against them and then follow through. We are addicted
to debt. Ton's of it. All placed on our childrens shoulders. Such disgrace and scandal!

Current Amount

02/13/2006 $8,205,376,724,587.34
The limit $8,180,000,000,000.00

Weekend Edition, February 11-12, 2006

Forget Iran, Americans Should be Hysterical About This.
Nuking the Economy

Last week the Bureau of Labor Statistics re-benchmarked the payroll jobs data back to 2000. Thanks to Charles
McMillion of MBG Information Services, I have the adjusted data from January 2001 through January 2006. If you
are worried about terrorists, you don't know what worry is.

Job growth over the last five years is the weakest on record. The US economy came up more than 7 million jobs
short of keeping up with population growth. That's one good reason for controlling immigration. An economy that
cannot keep up with population growth should not be boosting population with heavy rates of legal and illegal

Over the past five years the US economy experienced a net job loss in goods producing activities. The entire
job growth was in service-providing activities--primarily credit intermediation, health care and social
assistance, waiters, waitresses and bartenders, and state and local government.

US manufacturing lost 2.9 million jobs, almost 17% of the manufacturing work force. The wipeout is across
the board. Not a single manufacturing payroll classification created a single new job.

The declines in some manufacturing sectors have more in common with a country undergoing saturation bombing
during war than with a super-economy that is "the envy of the world." Communications equipment lost 43% of
its workforce. Semiconductors and electronic components lost 37% of its workforce. The workforce in computers
and electronic products declined 30%. Electrical equipment and appliances lost 25% of its employees. The
workforce in motor vehicles and parts declined 12%. Furniture and related products lost 17% of its jobs.
Apparel manufacturers lost almost half of the work force. Employment in textile mills declined 43%. Paper
and paper products lost one-fifth of its jobs. The work force in plastics and rubber products declined
by 15%. Even manufacturers of beverages and tobacco products experienced a 7% shrinkage in jobs.

The knowledge jobs that were supposed to take the place of lost manufacturing jobs in the globalized
"new economy" never appeared. The information sector lost 17% of its jobs, with the telecommunications
work force declining by 25%. Even wholesale and retail trade lost jobs. Despite massive new accounting
burdens imposed by Sarbanes-Oxley, accounting and bookkeeping employment shrank by 4%. Computer systems
design and related lost 9% of its jobs. Today there are 209,000 fewer managerial and supervisory jobs
than 5 years ago.

In five years the US economy only created 70,000 jobs in architecture and engineering, many of which
are clerical. Little wonder engineering enrollments are shrinking. There are no jobs for graduates.
The talk about engineering shortages is absolute ignorance. There are several hundred thousand American
engineers who are unemployed and have been for years. No student wants a degree that is nothing but a
ticket to a soup line. Many engineers have written to me that they cannot even get Wal-Mart jobs because
their education makes them over-qualified.

Offshore outsourcing and offshore production have left the US awash with unemployment among the highly
educated. The low measured rate of unemployment does not include discouraged workers. Labor arbitrage has
made the unemployment rate less and less a meaningful indicator. In the past unemployment resulted mainly
from turnover in the labor force and recession. Recoveries pulled people back into jobs.

Unemployment benefits were intended to help people over the down time in the cycle when workers were laid
off. Today the unemployment is permanent as entire occupations and industries are wiped out by labor
arbitrage as corporations replace their American employees with foreign ones.

Economists who look beyond political press releases estimate the US unemployment rate to be between 7%
and 8.5%. There are now hundreds of thousands of Americans who will never recover their investment in their
university education.

Unless the BLS is falsifying the data or businesses are reporting the opposite of the facts, the US is
experiencing a job depression. Most economists refuse to acknowledge the facts, because they endorsed
globalization. It was a win-win situation, they said.

They were wrong.

At a time when America desperately needs the voices of educated people as a counterweight to the
disinformation that emanates from the Bush administration and its supporters, economists have discredited
themselves. This is especially true for "free market economists" who foolishly assumed that international
labor arbitrage was an example of free trade that was benefitting Americans. Where is the benefit when
employment in US export industries and import-competitive industries is shrinking? After decades of
struggle to regain credibility, free market economics is on the verge of another wipeout.

No sane economist can possibly maintain that a deplorable record of merely 1,054,000 net new private
sector jobs over five years is an indication of a healthy economy. The total number of private sector
jobs created over the five year period is 500,000 jobs less than one year's legal and illegal immigration!
(In a December 2005 Center for Immigration Studies report based on the Census Bureau's March 2005 Current
Population Survey, Steven Camarota writes that there were 7.9 million new immigrants between January 2000
and March 2005.)

The economics profession has failed America. It touts a meaningless number while joblessness soars. Lazy
journalists at the New York Times simply rewrite the Bush administration's press releases.

On February 10 the Commerce Department released a record US trade deficit in goods and services for
2005--$726 billion. The US deficit in Advanced Technology Products reached a new high. Offshore production
for home markets and jobs outsourcing has made the US highly dependent on foreign provided goods and
services, while simultaneously reducing the export capability of the US economy. It is possible that
there might be no exchange rate at which the US can balance its trade.

Polls indicate that the Bush administration is succeeding in whipping up fear and hysteria about Iran.
The secretary of defense is promising Americans decades-long war. Is death in battle Bush's solution to
the job depression? Will Asians finance a decades-long war for a bankrupt country?

Paul Craig Roberts was Assistant Secretary of the Treasury in the Reagan administration.
He was Associate Editor of the Wall Street Journal editorial page and Contributing Editor of National Review.

J-BullionRe: Goldman says sell#1416512/14/06; 16:43:17

Towncrier: Here's the news from the GATA camp.

Now Goldman wouldn't do this would they? Send a message out to the paid media for people to sell, meanwhile they are covering their shorts? Would they? That is completely unethical. They might make billions, and then have to pay a few million dollars in fines. :-)


Goldman Sachs reduced their SHORT position by staggering 7061 contracts to 45993 contracts in Feb 13 overnight session on TOCOM. It was about 4733 on Friday and 2328 last night. Yes, they are covering on this break! As I have often said they have given up hope of a correction down to where they started putting on shorts at $490/oz. They have been adding shorts recently to increase the average price of their short position to minimize losses. They clearly do not expect much more down side. To put icing on the cake they ADDED to their LONG position. They added a total 430 contracts by adding 200 in JUN and 240 in AUG and 72 in OCT. They sold 82 of their APR longs. This is a big indication that this pullback is all we are going to see.

David LinkleyAncedotal evidence#1416522/14/06; 17:31:17

Today a friend of mine who works for a large real estate commercial brokerage firm related a story that his firm paid a well known economist to come an address their annual meeting in January. This economist said that deficits (both trade and budget) don't matter, the US is stonger than ever, corporations have so much cash the economy is going to boom after this little downturn in 2007, yada - yada - yada.

This kind of mainstream belief system combined with the Goldman recommendation today plus falling sentiment makes me think this correction may not last much longer. It kind of reminds me of Irving Fisher's statement in 1929 that equity valuations had reached a permanent higher plateau.

God help us all. Never have so many failed to see the warning signs. Got gold?

The Invisible Handrisk is indeed the reserves, not the pricing per se#1416532/14/06; 17:49:27

Iran, Venezuela declare war on petrodollar
The risk to the United States does not involve how oil is priced – oil could conceivably be priced in any liquid currency, since pricing is a largely technical issue needed to establish transaction values. The real issue is foreign-currency reserves.

The Invisible Handforeign-currency reserves #1416542/14/06; 18:25:04

I can't find the definition of foreign currency reserves in Mises, Rothbard or Reisman.

Berlage and Decoster write however that
foreign-currency reserves can be considered as an investment by monetary authorities in foreign assets ("activa" in Dutch), i.e. foreign currency
(Berlage and Decoster. "Inleiding tot de Economie", Louvain University Press, 2000, p.409).

So a switch of foreign-currency reserves to euro, means …

NedWhy do we not hear much from Roach anyone?#1416552/14/06; 18:54:57

Stephan Roach was it? From Morgan Stanley?
GoldendomeNed: Ask and ye shall receive...#1416562/14/06; 19:31:41

Your daily "Roach" fix.
Mthirsty1nice#1416572/14/06; 20:35:08

Not alot to say,except it was a nice day for gold.It's fun to just sit back and watch as the world turns.Hopes and prayers to Mr. whittington.
mikalGold for "everyone"#1416582/15/06; 07:55:12

Gold Perfect for Bored Property Buyers - Irish Independent - Brendan Keenan < 02/14/06 > A unique perspective on gold attitudes in another small corner of the world.
adminPower Outage#1416592/15/06; 09:25:42

Our phones and computers are down this morning due to a power outage. We will post here when the power is back up.
Gandalf the WhiteThe 10 oclock US$ "PUMP" for HeloBen occurred today also !#1416602/15/06; 09:36:00

While HeloBen was "testifying" -- did you hear his straight faced answer to why the impact of the rise in oil prices on the economy, was different "NOW", from that of the 1970's period ?
He did not say, (but was really thinking), was that, --THEN, they (FED) did not have the "spin" machine set up, as they do now, AND that now they (FED) can "cook" the books so much easier NOW with the use of DERIVITIVES !

geBust in energy futures?#1416612/15/06; 10:30:48

Interesting thread from a forum.

"Lo and behold, what transpired the last couple of days but oil trading at this moment at $59.41 and gasoline trading at $1.385 per gallon. If I multiply $1.385 times 42, I come up with $58.17, meaning gasoline is selling at the present for $1.24 less than crude is."

Flatliner@Bust in energy futures?#1416622/15/06; 11:15:33

ge, your post is most puzzling. There must surely be a huge surplus of unleaded gasoline for it to be liquidated like this and invert. I wonder if those huge stockpiles came from the percentage of the gulf refineries that have been reported as being offline for some months now. I mean, where else could extra supply come from?

This one will be most interesting to watch play out. It sure brings to light the true function of the derivatives markets. I would half expect that in a few months, anyone holding this actual commodity will NOT be selling it on the futures market. Then, when I think of gold, I can't help but wonder if the same hold's for it's future?

Black BladeOil and Gas Inventory#1416632/15/06; 11:44:08

For those wondering about the rise in gasoline and distillates in today's EIA inventory report:

"Total motor gasoline imports (including both finished gasoline and gasoline blending components) last week averaged 1.1 million barrels per day. Distillate fuel imports averaged 680,000 barrels per day last week, the seventh highest weekly average ever."

Gasoline imports from the EU and Japan have been extraordinarily large since Katrina-Rita. The IEA (and perhaps even the EIA) pressured the EU to contribute gasoline from their strategic reserves after the hurricane and Japan joined in shortly after. This is really not much of a surprise and the EU can dig into their Strategic stockpiles for gasoline as they are largely a consumer of diesel. At some point the EU strategic reserves must be refilled to 80% capacity under existing EU regulations. Should then get - should I say it? - "Interesting".

- Black Blade

USAGOLD - Centennial Precious Metals, Inc.Brokerage office closed today due to blockwide power/phone outage#1416642/15/06; 12:11:34

Goes to show we can't do much without lights and phones in this modern world. However, we anticipate this inconvenience will be resolved later this day and expect to be conducting business as usual again tomorrow.

-- posted by Randy

TownCrierChina hungry for gold#1416652/15/06; 13:53:07

Shanghai Gold Exchange president Wang Zhe believes that China could become one of the world's biggest gold importers.
The country's gold trading volume increased by 36 per cent in 2005, and Mr Zhe said China "has the potential to be one of the biggest gold markets in the world," according to the Financial Times.

The situation is vastly different from even a few years ago -- up to 1982, individuals in the country were not allowed to own gold.

...the country is now poised to become a significant gold importer.

"Commodities will have a strong investment case in the year ahead because of the strong Asian growth," said Michael Hartnett of Merrill Lynch.

Gold in particular has a strong case as global growth gains momentum in the second half of 2006.

^---(from ur)---^

A good reminder of some of the fundamental underpinnings for gold metal ownership -- portable property that offers more security than alternate forms of inflatable paper savings.


USAGOLD Daily Market ReportPage Update!#1416662/15/06; 15:03:46">
The Daily Gold Market Report has been updated.

If you are considering investments in gold we invite you to">request our free introductory information packet detailing the products and services offered by USAGOLD ~ Centennial Precious Metals. We welcome your inquiry and look forward to working with you.

WEDNESDAY Market Excerpts

Gold lower, holds above 5-week lows

February 15 (from MarketWatch) -- Gold futures closed with a loss of over $6 an ounce Wednesday after Federal Reserve chief Ben Bernanke said U.S. interest rates may need to rise further to cool inflation generated by a strong economy and higher energy prices.

Bernanke walked a fine line in his first-time testimony to Congress, establishing his inflation-fighting credentials without scaring the market.

Beyond Bernanke's remarks, "gold was just way overbought, and the pendulum now needs to swing back some," said Peter Grandich, editor of the Grandich Letter.

COMEX April gold futures closed down $6.20 at $542.70.

"Gold remains vulnerable to further weakness as it looks like the 50-day moving average around $535 is going to be tested again and could be breached," said Grandich. "A washout to as low as $510 is possible, but would be the best thing in the long run."

Comments by the Fed chairman "indicate a good deal of preoccupation with pesky inflation and with a housing sector full of 'uncertainty,'" said Jon Nadler, investment products analyst at bullion dealers Kitco.

Among other things, gold appears much more concerned with Iran, growing trade deficits and the prospect that China may diversify out of U.S. dollars, he said.

"In the gold trading pits, economic uncertainties are taking a back seat to uncertainties of a different nature these days," Nadler said.

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

TownCrierRefco cancels auction for its forex assets#1416672/15/06; 17:25:30

NEW YORK, Feb 15 (Reuters) - Refco Inc., the bankrupt futures and commodities brokerage, said on Wednesday it has canceled the auction scheduled for Thursday, Feb. 16 of its foreign exchange assets.

In a statement, Refco said it canceled the auction for the online foreign exchange assets of its Refco FX Associates LLC unit because it had not received any bids other than the original offer by Forex Capital Markets LLC.

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

Apparently not much interest being shown in something that sounds fairly sketchy to begin with -- "ONLINE foreign exchange assets"???

Choose gold.


The Invisible HandCut his Hands and Sterilize Him#1416682/15/06; 18:10:15

[Under the picture] Mr Bernanke is seen as a safe pair of hands by many investors
"He is obviously establishing his credentials as an inflation hawk, which is of course what the global financial markets want to hear," said Kathleen Camilli, president of Camilli Economics in New York.

USAGOLD Daily Market Report (2/15/06; 15:03:46MT - msg#: 141666)
Bernanke walked a fine line in his first-time testimony to Congress, establishing his inflation-fighting credentials without scaring the market

Is this helicopter Ben?
Yes, he's a safe pair of hands for goldbugs.
But does he have inflation-fighting credentials?
What kind of world do we live in?

Yesterday, I couldn't find the definition of foreign currency reserves in Mises, Rothbard or Reisman (The Invisible Hand (2/14/06; 18:25:04MT - msg#: 141654))
Here's FWIW (I'm not sure these excerpts are relevant to the question) Milton Friedman "The Case for Flexible Exchange Rates" in: "Essays in Positive Economics", University of Chicago Press, 1953, reprinted in Kurt R. Leube, ed., "The Essence of Friedman", Hoover Institution Press 1987, 461, pp. 471- 472

Traditionally … monetary reserves have not been used as the primary method of adjusting to changes in external conditions but as a shock absorber pending changes in external conditions.
Already in the 1920s, the United States … refused to allow its surplus, which took the form of gold imports, to raise domestic prices in the way the supposed rules of the gold standard demanded; instead it "STERILIZED" gold imports. Especially after the Great Depression completed the elevation of full employment to the primary goal of economic policy, nations have been unwilling to allow deficits to exert any deflationary effect.
The use of monetary reserves as the sole reliance to meet small and temporary strains on balances of payments and of other devices to meet larger and more extended and more basic strains is an understandable objective of economic policy and comes close to summarizing the policy underlying the International monetary Fund. Unfortunately, it is not a realistic, feasible or desirable policy.
Under the circumstances there is a strong tendency to rely on reserves too long for comfort yet not long enough for confident diagnosis and reasoned action. CORRECTIVE STEPS ARE POSTPONED IN THE HOPE THAT THINGS WILL RIGHT THEMSELVES (emphasis mine) until the state of the reserves forces drastic and frequently ill-advised action.

Friedman wrote in 1953. Here's some of what I left out between the two final snips:
Reserves must be very large indeed if they are to be the sole reliance in meeting changes in external conditions until the magnitude and probable duration of the changes can be diagnosed … and more fundamental correctives undertaken …, far larger than if they serve the function they did under the classical gold standard. Except perhaps for the United States, and even for the United States only so long as gold is freely acceptable as an international currency, reserves are nothing but this large.

As I said, I don't understand this, but it seems to me that the results of moving reserves from dollar to euro or Another currency, such as gold, could be catastrophic for the US of A. But then again, there's always the option of bombing Iran.

slingshotFunny thing happen at the Coin dealer#1416692/15/06; 18:37:24

My fellow Knights and Ladies it appears that gold once again languishes between the $530 and $550 range. A recurrance we are not unfamiliar with at the lower trading channel.We in the past had all the expectations of gold climbing to infinite heights, only to be bracketed by the ever imposing resistance level.Yet we have forged ahead knowing full well that the fundametals of supply and demand, combined with the hedonistic policies of governmental influence would or will not change till certain castastophy is at our door step. Let us not delude ourselves as many now, for in the future, many will be unable to escape the clutches of the fiat system. Goldbugs are a complex bunch being both optimistic and pesimistic in that they can see the failure of the paper system and its tribulations, opposed to the redeeming value to holding gold in hand. For some of us, myself included, tune into our favorite site to see the price of gold.
Some of you have just entered this area will cringe as the price goes through its correction. A correction that has accented itself as being the distance between the closing price of gold and its 50 day or 200 day moving average. So What! I am more interested in the amount of gold available to be sold on the OPEN MARKET. The world is realising just what the US dollar stands for. DEBT, plain and simple. So Bernacke will increase interest rates to stem the fall of the dollar,only to be met by the the tsunami of US dollars in foreign banks turning into gold or the euro. Crazy?
Markets can be irrational?
So what about the coin dealer? He is a good man and has been in the business for many a year. He stated that gold will not fly till the major investors climb on board at $700 gold. Then look out! Untill then we will have to watch the 50 and 200 day moving average and pray for corrections in the price of gold.

Welcome to all Newbies.
Great Day to be a Goldbug!

ToolieTIH,#1416702/15/06; 19:35:07

I may be missing you point but...

Years ago I used to go to the French-Canadian club in Windsor, Canada for their dart tournaments. I'd always come back with Canadian dollars in my pocket. I'd save them for the next time, for fees and OVs (Old Vienna beer). Those Canadian dollars were my foreign exchange reserves. Likewise the fellow behind the bar would have some US$, his forex reserve. My forex reserves allowed me to pay in the local currency ($CA).

MKJust curious. . .#1416712/15/06; 19:47:15

Did Ron Paul get to ask Ben Bernanke any questions? If so and if anyone has access to a transcript, I would be interested in seeing what the good Congressman might have asked of the new Fed chairman.
Ten Bears"The Words of the Prophets are Written "#1416722/15/06; 20:10:36

Not on the subway walls, (apologies to Simon and Garfunkle) but on the internet. In hindsight we are able to evaluate the correctness of their foresight. Paper Avalanche, (message 81517, 07/26/02) is looking more and more like an accurate prophet. A review of my selected archival records reveals quite a few with "the sight" here at USA Gold.

Thanks fellows, keep up the good work.

Does anyone know what happened to ORO? His extraordinary knowledge could no doubt shed considerable illumination on current financial events.

slingshotSearch for the Renaisance#1416742/15/06; 20:52:33

The years have come and past. Each seeing the rebirth of leaves upon the trees and those who have traveled far rejoice with reunion. Each reunion, sad news of those who have crossed over the river of life. They shall be remembered in the great hearth of the council room and their names forever engrained in the stories told accross
"The Mighty Oaken Table Of Yore"
The castle of the goldbugs shines high upon a knoll for all to see. Within its walls are Knights and Ladies of the golden realm. They have encountered many obsticles along the gold road and have overcome where many would fail.
Tonight I sit upon the castle ramparts and look into a star studed sky. Down below in the courtyard I see my fellow Knights and Ladies as the minstrles play their tunes. All is well. The tourches illuminate the square and voices lift to the open sky accompanied by flute, mandelin
bagepipe and drum.
My trusted companions, Sadie and Wallie, stur as a figure approaches me in a moonlight apexing the wall of the castle. A golden shimmer is reflected and at once I know this person.
"How are you this fine night, Gandalf", I said.
"As well as the stars above us" Gandalf replied.
A few momments passed and then he asked.
"Why do you not join the festivites, Sir Slingshot?"
" As much the same reason you join me here, Gandalf" I replied.
The Wizard drew long on his pipe and blew small smoke rings into the air.
"Take a chair?' extending my hand.
And he sat down beside me. Watching the moon rise and the stars move accross the clear open sky.


The Invisible Handforeign-currency reserves #1416752/15/06; 20:56:16


I said yesterday in
(The Invisible Hand (2/14/06; 18:25:04MT - msg#: 141654))
that foreign-currency reserves can be considered as an investment by monetary authorities in foreign assets, i.e. foreign currency.
The CAD you're using originate from the bartender and are spent only with the bartender. They are just a token (between two parties). The bartender could give you a token in their stead.
Is money not a multilateral, I mean involving many parties?
Are your CAD an investment? Investment in OV?

Today I said in
(The Invisible Hand (2/15/06; 18:10:15MT - msg#: 141668))
that monetary reserves should be used as the primary method of adjusting to changes in external conditions and not, as they are being used, as a shock absorber pending changes in external conditions.
How do your tokens perform this function?

GoldiloxCastle Lore returns#1416762/15/06; 21:17:05


I have been off to a technology convention, ironically at a hotel with the most unfriendly internet access I have seen of late, but am home just in time to witness the return of "The Mighty Oaken Table Of Yore".

Thank you, Sir Slingshot, for "making my day!"

Ten BearsTHE WIZARD OF BUBBLELAND PART 4: Henry C K Liu #1416772/15/06; 21:57:33

worth a look


>The debasement of the dollar, dragging down all other currencies, finds expression in the upward surge of commodities and asset prices, which pushes down global wages to keep US inflation low. This pathetic phenomenon is celebrated as economic growth by neo-liberals.

>David Ricardo (1772-1823), brilliant British classical economist and a bullionist along the line of Henry Thornton (1760-1815), wrote: "On extraordinary occasions, a general panic may seize the country, when everyone becomes desirous of possessing himself of the precious metals as the most convenient mode of realizing or concealing his property, against such panic, banks have no security on any system."

>Greenspan's formula had always been more liquidity at low interest rates, which pushes the monetary system into what John Maynard Keynes called the liquidity trap. This transformed Greenspan from a wise central banker to a wizard of bubbleland.

>While the Fed claims that its monetary-policy measures are designed to sustain the health of the whole economy, it sees the health of the economy's financial heart, the banks in the Federal Reserve System, as the paramount objective.

>interest on money is not to reward the holders of money, but to keep the borrowers working for it.

>In the United States, when house prices have generally tripled in less than a decade, it is evidence that the value of the dollar has declined by a factor of three in the same time period. Consumer prices have not risen by the same amount because of outsourcing of manufacturing to low-wage economies overseas also acts as a depressant on domestic wages. Imbalance in the economy appears if wages and earnings have not risen proportional to prices. A homeowner whose house has increased 300% in market price while his income has risen only 30% has not become richer. He has become a victim of uneven inflation

slingshotInto History you will go#1416782/15/06; 22:05:51

The night was cool and clear and the stars journeyed across the sky. Sunrise began its approach even as the temperature dropped. The tree lines appeared and a soft breeze moved their boughs softly. Small creatures made their way searching for natures food. The Wizard and the Knight marveled at what happens every day. The only difference that they were together to share the momment.
Long gone to bed, the makers of song and merriment. Gandalf the Gold and Sir Slingshot believed they were all alone upon the castle wall. The sun rose and the two were startled by the scrape of a shoe on the rampart. Both turning they could see Sir Goldilox standing in the top of the staircase "Join us" said Gandalf the Gold. Sir Goldilox came forth and stood to one side. The three men now asorbing the heat of the sun from the east.
The Wizard then asked, "What do you see Sir Goldilox?"
"A field, covered in green grass and a golden sun that shines upon it", he answered.
"Remember what you have said for it may be the answer to your wealth", said Gandalf the Gold.


slingshotSearch for the Renaisance#1416792/15/06; 23:41:33

The silence is broken by the fast clatter of hoves. They come from the north and the rider is well recognized by his coat of arms covering his steed. Sir Pritcho, gallops into the gate of the castle. His horse is wet and froth spews from his mouth. He has not gone unnoticed from the castle walls. Sir Pritcho dismounts and shouts, "Let no bed be unturned. Summon all to the Table. I have grave news to tell". He enters the council chamber but can hardly stand still and paces about the Oaken Table. Sir Black Blade is the first to enter only to be greeted in a stern Voice.
"Where is Sir M.K. Other Knights begin to fill the room. Sirs Mikal, Knallgold, Druid , Goldendome and at last, Gandalf the Gold and his following Knights. Slingshot and Goldilox. The sun shines into the chamber and on the table. This Knight stands as strong as an oak. His eyes blaze and all others wait to hear his voice.
Sir M.K. enters the chamber and there is a short silence.
Sir Pritcho faces Sir M.K. and states, Hammerton has fallen!


slingshotSearch for the Renaisance#1416802/16/06; 00:34:15

The words could not have been more inflicting. More than any dagger thrust into a body. Hammerton was a battle cry from which all Goldbugs have come to know. Now, once again the Army Of GATA will wage war against the Dark Forces. This time they will have to drive it to its homeland and destroy it. Yet the Mighty Oaken Table of Yore,was not ready for what Sir Pritcho was to tell Sir M.K.

The Invisible HandAdd a Chinese invasion of Russia#1416812/16/06; 00:39:02

An Analysis of Recent Moves By China Which May Signal Intentions To Invade Russia

By Mark W. Hughes
Infoshop News
February 15, 2006

… China is now poised to move much of its currency reserves away from dollars and into other currencies, including the euro, and into commodities purchases -- predominantly oil.
Now that China is diversifying their currency holdings into euros and other currencies, they can do significant damage to both the U.S. and Japan's economies. By dumping their dollars and Treasury bills, they can send the value of the dollar spiraling downward and seriously weaken confidence in Treasury bills and perhaps spur a dumping of those bills by other nations such as Japan and Saudi Arabia. Interest rates will shoot skyward, property values will soar, inflation will take hold, and the U.S. economy will screech to a halt, …
The danger for China is that the U.S. might take military action against Iran, but if these events are properly timed by China then the economic maneuver of dumping dollars and Treasury bills and the switch to euros by Iran and other OPEC members could blunt any U.S. attempt to get into a costly military confrontation

Got gold?

The Invisible HandNo IOB#1416822/16/06; 03:09:42

Mark W. Hughes of Infoshop News (my previous post) does not even speak of the Irananian Oil Bourse.
France does not know either - see link.
Is this a joke or what?

The Invisible HandAnd China urges diplomacy – How come?#1416832/16/06; 03:25:10

Qin Gang, a Chinese foreign ministry spokesman, told a regular news briefing that "we're extremely concerned about the status of the Iranian nuclear issue".

He said: "It's extremely important for the international community to uphold the consensus on resolving the Iran nuclear issue through diplomatic means and call on the related parties to maintain calm, restraint and patience.

ToolieTIH,#1416842/16/06; 04:20:05

I was afraid that I was missing your point...

My CAD and the bartender's USD were held so that we could facilitate trade. Aside from very short-term currency plays, I doubt that foreign CBs view the USD or govt bonds (bonds IMHO are a vehicle for maintaining value) for that matter as an investment. If we were to take the moneychanger function away from the bartender and give it to a third party, that person would desire a reputation for having ample funds available, if he failed, The bartender and I would seek the services of others. It seems that his profit by holding the stronger of the two currencies, from week to week would be of secondary importance, and any loss in exchange rates could be made up by larger spreads on exchanges. If the moneychanger expected a large change in exchange rates, he'd save in the stronger currency.

The shock absorber effect, which is referred to, is and effort to be prepared for large, unexpected foreign currencies outflows. The problem that foreign CBs find themselves with today is how to maintain reserve values if the face of so much monetary inflation, with the USD being the inflation poster-child.

I still fear that I miss your point. I've often found that in the process of formulating a precise question, the answer becomes apparent.

YES, it does look bad for the USD if all that ‘potential price inflation’ that is locked up in the form of foreign held US govt bonds, is allowed to become price inflation. Who then would dare hold US dollars?

GoldiloxInflationary losses#1416852/16/06; 05:36:45

"YES, it does look bad for the USD if all that ‘potential price inflation’ that is locked up in the form of foreign held US govt bonds, is allowed to become price inflation. Who then would dare hold US dollars?"

One would think that this logic held some weight, but 95% loss in value so far has not curtailed interest in any meaningful way.

Perhaps because the "man behind the curtain" has succeeded in convincing the huddled masses to believe your previous statement:

"bonds IMHO are a vehicle for maintaining value".


Au-somePricing the Risk of War in Iran#1416862/16/06; 07:53:59

@ Ten Bears
Thanks for the link to Henry Liu at the Asia Times. I have read most of his articles. Another Asia Times contributor you might enjoy is F. W. Engdahl at the link. Enjoy.
Snips: "In the past weeks rumors have circulated widely amid growing tensions around a possible bombing strike against Iran. Among the reports—in violation of all precedent since the 1945 USA bombing of Hiroshima and Nagasaki—is discussion of possible deployment of nuclear bombs by either the United States or Israel, to destroy or render useless the deep underground Iranian nuclear facilities."...
"What's going on here? Is a nuclear war, with all that implies for the global financial and political stability, imminent? What are the possible and even probable outcomes?"...

Max RabbitzGerman govt drops Buba gold sale plan#1416872/16/06; 08:02:36

Breaking News....

BERLIN (AFX) - The German government has abandoned plans that would allow the Bundesbank to invest proceeds from gold sales in a special fund, sources said.

Max....The Germans have already experienced what we Americans will come to know.

YGMChina Invading Russia????#1416882/16/06; 08:22:34

Now there is an example of ridiculous fear mongering of the first order by that article writer. It should be VERY obvious China is more interested in Nation building and raising it's status in the world than it is in going to war with anyone. It is also very obvious judging by the extent, intensity and diversity of those multitudes investing $billions in China that war is NOT on their minds.
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Ten BearsPricing the Risk of War in Iran#1416902/16/06; 08:57:16

@ Au-some
Thanks for the link to the Engdahl commentary.

I recall a seasoned observer noting, after the fall of the old Soviet Union, that the world had just become a much more dangerous place. In his view, the rush to fill the power vacuum would bring out the worst in people and nations. Let us hope that cooler heads prevail.

ToolieGoldi -- ROTFLMAO#1416912/16/06; 09:24:06

I never said that "bonds are a GOOD vehicle for maintaining value". Unless maybe you're using them to save up for a VCR.
GoldiloxBonds- VCR#1416922/16/06; 09:35:37

@ Toolie,

touche! Bonds and VCRs make a nice comparison.

GoldiloxDOW 11K+#1416932/16/06; 10:10:41

How can the DOW post 11K again in this environment? It's easy, when you remember that:

DOW 2000 = 11K = 45 oz gold

DOW 2006 =11K = 20 oz gold

What's your measuring stick? If you sold your DOW in 2000 and bought gold, you current value with the US$ measuring stick is 24,300.

That's where the DOW reaches parity with Y2K highs.

Gandalf the WhiteWOWSERS !! #1416942/16/06; 10:21:16

I've been sooo busy that I almost missed that, Sir Slingshot starting up his epic tale telling again, late last night !
I hope that all at the TABLEROUND enjoy these as much as I.
Sir Smeagol certainly should, as they are "fulls of trickeries". <;-)
Keep'm coming, Sir Slingshot!!

FlatlinerJim Willie CB's comments on ETFs#1416962/16/06; 11:14:22


While busy with the pen, a comment is in order about Exchange Traded Funds. The gold ETF is being proved to be a sham, not convincingly so, but enough to anyone harboring a suspicious mind. Stories abound within ETF's regarding shorting gold via futures, buying 10 cents worth of gold per dollar held, lack of transparency, unaccountability under the false guise of security concerns, and avoidance of SEC requirements enough to earn a formal investigation. Eventually, we will learn that on a good day, a fractionally managed gold ETF is right on target with their reality. My uglier view is that ETF's will morph into non-producing hedge firms, simple queer adjunct skeletal illicitly controlled shams linked to the hedged mining firms themselves, whose certificates are fully mixed, those valid vaulted very real with those leased vanished never to be seen again. For smart people to trust the ETF offerings is evidence of utter complete stupidity in my book. Jim Turk's original suspicions might have been met with calls of competitive bias, but no more. His concerns have all been borne out as authentic. He is a true gold patriot. For the precious metal community to embrace the upcoming silver ETF is beyond my comprehension.

Such trust reminds me of the Iraq War and calls of weapons of mass destruction. Now Iran is a nuclear threat. Have we learned anything about disinformation? How intelligent is the gold community? Don't confuse zeal and stubbornness for intelligence and craft. If Fanny Mae launched an ETF for housing investors, would we trust it? A credible argument can be made that the hedged gold institutions (within the establishment of the goomba World Gold Council to manage the gold ETF) is akin to the mafia managing the lending operations for the Teamster's Union retirement fund. How is that working out? The streetTRACKS gold ETF (GLD) will have a similar fate someday, in managed receivership by some official steward.

Flatliner - It may be that many here at the Mighty Oaken Table of Yore understand the ETF issues referred to above. Those new here may want to read Jim's words a second time.

To me, there is no better way to create gold then to create an ETF that tracks gold. This diversion from physical seems to allow paper to remain in control. Paper will go to any length to maintain this control. You can see this as ETFs are springing up all over the place.

Buy physical - one coin at a time if that is all you can acquire!

Side note: If anyone knows where I can find information regarding Jim's comment 'Turk's original suspicions might have been met with calls of competitive bias, but no more. His concerns have all been borne out as authentic.' Specifically, what were(are) his concerns?

GoldiloxGold Medal#1416972/16/06; 11:39:29

The manufacturer for Olympic Gold just told CNBC that "in accordance with IOC regs, the Olympic Gold Medal is made of silver with 6 gms of Gold plating." If I were a particpant, I would cry "FOUL". Billions spent and profits made putting on the show, and then they cheat the winners out of the real prize!

Well, maybe Rich woud still want one!

GoldiloxChina Auto industry#1416982/16/06; 12:04:50

The Chinese auto industry just released figures that showed its exports outnumbered imports by about 44% over the last year. They are NOT only building autos for domestic consumption.

263K units exported
182K units imported

from CNBC

Federal_ReservesLETS GET READY TO BUNGLE!#1416992/16/06; 12:21:30

Oh so strange, here we are in the midst of a so-called economic recovery with such a financial mess
in Washington. Huge fiscal and trade deficits.

These folks don't have a clue! I think they could really bungle this and cause a crisis.

What a mess!


U.S. moves to miss hitting debt ceiling

By Robert Schroeder, MarketWatch
Last Update: 11:24 AM ET Feb 16, 2006

WASHINGTON (MarketWatch) -- The U.S. Treasury acted Thursday to avoid hitting the national debt limit and
said it's "imperative" Congress raise the debt ceiling by the middle of March.

Treasury is suspending reinvestment in the so-called "G-Fund," an investment vehicle for a federal
employees' retirement system. The action will free up $65.266 billion, a Treasury spokeswoman said.
"Without this action we would reach the debt limit today," spokeswoman Brookly McLaughlin said Thursday.
Congress and the Bush administration have been negotiating an increase in the current $8.18 trillion debt
limit. On Wednesday Treasury said it would suspend sales of state and local government non-marketable securities.
Now Treasury Secretary John Snow is urging Congress to raise the debt limit by mid-March.

"I know that you share the president's and my commitment to maintaining the full faith and credit of the
United States," Snow wrote to Senate Majority Leader Bill Frist, R-Tenn., on Thursday.
Beneficiaries of the government retirement fund won't be affected by the temporary halting of reinvestment,

Snow explained to Frist. The fund will recoup all payments, including interest, Snow said.
"Once I am able to make the G-Fund whole, the effect on the G-Fund and its beneficiaries will be the same
as if this temporary action had never taken place," Snow wrote to Frist.

Meanwhile, with the federal budget deficit projected to reach $423 billion in 2006, both Republicans and
Democrats have so far balked at raising the debt limit.

Robert Schroeder is a reporter for MarketWatch in Washington.

mikalSubtly advocating currency change?#1417002/16/06; 12:38:46

One World, One Dollar - Michael Maiello - Forbes - 02/14/06
Musings on common currencies and problems with exchange rates and monetary policy, this brief, somewhat fragmented commentary focuses on Robert Mundell's visions of world cooperation branching out of "currency cooperation".

HenriDouble standard? Msg 141699#1417012/16/06; 13:20:24

Isn't that interesting? The government has a retirement fund funded by taxpayers which produces 65 Billion in returns (that are ordinarily reinvested?) over a period of ...(a month?).

But when it comes to the Social Security funds of Joe Sixpack and his family...yes those same taxpayers, those funds not only do not but cannot produce a return, because they are literally stolen year in and year out for use of govt to pay its bills and help its friends.

It is even more interesting since the govt employees don't even contribute to this fund. With govt employment a major portion of the total employment of the country, I think
I smell the foul stench of the seeds of distrust, disatisfaction and further division among those that apparently have (govt workers), and those that now clearly have not (everyone else).


Ten BearsMore Jim Willie #1417022/16/06; 13:27:00

>Generally, one can confidently claim that the USFed is no better, no worse, than the lying thieves who deceive and line their own pockets on Wall Street. The umbilical cord connecting Wall Street to the USFed is the giant banks, who have large brokerage arms under their corporate umbrellas, permitted since the repeal of the Glass Steagall Act. Since 1999, big banks, brokerage houses, and insurance firms have been permitted to work together, sleep together, share agendas together, deceive together, profit together, and perhaps someday go down together. Such is the pathogenesis of the cancerous encroachment which contradicts the supposed independence of the central bank. Enough, the USFed will hike rates more. They don't need to offer a reason.

>Adjusted for inflation, real wages fell by 3.1% last year, and that means they fell much farther since adjustment for inflation is a total joke. My view is that the USFed hacks want to halt the rise in energy costs and housing prices on the domestic front. The crude oil price is cantilevered in opposition to the USDollar. Keep down the oil price, and therein support the USDollar.

>Gold still competes with the USDollar. Another leap in the gold price might undercut the US$ noticeably and thereby threaten US Treasury bonds generally.

>Also, most experts believe illicit USFed shell agencies operate as tools out of the Caribbean banks. Heck, if it is good for the goose (mafia), it must be good for the gander also (USFed).

KiloGoldilox......#1417032/16/06; 15:14:32

Actually got out of "The Dow" late in '99, 401k, personal holdings, funds, etc., dumped all into Krugerrands and took physical delivery. Have slept much better at night these past many years.


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The Daily Gold Market Report has been updated.

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February 16 (from Reuters) -- Gold futures in New York rallied on fund buying on Thursday, closing near session highs as chart support held and as the dollar slipped modestly on rumors of a bomb threat at the city's biggest bus terminal.

Prices spurted higher after the Port Authority station was briefly evacuated near midday as police inspected a suspicious package. The transportation hub on 42nd Street was reopened soon after the police gave the all clear signal.

Traders said the bomb scare had pulled the U.S. dollar down against the euro and the Swiss franc and likely attracted some investors to the precious metals.

Traders also said a late round of speculative buying before a short session Friday and a long weekend also buoyed the market after gold recovered from its lows below $540 an ounce.

New York metals futures will shut early at about noon on Friday and the market will remain closed on Monday for the U.S. holiday of Presidents Day.

COMEX April gold futures settled up $6.10 at $548.80, near the top of a $549.20 to $538.60 range.

In a second day of congressional testimony, new Federal Reserve chief Ben Bernanke reiterated his upbeat assessment of the U.S. economy and an earlier warning about inflation risks.

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

TownCrierSnow hints at China currency manipulation#1417052/16/06; 16:22:07,_i_rssPage=1f523ef0-c7eb-11d7-81c6-0820abe49a01.html

(FT) February 16 2006 -- John Snow, US Treasury secretary, gave another strong hint on Thursday that his department was likely to formally accuse China of being a "currency manipulator", saying the new exchange rate regime Beijing introduced last summer has not led to greater currency flexibility.

Last July, China revalued the renminbi by 2 per cent and broke its decade-long exchange rate peg to the dollar, linking it to a basket of currencies. At the time, the Treasury welcomed the move and said it would allow a shift to greater currency flexibility over time. But since the announcement, the renminbi has risen less than 1 per cent against the dollar.

The Treasury has sounded out investors and Wall Street traders on the possibility of branding a currency manipulator in the next instalment of the twice-yearly report on currencies, required under the 1988 Trade Act.

"Prudent governments will always try and assess markets and try and prepare markets so markets aren't disrupted," Mr Snow said.

Sabre-rattling on the renminbi may reflect US hopes that China may allow the renminbi to rise to improve the mood ahead April's visit to Washington by President Hu Jintao.The Treasury report is due next month but is likely to be delayed until after Mr Hu's visit.

...Ben Bernanke, Federal Reserve chairman, said he was not concerned about China's large build up of foreign reserve assets, largely held in dollars, which are forecast to rise above $1,000bn this year as China intervenes to prevent its currency from rising, arguing that the US government debt markets are deep and liquid and that securities are largely in the hands of private investors.

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

How much more impetus would you like to see put behind the global transition to a "freegold"-dominated reserve basis for the IMS?

How much longer do you dare hold dollars and delay your next significant gold purchase?


GoldiloxAsian gold market#1417062/16/06; 16:23:51

Wow, $5 in the first hour of Syndey trading, before Hong Kong or Tokyo are even open.

Might be an interesting evening!

GoldiloxSnow and China#1417072/16/06; 16:32:55

So what's he gonna DO? Refuse to sell them any more US Treasuries?

"I'm sorry, BOC, your money's no good here. Whaddaya mean it's our money? Don't be cute! Sure, you'll just buy all of the Asian oil fields. You'll find they're not for sale, just like we did. Now run along and relax your currency peg a little more. We have too many other things to worry about right now."

David LinkleyI smell smoke#1417082/16/06; 17:10:31

Today's housing start numbers (the best since 1973) were of course seasonally adjusted. Unadjusted they were up around 1%. This of course after K&B warned of increased cancellations and some of the other builders noting softer markets in general. Bush, Bernanke and the White House gang are working overtime telling us how great the economy is. Even Snow god bless him is telling us that the "evil" excess savings in the world can be worked off if we try hard enough.

Gold and other hard assets just keep rising even though Wall Street, Barclays and other great world financial institutions are warning us away.

Bernanke doesn't have a prayer. He was handed a bad hand and will now answer to his lord and master Bush to keep the money flowing. For those of you who still have to aquire gold, I suggest now would be a good time. Even the German politicos have given up trying to achieve more gold sales.

The end is nigh, when the dollar begins it's next big decent gold will rocket to $700-800 per ounce. The US is cooked and I can only hope we last through this administration without marshall law being declared.

Farfetched? See what happens when the dollar no longer retains global or domestic confidence.

GoldiloxIt just hit me - DOH!#1417092/16/06; 17:55:08

Snow is PMS'ing about the Chinese Yuan because they have relaxed gold sales restrictions, and letting their minions suck up supply.

Aw, too bad, so sad, YOU'RE HAD!

ToolieA dangerous empire of US debt#1417102/16/06; 18:07:13

Snip: News about the US accounts with the rest of the world should cause grim pause for thought. They show that the United States is digging itself deeper and deeper into debt, with the potential for the global financial equivalent of a nuclear meltdown growing ever closer.

Of course, global accounts must balance and, perversely, some economists claimed that the 2005 figures showed a booming - and not a bust - US economy. Paul Blustein in The Washington Post noted that "the trade gap reflects the strength of the US economy, at least relative to other major trading partners."
The logic of this is that the United States is booming and, therefore, sucks in imports faster than other sluggish economies like Europe, and Japan can afford American goods.
What a turkey of an argument. Perhaps Americans will appreciate the reference to the turkey - because just like a turkey before Thanksgiving, they are strutting around feeling in charge of the barnyard because people are feeding them the best corn.
Yes, America, like the favored turkey, gets special treatment. Before the coming of the US empire, countries doing foreign business settled their accounts in silver or gold, so the outflow of the precious metals would exert a sobering economic effect on a country that was spending above its means.
Breaking with pax dollarium is likely to be painful for everybody. A sharp drop in US dollar values would not only cost the creditors in terms of the value of their reserves, but would also set off a vicious struggle for export markets to replace the United States.
At the end of the day, China, Japan and India will have their factories and their production lines and will have people who are richer and able to afford the goods they are producing, and even be able to trade with each other.
The Americans will have their debts and lots of dollars to testify to a great capitalism whose virtues they ignored. (end snip)
Perhaps the author slights the US export base's competitive dynamism. The current US automakers will be ideally positioned to market toy cars for Asian children. I hope Asian Barbie likes to walk.

OvSToolie.#1417112/16/06; 19:24:25

Don't count America out.
Tons of great research &
new industries are being
created at universities &
laboratories. Yes, we are
loosing the lowbrow jobs,
but give it a few years
and the bloom of highvalue
new jobs will be moving
fast and furious.
A lot of foreign companies
are owned and/or financed
by the West; so capital will
stay strong.
Gold, as in backing up your
word, will be the backbone of
future central banking and
America still has a stash
above and below ground; but
high-tech will reign supreme.
In the meantime:gold & silver
will tie you over the coming
little hurdles. Cheers. OvS

Chris PowellRon Paul cites gold price suppression ...#1417122/16/06; 20:31:32

... in speech to Congress this week.

A GATA dispatch.

To subscribe to GATA's dispatches, send an e-mail to:

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Ten BearsMogambo sez:#1417132/16/06; 20:31:56

For those who may have missed it, the Mogambo Guru has a particularly appropriate rant this week.


the bond markets, around the world, are pricing variable debt at such premiums that all debt, regardless of length, is yielding less than the global price-inflation rate! Astonishing!

As it gets weirder and weirder with each passing day, the reasons for owning gold, silver and oil get stronger and stronger with each passing day.

Chris PowellPeter Grandich says GATA knows best what's happening in gold#1417142/16/06; 20:33:12

Another GATA dispatch.

To subscribe to GATA's dispatches, send an e-mail to:

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GoldiloxResearch#1417152/16/06; 21:07:16


If we can just get the political powers that blackball all free thinkers from the "peer review' system to open their eyes beyond their sacred academic cows, and actually fund some research that is not focused directly on mass population control, we might have a chance.

As long as NASA is spending the bulk of their budget on renovating 25-year-old shuttle technology and supporting the NSA home spying activity from their satellite network, the real breakthrough science isn't gonna come from the "yes men" in the universtities, who are totally dependent on gubmint controlled funding and limited in acceptible "topics".

They still want us to believe that massively powerful hurricanes are caused by warm water evaporation and buy into Sagan's seriously flawed "greenhouse effect", even after the Venusian probes debunked the latter, and a simple surface temerature test can disprove the former.

Too much so-called "research money" is spent directly on marketing the concept that oil is the cat's pajamas and alternatives are not feasible. Real energy research is run outta Dodge for daring to challenge their sciento-religious dogma.

TV has trained us to accept dogma based on credentialed personalities, and completely ignore principles - a habit we must break in order to survive. Truth from a nogody, if reproduceable, is more valuable than regurgitated horse hooey from all the PhD's in the academic clubs.

ToolieOvS#1417162/16/06; 21:08:22

After the dollar looses reserve status US industry will stand a chance. Whatever the ‘next big thing’ is, it'll have to produce exports equivalent to 15,000,000 employees at $50,000 to balance the trade deficit. And, whatever the ‘next big thing’ is, it has to be something that can't be done offshore.

While I'm sure your pep talk is well intentioned, I'm not sure that you appreciate how hollowed out our productive sectors have become. Thirty years of decay will not be reversed overnight. To often I've seen ideas that are viewed as a silver bullet by the top people in an organization. Those ideas eagerly supported by top tier can-do yes men. Those ideas, much more often than not fall flat when they meet reality. The most valuable innovation occurs where things are done, in response to a problem.

But, I'll lift cup to your good thoughts. Cheers.

ToolieGoldi#1417172/16/06; 21:17:19

Well said. Nice post. But, what good is a free thinker if ya can't control him?


David Linkley@OvS#1417182/16/06; 21:38:01

I agree with your assessment that one should not count the US out long term as there are many great strengths left. My concern is they are only strengths if allowed to function in a free market environment. Ask yourself why is the Department of Homeland Security being expanded so rapidly and the economy being centralized as much as possible in DC. What is coming that has the "hidden power brokers" so terrified? They are preparing for mass (as in millions) social unrest. You have cameras and data bases everywhere collecting information on all of us. Efforts are being made to eliminate physical money to be replaced by "digital" money eliminating all privacy. No matter what Bush does congress won't touch him. Why? The pendulum has swung too far to the executive branch and needs to be corrected soon.

Only if the chains of evil fiat money are lifted and sound money put in place can the US return to a producing nation instead of a looting nation. I believe it will take a severe economic crisis and and aroused public to take on the monster we now face.

GoldiloxFree thinkers#1417192/16/06; 21:58:57

@ Toolie,

Let me turn your question around. What good is a free thinker if he is banned for challenging "sacred dogma"?

When I was educated in scientific method (many decades ago), we were told to expect 9 failures for every successful research endeavor. That didn't make the research itself a failure, but rather reflected allowable risk of foward looking research at that time.

Nowadays, R&D engineers are often limited to a 50/50 success rate, so the D part of R&D heavily overbalances the R part. As a result, we have traded in our forward thinking for instant gratification, delivering fewer new ideas and more sequential band-aids to old ideas.

That concept alone has cost the US major leads in many areas of technology in the last few decades. The financial dismantling of the internet technological base and delivery of the same to India is not without ramifications that defy OvS' technological superiority hypothesis.

Back to Bucky Fuller's sociological axiom. When the lion's share of GDP is spent on securing the status quo, and the innovative slice of the pie is continually trimmed in proportion, it is highly indicative of cultural regression.

Let's hope that necessity's criticality can override the shackles of "the status quo", as survival of a viable US industrial base requires it.

We really can't keep doing each other's laundry forever.

tejbearToolie: msg#141716.#1417202/16/06; 22:10:09

Wish I could agree with you.....

I am sorry, but I am not sure the US economy will have much chance after the dollar takes a fall. The reasons are many. First, the US government will face huge domestic debts, both domestic and international. Domestically, the US "unfunded" debt for retirement pensions, Social Security, Medicare, etc. is reported to be around $40 trillion. Add to this the international debt currently of what, $7.5 trillion, and the result is that the US is in deep debt "do-do". Yes the US will be more competitive, but with a crippling debt. Add to that, the baby boomers are retiring. This will exacerbate both the debt and a reduction in the work force. As the US is now very dependent on imported oil, which after the dollar falls, will be sold in euros, dramatically increasing the cost of oil, and operating expenses. And we can imagine that the weather will only get worse, as global warming increases, causing more damage to our already weak commercial infrastructure. I am afraid I see our country limping for a decade or two.

Sorry, wish I could "blow" you some good news, but I just don't see it.

The Bear

GoldiloxCorporate America's Education Myth#1417212/16/06; 22:32:40


The New York Times has a piece today on the latest myth being peddled by our government and the corporate interests who run it. It goes something like this: job outsourcing and declining wages is happening in America because Americans are getting more stupid, and thus the only way for America to stop the bleeding is to produce more students educated in science and math. This is a brilliantly crafted storyline because it both reinforces Americans' concerns about its public school system and, more importantly, distracts from the corporate-written trade policies that are really at the heart of America's economic problems. Oh yeah, one other thing - the storyline is also a shameless lie.


I won't take up more bandwidth with the authors analysis, but I found it pretty interesting. Contrary to the popular myth that American workers lack saleable skill sets, I and many friends and family, belong to the uncounted BLS class of over-educated and underutilized. Many internet and computer pioneers are included in this class that Greenspan and Snow call "lacking in education". Well, the unaddressed trade deficit is certainly "taking us to school."

GoldiloxInvestors pin hopes on sustained China gold rush#1417222/16/06; 22:41:57


By Geoff Dyer in Shanghai
Published: February 13 2006 04:15 | Last updated: February 13 2006 04:15

Rivalry between China's two main cities is rife, but Shanghai's Old Phoenix jewellery store is doing a roaring trade in small gold bars embossed with the logo for the Beijing Olympics.

At just under $2,000 (€1,700, £1,150) for a nugget the size of a cigarette lighter, there are plenty of cheaper 2008 Olympics memorabilia on Shanghai's main shopping street, but that has not held back demand. "There will be a new bar every year until 2008 and many people want the complete set," says a salesman.


Sec. Snow better get the Chinese currency fully "buggered" bofore they suck up all the gold supply.

tejbearDavid Linkley #141718#1417232/16/06; 22:45:22

Sadly, I do agree with you. Dudya and gang are working hard at eviscerating the Bill of Rights, Constitution and due process. Conservatives now support a regime that spends so much money that is makes most Democrats blush. American soldiers dying left and right, with no end is sight, and the moron keeps telling us we are winning, while charging the war, new weapons, etc., all the while conducting giveaways to the rich and businesses.

What do you think the American people will do when they find out how they have been lied too, over and over, costing them their retirements, standard of living and a dramatically reduced quality of life? Rioting, revolution, who knows. However, it may play out that the press will successfully transfer the blame to Iran, China or some other fall "reason".

All because of fiat money.

As we are past the point of no return, the future bodes ill.

Good luck,
The Bear

GoldiloxThe Mad Scientist and the Irrationally Exuberant Frog#1417242/16/06; 22:57:27


Let's start our discussion with a pop quiz. Alan, the head of a central bank, said the following recently:

"People need to stop using their homes as source of cash. That's why we will keep making these warnings and if necessary, take further action. (The Central Bank) can increase interest rates and we can do it in a way that really hurts."

Which central bank was Alan the head of?
(a) U.S.A. (b) Eurozone (c) U.K. (d) Australia (e) none of the above

If you picked (e), congratulations. The above quote is attributed to Reserve Bank of New Zealand Governor Alan Bollard. Too bad we don't have the right Alan!

Anyhow, here is how we expect the future to unfold. First of all, we expect the economy to slow in 2006. Why? Because that is exactly what has happened every time in the past following a Fed tightening. After all, one could argue, that is the very purpose of raising the interest rates. Higher cost of money leads to less borrowing, and consequently, less spending.

However, this time is somewhat different. Today's consumer exuberance is powered by the unprecedented convenience of ATMs lodged in a hundred million American homes! It will not yield to a little "measured" tightening by the Fed. Sure the higher rates are beginning to hurt. Combined with higher energy costs and increased credit card and home equity payments, the consumer is feeling squeezed. But remember there is a half a trillion dollars of "open-to-buy" on Home Equity lines of credit. There is a similar amount available on credit cards. Confident consumers are not going to voluntarily cut back spending to compensate for the higher cost of money and energy. Imagine the slogan, "Just say NO – to spending"! That would be decidedly unpatriotic!

So what we expect instead is the following in 2006.

1. As a consequence of the increased costs of money and energy, combined with unparalleled debt burdens, consumer delinquencies and defaults will start rising dramatically. Note that every one of Greenspan's tightenings by more than 100 basis points (in 1989, 1994, and 1999) have had the effect of driving credit card loss rates to new records. This episode is 325 basis points and counting.

2. The regulators, alarmed by these trends, will lean on lenders to raise lending standards. This will diminish the flow of credit to marginal borrowers. This is the segment that has had the most explosive credit growth in the last 5 years … sub-prime, low/no documentation, interest only, negative amortization, etc.

3. Restriction of credit at the margin will finally put a crimp in the borrow and spend dynamic. But it will be the end of 2006 before an appreciable GDP slowdown becomes visible. However, during 2006 house prices will fall, especially on the two coasts. The stock market will also decline due to the earnings pressure on financial stocks exposed to consumer defaults. Later in the year, stocks will fall broadly as the consumer slowdown becomes apparent.

By the end of 2006, while presumably Sir Alan is watching a glorious sunset on a warm tropical island, pina colada in hand, he will finally be able to proclaim an end to the decade of irrational exuberance he unleashed.

Ten BearsLaRouche, distilled#1417252/16/06; 22:58:47

since 1971-1972 the physical economy of the U.S.A. has been collapsing at a generally accelerating rate, throughout the 1981-2005 interval to date.

there had been three sets of developments of most notable, qualitative significance within this process of degeneration of the world's economy as a whole. The first were the effects of the August 1971 floating of the U.S. dollar by the Republican Nixon Administration, and the subsequent role of Nixon's George Shultz at the Azores monetary conference, where the original IMF system was replaced by the lunacy of a floating-exchange-rate system. The second crucial development was the wrecking of the internal economy of the U.S.A. by the 1977-1981 U.S. Democratic Carter Administration, under the direction of Zbigniew Brzezinski's lunatic rampages as U.S. National Security Advisor. The third, and most ruinous development, has been the post-October 1987 role of Alan Greenspan in his assuming the function of U.S. Federal Reserve Chairman. At each of these three points, there was an acceleration of the previously prevailing functional rate of general monetary inflation, to rates now far beyond the threshold-levels already determined by the combined effects of the 1964-1972 U.S. War in Indo-China and the willful actions of the United Kingdom's disastrous first Harold Wilson government in collapsing that nation's physical economy, and unleashing factors of monetary chaos into the existing Bretton Woods System.

Thus, it is the effects of what is now, the recent nearly four decades of shift from the world's leading science-driven agro-industrial economy, to a "post-industrial services" economy, and the wasting away of the productive facilities and basic economic infrastructure upon which our former relative excellence depended, which have ruined us, bringing us now, thus, to the brink of an awful self-destruction.

The poor are not a threat to their neighbors, but their poverty is. The poorly educated are not a threat to society, but their ignorance is. As the fall of the once-great culture of Athens warns us today: that indifference to truth which is known as Sophistry, when promoted by some, as the Congress for Cultural Freedom typifies a modern imitation of ancient Athenian Greece's Sophist degeneration, is a threat to the welfare of everyone.

tejbearGoldilox #141721#1417262/16/06; 23:02:12


They are teaching us a lesson. Wish I could find the article were an "out of work" engineer was complaining about not being able to get a job at Walmart…. He was over qualified. Who cares how great your education is if the job you are qualified for is in China? I haven't checked lately, but in India, a programmer starts at $5,000 per year, verses in the US, were a starting programmer earns $50,000 per year. Managers of programmers in India only ear $25,000 per year, and live like kings. I am not interested in taking a 70% pay cut to be competative with a chinese middle manager.

Another recent article pegged the unemployment in the US at 8% to 9%, not the government approved number of what, ~3.5%. Social Security receipts for January are down what, 65% from one year ago. Yet Wall Street pines how wonderful things are....

Sadly, its beginning to look like the tipping point might be this year, what do you think?

The Bear

OvSDavid.#1417272/16/06; 23:06:34

I maintained an apartment
in Mid-Manhattan for over
38 yrs. Sold out.
Tomorrow I have to go there
for business. In the back
of my mind I wonder about
a Weapon of Mass Distruc-
tion being detonated or
released while I'm there.
I've talked to some of my
Manhattan friends and all,
without exception feel the
potential of being wiped-
out with such a weapon.
I'll bet you good money that
more than half of all Man-
hattanites would rather
live without than within
Manhattan IF they only could
do so.
Manhattan and Washington DC
are prime target, announced
by Al-Qaida.
Why do you wonder why the
Home Security is being expan-
Just see this development
without the paranoid viewpoint
that it is just a matter of
control. There are over 80
suitcase bombs missing from
the Russian arsenal. Each one
of them could wipe-out Mid-
town Manhattan and more.
Mind you, a suitcase bomb.
Can't you immagine how easy
it would be to infiltrate
such a device? And how diffi-
cult it would be to stop such
a horrific act?
And you wonder, why surveillance
cameras are popping up all over
the country?
Freedom can only survive in a
cetain environment. We don't
have that condition now. Let us
pray we can have it in the
future. This planet is ONE. If
we like it or not.
All we can do as individuals is
make it a livable place in our
local environment. Give it your
all. Cheers. OvS

GoldiloxDollar fall#1417282/16/06; 23:19:37

@ tejbear,

If the web bots are right again, this year bodes another 30% drop for the dollar. Of course, they do not measure events, but rather, mass emotive expectations. Still, they have been remarkably accurate.

The real fears I am seeing in print come not from the nuclear or energy fronts, but from the potential for foreign lendors to put the margin squeeze on US debtors.

Notice another set of US ports of entry "sold" to foreign administrators, just we're seeing midwest toll roads sold to a Dutch/Spanish interest.

US infrastructure is being sold right out from under us, and the banksters' police forces will enforce their ownership to maintain their non-SSI pensions.

It's not accidental that government employees are out of the SSI system, as TPTB would not want them to empathize in any way with the plight of the American industrial workers.

mikalRenminbi immaterial to trade relations: China#1417292/16/06; 23:53:32

Experts: US Trade Deficit Not Linked With RMB Value - 02/17/06 - People's Daily Online
"Li also proved with data, that 58% of China's exports were made by foreign-funded firms, especially U.S. owned, and 83% of China's surplus went to those same firms."
Another point made is the U.S. saw huge growth in exports to China during the time of the fixed peg to the dollar.
Due to this, and the occupational, manufacturing and income shifts discussed earlier, the U.S. trade deficit requires something more than a dollar devaluation relative to other currencies. (And it's looking you right in the face! Note the background to this white forum page is the outline of gold rounds.)

GoldiloxPoG#1417302/17/06; 03:33:55

For those bemoaning the current $20 price correction, the YTY change should help keep the "eye on the prize."

Gold us up $119 over Feb 17, 2005.

SundeckOlympic versus trash#1417312/17/06; 04:18:45

Ref #141722

Now isn't that curious...instead of spending hard-earned dollars on some trashy trinket that is going to instantly lose its exchange value the second you buy it and remove it from the shop, some Chinese are buying gold bar olympic memorabilia...

Ok...maybe you pay more up front (premium etc), but in ten years, or thirty years or fifty years...when you are showing it to your grand children...what is its exchange value going to be relative to the host of other trashy items that normally get sold on occasions like this.

Quite a nice combination of "sentiment" and "investment nous", don't you think?


SundeckMedley#1417322/17/06; 05:30:31

1. Did anyone else notice that it was reported, a week or so ago, that J P Morgan was under investigation for attempting to rig the copper price back in the 1990s. Very liitle mention anywhere...

2. Bernanke, I thought, spoke somewhat nervously during his appearances before the inquisitors...perhaps not surprisingly. A smooth transition was what was called for and that is what appears to have occurred. After all, maintaining CONFIDENCE in the financial/economic community is perhaps the major role of the FED matter what! (Can you imagine a free-speaking chairman who really airs their concerns about the state of the national finances? Refreshing, maybe, but how long would they last in the position?)

3. Credit card borrowings in Australia are at all-time highs.

4. More and more references in the press to "high oil prices", but few references to "low dollar values". Remember, oil is now "the standard"...and the dollar floats around it, not the other way around... Even the Australian Treasurer (Costello) has recently raised concerns about oil and commodity prices remaining high and warning people that prices will eventually decline. Yes, increasing supply will help remove upward price "pressures", but he made no mention of the role of a declining US dollar... It seems to me that these two factors (commodity supply and dollar supply) have to be considered together whilever commodities are priced in US dollars. Then there are the separate reference points - a barrel of oil (getting scarce) is one...and Matt Simmons feels that a "fair price" for that may well be several hundreds of US dollars. On the other hand a tonne of iron ore (still very plentiful) provides a different reference level for the dollar. Then there is gold...yet another reference level for the dollar...

5. Ref #141677...Henry C K Liu raises and discusses good another of his long, rambling offerings. (A prolific writer, but I do wish he would spend more time drawing things together. Pot calling kettle "black"?) "Uneven inflation" indeed... The term "inflation" is expected to do altogether too much work. People talk about it as if it is a specific, unique phenomenon that can be characterised by a single number (the so-called "inflation-rate" in percent) is not so simple. There is no such thing as a unique "inflation-rate".

6. I was apt to ignore all the talk about an attack on Iran...until I saw an article on this very subject in the Austalian Financial Review recently...holy molly, are things getting THAT crazy? All the "western" attempts to discourage Iran in its nuclear aspirations would be a tad more convincing if accompanied by a committment by said westerners to renounce nuclear weaponry forthwith. Imagine a France without nuclear weapons...or a Britain...or a Russia...or (dare I say) even a USA! Naive you suggest? No, the present circumstance is naive. Renouncing nuclear capabilities is what I would call "leadership"...

7. Back to the present...Spot and the silver stallion are off on a little canter together it seems...will they be "swatted" when NY opens? Tell you to bed...zzzzz


The Invisible Handforeign- currency reserves#1417332/17/06; 07:33:33


You said in
(2/16/06; 04:20:05MT - msg#: 141684)
I still fear that I miss your point. I've often found that in the process of formulating a precise question, the answer becomes apparent.


What if we started by agreeing that in the days of the real gold standard, there were no foreign currencies, a fortiori no foreign currency reserves? There was only the "100-percent-metallic-reserve system"
George Reisman says that the supporters of the 100-percent-reserve-system can be divided into two groups. Those who claim that the issuance of fiduciary media is tantamount to counterfeiting and is fraudulent. And those who claim that if the issuance of fiduciary media is conducted openly, with deception – that is, if it is no secret to the owners of banknotes and checking deposits that the backing for them is debt – one cannot outlaw the practice
(George Reisman, "Capitalism – A Treatise on Economics", Ottawa, Illinois: Jameson Books, 1998, pp. 514-515)

Nowadays, central banks determine their reserves by a game of darts.

What about this? Governments bonds are "safe" precisely because the government can always issue money to repay them even to pay the interest. So foreign currencies/bonds are useless as reserves.

Here's how Mises starts section I "Types of Banking Activity" of Chapter 15 "The Business of Banking" of his Book "A Theory of Money and Credit" (p. 293 of the Liberty Classics edition):
The business of banking falls into two distinct branches: the negotiation of credit through the loan of other people's money and the granting of credit through the issue of fiduciary media, that is, notes and bank balances that are not covered by money.

Again my apologies if none of this is to the point, but I wanted to thank you for your reply of yesterday.

ToolieTejbear, Goldilox & TIH#1417342/17/06; 08:12:56


The dollar loosing reserve status is not just about the dollar falling in relation to other currencies. Loss of reserve status would free other nations from having to accumulate dollars to conduct business – It would take the target off the back of US producers. Loss of the US’ singular reserve status would necessitate that ALL CBs denominate their reserves in terms of their trading partners currency (and likely gold for ‘deep reserves’ or less mobile reserves if you prefer). It would necessitate that the US addresses its current account deficit. Further yet, it would restrain the reckless speculation of US companies that put their supply chain in a Communist nation – the easy money that has enabled the transfer of production to Asia would be gone and future investment would be made with funds that are dearer. Those investments would be made in places with a better record for observing property rights.

No, it's not a return to the good old days, but it does offer a fighting chance to US producers, something they don't have now. SS and Medicare will not be the generous programs that we see today. But perhaps they could survive to some degree once our fixation on policing the world while protecting the dollar has given way to a military that focuses on protecting the country. The loss of the dollar as the singular reserve currency is about more that just falling in value.


What good is a free thinker if ya can't control him? – well he's no good to those that demand orthodoxy. I was being a smarty pants. We're in agreement. I'll get the hang of typing out **** eatin’ grin yet.

Re: 50/50 success rate in R&D. Wow, sounds like the auto engineering biz. Have they put the posters on the wall yet that state "To dream, is not in your job description"? If not it's coming.

You have nothing to apologize for Sir, I'm no economist either – Unemployed Machinery Designer.

Your quotes:
"Governments bonds are "safe" precisely because the government can always issue money to repay them even to pay the interest. So foreign currencies/bonds are useless as reserves." -- Perhaps useless overstates it, those foreign currencies still facilitate trade. As Sir Belgian used to say; Gold is for saving, currencies are for trading.

"if it is no secret to the owners of banknotes and checking deposits that the backing for them is debt – one cannot outlaw the practice" -- I disagree, OPEC could outlaw it. And likely will, once sufficient military protection is available.

I'm sorry, I don't see the connection between the Mises quote and CB reserves.

You're quite welcome.

TownCrierHoliday on Monday#1417352/17/06; 09:27:31

The brokerage office of USAGOLD - Centennial Precious Metals will be closed monday for the President's Day holiday, so get your orders in today!


KiloTrivial Pursuits#1417362/17/06; 09:48:11

Sometimes we spend too much time trying to understand individual pixels when we need to spend a little more time on the whole picture.

Money Masters Part 1:

Money Masters Part 2:



FlatlinerJust watching#1417372/17/06; 10:52:47

NYMEx Issues for February.

Silver 314 (up from 200) or 1,570,000 a jump of 570,000 ounces.
Gold 7,198 (up from 6,954 last posting) or 719,800 ounces of jump of 24,400 ounces.

Total Eligible in golden warehouse 2,537,206 ounces (up from 2,482,998 last posting). Total registered 4,991,704 (Unchanged).

The Invisible Handdefinition of money #1417382/17/06; 10:54:56

For Mises, money is a COMMODITY whose economic function is to facilitate the interchange of goods and services. And money is always an ECONOMIC GOOD.
(Ludwig von Mises "A Theory of Money and Credit" , pp. 46 and 101 of the Liberty Classics edition)

For Reisman,, money is a GOOD readily acceptable in exchange by everyone in a given geographical area, and is sought for the purpose of being reexchanged.
(George Reisman, "Capitalism – A Treatise on Economics", Ottawa, Illinois: Jameson Books, 1998, p. 142)

Mises wrote before Nixon ruled. Reisman, who dedicates his book to his teacher, Mises (and his - the former's - wife), after Nixon ruled.

mikalCredit derivatives will never be ready for a "major credit event"#1417392/17/06; 11:56:03

Banks Plan to Settle Default Swaps in Cash, Avoiding `Squeeze' - Feb. 17 - Bloomberg - Snippit: "Debt-insurance contracts may be settled in cash, averting a rush for bonds when companies default, under a plan being proposed today by the International Swaps and Derivatives Association.
The market for credit derivatives, dominated by credit- default swaps, expanded fivefold in two years to about $12.4 trillion, according to ISDA in New York. Banks sold so many of the contracts that when auto-parts maker Delphi Corp. defaulted in October, there weren't enough bonds to settle with, causing prices for the notes to rally.
``Lurking in people's minds is the possibility of a major credit event,'' ISDA Chief Executive Robert Pickel said in an interview yesterday. ``Our plan is to have a series of meetings and get at least the structure of the process done by June 20.''
No one knows just how much debt is insured through credit- default swaps because the contracts are privately arranged and aren't listed on any exchange. Federal Reserve Bank of New York President Timothy Geithner and 14 of the largest banks including Goldman Sachs Group Inc. and JPMorgan Chase & Co. met yesterday to review plans for improving credit derivatives settlement."[No one knows? There must be a mathematical formula complex enough to at least model it!]

"Credit derivatives are the fastest growing part of the $270 trillion market for derivatives, financial obligations based on interest rates, the outcome of certain events, or the price of underlying assets such as bonds. [That's way too few "financial obligations". TPTB owe us at least 10 times that much in compensatory damages alone.]

"Banks told regulators yesterday that they met a January goal of reducing the amount of credit-default swap transactions awaiting signatures, easing concern that sloppy bookkeeping may set off a financial debacle.
Regulators, including the Fed and the U.K.'s FSA had warned that the banks weren't coping with administration, with some credit-default swaps left undocumented for months.
``All 14 major dealers have met the Jan. 31, 2006, commitment to reduce by 30 percent the number of confirmations outstanding by more than 30 days,'' the Fed said in an e-mailed statement after the meeting in Manhattan. ``As a group, a 54 percent reduction was achieved by the end of January.''"[Good luck boys. I'm sure all that busy work will at least let you sleep at night, for now that is.]

silverton3All gold reserves.#1417402/17/06; 12:19:18

Has anyone calculated what the price of gold would have to be to provide all gold reserves. Wouldn't the price have to be over 10k/oz?
TownCrierUPDATE: Iran, China Near Multibillion-dollar Oil Deal: Reports#1417412/17/06; 13:40:51

HONG KONG (Dow Jones) -- China and Iran reportedly are near the final stages of a multibillion-dollar oil deal under which the mainland's state-owned China Petrochemical Corp., or Sinopec Group, would take a 51% stake in the development of an oil field along Iran's southern border near Iraq.

Mainland officials are due to visit Iran and sign an agreement regarding the Yadavaran oil field, possibly as early as next month... ... the two sides are trying to conclude the deal before international sanctions are imposed on Iran for its nuclear ambitions.

India's state-owned Oil & Gas Corp. would assume a 20% stake in the project, and Iran's National Iranian Oil would take the remaining 29% stake.

...Under the terms of a 2004 preliminary agreement, Iran will allow Sinopec to play a role in developing the field in exchange for agreeing to purchase Iranian liquefied natural gas for 25 years starting in 2009.

Sinopec Group is the mainland parent of Sinopec Corp. which has shares listed in New York, London, Hong Kong, and Shanghai.

Analysts in Hong Kong said it was unlikely the listed arm would receive any commercial benefits from the deal because of the political sensitivity of the project.

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



TownCrierGold for Investment Portfolios?#1417422/17/06; 13:47:09

Bloomberg today reports that Gold gained in London as investors sought to diversify their portfolios and get higher returns.

Investors are buying gold because it's outperforming stocks and bonds. Gold rose 90 percent in the five years to the end of 2005, while the Standard & Poor's 500 Index returned 2.7 percent with dividends reinvested. An index of Treasuries maturing in two years or more returned about 30 percent including interest reinvested, Merrill Lynch & Co. indexes show.

``There is still some fund money waiting to find a destination in commodities,'' Michael Widmer, an analyst with Macquarie Bank Ltd. in London, said in an interview today. ``Gold is an anti-cyclical commodity, and the funds want to own it to diversify their portfolios.''

...Fund investments in commodities will soar almost 50 percent to $120 billion this year, Standard Bank in London said in a report Feb. 2.

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

Isn't it time that YOU added gold to your portfolio, too?

Call USAGOLD-Centennial TOLL FREE for consultation and best prices.


TownCrierGold's worth endures through the ages#1417432/17/06; 13:53:18,0,4706945.story?coll=hc-headlines-local-wire

GUILFORD, Conn. -- Over the next week, the phrase "going for the gold" will play in your head over and over.

Yes, Olympians are going for the gold. But who isn't these days? At about $570 an ounce, it's the highest since 1980, when it peaked at about $850 an ounce.

Throughout history, currency has come in countless forms - tobacco leaves, salt, rocks - but there's no matching gold in terms of endurance. We used to trade in livestock also, but we don't see champion Olympians with chickens around their necks.

Fort Knox, which has held the U.S. Gold Bullion since 1937, holds about 147.3 million ounces of gold. This would have been a good indication of the economy's health at one time, but we did away with the gold standard in the early 1970s.

Not everyone thinks it was a good idea.

Though economist John Maynard Keynes called the gold standard "a barbarous relic" about 70 years ago, former Republican vice presidential candidate Jack Kemp and Steve Forbes have called for a return to it.

..."For the first 3,000 or so years of human history, gold was, for a variety of still-valid reasons, humanity's money of choice."

So hundreds of athletes will put themselves in harm's way, shooting down ice tunnels and flying off ski jumps, all for a gold (gold-plated, actually) medal. Why not? Gold has surely spurred more drastic calls to action.

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

Rather droll, but in the news nonetheless.


ToolieAussie gold sales#1417442/17/06; 13:57:28,5744,18182396%255E31478,00.html

Snip: Finally a footnote to last week's column on gold.
Ever-alert Labor Opposition spokesman Lindsay Tanner asked Macfarlane how much better off we might be if the Reserve Bank had not sold two-thirds of its gold stock in 1997.
The governor obliquely acknowledged the bank was now showing a loss on the sale by saying it was ahead for 8.75 of the past nine years. He also said the bank did not sell its gold to maximise its profits. But he did tell The Australian in 1997 that holding gold was costing the country about $150 million a year and would have gone on doing so. (end snip)

"He also said the bank did not sell its gold to maximise its profits."

I suppose that protecting your ability to issue money may be more important than maximizing profits on gold sales. Or, keeping the oil flowing. What else?

USAGOLD Daily Market ReportPage Update!#1417452/17/06; 14:29:20">
The Daily Gold Market Report has been updated.

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FRIDAY Market Excerpts

February 17 (from MarketWatch) -- Gold futures closed higher Friday on safe-haven buying amid a fresh threat of violence in Nigeria and Iran's continued defiance of calls to stop its uranium-enrichment program. The metal also found support from data showing a bigger-than-expected rise in wholesale inflation in January.

COMEX April gold closed up $5.80 at $554.60. After a volatile week, the contract managed to eke out a 0.2% gain from last Friday.

A Nigerian group has threatened "total war" against foreign oil companies operating in that country, according to the BBC. The threat comes after months of attacks on pipelines and the recent kidnapping of four foreign oil workers. Nigeria is the world's eighth biggest oil producer. The group, which calls itself The Movement for the Emancipation of the Niger Delta, has called for all foreign oil workers to leave the region by midnight tonight, said the BBC.

Meanwhile, tensions surrounding Iran's nuclear research program are growing ahead of a meeting with Russia scheduled for Monday. The talks will focus on a Russian offer to allow Iran to enrich uranium within Russia -- and attempt to better oversee the Iranian program.

"The gold market has been looking for more uncertainty and we are seeing it this morning," said Kevin Kerr, editor of Global Resources Trader.

Investors are looking at gold as more of a buying opportunity after its steep decline than a commodity preparing to crash, "and this is prudent," he said.

"After all nothing has fundamentally changed for gold and now technically we have had the correction we needed to see and new buying can pour back in."

Peter Grandich, editor of The Grandich Letter, agreed that the bull market is intact. "Hard as it would be to take it, gold could fall to the high 400s and still not have violated the bull run. But have no fear; I don't think we'll get even close to that."

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

Flatliner@All gold reserves#1417462/17/06; 14:38:23

Silverton3, I came across this linked article where the author made, what looks like, the calculation that you ask for, but against just the US currency. I've read the article a number of times and it seems reasonable – but unlikely. It would be interesting, yet probably futile, to perform the same calculation regarding all currencies. Would it be more or less? I don't know.

But, if you're asking what the price of gold would have to be in order to act as the only true reserve, what is a most interesting question and, undoubtedly, most illusive. How would it act as a reserve? Like it backs the Euro? Or like it used to back the Dollar?

In any case, I do hope that the link helps. If you actually make these calculations that you are looking for, please point us to your conclusions so we might all learn.

silverton3all gold reserve price.#1417472/17/06; 16:34:25

Thank You. A price of 35k/oz just for the U.S. Perhaps we can take some foreign gold and bring it down to 25k/oz.
The Invisible HandBernanke denied it#1417482/17/06; 16:58:16

Oops, I didn't see this. (my advance apologies if this was posted before). It was denied on Thursday. Yes, Y2K , yes people were working on it. But who's ‘working’ on this problem, at least problem for the greenback?

China dollar holdings 'no risk'
US Federal Reserve chairman Ben Bernanke says he sees no sign of a major shift in foreign central banks' plans to hold US dollar assets.

Flatliner@all gold reserve price#1417492/17/06; 17:19:19

Acquiring more gold. That is an interesting concept.

It seems to me that the current price of gold is directly tied to future commitments on gold (Open Interest in the futures markets). At least that's the way it appears today. At the same time, we all know, there is more gold committed on paper then what can be delivered for many years. What if this paper gold can't make it to market? What then?

So, I'm ‘just watching’ to see if and when that future gold doesn't show up, will the price at that time reflect the ‘present’ shortage of gold? That ‘present’ shortage of gold today is not reflected in the price.


The Invisible HandCredits to TownCrier#1417502/17/06; 17:25:39

TownCrier (2/16/06; 16:22:07MT - msg#: 141705)
Snow hints at China currency manipulation,_i_rssPage=1f523ef0-c7eb-11d7-81c6-0820abe49a01.html
(FT) February 16 2006 –
...Ben Bernanke, Federal Reserve chairman, said he was not concerned about China's large build up of foreign reserve assets, largely held in dollars, which are forecast to rise above $1,000bn this year as China intervenes to prevent its currency from rising, arguing that the US government debt markets are deep and liquid and that securities are largely in the hands of private investors.

The BBC (my previous post) seems to be wording this differently, i.e. morestraightforwardly.
Is the government-funded BBC more anti-dollar than the establishment-funded FT?

DruidTHE NO-PROFIT WORLD OF TOMORROW#1417512/17/06; 17:54:59

TownCrier (2/17/06; 13:40:51MT - msg#: 141741)
UPDATE: Iran, China Near Multibillion-dollar Oil Deal: Reports

Druid: To piggyback on TC's previous post, the commentary below suggests that this newly developing relationship encompasses much more then what most Americans know or understand. It will be interesting to see if important Chinese Officials are present for the opening of the Iranian Oil Bourse or if a site inspection of the proposed oilfields will take place during the same time frame.


The Chinese government plans to build a pipeline from Iran to China, passing through some of the "-stans," the former Russian republics. Not long ago, the Shanghai Co-operation Council (SCO, whose members are Kazakhstsan, Kyrgyzstan, Tajikistan, Usbekistan, Russia and China) has agreed and signed a pact of mutual defense - demonstration of this alliance took place August 18 to 25, 2005 (when peace mission 05 was conducted.) The SCO members also agreed to ask the US to withdraw their troops from their new military bases in Central Asia, and to set a time table to this effect.

When you combine these facts with the rising protectionist atmosphere in the US congress, where they have introduced legislation to erect 27% import tariffs against Chinese goods – and we all know that tariff wars lead to a more dire potential than a no-profit economy—it introduces the potential of armed conflict.

SundeckMore on Ron Paul's speech...#1417522/17/06; 18:11:44 posted by Sir Chris Powell the other day... this time from the AntiWar blog (see link).

...'tis going to get mighty interesting with China and India and other countries laying down oily footprints in Iran as fast as they can.

...And this is worth a read at ResourceInvestor...

It is our view that an inverted yield curve does indeed signal a slowing economy. We are afraid, however, that even as the Fed is likely to raise rates further, it will not forestall inflationary pressures. We are rather concerned that foreigners may be less inclined to finance the massive U.S. current account deficit as the economy slows. In this environment, gold may continue to do well, and the dollar may continue to be under pressure...."

Sundeck: ...and the FED is going to monetize debt (if necessary) as fast as it's little choppers can carry the bundles of green(span)backs...what was that expression? FED going to exercise "creative measures" to stabilise the long end of the yield curve? Keep long-term (=housing) interest rates low...God knows...too many degrees of freedom...Yiiii...glad I don't work at the FED...


ToolieThe latest from John Perkins (economic hit man)#1417532/17/06; 18:28:49

Snip: This gave great support to all of the other movements in Latin America. And these other candidates, people like Evo Morales, really looked to Hugo Chavez as an example of someone who's had the staying power. He's been able to stay there, despite the fact that the administration has spoken so strongly against him and is so angry.
The other side of the coin is that Brazil is a world power. It's one of the largest economies in the world, and it produces a tremendous number of military weapons that are used worldwide. And Lula, of Brazil, he's backed off a bit. And there's an interesting story that I know behind that.
JOHN PERKINS: Well, I'll get into that. But he's backed off a bit. But he still – he's made alliances with Chavez, with Kirchner of Argentina, with Morales of Bolivia. They've all agreed that if the United States does anything drastic, they'll stand together and oppose us. So there is this coalition that's happening. It's quite loose. But nonetheless, there's a tremendous amount of support there. (end snip)

If you've not yet read what Perkins has to say, take a trip to the link.

R PowellETF#1417542/17/06; 18:57:03

Silver ETF info
R PowellMore info#1417552/17/06; 19:00:52

ETF proposal draws opinions.
SundeckRon Paul's speech...and it WAS almost totally ignored...#1417562/17/06; 19:04:13

...just as Sir Chris Powell suggested (see link):

"...Ron Paul...gave a speech in Congress that
was so important that it is sure to be ignored."

A google search unearths just three (3)references:

1. blog

2. Lew Rockwell

3. Hawaii Reporter

Man...that's what you call a popular story!

(My tongue-in-cheek question is: "What the hell is wrong with the Hawaii Reporter?" Oh well, perhaps the story will be withdrawn...)

I'll bet if one of Britney Spear's artificial fingernails fell off while squeezing zits, it (the story) would be plastered over most of the newspapers and web-sites in the land...

...but THAT would be important to the's and women's cosmetics, artificial and exagerated drama, juvenile obsessions and acne...Yep! And since not everyone is wearing artificial fingernails yet...hey there MUST be potential for growth in GDP...



Toolie@ Sundeck#1417572/17/06; 19:28:07

"...Ron Paul...gave a speech in Congress that
was so important that it is sure to be ignored."

Absolutely right. I gives one cause to wonder about the mechanism at work in the editing room.

Perhaps, a third world, ‘state controlled’ paper will see fit to comment. It'd be interesting to know if it shows on a Google search done in China eh?

ToolieChavez warns US on oil after Rice remarks#1417582/17/06; 20:37:14

Snip: "The U.S. government should know that if they cross the line they will not have any Venezuelan oil," Chavez said at a public event. "I have started taking measures in that respect, I'm not going to say what," he said.
Rice said on Thursday Washington would try to curb Chavez's anti-American influence by reaching out to allies to expose any anti-democratic policies in what she termed an "inoculation" strategy to counter Chavez, who is allied to U.S. foe Cuba.
"I think it's fair to say that one of the biggest problems that we face in that regard are the policies of Venezuela, which as you say, are attempting to influence neighbors away from democratic processes," Rice told a congressional hearing. (end snip)

South America heating up? Seems like everyone wants to cut off OUR oil. It's looking like a good time to top off your pile of bullion, if you have the means.

DruidThe Energy Non-Crisis by Lindsey Williams #1417592/17/06; 20:57:51

Druid: So, if the world cuts off our oil supply, is this the ace up the Uncle's sleeve? Alaska is one hell of a huge land mass.
GoldiloxDr. Paul's speech#1417602/17/06; 21:25:20


Not that any of it was news, but to actually place that into the Congressional Record requires some serious political cajones!

Ron Paul for President!

PRITCHOGATA - -And an On-Going Obsession with Grandich#1417612/18/06; 00:07:36

Chris Powell (2/16/06; 20:33:12MT - msg#: 141714)
Peter Grandich says GATA knows best what's happening in gold
Another GATA dispatch.
I think I'm going have a technicolour yawn if I read any more of this type of self gratification --I mean lets put it in perspective. This guy (Grandich) has spent most of the past 6 yrs bagging & ridiculing GATA. Now he's come out & said that GATA are the good guys -and GATA quickly forgets the years of barbs & badmouthing.I'd be very wary!
Heres a copy of an email I sent to Peter Grandich on Feb 7th --when he was "trying" to pick a top in the POG:

"Peter IF you really have a handle on GOLD - -and believe it's in a longer term bullmarket - -WHY don't you simply advise those that read your report to " Hang on to your physical & buy the dips as they occur?"

The same advice could be offered to those that hold "good" Gold/Silver stocks -except that they could sell 1/3rd of their position & again buy dips as they occur. So no $hit -- you think there may be a downturn at some stage - -wow.

You don't seem serious about GOLD to me --I think you just jumped on the band wagon. On the other hand I can say I'm serious & have done very nicely thank you very much. Thanks.

mikalMarket fundamentals include emotions#1417622/18/06; 00:28:32

Many emotions are involved in financial markets. Mostly we hear of greed and fear. Greed for wealth beyond reasonable, rational limits. Fear of loss, dishonor or destitution. Like poles on a magnet, they supposedly move the markets one way or the other.
But the emotions of hatred and love caused by "isms" also play a role. Many market commentators rely on "isms" from the daily newswires to explain or predict markets to the detriment of investors, the markets and the world economy itself. We're bombarded by information "in the information age" through commercials, television, newsprint, radio and now, the net. But the existance of mass communication is not dependent on regimented overdosing of socialism, terrorism, and all other 'isms exxagerated, distorted and sensationalized, nor does their existance rely on excessive entertainment or a glut of vicarious "recreational" diversions and gadgets.
How often can they mete out titillating variants of "Venezuela said this today..." or "The arab said..." "China..."? For as long as the venerable, self-anointed capitalist theocracy remains, liberated of all blemish, free of isolationism, exempt from supramilitarism, imperialism and chauvinism and innocent of controlled, hyperpropagated journalism. Other "isms" in the gamut of polarized positions- racism, sexism, republicanism, communism, nationalism, internationalism, sectarianism, conservatism, liberalism, environmentalism, corporatism, individualism, fundamentalism, terrorism, fanaticism, statism, inflationism, deflationism, traditionalism, progressivism, reactionism...?
Aren't they merely labels? Sometimes yes, but they tell us much about emotions, the markets and sometimes, ourselves.

GoldiloxIsms#1417632/18/06; 05:16:58


Ev'rybody's talking about
Bagism, Shagism, Dragism, Madism, Ragism, Tagism
This-ism, that-ism
ism ism ism
All we are saying is give peace a chance

-John Lennon

But of course, when demonization doesn't work, they send along some nutjob programmed for assassination, and then knight your business partner.

GoldiloxDerivatives#1417642/18/06; 05:32:14


With due respect to Mr. Greenspan, the retired Chairman of the Fed, there is no way in hell that credit derivatives transfer risk from the few to the many. Rather, they transfer risk from the few to the fewer. There are only three major houses that assume these manic over the counter derivative risks as seller of the so called insurance derivatives.

These dealers are the exact ones that have now been called three times into the Fed for reports on their condition as it refers to interest sensitive derivatives (insurance derivative items with another name). I wonder if something is going on. By the way, what have you heard about Refco lately. Now there is a "sweep it under the rug" situation if any ever existed. The insurance derivatives spoken to in the following article are in the following condition:

1. There is no transparency.
2. There is no regulation.
3. There are no financial guarantees as to performance.
4. Few issuing house are up to even keeping track of what they have done.
5. There a few standards.
6. There is no continuous market for these items as transactions are negotiations.
7. In most cases both the buy and the sell side of the derivative spread must be lifted simultaneously. I will simple leave that comment to those in the know.

So the race continues between the hedge fund managers and the derivative traders to see who can destroy the world financial market first. My bet is it will be a tie!

Chris PowellGrandich and GATA#1417652/18/06; 09:32:01

Pritcho, you write: "This guy (Grandich) has spent most of the past 6 yrs bagging & ridiculing GATA."

I'm not aware of even one instance of direct criticism of GATA by Grandich prior to his endorsement of GATA's work. Could you cite an example to show me what I've missed?

In one of your recent posts here you identified yourself as a GATA supporter who has done much in Australia to spread the word of the organization's work. Yet all your citations of GATA at this forum are hostile. Hostility and criticism are fine, but please don't call it support.

Flatliner120 days.#1417662/18/06; 10:49:52

From the article:

There are a total of 1.3 billion people recognized to live in China. Recently, I have spoken to a gentleman engaged in international commerce, who is not a US citizen, who just spent 2 years in China. He informed me that the Chinese population is somewhere between 1.7 and 1.9 billion people. The government removed the one-child policy approximately eight months ago. I would expect that we'll see a new baby-boom in the maternity wards of China over the next 90 to 120 days.

- wow. That will add to the future number of physical gold buyers.

NedAhhhh! #1417692/18/06; 11:16:45

Our good friend Robert comes the phrase...
NedChris, don't be bothered.#1417702/18/06; 11:16:53

I am not trying to get into trouble here (but I probably will) but some ladies have troubles with their cycle and some don't. Guys know that and so we play careful at certain times. Not stereotyping just creeping gingerly around the bush.

I have been following your conversations with Pritcho wondering why the sharp ups and downs of her attitude every 28 days or so. I believe I have identified the cycle.

So guy to guy, when Pritcho is on the war path best to lie low.

Good luck with that.....

....and have a golden week-end.

tejbearGold: Phase II Is Here#1417722/18/06; 11:23:06

In a recent article at the website, an article was posted by Todd Stein & Steven McIntyre of The Texas Hedge Report titled GOLD:PHASE II IS HERE. Although I agreed with most of the article, the final paragraph was questionable:

Snip: "Finally, you know it will be time to sell when gold and silver dominate the airwaves of CNBC. If you ever attend a cocktail party and the topic of conversation is Latin American gold mines, it's time to get out."

Bear: If we were in a standard investment scenario, their advice would be spot-on. However, that assumes that the drop in the value of the dollar will be minimal. Unfortunately, history is full of fiats that drop to zero. If you "sell" your gold/silver, and the dollar continues to "crash". You lose.

At this time, I haven't been able to determine just "how far" the dollar will drop. Does anyone have any good guesses?

The Bear

MKYou can profit from the coming monetary crisis (to steal a phrase). . . #1417732/18/06; 11:29:37

The snow and cold that used to come in January now comes in February in the mountain west. Some say it has to do with a subtle change in the tilt of the earth's access and the consequent wobble, some say its a manifestation of global warming -- whatever the reason, it's here, it's cold, we're stuck indoors -- a good time to post about gold.

Gold's long-term uptrending channel has setup solidly over the past few years and there is no undermining it now. It really doesn't matter if you buy gold at $550, $540, $570 or $600 for that matter -- not with the stored energy potential sitting in gold like a coiled spring. The real goal for most investors (and here I must beg the indulgence of my long time readers to please excuse my repetitiveness) is to make sure your portfolio has been weather-proofed for what could be some major changes in the international economic system in the near future.

Some of you may recall my post a while back about the potential for a major conference of the prime economic powers to establish a new monetary system -- what will be billed as "the monetary system of the future." I can't help but note with interest the suggestion made this past week by Bank of Canada governor, David Dodge, who called for a conference to erect "a renewed international monetary order, and a willingness to play by accepted rules within this order."

Few who study these matters would dispute that there is something wrong in the current "order," that nothing seems to get done in terms of improvements to the system and that the current dollar-based monetary system seems to be limping toward some unknown end that makes thoughtful financial analysts cringe in fear for their portfolios (and those of their clients).

That the United States would be forced to accept a diminished role in such a new order is a presupposition. Why would there be a need for new "monetary order" if there weren't something dangerously wrong with the present one -- dollar-based as it is? In "The ABCs of Gold Investing" I mentioned the world's policy-makers attempting to move the international economy toward three currency zones -- one revolving around the dollar and the U.S. economy, another around the euro and European economy and a third around Japan and the yen. China's rapid rise has thrown a wrench in the Asian leg of the international three-legged stool, but I suspect that might not be enough to stop the march toward a new monetary order. This three currency zone arrangement has been in the works for a good many years so we shouldn't be surprised is this were the structural skeleton "the new monetary order" would take.

But what would such an "order" mean to the American investor whose portfolio (whether he or she understands it or not) is primarily denominated in dollars?

I've always been intrigued by the investor who calls me and says something along these lines:

"I'm interested in gold as a diversification, but I'm not sure I should proceed since I'm already well-diversified." Of course the lead-on question is "How are you diversified?" And the answer inevitably is: "Well, I own stocks and bonds. I have a couple C.D.'s I have a money market account. I've got my money spread out."

The fact of the matter is that individuals so structured are not diversified at all. All their holdings are in dollars. If the dollar should experience a serious demise (even if benevolently planned by the world's economic powers), then dollar-based wealth by logical extension could diminish with it. Only a diversification out of the domestic currency into a foreign currency, or gold, is going to provide the proper and full protection. Since gold has outperformed all currencies over the past year (the primary among many reasons), it seems logical that gold should be the major beneficiary as dollar holders worldwide look for the best alternative during what could become tumultuous times for the world economy.

David Dodge's call for a conference to implant a "new monetary order" may have been a trial balloon to see how various players on the world stage might react. Any monetary system change flies on a wing and a prayer. There is no perfect currency in a world where political fiat money prevails. And while splitting the load between three fiat currencies might buy time for a seriously compromised system, it eventually will be seen as only a marginal improvement over the current arrangement.

The hope of the architects is that the ordinary folk will accept the new "currency order" as stable thus buying time for further innovation. For the average investor, particularly the dollar-based investor, such a change could be wrenching as the financial system sorts things out, but don't look for direction or warning from those empowered to act politically or economically in your behalf.

The better choice is to act in your own interest with a gold diversification -- the only real way to weather the approaching sea change -- the generational saeculum and climactic crisis warned about by Strauss and Howe in "The Fourth Turning." There is no way, for example, to know how the world's various stock bourses are likely to react, or the U.S. bond market, or the forex markets themselves. All we can know is that the change is likely to be gut wrenching and that we had better prepare for it.

I can remember in my relative youth (in the early 1970s) being swayed by a series of books written by a relatively obscure, but persuasive, author named Harry Browne. His first entry was "You Can Profit from the Coming Devaluation," and it won an exclusive and highly insightful audience. His second entry -- "You Can Profit from the Coming Monetary Crisis" -- became an international best seller and was published amidst the economic turmoil and change of the 1970s -- a time not too dissimilar from our own. Here we are 30 years later talking about a new monetary conference and new monetary order the equivalent of Nixon's closing of the gold window and the reintroduction of free floating currencies -- the paradigm change Browne predicted in his first title and for which he offered solace in his second. We face similar circumstances today. Now, as then, gold will help you see it through. You can profit from the coming monetary crisis.

If you have an interest in "The ABCs of Gold Investing: How to Protect and Build Your Wealth with Gold," please go to the link above.

FlatlinerPhase II#1417742/18/06; 11:46:25

Cocktail party conversation – you know its time to buy gold when all anyone talks about is the structural problems associated with the world reserve currency. As soon as these problems are resolved, gold will be a terrible ‘investment’.
USAGOLD / Centennial Precious Metals, Inc.A combo of assets and info to help you get started on the right foot#1417752/18/06; 12:47:59">gold ownership starter kit
Chris PowellThanks, Ned ...#1417762/18/06; 13:14:48

... for your good advice. Ordinarily
I wouldn't have bothered to reply to
this one by our friend Pritcho except
that I wouldn't want any misstatements
about GATA or Peter Grandich to stand
unrebutted. Someone might pick up the
wrong idea.

24karatThanks Kilo#1417772/18/06; 16:18:15

I enjoyed the Money Masters videos from the links you posted yesterday. I learned a lot and would recommend them to any financial novice interested in the historical workings of the privately operated central banking system.

When I got done with that, I watched Ron Paul on the floor of the House. Yesterday, a lot of time was spent staring at my computer screen, but then again, there is so much to learn.

GoldiloxMoney Masters#1417782/18/06; 18:31:51

@ Kilo,

The "Money Masters" video, like Smithy's previous treatise, "The Wizards of Money", is REQUIRED reading for anyone who thinks he knows how banking interacts with politics.

ge@ Goldilox#1417792/19/06; 04:32:47

Thanks for pointing out the "The Wizards of Money" treatise. Searching the web, I found the following info at Part 7. I wonder whether it may be used to recover M3 data after its publication ceases:


"As an aside here's an interesting way to look at this data. Adding up the total Commercial Banks and Savings Institution Assets would give a total of $7.4 trillion in bank assets. This is, of course, debt of the non-bank public (that's us) owed to the banks – this is in the form of mortgage, credit card debt and so-forth. The way that money works this should mean that the total M3 money supply in US dollars (that is the money that we non-banks can use in the trade for all goods and services) should be close to this $7.4 trillion in bank assets."


He recovers assets data from

Their web site appears to be redesigned in 2003. The historical data is downloded thru following link:

Caradoc Oil workers kidnapped in Nigeria#1417802/19/06; 07:16:28

Shell's Forcados export terminal was also set on fire, and oil loading there has been suspended.
The attacks come a day after a militant commander told the BBC his group was declaring "total war" on all foreign oil interests in the Delta.
***end of snip***

This story isn't "big" enough to make it to Drudge's web site or the front page of BBC's news site -- I had to go to "world" and then look under "Africa" -- but it caught Jim Sinclair's attention. In fairness, Drudge is only one man and he does have to sleep once in a while and the story did show up in the Miami Herald only an hour ago: "...blowing up oil installations and seizing nine foreigners in violence that cut crude exports in the West African nation by 16 percent."

In any event, Sinclair points out that -- with Western interests having dismissed the Nigerian militants' warning for foreign oil workers to leave by midnight Friday as a hollow threat -- markets didn't react on Friday and the threat wasn't proven real until Saturday so world markets will be reacting on Monday while US markets are closed.

My hunch is that gold takes out $375 in world trading on Monday and on Tuesday we have some probability of US shorts doing panic buying and a complementary probability of another $20 plunge to a level only a few bucks higher than Friday's New York close.

Sure will be fun to watch!


Caradocaddendum#1417812/19/06; 07:21:31

Forgot to include link to article about the threat as published before the threat was realized. Note reference to Nigeria being the the fifth-biggest source of US oil imports.
goldquest@Caradoc#1417822/19/06; 07:25:48

I hope it was just a typo and you mean $575!
Caradocaddendum #2#1417832/19/06; 07:27:40

Make the number that gold takes out on Monday $575 rather than $375. Maybe our host could edit my original post and delete this one? Otherwise, I stand as proof that spending the night assessing three separate web bot reports is enough to leave a fellow groggy when dawn comes.

Night all,


GoldiloxTHE NO-PROFIT WORLD OF TOMORROW#1417842/19/06; 08:58:25


The rising cost of energy and the falling value of our dollar in world markets will present another problem for citizens of the good ole USA. Our energy cost will soar beyond belief. Therefore it is mandatory that you have investments in those areas where you'll have extreme increased cost. Look at Blake's rule no. 3: "The world runs on oil." And you have to own some of that oil!

The Chinese government plans to build a pipeline from Iran to China, passing through some of the "-stans," the former Russian republics. Not long ago, the Shanghai Co-operation Council (SCO, whose members are Kazakhstsan, Kyrgyzstan, Tajikistan, Usbekistan, Russia and China) has agreed and signed a pact of mutual defense - demonstration of this alliance took place August 18 to 25, 2005 (when peace mission 05 was conducted.) The SCO members also agreed to ask the US to withdraw their troops from their new military bases in Central Asia, and to set a time table to this effect.

When you combine these facts with the rising protectionist atmosphere in the US congress, where they have introduced legislation to erect 27% import tariffs against Chinese goods – and we all know that tariff wars lead to a more dire potential than a no-profit economy—it introduces the potential of armed conflict.

When you cut off a nation's supply of petroleum as we did in 1941 it provokes war.

When I started to write this epiphany, I could see the potential for massive world investment disruptions. Unfortunately, politicians begin to blame other countries for their problems at home. Once they have convinced the voting public that "It's not my fault. It's so-and-so's fault," it then leads to retribution against the cause. That is when the flames of war are fanned. What I thought was going to be a dire economic prognostication has turned into a suggestion of WW III.


Mr. Blake seems to be peeking at the Money Masters video, as he sees the potential for war in the Chinese build-up. One of my epiphanies in that vid, was the reminder that $30 billion US went straight to Hitler's build-up thanks to the Federal Reserve policies of contraction and confiscation in the 1930's.

I am anxious to hear what some of our Forum currency gurus think about the Money Masters' suggestion of debtless currency issue in place of bonds sold to the FED, et al. Especially since we're at the point where our tax revenues barely pay the interest anymore.

GoldiloxArab takeover of U.S. ports seen as security 'insanity' #1417852/19/06; 09:08:09


A company owned by the government of Dubai in the United Arab Emirates is poised to take over six U.S. ports, a development that has local and federal elected officials outraged.

A merger deal approved by the federal government has the company currently running the ports, London-based Peninsular and Oriental Steam Navigation Company, getting acquired by the Emirati firm, Dubai Ports World. UAE has known ties to terrorists and 9-11 hijackers, raising concerns about security issues at the ports involved: New York, Baltimore, New Jersey, New Orleans, Miami and Philadelphia.


US infrastructure is falling into foreign control at an alarming rate. It seems our multi-billion dollar Homeland Security is either asleep at the switch or powerless against anything except nail clippers and cigarette lighters.

Goldilox Tensions Remain Over German Gold#1417862/19/06; 09:12:05


FRANKFURT, Feb 16, 2006 (Dow Jones Commodities News via Comtex) --Tensions remain between the Deutsche Bundesbank and the finance ministry over what to do with Germany's gold reserves, despite statements from both Thursday, a person close to the negotiations told Dow Jones Newswires.


Not much detail, but a not-so-subtle reminder of the elephant in Germany's living room.

David LinkleySharp knives#1417872/19/06; 11:16:02

Paul Craig Roberts, John Dean, Stanley Hilton, Ron Paul are but a few Republicans coming out against the Bush White House and it's secretive policies at a time when the world is becoming more dangerous by the day. Oil, debt and the dollar are now in a precarious balance and have some of the world's oil producing countries lining up against the US. (Iran, Venezuela and Nigeria) There is no benign outcome to our current situation. Will an event give this unconstitutional government the excuse for marshall law? Expect the knives to get sharper as the stakes rise.

This weekend Barron's had an interview with Walter Deemer and his view is that oil has topped out because that's what it did in the early 80s when many said that we had entered a period of scarcity and he said gold is too volatile to invest in. Apparently he is not concerned that 2.5 billion people are entering the world economy using more oil or that some of the biggest and oldest oil wells are in decline. So what does Mr. Deemer like? You guessed it, big drug companies. With advice like this from the Wall St. media, sites like this board are becoming more valuable by the day.

TownCrierA company of shareholders left holding the bag...#1417882/19/06; 17:09:34

HEADLINE: SA gold-output slump raises concern

Feb 20, 2006 -- The marriage between gold-mining in South Africa and delirious profit taking is long past the honeymoon phase.

Since the golden years of the 1960s and 1970s, the marriage between the two has been in steady decline. ( an "82-year production low".)

As South African mines go deeper, gold-miners are having to fish deeper in their pockets to pay for the recovery of gold.

Gold-mining output in South Africa has been falling at an average of 4% a year over the last 25 years, according to a recent gold review.

It is a "mature industry, which has passed its prime", says Trade and Industry Deputy Minister Dr Rob Davies.

^---(from full article at URL)----^

As someone interested in investments and holdings that have ENDURING value I'd much rather give over my investment dollars in exchange for gold metal than for shares in a depleting mining operation with a limited lifespan.

And on that note, I took particular interest in several of the somewhat leading remarks offered in the article. These I have reproduced below. Choose metal!


"...Should we not be satisfied that the commodity has already played its part in transforming South Africa from an 'agricultural backwater' into a developed economy? The industry, for example, has been a crucible for the creation of an advanced financial sector and has also given birth to three of the six largest gold-mining companies in the world - Anglo Gold Ashanti, Gold Fields and Harmony. But is nostalgia for the 'glory days' of the gold industry the only valuable currency which the sector still has to offer?"

"Through most of its history, gold-mining in South Africa was essentially an activity in which gold ore was taken from the bowels of the earth in South Africa and sent to the bowels of the earth in vaults in the US and other countries," says Davies.

"Although gold is no longer as important as it once was in its contribution to the GDP or to export earnings, it is absolutely vital that we maximise the benefits to our country, and to our people of the asset which we still have," says Davies.

The slump in South Africa's gold supply comes at a time when the outlook for the commodity is taking on an increasingly positive lustre.

A recent update to the Gold Fields Mineral Services (GFMS) 2005 gold survey points to a promising outlook for gold in 2006, with "buoyant" investments cued to drive the gold price to fresh highs.

TownCrierOil and Gold#1417892/19/06; 17:30:04

Compare the recent gold comments by Davies in my article with the oil comments from the BBC article that Caradoc posted earlier today.

'Wealth control'

On Wednesday the Nigerian military used a helicopter to hit barges it said were being used by militants to smuggle stolen oil.

The rebels recently blew up two oil pipelines, held four foreign oil workers hostage and sabotaged two major oilfields.

The group wants greater control of the oil wealth produced on their land.

Nigeria is Africa's leading oil exporter and the fifth-biggest source of US oil imports, but despite its oil wealth, many Nigerians live in abject poverty.

Davies on GOLD:
"Through most of its history, gold-mining in South Africa was essentially an activity in which gold ore was taken from the bowels of the earth in South Africa and sent to the bowels of the earth in vaults in the US and other countries. ...... it is absolutely vital that we maximise the benefits to our country, and to our people of the asset which we still have," says Davies.

It boils down to the apt subheading that BBC offered... 'WEALTH control'.

You either HAVE it, or you don't.


Clink!Iran's future#1417902/19/06; 18:43:44

I was reading an article at 321energy and came across this little gem :-

Iran is not quite at its production peak, but within 20 years, even the most optimistic estimates forecast that Iran will cease to be a net oil exporter. (This may also have something to do with Iran's desire to develop a nuclear program.)

End snip.

So maybe they see that they need to develop other sources of energy before the oil runs out ? Wow, what a concept - thinking ahead.
The rest of the article is worth a read about the "sorry state of the nation" too.


TownCrierA V Rajwade: The riddle of the dollar's value#1417912/19/06; 19:54:02

New Delhi(February 20, 2006) -- should not be forgotten that the dollar's exchange and interest rates are highly vulnerable to Asian monetary policies -- and while the current relationship can go on, it can also end suddenly. Political developments should also not be ignored -- for instance, sanctions against Iran and its switching oil pricing to another currency.

As for me, despite the experience of 2005, I remain bearish on both the external value of the dollar and the bond prices.

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


mikalHollow promises, empty pockets yearn for gold#1417922/19/06; 20:28:54

The Case for Fewer but Stronger Currencies - New York Times
- Daniel Gross
More validation of MK's currency predictions.

The Invisible HandFollow the leaders#1417932/19/06; 21:10:27

By joining forces in a move expected to deal a major blow to the U.S. economy, Iran and Venezuela are encouraging and creating a golden opportunity for other states to shift foreign-exchange holdings out of dollars and into euros or other currencies.

GoldiloxBlows against nationalist economics#1417942/19/06; 21:59:30

As outlined in the Money Masters video, the CBs financed the Russian Revolution and brought Lenin to power as the Czar was the only European monarchy to eschew a private central bank, supporting Lincoln's minting of US Treasury notes. Do not underestimate what lengths the banksters will go to to defeat any currency moves not "fully authorized" in their BIS/IMF NWO plan.

As Iran is the last remaining proponent of the Islamic Gold Dinar, their independent financial moves are much more threatening to them than North Korea's ready-to-deploy nuclear weaponry.

War does not frighten the banksters. They lick their chops at the opportunity to profit by supporting both sides and adding the debts of the loser to the winner's post-war obligations.

ToolieBig Mac index 2006#1417952/20/06; 05:55:56

Sinp: The cheapest burger in our chart is in China, where it costs $1.30, compared with an average American price of $3.15. This implies that the yuan is 59% undervalued. (end snip)
mikalFor the aftermath, what remains will turn on things golden#1417962/20/06; 08:19:43

Bernanke is no inflation fighter
The new Fed boss is most scared about deflation, not inflation. And when the markets figure that out, precious metals prices will scream. By Bill Fleckenstein - Monday, February 20, 2006 -- Snippits: ..."The fear of a "tough" Fed has precipitated the recent shakeout in commodities, where it's now become fashionable to call that market a "bubble." (Of course, most of the folks reaching for that label -- and "reach" is what it is, by my reckoning -- are the same ones who couldn't see the stock bubble or housing bubble as such.)
Debunking commodity-bubble talk
Let me explain why I don't happen to think the commodity market is a bubble. Over the last few years, we've seen any number of shakeouts in this asset class. Every time one occurs, the same stories make the rounds about deflation or the end of the "reflation trade." What these shakeouts have really been about is too many people on the same side of a trade. Then the thing tips over, feeding on itself en route down. At the margin, that's what I believe happened in the first half of February in all forms of commodities...
...When the "right" data emerge to support the fact that the economy is weaker than it appears, I believe the Fed will make clear that it's closer to pausing than people think. (Bernanke himself told Congress last Wednesday that whatever the Fed does will be "dependent on the data.") If that turns out to be the case, I think there will an explosion in the precious metals and currencies, an outcome that I intend to capture."
Interesting "contarian corner" essay. Such contrarian ideas are no stranger to regular visiters here. Assuming Bernanke is not tipping his hand except to those willing to read between the lines is a safe bet.
Never before has the Fed been so vulnerable to a economic
and financial discontinuities, illiquidity or relatively minor disogenous events. In mere seconds, they can trump the ability of the Fed to "stabilize" one or more markets.
With the Fed already between a rock and a hard place, articles such as the above show that it's room to maneuver is fast approaching nil.

TownCrier1 kg gold bars debut#1417972/20/06; 10:34:24

Vietnam, February 20, 2006 -- A Ho Chi Minh City-based jewelry company will for the first time introduce 1kg gold bars Wednesday in a bid to facilitate local transactions and deposits...

"The launch is in tune with the global trend and promises a thriving local market."

The company is to launch its first 50 bars Wednesday, with several banks already registering to buy.

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

Sure seems like a lot of fuss for merely 50 bars... sorta leaves you with an impression that maybe, just maybe, a little bit of gold is held in much higher esteem in these other places of the world.

On a business-related note... with the U.S. gold market closed today in observance of the President's Day holiday, the brokerage office of USAGOLD-Centennial Precious Metals is also therefore on holiday today. Bottom line: call tomorrow!


TownCrierUS Treasury Freezes Assets Of Group With Alleged Hamas Ties#1417982/20/06; 12:29:47

WASHINGTON -(Dow Jones)- The U.S. Treasury Sunday blocked accounts of KindHearts, an NGO operating out of Toledo, Ohio, to ensure the preservation of its assets pending further investigation.

The action freezes any assets KindHearts may have under U.S. jurisdiction and prohibits U.S. persons from engaging in transactions with the NGO, or non-governmental organization.

Stuart Levey, Treasury Undersecretary for Terrorism and Financial Intelligence, said in a statement Sunday, "By utilizing this specialized designation tool, we're able to prevent asset flight in support of terrorist activities while we further investigate..."

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

Issues of terrorism and law-enforcement aside, this illustrates the fundamental weakness -- the "Achilles' heel" -- of "paper" assets. In the paper realm everything is merely represenational -- whether it be a fancy certificate in your own hands or a printed statement of account by your mutal fund broker of the various virtual certificates being held on your behalf.

Think about what it really means when an account is frozen as in this example. Do any physical assets in the real world come grinding to a halt or lose value due to the account becoming frozen? Say, for example, it was a 'diversified' account including a little bit of everything -- shares in GM, Japanese government bonds, etc. As a consequence, General Motors certainly doesn't put any corresponding part of its production line on holiday. And similarly the Japanese government doesn't get an automatic pass on its corresponding debt; it'll keep printing currency and rolling over the IOUs the same as ever.

If nothing out in the real world reacts (pauses or becomes frozen) in correlation with the freezing of the represenational paper, one must pause and give thought to the question: How exactly does all this paper EQUATE with the actual wealth of the world?

To be sure, the "freezing" of accounts as exemplified in this article doesn't do anything to material change the nature of the real wealth existing in the world. It is important to understand this distinction. What it DOES do, or more precisely what it theoretically aims to do is to BLOCK the AVENUE by which otherwise harmless and impotent forms of "paper" can be brought forth and exchanged at the market for anything more immediately meaningful, tangible, and generally far less impotent than a mere "account".

"Freezing" on any level generally isn't about an acutal seizing of real assets, but is rather all about keeping someones hands tied up with a relatively benign paper account so that they don't (or can't) reach out for REAL resources. Once you understand that, you will have come near to the important crossroads of thought in which you can easily categorize and prioritize your financial decisions regarding the meaningful accumulation of tangible wealth (such as enduring gold) over the mindless pursuit of papery representations.


TownCrierGold jumps to 10-day high on firm oil, drop in dollar#1417992/20/06; 12:34:56

LONDON (Reuters) - Gold prices moved to 10-day highs on Monday supported by a rise in crude oil and a drop in the dollar, and dealers said the metal was expected to extend gains.

Asian and European players bought back metals as oil prices leapt after Nigerian rebels bombed pipelines and a major tanker terminal over the weekend, knocking out 19 percent of supplies from the world's eighth biggest crude exporter.

Gold rose as high as $556.60 an ounce before easing to $554.50 at the afternoon fixing.

Traders said physical demand was slow, while there was also little investment interest, as the New York futures market is closed on Monday due to the Presidents Day holiday.

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

CamelFeather trade#1418002/20/06; 14:03:07

I think a plausible case could be made that the US would have been better off to stop at Afghanistan, and concentrate on finding Bin Laden in Pakistan. I guess the rational is that an incursion into Pakistan would rile them up so much, the government might be overthrown . Afghanistan could have been made into the showcase . Now we are in a quagmire while the true perp is still running around lose.

Course it is probably true that the evil brothers Dewy and Louie are better off dead , from our point of view.I doubt if they would have been averse to slipping a couple of mil under the table for some dirty nukes. If they thought they could get away with it.

Maybe Clinton could have done something to stop Bin Laden if he hadn't been so distracted

Ran across an interesting figure for the price of gold . At one time in this country an ounce of egret feathers was worth an ounce of gold. It takes about four birds to make an ounce of feathers, which were then used for the ladies hats from 1880 -1910. They were killed by the millions all along the Texas coast in what came to be known as the feather trade, giving rise to the Audubon Society.

GoldiloxThe true wars Post #141736#1418012/20/06; 14:24:11

@ Camel,

If you haven't aleady watched the Money Masters video posted by Kilo on Friday, it will underscore why all of this small war nonsense is diversionary.

North Korea already has nuclear arms, so they say, but Iran's enrichment program is a "greater threat" to the admin and the media. Considering that every country surrounding Iran is already armed with nukes, it's not surprising that they want 'em, too.

It's a mess, but the nuclear issues are really not at the heart of it.

Money Masters Part 1:

Money Masters Part 2:

As described in Revelations, once TPTB have complete monetary control, "no one can buy or sell, unless the have the 'mark' of the beast".

RFID implants, anyone?

GoldiloxFreezing Assets#1418022/20/06; 14:33:45


While I would not quibble with your description, what it seems to be to me is a judgement against assets in lieu of court action.

i.e., when the Iranian revolution toppled the puppet Shah, western banks were all over the Iranian national assets to "claim" them for his highness, and keep the new Iranian government "frozen out" of them.

Rimhre: freezing assets, TC#1418032/20/06; 16:04:25

And this is latest example is not an isolated case - the most notable recent example that comes to my mind is Argentina freezing all personal banking accounts, allowing only limited withdrawals on a daily basis, and automatic conversion of all US dollar account in Argentine Pesos at some forced conversion rate, all done with a few quick keystrokes on the computer. While it caused massive upheaval and turmoil in the country, there was no stopping the central bankers from enforcing these monetary controls on the populace with little or no warning. I assume that now that order has been restored, there are more who keep a more significant amount of money "under the mattress" so to speak. And in a surprising turn of events, the central bank actually began buying gold in an effort to provide some kind of perceived "backing" to their currency....

If there ever was a attempted run on the banks here, you can bet all personal accounts would be "locked down" in a flash, just like Argentina. I don't necessarily expect a run on the banks, I just wouldn't want to get caught if there were...

All this to reiterate TC's comments about the perceived value of paper it's weaknesses vs real money with real value albeit understated value at current USD prices.

slingshotOdds and Ends#1418042/20/06; 20:57:26

I have to admit that the variables leaning to a higher price of gold can be as complex as the odds at any given table at Las Vegas. Depending at which TA you use it can be comparable to the dice table or Black Jack. The reason why I state this is that the Powers That Be are not going to give up this monoply willingly and we Goldbugs will have to asborb bits of information and then decide if we will place our bet on the table This can be an experience for the first time placing a bet from a novice gambler.
Some of you might be saying,"What the heck has this to do with gold". Well if you have been to Vegas you will find it an extraordinary city. But things have changed. Not only the buildings that tower the strip but the price of placing a bet has increased. The Black Jack Tables, which I play, have increased in the price of the Min. Bet. From $5.00 to $10.00 and there are not many tables compared to other higher min. bet seats. Same for the slots as the nickle is slowly replaced by quarter machines. The most comparable prices, believe it or not, is the price of merchandise at the Flea Markets. Everything that was once a quarter is now a dollar. Talk about the purchasing power of the dollar. Hmmmm, no inflation.
At the Flea markets there has been a surge in the venders selling silver coins and bullion. Silver Eagles are at $13.50 and $14.50 for 2006. The Prospector by Englehard is commanding a price of $15.50.This one ounce silver bullion coin is priced well above spot and is selling.
The housing market in North Florida has exploded. Being a woodsman, I have noticed more and more trees pulpwooded and construction along once lonely roads are now made into sub divisions with their own golfcourse.
My hunt club is even up for bid and I fear that we may have 1 more year left to hunt.
So in simple terms, a goldbug has to be on his toes. He may see things that are happening around him, and read a different story upon the web.
Just food for thought.

slingshotSearch for the Renaisance#1418052/20/06; 22:40:53

The chamber remained silent except for the scuffle of those Knights and Ladies of the Court, entering the room.
Sir Pritcho, breaks the air and speaks.
" Never before have I seen any town so decimated. This enclave of trade and prosperity has been turn into a desolate wasteland with only its defensive walls intact. The town has been gutted and its edifices torn assunder to make an arena with grandstands that would hold thousands for which spectacle to behold I have no idea. The town square is obliterated and only earth fills the wide span from wall to wall. Those who gave the town life are gone with no trace. The field to the north has been greatly unlevened and the stones that held the Beast within the ground have been cast aside. The countryside is without life. No bird or insect gives any call as if a Dark Veil has desended where all may envision. There are no signs of battle as if they were swept into oblivion with no sign of their existance. For whatever reason, I fear they are all lost".
Murmers of disbelief went through the room.
Sir M. K. tapping upon the Oaken Table brought order and he then spoke.
"My fellow Knights and Ladies of The Great Oaken Table of Yore, Do not despair! Although we did place the Beast Therroth into the earth and Gandalf placed the stones to keep him bound, there was no assurance that the evil forces would one day raise him again to harm". We will prevail" With that the Wizard came to his side holding his staff. Tapping his staff three times upon the chamber floor , eyes of all turned upon him.
" Listen to what I proclaim", he said in a thunderous voice. If this beast, Therroth has been risen by the Dark Forces, we can defeat him!" " He is only a manifestation and his power comes from what we give him. Do not delude ourselves for his power is great, (Fiat vs GOLD) and many believe in him and his overseer."
Gandalf over time had undergone many changes. Gandalf,to Gandalf the Grey and then to White. But now he had a Golden glow and as Wizards are very secretative there were many a story as to his transformation. His return with his fellow Knights from their search for the Prophesy of Oro was clouded in mystery.
Then Sir M.K. turned to Sir Black Blade.
"Summon all Knights and footmen far and wide to assemble here at this castle. Summon Stephen the Great and tell to make arms to field a Great Army. To bring Smaug and Draco and their siblings for I fear there will be many terrible engagements"
"As you wish", said Sir Black Blade.
"Let there be a call to arms as never before" said Sir M.K.
So the proclamation went forth and a Great Army began to assemble at the Castle.


slingshotHey are you out there!#1418062/20/06; 23:02:48

Just wondering if a few lurkers or Newbies are traversing the forum ;0)

Golden LionheartWhen is a bubble not a bubble?#1418072/20/06; 23:09:44

Surely a bubble is in the eye of the beholder.....Could not the doubling of the price of gold in the last few years be called a bubble? Think about that one.
Smeagolssss....sshhhh....#1418082/20/06; 23:23:44

slingshot (2/20/06; 23:02:48MT - msg#: 141806)

"Just wondering if a few lurkers or Newbies are traversing the forum ;0)"

(we're ssneaking... does that count?) ~>8-)


slingshotGolden Lionheart#1418092/20/06; 23:24:06

Hello, Golden Lionheart. Nice to see you are up at this time. 0117 military time for myself EST.
Bubble? Look where M3 money supply is taking us. That is US Dollar. I firmly believe gold is underpriced. I just don't see when they say gold is oversold as compared to the 50 and 200 day moving average. So what in the heck do the investors want. More dollars printed or the moving average to determine if gold is oversold?

slingshotSir Smeagol#1418102/20/06; 23:27:25

Sneaking is fine as long as you do not get too sentimental.

slingshotSir Smeagol#1418112/21/06; 00:00:21

My good sentimental friend. I am sure you will understand me. Myself, I think I am of the younger crowd and music has a (somewhat) effect on how I feel. But with the permission of our Great Host,may I explain. We all know the gold market has been really up and down. The Forum rules state we must have a gold menu. That is O.K. But behind the scenes, I play rock and roll music. Mostly Tom Petty. The music cuts the tramatic movements especially to the lower side. Maybe what I am saying is that we are human and not just Goldbugs. I like Black Blades Negro Modelo. So if you have a adult beverage or two, do not be afraid to sing or jump around when tuning into the forum.
I find it very THEROPUTIC.

Golden LionheartSlingshot#1418122/21/06; 00:03:06

Up! I live near the Western Australian goldfields and at the moment its afternoon and 42C (something like 107F in the old measuremets you use in the Estados Unidos).

Great mining and exploration activity going on around here.
In the last few months the local paper has recognised that gold exists. Good for us goldbugs!

OvSDavid with the slingshot.#1418132/21/06; 00:03:26

I'm barely alive but still
I'm trying to rouse myself
to go on a journey, exchan-
ging a pile of gold and sil-
ver for a much larger pile
of (lime)stone...
Who says one has to be rat-
ional...Just look at the
sorry lot of our overlord-
mess...and now I hear, with
this puny slingshot you have
joined the 5 dollar betting
crowd to slay Goliath? May the
Goddess of the Moon protect
us with her milken sheen.OvS

slingshotHello to Down Under#1418142/21/06; 00:20:07

I live in North Florida and the last time we had days of over 100 degree f most of us would like to die. It is a pleasure to talk to someone that far away and my contact with Aussie's and British have been most remarkable. If there were any a goldbug, the difinition would have a British or Aussie for a picture. Spent three days aboard the HMS Ark Royal. U.S sailors are spoiled. Tell me, are opals plentiful as I hear?

slingshotOVS#1418152/21/06; 00:28:44

I have done well at times. The trick is to find a seat at a table that is having fun. It is contagious especially a double down and Black Jack.
Where do you Hail from?

slingshotI would just like to say#1418162/21/06; 00:48:54

That USAGOLD Forum is the best site I have ever visited. This forum has gone INTERNATIONAL and has maintained high standards of information pertaining to Gold and its investment capabilities. Its forum's posters span the globe which gives great insight to the integral mechanisms of the gold market.

Much is lost to those who fear to post.
and much is lost from those whom have left the Forum.


slingshotOh No!#1418172/21/06; 01:04:18

According to the time increments we are in a Dead Zone.

Golden LionheartSlingshot#1418182/21/06; 02:17:51

Little opal in Western Australia, it mainly occurs at Coober Pedy in South Australia and at Lightening Ridge in New South Wales. Always a plentiful supply of run of the mill stuff but the really high quality opal more difficult to find.

I worked in mineral and oil exploration for thirty years worldwide including a lot of work trying to find gold. Its a lot easier to purchase it from USAGOLD - Centennial Precious Metals!

Expecting the price of gold to power through $575 next month. No worries!

SundeckShhhhhh...indeed....Agree with Sir Smeagol#1418192/21/06; 03:49:39

...we wus jus' sleepin' in the forest...that is until Sir slingshot comes a-rampagin thru'...clinkin' his Negro Modelos and lining up the empties for target practise (oh how I wish he'd brung only five smooth stones!)....not t' menshun raisin Cain wid dat dang ghetto blaster...

Oh's I's awake...s'pose I'd better try'n say somthin sencible...

Opals? Ehhh yes...done a little huntin for the "red-on-the-black" at Lighting Ridge many years ago. Have a brother who has done it professionally for much of his life. It's what we in Oz refer to as a "raggy a-s-d living". Lots there, but like gold, usually lots of dirt mixed with it. But you can get lucky and get into a patch. If you know what you're doing, you can survive reasonably well...but often there is a long time between pay cheques. Top quality red-on-the-black verrry expensive...many thousands dollars per carat (about size of a pea). Black opal comes from Lightning Ridge, NSW. Milky opal from Coober Pedy and Andamooka, SA. Boulder opal in Southern Qld.

Wanna try it? Catch the opal-bug? Recommend you stay with least you know how and where to find it...and I think it is still going fairly cheap...


Rook.,.#1418202/21/06; 05:54:44

I bet China regrets playing its cards like it did.
Asking for panama canal as thier trade off for joining the dollar world was a mistake. Japan got to buy US food and meat and fish industries for its decision to be the 51st state, and dubai gets ports. Some got the US gold I suppose, and the saudis own god knows what.

Clink!$630 POG soon ?#1418212/21/06; 06:05:36

There's a very nice looking chart from Lars Lindgren at Sinclair's site. Looks like we've just had a nice bounce off the bottom of the channel.


GoldiloxThe End of the Western World we have known since 1945#1418222/21/06; 08:53:03


The Laboratoire européen d’Anticipation Politique Europe 2020, LEAP/E2020, now estimates to over 80% the probability that the week of March 20-26, 2006 will be the beginning of the most significant political crisis the world has known since the Fall of the Iron Curtain in 1989, together with an economic and financial crisis of a scope comparable with that of 1929. This last week of March 2006 will be the turning-point of a number of critical developments, resulting in an acceleration of all the factors leading to a major crisis, disregard any American or Israeli military intervention against Iran. In case such an intervention is conducted, the probability of a major crisis to start rises up to 100%, according to LEAP/E2020.

An Alarm based on 2 verifiable events
The announcement of this crisis results from the analysis of decisions taken by the two key-actors of the main on-going international crisis, i.e. the United States and Iran:

- on the one hand there is the Iranian decision of opening the first oil bourse priced in Euros on March 20th, 2006 in Teheran, available to all oil producers of the region ;

- on the other hand, there is the decision of the American Federal Reserve to stop publishing M3 figures (the most reliable indicator on the amount of dollars circulating in the world) from March 23, 2006 onward[1].

These two decisions constitute altogether the indicators, the causes and the consequences of the historical transition in progress between the order created after World War II and the new international equilibrium in gestation since the collapse of the USSR. Their magnitude as much as their simultaneity will catalyse all the tensions, weaknesses and imbalances accumulated since more than a decade throughout the international system.

It seems bearishness is going global, a well.

GoldiloxLars' Chart#1418232/21/06; 08:58:21

@ Clink,

Most interesting is the Stochastic indicator that gold is heavily oversold from the last round of "gold analysts" chasing their flock out again.

Goldilox"Trade cards"#1418242/21/06; 09:09:31

@ Rook,

China also got their lease of Hong Kong back with no opposition, along with much of Japan's light manufacturing. They didn't do so badly judging by near double-digit growth rates.

Saudi Arabia, it seems, got Crawford, TX, and complete admin whitewash of their financial support of anti-western Islamists.

And if we are still operating under FOA's hypotheses, a lot of western gold.

GoldiloxThe Silver Fund Battle continues#1418252/21/06; 09:27:38

Last November, AIR reported on attempts by Barclay?s Global Investors to introduce an exchange-traded silver fund (or a silver ETF) in an attempt to capitalise on the success of equivalent gold ETFs.

In response, the US Silver Users Association (SUA) was up in arms from what it predicted would be a resultant substantial silver price-hike.

This expectation is based on the effect gold ETFs have had on the gold price. Put simply, if the silver EFT has anything like the success of the gold ETFs then suddenly Barclay?s will need to buy more silver than actually exists.

Not surprisingly, SUA anticipates this will mean the collapse of the silver jewellery industry as it will be priced out of existence, and this means manufacturing bankruptcies and loss of jobs. Representatives of other areas of silver usage have also registered their fears. SUA goes as far as to say it would have a negative effect on the US economy.

The Securities and Exchange Commission has tacitly approved the listing of the Barclays ETF on the American Exchange, pending the outcome of a 21-day period of public comment. SUA is using this time to state its case emphatically.

The editor of the independent Silver Stock Report suggests SUA has actually got the whole story exactly backwards. Rather than causing job losses at Tiffany?s, a rise in the silver price would likely open new mines and reopen new mines deemed unfeasible at the current price. In other words, the laws of demand and supply will prevail.

As part of its defence, SUA has made a point of saying it supports the buying and selling of silver for investment purposes, and highlights existing means of so doing.

The Silver Stock Report finds this amusing, as SUA is actually making its own bullish case for the metal.

History would suggest SUA is on a hiding to nothing. Opponents of any form of financial derivative or paper-trade equivalent are scattered like dust on the roadsides of the greatest capitalist nation on earth. Notwithstanding, if SUA is right, and the SEC is nevertheless happy to proceed, why hasn'?t the silver price already shot up?

In fact it has risen since our article in November, but only in its traditional tracking of the gold price. Like gold, it has corrected this month, despite the SEC?s tacit approval for a silver ETF. One can fairly predict that the ETF will go ahead.

Next in line are platinum and palladium. More fun.


The spin-meisters are hard at work on this one.

Caradoc@Goldilox#1418262/21/06; 10:28:02

Your link is the best publicly available distillation I've seen yet of the various elements that seem to be converging by the end of March. Thank you!

One of the elements that could have been worded more strongly is that -- in order to avoid subjecting the planet to another Chernobyl-class disaster -- anything done to take out Iran's uranium enrichment program must be done before the end of March.

Just for fun, try finding any disconnects between the material you linked and the the three most recent projections from the web bots at, all looking at a major "context shift" by the end of March.

For those not following the bots... Without revealing any proprietary or copyrighted material, it's safe to link/quote some web bot predictions which the urbansurvival site addressed yesterday in their typical breezy manner:
Checking the Fuses

While I'm sitting here waiting to see what the big context changing event around March 28th will be, I keep looking through the headlines every morning to see what fuses are burning so to speak. We have several:


Russia is trying to jawbone Iran into dropping their plans for uranium enrichment. But as Russian media are reporting, the deals offered would all keep Iran from accessing a full fuel cycle, and that's so far been key to Iranian demands. Tssssttttt......

In Israel, funding to the Palestinian Authority has been cut off. Even though Hamas won the election, the headlines now speak of Israel punishing Hamas, and cutting off the wallet seems like the first move. Tssssttttt...

Nigerian rebels have claimed a key victory in their fight against corporate oil exploitation, which sent prices higher in markets that were open today. Tssssttttt...

Bomb blasts in Iraq have killed 19 more people as the country descends into civil war. Ah, but it's a democratic civil war and the US plan now is to press separation of Islamic factions by trying to keep religion out of the politics. Tssssttttt.

The US ambassador claims that Iran is resupplying insurgents in Iraq. We expect this kind of talk to increase as we move toward the rumored March bombing dates. Tssssttttt.

In Pakistan, hundreds have been arrested as rioting continues from the Danish publication of a cartoon of the Prophet Mohammed. Tssssttttt.

While these events would be worrisome alone, the "fuse story of the day" may very well be the audio interview of Osama bin Laden released today. In the interview, bin Laden says he doesn't want to be captured alive and also throws a few barbs in the direction of Saddam Hussein.

Here is my specific concern: I'd be willing to bet a beer or three that this latest Osama tape is the beginning of a fuse that will lead to a major terrorist attack within the next 45 days. His message today is odd.

While there's nothing in the current web bot run about an immediate terrorist attack threat, I'd have to point out that there may not be a word in our lexicon for some new form of mega terror.

Immigration Angle

What is in the reports are references to the notion of rebellion. This brings up a frightening thought: What if bin Laden's message was to start the countdown to a massive coordinated attack on dozens of locations to be executed by hundreds of sleeper cells across the US? Maybe I have seen one too many episodes of "Sleeper Cell" or been reading too many immigration reform reports and know too much about the number of OTM's coming in from Mexico. But while the CONgress talks a good immigration game, their legislation is often unfunded. And that ticks off local police chiefs. They've got local crime to deal with and immigration is down the list a ways.


We don't have a word/concept for such an eventuality but the word rebellion is troublesome. Remember, the web bot's pre-9/11 linguistics went to the idea of "military, accident" and other terms because we didn't have the specific words terror/terrorism/terrorist [attack] in the lexicon. So I'm left to ponder: Is Osama's latest today effectively lighting of a fuse? He has already warned us, and so to his way of thinking, attacking America is now acceptable. I hoping I'm wrong, but is it possible that this is his lighting of a big, long fuse?

An astute observer might mistake America's current condition. Although, most of our military is outside the US at the moment, and as one reader reported:

"To show you how desperate the military is for troops to serve in Iraq, a young friend of mine, who is a Seaman on a Boomer (Trident nuclear ballistic missile submarine), was notified that he, and some of the other Seamen serving on the Boomers, may be given sentry training and then deployed to Iraq to serve as a sentry for a period of one year."

Thankfully, America is also the most heavily armed country on earth. And America's foes might under estimate our local/neighborhood ability to organize and defend our country.

Other than maybe buy another box of shells, not much to do to prepare, other than read the info at www./ However, with a "context change" in the cards, I'd sure be out of the markets by mid March.
***end of snip***

Again, Goldilox, thank you!


GoldiloxChernobyl-class disaster#1418272/21/06; 10:45:38

@ Caradoc,

"One of the elements that could have been worded more strongly is that -- in order to avoid subjecting the planet to another Chernobyl-class disaster -- anything done to take out Iran's uranium enrichment program must be done before the end of March."

Not sure what evidence supports this statement. But perhaps that's why no one wants to address the North Korean nuclear arms manufacture - that and whatever other under-the-table agreements exist, since Rummy himself was on the board of teh company that outfitted North Korea.

I think this is a smoke screen, given that Israel, Pakistan, India, and now Iraq already belong to the nuclear weapons club. When we cry about open inspections, it would be a lot more viable argument if Israel openly admitted their 200-300 nukes. Their one whistle-blower is still under house arrest, even though they have no admitted nuclear program.

Goose and Gander?

USAGOLD / Centennial Precious Metals, Inc.A risk-free request, helping you enter the gold market with grace and confidence.#1418282/21/06; 10:48:31">Get a head start on the gold market!
GoldiloxBig Picture#1418292/21/06; 11:00:31

@ Caradoc,

In other words, totally agree with Cliff's assessment that George may be paying too much attention to the trees in lieu of the forest.

There seems to be nothing the banksters love better than watching their serfs scramble to destroy their assets and rebuild them with lucrative bank loans for both the armaments and the construction.

Back to my response to Rook, maybe the other thing the Chinese got in their dollar trade deal was assurance that the West would support the North Korean nuclear arms buildup, no matter what the rhetoric.

GoldiloxShell extends force majeure on Nigeria oil fields#1418302/21/06; 11:09:14


LAGOS (MarketWatch) -- Royal Dutch Shell (RDSB.LN) said Tuesday it has extended a force majeure that legally protects it from not meeting its contractual obligations on Nigerian crude oil exports from the EA field and Forcados oil fields.

A company spokesman said the original force majeure, declared in January after militant attacks, had been previously expected to end by late February, the spokesman said. The extension has no time limit, he added.

"No time has been fixed for the end of the force majeure," the spokesman said.


Disruption in Nigerian oil production continues to affect the international oil trade.

Federal_ReservesThe Road to Bankruptcy is paved with promises#1418312/21/06; 11:13:24

Treasury's Use of G Fund to Avoid Hitting Debt Limit Won't Hurt Investors, Officials Say

By Stephen Barr
Monday, February 20, 2006; Page B02

Although the Treasury Department will rely on the G Fund in the Thrift Savings Plan to buy some time to
maneuver against the national debt limit, federal employees who invest in the fund will not suffer any
losses, officials said.

Treasury Secretary John W. Snow told Congress last week that it had begun to use the TSP's government
securities fund to keep from hitting the $8 trillion debt limit. He called on congressional leaders to
increase the debt limit by mid-March, suggesting that was when the Treasury might not be able to meet its
financial obligations.

Snow also indicated that TSP investors should not worry about his decision to suspend reinvestment of
some TSP assets on a daily basis. In a letter to Capitol Hill leaders, Snow said G Fund participants "are
fully protected and will suffer no adverse consequences from this action."

A 1987 law requires the Treasury secretary to make "complete restoration of all funds temporarily affected
by this necessary action, including full and automatic restoration of any interest that would have been
credited to the fund," Snow wrote.

The G Fund is one of the most popular investment choices for federal employees, in part because it
provides steady returns (4.48 percent for the 12-month period ending Jan. 31). The fund, available only
to government personnel, allows investors to earn rates of interest similar to those of long-term
government securities without any risk of losing principal and with little volatility in earnings.

The G Fund has about $65.3 billion in assets, but a Treasury spokeswoman said officials "will just take
what we need to get through each day." Treasury began suspending G Fund investments Thursday, according
to Snow's letter.

By suspending G Fund investments, Treasury makes room on the government's books for more borrowing.
Brookly McLaughlin , the department spokeswoman, said Treasury might resort to other methods to avoid
bumping up against the debt limit. For example, she noted that the government closed a window Wednesday
for lending debt securities to state and local governments.

Numerous federal employees object to the Treasury maneuver, contending that it amounts to a raid by
the government into personal savings accounts. But officials noted that the G Fund has been used to
avoid defaulting on the national debt several times, including during the budget showdowns of 1995 and 1996.

In a posting on the TSP Web site, the Federal Retirement Thrift Investment Board said a "make-whole
provision" in the 1987 law "means that TSP participants who have invested in the G Fund will not lose anything."

GoldiloxG-Fund#1418322/21/06; 12:30:58

@ Federal Reserves.

The SSI excess is used to make up some of the budget shortfalls, while the G-Fund will be used to shore up the markets. PPT funding must be getting a bit thin.

The FED's ammo stockpile is rapidly being reduced to debt monetiization.


What's that sound?

Why it's just Benny the Blade's currency taskforce.

GoldiloxMore on G-Fund tapping#1418332/21/06; 13:32:25


How much control do you have over your investment in the G-fund in your Thrift Savings Plan? Perhaps not as much as you might think.

The Federal Government has a problem that will have a short-term impact on some investors in the Thrift Savings Plan.

The government needs money--or perhaps it needs to cut down on expenses. Of course, most people think the government could cut back on any number of expenses and the nation would be better off. The federal debt is projected to reach $423 billion in 2006. But, for now, Uncle Sam is hard pressed for cash and needs to come up with it quickly. The problem is the federal government is up to the debt ceiling authorized by Congress.

This is a short-term problem because Congress will eventually pass a new limit. But, while it will undoubtedly do so in the future, Congress has not yet acted. For the government to spend money, it has to borrow more and it can't do this without Congressional authorization. No doubt, politics and political strategy is lurking in the background.

And that is where you come in. It may surprise some readers to find that investors in the G-fund will be donating some of the money.

The G-fund is a big pot of money. Right now it has about $65 billion just sitting there. By using some of this money-- the super-safe investment vehicle of choice for a large number of federal employees through the Thrift Savings Plan (TSP)--the debt ceiling problem goes away. Anyone, including the federal government, can do a lot with $65.266 billion. By withdrawing investments from the G-Fund, the Treasury is able to avoid hitting the debt ceiling.

Treasury Secretary John Snow is urging Congress to raise the debt ceiling by the middle of March. Right now it is limited to borrowing 8.18 trillion.

"Once I am able to make the G-Fund whole, the effect on the G-Fund and its beneficiaries will be the same as if this temporary action had never taken place" Treasury Secretary Snow said in a letter to Senate Majority Leader Bill Frist (R-TN).

This same event has occurred before and for the same reasons--the federal government's authority to borrow money was expiring. Most employees will never know the difference since, as Secretary Snow indicated, the people giving up the money for a short time will be made whole including any interest that may be due.

Still, if it was my money in the G fund, I would want to know what was happening to it. And, for a short time, it is being used to prop up the daily spending for your employer. It's a patriotic gesture--but you really don't have any choice.


Fire up the presses, boyz. Government emplyees are not as apt to take to hijacking as readily as SSI recipients.

Is this an accident waiting to happen, or what?

TownCrierFederal Reserve in open market today, buys Treasuries outright#1418342/21/06; 13:35:08

Despite the market in fed funds trading nicely in line with the latest FOMC policy directive (4.5%), the trading desk for the Federal Reserve nonetheless felt compelled to wade into the open market, buying year-out treasury coupons in an intervention totalling $1.248 billion, thus adding that quantity of freshly-made money to the nation's 'permanent' money supply.

In other operations, the Fed also injected $7.75 billion through overnight repo operations at a soft 4.473 percent.


The Invisible HandNothing can stop an idea whose time has come#1418352/21/06; 14:39:35

Ultimately, this story has its roots far beyond the triggers here identified; the changing priorities of the People's Bank of China, the coming of the Iranian oil bourse, and the ascension of confidence levels in the euro towards a critical mass. The fundamental forces that will drive the coming rebalancing of the global currency markets have been building for decades, but only now may the circumstances be right for their stark manifestation.

The Invisible HandSome don't believe in ideas#1418362/21/06; 14:49:54

In order to believe that the US government is planning an attack on Iran to head off the challenge to the dollar that a euro-based Iranian oil bourse would represent, you must first believe that the Bush administration actually worries about such things, and there is little proof that it does. It certainly should, but if it truly did, would it have pushed through the biggest tax cuts in American history? The Bush administration is reckless enough to contemplate an attack on Iran, but it is too ignorant about fiscal and monetary matters to worry about such esoteric matters as the potential connections between a shift to euros in the oil market, foreign investor confidence in the US dollar, and the sustainability of the massive US budget and trade deficits. As Vice President Dick Cheney said to former Treasury Secretary Paul O'Neill when the latter protested over the huge Bush tax cuts (an issue on which he later resigned): "Ronald Reagan proved that budget deficits don't matter."
If the US does attack Iran, it will be for other motives.
By Gwynne Dyer
© Arab News 2006

USAGOLD Daily Market ReportPage Update!#1418372/21/06; 14:54:53">
The Daily Gold Market Report has been updated.

If you are considering investments in gold we invite you to">request our free introductory information packet detailing the products and services offered by USAGOLD ~ Centennial Precious Metals. We welcome your inquiry and look forward to working with you.

TUESDAY Market Excerpts

Gold up on safe-haven, oil concerns

February 21 (from Reuters) -- U.S. gold futures rose and settled at an 11-day high Tuesday, as overnight strength in spot gold and firm oil prices sparked speculative buying to extend gains from Monday, when U.S. markets were on holiday.

Investors played catch-up with bullion in a recovery from last week's five-week lows as crude rose a dollar after militant attacks shut in a fifth of Nigeria's oil supply.

Dealers said gold's bounce above short-term technical resistance over the weekend attracted investment funds back to the precious metals.

"The market keeps bouncing back and, once we climbed back above $550, more investors came back in," said George Gero, vice president at RBC Capital Markets Global Futures.

"Once again, after all the selling by the funds last week, it seems they thought that buying the dip was the best thing," he said.

The COMEX April gold contract closed up $2 at $556.60. Futures opened higher after spot gold rose Monday on physical buying and then held steady on Tuesday.

Oil rose back above $61 a barrel Tuesday after militants in Nigeria shut in a large part of the country's output by attacking a key tanker terminal and blowing up a pipeline over the weekend. Rising oil usually boosts gold as investors are attracted into commodities in general and as a number of traders turn to gold as a hedge against inflation.

Dennis Gartman, author of The Gartman Letter, said gold was looking firmer on the Nigeria unrest as well as expectations that Asian central banks likely will be topping up the gold in their reserves in 2006 and 2007.

"Seeing that their reserve holdings of gold are inordinately low when compared to the gold holdings by the legacy central banks of Europe, the People's Bank of China, the Reserve Bank of India, the Central Bank of Russia, the Bank Negara (of Malaysia) et al are quietly on the bid for gold," he said.

Analysts said ongoing tensions over Iran's nuclear ambitions buoyed gold as well. Iran showed few signs on Tuesday that it was ready to strike a deal with Russia that could allay fears it wants nuclear arms and avert possible U.N. sanctions.

Dealers said that if gold holds firmly above the $550 area this week, it could retest levels nearer to $570.

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

TownCrierHong Kong aims to build gold warehouse for China#1418382/21/06; 15:14:41

HONG KONG (Reuters) - Hong Kong may be about to build a bonded warehouse at its airport to store gold and make the Chinese territory a regional trading hub while feeding rising demand from mainland China, industry officials said on Tuesday.

The Chinese Gold and Silver Exchange Society, Hong Kong's sole spot gold market, has lobbied the government to set up the bonded warehouse for three years, a senior official with the industry body told Reuters.

"The time is probably mature," the official said, referring to speculation in the market that the government might make an announcement in the coming days.

The society has also lobbied Beijing to approve the new bonded warehouse in Hong Kong as a delivery site for trade on the Shanghai Gold Exchange -- the sole spot gold market in mainland China which, with India, is seen by the industry as the gold consumer with the most potential globally.

Approval of the warehouse plan might lift trade on the Shanghai exchange and China's imports as Chinese players theoretically can import the metal freely.

But that might not happen before Beijing allows its currency to be freely convertible because gold is seen as a form of currency and controlled rigidly by Beijing.

"China for the time being may not use the warehouse in Hong Kong because of the currency issue. It cannot control the yuan if it allows imports and exports freely," said an official at precious metals trading and refining firm Johnson Matthey.

Gold forms part of China's foreign exchange reserves...

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

Said it before and will say it again... the full transition toward a free gold market takes time as it must be done logically and progressively, and here at USAGOLD, starting with 'The Gold Trail', you're watching it all unfold one step at a time.


GoldiloxIdeas#1418392/21/06; 15:42:36

@ TIH,

I wonder if Ms Dyer believed all the "reasons du'jour" for the Iraqi invasion, as well?

Sometimes the apologists appear to believe their own spin, even when in the process of making it up!

It's not that the media is all stupid or short-sighted, more sadly, that they beilieve their readers to be so.

Fortunately, as TC reminded us, we at the Forum have had the benefit of a long term, daily unfolding education through the process of discovery.

guns'n'butterthe "G" fund mania#1418402/21/06; 16:44:01

As long as any $US are of ANY (fiat) "worth" the G fund is totally safe. In fact this is part of the retirement plan for US Congressman and Senators. I am readily invested in this plan to the tune of 25% of my total investments. The remaining 75% of my total "worth" is in PHYSICAL GOLD.
I sleep really well at night.

David LinkleyWestern leadership crises#1418412/21/06; 17:20:33

As smoke rises ever thicker from the world economic system word is seeping out that all may not be well. Many intelligent clients of mine not aware of the current fiat death trap we're in but are communicating an uneasiness I've not heard before. It's not just dollars losing value its a sense that something's very wrong. People very much dislike Bush Presidencies as Bush 1 was unelected and Bush II has a 35% approval rating. Incongruent thinking and policies are the hallmark of Bush Administrations.

How can you pass the draconian Patriot Acts and install Fatherland (I mean Homeland Security) and leave the southern border open, give approval to let foreign countries control some of your ports and hire such incompetence in FEMA and other security agencies.

I'm convinced the real problem of the West today is not oil or money or debt, these are symptoms of a leadership crises. We will always have too many challenges for the resources available its how these resources are allocated. It is imperative as we enter this great financial and moral crises that we find leaders worthy of leading. These leaders must anchor their principles to sound money, a rule of law, free markets and the truth. Without these principles a suffering public will not respond as needed.

GoldiloxFIAT "value"#1418422/21/06; 18:36:46

@ guns'n'butter,

"As long as any $US are of ANY (fiat) "worth" the G fund is totally safe."

I guess that depends on one's definition of "safe". . . by yours above a 99% loss is still "safe"!

The other 75% of your assets seems far safer by my standards.

Druidguns'n'butter (2/21/06; 16:44:01MT - msg#: 141840)#1418432/21/06; 18:37:30

"As long as any $US are of ANY (fiat) "worth" the G fund is totally safe. In fact this is part of the retirement plan for US Congressman and Senators. I am readily invested in this plan to the tune of 25% of my total investments."

Druid: I'm not so sure that the G fund is any different in terms of safety then any other type of fund along the risk curve of counterparty obligations. Check out the link and focus in on the total amount of debt that takes the form of "non-marketable" debt. Thumbs up on your 75% allocation.

The Debt Demons &
The Bond Creatures They Feed On

mikalWhat kind of chips on your table?#1418442/21/06; 19:47:32

BIS Calls For Global Currency - Paul Joseph Watson - Feb 21
Among various allegations that strange, Orwellian money
is imminent are quotes John Maynard Keynes, a recent UN report and a recent London Telegraph article.
In gold you're layered in protection, even if the chips are down.

mikalSalute the flag?#1418452/21/06; 20:09:02

I pledge allegiance, to the flag, of the United Nations of NY
And to the Corporation, for which it stands
One plantation, under Surveillance
With world tax and 'soma' for all.

GoldiloxBush threatens veto in ports row#1418462/21/06; 20:37:52


US President George W Bush says he will veto any law blocking a deal giving an Arab company control of six US ports. The threat came as Bill Frist, leader of the Republican Party in the Senate, said he would move a blocking law if the government did not delay the deal.

The issue has developed into a very serious political standoff between Mr Bush and senior Republicans, the BBC's Justin Webb reports.

The administration is to brief a Senate committee on the deal on Wednesday.

Administration officials will address an unusual session of the Senate Armed Services Committee on the planned takeover, which would put six of the largest ports in the hands of Dubai Ports World of the United Arab Emirates.

The ports are New York, New Jersey, Philadelphia, Baltimore, New Orleans and Miami.

Critics say this would make the US more vulnerable to terrorism.

The ports are currently run by British ports and shipping firm P&O, which has agreed a $6.8bn (£3.9bn) takeover by DP World.


After five years of this "conservative" President never lifting the veto pen to a single spending bill, it awakens for the delivey of US infrastructure to foreign interests. Hmmmmm . . . No matter what his motives, the timing of his announcement can't help but fuel more controversy.

Ok, even if the "terrorism" issue is covered, what does sending the revenues overseas do to our already ailing balance of payments and local budget dilemas? It might mean a quick one-time infusion of cash, but then strap the next generation with the inability to profit from their own infrastructure.

just my $0.03, inflation adjusted.

mikalShort and to the tipping point#1418472/21/06; 20:52:55 Goldman sees gold at $575 - John Partridge - February 21
"Increased investment demand last year and the expectation that it will continue" have persuaded the European arm of Goldman Sachs to increase their POG forecasts for this year and next. Foregoing cheesy, undignified rationales, these revered denizons of the financial summits
tersely iterate their glamorous pronouncements.

SundeckHas Bush played the oil-card?#1418482/21/06; 21:41:29

By the way, The Invisible Hand, nice little story, #141835


Meanwhile, back at the ranch...

"America is addicted to oil." declares Dubya. ...and I notice he has also been doing the rounds amongst the alternative energy sector proclaiming "breakthroughs" are near at hand.

Why this uncharacteristic display of sane leadership, directing America towards the land of the obviously-essential at a time like now? And why now this tacit rebuttal of his much earlier grandiose proclamation: "The American lifestyle is not negotiable".

Has Dubya had an epiphany on the road to Baghdad? Is it becoming apparent that, even if a miracle were to occur and America was to corner the oil market by gaining unrestricted and unhindered access to Iraqi oil resources, the hydra is growing heads faster than Dubya can have them removed: Iran, Venezuela, Nigeria, Russia, China...not to mention fiscal and trade deficits, dollar levitation and America's low ratings in the global opinion polls...

Is Dubya "flying a kite"...perhaps seeking Franklinian wisdom about the strength and direction of the winds that blow aloft in America...and of the intensity of the lightning that resides in the storm-clouds gathering on America's shores?

Is he doing this so that he may captain the US Ship-of-state safely into calm seas with a sustainable-energy future…and become known as "Durable Dubya – The Light of the World"?

I would like to think so...

…or is he doing this in furtherance for the Middle-Eastern campaign?

There is a cynical side to my character (it's the scientist in me that cannot be banished no matter how hard I get into Mammon-worship) that says:

"Ah-ha! Dubya has played the oil-card at last!"

Dubya might appear to be a goof, but make no mistake…he is a shrewd politician…backed up by a shrewd bunch of strategists.

Oil is important to America. And oil invoiced in US dollars is important to America. But "oil" was not made to be the primary reason for the Iraqi campaign…WsMD were the ostensible reason…leading onto the high moral ground of "democracy" (by hook or by crook) and the noble struggle against "terror" (even if it was largely of one's own creation). However, with things not quite panning out as golden as hoped in the short-term…and, in fact, with lots more panning and little gold in sight…what is a dogged Dubya to do?

There is little doubt that the players (The Administration) in this new Great Game have been spending many a long night shuffling and reshuffling the cards …eyeing the Black Queen and arguing the sequence in which she is to be played. Once on the table there is no taking her back. The players are in for all or for nothing and no-one knows who holds the upper hand or which way the game will slew…

Perhaps Dubya's kite-flying is intended to determine which way the game is likely to go:

1. America, the reforming oil-addict, signals its willingness to fall back onto its great history of innovation and can-do zeal and accept the challenge posed by the oil/energy/dollar crisis at its door…opting to wean itself progressively from foreign oil and the foreign-relations headaches that accompany that dependence.

2. America, the entrenched oil-addict, opts to continue its habit; rushing to short-term fulfilment in the face of whatever logic, threat or long-term reward is proffered.

If the game slews towards #1, there will be a great deal of goodwill directed towards America and it is likely that an internationally-engineered, face-saving exit-strategy for the Iraqi campaign will be forthcoming. There may even be a reprieve for the dollar…or, at least, a sensitively architected descent. This would indeed be a "neo-renaissance", and even Sundeck would dance on the deck singing Dubya's praise…

If the game slews towards #2, then the eventual outcome is much more foreboding…and Sundeck will probably want to hide under the bed with some gold bars rather than dance on the deck in Dubya's radiance…

But either way, #1 or #2, it is difficult to see gold suffering in the foreseeable future. There is too much energy stored in the coiled dollar spring for it to just disappear un-noticed. It's just that #1 would lead to "a good gold-price in a good world", in contrast to #2.

Sooooo…has Dubya played the oil-card?

And if he has, what will be the response of the players? How will America react? Will there gradually develop amongst the complex stake-holder groupings an acceptance of the "energy inevitabilities"…leading to the will to pursue alternative energy futures? Or will the stake-holder groupings in America swing down hard for more-of-the-same?

Just one man's thinking on a quiet Wednesday afternoon in Oz…


mikal@Goldilox - Any port in a storm?#1418492/21/06; 22:02:56

Good points.
Not good to outsource more management jobs, but we've been selling out properties and businesses to Arab royals and businessmen, Japanese, Brit's, Europeans etc. for decades now so a veto is a new twist where the impetus for global developments seems to eminate from another planet, Wall Street, London or Brussels.
Who lives here anyway? We do, so we should have first dibs on ports and all else in our backyard.
A Bush veto will indeed "fuel more controversy", as you say-
the mere talk of it entertains America's detractors and turns our stomachs for a variety of reasons.
Also, a characteristic of a failing system is to have
an increasingly chaotic transition before a final climax, or anticlimax.
Whatever the inevitable finale, it's possible the ports
issue attracts more attention towards some pressing issues.

monTROZSale of Ports (Long)#1418502/22/06; 00:07:27

Selling U.S. port operations.

The prospect of a United Arab Emirates company running container operations at U.S. ports is obviously dangerous for United States security. Why would it be considered?
Since we are given little reason but "fairness" by the President, speculation as to the real reason is warranted. Here are some possible reasons that might push a President who has not vetoed a single bill in 6 years of office to be so strongly in favor of what is blatantly dangerous that he threatens a veto if this is blocked.

1.What recently happened in the UAE that might influence the situation? Duh, a gold exchange opened there not too long ago. So why throw a bone to the country that started this new exchange? Lots of reasons to do with gold, physical delivery, price suppression, dollar support, military protection, etc. Maybe a deal was made, "You do this with gold, we do this with a business deal. You don't do that to the dollar, we don't do that with our military." The Prez. can't really tell the people about this deal that would expose the ugly reality, and embarrass our "friends".

2. Some time ago a huge spending bill passed to tighten up our port security. Tighten it up just enough to allow apparent weakness to be used as a means to allow highly controlled infiltration. Just enough to let the enemy in to an environment where they can be watched, followed, and stopped. The arrogance of Iran "We thank God our enemies are idiots" Mahmoud Ahmadinejad. (6 February 2006) and others, may lead them to walk straight in the front door if it's left unlocked. This plan may stretch back before the security bill was passed and attempts to derail it would interfere with a long well developed trap. It was not supposed to pass unnoticed; it is to make us look really stupid if it goes through after all the fuss.

3. We used air bases in the UAE for the war in Iraq. What did we give to convince the Emir's to allow infidels on their land?
"Hmm, what do you want?"
"Lucrative contracts with American port facilities, and less competition from the British shipping company."
"O.K. I think we can get Tony to agree to that.
"Good, but it must look like ordinary business; we value our good appearance with our fellow Arab states."
It may be a done deal that if broken would limit any further cooperation, due to justifiable distrust.

So there are three reasons that could explain apparent absurdity. (just wild guesses)

The more troubling part is that since the cartoon jihad and the Islamic boycott the UAE is now promoting a boycott of our long standing NATO allies, Denmark and Norway. So after they take over the port management could they stop Danish shipping in American ports? Or just slow it down. Your cheese has gone bad, so sad.
I looked through NATO documents online and couldn't find any firm commitment to mutual defense for economic attacks, but there are strong words for protecting fundamental freedoms. Freedom of speech must not be a fundamental freedom because nobody seems to be defending Danish rights. Everybody seems to be piling on condemning them.

"4. EAPC States are committed to the protection and promotion of fundamental freedoms and human rights, as well as the rule of law, in combating terrorism."

But, if you want to publish inflammatory images, I guess you're on your own.

Off to the fridge for a Tuborg.

GoldiloxUAE options and NATO's commitment to "free speech"#1418512/22/06; 02:40:03

@ monTROZ,

Interesting "options", especially number 3. One correction - Dubya has been in office 5 years, so there are sadly 3 more to go.

I think the David Irving trial outcome suggests how important "free speech" is in Austria. Three years in jail for "denying" the holocaust.

Ernst Zundel's trial for "holocaust denial" in Mannheim, although almost entirely withheld from the press, appears to be a near carbon copy.

When it is a jailable offense to question historical accuracy, we truly have come full circle to the mentality of "the Inquisition".

PRITCHO@Sundeck - - Re "Has Bush played the oil-card?" (Message 141848)#1418522/22/06; 03:31:58

Personally I think it's option 2 that's still in play.The Gold bars will be needed but I'm sure there are a lot of dirty tricks still to come. See Privateer Snip below --especially "Iraq Occupation Update".As he points out there is no intention of withdrawal for decades --despite the pretense that they will leave as "soon as possible". We live in interesting times.
From the Privateer - -19th Feb 2006

The projected US deficit for 2006 is $US 423 Billion. That's $US 100 Billion more than 2005. President Bush has proposed a record $US 439.3 Billion defence budget, up 4.8 percent from last year. Over fiscal 2005, which ended on Sept. 30, 2005, the Defence department spent about $US 6.8 Billion a month on operations in Iraq and Afghanistan and the replacement of equipment damaged or destroyed there. The White House estimates indicate that the US will spend more than $US 125 Billion during the fiscal year ending in September 2006. An additional $US 50 Billion is already is being planned as a down payment for war costs in 2007. A $US 2.77 TRILLION budget is almost $US 10,000 for every American.

Iraq Occupation Update:

The hard central fact is that the number of attacks on US forces in December numbered nearly 2,500 and was almost 250 percent of the number in March 2004. This shows clearly that the Iraqi resistance is an increasingly effective militarily force. The White House said last week that it would ask for a further $US 120 Billion in new emergency funds for Iraq and Afghanistan. That comes on top of $US 320 Billion allocated for the two wars thus far. The US is completing the four large air bases that it is building around Baghdad. They are of such a huge size that it makes them into "mini-USAs", signifying that the US intends to stay in Iraq for at least several decades ahead. Inside the Green Zone in Baghdad,the US is building the biggest Embassy complex in the world costing more than $US 600 Billion.
NB - This does NOT count the 14 Permanent Army Bases that have been built around the country.(Pritcho)
US Dollar Warning Signs:

BEIJING - Feb. 7: The Chinese government should ideally have cut its foreign exchange reserves by half at the end of last year to help ward off risk and ease upward pressure on the Yuan, an official from the Bank of China was quoted as saying on February 6. China's foreign exchange reserves swelled 34 percent in 2005 to a record $US 818.9 Billion. China's reserves, which will soon surpass those of Japan as the world's highest, are now enough to repay its entire foreign debt and still buy 10 months' worth of imports.When the present international and financial situation of China and the US are compared, the incongruity screams to the sky. China stands with real global net financial savings. The US stands with a net global debt of $US 3 TRILLION which is climbing further with each monthly US trade deficit. China is paying its way internationally. The US lives at the mercy of its lenders, foremost amongst whom is China.

More US Dollar Warning Signs:

EUROPE - Feb. 6: Syria has switched all of the state's foreign currency transactions to Euros from US Dollars, according to the head of the state-owned Commercial Bank of Syria. "This is a precaution. We are talking about Billions of US Dollars." - stated Mr Duraid Durgham to Reuters. The Syrian bank, which still dominates the Syrian market, although private banks have been allowed to set up in the last few years, has stopped dealing with US Dollars in the international foreign exchange flows of its private
Syrian clients. On March 20, Iran, Syria's strategic ally, will open its Euro OIL bourse, cutting in under the US Dollar's current near world monopoly on trading in international oil. This, along with China's threat to sell half its reserves, is a deadly threat to the US Dollar's global reserve currency standing.

The Bottom Line:

TheAmerican general public barely knows about any of this. They all live in a US media centric world,with the US as the centre of the universe and the sole superpower to boot.
The fact that so many of them have been reduced to an economic form of peonage strikes most Americans asbeing "normal". They are close to their individual debt limits, as is US Treasury. The rest of the world knows about all this and increasingly fears the arrival of the day when Americans finally realise that their nation is broke.

Toolie@ Sundeck#1418532/22/06; 03:36:35

Here's my take on Bush's focus on alternative energy.

It's just like they way that they have been dealing with Yuan Revaluation. Congress says; we're going to vote a 27% tariff of Chinese goods unless the Chinese revalue the Yuan. Bush says; hold off were working hard on it, it's a delicate matter, sensitive. He's trying to stay in front of the momentum, and thereby control its direction and progress. With the hope of continuing the current game as long as possible. This past week (?), a bill was introduced in congress to remove MFN (Most Favored Nation) trade status from China. The Administration's reaction was to announce that they were going to get tough with China – so there is no need congress to act, everything is under control.

Regarding alternative energy; the recent actions are intended to take attention away from "oil war", "peak oil" concepts and replace it with a hopeful one. The President implies; that any minute now there's gonna be a puff of smoke come rollin’ out of a lab and a fellow is going to come running out yelling eureka, a test tube in one hand, switch grass in the other. The President intends to plant doubt in the minds of those who view US foreign policy an "oil centric" – why would we try to control the Middle-East when we have switch grass? Perhaps an indication something else will soon be cookin’ in the M-E.

Just follow the money.
Q: Where is the government spending, alternative energy of military?
A: Alternative what?

Toolie----Today in 1879----#1418542/22/06; 05:06:55

Frank Winfield Woolworth opened a five-cent store in Utica, New York.

Wow, look how things have improved. Now we can afford dollar stores. Back in 1879 they probably had to settle for domestic goods too, couldn't afford the imports.

PRITCHOPlanting The Seeds Of Distrust - - - " Al Qaeda's Road Paved With Gold"#1418552/22/06; 06:50:19

You can bet on it.Stories like this will become endemic as the PTB desperately try to blacken the purchase of Gold.

DUBAI, United Arab Emirates -- Just as the United States and its allies swept toward Afghanistan's main cities last autumn, the ruling Taliban and Osama bin Laden's al Qaeda network sent waves of couriers with bars of gold and bundles ofdollars across the porous border into Pakistan.

"In small shops and businesses along the border, the money and gold, taken from Afghanistan's banks and national coffers, were collected and moved by trusted Taliban and al Qaeda operatives to the port city of Karachi, Pakistan, according to sources familiar with the events."

Then, using couriers and the virtually untraceable hawala money transfer system, they transferred millions of dollars to this desert sheikdom, where the assets were converted to gold bullion. The riches of the Taliban and al Qaeda were subsequently scattered around the world -- including some that went to the United States -- through a financial structure that has been little affected by the international efforts to seize suspected terrorist assets.

As if dollars wouldn't be even more portable & be more versatile to so called terrorists.Above story not to be taken seriously--- except by the 90% of Americans who own no Gold!

PRITCHOLatest Ted Butler - - How ETF's Threaten More Manipulation #1418562/22/06; 07:07:24

Teds latest is spot on the money.The Gold ETF's for example could be used at some time in the future to co-ordinate a sharp sell off & substantially lower the price.

Hit With The Stupid Stick Again
By: Theodore Butler


"I genuinely believed that the rocket scientists on Wall Street had hit the peak of stupidity when they concocted precious metals leasing/forward selling. I have come to realize that I was wrong. They've actually come up with something dumber.

have tried to remain somewhat neutral on the pending Silver ETF proposed by Barclays and awaiting approval by the SEC. I look forward to seeing the matter resolved, approval or rejection. Either outcome will confirm much of what I have written about silver. While a couple of my articles were listed on the SEC web site, I did not submit them nor request they be submitted. I wanted to stay out of the fray. Now that the comment period is over and the SEC is no longer soliciting comments, I'd like to get something off my chest.

This proposed silver ETF, as well as any ETF on any commodity, is as dumb as a bag of rocks. Sure, it will make the price explode, and precisely for that aspect virtually all silver investors, including me, look upon it favorably. Suddenly take away a big chunk of any commodity's supply and there will be a big impact on price. That's elementary. But there is more to the story than that."

A good read - -see link above

GoldiloxAl Qaeda "gold"#1418572/22/06; 07:57:13

@ Pritcho,

"The CIA used BCCI to funnel [smuggle] millions of dollars to the fighters battling the Soviet occupation of Afghanistan. Bin Laden had accounts in the bank, U.S. officials said. The bank also specialized in dealing in commodities such as diamonds and gold."

Notice how carefully they try to separate bin Laden from the CIA efforts, even though he and "Pakistani Security" were the ones directly receiving the CIA "deposits".

This article is truly political garbage, and you're right that it was meant to denigrate gold bugs as terrorists. The information source, like "two Pakistani sources", are totally untraceable.

Notice that they mention cash in the same sentences, yet never denigrate it, but its time will come when the RFID options are ready for forced implant.

GoldiloxCOMIX to the rescue!#1418582/22/06; 08:04:48

After all that work taking down PMs in London overnight, the COMIX boyz ran it right back up over $550 at the open. They must have some nasty shorts that need to be addressed NOW!
ToolieGoldilox - RFID#1418592/22/06; 08:11:49

Imagine the temptation.

Let's say the public accepts the cashless society and the accompanying RFID chip. What powerlusting social engineer could resist adding a ‘remote termination’ feature to the chip?

Hey, if you're not doing anything wrong, what are you afraid of?

Perhaps we'll come to our senses before then and decide to own our money, instead of our money owning us.

Goldilox"Ownership Society"#1418602/22/06; 08:24:05

@ Toolie,

Unfortunately, it's not the "money" itself that owns us, but the holders of vast quantities who believe it is their "God-given" right to own us. Royalty and serfdom are alive and well.

"One-man, one-vote," is rapidly disintegrating into "one-dollar on deposit, one vote," which is just another form of corporatization.

How many shares do you own? Oh, you're just an employee? Well, we'll pass "our" decisions down to you through your management.

CNBC noted Tuesday that one of the big corporate raiders is taking on Heinz in this election year. That should keep some of the Demo party financiers kinda busy.

contrarianFive cent stores versus 99 cent stores#1418612/22/06; 08:53:26

good comment and proof in the pudding of how the dollar has lost 95 percent of its value since the early 1900s. We no longer go into five cent stores, we go into 99 cent stores! Perfect example of the los (loss) of purchasing p o w e

GoldiloxFive cent stores vs. $0.99 stores#1418622/22/06; 09:06:32

@ Contrarian,

I think it's worse than that. The original Five Cent stores were first run merchandise, where our $0.99 stores are overstock and unknown brands - essentially retail write-offs.

Ninty-five percent inflation is probably giving the FED "inflafla fighters" the benefit of doubt.

Model T truck = $200
F150 truck = $20k to $30K

Price inflation is more like 99%.

contrarian99 cent stores#1418632/22/06; 09:32:27

Nonetheless, the 99 cent stores are still a bargain! I can buy a telephone adapter there for 99 cents that goes for three times as much at a nationally branded electronics chain that claims to have the "best buy".

Or, even more extreme, I priced a hack saw at my local hardware store at $15, and instead bought one at my 99 cent store for 99 cents!

GoldiloxBargain money#1418642/22/06; 09:55:41

Exactly my point. Today's $0.99 cent store is actually more of a bargain than the original Five Cent stores were, suggesting that inflation has eroded prices and values even more than 95%.

I like to compare it to the "D" word - derivatives. Options have two components to their value, intrinsic and risk (or faith, if you will).

The removal of backing to create pure FIAT has eliminated all "intrinsic" value, such that FIAT currencies only retain their "risk" value - aka "full faith and credit."

The end result is currencies are more political and manipulatable than if they were actually backed by something more tangible than the threats of invasion or creditor foreclosure.

By the way, congrats on the hack saw!

contrarian99 cents#1418652/22/06; 10:22:03

Goldilox I totally agree! And brace yourself for March!
mikalCredit derivative mountain depends on impossible (exponential)growth#1418662/22/06; 13:05:17

Guest Commentary, by Ed McCarthy
Armaggeddon Or Just One More Central Bank Inspired ‘Justifiable Methodology To Ensure Market Stability?’ - February 22, 2006
Excerpt: "...Maybe it is only me. Basically here you have a credit product, originally contracted between a couple of 14 Family guys, but now done between any two schmucks who can pronounce the words "credit default swaps." We KNOW that at one point 97,000 of these transactions were essentially invalid as they were unmatched and verified by both parties. We KNOW that these, at least started in the 14 Families, although unbridled assignment could have them anywhere.
No wonder there are 57,000 contracts of this ordure floating around out there and Mr. Geithner and anybody with a mind should be terrified. There are millions of potential counter-parties, potentially all playing the same game.
YET WE GET ONE, COUNT IT ONE, OBSCURE ARTICLE ON PAGE TWO ON A THURSDAY. If I were Governor Bies, I would give the president down there in DC another opportunity to appoint a Fed Governor. My nomination: Howdy Doody!
Admittedly we are probably overstating the severity here but not necessarily.
If one LTCM could run up liabilities with the selfsame, more or less, 14 Families a decade ago, of more than $1 Trillion, are we ready to argue that 1,200 firms and by orders of magnitude more bonus-greedy individuals serving them don't have a greater potential disaster out there? If one Barings player could take out the firm, who is to say that there are not lots more of them? Lastly, with compensation driven by the "nuts" from the deal, and the deals not even being recorded (we are told they will be down to half, or 45,000, of unreconciled deals by May), please refresh my sense of incredulity by telling me that these hotshot MBA's and PhD's NEVER did a deal to help the month or the yearend bonus check. I remain a skeptic of the first order and make the statement:
THERE COULD EASILY BE A MULTI-HUNDRED TRILLION CESSPOOL OF UNRECONCILED CREDIT OUT THERE IN "CREDIT DEFAULT SWAP LAND." Admittedly there is potential massive overlap reducing a total aggregate beyond ultimately terrifying!
This one may be too big for the LAST GREAT "SMOOTHING" AND GET OUT OF CONTROL!
In here is a systemic crash of humongous magnitude, not only for some significant piece of the "Hedge Fund" Game, but for the 14 Families. What the hell, it's only a few more billion of shareholder money and won't really affect the 2006 bonuses pool if we can smooth and smother.

Like other derivative markets, credit default swaps were never intended to be anything but a means to instant gratification. The kind of damage created in the orgy defies measurement and detection, but the lessons learned from them will apply to nearly every aspect of society.

LacklusterFord trucks @ Goldilox#1418672/22/06; 13:37:11

Goldilox, you forgot to hedonically adjust for the improvement made in those trucks!
mikalDerivative growth guarantees obsolete data#1418682/22/06; 13:39:18

A Financial Shock: "When, Rarely, But Inevitably" - Mike Landfair - February 22, 2006
A short view of systemic risk, derivatives, creditworthiness of major counterparties or institutions and the potential for financial shock using limited data.

TownCrierNew gold images#1418692/22/06; 14:36:26

A feast for the eyes.

Be sure and call USAGOLD-Centennial for superior consultation and best prices on all of these items and more!

TOLL FREE 1-800-869-5115


GoldiloxHedonistic improvements#1418702/22/06; 15:01:15

@ Lackluster,

Do you mean all the plastic and electric gizmos that break right after the warrantee expires? Or the electronic 'puters that force us to know our dealer by first name every time an idiot light blinks.

Pulleeeeeze . . .

Hand crank it, baby!

mikalSlipping confidence in currencies#1418712/22/06; 15:38:09

Emerging Market Currencies Slide on Contagion Fear
02/22/06 - Steve Johnson - Snippit: "Emerging market and high-yielding currencies fell sharply in European morning trade on Wednesday as Tuesday's sharp slide in the Icelandic krona unnerved investors. The krona suffered its biggest one-day fall against the US dollar for most five years on Tuesday, tumbling 4.6 per cent, as Fitch lowered the outlook on Iceland's country rating from "stable" to "negative", citing an "unsustainable" current account deficit and soaring net external indebtedness.
The krona continued to slide on Wednesday, falling a further 3.4 per cent to a 15-month low of IKr68.26 to the dollar. And the sell-off appeared to spook carry trade investors who have piled into a range of generally high-yielding emerging market currencies in the hunt for superior returns."
Sometimes yields cannot rise fast enough to compensate for slipping confidence. At the same time, most CB's can't lower rates enough to stimulate economies. As more are
insisting, return on investment isn't adequate to match heightened risk on emerging market currencies, whatever the carry spread, and turn to gold, devloped nations currencies will need more monetization and eventual resuscitation.

USAGOLD Daily Market ReportPage Update!#1418722/22/06; 15:52:20">
The Daily Gold Market Report has been updated.

If you are considering investments in gold we invite you to">request our free introductory information packet detailing the products and services offered by USAGOLD ~ Centennial Precious Metals. We welcome your inquiry and look forward to working with you.

WEDNESDAY Market Excerpts

February 22 (from DowJones) -- In New York Wednesday after the January Consumer Price Index was described as "mixed" for the metal, prices initially fell but gradually recovered. April gold futures settled unchanged at $556.60.

Overall CPI climbed 0.7% in January, topping the consensus forecast of 0.5%. "This would be bullish for gold," said Tim Evans, analyst with IFR Pegaus. Market participants often buy gold as a hedge against inflation.

"With inflation starting to rear it head again in the U.S. economy, the prospect of further investment being drawn towards gold's safe-haven/anti-inflationary properties looks increasingly likely, leaving gold well placed for a test to $600 later in the year," TheBullionDesk said in a research note.

A trader commented that some support in gold might come from the controversy over the Bush administration's plans to allow a state-owned company in Dubai to take over management of port terminals in New York, Miami and other major U.S. cities.

Critics cited security concerns, while Treasury Secretary John Snow said Wednesday that scuttling a deal would send a message that investment in the U.S. from certain parts of the world isn't welcome.

"It's a very good point," said the gold trader about Snow's remarks.

"If that is the case and the dollar does a little bit of a free-fall, people are going to want to be in gold."

"It's going to be a heated debate and in the short term, it doesn't matter who wins. Because in the short term, you're going to see a possible shake-out in the dollar and it's going to put money in gold, especially from overseas."

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

Black BladeTownie - Nice Pics#1418732/22/06; 18:20:31

I like the pictures but the layout is user friendly and easy to navigate quickly.


- Black Blade

contrarianBubbles...Derivatives#1418752/22/06; 19:21:31

All bubbles end up popped. You look at growth of Cisco in the nineties--exponential. I remember an article about this. Extrapolating the exponentiality at that time, the revenues of Cisco would have exceeded the GDP of the US, which is ridiculous and untenable; subsequently it popped. Ergo derivatives, eventually. So things go on as long as they can, then they collapse, which is the way of things. People are born to die. Bubbles are born to pop. 200 trillion worldwide in derivatives is born to pop. Nothing people can say or do will change that. It's the way of the world.

Also, along the same lines, it may be profitable to add that futurists are generally wrong, as they merely extrapolate current trends, and do not take into account spontaneous and unanticipated events that change the order of things. Like bubbles popping. I think Peter Russell talks about this, but I'm not sure.

MKThanks to TC and a message to all. . . .#1418762/22/06; 19:24:32 When you handle arguably the most important product in the world, it is appropriate for the buyer to see as precise a representation of the real thing as possible. The internet allows us the opportunity to make the presentation for all to see and you have done a spectacular job making that dream a reality -- a technical masterpiece. Anyone who wants to know what the real thing looks like need look no further than these pages. What no one knows but you, me and the staff at USAGOLD-Centennial Precious Metals is that this accomplishment is yours alone from conception through inception and presentation.

Many thanks. Quite an accomplishment all in all.

I will go a step further to inform one and all that we will move forward in building this photographic library as the firm acquires more gold coins -- from the well-known to the odd and unusual. By this we all benefit. By seeing gold as it really is, it creates a market in itself. I have never known an individual to hold a handful of pre-1933 gold coins in his or her hand and not be moved -- viscerally. This is how one comes to understand the real value of gold. These photos are a starting point -- a hint of whats to come from actual ownership.

And yes, we will show the Kim Thanh as promised. . . . .

Last, let me add one more important point: When we started our Specials for the world's various old gold coins some years ago, we didn't have a clue how popular the offers would become. Now these offers quite often are sold out only a few hours after they are posted. It is your interest and patronage of this firm that inspires our work, including our long term commitment to this web site. In turn, it is your purchase of gold from USAGOLD-Centennial Precious Metals which nourishes these pages.

mikal@Contarian - "Bubble" of lies may be the mother of them all#1418772/22/06; 20:19:13

Shadowing Reality - Economist Keeps Tabs on Government's "Creative" Statistical Reports - Walter J. Williams - February 23, 2006
Well known economist and statistician Walter (John) Williams smoothly articulates the history of official U.S. statistical disinformation, beginning in the '60's on GNP(GDP), employment and inflation in this startling, cogent interview.
Amply correlating the results of a growing, huge disparity between reality and official and political reporting, he also shows how Social Security checks would be 70% larger today if calculated using standard CPI methods of the Carter administration.
Most interesting perhaps is his clear view of the future
collapse of the monetary system, the absolute need for some gold connection and the clues he gives about when it will happen.

GoldiloxGold demand hits record in 2005#1418782/22/06; 21:53:06


he World Gold Council today announced that demand for gold had hit a record of $53,6-billion in 2005, with a 26% rise in investment demand in tonnage terms in 2005 and a jewellery demand that was 14% higher in dollar terms than 2004 despite the impact of a volatile price in the last quarter.

Consumers and investors pushed demand for gold to a record level of $53,6-billion in 2005, according to the figures that were published today by the World Gold Council (WGC), with all categories of demand (jewellery, industrial and investment) recording double-digit year-on-year growth in dollar terms.

Identifiable investment demand totaled 600 t in 2005, a 26% rise on the previous year, while jewellery demand rose five per cent, while industrial demand rose by two per cent.

The 2005 figures, compiled independently for the World Gold Council by GFMS, show that the fourth quarter in particular saw substantial inflows of institutional investment into gold.

Investment in Exchange Traded Funds (ETFs) increased by 79 t during the last quarter of the year alone and it is estimated that other institutional investment in the period approached 200 t.

However, the upward surge in the price that resulted from the investment inflows had a negative impact on jewellery demand and on retail investment due to profit taking.

Despite this impact, overall demand in the fourth-quarter was sufficiently strong to absorb a 10% year on year increase in supply and a 12% increase in the price.

Chris PowellAre Fed and Treasury preparing massive intervention in currency markets?#1418792/22/06; 22:10:39

Latest GATA dispatch.

To subscribe to GATA's dispatches, send an e-mail to:

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David LinkleyA New World Order - God help us#1418802/22/06; 22:15:38

For the second time in several months the Fed called for a meeting of the major derivative players. Something about close to 100,000 agreements have not been "cleared" or assigned counterparties. Folks we are now entering economic armaggedon in the US at this very moment. The dollar is about to resume it's bear market as gold explodes higher. Bush seems determined to expand the Middle Eastern war zone to Iran even as the crises in Iraq grows daily and with M-3 reporting ending next month combined with the last Democratic Fed Governer stepping down today the printing presses are ready to break all known records.

Belgian is right, short-term the Euro chart is going to look like a Saturn V rocket as Bush leads the charge to the final breakdown of the US financial system. Terrorism will be blamed as the Executive Branch will consolidate all governmental powers and chaos will follow.

History is about to repeat and those that think otherwise have not learned their lessons well. Get mentally prepared because this is going to be a ballbreaker. Many things we take for granted today are going to disappear. We are going to pay a steep price for neglecting our values of thrift and limited government.

Good luck to all this is my - FINAL POST.

Chris PowellAre Fed and Treasury preparing massive intervention in currency markets?#1418812/22/06; 22:20:10

Latest GATA dispatch -- correcting link.

To subscribe to GATA's dispatches, send an e-mail to:

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Golden LionheartIs Fur Face in danger?#1418822/22/06; 23:02:09

So we lose another learned poster with David Linkley saying its his final post.
Where are these people going? Are the being silenced by the PTB or perhaps the CIA? A black hole?
Now I worry about all the slightly cryptic references to "great happenings" in March. Do I need to keep my cat Fur Face indoors at night during that month?
Today a major Australian Gold Mining Company had its share price fall by nearly 10% when it revealed its problems with hedging. Its all coming to a head.

contrarianLinkley--New World Order#1418842/22/06; 23:30:42

Isn't it interesting how the Soviet Union imploded and the Berlin Wall fell in 1989, having rotted from within, like a corpse eaten by worms. Lies upon lies to the people, you pretend to work, we pretend to pay you, things are great, we've got the power, blah, blah, etc., etc.

And now the same thing here, albeit different circumstances. Same strong military, but disappearance of manufacturing, jobs, statistical lies as John Williams of, the decline of integrity among those in power, get what you can while you can, like the thieves in New Orleans, who, in the midst of disaster, grabbed their plunder with two fists and three shopping carts.

Like the Fed governers: "I'm outta here". Very smart, very smart. Very sad, very sad.

The Invisible HandThe power of ideas – revisited already#1418852/23/06; 02:27:11

If some of the most appreciated posters leave this board, it may be that they are fed up with people refusing to see and hear.
Most "experts" talk about gold as it is viewed at the moment that they are speaking and they say what gold will do tomorrow.
Nobody dares to draw the TV-aholics’ attention to the fact that the 70 years old gold-containment programme is coming to an end. In order to explain that to the said aholics, the TV-"hosts" (I think you call them "hosts") have to convince the aholics to study and the aholics can't do this. (How can you study on TV?) The aholics want immediate satisfaction.
Bush is then very worried and says that the US of A is addicted to oil. "Peak-oil" he says, but he refuses again to place this in the wider context.
Again context-understanding necessitates study and the aholics cannot do this.

Only ideas count, because ideas result in actions and actions result in changes.
The changes are imminent. Why continue yelling fire?

24karatAnother departing poster!#1418862/23/06; 07:11:04

Good luck to you, David Linkley.

I envision some of our former posters hanging out together in a bar, talking about old times on the forum. If this is the case, tell us the time and the place!

GoldiloxDeparted posters#1418872/23/06; 08:12:33

@ 24carat,

I envision the departed posters finding even more ingenious hiding places for their stash, having read the writing on the wall, and probably talking to fewer and fewer people about gold, especially in public places.

Banks and Governments exist to "control" society, and the trend of late has been "the more control the better".

If denying the historical accuracy of the holocaust is worth 3 years in the hoosegow, what is "denying the beneficence of Government and Central Banking' worth?

In 1933, it was worth $10,000 in fines and up to ten years of prison time to believe that the individual could better guard his own fortune, rather than hand it over to the FED for the "collective good".

Spreading freedom and democracy to Afghanistan and Iraq has left it a lot thinner in the home countries, kinda like spreading the same lump of peanut butter to more and more sandwiches. The banksters aren't "giving away" extra peanut butter.

GoldiloxGold hedging out of fashion but compulsion for some#1418882/23/06; 08:19:56


LONDON/JOHANNESBURG (Reuters) - Big gold companies, under investor pressure, continue to shun hedging but small firms are being forced to sell forward to cover the high risk of their projects, analysts say.

The total of global hedging is seen shrinking, albeit at a slower pace, as the rate of project hedging -- selling gold in advance at fixed prices -- would make little impact on the dehedging by industry heavyweights, they said.

"The companies have publicly committed to reduce their hedge books, not to increase them, so I don't expect them to start hedging again in the same way in the near future," Jeremy East, global head of precious metals at Commerzbank, said on Thursday.

As gold trades near 25-year highs, firms may be tempted to lock in prices at today's much higher levels. But stiff resistance from investors, reluctant to see a cap on potential gains, combined with anti-hedging rhetoric by major producers, have limited the scope.

"It will take a change in approach by the major gold mining companies before we see a material change in the whole de-hedging phenomenon," said John Levin, head of marketing at Mitsui Global Precious Metals.

"At this stage, while the pace of de-hedging is slowing, there is no sign of a return to hedging by the majors."

The net outstanding position in the global hedge book fell to 1,666 tonnes by the end of 2005 from 1,804 tonnes in 2004, and is seen dropping further to 1,428 tonnes by December, according to a report by GFMS Ltd. and banking group Investec.

Two-thirds of the hedge book is controlled by big companies like Barrick Gold (ABX.TO: Quote, Profile, Research), AngloGold Ashanti (ANGJ.J: Quote, Profile, Research), Placer Dome Inc. (PDG.TO: Quote, Profile, Research) and Newcrest (NCM.AX: Quote, Profile, Research).

Barrick, which holds a huge hedge position but has said it wants to reduce this, has become the world's largest gold producer after a takeover of Placer.


Barrick wants to "reduce hedging" - uh huh, and taking over another major hedger, Placer Dome, is really moving in that direction. Sounds like a lot of "booyah" to me.

Liberty HeadRead the link and weep#1418892/23/06; 08:43:32

When there is big money and big power to gain in financing both sides of the nuclear threat, there is also big money and big power to lose.

Don't be one of the losers.
Get gold.

Best Wishes

tejbearGoldilox #141887#1418902/23/06; 08:49:04

Departed posters,

Scary thought, but it "rings" with truth. I guess this is a time for all of us to reconsider our posts, given the depth of big brother's loathsome plan….

Are Bush & Cheney the anti-Christ team?

The Bear

tejbear"Currencies slide on contagion fear"#1418912/23/06; 08:52:37


"Emerging market and high-yielding currencies fell sharply in European morning trade on Wednesday as Tuesday's sharp slide in the Icelandic krona unnerved investors.
The krona suffered its biggest one-day fall against the US dollar for most five years on Tuesday, tumbling 4.6 per cent, as Fitch lowered the outlook on Iceland's country rating from "stable" to "negative", citing an "unsustainable" current account deficit and soaring net external indebtedness."

Bear: Looks like the currency markets are getting very nervous.

The Bear

mikalGold and U.S. dollar charts#1418922/23/06; 12:02:36

Gold Continuous Contract [April 06]Pit and U.S. Dollar Continuous Contract[March 06] Pit
Last night Jim Sinclair's gold chart showed a nice channel formation which will undergo revision on a more frequent basis IMO.
Also on last night's chart, U.S. dollar breakdown appears familiar, but appearances are deceiving- IMO this weakness may snowball before summer, but since gold's latest
outperformance remauins intact in spite of past dollar strength, any continuation of the dollar bear in the intermediate to long term could cause gold to ridse so high that the media will ignore it perfunctorily, consistent with the trends toward overextended societal disconnectedness. Can the bull be any stealthier than this? No. It doesn't get any better than this. Who's that we see lurking just in the background? Why it's Gandalf. Bring out the hounds. :)

GoldiloxCurrencies #141891#1418932/23/06; 12:08:13

@ Bear,

When they are backed by nothing but "promises", they are even more subject to the whim of the market manipuators.

Perception is everything - NOT, but it works for those who live purely for "spin".

Clint HDeparted posters#1418942/23/06; 12:28:35

Perhaps they have had a visit from John Galt.
TownCrierTreasuries fall as five-year auction deemed a flop#1418952/23/06; 12:29:06

NEW YORK, Feb 23 (Reuters) - U.S. Treasury debt prices extended losses on Thursday after an auction of five-year notes garnered surprisingly weak demand, including from indirect bidders. That category includes customers of primary dealers but also foreign central banks, and it is therefore used as a proxy for offshore interest in U.S. government debt.

"It was a terrible auction," summed up one trader at a U.S. primary dealer. "The bid-to-cover stank, the indirect bid was bad -- I would be surprised if the market manages to rally from here."

...indirect bidders bought a meager $2.96 billion or 21.1 percent of the deal, compared with last year's average 38.13 percent. That left dealers holding the bag with $10.72 billion or 76.6 percent.

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

In extremis paper is accepted by nobody in exchange for items of tangible value. Will you be among those left holding the paper bag?


TownCrierFederal Reserve steps up to plate, buys Treasuries outright#1418962/23/06; 12:46:46

Following Tuesday's $1.248 billion intervention, the Fed again today stepped into the open market for an outright purchase of $948 million in U.S. Treasuries, thus injecting a new 'permanent' supply of money created expressly through this transaction.

At the time the market in fed funds had been trading in line with the 4.5% FOMC policy directive. In the operation, the Fed's trading desk targeted Treasuries maturing out on the yield curve from May 2014 to May 2030.

Given the ability to absorb and monetize the debt domestically, and given the multi-decade track record of international support of the "exorbitantly privileged" dollar nonetheless, the U.S. government probably won't lose much sleep worrying about today's weak turnout of indirect/foreign bidders at the Treasury's auction of five-year notes.

But one day...


GoldiloxBarrick gets hammered#1418972/23/06; 13:03:44


Shares of Barrick fell C$2.03, or 6 percent, to C$31.62 on the Toronto Stock Exchange, underperforming the TSX's gold sector, which was off 1.7 percent. On the New York Stock Exchange, Barrick lost $1.50 to $27.44.

Barrick, set to become the world's largest gold producer once the Placer deal closes, forecast the combined company would produce between 8.6 million and 8.9 million ounces of gold and about 350 million pounds of copper this year.

Total cash costs are expected to be between $275 and $290 an ounce of gold and about $1.10 per pound of copper.

Analysts were expecting output of more than 9 million ounces of gold, and cash costs around the $250 an ounce mark.

"People were expecting better news in terms of the production outlook of Barrick and costs seem to be higher than expected," said Michael Fowler, an analyst with Desjardins Securities.


Barrick, already delivering much of its margin to hedge counter-parties, looks like it also took a hit from the "hidden costs" of hedging, as rising energy prices added about 10-20% to its cost post of production.

TownCrierRogers junks dollar-gold correlation#1418982/23/06; 13:31:02

New DelhiFebruary 24, 2006

"A large section of the market has established an inverse correlation between the dollar and the yellow metal. However, it does not work that way as each has its own rhythm. The two may move in the same direction at times but there is nothing to prove their correlation. On top of it, the dollar is a flawed currency," said commodity guru Jim Rogers at a seminar on Investment Strategies in the Global Market.

The idea of inverse correlation had gained ground in the market from the fact that when gold prices, quoted in the US dollar per ounce unit, fall, it becomes cheaper in other currencies.

Also, historically, all central banks have managed their respective wealth reserves in gold and dollars, following which the yellow metal has emerged as a stable alternative to the dollar.

Rogers said gold prices would rise to US$900 an ounce in two years. At present, the metal price is hovering between $550-560 an ounce and its all-time high was $850, seen in January 1980.

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

Not the sharpest tool in the shed, but hey, when the media somehow always seems to find it handy...


MKA question for the Table Round#1418992/23/06; 14:04:30

As Gandalf would say, "put on your thinking caps"!

From TC's posts we can see that roughly $2 billion of the $7 billion needed to cover the note auction has come from the Federal Reserve -- a clear case of gunning the printing presses.

Should we be connecting some dots here?

**The failed Treasury auction.

**The new intervention powers in the currency markets granted the Federal Reserve.

**The elimination of M3 as a measuring device.

Let's assume for a moment that all three events are related. How would you connect the dots?

mikalGold highlights primates priorities#1419002/23/06; 14:04:33

They Only Fix What's Broken - Rob Kirby - Feb 23, 2006
Analysis of 1968 London Gold Fixing during a Dow crash sheds light on current market fundamentals, with references to GATA and the BIS.

mikalGold highlights primates priorities#1419012/23/06; 14:04:51

They Only Fix What's Broken - Rob Kirby - Feb 23, 2006
Analysis of 1968 London Gold Fixing during a Dow crash sheds light on current market fundamentals, with references to GATA and the BIS.

mikalI'm INNOCENT!#1419022/23/06; 14:09:09

Sorry for the double post. This public computer I'm using has also gone ape, giving an error message "unable to send" and then sending regardless. :X)
USAGOLD Daily Market ReportPage Update!#1419032/23/06; 14:50:00">
The Daily Gold Market Report has been updated.

If you are considering investments in gold we invite you to">request our free introductory information packet detailing the products and services offered by USAGOLD ~ Centennial Precious Metals. We welcome your inquiry and look forward to working with you.

THURSDAY Market Excerpts

Gold slips on options-related trade

February 23 (from Reuters, MarketWatch) -- Gold bullion slipped nearly 1 percent on fund and technical selling on Thursday, with the market extending losses in U.S. hours as COMEX gold futures fell in mostly options-based trade.

U.S. traders pounded gold in the afternoon before COMEX options expiration after the New York close and amid cheaper crude oil prices, market sources said.

"It was COMEX options expiration today, so they got gold down near the big strike price at $550," said Leonard Kaplan, president of Prospector Asset Management in Evanston, Illinois.

The April contract fell $5.70 to finish at $550.90.

Gold had surged to a 25-year high of $574.60 an ounce earlier this month before slipping as low as $535 last week.

"The underlying attitude towards metals in general and gold in particular is still positive. The bias still has to be to the upside, but people are reminded that this isn't a one-way street," said Stephen Briggs, economist at SG Corporate and Investment Banking.

"This slump will be likely followed by a good rebound as we get into next week," said Jon Nadler, an investment products analyst at bullion dealer Kitco, adding that for now, "people want to test the lower end of the range. ... The pattern of trading remains confined to the $540-$560 range and each smaller move has the precision (and excitement) of a chess match. If someone were "to liquidate a position, there will be another party willing to take an opposite stance," he said.

Meanwhile, the minutes released from former Federal Reserve chief Alan Greenspan's last interest-rate meeting showed that Richmond Fed President Jeffrey Lacker dissented from votes to authorize the Fed's trading of foreign currencies, including the euro and yen, according to Peter Grandich, editor of the Grandich Letter.

This raises two questions: "Why does the Fed think it must be prepared to intervene ... and if they're willing to intervene in the currency market, how about the stock, bond or gold market?"

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

Chris PowellMajor Peruvian newspaper reports on the manipulation of the gold price#1419042/23/06; 15:33:22

Latest GATA dispatch.

To subscribe to GATA's dispatches, send an e-mail to:

This email address is being protected from spambots. You need JavaScript enabled to view it.

SundeckDiffering cultural perceptions of gold...#1419052/23/06; 17:18:56

I have an acquaintance, a woman of Fijian Indian extraction, who owns a restaurant hereabouts (Australia). I often see her wearing gold jewellery of one kind or another...but from the colour, and its pendulous form, I would say it is nearly all 22-24 carat. We talk from time to time about gold.

As you all know, the Indian people are great gold bugs, and it seems the bug has travelled abroad, over time, with the Indian diaspora... Her husband, also Indian, has several brothers. She tells me that their mother (her mother-in-law) is quite well-to-do and, as part of the sons' inheretance, she has a "bucket full of gold" for each, which she adds to from time to time!!

In spite of her obvious passion for gold, she seemed to know little about the "gold trade"; in particular, the importance of investing in gold in the current climate. I loaned her my copy of MK's book, "The ABCs of Gold Investing", but after six months she returned it...still unread! Perhaps there was little in it to arouse her interest...little that was not already firmly implanted in her psyche through long, cultural associations and implicit trust in gold.

...bit like me loaning an Inuit a book on "The ABCs of Ice Fishing".


Chris PowellGrandich induces CBSMarketWatch to mention Fed's currency rigging plans#1419062/23/06; 18:40:17

Latest GATA dispatch.

To subscribe to GATA's dispatches, send an e-mail to:

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ToolieMK's question #1419072/23/06; 19:17:52

Ok, the thinking cap is on; I'm giving the propeller a mighty twirl.

Well... the failed treasury auction indicates that the US is going to have trouble financing its debt. Which implies higher rates are coming – high enough to worry the fed about serious consequences for the economy. If the treasury rates were to rise to the point where a successful auction was ensured, that would put an undesired upward pressure on the dollar.

The new FED intervention powers permit greater direct influence of foreign currency exchange rates.

M3 = M1+M2 and dollar balances at foreign branches of US based banks. I'm guessing that the reason for the decision not to publish these figures is to allow the fed to provide funds to US banks as the Yen carry trade and derivatives unwind, without drawing attention to dollar disinvestment or the large amounts necessary to guarantee liquid markets.

So my expectation is that while the FED expects to walk a tightrope between crashing the dollar and sending rates so high that several sectors of economy go through the windshield as it eases the dollar down and gently raises rates.

keepin’ my dunce cap handy, just in case. On second thought I'll just put it on now, go to the corner and hope Gandalf feels enough pity to come by and give me some stars and moons to stick on it. Oh, maybe should bring my crash helmet too.

Black BladeInverted Yield Curves and M3#1419082/23/06; 19:37:43

I will try to cover the M3 cover-up later as I am in the process of working through some detailed info on the subject (note that Rep Ron Paul (R-TX) and another Congressman brought up the subject with the new Fed Head before the committee last week). However, on another note - did anyone happen notice that the inverted yield curve widened by at least 20 bp earlier today? It was briefly mentioned by one of the carnival barkers on CNBC. I think that this is a clear sign that an "inflationary recession" is about to strike - an "economic tsunami" if you will. No one seems to notice the shocking impact of this and yet it was simply blown off and ignored by the so-called "experts" in the financial media. If you don't have a modest position in "portfolio insurance" by now you had better get cracking. Maybe a little trip down the hall to the "Castle Treasury" is in order. ;)

- Black Blade

Black BladeAverage American Family Income Declines#1419092/23/06; 19:42:40

Average American Family Income Declines


WASHINGTON - The average income of American families, after adjusting for inflation, declined by 2.3 percent in 2004 compared to 2001 while their net worth rose but at a slower pace.

The Federal Reserve reported Thursday that the drop in inflation-adjusted incomes left the average family income at $70,700 in 2004. The median, or point where half the families earned more and half less, did rise slightly in 2004 after adjusting for inflation to $43,200, up 1.6 percent from the 2001 level.

Black Blade: Losing ground on the treadmill. Yet we continue to hear about "core rate" and "benign inflation". Gotta luv that BLS government "data massage".

Black BladeTreasurys end lower after 5-yr auction - U.S. demand was solid, foreign central bank bid weak #1419102/23/06; 19:57:31

Treasurys end lower after 5-yr auction


There is intense debate about the significance of the inverted yield curve, which effectively removes the incentive for making long-term loans and which some economists believe signals recession. (Black Blade: It always has been a signal of coming recession)

However, new Federal Reserve Chairman Ben Bernanke believes the inversion merely reflects strong foreign demand for U.S. instruments. (Black Blade: Huh? Come again!)

Philadelphia Federal Reserve President Anthony Santomero offered a bit of hope to investors who are eager to see the Fed wrap up its rate hike series.

He told an audience that the economy is moderating to a sustainable pace, inflation is contained, and monetary policy is close to where it needs to be. (Black Blade: Only in his wildest hallucinations!)

Investors are eager to learn what Bernanke will say in a speech Friday, but his address will be given after the close of trade, so it will not influence the day's price action. (Black Blade: Ain't that typical. Hmmm...)

Black Blade: I think I'm gonna puke. The new Fed Head doesn't even understand what the inverted yield curve means or what the dire economic implications are. Thankfully most of us are prepared and for those who aren't:

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. This could get ugly - very ugly.

SundeckMK's question...treasury junk bonds, currency intervention, and the "black" M3 economy#1419112/23/06; 20:33:10

Mmmmm...what to do today...what to do today?

Maybe try to connect the dots...

You know what puzzles me about the proposed US currency intervention? While the Fed has infinite ability to print US-dollars, presumeably it DOES NOT have ANY ability to print Euros, or Yen, or Pounds Sterling, or any other fiat currency of any other land. And with its trade and fiscal deficits hanging like two dead albatrosses around Uncle Sam's long, scrawny neck, I don't see that he can have much in the way of FX reserves to be able to exhibit too much flare at the FX tables...

I suppose he has gold...supposedly 8000 tonnes of it...but without audits for more than a generation (??), who knows exactly how much gold he REALLY has to play, on the table...or how much he must first dig out of the ground...deep storage, you might say...before he can say: "Here's lookin' at you Ducky, and up another tonne!"

Now, I am no currency trader, but it seems to me if you want to push some country's currency DOWN by selling it on the FX markets, and you don't have much in the way of that country's currency to start with, then your game-plan is gonna be fairly brief...and not all that uncertain... Sure, there are a large number of tricky things that big-time FX traders can probably do, but for a dumb farmer's kid like me, counting the number of chickens that leave the coup in the morning and comparing it with the number that return in the evening tells you what your net gains or (more likely) losses are.

However...remember that what the Fed CAN do is create dollars as easily as a low hanging cloud can create snow-flakes in Winter...

...and would Uncle Sam relly want to lower the exchange value of another country's currency anyway? Isn't that what all the other countries have been doing - weakening their currencies versus the dollar - to preserve their trade position with and against the USA. It seems more likely to me that Uncle Sam wants to INCREASE the exchange value of a whole lot of other countrys' currencies versus the dollar to snuff-out this pesky annoying behaviour. If other countrys' currencies become strong versus the dollar, those countries can buy more from the USA, thereby making the US economy more globally competitive and, over time, lessening the current account deficit. Simultaneously, Americans will tend to buy more locally-made stuff and less from overseas...with similar effect...and, Hell, even if Uncle Sam really, REALLY, desperately needs to acquire stuff from overseas, well he can just print whatever damn dollars he needs, go buy it, and whosa gonna stop him?

Of course, all the other players (errr countries) are gonna get suspicious when they see their winnings mounting, but that Uncle Sam's pile of chips never seems to be getting any smaller. They might start to suspect that Sam is a-reachin' under the table and bringing out counterfeit chips; so he needs to disguise it as best he can... Well, he never shows them how big his pile is to start with! "Poof!" There goes M3...

"What M3 are you referring to, Honey Bun? Is the the swanky new Caddy with the lay-back seats?"


But you ask: "What about treasury bonds...who's gonna be buyin' them?"

"Hell, we are man...Uncle Sam, that is! We just go to the ways-n'-means committee and show them our printing press. They will see instantly that we have both the ways and the means..."

"OK, you're on a winner there. But what about all those guys who hold our debt? Won't they get a bit pissed-off being paid in Monopoly money?"

"Weellll, as some-one said once before: 'Sure, it's our currency, but its yourrrr problem!' ...and besides, if anyone complains, we will just tell them it is China's fault!"


"So, Daddy, what did you see when you connected the dots?"

"Shut up son and go back to aint mornin' yet."

"I can't sleep, Daddy...that noisy helicopter keeps flying back and forth. Is that Santa delivering Chrismas presents?"

"You could say that, son. Now go to sleep."


Gandalf the WhiteGood START there, Sir Toolie ! <;-)#1419122/23/06; 20:42:45

I award you one GOLD star and a crescent shaped MOON for your hat !

Black BladeInverted Yield Curves#1419132/23/06; 20:48:15

Well here they are:

6-month notes yield 4.72%,
2-year notes yield 4.72%,
3-year notes yield lower at 4.68%,
5-year notes yield lower at 4.61%,
10-year T-bond yield still lower at 4.55%.

My oh my!

Can you say "recession"? I knew you could.

specie-manInverted Yield Curve#1419142/23/06; 22:47:54

I think we are in a recessionary "soft patch" RIGHT NOW. It just happens to be during an inflationary era !

In a weird way, I agree with Bernanke. The current inverted yield curve does not necessarily signal a recession ahead. If interest rates were set by free markets, then an inverted yield curve probably WOULD signal a recession on the horizon.

But interest rates are not currently set by free-market forces !! They are set by interventionalist forces. So all bets are off (or on, depending upon how you look at it).

The FED can engineed whatever yield curve thay want - simply by buying (or not buying) various maturities of US Treasury Bonds. And why might they engineer an inverted yield curve ? Maybe to try and tame inflationary forces while at the same time avoiding the total rupture of the housing "bubble".

And why has the FED announced (via their recently-released meeting minutes) that they are setting up a mechanism to trade certain foreign currencies ? If I had to guess, I'd say it has something to do with attempting to smooth out some disclocation pressures (unmatched trades) in FX derivatives land to the tune of 25 billion dollars.

PS: Good luck to all - THIS IS not MY LAST POST.

CaradocWhat?#1419152/24/06; 03:53:54

Let's see. Barrick and South Africa both say that there's going to be less gold supplied. So the price of gold does what? It goes DOWN! Uh huh....


HenriOptions expiry?#1419162/24/06; 07:21:37

Is it options expiry Day? If so the early rally to $555 in NY is going to be problematic for those trying to not pay out on the $550 calls. The buyers are going to make this difficult for the shorts. It's an "in your face" move. LOL No doubt the shorts will get their way by the COB
OvS"Dumb" Farmer's Kid.#1419172/24/06; 07:41:07

You've got a lot of
common sense, me boy,
and you could run
circles around those
New York boys.
But do you have that
nimble mind to con-
cocked all those
trickster's schemes?

HELL NO, who would
want to run around
with a morphing head
like that?

Back to the plough...

mikalGold spikes on morning news?#1419182/24/06; 08:02:36

Precious metals have been oversold on my charts and have no way to go but up. Once today's terrorist related news about the apparently foiled attempt on a major Saudi refinery ceases to cause short-term volatility, gold will still be seen moving up. Nonetheless, according to Jim Sinclair, one ATTEMPT such as this morning's on a major Saudi refinery would be very significant for gold.
Gold may not REALLY outperform until some perceived trigger or series of triggers which in hindsight may not have been necessary anyway. This is a secular, generational bull market, with historic, incredible, ongoing cumulative fundamentals and a technical picture that must also frequently be updated as the alternatives to gold become more and more unattractive.
The report of durable goods orders plummetting today shows one small slice of the pie of symptomatic sickness and economic retraction. Perhaps gold performs best when there is no news such as today's and everyone least expects it. And that could come anyday IMO.

mikal@Henri#1419192/24/06; 08:06:52

Comex gold and silver options expiry was yesterday. Not sure about the over the counter(OTC) market. See yesterday's daily market report at the link above for details. Regards
HenriOptions#1419202/24/06; 08:15:18

Thanks Mikal...wasn't really sure. Guess it goes to the point that some posters waste bandwidth with their spontaneous thoughts neither well thought out nor even cursorially researched. Guilty! String him up boys!
tejbearMore Oil Gloom#1419212/24/06; 08:53:56

Snips from "Fuel - The Catalyst!" by Puru Saxena:
"Whether you are aware of it or not, we are living in a highly inflationary, war cycle. The money supply is surging at an alarming rate and nations continue to out-bid each other for natural resources. In a nutshell, the mad scramble for commodities is on! Unfortunately, this dangerous fight may only get worse in the future. Glimpses of this are already unfolding with the geo-political unrest brewing in the middle-east……."

"Let's review the daily output of some of the largest producers in the world. Saudi Arabia is at the top of the list and produces roughly 10 million barrels, followed by Russia - a close second. What is ominous is the fact that each of the top five oil-producing nations (with the exception of China) still produces less oil today than it did in the past! In other words, (despite claims of endless reserves) Saudi Arabia and Russia have failed to match their record production levels recorded in the early 1980's!"

Bear: I agree with Puru's assessment. What is really sad is the "blissful" picture painted daily by the media in the US. It appears most Americans, and for that matter, most of the people in the world are about ready to be "blind-sided" by the rapid deterioration of the world economy.

Most of my friends are in denial…. Got gold?

The Bear

GoldiloxOil production#1419222/24/06; 09:22:29


The question must be asked:

Is their capacity declining, or noting that war is in the wind, are they "holding back" production to feed the higher margin demand that war will create?

We've certainly seen reports from Simmons, et al, that reflect declining production capacity, but also the book by the chaplain of the Alaska Pipeline that suggests that the US is purposely trying to conserve "assets in the ground", and Prudhoe Bay is just the tip of the oil-berg.

It doesn't seem at unlikely to me that the oil powers would tap the foreign sources while prices are low, and hold back domestic production for higher (and safer) returns later.

Lots of confusing noise out there!

GoldiloxClimbing the Mountain#1419232/24/06; 09:35:29


For most Americans borrow and spend has become a way of life made possible by decades of declining interest rates and rising asset prices. The '80s and '90s bull market in stocks, followed by a bull market in real estate, prompted Americans to forget their savings accounts. Most Americans have seen their assets appreciate—whether the family castle or the stock portfolio. All of this abundance (asset appreciation) and low cost borrowing was made possible by a loose monetary policy carried out by the Greenspan Fed. As alluded to above, inflation primarily worked its way through the financial markets inflating assets along the way. The combination of a bear market in commodities and cheap imports from Asia has kept consumer prices moderate as measured by the BLS. I would submit that over the last five years most Americans have experienced above-average trends in their cost of living—core rate notwithstanding. The Fed seemed to be able to work its monetary magic as it inflated and expanded credit without suffering the inflationary consequences of its actions.

I believe that we are now at an inflexion point. Things won't be as easy in the future. Decades of inflating are now about to play catch up. Review the two charts below, which show the 10-year t-note and CRB index. Note as commodity prices inflated in the late '60s, the parallel course in rising interest rates. Conversely, when commodity prices fell throughout the '80s and '90s, interest rates came down as well. This period was a period of disinflation.

Since bottoming in 2001, commodity prices have moved up relentlessly and there appears to be little sign of reversing course. While commodity prices have soared, long-term interest rates have consolidated and virtually gone nowhere. Rates have been kept artificially low as a result of central bank intervention, the carry-trade, and the relentless pursuit for yields in a yield-starved environment. Everyone is waiting for the Fed to end its rate-raising cycle. They believe that when it does, long-term rates will recede. Don't bet on it.

This hasn't been a normal rate-raising cycle. If what I suspect is correct, we are about to embark on another journey up that mountain. It may be quick. . . it may be slow. No one knows at this point. However, I believe it's time to get out your rock climbing equipment again. Rising inflation is going to find a companion in rising interest rates.


From Puplava's "Captain's Log", he feels this time "things really are different," but not in the non-chalant manner expressed by Wall St. and the FED.

tejbearGoldilox #141922#1419252/24/06; 10:11:05

Oil Production

By the "looks" of things, it does appear that "the powers that be" have worked at limiting domestic oil production and saving it for a rainy day, but I am inclined to think it was just dumb luck. Remember when Prez. Reagan sat still while the oil patch in Texas, Oklahoma, and Louisiana went bankrupt after Saudi Arabia drove the price of a barrel of oil to $8? The companies, workers and economic viability of the entire region were hit hard for over a decade. More of that "compassionate" conservatism.

What has the current administration done right? Bless environmental pollution? Promote global warming and the associated storm/weather damage? Cut spending on alternative energy development year after year? Tax cuts to the rich, while chopping one social program after another? Let's not forget the dumb-ass war in Iraq & the pending one with Iran……

Given the depressing level of government performance, it is dubious at best that the powers that be or the government had any intelligent plan.

Here in SoCal, I see Excursions on the road, everywhere……

The Bear

GoldiloxOil and consolidation policies#1419262/24/06; 11:32:22

@ bear,

Looking at it from that perspective, withholding US oil production looks pretty smart, despite some local industry "collateral damage", something that Asian Job-jacking has demonstrated is of little concern to the globalists.

Considering all of the planets in our Solar system are concurrently experiencing "global warming", and the Venusian probes brought back strong evidence that Sagan's "greenhouse effect" is bad science at best, I would fault them more for stifling real meterological research than promoting global warming.

However, your list of other judgement failures rank right up there, as well, but one also has to consider the potential for ulterior motives from the past four administrations who have shown themselves to be so closely aligned with globalist agendae.

I'm also wondering how all the consolidation in the mining patch fits into the globalist/banking agenda. It's a lot easier to keep a few mega-miners in line than hundreds of "wildcats".

TownCrierGold(mines) versus Google#1419272/24/06; 12:11:40

24 Feb 2006, [] -- "ARE gold mines supposed to make profits?" my 22-year-old asked me the other day after the release of their latest lot of poor quarterly reports. I couldn't help thinking back 26 years, when the gold price reached US$800/oz.

Some, like Kloof and West Driefontein, then sometimes made a profit. But the investors’ favourites, such as Village and even Harmony, were never able to make a profit -- even though the gold price rocketed at the time. Higher costs and lower ore grades simply wiped out the higher gold price.

So whether gold mines are supposed to make a profit remains a valid question. Surely the purpose of any business is to make a profit? It's only Section 21 charity organisations that don't have to make a profit. However, the JSE -- or any other share market worldwide -- doesn't require companies to have to make a profit to remain listed.

Investors in gold shares place little store on the profit recorded by a gold mine, let alone a dividend. They're apparently more interested in things such as the US dollar price of gold. The quantity of gold reserves seems to be more important in determining the share price than the profit made by the mine

The question must surely be: Is it necessary for a gold mine to make a profit before investors go for it? The answer is an easy "no". It's a long time since Harmony last made a profit and it doesn't look as if it's likely to make a decent one soon.

...About two weeks ago, Google – American investors’ sweetheart for the past two years – said that its profit growth for the next year or so could perhaps be slightly lower than the 50% to 100%/year generally predicted. Investors didn't like that and Google received a sharp slap. With the result that the technology giant's price fell by 27% to $345/share over the past six weeks. Some commentators even feel it could drop to $200/share.

Unlike gold mines, Google IS earning a profit. It's only the profit growth that's lower than investors’ expected. Google is currently trading at a price:earnings ratio of 68. That's expensive and means that investors are prepared to pay now for the next 68 years’ profits...

Compared to Google, our gold shares still look expensive. But then we return to our original question: Are gold mines supposed to make a profit?

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

In their rush to invest, it often seems that would-be shareholders simply fail to think things through very thoroughly. Investment in a mine is effectively an investment in a depleting asset (a bomb with a burning fuse) in which that mine crawls closer to mothballs with the passage of each and every day in which th elimited ore is extracted and pinched of its gold. Rarely or never do shareholders see one iota of this precious metal, nor, as this article puts forth, do they usually see outsized profit performance -- even at such times as the market price of the metal is booming.

The reason behind this apparent (non)profitability paradox is that, because the company is mining a limited and depleting orebody, at such times as the goldprice rises and shareholders might naively think this would translate to greater profits and possibly dividends, two phenomena always intervene.

The first phenomenon is that the mining CEOs want to keep their cushy salaries, and all of the mining staff also want to keep their jobs going as long as possible.

The second phenomenon is a correlary to the first one. In an effort to extend the mine life while the price of gold is high, the company will begin mining in the more marginal regions of the ore body, thus increasing their costs per ounce of recovered gold in such a way that the operations always trend toward merely break-even profitability.

Another related practice that eats into a shareholder's stake in net profits is that in addition to the costs of mining of marginal ore, the company's available gross earnings from a rising price of gold are sometimes channelled into exploration and acquisition of other ore bodies such that the whole break-even dance can be continued when the existing mines have been completely pinched.

As an investor looking for ENDURING value, it behooves you to choose the metal. On the other hand, the most reliable way to make money from mining companies is not as one of their shareholders, but rather as one of their staff/employees. And even then, it would behoove such an employee to earmark some of his salary for gold just the same as with everybody else -- the butchers, the bakers, the candlestick makers.


GoldiloxHUI watch#1419282/24/06; 12:11:51

319.xx, up 6.90, or 2.2%

All green on the HUI front with a couple of exceptions, based on immediate company news.

TownCrierGeopolitical/energy turmoil#1419292/24/06; 12:53:47

Feb. 24 (Bloomberg) -- Crude oil jumped after Saudi Arabian forces repelled a suicide attack on the Abqaiq processing center, which handles about 7 percent of world supply.

...``This market is already kind of on tenterhooks,'' said Peter Beutel, president of the energy consulting firm Cameron Hanover Inc. in New Canaan, Connecticut. The attack ``comes on the heels of a series of attacks in Nigeria, launched by an insurgent group against oil facilities there.''

Prices rose earlier after rebels threatened to escalate attacks in Nigeria, Africa's largest oil producer.

...Iraq has imposed a curfew in Baghdad and three nearby provinces in a bid to end violence between Sunni and Shiite Muslims sparked by a bomb attack on a Shiite shrine. The bombing prompted warnings of a civil war.

Iraq, which has the world's third-biggest proved oil reserves, produced an average 1.53 million barrels a day last month, the lowest since August 2003.

...Venezuelan President Hugo Chavez will bar Continental Airlines Inc. and Delta Air Lines Inc. from flying to the country until Venezuelan carriers are allowed to expand service to the U.S. Venezuela's relations with the U.S. have deteriorated since Chavez was elected president in 1998.

Chavez has said the U.S. is seeking to assassinate him, while U.S. officials have said Chavez is a threat to regional stability. Venezuela, the world's fifth-largest oil exporter, was the fourth-biggest source of U.S. imports last year.

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

How well will the value of paper accounts stand up against increased heat and pressure?

Choose the tangibility of true wealth afforded by gold ownership, and thus have one less thing to worry about in these tumultuous times.


BoilermakerConnecting Dots for MK#1419302/24/06; 14:51:18

I did a little research on M3 because I know very little about it. Here's what I know now;
US M3:
= M1 (currency in circulation + overnight cash deposits + demand deposit balances + travelers cheques + checking accounts)
+ M2 (time and savings deposits below $100,000 + retail money market accounts)
+ time deposits above $100,000 + repurchase agreements + institutional money market accounts + Eurodollars held by US residents.

The repurchase agreements caught my eye. This is the Fed's EZ cash source to lend to "cooperating" banks and financial firms. It's the stuff they've used to juice the ailing stock market and it seems likely that the Fed has plans to juice the bond market and manipulate currencies through additional heavy doses of repo financing. This needs to be done away from the bright lights of prying eyes.

tejbearBoilermaker # 141930#1419312/24/06; 15:34:29

Nice Post on M3 :)

I was able to get a fellow co-worker who is attending UCLA for an MBA to ask his economist teacher what the significance of the Fed's decision to no longer publish M3. The teacher informed my buddy that there was no impact, M2 is just as comprehensive.

I wonder if that's why he teaches...

The Bear

USAGOLD Daily Market ReportPage Update!#1419322/24/06; 16:24:22">
The Daily Gold Market Report has been updated.

If you are considering investments in gold we invite you to">request our free introductory information packet detailing the products and services offered by USAGOLD ~ Centennial Precious Metals. We welcome your inquiry and look forward to working with you.

FRIDAY Market Excerpts

Gold gains $10 on day, up 1% on week

February 24 (from Reuters, MarketWatch) -- U.S. gold futures raced up almost 2 percent Friday on investment buying after an attack outside a Saudi Arabia oil plant and news that U.S. durable goods orders plunged in January, dealers said.

COMEX April futures rose $10.30, or 1.9 percent, to settle at $561.20.

"We have a good rally going on because of what's going on in Saudi Arabia," George Gero, vice president at RBC Capital Markets Global Futures, said.

"It is Friday and nobody wants to be short the gold over the weekend, so up go all the metals."

Long considered a "safe haven" by investors, gold rose as crude oil shot up to near $63 a barrel after news of a suicide attack at the huge Abqaiq oil facility, which sparked worries about supply from the world's top oil producing country.

A gold trader said heavy short covering lifted the metal after the Saudi news and also because of "surprisingly weak" durables data. Volatile durable goods orders posted their biggest drop in 5-1/2 years last month, and the 10.2 percent fall far surpassed expectations of a 1 percent drop.

"The news of an attack on an oil facility in Saudi Arabia is just an example of the many different geopolitical events that underpin the secular gold bull market," said Peter Grandich, editor of the Grandich Letter.

"Throw in real physical and investment demand, inflation fears, currency turmoil, manipulation and shrinking mine supply, and you should realize a gold bear may want to stay in hibernation long after winter ends," he said.

"The mere thought of an organized, expanded terrorist effort to sabotage the West's oil lifelines (and thereby its economies) has people looking for cover and heading straight towards gold," said Jon Nadler, an investment products analyst at bullion dealers Kitco.

"The market finds itself compelled to react to overwhelmingly distressing developments coming from the across the globe," he said, adding that "whatever strength technical and fundamental factors previously contributed to gold prices, they are now taking a back seat to geopolitical realities and their effects on investor psychology."

With Friday's jump, COMEX gold futures broke above key technical resistance at $560 an ounce. Chartists put next resistance at $570 and $579.50, with support at $550.

Early this month, gold rose to 25-year highs on investment demand fueled by high energy prices, perceived long-term weakness in the U.S. dollar, and geopolitical tensions.

Gold's all-time high was around $850 an ounce in 1980.

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

GoldiloxSilver looking better to Gold miners -Repost without offending references#1419332/24/06; 17:14:21

I noticed my post referring to a couple of gold/silver mergers was deleted, and I hope I am correct in assuming it was deemed to contain too much "individual stock detail" to be appropriate.

The gist of the information, without renaming the principles, is that some of the more growth-minded gold miners are absorbing silver producers - welcoming their red-headed step-cousins back into the family, so to speak.

While the industry media is focused on mergers of mega-hedgers, some gold miners are taking a stronger interest in silver properties that show increased potential in the near $10 silver market.

(reference details at the other castle)


Clink!Curious silver close on Comex#1419342/24/06; 20:23:28

I thought the relatively huge spike right at the end of the Comex looked rather peculiar. Murphy commented about it at the Cafe tonight :-
Here is what happened. A small firm, Arch, bid for a piddly 200 lots on the close. There was NOTHING for sale, so he kept bidding to fill his market order. He hit every small offer in sight. Regardless of the reason WHY silver did what it did, and on so little volume, this should spook the shorts that it could happen … for any reason … especially with oil and gold SO firm.
End snip
I thought this kind of thing only happened either out of hours or with stocks with little liquidity. Not at the Comex ! Makes you wonder. There may be a shortage of silver, but now silver paper too ?

Ten BearsHenry C K Liu and Jim Willie#1419352/24/06; 21:23:25


>Rubin, a Wall Street bond trader who became US Treasury secretary, is an internationalist whose idea of America does not extend west of the Hudson River. Politically, the Wall Street internationalists, not all of whom are Jewish, appeased the opposition by deregulation of the banking and finance sector so that non-New York financial firms could get in on the action. In reality, the New York banks ended up turning all banks across the nation into their local branches. Banks in the US, instead of being local financial pillars that prosper only with the local economy of their domicile, now can profit from destroying the local economies.

>To defuse political backlash of falling wages in the advanced economies caused by outsourcing to low-waged economies, an asset bubble, including housing, was allowed to give the masses in the advanced economies capital-gains income to compensate for reduced income from work. The formula was to take jobs from high-paid US workers and give them to low-wage overseas workers, and to compensate US workers with rising prices on their homes, low-price imports and larger return for their pension-fund investments overseas. This formula worked for a while, but it requires an escalating expansion of the money supply to support a debt bubble. The Fed under Greenspan managed to accommodate debt-driven expansion for more than a decade, until the problem reached a point when further expansion of the money supply did not leave money in the US, but went only to the global dollar economy offshore. US corporations are lining up to shed their pension obligations in the name of maintaining global competitiveness. The US housing bubble will burst from insufficient and stagnant income even if mortgage rates should remain low.

>The dollar economy, which benefits primarily the financial sectors in the US and other money-center locations, continues to expand while the non-financial sectors of the US economy collapse.

>The Law of One Price for labor decrees that the Iron Law of Wages will depress marginal wage to the lowest possible level if left to market forces.

>The financial sector has sucked the capital blood from the Main Street workers, replacing jobs and wages with home equity and mortgages. The financial sector has impoverished households and workers, and squeezed the middle class beyond description.

Rook.,.#1419362/24/06; 23:11:18

Well I was mulling the MK post, and kind of wondered how it was fitting in with his gold/macro new system idea.
10 Bears post just brought home the evidence, for me, that the new communism, as Chirac put it, is on the way.
The most powerful point to me in that 10 bears post was the restatement of what we all know. The march and direction of jobs and wages.
It could be the case that it is a combination of factors, necessity, and design.
Necessity in that realpolitic factors drove some hard decisions, and design in that there are some hoped for goals and results that are laid out as targets by design, and the powers that be execute them as they can.
Whatever, a rising tide of unemployed is our future.
The new system we are going to, must be, despite changes in welfare a decade ago, an ever growing welfare state.
Capitalism will flourish those with stock in the mega providers of food and products. The rest of us will take our "associates" pay, and/or our welfare checks, and buy at the mega distribution stores. Hello new dawn.

I dont see much that will change that outcome. And I dont know if it is for the best. A different outcome could come from bird flu and climate change, forceing a return to local economy.
I am undecided about how I vote on this new globalist model. Not that anyone is asking. What I do see that I oppose, is the globalist effort, successfully entrenched effort, to teach worldviews to the kids in schools.
To fight that is just such a huge job. It entails such a huge range of subjects, that although I continue to proceed, I cannot express the range of feelings.

Rook.,.#1419372/24/06; 23:36:04

Is the following the basis of derivitives?

"In finance, the Law of One Price is an economic rule stating that in an efficient market, a security must have a single price, no matter how that security is created. For example, if an option can be created using two different sets of underlying securities, then the total price for each would be the same; otherwise an arbitrage opportunity would exist. Because of the Law of One Price, put-call parity requires that the call option and the replicating portfolio must have the same price.

Interest-rate parity, which plays an important role in the foreign-exchange markets, is another example of the Law of One Price. For the Law of One Price to hold between two economies, purchasing-price parity, exchange-rate parity between the paired currencies and interest-rate parity must all exist simultaneously.

Any violation of the Law of One Price is an arbitrage opportunity. The same should apply to the disaggregated labor markets in the global economy. The issue of unified wages is not only a matter of morality or social justice, as liberals asserted during the Industrial Revolution and the age of imperialism, and as neo-liberals and market fundamentalists reject in the age of globalization and neo-imperialism. It is the law of a truly free global market. While finance arbitrage uses the Law of One Price to raise market value of securities, cross-border wage arbitrage thus far only obstructs the Law of One Price in separate labor markets to keep wages low everywhere.

A common mistake traders make is to forget the caveat that arbitrageable price discrepancy should be isolated from factors such as tax treatment, liquidity or credit risk. Otherwise, they will put on what they perceive to be an arbitrage when in fact there is no violation of the Law of One Price beyond government intervention. The Law of One Price underlies the important financial engineering definition of arbitrage-free pricing even for disparity of prices created by government policy."
Henry Lui

GoldiloxOne-wage law#1419382/25/06; 01:08:03

@ Rook,

Does the one-wage law also suggest a one-housing cost law?

If a Manhattan flat is dectined to cost the same a Bejing flat, some big changes are on the forefront.

The RE market may be in for even bigger shocks than we have imagined.

968Norwegian Bourse Director wants oil bourse - priced in euros#1419392/25/06; 05:44:33

"Andersen in of the opinion that Norwegian oil must be traded in Euros, which can be advantageous for international customers.

"We have performed market studies and both Russia, which is a large oil exporter, as well as the countries of the Middle East have large parts of their economies in Euros. They would be able to view such a bourse as a contribution to balancing their economies in a better manner than at present, where their products are traded solely in dollars," says Andersen."
Randy, (smile), any thoughts ?

GoldiloxIran Oil Bourse#1419402/25/06; 08:40:53

I wonder who actually loses bigger if the IOB is allowed to go forward?

Maybe the Money Masters video is still playing in my head, but I gotta think a lot of the hoopla is about WHO is running the markets - insiders or the "wannabes". An oil bourse selling directly from Iran to Europe leaves a lot of Nymex "middlemen" out of the lucrative contracts.

If a BIS insider were in Iran setting up a Euro-based bourse, would the Euro members be lining up to Condi and Dubya's rhetorical codemnation, or would they be as staunch in their non-support as they were in Iraq?

Although, looking back, no Euro nation did anything to seriously dissuade the Iraq invasion beyond a little jawboning. Given the loss of oil contracts by France and Russia, that was some mighty expensive tongue-wagging.

968@ Goldilox / Iran to grant gas contracts to European firms#1419412/25/06; 10:19:12

I think you know what I mean about the European stance on the IOB...
tejbearMore info on M3, Euro Dollar & Repurchase Agreements#1419422/25/06; 10:19:39

While surfing the Internet for info, I found a neat little piece by gjohnsit titled The Fed plans monetary inflation.


"The second reason why this is important is far more ominous - the Federal Reserve will stop reporting Eurodollars and repurchase agreements.
First of all, Eurodollars are:

Eurodollars are U.S. dollar-denominated deposits at banks outside of the United States. This market evolved in Europe (specifically London), hence the name, but Eurodollars can be held anywhere outside the United States.
The Eurodollar market is relatively free of regulation, and so banks can operate on narrower margins than their counterparts in the United States. As a result, the Eurodollar market has expanded largely as a way of circumventing regulatory costs.

To give some background, there are more Eurodollars out there than there are dollars in circulation in America. To stop counting Eurodollars is to stop counting an enormous percentage of dollar-denominated assets in the world. Hence, the relationship to the M3 monetary supply again….."

"Under a repurchase agreement ("RP" or "repo"), the Fed buys government securities from a dealer who agrees to buy them back, typically within one to seven days; a reverse repo is the opposite.

That sounds relatively harmless until you realize that this means the Federal Reserve, an agency that can print money, is messing with the bond market on a daily basis. And when I say "daily basis", I mean on a steadily increasing basis to the point that they have now become a dominant force in the bond market....."

"At this point it is worth emphasizing that our new Fed Reserve chief to-be has mentioned the idea of buying unlimited amounts of securities from the nation's GSE's. By coincidence the Federal Reserve will no longer report the amount of repurchase agreements just as Fannie Mae is sinking into financial trouble and the housing market is topping.
The coincidences here are far too numorous to ignore. What we are looking at is a calculated plan to print helicopter money to bail out our flawed financial institutions and the mess that Greenspan got us into."

Bear: I feel like I am already a shroom... feed BS & kept in the dark, and now it appears it will get darker...

The Bear

Druid(No Subject)#1419432/25/06; 10:43:14

Druid: Sup with this port thingy? I guess we're a fixin to ship a lot of bullion East bound and good delivery must be verified.
USAGOLD / Centennial Precious Metals, Inc.A world of gold at your fingertips...#1419442/25/06; 13:51:20">gold -- a global calling card
The Invisible HandOne more element of next month's Revolution#1419452/25/06; 16:35:27

Emergency order unsettles press
"But Proclamation 1017, Gloria Arroyo's declaration of a state of emergency on the eve of a march, makes one wonder how threatening that march is..."

Revolution used to a term applicable only to the movements of the bodies in the sky. Maybe, we're going back to that definition.

Topazalt-Gold.#1419462/25/06; 16:59:27

Apart from a little flurry of activity at Options ex/rollover in Jan, PoG has been fairly benign in alts during Feb.
With Comex Ag going to current this week, I'd think PoG might coat-tail Silver in Mar with Ag outperforming ...imho.

The Invisible HandWhere will those petro-EUROS go?#1419472/25/06; 18:10:25

Gulf's four-year oil boom brings $300bn wall of cash to markets
Petrodollars could buy developing world's debt
By Jason Nissé
Published: 26 February 2006

The Gulf states have generated over $300bn (£172bn) in excess cash over the past four years and are likely to generate a similar amount this year.
Where the money is going is hard to tell, as few countries collect data in enough detail or with enough accuracy.

Some still don't get it.
My comment to my previous snip should read: "Revolution used to BE a term ..."

mikalWorld Bank's IFC plans world store#1419482/25/06; 20:34:20

World Bank to Promote World Crafts - Yian Q. Mui - 02/25/06
Washington Post - Excerpt: "The move is the latest in an effort by the bank to bolster its reputation. The World Bank has become a favorite target of protestors who criticize its free-market policies and philosophy of globalization. Pangea is intended to help dispel the notion that "everything in globalization must be bad for poor people", Rosen said."
[Hope none of these crafts end up in dollar stores with a "Made in China" sticker, that is unless its gold. :) ]

GoldiloxLetter from Trader Dan#1419492/25/06; 23:13:11


The more I look at this chart the more I have to marvel at the glue that is holding everything together in the US economy.

It sort of reminds me of watching a duck gliding effortlessly on the surface of a placid lake. Underneath however its little webbed feet are paddling like crazy.

Let's just say that I see the US economy as the duck and this rampant liquidity as the furiously paddling feet that are keeping it moving.

This sharply rising trend shows not the least sign of abating. This week we added another $4.5 billion in liquidity on top of the massive upward spike last week when we saw an increase of $25.7 billion. We are talking $30 Billion in just the last two weeks. Is it any wonder that the yield curve is completely flat?

There is simply no way that they are going to be able to drain this excess from the system without sending things into a tailspin so I guess we keep going up and up and up until one day when we just stop.

Gandalf the WhiteSome MORE things that "meese" does not understand !#1419502/26/06; 11:20:28

Jist happened to be looking in my OLD FILES and found this doc. Please advise me about WHY each of the twelve Fed Reserve Banks has a share of their ASSETS shown as "Gold certificate account" totaling the $11 trillion dollars worth of US Treasury GOLD (valued at that $42.22 rate) ???
AND ---
Is this the same that is shown in the first chart titled
"Condition Statement of Federal Reserve Banks,December 5, 2002
Reserve balances of depository institutions at Week ended ---
showing the line
Gold stock 11,042
WHAT do these things mean -- AND --
ARE things still the SAME ?
SOOOO many questions and so few answers !

Smeagolach, where IS everybody today?#1419512/26/06; 12:56:12

...sss... our (half-guessed and surely insufficient) two cents' worth, Ssir Gandalf to your Quesstion, precious...

The US wanted to borrow money, and no one but a Central Bank would give them credit, sso the Federal Reserve says "What you got for collateral?" and the US says to them, "We have our good name, our past performance, our good credit, and we have (cough) some gold.", to which the Fed-boys ssay, "We'll take the gold as collateral. When the debt is paid, you get your gold back. Deal?", and the US ssays "Done.", and now the Fed owns the gold in trusst at 42 dollars an ounce waiting for payment, the US cannot mark It to market because It isn't theirs, and there's no reason for the Fed-boys to do that, ssince they've probably leased and sold It fifty ways from Sunday ssince the loan was made. Meanwhile everyone thinks (or is allowed to think) the US sstill has It.

Maybe this is why no one has audited It in sso long, eh?

Kind of like auditing the sticks in... an old box of dynamite...


Rook.,.#1419522/26/06; 13:42:55

Goldilox, your idea about one housing price startled me.
It only follows, but still, it did drive home the point that if all that is thier goal, we have quite a road to walk.
I prefer MK's gold based vision I think. It allows for more inequality. It is wierd to say that I prefer the inequality, but doesnt that allow more freedom? Hard for me to grasp.

USAGOLD / Centennial Precious Metals, Inc.SECOND EDITION -- Written for Today's Market!#1419532/26/06; 14:36:32">Gold Investing - Second Edition
mikalRetiring debt, raising ratings#1419542/26/06; 14:50:01

Brady Bonds Shrinking Fast - Joanna Chung - 02/26/06
New trend in emerging markets reflects several changes in attitudes toward debt and regional risk and greater market liquidity.

geSmeagol#1419552/26/06; 15:48:49

Waiting for the Iranian Oil Bourse to open. Waiting for the US response to it.
GoldendomeOne Goldbugs struggle with Silver.#1419562/26/06; 16:03:22

Looking back on the problem, I can laugh about it. But at the time, it was a "painful" experience! Musings of a goldbug on a slow, cold, February Sunday.

A problem with silver is the weight of the stuff one needs to accumulate, for the dollars put into it. Admittedly, the markets now through higher prices are working to remedy this situation for us. Goldendome, confronted the weight problem, the last time he visited his bank to add to and to gaze at, what was stored in the safe deposit box. He figured that in that box was contained about 1100 ounces of silver and other stuff. Perhaps a problem in figuring precious metals weight is the way we calculate weights. An avoirdupois pound (hamburger for example) is 16 ounces, while a troy pound, for precious metals, is 12 ounces. I don't know whether one pound is one pound in comparison, but I figured there was about 70 pounds of silver in the box (avoirdupois weight), but when I attempted to slide it out—I think over 90 pounds was in fact there, in troy pounds.

Goldendome is no weight lifter. His aging and softening physique have weakened since the last time he hoisted the box back into its resting position-- about chin high in the vault--or, his technique had deterioated. Whichever the case, as the box slid out this time, he quickly found that his forward-extended arm was too near the middle of the box and not close-enough to the far end to support its weight. The away end of the box tipped downward; the contents slightly shifting forward in the box, compounding Goldendomes inability to hold it steady. The whole thing went crashing to the floor, nearly tearing off one of Goldendomes thumbs in the process.

As he knelt there on the floor cradling his freaking thumb that felt like it was broken, the cute little brunette that mans the desk closest the vault and keeps the second key-- who had checked Goldendome into the vault area, came running through the door. "Are you ok? She asked with concern. "Yes," he replied, attempting to hide his pain and embarrassment. "The box slipped out of my hands."

Then her eyes shifted to the contents, some of which had spilled onto the floor as the lid had come partially ajar. "What is that?" She asked, nodding in the direction of some of the spilled items.
"Just some silver." He said, while beginning to pick up some lose items.
Honest to god, she then replied, "Oh, I've never seen any of that."
Goldendome lied. "Well, it's basically what you've got out there in the drawers."

After again, making certain that he was ok, she left Goldendome with his troubles. He managed to muscle up the box onto a shelf there in the vault. It too, sagged under the weight, but fortunately, held up. There Goldendome arranged the contents of the box once again and finally mustering his strength-- lifted the box back into its holding compartment. But again, something was wrong. The fall had distorted the shape of the top of the box! As he wrestled to reinstall the box in the holding compartment, he fought to square its top-- Finally, the thin metal was coerced back into proper shape and the box finally slid home into it's position. Standing there in the vault exhausted—thumb throbbing, Goldendome said to himself, "What the hell? I damn near have a catastrophe right here in the bank vault. Jesus!"

When leaving the vault to exit the bank, Goldendome thanked the cute brunette for her assistance and concern. He also made a pledge to himself, that the next time he returns to the bank it will be with his young much stronger son, to probably, empty the box, once and for all.

SmeagolYess, Ssir ge....#1419572/26/06; 16:11:16

...we feel it too... waiting for some sstroke of doom or fate.


Gonlyoldtest msg#1419582/26/06; 19:27:35

Let's see if I remember my password.
GonlyoldMy Original Stratigy#1419592/26/06; 19:48:40

Some of you may recall my original stratigy of buying and selling within the 420 to 460 pog range: I noticed that TPTB seemed to "regulate" the POG within there. Well I got busy and missed the 460 level. Didn't catch the POG until it hit some 470 or such. Anyway, it was decision time: sell or keep my gold Eagle. Well I decided to hold it. Was getting some gut feelings about gold going higher. Greed????? Don't know. But I kept it.

Then at about 500, I bought another eagle. Got taken advantage of with this purchase as the coin dealer charged me TAX! There's a first for me: mark-up plus tax. Do I get to sell it and charge tax? Doubt it. Won't go back there. But what does charging tax mean? Hmmmmm.... Aparently this is not considered a money exchange.

Putting that aside, the next issue is what do I think TPTB are doing now. I still think that they're not out of the picture. Is my original stratigy still valid but at an elevated range, say 540 to 620? Not sure. March 20 looms in the near future (Iran going to Euros for oil). Think I'll hold 'em and not fold 'em for now.

Clink!@ Goldendome#1419602/26/06; 20:00:43

A cautionary tale indeed ! Funnily enough, I have just been using that very same property of silver that gave you the problem - its density - to good effect. I have a couple of tubs of junk half dollars which are just light enough for me to lift and carry, but make excellent weights for work I am doing on my hardwood flooring. Now that's not something that many goldbugs can say of their yellow metal !

ToolieMonty Python and current events#1419612/26/06; 20:11:02

Is it a mark of how absurd that the world is becoming, that I see soooo may similarities between Monty Python sketches and current events?

The Danish cartoons and Iranian response of having a contest for holocaust cartoons bring to mind the sketch where Englan