USAGOLD Gold Discussion Forum Archive

Electronic reproduction sourced from
contrarianAll the Talk About IMF Changes--A Little Premature?#1516942/1/07; 00:23:47

Seems to be a case of counting your chickens before they're hatched as per below! Or a case of "he said, she said".

"IMF Has Not Adopted Accounting Changes to Gold Loans

By Jon A. Nones
25 Jan 2007 at 04:06 PM EST

St. LOUIS ( -- Earlier this week Blanchard & Co., a New Orleans-based bullion and coin dealer, released a press statement saying the International Monetary Fund (IMF) has adopted a number of accounting changes to the lending of gold reserves by central banks, and will begin implementing those changes in the coming year. IMF told Resource Investor today otherwise.

In response to press queries about a January 22 press release from Blanchard, claiming the IMF made accounting changes for recording gold loans, IMF spokeswoman Conny Lotze sent the following statement to RI:

'At this time the IMF has not adopted any new accounting changes for the recording of gold loans. A review is taking place in the context of the update of the fifth edition of the IMF's Balance of Payments Manual and has involved experts from the Fund, other international agencies, and a number of member countries,' said Lotze.

The IMF's Balance of Payments Manual governs the accounting and reporting functions of central banks through a set of rules and regulations. The manual regulates how reporting should be handled across a large spectrum of issues, which includes gold swaps and loans.

Blanchard's statement was a follow-up to a paper by the company published on December 14, 2006, entitled "Gold Market Lending," which prompted a debate with Kitco's Jon Nadler. Within the paper, Blanchard's Director of Economic Research Neal Ryan alleged that unaccounted amounts of gold loaned into the market had a direct impact on the price.

He said the IMF had been reviewing all aspects of their Balance of Payments Manual so that proper updates to the Manual can be implemented in the near future. This week's statement by Blanchard said that the IMF had indeed made the decision to go ahead with changes to the way central banks account for gold loaned in the market.

Blanchard Chairman and CEO Donald W. Doyle, Jr. said the newly adopted accounting change means that central banks will no longer include the amount of gold they have loaned and sold into the market as part of their reserve total assets.

He added, 'this decision by the IMF will greatly redress that issue as these accounting changes are implemented.'

However, Lotze said there has not been any decision made and papers on this and other issues are "being addressed" and have been posted on the Fund's external website.

'We anticipate posting a draft version of the whole Manual for world-wide comment within the next two months,' said Lotze.

Ryan told RI today that the public stance by the IMF press officer is in direct contrast to what was posted by the Reserve Asset Committee (RESTEG) as a concluded issue for them from their October meeting in Frankfurt, Germany.

'I have been told directly by members of the Reserve Asset team that the only issues left are to decide how to implement the change and allow public comment.'

Within the meeting notes of the 'Nineteenth Meeting of the IMF Committee on Balance of Payments Statistics,' Ryan pointed to a list of concluded issues beginning on page 4, where on page 7, No. 27, it reads: 'In this treatment, unallocated gold accounts held with residents (such as bullion banks) are excluded from reserve assets.'

'As you can see in the paper, the issues on changes to gold lending as far as the IMF RESTEG Committee is concerned is a concluded issue,' he said.

But according to the IMF, consultations are still on-going and this is just a summary of outcomes. On page 19 of the document, the IMF states:

'There was a clear majority in favor of maintaining the current treatment of monetary gold. Further consultation with Committee members is needed on unallocated gold accounts held by monetary authorities (paragraph 27 of the paper). This issue will involve further consultation with Committee members.'

But Ryan said the committee has made its conclusions and is continuing to work on how to implement, not if to implement.

'This is where I think the disconnect exists with the press officer and the committee,' he said.

IMF has laid out many of the issues on gold loans and gold deposits prepared for the technical expert group on reserves in a paper, entitled "Treatment of Allocated/Unallocated Gold Held as Reserve Assets and Gold Swaps and Gold Deposits."

The latest full-scale review of the manual began in 2005 and is scheduled for full implementation in 2008."

GoldiloxMexicans stage tortilla protest#1516952/1/07; 01:06:48


Tens of thousands of people have marched through Mexico City in a protest against the rising price of tortillas.
The price of the flat corn bread, the main source of calories for many poor Mexicans, recently rose by over 400%.

President Felipe Calderon has said the government will clamp down on hoarding and speculation to ease the problem.

But some blame the rise on demand for corn to make environmentally-friendly biofuels in the United States.

Agreement ignored

The BBC's Duncan Kennedy in Mexico City says the protest was noisy, passionate and angry.

The recent tortilla price rises have been the worst in decades, sparking fears that some could face malnourishment.

For many of Mexico's poorest people the tortilla is a staple of their diet, with as much as a third of their wages being spent on the bread.

Mr Calderon has ordered his agriculture secretary to import corn to try to ease the problem.

And earlier this month he signed a pact with a number of business groups that they would cap the price of tortillas at 8.5 pesos (77 US cents) per kilogram, but many have chosen to ignore the agreement, which is not legally binding.

Under the 1994 North American Free Trade Agreement, Mexico used to get cheap corn imports from the US, but Mexico's Economy Minister Eduardo Sojo has said that with more US corn being diverted into ethanol production, supply is dwindling.


Looks like corn is also a "finite resource". Whodathunkit?

Next we'll see rising whiskey prices. That won't make for happy campers!

968Russia buys gold for reserves#1516962/1/07; 02:13:34

Between the end of August and the end of November Russia, according to the I.M.F., increased its ‘Official’ holdings of gold by 9.2 tonnes, which...

... averaged a cautious 1 tonne a week.

For them to reach the targets implied by government officials as high as President Putin wanted at 10% of reserves, they will have to increase the pace of these purchases dramatically. With oil exports roaring along with the higher oil price and Russian reserves burgeoning, a gold price rise cannot, at this stage, be expected to rise fast enough to make this figure a reality all by itself. Much heavier purchases need to be made.
Thoughts anyone ?

mikalWorlds apart#1516972/1/07; 06:20:08

ANALYSIS - Paper gold may face long haul to success in India|Reuters | February 1, 2007
968Putin considers gas OPEC an interesting idea#1516982/1/07; 06:34:53

MOSCOW. Feb 1 (Interfax) - Russian President Vladimir Putin considers the setting up of a gas OPEC to be an interesting idea and promises to think about it.

"A gas OPEC is an interesting idea, we will think about it," Putin said at a press conference on Thursday.

He said that Russia is trying to coordinate its actions on fuel consumption markets with other production countries.

"We are in agreement with Iranian specialists, Iranian partners, with some other countries that produce and supply a lot of hydrocarbons to the world market - we are already trying to coordinate our actions on markets in third countries and plan to continue to do this in the future," he said.

Putin said that Russia is not planning "to set up some sort of cartel, but it would be correct to coordinate activities."

"The main task is the unconditional and reliable supply of fuel," he said.
WOW, heavy stuff !!! A NLG-cartel with 'axis of evil'-partner Iran.

mikalSlash VAT on physical buys- WGC#1516992/1/07; 07:05:37 World Gold Council Urges China to Cut Tax to Boost Gold Trading by Helen Yuan - Bloomberg - February 1
Henri@TC RE:Paulson's quip#1517002/1/07; 07:55:58

"Increased flexibility in the short run is absolutely necessary, but it is not sufficient," Paulson said, "My goal is to make significant progress toward a fully market-determined, floating Chinese currency."

My immediate interpretation of this is...

Our goal is to lure the Yuan into the kind of open environment where we can can affect its value to our advantage at will as we do the other currencies by chaining it to massive derivative plays and other manipulative practices. Our goal is to sink the Yuan as we have our own currency...for profit.

TownCriermikal, a noteworthy excerpt from your link...#1517012/1/07; 07:58:49

"We see a huge demand potential given the Chinese people's large bank deposits", valued at about $2 trillion, Cheng said...

The London-based World Gold Council plans to launch gold exchange-traded funds, enabling investors to trade without taking physical delivery, in India, Italy, Germany, Belgium and the Netherlands, Chief Executive James Burton said Jan. 12.
The Council's strategy in China is to boost physical transactions among individuals, rather than introduce the securities, Cheng said.

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

Is the marketing difference (ETF vs. physical) because one doesn't dare risk promoting a scheme (like poking a hornet's nest) that could eventually leave over 1.3 billion people holding a dodgy paper bag?


TownCrierA question for our European friends...#1517022/1/07; 08:15:50

Please enjoy a view of the two euro charts at the page bottom (see link).

With the euro-denominated price of gold now pressing nicely above 500, we're basically in new territory (except for the spike in May 2006).

Is it your intuition that the EUR500 pricetag will attract public notice or in any other way prove to be psychologically signficant to potential investors over there in Euroland?


NedBreaking out of the trading range !!!#1517032/1/07; 08:19:47

mikal@TC#1517042/1/07; 08:20:05

Good point. Even in the "People's" Republic, people will still be people.
mikal"Roaring Twenties" revisited#1517052/1/07; 08:36:43

Personal Savings Drop New Low - FMNN - Associated Press
Cometosethe miner's having a hard time digesting and synthesizing this move in the metal #1517062/1/07; 09:27:14

Is someone manipulating the miner's " disbelief" ...too bad because the dollar tells the story ......

It apparently has begun its decsent or is that descent ...

and the hui will be playing catchup soon ......i would imagine

BelgianGoldprice in euro > 505 €#1517072/1/07; 09:30:46

No Sir TC. Euroland's investing general public attention is not at all alarmed (attracted) by the recent €-goldprice rise. With the exception of the hard core of gold-loyalists (smile). These people continue to accumulate the precious.

The general public only moves when the goldprice behavior becomes spectacular and the media report about it on their frontpages.

But,...there is indeed some remarquable news : Banks, now sell the precious at spotprice and skip their 1% profit !

Maybe because WGC wants to introduce (promote) gold-paper products (ETF) in Euroland ...and banks are anticipating this ???

Cometosedollar chart#1517082/1/07; 09:31:31$usd,uu[w,a]daclyyay[pb50!b200][vc60][iup5,3,3!la12,26,9]

Oil after getting bopped is also recovering some .....
Looks like OLe man winter has arrived in the NE

Cometosedollar#1517092/1/07; 09:36:25$USD&p=D&b=3&g=0&id=p61546981074

sorry blip
Flatliner@Belgian#1517102/1/07; 09:59:12

Hi Belgian, Can you explain your thinking with regards to the ETF anticipation and giving up 1% profit? And, I am curious what your thoughts are with regards to the "Digital gold and a flawed global order" article posted on the CFR site and if you think it might be connected to what you notice?
mikalPassing the buck#1517112/1/07; 12:39:52

Derivatives bring drama to Davos By Gillian Tett
Published: February 1 2007 02:00 | Last updated: February 1 2007 02:00 | Excerpts: "...Nevertheless, the focus on structured products does mark something of a departure for the Davos group, given that these issues have generally been ignored in previous years. The public and private meetings re-vealed sharp disagreement about three key points.
The first is whether regulators needed to worry about the fact that the structured finance and derivatives world is often opaque, particularly given the dominant role of unregulated hedge funds...

Howard Davies, former head of the Financial Services Authority and now an academic, said: "We all know that the reality of the financial markets is that risk is being parcelled up and paced around. But international regulatory architecture is still organised as if the world had not changed. As a result, we have a regulatory architecture designed for a bygone age.""
Mikal- They're passing gas, passing the buck(shifting blame). But very little time is left to pass before TSHTF.

Federal_ReservesJob loss in US goes to India?#1517122/1/07; 13:25:27

US January Planned Layoffs Rise 15 % From Dec

Announced layoffs rose 15 percent to 62,975 jobs in Jan. from 54,643 in Dec., according to Challenger, Gray & Christmas.


IBM Headcount In India Tops 50,000

If the current growth rate continues, IBM will have more than 70,000 workers in India in 2007.

MKSign-up for the latest USAGOLD NewsGroup. . .#1517152/1/07; 14:23:27

What does the yen carry trade have to do with gold? Why do we believe it is the "funds" that are driving this market?

To find out, we invite you to join us as a member of the USAGOLD NewsGroup. We sort through the avalanche of gold related news to find the stories we believe most pertinent to gold-owners at any given point in time. We then rate the articles on a five star basis, and apply our many years knowledge and experience to an interpretation. If you would like to stay on top the gold market, this will help you do it.

It's informative.
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GOLD FINGERPersonal savings drop to a 73-year low#1517182/1/07; 16:56:09


To bad more people are not willing to invest in gold. Maybe then they would be less tempted to use up their home equity as a back up to float their extravagant life styles. Looks like keeping up with the "Jones's" has America going full throttle.

Gold....the uncommon valentines gift...or is it?? :-)


USAGOLD Daily Market ReportPage Update!#1517192/1/07; 17:48:03">
The Daily Gold Market Report has been updated.

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THURSDAY Market Excerpts

February 1 (MarketWatch) -- Gold futures closed Thursday at their highest level since August, extending their winning streak to three sessions as recent strength in oil prices and a slight dip in the value of the dollar helped lift prices past $660 during the session.

Indeed, "there appears to be enough thrust behind this move to take us to and beyond $700 over the next few weeks, months," said Peter Spina, chief investment strategist at

"The market is readjusting itself based off strong fundamental factors and with rising energy prices and a weakening dollar, this just accelerates the process," he said.

April gold futures closed up $5.10 to $663 after a high of $667, the contract's strongest intraday level since Aug. 9.

"As expected, gold has broken above key resistance at $650 and now appears to be making a beeline toward $700," said Peter Grandich, editor of the Grandich Letter.

He predicted it could see that price level before the end of the first quarter.

At the same time, "there is no denying the underlying strength gold is seeing here," said Spina, pointing out that even when energy prices drop and the dollar strengthens, gold's been holding up.

"It is difficult to deny that gold is trading more independent of prior-market correlations," he said. "The metal is in demand and accumulation is driving it back to its 2006 peak."

That gold prices climbed past $650 "in the face of reported talks to sell some IMF gold holdings is yet another indicator of how strong gold really is," said Grandich.

On Wednesday, the International Monetary Fund proposed the sale of about 400 metric tons of gold to help fund its activities. Futures prices for gold had ended Wednesday's regular trading session nearly $8 higher.

"Having pushed on through the resistance we noted at or near the $650/ounce level, we have added to our outright long positions," said Dennis Gartman, editor of The Gartman Letter early Thursday.

"We remain long of gold also relative to crude oil, and despite the massive rally in U.S. equities yesterday, we remain long of gold relative to stocks."

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

mikal(No Subject)#1517202/1/07; 18:25:49,,2003100,00.html

Derivatives: the risk factor is frightening
Nils Pratley - The Guardian - Thursday February 1, 2007
Now would be a bad moment for financial markets to have an accident, said the Financial Services Authority yesterday. The shock to the system would be "much greater now than two or three years ago". Regulators are paid to be cautious, so at one level this pronouncement is unsurprising, but "two or three years" is not long ago. Can things really have changed so much?
Well, yes, in spades. The biggest change is the growth of credit derivatives, the process by which securities such as corporate debt, mortgages and shares are sliced, diced, packaged and repackaged. Investment banks house too much creative computing power these days, and the face value of credit derivative contracts is reckoned to be about $30 trillion - yes, trillion. It's an enormous number and about eight times as much as in 2003. So something very big has changed very significantly.
Reading between the lines, the FSA seems to be admitting that it has inadequate insight into this world of "increasingly complex financial markets." Again, that is not a surprise because credit derivatives are the domain of the trading desks of investment banks and specialist hedge funds.
Nor is the FSA alone. Jean-Claude Trichet, president of the European Central Bank, said last week that "there is now such creativity of new and very sophisticated financial instruments ... that we don't know fully where the risks are located. We are trying to understand what is going on but it is a big, big challenge."
Trichet sounded like a man witnessing an accident but unable to do anything, which hasn't always been the attitude of central bankers towards derivatives. Many used to argue that these instruments do important work in spreading risk and reducing the cost of borrowing.
Now, though, there seems to be a change of tone. Timothy Geithner, the US Federal Reserve's man in New York, said last year that the derivatives revolution may make financial crises less common, but more severe when they do occur. You may not be reassured.

FlaccusMikal/$30trillion in derivatives#1517212/1/07; 18:46:37

As John Law once said -- "How was I supposed to know this was going to be a problem."
GoldiloxProblem?#1517222/1/07; 22:50:54

@ Flaccus,

"Problem, who has a problem?

Pass the cake, please."

Chris PowellCongressional investigators to report on credit derivatives#1517232/1/07; 22:54:41

From Reuters
Thursday, February 1, 2007

WASHINGTON -- Investigators for the U.S. Congress on Thursday pledged to issue a report by June 27 on the use of information technology in the credit derivatives market, responding to a request from lawmakers concerned about trade confirmation backlogs and economic stability.

Serious problems with information infrastructure could "trigger financial calamities with repercussions for the whole economy," Michigan Democratic Rep. John Dingell said in a statement.

Dingell, who is chairman of the House Energy and Commerce Committee, and a half-dozen other lawmakers requested the report from the Government Accountability Office.

The credit derivatives market includes contracts such as credit default swaps that are reached between institutions to manage credit risk.

The credit derivatives market grew 52 percent in the first six months of 2006 to $26 trillion, according to the International Swaps and Derivatives Association.

On Wednesday, Britain's Financial Services Authority (FSA) said the volume of outstanding trade confirmations in the equity derivatives markets has grown in the past year, resulting in a significant backlog.

The FSA urged firms to address the problem, while praising the credit derivatives market for largely resolving operational backlogs, which in the past two years drew regulator warnings.

The Federal Reserve Bank of New York said in late September that U.S. credit derivative dealers have doubled the number of trades processed electronically and sharply reduced backlogs.

The New York Fed has held meetings on the matter with major dealers, including Bank of America, Bear Stearns, Citigroup, Deutsche Bank, Goldman Sachs, Merrill Lynch, and others.

TopazThe order in which Currencies will capitulate to PoG.#1517242/2/07; 00:17:48

As we patiently await someone (ANYONE!) to come along and buy a Bond so PoG can move on up, it might be worth guessing which Currencies ...or in which order, PoG will rally above their recent multi-year highs.

I'll go first: - Japan (that ones easy), Canada (um! maybe tonight) it gets a bit trickier, Swissie, Euro, Dollar, Aussie and lastly Pound.

All done well and truly by next Fri!

BelgianRe-Flatliner msg#151710#1517252/2/07; 01:31:45

I do remember that at a given period, Belgium introduced (briefly) 1% VAT on bullion and stopped it very rapidly because Luxemburg immediately got all the gold-trade (taxfree). Belgian Eurolanders do buy their goldmetal directly from their banks and never bothered about the 1% bankprofit on top of the spotprice. Simply because the main gold-dealer for Belgium (who provides the goldmetal to all banks) is located in Brussels.

Point is : Who is giving those directives about gold VAT tax and 1% bankprofit margin...and WHY the sudden changes ?

Belgian (conservative) savers still want the goldmetal when they finally decide to protect their portfolios loaded with digits/papers. Our gold-governors most probably want it to keep it this way, for obvious reasons and want to avoid that these conservative savers are "lured" into (WGC) digital gold...without excluding the possibility to do so, if desired.

Belgian banks stopped selling silver (21% VAT) long ago.
Who ordered them to stop it and why !?

WHY do Belgian banks bother to deliver (keep on delivering) gold-bullion WITHOUT even that tiny 1% profit margin ???

My interpretation of this descision is the wide "opening" of the euro goldmetal gate...for the many good reasons we discovered here at CPM since 1999.

Yes, 1% is a miniscule step and therefore so principally a (surprising) change in (freegold) policy.
Free competition with soon to be introduced digital gold. As if the fysical gold-trade (wealth saving) should not be abandoned whilst goldmetal and paper-gold pricing are not yet explicitely separated (severed link).

I conclude seeing this miniscule step as a tremendous positive indication in the process towards euro-freegold.

mikal(No Subject)#1517262/2/07; 08:25:58,,9063-2580931,00.html,,9063-2580931,00.html Debt crisis as 100,000 declared insolvent - Industry sectors - Times Online - Steve Hawkes | 02-02-07
Cometosewinter#1517272/2/07; 08:45:28

Idon't remember a winter like this ; I was commenting the other day about our neighborhood ; most of this usuallly is confined to Gunnison where I have wintered briefly before; also I sated to a client that this weather is reserved mostly for the area of the twin cities area in the plains......

a map is included the front is heading toward the east coast and the winter is liable to be a humdinger as some weather analyst stated yesterday

Oil prices moving higher on demand ........reason enough to stagger the sypmathetic move coming the metals with a slap down today

It's 4 degrees in Carbondale as we speak .......

hope it warms up soon ....

No matter the weather be ready in season and out of season
with TRUTH and GOLD

If this happens again next year , i would say that we might be in trouble

TitanCan't let gold stay above $650 for long, can they!#1517282/2/07; 09:21:23

The last couple of days looked really promising. Gold went over $650 and actually STAYED there more than a day. But now today they've managed to stomp it back down to where they think it belongs. Gotta love the central banks! :-(
Goldilox"Spank Gold, it's Friday" - SGIF#1517292/2/07; 09:31:06

@ Titan,

I've gotten so used to the predictable Friday gold attacks that I have a name for them. No doubt the B(L)S fantasy employment numbers will get the credit for igniting the US $ on its "E-ticket ride".

If PoG creeps back to near $650 by COB today, next week might just floor some folks. The short sellers can mainpulate PoG pretty well, but they usually do not stand in front of a moving train.

mikal(No Subject)#1517302/2/07; 09:33:44 Top Treasury Official Resigns | Washington Wire |
Elizabeth Price | February 2, 2007
IMF "accomplishments", talk of "turf battles" and no word yet on the successor.

TownCrierHey... this $10 price drop feels like some sort of highly advanced physics#1517312/2/07; 09:36:49

That is to say, it's like stepping back in time two days -- to enjoy Wednesday's prices again.

(Two days, hmmmmm.... I wonder if this means I didn't really need to shave today...)


Toolietest#1517322/2/07; 09:38:51

ToolieTrans-Atlantic Trade War!#1517332/2/07; 09:41:23

Ok that's overstating it a little bit, just rumblings so far.

Can't seem to post a snip for some reason...
Here is the headline.

France Tells U.S. to Sign Climate Pacts or Face Tax.

As the dollar teeters under pressure from its trade and budget deficits, it's economy stripped productive capacity. France paves the way for a stronger Euro. By applying tariffs under the guise of a "carbon tax" the Euro gains latitude to strengthen further while protecting its industrial base. Putting further pressure on holders of US debt. Some in the Middle East have already been grumbling that while most of their trade is conducted with Europe, their oil is sold for dollars. Add the European carbon tax to that and it makes matters worse, not to mention what it does to the US airplane er... export sector.

SurvivorOverheard . . .#1517342/2/07; 10:06:48

On the tube this morning I half-heard a talking head mention a gold hedge fund that is in trouble and putting downward pressure on PoG.

Has anyone else heard this?

Have a golden Friday!

- Survivor

TopazTodays little abberation,#1517352/2/07; 10:56:59

will be seen as an annoying gnat bite in an otherwise totally enjoyable stroll in the park once the cross-over trend resumes next week.

IMO of course!

Flatliner@Belgian (and others)#1517362/2/07; 11:07:45

I am wondering specifically about your statement, which seems more of a conclusion than anything else, "Free competition with soon to be introduced digital gold." It seems that the dropping of the 1% VAT would translate the "Free" part literally, so as to make physical gold purchases even with anything that is based on spot in your neck-of-the-woods. The real question that I have stems from the idea that there is some ‘competition’ pending between physical gold and a coming digital gold.

Thus, I would like to understand this ‘digital gold’ idea just a little better so as to see how it might actually compete and if it can actually compete (and the details therein).

It's my understanding that digital gold is a financial widget exactly like what is stated at GoldMoney's website "GoldMoney is like online banking, but your account is denominated in goldgrams and mils, not dollars and cents. Each GoldMoney goldgram® you own is safely stored for you in allocated storage in a specialised bullion vault near London, England, and is insured through a policy underwritten at Lloyd's of London. When you buy goldgrams, you own pure gold in a secure vault." Effectively, what they are trying to sell is a 100% gold backed currency system. Rather than issuing receipts (paper currency), they issue a digital balance and rely on a plastic card (or computer access) as a means for exchange. The other thing to notice here is that when you convert into this particular type of currency, the bank (in this case GoldMoney) claims to have 100% backing.

But we all know that not all bankers work this way. Bankers always try to go fractional with their reserves in order to maximize profit by gambling that only a fraction of the reserves will be withdrawn at any one time. With this in mind, it would lead me to believe that if there were a move (in the dollar controlled world) towards digital gold, there would be a strong move towards not allowing access to the reserve in order for the bankers to maximize their profits. We might expect the system to be backed by all that yellow hiding out in Fort Knox or other locations that are not regularly audited and that it, too, would be insured by the most credible of sources. The question is, will this type of system work towards honest trade or away from honest trade? I lean towards ‘away from’ and towards confiscation to kick start the system.

The actions of the banks in Brussels or Luxembourg committing to the honest flow of physical seems to take a completely different stand towards the function of gold in the economy. One might read their stand as – if gold is used as a reserve, there must be a clear understanding of its physical demand. In other words, gold must trade in the economy and be present in the economy. The key difference here is that it must remain in the economy.

Does anyone else see this? Specifically, a move towards a digital gold currency system may be a move further away from open gold trade in the economy and one where rules can be formed, in the name of the system, to provide more limits to physical trading.

Anyone interested in sharing their options about ‘digital gold’ will find me most willing to read.

Toolie@ Survivor#1517372/2/07; 11:33:48

Snip: Red Kite to extend redemption notice period
High-flying, $1 bln metals trading hedge fund lost as much as 15% in January (end snip)

mikalSpecs, the dollar, miraculous good jobs surge, etc#1517382/2/07; 11:50:24

Gold tumbles on Iran news
U.S. says it has no plans to go to war with Iran, technical selling send futures lower.
February 2 2007: 11:48 AM EST

NEW YORK (Reuters) -- Gold futures fell nearly 2 percent in New York Friday, a day after they hit a 5-1/2-month high, hurt by a jump in the dollar and news that the United States had no plans to go to war with Iran.

Most-active gold for April delivery on the COMEX division of the New York Mercantile Exchange sank $10.60, or 1.6 percent, at $652.40 an ounce, trading between $655.30 and $665.30 an ounce.
Gold futures hit a low of $650 after U.S. Defense Secretary Robert Gates told reporters that "we are not planning a war with Iran."
Gold prices usually rise with geopolitical tensions because of the precious metal's safe-haven appeal.

'Terror-free' oil makes U.S. debut
Leonard Kaplan, president of Prospector Asset Management, said that a technical sell-off, primarily by funds, was triggered once the April contract fell below $660 an ounce.
One futures commission merchant attributed gold's strength Thursday to a technical breakout and added that it was important to climb above the $660 an ounce level.
"But this kind of reversal that we're looking at right now certainly appears like it may have been reversed," he said.
He added that the reverse in the dollar's strength was one of the reasons why gold and silver fell early Friday. The dollar rose in a technical rebound. The euro fell against the dollar, trading below the psychologically important $1.3000 level.

The U.S. Commerce Department said that the economy added a weaker-than-expected 111,000 jobs in January, and the unemployment rate rose to 4.6 percent for the month, the highest since a matching rate in September of last year.
George Gero, vice president at RBC Capital Markets Global Futures, described the job data as "anti-inflationary." Gero also said that Friday's selling was related to profit taking before the weekend.

Thursday, gold futures hit their loftiest level since August, and they have also finished higher for the last three consecutive sessions before Friday's decline.

mikalTechnology and cyberstructure#1517392/2/07; 12:47:11

Time change: Y2K all over again?
By Charles Babington
The Washington Post - Friday, February 2, 2007
WASHINGTON — It seemed so simple and familiar: Spring forward, fall back. For 20 years, that's what Americans — and their technology — have done with their clocks on the first Sunday in April and the last Sunday in October.
No longer. When few people were paying attention in August 2005, Congress lengthened daylight-saving time by four weeks in the name of energy efficiency. The change starts this year — on March 11 — and it has angered airlines, delighted candy makers, and sent thousands of technicians scrambling to make sure countless automated systems switch their clocks at the right moment.

Unless changed by one method or another, many systems will remain programmed to read the calendar and start daylight-saving time on its old Sunday start date in April, not its new one in March.
It's one thing to arrive an hour late for church on the first day of daylight saving. It's another for a security system to log the wrong time of crucial events, for pilots to misunderstand their takeoff times or international communications components to stop synchronizing. But such scenarios are possible without the fix to vast numbers of the nation's technical systems.

As IBM notes on its Web site: "Any time-sensitive functions could be impacted by this change. ... It is important for users to assess their environments and develop appropriate plans for applying the necessary changes."

The challenge carries faint echoes of the Y2K scare, when governments and corporations feared computer systems would go berserk the instant 1999 flipped to 2000. But it has received nothing near the same level of attention. Indeed, large swaths of America seem oblivious to the approaching change, according to analysts and technicians who track Web sites and swap information with colleagues nationwide.

"After building bunkers in the desert for Y2K, we're not even talking about this, and it's happening in less than two months," said Matthew Kozak, an information-technology specialist at Rutgers University.
Even in the banking industry, where ATMs time-stamp every customer transaction, awareness of the March 11 change is limited.

"I haven't heard about it," said Barry Koling, spokesman for Atlanta-based SunTrust Banks. "It seems to me, we managed to get through Y2K. If we can accomplish the change of the millennium, we can handle a change in daylight-saving time."

Warning from Microsoft

For many widely used devices, automatic updates should prove easy. Cellphones should flash the correct date and time because they receive such information directly from service providers' networks. Similarly, the Internet will automatically update clocks on many personal computers that use relatively up-to-date software.

But Microsoft cautions that some older products — including Windows XP SP1 and Windows NT4 — will require manual updates. The company's Web site provides detailed instructions on how to update various products, although it is pushing against the deadline in some cases. Updates and tools "are being developed and tested," the Web site says, and some will "be released through early March 2007."

As a fallback, Microsoft urges customers to double-check meetings scheduled during the four weeks being added to daylight-saving time this year.

Similarly, network equipment maker Cisco Systems "has undertaken a companywide initiative to supply documentation that describes how to update each product," the firm said in a recent online notice. "Customers should contact any vendor that uses time-sensitive messaging or other time-stamped communications in order to determine the impact."

The congressional debate over expanding daylight-saving time barely caused a ripple in spring and summer 2005. It was in a wide-ranging energy bill better known for granting tax breaks to oil and gas companies.
Advocates said the nation could save about 100,000 barrels of oil a day by extending daylight-saving time, pushing more human activity into sunlight hours and reducing the use of light bulbs. So lawmakers agreed to start daylight-saving time three weeks earlier and end it a week later, the first Sunday in November.

Some airlines fought the change, saying it would cost millions of dollars to change domestic schedules to match landing and takeoff slots at international airports. But President Bush signed the measure in August 2005, and the matter seemed to hibernate until corporate and government officials began realizing what the March 11 onset might entail.

Changes, resistance

If the change is prompting confusion and consternation, it's in keeping with daylight-saving time's history. First proposed by Benjamin Franklin, it was briefly adopted by Congress during World War I. In 1966, Congress set daylight-saving time to begin in April and end in October but temporarily extended the period during the mid-1970s energy crisis.

In 1986, Congress set daylight-saving to start at 2 a.m. on the first Sunday in April and to end the last Sunday in October.
After resisting for years, Indiana adopted daylight-saving time last year. But Hawaii does not recognize it, nor does Arizona, except on its large Navajo reservation.

Candy manufacturers lobbied for years to stretch daylight-saving time to encompass Halloween. Not only will children in some time zones have more daylight hours to consume treats, they contend, but they will be safer zipping across streets in their costumes.
And if Nov. 1 seems unusually dark and cold when the first school bell rings, perhaps they can warm themselves with thoughts of unused barrels of oil.

mikalTasteful topping leaves little for tip#1517402/2/07; 13:04:30

Talk about rich! Gold-dusted brownie costs $1,000
Associated Press | Feb. 2, 2007 08:11 AM
ATLANTIC CITY, N.J. - For $1,000 in Monopoly, you can buy Boardwalk and Park Place and still have $250 left over. In the real Atlantic City, here's what $1,000 will get you these days: dessert. And that's not even counting the tip.
Hyper-expensive desserts are the latest way increasingly upscale Atlantic City has found to separate casino winners from their winnings.

Calling the four-figure offering at Brulee: The Dessert Experience, just a brownie is a bit of an understatement. After all, you could get 371 boxes of Betty Crocker Supreme Ultimate Fudge Brownie mix for a grand. The brownie at dessert-only restaurant in The Quarter at Tropicana Casino and Resort is made with hazelnuts imported from Italy, topped with gold dust, served with a vintage port wine in a $750 Baccarat crystal that the dessert-eater gets to keep as a souvenir. Like the other offerings at the restaurant, it's served with two other courses of dessert.

"You have this beautiful atomizer filled with the finest port known to man, pastry chef Jemal Edwards told The Press of Atlantic City. You take a bite of the brownie, and as the flavors are coating your palate, your partner squirts the port onto your tongue. The acidity and sweetness from the port are hitting your mouth at the same time."

Who would make such a gamble on dessert?
Big casino winners, of course, Edwards said. The offering has not been a huge seller. In a year, Brulee has sold just three.

But that's not discouraging Red Square, a Russian-themed restaurant also in The Quarter, from offering another dessert at the same price, starting on Valentine's Day. It's a chocolate pound cake with a raspberry chambord "bellini" and a plate of black tapioca pearls made to look like caviar, along with real caviar, shaved chocolate, fresh fruits, chopped candied nuts and two shots of super-pricey vodka served in Russian Faberge eggs, which the customer keeps.

USAGOLD Daily Market ReportPage Update!#1517412/2/07; 14:13:50">
The Daily Gold Market Report has been updated.

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FRIDAY Market Excerpts

February 2 (DowJones) -- Long liquidation after a big run-up the prior two days sent gold futures and other precious metals sharply lower on Friday, traders and analysts said. Funds were among the noted sellers.

The COMEX April gold contract fell $11.50 to $651.50.

"To me, this is just a profit-taking move," said Frank Lesh, broker and futures analyst with Future Path Trading.

"We have had a really great run in the gold. It's up $50 almost in a month."

Comex April gold previously had run up from a close of $650.20 Tuesday to a 5 1/2-month high Thursday $667.20, a $17 gain, before correcting lower. The metal had triggered chart buying on a breakout Thursday around the $661 area, and a pullback back below this on Friday probably triggered some chart selling, one trader said.

However, at the $648 low, the contract held chart support around a series of daily lows from Friday through Tuesday between $646.60 and $646.90.

Much of the selling was from funds, said Lesh and others. "You can pretty much count on them all the time when you get a big move like this," said Lesh. "They're the big traders now."

Despite gold's pullback, the upward trend appears to remain in tact on the charts, Lesh said. "It's still a bull market. It hasn't really changed the outlook for the gold at this point," he said.

"You've got to have some back-and-forth action. It can't just go straight up here. I think people will come in next week, see where we get to and want to buy again."

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

geFlatliner – On Digital Gold#1517422/2/07; 14:38:55

First of all, I am curious to know how shall the international trade balances between major power blocks be settled: By US Dollar, by digital gold or by physical gold? Specifically, it would be interesting to know the US vs. Russia and US vs. China trade balance settling mechanisms. If they are settled in physical gold, then it is a completely different world; it would mean that US has withdrawn the claim to issue the world's reserve currency. In other words, US would no longer be issuing imperial tax to China & Russia. This will also ensure that physical gold shall be fairly priced.

Secondly, what shall be the trade balance settling mechanisms *within* power blocks? US may settle the Russian trade with physical gold, but how shall the Australian trade be settled: by physical gold or by digital gold? In other words, shall US issue imperial tax to Australia? Stated differently, US may not be able to tax Russia but may tax Australia. Inversely, Russia may not be able tax USA but may tax Belarus.

Finally, at the individual level, gold banking shall always degenerate into fractional reserve banking; that is my firm conviction. However, the insistence on removing silver from the monetary system, actually encourages individual usage of digital gold. Daily transactions would demand making payments in milligrams of gold; therefore in the absence of monetary silver, usage of digital gold is the only alternative to paper money. After living through a hyper-inflation, one may be tempted into a two pillared system, long term savings in physical while current account in digital. This system may survive for two generations; but in the third generation a bank run is guarantied. The third generation would in fact forget to make savings in physical gold; wouldn't they?!

SurvivorSavings: Do I Understand This Right?#1517432/2/07; 16:00:06

In the financial news this week, we see that savings are below 1933 levels. This seems to be another misleading statistic.

In 1933 average folks did not have money in equities. Savings were in the bank or in the mattress. Today the tax deferred 401 carrot is used to lure savings away from cash and in into equities. Since income placed in a 401 becomes shares rather than 'money', I don't think it is counted as savings.

Because shares in a 401 aren't accessible as cash, folks in need of cash borrow it however they can (home equity refis to payday loans). The only cash seen by many is a series of digits moving along in front of them with nary a digit to hold.

So, savings are negative, and cash is available to most only by borrowing. This looks to me like another factor that will support the effort to lead us into a cashless future.

Seems a bit ironic that those few who have put away some real (gold) savings are also counted among those without "savings" :)

- Survivor

Flatliner@ge#1517442/2/07; 18:11:31

Thanks for thinking about this with me (smile). I too have similar questions, but form the question from what might be a little different perspective. Upon reviewing your first paragraph a couple times, it seems that it is assumed that the digital currency might be developed on country boundaries – say, for the US. What if it's not? GoldMoney is used internationally. What if they copy that functionality? Let's say, some big collection of banks come together and form a New World Reserve currency based on gold that they have on reserve in their unaudited vaults. They might call it a NeWR and issue debit cards for function of their digits. At this point, a collection of banks has created a currency that they offer to the world to compete against all other currencies and they sell it as the globalization currency – the currency that is good in any country because it's backed by a claim to gold. With a NeWR, you wouldn't need take it to your central bank to exchange it for local currency because it is an acceptable local currency. Because it's not exchanged for local currency, the central bank doesn't build a reserve in this currency. I'm just thinking out loud, but wonder if such a system could be setup – or, better yet – endorsed (GoldMoney and many others have already proven the concept).

Power blocks and settling. Why would you settle if you already have the international reserve currency? If everyone takes the currency, why settle?

I also agree that what might start out as 100% backed always seems to degrade into fractional reserve banking. I would expect that whatever bank started this type of process would turn it fractional over time in order to increase bankers profits AND because banks make loans. As we all know, when you loan currency into existence, the reserve is replace with a debt service promise.

Thus, would someone be able to get a loan against a NeWR? Will countries be able to go into debt to acquire NeWRs? Or, will countries continue to use their local currency? Or, might a country offer up physical gold for NeWRs?

Seeing that the game of banker control has gone on so long, I'm starting to see that they might be willing to support something like this which is not a national currency, but a global one. Also, leveraging typical banker tricks, they might be able to make it look like it's really backed by gold – knowing that only a small fraction of the currency is ever really redeemed for gold while the rest remains in circulation to function for trade.

If something like this is in the works, how might it affect physical gold holders? How might it affect miners? How might it affect the derivative markets? More importantly, how might it affect me?

Also, would a NeWR provide an environment that would be favorable, unfavorable or neutral for physical gold?

R PowellSurvivor#1517452/2/07; 18:50:36

"In the financial news this week, we see that savings are below 1933 levels. This seems to be another misleading statistic."

I believe you are right. It is rather misleading to say that Americans have no savings or very little if you exclude all retirement accounts, social security, home equity, etc.

I remember the old passbook savings account book from my youth but I'd rather build savings almost anywhere than in a simple savings account. Even with the current softening in the housing market, money invested in real estate (home ownership) would have been much better place to hold savings than in a bank savings account. I hold some savings in the form of silver coins. These too have done quite well compared to bank savings, even with years of compound interest.
happy weekend...!

GoldiloxSocial Security as Savings?#1517462/2/07; 19:39:39

@ R Powell,

Let's examine that one!

My last statement from SSI said I had contributed about $87,000 over my 30 year career. Had globalism not halted my earnings at the height of my "earning curve", I would have contributed another $5500 or so over the past 3 and next 4 years until I reach 59.5 years. That would have put my contribution level at about $130K.

At 59.5 years, I am eligible to collect about $1100/mo, and at 62.5, I can collect about $1300/mo.

If I collect for about 9 years, I get my principle back intact, with no interest. After 18 years, I double my money, and my magic of compound interest calculator says that over 18 years, that amounts to about 3% per annum.

Here's the kicker. The majority of my "contributions" were made in 1980 thru 2000 dollars, worth a lot more than 2007 dollars.

What's worse, is that the COLA increases are moving with the bastardized CPI, and Congress will probably raise the eligibility requirements right before I reach them, as I am in the first four years of the Baby Boom. Double screwed.

On top of that, SSI money is completely taxable, so even if inflation adds anything substantial to my "benefit amount", the IRS will just take a bigger chunk back. With the top tax rate starting at $62K, even fixed income retirees will be considered "rich" according to the Tax code at the current inflation rate.

Savings? HA HA HA!

CometoseCOT#1517472/2/07; 19:45:34

THe commercials for the week as of last report

in SIlver were net short 4060 contracts

in Copper were net short 78 contracts

and in Gold were net short 16800 contracts

I'd like to see a graphic of this .....

Maybe we get another buying opportunity next week after
the blackboxes and the dopes finish

this looks like a two day deal to me .....

However after the cold hits the trading pits ......the plunge may be short lived .....because all sorts of energy products will be surging in price

The dollar is probably getting a lift out of this nonsense

mikal(No Subject)#1517482/2/07; 19:50:23{7090F484-EE2E-49AB-B08F-94102F7E13AB}&siteid=mktw&dist=bnb{7090F484-EE2E-49AB-B08F-94102F7E13AB}&siteid=mktw&dist=bnb Why Commodities Are So Contrary - MarketWatch - Myra Saefong's Commodities Corner - Myra Saefong - Feb 2 07
"There's logic behind recent moves in orange juice, natural gas"

Rookderivitives#1517492/2/07; 23:15:07

I suspect that Trichet and others comments about derivitives are, well, spin, and disinformation.
I suspect that democrat and republican political fighting is much more orchestrated than any evidence would suggest.
I suspect that beating swords into plowshares has no backing in international power, financial, political circles because we are a long way from figureing out how to have some other financial system.
I suspect that the lord has his hands full if he is trying to manipulate us towards a goal.
I suspect that the forum will be heathier with some parameters.

GoldiloxWe're Swimming in Liquidity, Aren't We?#1517512/3/07; 08:44:40


Although I'm pretty darn guilty of this personally, I can't turn around these days without hearing the words, "it's a liquidity driven market." Trust me, this is not about to go off into yet another discussion of the macro credit cycle. Collectively, we know global central bankers are "sponsoring" excess liquidity. We know Wall Street is capable of the same and is fully in gear at this point. We know the derivatives markets underpin excessive risk taking on the part of investors. We know private equity is the new fountain of youth for the institutional investment community. And we know leveraged hedge funds are not about to change their collective ways any time soon.

But what we don't know is how households/consumers will react ahead as, very much unlike the financial markets, they are not swimming in liquidity. Not by a long shot. At least not relative to the context of history. Given my fixation on the residential real estate cycle being an asset class capable of behavior modification when it comes to the US consumer, it highlights the need to fully recognize that US household excess liquidity availability has largely been driven by the monetization of asset inflation in both equities late last decade and residential real estate in the current, to say nothing of additional leverage assumption. In literally point blank terms, the following chart documents just how important stock and real estate asset inflation has been to growth in household net worth by the decade over the last half century-plus. As is clear, real estate and equities have never been more meaningful to aggregate household net worth expansion than is the case in the current decade. Hence, incredibly meaningful to consumer behavior. . .

Boom, Boom, Out Go The Lights?

So why is all of this discussion about household liquidity important? What does it mean to our investing activities ahead and the broad economy in general? Although this is somewhat of a generic comment, I believe the significance of these trends find their meaning in demographics. In very simple terms, we know that the baby boom generation is moving full speed ahead into retirement years. Point blank, assuming the boomers in aggregate actually do retire, their need for real liquidity will be meaningful. Very meaningful. Remember, I'm referring to a baby boom generation who has "learned" to become relatively dependent on asset inflation for a good many years now to generate household "liquidity;" asset inflation that has truly acted to underpin consumption.

Unless we can bank on asset inflation continuing, implying that asset inflation will "fund" boomer retirements as it has clearly funded their lifestyles for at least a good decade now, just where will retirement funds/liquidity come from? This is the issue, and it's clearly of longer-term importance as opposed to being something influencing the open of trading tomorrow morning. Can the Fed fund boomer retirements by simply printing money and inciting ever-greater household asset inflation?

Can the boomers "borrow" their retirement lifestyles as they have done up to this point by taking on ever greater household leverage?


Some fairly credible analysis of the precarious position of the US consumer and homeowner.

GoldiloxWHAT IS THE REAL COST OF CORN ETHANOL?#1517522/3/07; 09:01:17


Corn is the most widely produced feed grain in the United States, accounting for more than 90 percent of total feed grain production. Around 80 million acres of land are planted to corn, with the majority of the crop grown in the Heartland region. Although most of the crop is used to feed livestock, corn is also processed into food and industrial products including starch, sweeteners, corn oil, beverage and industrial alcohol, and fuel ethanol. The United States is a major player in the world corn market. Approximately 20 percent of its corn crop is currently exported to other countries.

The United States Department of Agriculture (USDA) has announced American farmers are expected to get 55 percent more for a bushel of corn in the 2006/2007 growing season than they received in the 2005/2006 growing season. Average annual prices are expected to increase from $2.00 per bushel to about $3.10 per bushel.

Thanks to Federal mandates and subsidies, corn used for the production of corn ethanol is expected to increase from ~ 700 M Bushels in 2000/2001, to 3.2 B bushels in 2007/2008 – an increase of 357 percent. On December 11, 2006, the USDA estimated 2006-2007 U.S. ending stocks would be 935 million bushels, down from 1.97 billion bushels in 2005-2006. That decreases the ending stocks by more than 50 percent and puts the ending stocks to use ratio at 8%, - the lowest in 11 years. It should be obvious to all, we are going to need a lot more acreage and big yield improvements if corn production is going to keep up to demand. Prices could exceed $4.50 per Bu by the end of 2008. That's a price increase of 125% over 2005/2006 season prices. . .

Cleaner Air

When most cars had a carburetor, adding corn ethanol to gasoline tricked the fuel system into delivering a leaner mixture to the engine. Since proponents tended to ignore the loss of fuel economy, it was assumed that all vehicles running on a 2 to 5 % mix would cause less air pollution. But that was 20 years ago. Today's fuel injected engines self-adjust to the fuel mixture regardless of fuel composition. Sensors tell the fuel system computer if the mix needs to be rich (when the engine is warming up), or can be lean (for increased fuel efficiency and lower emissions). Corn ethanol does little, if anything, to reduce the tailpipe emissions of late model cars.[v]

The environmental benefits of E85 are both uncertain and confusing. Test results vary depending on water contamination, engine temperature, test vehicle fuel system design, ignition system performance, and the ideological convictions of the tester. It is likely E85, when compared with standard gasoline, will reduce tailpipe emissions from oxides of nitrogen, 1,3-butadiene, and benzene. Methane and total organic gas emissions are greater. Carbon monoxide ad CO2 results vary from reasonably good to really terrible. The real eye opener is a large increase in formaldehyde (isn't that the stuff they use to embalm dead people?), and a huge increase in acetaldehyde emissions. A suspected neurotoxin, exposure to acetaldehyde vapor will irritate the victims eyes, skin and respiratory tract. The State of California has determined that acetaldehyde is a carcinogen.

And we should consider this concept. Do we release far more pollution into the environment during the production and processing of corn into corn ethanol than we save in act of consuming corn ethanol as a motor fuel? Probably. Corn is monoculture cultivation on a massive scale, requiring copious quantities of oil and natural gas for herbicides, pesticides, and fertilizers. These – along with tons of eroded soils – are deposited as a polluted waste in our rivers and oceans. If the agribusiness industry attempts to increase current levels of food production by deforestation and the use of marginal land, the net result is an acceleration of greenhouse gases and a decrease in biodiversity. Corn derived animal feeds are a potent source of methane, a greenhouse gas.

In my trusty Honda Accord, straight gasoline gave me roughly 31 MPG. When California added a low percentage of corn ethanol to the mix, my mileage dropped to 28 MPG. I had to use 9.7% more fuel to go the same distance. I just completed a like comparison in my Honda Pilot. My mileage dropped from an average of 22.5 MPG, to 20.4 MPG, a reduction of 9.3%. If the improvement in air quality is marginal (at best!), then doesn't the energy loss of corn ethanol actually increase the release of CO2? Perhaps it is time to challenge our obsolete assumptions. This is 2007. Does corn ethanol in the mix continue to make any sense?

That, of course, is a rhetorical question. If we evaluate corn ethanol as a fuel system, we must add the hydrocarbon and poisons produced during planting, growing, harvesting, conversion, transportation, blending, distribution, and consumption to the additional hydrocarbons released by corn ethanol waste, and the hydrocarbon penalty from energy inefficiency.


His analysis on corn costs lean toward some very credible questions, but he asks more questions than he answers verifiably - not always a bad thing.

At the end of the article, he goes off into a rant about "greenhouse gases", picking up the popular banter of a subject that the media and "textbook science" assume to be "fact", but is actually a Carl Sagan theory that was put into serious doubt by NASA's own probes to Venus 25 years ago. Not one of these "greenhouse gas" evangelists ever notices the other planets in the Solar System are ALL experiencing global warming, and then asks if the cause really is greenhouse gasses from hydrocarbon reduction.

Are we the victims of "misdirection" once again?

There is no doubt that energy is politicized even more (if that's possible) than gold.

MineroLiquidity#1517532/3/07; 09:03:32

Liquidity seems to be working quite well for the present. There are so many unknowns in the economic equation. Every day, I am amaised that the "baseless" economy keeps doing as well as it does. All reason is defied again and again. It will be a sad day when there are no more bunnies to be extracted from the Top Hat.
GoldiloxAnother soul who asks questions before "jumping on the bandwagon"#1517542/3/07; 09:29:18


Although the Washington Post headlines that "Humans Faulted for Global Warming" we have to note with climate change being noticed on other planets, there's probably also something else going on that MSS (mainstream science) hasn't fully explained to our satisfaction.


Nor is the MSM (mainstream media) likely to pick up the difference between science "theory" and "dogma", any more than they can with religion and its centuries of hiding evidence in the Vatican vaults and robbing archaeological evidence for storage in "private collections".Too many powerful political interests to fight, and stilll keep your media "licence".

Anyone who suggests that the Kings, Banksters and Religious War Promoters are deliberately manipulating and/or suppressing data to line their pockets and maintain their "God-ordained" privilege is immediately branded a "radical kook!"

I often wonder just how much "misdirection" we endure in the gold market, for no other reason than to maintain someone's "inherited" position in what is still very much a "class-based society".

Chris PowellA tale of two cities, and two futures#1517552/3/07; 10:55:49

11:58a ET Saturday, February 3, 2007

Dear Friend of GATA and Gold:

GATA's friend Mark Wallace writes:

"I think that what is instructive and lends support to GATA's hypothesis is the way gold has been advancing.

"The advances come in sudden bursts, with little opportunity to get on board. The powers that be are making sure that there is no steady advance, because that would garner widespread support from ordinary investors.

"In 1989 I bought gold eagles for about $389 per coin. Sixteen years later, in April 2005, gold was about $430 per ounce and I was barely breaking even. Then gold shot up to $725 over a 10-month period.

"The point here is that over 16 years virtually all the appreciation occurred in less than one-sixteenth of the holding period. Try catching that move unless you were in the gold sector for the entire time.

"Contrast this with the stock market, where there has been a slow but steady rise in the S&P with no serious setbacks to shake out nervous Nellies. The contrast could not be greater.

"Only people who believe in the Tooth Fairy could believe that this difference is coincidental."

Wallace's observation is consistent with a central bank program of controlled retreat with the gold price -- setting staggered levels of defense against free-market forces, dishoarding of central bank gold reserves and smashing the gold market at strategic points to prevent a stampede out of the fiat-money system and into the monetary metals.

As GATA, Jim Sinclair, and others -- even former Federal Reserve Chairman Alan Greenspan, really -- have noted, central bank gold sales are undertaken precisely when gold demand is threatening to overwhelm the fiat system, undertaken precisely when gold is about to be revalued dramatically upward. Central bank gold sales are NOT undertaken for the reason long given by central banks -- to earn a little money on a supposedly dead asset by exchanging it for interest-bearing securities like government bonds or even top-rated corporate bonds.

For, in the first place, having the power to make money by decree, central banks have no need to make it by more strenuous means. And second, the price of gold has increased over the last five years at an average rate of 23 percent -- four or five times the interest rate paid by government and top-rated corporate bonds. If "making money" as it is commonly understood was really the objective of central banks, they would be BUYING gold, not selling it.

No, selling gold, leasing and swapping gold, selling gold options, and such are the central bank mechanisms for deceiving and interfering with the markets in support of the central banks' own ever-depreciating currencies and in support of ever-increasing government power over the individual -- that's all.

This central bank scheme has worked for a while but its failure is inevitable; the gold of the central banks will be exhausted and they will turn to other methods of supporting their own currencies. Since modern central banking is built on deception, since deception is the very PREMISE of modern central banking -- as Fed Vice Chairman Alan Blinder remarked in 1994, "The last duty of a central banker is to tell the public the truth" -- the central banks probably will run out of gold a lot faster than their official figures suggest. After all, even the International Monetary Fund has just admitted that the central banks have been double-counting their gold, counting leased and swapped gold as if it is still in the vault. This double-counting has been done so that the markets might believe that the central banks remain in absolute control of the world.

GATA's purpose is to hasten the day when the gold price suppression scheme is understood and acted upon by people everywhere so that they may protect themselves against the sometimes slow and invisible expropriation and the sometimes sudden and rude expropriation that are basic to modern central banking. Every little purchase of the monetary metals strikes a blow for a new world order that is quite different from the one being contemplated by the financial elites.

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

mikalAll's coming to a head this year. A sample:#1517562/3/07; 11:19:15

Fishy stuff in gold market is making it into news reports
Submitted by cpowell - Friday, February 2, 2007. Section: Daily Dispatches -
Dear Friend of GATA and Gold:
Even as gold is down, it's a great day when GATA sympathizers constitute the majority of analysts quoted in the CBSMarketWatch report on the gold market, as was the case today in the report appended here, quoting, among others, GoldSeek's Peter Spina, Blanchard & Co.'s Neal Ryan, and Peter Grandich of the Grandich Letter. Ryan notes the "counter-intuitive moves" in gold -- that is, fishy stuff -- and Grandich cites the enduring coincidence of bear raids on gold whenever U.S. employment figures are announced. With a little help from our friends, the world is figuring it out.
CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.
* * *
Gold Drops But Still Ends Higher on Week | Myra P. Saefong | Friday, February 2, 2007
SAN FRANCISCO -- Gold futures dropped nearly $12 an ounce Friday as growth in fourth-quarter U.S. payrolls sent the U.S. dollar higher, but the metal still ended slightly higher for the week. Gold had climbed to a six-month high in the previous session.
After seeing such strength during the last several sessions, "the market could not extend itself and quickly, the nervous buyers have exited seeking to book profits as the U.S. dollar found some strength," said Peter Spina, chief investment strategist at "There is no reason to believe this is nothing more than just a temporary pullback to shake out some weak hands," he said.
And the decline will offer an opportunity investors, according to Ned Schmidt, editor of the Value View Gold Report. "This selling will set up the gold market for an oversold condition, which will create a buying opportunity for true investors next week," he said.
Gold for April delivery closed down 1.7%, or $11.50, at $651.50 an ounce on the New York Mercantile Exchange, following a drop to $648. The contract had gained $5.10 on Thursday to mark its third-straight winning session, trading as high as $667, the contract's strongest intraday level since Aug. 9.
"Today we find the funds making the play," said Julian Phillips, an analyst at, in an e-mail Friday morning. "Seeing no follow through from the physical side and from the long-term investor, the funds are hesitant to move in, so demand has dropped ahead of the weekend," he said. "The fall below support in the mid-$650s could pull it back a little further, but we are now in consolidation mode for the weekend at least."
"Nothing has changed except the dollar has firmed back up, he said. "This is enough to make the funds hesitate to make new long positions."
Putting pressure on gold, the dollar traded higher against other major currencies Friday, reversing early losses sparked by a government report showing the U.S. economy created fewer-than-expected jobs last month. Payroll growth in the fourth quarter was stronger than expected.
"Sometimes investors have to get used to these counter-intuitive moves in the metals and currencies markets," said Neal Ryan, director of economic Research at Blanchard, pointing out that analysts have been blaming gold's retreat on profit taking and other factors even though "every other indicator" should be pushing the price higher. "These types of moves should be looked at as the perfect entry point for an investor," he said.
The Labor Department said Friday that job growth rose moderately in January and the unemployment rate ticked higher. Nonfarm payrolls expanded by 111,000 in January, lower than the 170,000 expected by economists surveyed by MarketWatch. The unemployment rate rose to 4.6% in January from 4.5% in the previous month. Economists had forecast the unemployment rate to hold steady at 4.5%.
"Gold has once again succumbed to a bear attack, a feat that coincidentally continues to happen on the day U.S. employment figures are released," said Peter Grandich, editor of the Grandich Letter. "I believe it will be a bear trap and we shall see a reversal next week that leads us to a rally to $700," he said.
Elsewhere on the commodity markets, crude-oil futures climbed above $58 a barrel as forecasts suggested the cold snap in the northeastern U.S. will continue well into February. Prices had climbed near $59 a barrel Thursday to their highest level in a month, before falling back to end that day with a loss. See Futures Movers.
Moves in commodity prices have been particularly volatile lately, but a closer look at the fundamentals can help to clear up the confusion, analysts say. See Commodities Corner.
Economists at research firm Action Economics noted that many commodities have been performing strongly in recent weeks, finding strength in part from signs of generally robust global growth. Against this backdrop, other metals prices dropped on Friday. March silver dropped 2.6%, or 35 cents, to close at $13.375 an ounce, unchanged from the level it closed at a week ago. March copper declined 14.3%, or 10.75 cents, to end at $2.423 a pound, down 8.2% from a week ago. April platinum closed down 2.5%, or $29.30, at $1,163.50 an ounce. March palladium fell $6.65 to close at $338.25 an ounce. Both contracts ended lower for the week.
On the supply side, gold inventories increased 32,150 troy ounces to stand at 7.49 million troy ounces as of late Thursday, according to Nymex data. Silver supplies dropped 34,164 troy ounces to 113.93 million troy ounces, while copper stockpiles added 200 short tons to stand at 36,169 troy ounces. Over on the London Metal Exchange, zinc prices touched their lowest price in seven months Friday as concerns over supply levels eased.

A report that Red Kite Management, a $1 billion metals trading hedge fund, wants to extend the notice period for investor redemptions after losses of as much as 15% in January, may be affecting metals trading as well, analysts said Friday. Red Kite, run by Michael Farmer, Oskar Lewnowski, and David Lilley, asked investors in its metals fund to approve an amendment that would require 45 days notice before money can be withdrawn, according to a copy of a Jan. 31 letter from the firm obtained by MarketWatch.
"If anything, that makes things look even more bullish in my mind," Ryan said of the news. "The more information that hits metals markets of Refco and Amaranth type blowups, the more bullish I think it looks for precious metals," he said. "I can't imagine any investor is going to willingly say yes to extending redemption dates that only ends up hurting them in the long run."
When asked, Grandich said that it's possible that the decline in gold is related to this news on Red Kite, "but I suspect with gold at its highest level in months, any losses they could have related to gold would be from the short side," he said. "I do think it's an indication of what can happen in the overall hedge-fund industry when the bubble bursts in the stock and credit-derivatives markets," he said. And hedge-fund concern is "far more possible in regards to copper, given how much the hedge funds were long that market, the big decline and the further sell off today," Grandich said.
In equities trading Friday, the main benchmarks tracking metals and mining stocks fell along with the metals prices, poised for their first broad loss in four sessions.

FlatlinerEight tonnes#1517572/3/07; 11:37:09

Looks like there is some interest in the ETF side of things over the last couple days. I wonder if this trend will continue?

23 Jan 2007 450.30
24 Jan 2007 450.30
25 Jan 2007 450.30
26 Jan 2007 450.30
29 Jan 2007 450.30
30 Jan 2007 450.30
31 Jan 2007 450.30
01 Feb 2007 454.00
02 Feb 2007 458.63

968China aims to spend $200bn of reserves#1517582/3/07; 11:42:55

By Zhou Jiangong

SHANGHAI - The Chinese government is taking action to implement a new policy of diversifying the disposal of the country's over US$1 trillion foreign exchange reserves which was initiated by the Central Conference on Financial Affairs three weeks ago.
See URL for the complete article.

ToolieNow and Then#1517592/3/07; 13:24:04

Taking a look at a POG chart of the last several years, I pegged the duration of the big recent spike from July 2005 through May 2006.

So, what were we talking about way back at the beginning of that spike? Hmmm....

GOLD about $430 Euro 350
Cnooc was bidding for Unocal.
IMF was considering selling gold to help the poor.
Talk of Germany and Italy diching the Euro.
The forum sure is quit lately
On the Yuan; Greenspan -- It'll move soon, China – don't expect much change.

Gold about $650 Euro 500
Grumbling about China locking up African recourses
IMF pushing another gold sale
France talks of issuing it's own currency, more recently a carbon tax (tariff)
On the Yuan: China – don't expect much change

mikalRemoving the "I am" from IMF#1517602/3/07; 14:21:16

A "new age" for IMF gold

As Michael Kosares has explained, talk of IMF sales (and it is just talk) is market bullish for POG.
Too, the U.S. Congress would have to approve any sale because they wield final veto power(17%) over decision making in which an 85% consensus is needed.

Cutting IMF spending & budget items would go a long way towards alleviating it's bureaucratic (governmental) gaps in operating budgets every year of late. This would set a better example for the poor nations trying to make a living mining gold and feeding their people than divesting the supposed "people's" gold the IMF needs to legitimize their
funding and global assistance mandates and charter.

In the past, the IMF sold gold at the bottom of the gold market, likely to central banks. This time, it would be no different, as relatively speaking, we're still at
the bottom of what's about to come.

I agree with those like MK who assert that any IMF gold
distribution would bypass the market and end up swapped or
sold at a favorable price and without dealers
commissions to any one or more of the numerous central banks
known to be actively buying more gold.

As we noted, the IMF Crocker Report determined that sales must stay spread out over a lengthy period of time.
As if that wasn't enough, they stipulated that tonnage also would stay confined to sales quotas of the Central Bank Gold Agreement(CBGA)aka 'Washington Agreement'!
And this is likely a second straight year of signatory banks missing sales quotas, significantly I should add, after having completely filled sales quotas for seven straight years.

mikalBird flu prep#1517612/3/07; 14:35:47

U.S. Issues Guidelines in Case of Flu Pandemic
By Donald G. McNeil Jr. - New York Times - 02/01/07
ATLANTA, Feb. 1 — Excerpts: "Cities should close schools for up to three months in the event of a severe flu outbreak, ball games and movies should be canceled and working hours staggered so subways and buses are less crowded, the federal government advised today in issuing new pandemic flu guidelines to states and cities.
Health officials acknowledged that such measures would hugely disrupt public life, but they argued that these measure would buy the time needed to produce vaccines and would save lives because flu viruses attack in waves lasting about two months.
"We have to be prepared for a Category 5 pandemic," said Dr. Martin Cetron, director of global migration and quarantine for the Centers for Disease Control and Prevention, in releasing the guidelines. "It's not easy. The only thing that's harder is facing the consequences. That will be intolerable.""

"The historian John Barry, author of "The Great Influenza," a history of the 1918 flu, questioned an idea underpinning the study's conclusions. There is evidence, he said, that some cities with low sickness and death rates in 1918, including St. Louis and Cincinnati, were hit by a milder spring wave of the virus. That would have, in effect, inoculated their citizens against the more severe fall wave and might have been more important than their public health measures.
The guidelines did not suggest using the military to enforce quarantines, as President Bush said he might do when he first mentioned avian flu in 2005.
Dr. Levi said that using the National Guard to set up temporary clinics or move pharmaceutical supplies might make sense. "But they're not there," he said. "The people who know how to run field hospitals are in Iraq.""

Chris PowellSomebody knows it's still money: Gold rush tears up patch of Amazon jungle#1517622/3/07; 16:13:18;_ylt=Ai2G5vwc1NCZLKaN2wVRsztw24cA;_ylu=X3oDMTA5aHJvMDdwBHNlYwN5bmNhdA--

By Michael Astor
Associated Press
Saturday, February 3, 2007

It's a gold rush in the Amazon jungle, driven by the Internet.

Speeding past unbroken walls of foliage, a motorboat packed with gritty prospectors veers toward the shore of the Juma river and spills its passengers into a city of black plastic lean-tos veiled by greasy smoke.

All around them are newly dug pits, felled trees, misery and tales of striking it rich.

This is Eldorado do Juma, scene of Brazil's biggest gold rush in more than 20 years.

Drawn by a Brazilian math teacher's Web site descriptions of miners scooping up thousands of dollars in gold, between 3,000 and 10,000 people have poured in since December, cutting down huge trees, diverting streams, and digging ever-deeper wildcat mines, in an area that only months ago was pristine rain forest.

Hundreds of mud-covered men with picks and shovels hack at the earth, marking their tiny plots with tree branches and string. Others feed dirt into wooden troughs and the residue into pans. A lucky few will end up with tiny nuggets and flakes of gold to sell for $530 an ounce in the town of Apui, about 50 miles north.

Even the cooks, cleaners and porters serving the new industry are making about six times the minimum wage.

It's reminiscent of Serra Pelada, a mountain that became a gargantuan hole in the jungle floor after a gold rush in the early 1980s, immortalized in Sebastiao Salgado's photos of what looked like a hellish human anthill.

"This is even better than Serra Pelada. I've been mining all around the Amazon since 1978 and this is the best I've ever seen," said Joao Leandro de Azedo, 70, overlooking his stake from a hammock.

Azedo said he has panned some 70 ounces of gold worth a total of $19,000 since arriving 17 days ago, including 17 ounces in a single day.

Half the proceeds went to the man who staked out his plot, and 8 percent more to Jose Ferreira da Silva Filho, who claims to own the entire "garimpo," or wildcat mine.

Already, too many people are chasing too little gold and there isn't enough space for all the miners at the eight main digging sites.

Price-gouging (chain saws costing around $400 in gold) is rampant and malaria is spreading in the makeshift city, nicknamed Eldorado do Juma after the Amazon's mythical Eldorado, or city of gold. It already has bars, restaurants, barbershops, bakeries, equipment shops and jewelry stores, most of them constructed out of tree branches and tarps. A 16-room brothel is under construction.

Federal police armed with automatic weapons arrived last month, imposing a nightly curfew and cracking down on shootings but making it harder to get rich quick.

"Luckily, we caught it right at the beginning. It is a concern for everyone ... that this doesn't become another Serra Pelada," said Walter Arcoverde of the National Department of Mineral Production.

Local people had been mining this area of the jungle state of Amazonas in relative peace until Ivani Valentin da Silva, a math teacher in Apui, posted their pictures and stories on the Internet, said Antonio Roque Longo, the mayor of Apui.

"Perhaps he didn't have any idea of the impact it would have," said Longo. "People see this on the Internet and they think they're going to do the same thing. But the truth is, for every one person who strikes it rich there are 30 who go home penniless."

Da Silva said he clearly wrote that the gold would soon run out.

"Unfortunately, no one read the article," he said, denying any responsibility for the environmental damage being done by the thousands of fortune-seekers. His Internet posting forced federal police to pay attention, he said, and without that, "the area would be totally devastated."

Government geologists are trying to measure the deposits, while environmental regulators struggle to prevent miners from using heavy equipment or mercury, which joins gold particles together but can ruin the rivers. The fear is that like Serra Pelada, Eldorado do Juma will end up a scarred wasteland.

Already, small rivers of mud gush from streambeds at night, suggesting that heavy-duty water jets are being used illegally, despite promises to wait for permits.

"Most of the gold that can be mined manually has already been found, but if they start using heavy machinery this place is going to explode all over again," said Luiz Gonzaga da Conceicao, 51, a miner from Brazil's far west.

The land reform agency says the land actually belongs to the federal government, but now that the miners are here, there's talk of compromise -- authorities say they will permit pressure hoses, rock crushers and other machinery if miners police themselves and stick to an environmental protection plan.

But da Silva, the man who claims to own the whole area, says he's working on exactly that.

"This place has a great future. There are other minerals here besides gold. We have to get organized to exploit it," he said.

Off the record, many miners talk of threats and intimidation that ensure they pay da Silva's 8 percent cut. Da Silva denies it and says he has his own share of headaches and unseen costs.

So far, the federal government and most miners seem content to leave him in charge, if only to provide some order.

Meanwhile, prospectors travel up and down the river and deeper into the jungle looking for "fofocas," new finds.

"There's gold here for sure, the problem is finding an area to work. Every spot has three or four owners now. I'm just waiting for a new fofoca and I'll be right in the middle of it," said Jose Francisco Mendes dos Santos, 32, who came from the neighboring state of Rondonia. "A prospector's motto is hope, and his friend is luck."

Gilmar Predebon reckons his gold store in Apui buys about 70 ounces of gold a day and molds them into gold ingots. He figures the mines generate between 200 and 230 ounces a day overall â€" "a good amount of gold but nowhere near as much as you'd expect, considering all the talk."

Gold is fetching around $650 an ounce on world markets.

Mayor Longo thinks his city of 20,000 would be better off without the mine: "Sure, it's been good for the merchants but we have major health problems. Before the garimpo, we had malaria mostly under control here; now it's a huge problem again."

Others say the garimpo has improved things.

"This was a door God opened for Apui. Today the city has grown fivefold and people are flooding in from every corner of the country," said Antonio Carlos Santos, 48, who quit his policeman job to work the mines.

CamelMinimum wage#1517632/3/07; 17:13:04

Probably most of us here would agree that it would be tough to get by on $225 per week , the current minimum wage (before taxes), so probably a raise in the minimum wage would be benificial , at least for them.

Might even put more puchasing power into hands where it would turn over quickly, but will it be inflationary ,adding pressure towards higher prices.............having to pay $2 for a single dipped cone at Dairy Queen? Wage inflation is one of the worst kinds..... ask any Wall Street exec.

melda laureMore corny ideas.#1517642/3/07; 18:00:45

Tough? Well, how about just not comfortable? All it takes is 3 roommates to pay the rent, not having health insurance and living on rice and beans (you wont be able to afford beer).

SNIP: "Eric Fry, who burns less alcohol than he drinks, reports...

"Unsustainable subsidized food-burning."

That's how David Pimental, a researcher at Cornell University, characterizes corn-based ethanol production.
"Ethanol does not provide energy security for the future," he says. "It is not a renewable energy source, is costly in terms of production and subsidies, and its production causes serious environmental degradation."

Ethanol is no silver bullet, it isn't even a lead bullet, more like a lead balloon. Therefore oil will rise painfully and so too will gold rise gloriously.... eventually.... real soon now.

melda lauretricky energy accounting.#1517652/3/07; 18:15:19

I also dislike the EROEI metric as it is tricksy and slippery, showing false "profits" and missing useful alternatives.

Supposing one has a cheap source of energy that is not useful as motor fuel, it could be turned into motor fuel at a huge loss and still yield a profit. Likewise, the process might have intermedite byproducts that could provide energy outputs, but those outputs are so unuseable that their "value" is in reality zero.

It is analogous to the "gold equivalent" outputs of a mine that produces gold/silver/basemetals. Figuring a portion of the silver outputs as "gold equivalents" may make some sense for PM's. It is hardly justified for base metals however.

USAGOLD / Centennial Precious Metals, Inc.Step inside and shop at your convenience. Open 24/seven.#1517662/3/07; 18:43:22

shop for gold coins
R PowellGoldilox // SS payments#1517672/3/07; 20:57:07

I never said that paying into social security was a good form of savings. I never said that. I, too, would love to be free to put my own money into my own retirement rather than be forced to pay into the governments social security system. The issue in question was American savings, NOT how well each + every investment might turn out.

However, to claim that American savings is at an all time low while looking only at the old savings vehicle of passbook (or digital) money deposited in a bank while excluding all other forms of savings, including social security, is simply fraudulent. That is what I said. Reread my post if you need to.
happy weekend....

GoldiloxSSI and savings#1517682/4/07; 00:08:49

@ RP,

I wasn't trying to put words in your mouth, just laughing at the thought of anyone even considering SSI as "savings".

Survivor@RPowell#1517692/4/07; 00:32:17

"However, to claim that American savings is at an all time low while looking only at the old savings vehicle of passbook (or digital) money deposited in a bank while excluding all other forms of savings, including social security, is simply fraudulent."

Quit right. But consider what this means. If traditional savings are low, then the availability of liquidity to the individual saver is also low. The flood of liquidity in the economy is not readily available to those individuals. For example, home equity is only available as debt, and shares in a 401 are not available at all.

Traditional savings in fiat dollars is already one level of abstraction away from real money. When those savings exist only as equity, it is an abstraction of an abstraction. I think that the average person has no concept of what its like to have money in hand to purchase anything more than a Big Mac. This is as scary as anything I see out there. These folks are the proverbial frog in the kettle of water that is slowly heating to a boil. (Recite the Black Blade Mantra here.)

The point is that low traditional saving levels may not reflect the true paper net worth of individuals, but what it says about the changing perception of monetary wealth is important.

Of course, 'real' saving in the form of something shiney does not appear in traditional savings levels either, but we know the rest of that story.

- Survivor

mikal(No Subject)#1517702/4/07; 08:03:09

Sloth, Gluttony & The Coming Medical/Financial Tsunami - Devvy Kidd - Jan 25, 2007, Feb 4, 2007
One topic- implications for medicare funding - reminded me of cuts to medicare in the president's proposed budget Congress will shortly vote on.
As this and other entitlement spending is coming into focus especially on this forum, the need for gold is magnified many fold. After reading this all seems more certain, that though many will slim down, turn to folk remedies and home remedies and fall back on equity, gold, and other assets such as community and hard work,
this engaging article broadened my appreciation of the predicament facing the US, and other industrialized countries, of soaring health costs and rapid increases in older populations and their maladies. A decline in living standards must be relatively sudden and far-reaching as gov't cuts would be forced by any one of dozens of possible
emergencies and as asset values tumble, or are otherwise lquidated, revalued, unmarketable, overtaxed, and/or fall prey to chain defaults and leverage.
As Devvy Kidd implies, overextension of health payments
reaches further than to just the unqualified and illegal immigrants.
Handouts of many kind have been plagued by overreliance on unsustainable budgets, punitive payroll taxes for medicare, medicaid and SS, and "mathematical" models and wizardry.
Goldilox post yesterday on SS was especially apropo.
Here again many Americans and Europeans etc will adapt- cut back on spending and consumption, fall back on personal and local resources, slim down and trim down, turn to more 'basics', especially those with homes and workable land, computers etc.
Perhaps the majority of private pensions will survive intact in the best case scenario- certainly sizable holdings of gold and perhaps silver would more than offset problems elsewhere in the portfolio (but realistically few westerners own much beyond small jewelry items)-
including personal portfolios and managed funds of equities, money market instruments, CD's, cash & bonds. Hopefully these retain a modicum, if not most integrity, after crisis, further inflation, currency(dollar, euro, etc.) devaluation, and years of 'recovery'.

mikalGolden opportunities#1517712/4/07; 08:34:28 It's Our Turn, Our Time- Joan M. Veon - Feb 07
Less a warning of the NWO than an inspirational missive on the power of right positioning, will and the human spirit.

CometoseThe disconnect between the metals and the Hui#1517722/4/07; 11:37:27$silver,PLTADANRBO[PA][D][F1!3!!!2!20]&pref=G,$gold,PLTADANRBO[PA][D][F1!3!!!2!20]&pref=G,$hui,PLTADANRBO[PA][D][F1!3!!!2!20]&pref=G

The three charts are interesting in that footnote at the top indicating expectation of direction and amplitude by the individual that interprets the numbers and formation

GOLD and SILVER both indicated dramatically higher
Hui indicated dramatically lower..

WHy is this so ??????

It's an indicator of what can happen in the paper markets.
because of persons of question who have at their disposal unlimited supply of PAPER FIAT with which to Jam stocks .
(suppressed value shorting )

I grow weary of these games. THe games these players play will eventually lead to shortages ....brought on by the need for truth and REAL ECONOMICs to overtake those in these markets that want to use their paper to bluff with .

Musical chairs goes on until there is no SILVER LEFT on the shelves.

These companies have been under pressure for some time although it is more amplified than the actual corresponding movements in the price of the metals.

Many things about these companies are subject to variation
and makes them vulnerable to assaults ......

The metal in possession is not subject to these variables .

To overcome the effects of these suppressors , It might be necessary to obtain leverage in the metals markets in a way that is not hindered by these charlatans of darkness.

Bizarro-Greenspan"Falling Empires and Their Currencies"#1517732/4/07; 12:04:55

A very interesting read,unique charts too.

Sell the house in Zurich and board the golden bus,tally ho.

CometoseIf we are in a housing bust ,#1517742/4/07; 12:09:41$hgx,uu[w,a]daclyyay[pb50!b200][vc60][iup5,3,3!la12,26,9]

CometoseReal estate #1517752/4/07; 12:10:09,uu[w,a]daclyyay[pb50!b200][vc60][iup5,3,3!la12,26,9]

another disconnect from reality
Cometoseanswer#1517762/4/07; 12:33:03

Same as the people buying our bonds to keep the TIC data in line to supress GOld and KEEP EVERYBODY under the impression that
everything is HAPPY in THE LAND OF OZ .......

DERIVITIVES BOYS employed by your FED Chairman


Never has so much power been vested in the hands of so few.
( there is no more representative gov't ; it's the skeleton of the model set up here in 1776)

It seems so obvious .........that we all need to be establishing community self sufficiency / independence......

Like BLACK BLADE SAYS ........

WE are in Lemming CITY ..........Everything you have been taught and now take for granted may turn out illusionary

WE have been taught to trust the people that talk to us through the TV .......THEY are today's ' ROYAL HIGHNESSES"
and we are their subjects.

What if they are wrong and we get caught unawares because they over abuse a system that was never designed to do what they are now doing with money supply to socially engineer planned outcomes.

This is the picture that is drawn in CODE
: Daniel . THe reforming of a WORLD EMPIRE will not come to fruition ........SOmething is going to break .

Silver FoxRe: Survivor #: 151769#1517772/4/07; 15:41:17

If I can put my two cents in: I seem to remember most of the SS contributions are immediately borrowed and spend by federal government in the general fund. (In a deceptive reporting practice, these dollars have been used to reduce the amount claimed for the annual deficit.) A few years ago, when Paul O’Neil was Secretary of Treasury, he requested a study that would calculate the total national debt of the US. The study was halted when it totaled $45 trillion dollars. You can review a CATO paper at the attached website that reviews the study and read how it results in an inflationary environment. (This is why owning gold is now so important).

Goldilox is right. SS isn't part of the US's savings, it is already spent. All that is left is debt.

Silver Fox

mikal(No Subject)#1517782/4/07; 18:08:50

Gold price depends on American tax cuts for the rich – gold prices can reach a new high this year as Bush vetoes any increased tax by Democrats for the rich - Marla Guthrie - India Daily - February 3, 2007
Chris PowellSyria turns to euro for half of currency reserves#1517792/4/07; 18:38:45

From Agence France Presse
via Yahoo News
Sunday, February 4, 2007

Syria has replaced the dollar with the euro for half of its foreign currency reserves as part of efforts to counter possible U.S. sanctions, Prime Minister Mohammed Naji Otri said.

"The Syrian pound is sheltered from crises because of its large foreign currency reserves and because the euro has replaced the dollar in the case of about half of this money," Otri said, quoted by the state news agency SANA.

At the start of 2006 the premier sent out a circular instructing all ministries and state companies to adopt the euro instead of the dollar to repay foreign debts and for import-export contracts.

Since May 2004, Syria has been under U.S. economic sanctions banning imports of American goods apart from food and medicine.

"The pressure exerted on Syria because of its Arab and nationalist stand has somewhat slowed economic reforms and lessened some investments, but they will never halt the process" of reforms, said Otri.

He said that almost 2,500 laws and decrees had been passed between 2003 and the end of 2006 as part of the government's efforts to modernise and develop state organizations.

Chris PowellAnother yen carry trade -- this one boosts Brazilian economy#1517802/4/07; 19:19:28

Real Making Brazil a Haven for Capital

By Adriana Brasileiro and Alexander Ragir
Bloomberg News Service
Monday, February 5, 2007

Joao de Matos, whose travel agency has been a fixture in Manhattan's Little Brazil neighborhood since the 1970s, stared at a chart showing a surge in Brazil's currency against the dollar and fretted about his business.

"There's nothing I can do," said de Matos, punching numbers into a calculator to determine how much to raise prices on tour packages to Rio de Janeiro. "Brazil used to be a cheap place. It isn't any more."

As de Matos, 59, watched, the real strengthened as much as 1.1 percent on Feb. 1, its biggest rally since September. The gain is the latest spurt in a four-year, 69 percent advance that made it the world's best-performing currency against the dollar. This year, the real has risen against every one of 70 currencies tracked by Bloomberg except Iceland's krona.

A boom in exports of orange juice, sugar, coffee, soybeans, and iron ore, as well as interest rates at 12.9 percent, are luring investors to the real. The currency ended last week at 2.105 per dollar, near its highest level since May.

The gains have hurt profits at manufacturers such as Volkswagen AG, which exports to 30 countries from its Brazilian plants, and made the country increasingly expensive for visitors. A taxi ride to Rio's Copacabana beach from the airport almost doubled to $34 from $18 four years ago.

A penthouse room overlooking the Atlantic Ocean at the Copacabana Palace, a hangout for jetsetters from Frank Sinatra to Mick Jagger, costs $2,480 a night. The rooms went for $1,840 in 2005.

Demand for the currency has risen as international investors buy the country's debt. Yields on two-year benchmark government securities are 7.4 percentage points more than comparable U.S. Treasuries and 8.55 points higher than German bunds.

Brazil's benchmark local-currency, zero-coupon bond due January 2008 returned 18.1 percent during the past 12 months. Converted into dollars, the bonds returned 25.2 percent

The higher yields have made Brazil popular with investors borrowing in Japanese yen -- where the benchmark lending rate is 0.25 percent -- and reinvesting in Brazilian real debt, the so-called carry trade. Foreign investors boosted holdings of real debt more than five-fold last year to 38.4 billion reals ($18 billion).

"The Brazil trade has been one of the best trades over the last two years," said Claudia Calich, who manages $900 million in emerging-market debt for Invesco Inc. in New York. "The biggest gains are behind us, but I don't think it's over yet."

Flows of funds into Brazil have overwhelmed central bank efforts to contain the currency's advance. Banco Central do Brasil has sold reals for dollars every day since July. That has pushed foreign reserves to a record high of $91.6 billion from $56.8 billion a year ago and $32.4 billion in June 2002.

In September, Volkswagen said it would fire 3,600 workers from the 12,000-member workforce at its plant outside of Sao Paulo because the real's rally was cutting into exports. Usinas Siderurgicas de Minas Gerais SA, Brazil's second-largest steelmaker, said third-quarter profit fell 9 percent in part because the currency's gains eroded export earnings.

The stronger real has damped growth in Latin America's biggest economy. The central bank estimates gross domestic product expanded 3 percent in 2006, the slowest pace among the nine biggest countries in the region.

President Luiz Inacio Lula da Silva tries to discourage the gains. "The government doesn't have the commitment to an exchange rate target, but this doesn't mean that the government won't intervene in the exchange rate market and that it's unaware of the currency level," Lula said during an Oct. 23 online interview arranged by British Broadcasting Corp.

Brazilian exports rose 16 percent in 2006 to a record $137 billion, buoyed by the surge in commodity prices. Exports may climb another 11 percent this year to $152 billion, Ivan Ramalho, Brazil's deputy trade minister, said last month.

The steady gains in the currency over such a long period are unusual in Brazil, a country that has had eight currencies since World War II and suffered a 35 percent plunge in the real as recently as 2002. The real is now less volatile than the Japanese yen, Australian dollar and Norwegian krone, based on prices quoted by options traders.

"The currency here is a yo-yo; it's always going up and down," said Michael John Moran, a 72-year-old retired businessman who sits on the board of the U.S.-Brazil Chamber of Commerce. "That's one of the reasons American companies like to send executives here. If you can survive in Brazil, you're ready for bigger responsibilities."

Brazilians are heading overseas in record numbers. They spent $5.8 billion on trips abroad in 2006, the most since the central bank began keeping track in 1947. The previous record was $5.7 billion in 1998, when vacationers took advantage of a policy that pegged the real at almost 1-to-1 with the dollar.

The Tourism Ministry forecasts that 5 million people will travel abroad this year, up from last year's record of 4.5 million. Many are opting for more expensive destinations such as China, India and South Africa, said Virgilio Carvalho, a spokesman for Sao Paulo-based CVC Turismo, Latin America's biggest tour operator.

Wine-tasting trips to France, Italy, Argentina and Chile are rising as well, said Ricardo Farias, vice president of the Sommeliers Association in Rio. Membership in the association, which gives classes on wines, has climbed 20 percent a year for the past three years, he said.

A growing number are also making their way to New York and visiting Little Brazil, according to Regina Silva, who runs the Emporium Restaurant & Bar Brasil.

"It's excellent," said Silva, whose restaurant is located across the street from de Matos's travel agency, on 46th Street in midtown Manhattan. "Business has gone up a lot."

GoldiloxGold and HUI disconnect#1517812/4/07; 20:34:45

@ Comatose,

The HUI-PM disconnect makes Rob McEwen's plan of witholding mine output a few years back look pretty smart.

Hedged miners are under obligation to either deliver or unwind the hedge, but non-hedgies can hoard IT during a rising market, and only need cover their operations and storage costs.

mikal@Goldilox- "witholding production"#1517822/4/07; 21:27:12

Great move.
Brings to mind, what motive underpins the designation of "official" US gold from 'Gold in Reserve' to 'Allocated Gold' to 'Deep Storage Gold'?
(If history is any guide, this may be one of those "coincidences" that will survive only as folklore and inside information to be passed from generation to generation.)
What's to prevent the gov't from issuing their own gold ETF? Cornering the market? Colluding?
Goodness no! Just normal day-to-day 'commercial operations' that could be contracted out to the Fed! With
a little help of course from money center banks, bullion banks and/or brokerage houses as proxies on the world's markets and exchanges.

contrarianYet Another Reason to Buy Gold#1517832/4/07; 22:39:15

'Nuf said. Yet another reason to stock up. They don't have your best interests in mind. And definitely don't print the "news that's fit to print". Yet another outlet for the dual citizenship neocons (tread softly or be accused of hate crime!).

Why is the US press silent on Brzezinski's warnings of war against Iran?
By Barry Grey in Washington DC
3 February 2007

The major national newspapers and most broadcast outlets failed even to report Thursday's stunning testimony by former national security adviser Zbigniew Brzezinski before the Senate Foreign Relations Committee.

Brzezinski, national security adviser to President Jimmy Carter, is among the most prominent figures within the US foreign policy establishment. He delivered a scathing critique of the war in Iraq and warned that the policy of the Bush administration was leading inevitably to a military confrontation with Iran which would have disastrous consequences for US imperialism.

Most significant and disturbing was Brzezinski's suggestion that the Bush administration might manufacture a pretext to justify a military attack on Iran. Presenting what he called a "plausible scenario for a military collision with Iran," Brzezinski laid out the following series of events: "Iraqi failure to meet the benchmarks, followed by accusations of Iranian responsibility for the failure, then by some provocation in Iraq or a terrorist act in the US blamed on Iran, culminating in, quote/unquote, ‘defensive’ US military action against Iran..." [Emphasis added].

Thus Brzezinski opined that a US military attack on Iran would be an aggressive action, presented as though it were a defensive response to alleged Iranian provocations, and came close to suggesting, without explicitly stating as much, that the White House was capable of manufacturing or allowing a terrorist attack within the US to provide a casus belli for war.

It is self-evident that such testimony at an open congressional hearing from someone with decades of experience in the US foreign policy establishment and the closest ties to the military and intelligence apparatus is not only newsworthy, but of the most immense and grave import. Any objective and conscientious newspaper or news channel would consider it an obligation to inform the public of such a development.

Yet neither the New York Times nor the Washington Post carried so much as a news brief on Brzezinski's testimony in their Friday editions. Nor did USA Today or the Wall Street Journal. All of these publications, of course, have well-staffed Washington bureaus and regularly cover congressional hearings—especially those dealing with such burning political questions as the war in Iraq.

There is no innocent explanation for their decision to suppress this story. The Washington Post on Thursday published a large page-two column and photo on Henry Kissinger's appearance the previous day before the same Senate committee. The former secretary of state under Richard Nixon gave testimony that was generally supportive of the Bush administration's war policy.

Moreover, the Post's web edition carried an Associated Press report on Brzezinski's appearance. That article introduced subtle but significant changes to Brzezinski's speculative scenario of the road to war with Iran which had the effect of underplaying the sharpness and urgency of Brzezinski's critique of the Bush administration. It omitted the suggestion that a terrorist attack within the US could become the justification for war, and it removed the quotation marks from Brzezinski's talk of a "defensive" war against Iran.

The World Socialist Web Site on Friday telephoned the New York Times, the Washington Post, the Wall Street Journal and USA Today to ask for an explanation for their failure to report Brzezinski's testimony. None of the newspapers returned our calls.

As for the television news outlets, the "News Hour with Jim Lehrer" on PBS showed a clip of Brzezinski laying out his war scenario before the Senate committee, without making any comment. "NBC Nightly News" ignored the story entirely.

The suppression of this damning critique of the Iraq war, the conspiratorial methods of the Bush administration, and its drive to an even wider war in the Middle East is one more demonstration of the corrupt and reactionary character of the American mass media. It indicates that the establishment media is preparing once again, as in the run-up to the invasion of Iraq, to serve as a sounding board for the administration's war propaganda and lies.

contrarianOnce Again, Don't Believe the Hype#1517842/4/07; 23:01:47

Once again, don't believe the hype. The Dow is like a hospitalized terminally ill cancer patient on Valium and steroids, attended by a fleet of nurses (Federal Reserve member investment banks). It's a casio rigged by the players, whose fortunes are now directly tied to the health of the stock market, given that a large part of their profits are derived from their internal trading desks (and playing with client's moneys as hedge funds).

I know everyone keeps expecting a crash, but iappears the bull market in stocks WILL continue, but not for the right reasons!

Dow Transports Confirm The Bull Market

Cliff Droke

The first week of February was a memorable one for the stock market in many ways. From seeing the President make a rare appearance on the exchange floor of the NYSE, to the all-time high in the Dow Industrial index, to the breakouts in the small cap and mid cap sectors. But most memorable from a technical standpoint was the new all-time high in the Dow Jones Transportation Average (DJTA). That will be the focus of this commentary.

Every one of the eight major sectors that are part of the Group Movement Index (GMI) closed higher for the week ending Feb. 2, putting the GMI reading at a new high for the year as well as a 52-week high. The GMI is what is used to measure the strength or weakness behind the broad market, and it's arguably the simplest definition of whether stocks are in a bull market or a bear market.

What was especially gratifying to see this week were the breakouts in the Russell 2000 small cap index (RUT), the S&P 400 mid cap index (MID) and of course the Dow Jones Transportation Average (DJTA). Equally good to see was the Dow Jones Utilities Average (DJUA) turning up strongly this week and closing at just below its all-time high.

A bullish confirmation signal was generated in the Dow Jones Transportation Average on Friday. The DJTA finally closed above the 5,000 resistance level, which makes for an all-time high in this economically sensitive proxy. I've stated previously that a close above the 5,000 level would be a highly significant event, technically, and that it further holds the promise of further economic recovery as well as a continuation of the bull market in stocks.

Rook.,.#1517852/4/07; 23:15:03

One of golds active uses is in the smuggling markets.
Heroin and other illegal drugs account for, what, 500 billion a year? How does that amount get laundered without the big boys involved?

KnallgoldSavings#1517862/5/07; 00:05:36

"The issue in question was American savings, NOT how well each + every investment might turn out."

But exactly that is what savings are about!The value of savings are derived on what they will be worth at the time intended for spending.

Physical Gold in a FreeGold environment is the best savings vehicle.

melda laureWashington will save us from the climate? bwahahaha.#1517872/5/07; 00:18:50

Hmmm. interesting link sir ROok. Of course geopolitical shell games are one thing, physics is a bit less difficult: it is easy to weigh a pile of gold coins and hard to weigh the words of wizards (or scientists looking for BIG grant money).

So while I have some doubts about the utility of such expository stories (and I have my doubts about Mr Rozeff's comments) , I am quite certain the government has not won the war on drugs, or poverty, or inflation, or other inanities, and I can safely say they will lose the WOT and the war on climate change.

Gold is no more criminal than drugs, both are inert. Evil is a web woven by hands, it's essence is in its intention, not its materiel. In every orc flows the blood of the eldar; in every demon, the wind of angels.

GoldiloxLaundered, distributed, etc.#1517882/5/07; 00:26:51

@ Rook,

Many of the contraband transactions are way too large to be transacted in physical gold.

The question is not just how are they laundered, but distributed, as well.

When I hear about the resurgence of the Afghan heroin trade, I gotta ask:

"With border guards, air and transport manifests, evesdropping, account watching, and cash tracking, how does someone manage to find "new" distribution channels for literally thousands of tons of heroin? or $Millions of dollars of illegal arms? These quantities cannot just "materialize" with no traceable source of funding, and the amount of gold required for some of these transactions would choke COMIX.

Big Boys MUST be involved, as these amounts are too large even for suitcases full of $100 bills. They must be handled by digital transactions, or the deposit trail of cash would stick out like a sore thumb. Bankers are "trained" to ask questions if even a few $thousand show up in cash.

It's too much like the 911 airline puts or multi-national "charities". If word comes from the right office, investigation stalls immediately.

Topazthis'l be fun to watch.#1517892/5/07; 01:44:21

A curiosity needs to be resolved here ...and it will be!
Bond strength equates to dollar weakness equates to PoG strength however, Euro has balked at 1.29 as if it were the devil incarnate.
A PoG spike in all currencies is ONE outcome I'd consider a real possibility.

AdvocatusWashington will save us from the climate?#1517902/5/07; 05:17:39

@ melda laure,

You are right to doubt Rozeff's comments: anthropogenic climate change is very real. But there is indeed something artificial about the issue being hyped now after having been neglected before. The neglect and peak-oil BS served to keep the petrodollar going for a while longer. The hype is because the problem is serious, imminent, and an excellent common cause for uniting the world.

Do not be cynical about the sudden proactivity in Washington as to reducing dependence on oil and switching to new energy technologies. The technologies are already waiting in the wings. See for example the link above. But there is much more to come.

mikal(No Subject)#1517912/5/07; 05:42:45{7B057E5F-A1BE-49ED-9ACF-01720C5F524A}&siteid=mktw&dist=bnb

Golden suspicions
Commentary - Newsletters wonder about manipulation
Peter Brimelow - MarketWatch - February 5

mikal(No Subject)#1517922/5/07; 06:17:01

Golden suspicions
Commentary: Newsletters wonder about market manipulation
By Peter Brimelow, MarketWatch
Last Update: 1:04 AM ET Feb 5, 2007
NEW YORK (MarketWatch) - The past week was dramatic for gold. And the letters smell manipulation.
At Thursday's close, the yellow metal had risen to a high not seen since July last year (briefly). Then heavy selling in New York on Friday eradicated almost the entire week's gain.
Which is more significant the metal's ability to reach a new 2007 high, or its inability to hold it?
Veteran Market watcher Richard Russell of Dow Theory Letters thinks the former. Presenting a weekly chart, he says, in techspeak: "I've drawn the chart along with trendlines to illustrate the 'fanline principle.' The fanline thesis is as follows when three successive and less acute fanlines are drawn, if the item breaks above the third fanline, the item has reversed its trend to the upside. That's what I believe gold has done over the past two weeks. If so, we should see new highs in gold before the year 2007 is out."
Russell does not hesitate to question the character of Friday's sell-off: "Ironically, no sooner did gold bullishly break out of its fanline pattern, than the metals were whacked. And I wonder, was this just the action of traders taking profits on a breakout or was this the result of someone or some group dumping a load of gold on the market in an attempt to 'stem the bullish gold tide'? In the end, it really doesn't matte r..."
Bill Murphy's thesis that gold is subject to manipulation, advanced in his site, seems to me to be gaining ground. Earlier this week The Gartman Letter made virtually identical comments as Russell, while doubling its recommended gold exposure.
I like to gain perspective from the authoritative 5x3 point and figure chart available on the public portion of Australian site This gained another notch this past week and was unmoved by Friday's failure.
The Privateer is another service becoming ruder about the integrity of gold trading. On its analysis, a $660 close signals a decisive breakout. It writes: "On Feb. 1, the London PM Gold Fix was $US 660.20 ... The next day, Feb. 2, the spot future Comex contract closed down $US 11.20 at $US 646.20. Gold 'bugs' are not the only ones who can read Gold charts."
Martin Pring in www.'s Technical commentary does not concern itself with the whys of markets. So it serves as a good illustration of how serious Thursday's close was. Pring focuses on the Goldman Sachs Precious Metal Index: "The Goldman Sachs Precious Metal Index is breaking to the upside. The critical level appears to be that around 915 ... a more decisive upside breakout is quite likely now."
This was written on Thursday, after a 918.08 close. But Friday's was 901.23. Hmmm
Gold and commodity bulls received a crucial increase in support this past week when 13-D Research, written by my old friend Kiril Sokoloff, went bullish. This service, similar to The Gartman Letter in being very expensive and marketed to institutions, publishes weekly and concentrates on matters of grand strategy. It's not followed by the HFD. But its fans say its record is formidable.
Buying an outright oil position for what it says is only the second time in its history, 13-D suggests commodities could be starting a "huge rally, led by gold."
Once again this is illustrated by a gold chart as of Thursday's close. But 13-D is not likely to be shaken by one day's action.

mikalDerivatives discussions highlight unthinkable#1517932/5/07; 06:44:52 World Economic Forum: Optimists and Pessimists Battle It Out - SeekingAlpha - Feb 5 07
GoldendomeAn excerpt from Privateer newsletter#1517942/5/07; 08:38:14

Sorry for the length as it is not linkable.

On January 24, Mr Michel Pento penned an article entitled "Gross Analysis" for Here is an item in that article:

On January 6 on Fox business, a PhD economist stated that the US would be better off if it manufactured NOTHING and imported 100 percent of its (economic) goods from abroad. As things presently stand, manufactured goods account for less than 14 percent of US GDP, with consumer SPENDING accounting for 70-75 percent of the US "economy". The good Doctor would prefer that the US produces no economic goods at all. Why bother, just "buy" them from foreigners.

Totally ignored in this harebrained scheme (it takes a PhD in the humanities to come up with REALLY harebrained schemes), is a very simple question: "Buy them from foreigners, you say?" "WHAT WITH?"

Undoubtedly, our esteemed economist's answer would be - "MONEY, you dolt. US Dollars".

Welcome to the twenty-first century. Why bother producing economic goods when you can produce "money", in any quantity, out of the thinnest of air? Why bother any more with the old wives tale that money is a "medium of exchange", an economic mechanism which makes the trading of GOODS for GOODS much easier. Why bother with economic GOODS at all, just add "money" and stir. Presto, instant economic "growth". If it was not so tragic, it would be screamingly funny.

What if we were to conduct an experiment? Let us, for the sake of whimsy, bring back one of our cave man ancestors and sit him in front of us. Then let us produce, for his interest and edification, four identically sized pieces of paper. One has a recipe for chocolate cake written on it. One is a picture of the New York skyline. One is blank. And the fourth is a US 100 Dollar bill.

Our cave man friend would instantly discern that the pieces of paper were all the same size. He would also discern that each one was different in appearance. He would have no idea what the differences represented, nor would any explanations we could give him make much difference to him. He would not retain much interest in any of the pieces of paper for long.

But let us go further. Let us, by means of some very crafty sign language, convey to him the suggestion that he should offer us each piece of paper in turn to find out what happens. He offers us the recipe for chocolate cake - and gets a sharp elbow in the ribs. He offers us the picture of New York, and we leave the room. He offers us the blank piece of paper, and we burst out into gales of hysterical laughter. Finally, he offers us the $US 100 bill. We instantly sieze it out of his hand and offer him in return a two pound steak perfectly cooked.

If he is merely hungry, our cave man will instantly grab the steak and devour it. If he is a bit less hungry and a bit more intelligent, he will still grab the steak, but he will do something else. He will try with all his might to ask us a simple question. Waving the $100 bill around in front of us, he will want to know: "Where can I get some more of THESE?"

Our cave man friend has no inkling that this particular piece of paper is what we call "money". He does know about "exchange", but he has certainly never encountered a situation where something which he can see no practical or "economic" value in can be so effortlessly exchanged for something he wants. He reckons that we must be pretty crazy to want the piece of paper, but he isn't going to argue, he's just going to enjoy his meal.

Move that scenario forward to January 2007 and pin a PhD on the caveman and you have the mentality of those who think that the production of economic goods is wasteful and unnecessary when all that is required to gain anything one wants or needs is to wave what you call "money" in front of the nose of those who DO produce REAL economic goods.

Ignorance of what money is, of how it was discovered and incorporated into economic life, and of what is required in order for it to function to maintain and improve economic life is RAMPANT today. It covers all "strata" of society, but finds its most virulent peaks in the halls of academe and in the boardrooms of organisations whose sole function is to manipulate money.

This level of ignorance, and its attendant contempt for money, is a product of the "fiat money" era. Since that era began in mid 1971, two generations of Central Bankers, "economists", politicians, bankers, and market analysts and players of all descriptions have grown up. All of them, whether they are consciously aware of it or not, have the attitude that the only thing required to acquire economic goods of any and all varieties and magnitudes is to wave that $100 bill in front of the noses of those who are producing the economic goods.

Americans (and most others in the "developed" world) have good reason to have gained that attitude. Two generations of their professors, teachers, poltical representatives, bankers, brokers, and advisors have explicitly or implicitly assured them that it is true. And most people today, up to and including the "baby boomers" who are now on the verge of retirement, have based their entire adult lives on this assumed fact. None of them can see any difference between "money" and wealth. And Americans in particular have never suffered any repercussions from the fact that their nation has all but ceased to produce GOODS and now produces almost nothing but "money".

The danger that almost nobody foresees is that the day will come when waving those $100 bills around will no longer get you that two pound steak. All it will get you is the gales of laughter that our cave man friend in the experiment experienced when proffering the blank piece of paper. And that day will come when all the hot air exhumed by all the PhDs in all the banks (Central or otherwise) in all the world will no longer be enough to disguise a simple fact. The US is no longer producing ANYTHING the rest of the world wants. That being the case, of what VALUE are these pieces of paper they persist in calling "money"?

Such a bizarre twisting of economic truth could and would never take place in a nation which uses Gold as money. Amongst many reasons for this is the simplest one of all. Unlike pieces of paper or entries on computer hard disks, Gold cannot be created out of thin air. It is in itself a TANGIBLE economic good. It's special distinction over all other economic goods is that it is the most "tradeable" good. As such it has become the good that people want to hold in order to exchange for other goods. THAT IS WHAT MONEY IS. It is a medium of exchange. And in order to become a medium of exchange, an economic good must first be an ECONOMIC GOOD.

When one sees "arguments" like the one presented by our PhD economist being presented and taken SERIOUSLY, one may know that the fate of what is presently used as "money" is sealed. No cave man, or civilised man for that matter, would ever consider the possibility that one could produce nothing and simply "import" one's goods from those who do. It takes a politician, a banker, or an "economist" to harbour such notions.

Gold became a "barbarous relic" in our "modern times" more than three decades ago. Now, the ideas which Gold underpinned in its role as money - freedom and liberty, political and economic - are well on the way to suffering the same fate. Ignorance breeds contempt of a lot of things. The more profound the ignorance, the more contemptible the result.

TownCrierSame song, next verse...#1517952/5/07; 08:39:39

Whenever a person finds themself with a surplus of spendible/investable dollars, he stands at the blessed crossroads of Decision. "Shall I enjoy the real fruits of this economic game, or shall I merely keep score?"

Ture of every thinking man -- from the hunter/gatherer to the agriculturalist to the industrialist to the entrepreneur -- he knows, right down to the core of his being, that the vital objective in the game of life is toward the obtaining(ownership) and enjoyment(use) of the tangible fruits.

To be sure, the function of money is merely that of digital scorekeeper along the way -- marking out ones POTENTIAL (no guarantee) progress toward an actual realization of fruits at each blessed crossroads of Decision.

Some of the fruits we've gathered at each step along the way:
- - Food
- - Functional (and Fashionable) Clothing
- - Cars and Trucks and Bikes
- - A Home
- - Books
- - Art
- - Toys
- - Tools, Tractors, and other Tangible Capital

Some of the older participants remember this long-past signpost, "GOLD: $100/oz"

Standing at that crossroads, money was society's favorite digit to create and manipulate (hello depreciation), while physical gold was an unprintable asset.

And so, with satisfaction to the core of our being, we made our decision. We bought gold.

Some younger participants remember this more recent signpost, "GOLD: $260/oz"

Standing at that crossroads, money was still society's favorite digit to create and manipulate (ever weaker), while physical gold was an unprintable asset.

And so, with satisfaction to the core of our being, we made our decision. We bought more gold.

Our very youngest participants now may look upon the current signpost, "GOLD: $650/oz"

Standing at this crossroads, money REMAINS society's favorite digit to create and manipulate (unrelenting slide against tangibles), while physical gold EVER SHALL BE an unprintable asset, an item of portable property/wealth.

And so, with satisfaction to the core of our being, we made our decision. We bought more gold.

Good news... YOU determine the quality of your life by the Decisions YOU make at the crossroads. Every moment of every day gives you ANOTHER opportunity to correct your wayward strategy. Life is definitely one example where 'high score' is NOT what matters most -- gather ye fruits while you may!


Thoreauly@ Goldendome#1517962/5/07; 09:18:07

It seems that China will soon be deciding what we manufacture and pretty much everything else we do, as we are quickly becoming little more than a colony (see link) whose titular rulers don't have a clue what's happening or the will to do anything about it if they did.

In Gold We Trust.

GoldiloxThe Fear of $650#1517972/5/07; 09:47:22

$650 / oz sure seems to bring on some serious short action each time it is breached. It's becoming quite a "line in the sand".
USAGOLD / Centennial Precious Metals, Inc.Info and assets, assembled especially for those taking their first step...#1517982/5/07; 10:33:17">gold ownership starter kit
Paper Avalanche@ Goldilox - The $650+ Abyss#1517992/5/07; 11:07:19

Hi Goldilox,

I agree entirely that $650 is the final line in the sand. Beyond that lies the great abyss of POG that has rarely been breeched before. In fact, the the entire history of POG, it has closed above $650 a total of only 50 days (27 days in 1980, 21 days in 2006 and 2 days in 2007 so far).

I wonder if when the dollar faction sold very heavily into the market in 1980 if the majority of their sales were sold into the $650-$750 range to get gold under control of the dollar, and if those contracts have simply been rolled forward since that time for a nominal fee / interest. If so, $650 may mark the tipping point that precipitates much of what Another and FOA discussed. Also if so, I wonder which big banks may be holding the bag.

Take care,

TopazGold:Silver.#1518002/5/07; 11:21:27

Whilst it is all good for gold in the coming days, we need to be mindful of what lies ahead (assuming the wheels don't fall off in the mean time)
Comex Gold, rolling through the delivery month, loses it's traction with each passing Oz delivered, whereas Silver otoh, anticipating it's moment in the sun, starts to get all frisky.
The accompanying Ratio Chart identifies how the lead-up and consequent delivery window through March has been good for Silver visavee Gold more often than not ...good luck!

You may have to configure it for 3 yr's to get the drift.

Topazbuggered if I know why it does that!#1518012/5/07; 11:25:15$gold:$Silver&p=D&b=5&g=0&id=0

...this should be the Ratio Chart.
TopazLine in Sand 2007.#1518022/5/07; 11:42:57

Continental paleface edict: New wampum heap big on sale at 1.30+
TopazThings that go "bump"...#1518032/5/07; 12:06:14

As the 6.2 mag quake in Cuba drifts off into cyber-oblivion, it's curious to note the lack of any aftershocks associated with this event.
Almost without exception, a quake of this magnitude produces some form of post-rattle! hmmm?

mikalGeopolitics figure in commodities scramble#1518042/5/07; 12:20:48

Monday view: The West must handle with care China's growing interest in Africa
By Ambrose Evans Pritchard | 05/02/2007 | Excerpt:
"The new Cold War between China and the United States is taking shape, in Africa. Last week the US Defence Department quietly launched its first military command dedicated to black Africa and the Sahara - until now a forgotten annex of the Pentagon's European and Mid East operations.
Known as "AFRICOM" it is ostensibly designed to fight al-Qa'eda and cope with natural disasters. It is equally aimed at Beijing, a warning that the Communist regime will meet resistance if it tries to bottle up a large chunk of the world's oil, gas, and mineral reserves - not to mention its arable land, the strategic prize a decade hence as food runs short.
Over 10pc of America's oil imports now come from Africa, a figure expected to rise to 25pc in short order. Much of the world's scarce uranium, platinum, chromium, cobalt, and copper are to be found there."

USAGOLD Daily Market ReportPage Update!#1518052/5/07; 14:58:43">
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 5 (DowJones, MarketWatch) -- Comex gold futures gained momentum on Monday amid an early firmness in oil prices and geopolitical talk, traders and analysts said. At settlement, most-active April gold was up $4.60 at $656.10.

An analyst at MKS Finance said after the open the yellow metal regained some momentum on firm oil prices and stronger language by U.S. Secretary of State Condoleezza Rice against Iran.

Crude oil at the Nymex traded to a high of $59.95 a barrel - its best level in a month - after a forecast of cold weather for the U.S. Northeast. According to the National Weather Service, U.S. heating demand is expected to be about 20% above normal in the week ending Feb. 10, which will boost consumer demand for heating fuels, the analyst noted.

Analysts at Natexis Commodity Markets said in a research note released Monday that most of the key drivers behind the bull market for gold and for the other precious metals remain in place.

A report last week that Red Kite Management, a $1 billion metals trading hedge fund, wants to extend the notice period for investor redemptions after losses of as much as 15% in January, may further affect metals trading.

Red Kite, run by Michael Farmer, Oskar Lewnowski and David Lilley, asked investors in its metals fund to approve an amendment that would require 45 days notice before money can be withdrawn, according to a copy of a Jan. 31 letter from the firm obtained by MarketWatch.

"All eyes seem to be on whether funds are in trouble with another Amaranth-type sell-off, and given the sell-off in oil and the metals in early January, this would not be a surprise," said William Adams, an analyst at

"However, if the damage was done in January, then this may well be a 'sell the rumor, buy the fact' situation..."

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

TownCrierAfrica-China relations set to soar#1518062/5/07; 15:14:45

Chinese President Hu Jintao's visit to the African continent offers the potential for more aid, trade and business.

Hu is currently in Namibia, the fifth stop of his African trip after Cameroon, Liberia, Sudan and Zambia.

Cameroon president Paul Biya welcomed Chinese investment in his country and signed several economic agreements with Hu on the first leg of his visit. In Liberia, the goal was to write-off Chinese debt with Hu and sign key infrastructure contracts in return for its mineral wealth.

During his visit to Zambia, Hu visited the Chinese-owned Chambishi Mine in Zambia's Copper Belt region north of Lusaka where a new $200mn smelter is planned.

Some 200 Chinese firms already have investments in Zambia. Chinese firms will operate free of import duties and VAT in the economic zone.

After his visit in Namibia, Hu will be heading to South Africa, Seychelles and Mozambique.

... skeptics are worried that Jintao is on the prowl for a one-sided investment bonanza that will continue to fuel China's rapid growth rate. They say Africa may get the short end of the stick in a skewed trade relationship that has seen the rate of exploitation of African labour by Chinese firms increase in the past decade...

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

"Skeptics"... does that mean "the West"? Since when has the West cared two hoots about exploitation of cheap foreign labor???

Are you holding mere paper? Or mineral wealth? Remember, when lines are drawn in the sand, it's always because it's the "fruit" that matters.


mikalGoldman in the news... again#1518072/5/07; 15:17:46

Spot Gold Outlook Strong, GS Keeps Upper Limit
Dow Jones Newswires - February 5, 2007

TownCrierRogers Says More Funds May Collapse After Amaranth#1518082/5/07; 15:20:41

Feb. 5 (Bloomberg) -- Jim Rogers, who predicted the start of the commodities rally in 1999, said more hedge funds may collapse after the demise of Amaranth Advisors LLC and losses by metals-trading hedge fund Red Kite Management Ltd.

``There are lots of hedge funds that are going to be in trouble,'' Rogers told journalists at a briefing in Sydney today. He didn't know which funds may be affected or when. ``We're going to see many, many more explosions.'' Rogers also forecast a shakeout amongst some private equity groups.

``I don't know who has got what positions and in what, but I know when some of them start blowing up, it's going to have huge ramifications,'' Rogers said. ``When Amaranth blew up, it drove natural gas down to absurd prices and it was a spectacular buying opportunity for those that were still solvent and had their wits about them.''

Rogers, 64, created a series of commodities indexes and last month predicted oil will rise to $100 a barrel. He's in Australia briefing clients of UBS AG.

``There's going to be a gigantic shakeout when that whole mess starts coming apart. This has to end badly.''

Hedge funds are largely unregistered pools of capital that let managers participate substantially in gains on investments. Hedge funds globally control more than $1.3 trillion, more than double the figure five years ago, according to Hedge Fund Research Inc. in Chicago.

Rogers, chairman of Beeland Interests Inc., traveled the world by motorcycle and car in the 1990s researching investment ideas for his books, which include ``Adventure Capitalist'' and ``Hot Commodities.''

He said he had no money invested with hedge funds.

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

"... NO MONEY invested with hedge funds..."


TownCrierRussia's Norilsk Nickel may be nationalised#1518092/5/07; 15:30:41

MOSCOW (AFX) - Russian billionaire Vladimir Potanin, who controls mining giant Norilsk Nickel, has not ruled out that the metals group could be nationalised by the government, in an interview published in the Russian edition of US weekly magazine Newsweek.

"I hope that the law on private property can be sorted out. I am convinced that the State should resolve the problems that society is incapable of solving by itself, and not take on problems that the business world can handle successfully", he said.

"If that happens, I will not see it as a personal tragedy, but as a change in the business climate."

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

Are you a mine(share) holder, or are you a metal owner? In this era of strategic nationalizations, the free-and-clear metal owners will continue to sleep better than the miners of in-ground resources. Warn your friends. We've been saying this for years, folks...


mikalDebt dominoes a game of fools#1518102/5/07; 21:34:00 Ecuador will not pay "illegitimate" debt, economy minister says - People's Daily Online - February 6, 2006
Rook.,.#1518112/5/07; 22:01:36

Roach at Stanley
'' begs the question of why -- why the developed world is pushing back so hard against the very process of global integration it has so long espoused. Granted, motives are always open to subjective interpretation. But I suspect that on one of the most important, but overlooked issues in the current global debate -- that the rich countries of the developed world are simply unprepared for the stunning successes of an IT-enabled globalization. Lacking in preparation, the developed world is now on the defensive -- and, unfortunately, ripe for a politically-driven backlash.'
Protectionism here we come?

Rook.,.#1518122/5/07; 22:12:47

' of the great mysteries of the past two years: why the cost of borrowing in the capital markets has remained low even though central banks have been raising rates.
"Rising policy interest rates have had no effect on slowing the expansion of liquidity . . . because increases in short-term rates did not cascade into the pricing of the bigger . . . tranches of the liquidity pyramid," the group says in a research report. "Now new-fangled financial instruments create liquidity independent of central bank control."
Does the above indicate a decoupleing of parts of the economic system, to enough of an extent, that in time it could allow the US to raise interest rates to support the dollar, if some Volcker type moment arrives, and have the liquidity train continue to operate at a lower interest rate? Is there any sense in this speculation?

Chris PowellGATA sympathizers invited to gather in Dublin for drinks and a movie#1518132/5/07; 22:20:56

10:05p ET Monday, February 5, 2007

Dear Friend of GATA and Gold:

GATA's old friend and world traveler George Roche (he has attended GATA events in Vancouver, New Orleans, New York, and Geneva) reports that the film "Mine Your Own Business," which criticizes the so-called environmental movement and defends the extractive industries, will be shown at noon Sunday, February 18, at the International Dublin Film Festival. Roche will be in Ireland that week, plans to attend the festival and see the movie, and would like to get together then for coffee or a pint or two with any GATA sympathizers in the neighborhood. If you're interested, please e-mail Roche at This email address is being protected from spambots. You need JavaScript enabled to view it. and he'll arrange something.

No one denies that the extractive industries can damage the environment. But the solution is not to shut them down -- soon no one would have a roof over his head or clothes on his back -- but to ensure remediation of the damage by building the price of remediation into the price of the product, perhaps by requiring the extractive industries to post remediation bonds.

To do this the extractive industries have to be given a better chance of making a decent profit, something that will be so much harder as long as central banks are inciting and subsidizing investment houses in shorting all sorts of commodities. That is, if you're sore that, for example, an open pit gold mine wasn't closed up or that a mine's heap leach pad failed from negligence, you might blame the gold price suppression scheme as much as the mine operators, for it is the price suppression scheme that can put unbearable pressure on the industry to cut corners.

Look around: Only prosperous societies can afford environmental protection. Compare, say, Oregon and Haiti -- logging being a sustainable industry in the former even as it was allowed to denude the latter. For subsistence societies don't care how much they damage the environment; all they care about is surviving one more day, the planet be damned. As the extractive industries move to the developing world with its subsistence societies, better prices for commodities become a matter of international social justice. Indeed, the gold price suppression scheme has killed tens of thousands and condemned millions more to poverty throughout the developing world. Blind environmentalism there is just another form of colonial oppression.

You can learn more about "Mine Your Own Business" here:

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

melda laureThe Modulus of Elasticity of markets.#1518142/5/07; 22:27:23

@ Rook.

Simple notions of supply/demand only give the "usual" effect where one or the other is held constant, or where the increase in one measure is enough to overwhelm any simultaneous increase in the other. In real life both are moving targets.

Since demand for credit (especially in housing, but also derivativized securitiztionized sausage-debt-obligations) is growing at ABSURD rates, it is hardly surprising that even enormous SUPPLY can be absorbed at higher prices.

The same is happening in the oil markets. Higher prices have not "reduced" total demand (yet). But the rate of increase in demand is off a bit.

A better question might be: what part of the credit-consuming market is "Price inelastic"?

Furthermore, every spring has its breaking point.
Prices, (like earthquakes) lurch. Tension builds then "pops"- (likely to happen soon for POG)

Chris PowellGoldman Sachs seeks share of second Indian commodities exchange#1518152/5/07; 23:27:34

By Reena Zachariah
Business Standard, Mumbai
Tuesday, February 6, 2007

MUMBAI -- Nearly a month after acquiring 5 percent in the National Stock Exchange, Goldman Sachs has proposed to buy a stake in the Multi Commodity Exchange (MCX), India's largest commodity bourse.

Sources said Goldman Sachs, which holds 7 percent in the National Commodity and Derivatives Exchange Ltd (NCDEX), the other leading commodity bourse, said the MCX buy would be considered an investment and not a strategic acquisition.

An official spokesperson for Goldman Sachs said, "We would not like to comment on market speculations. But there are a lot of things on the company's agenda in the days to come."

Apart from the New York Mercantile Exchange, London Metal Exchange and The Tokyo Commodity Exchange have also initiated talks with MCX.

The talks were being initiated ahead of the publication of final guidelines on foreign shareholding in Indian commodity exchanges. The idea is to firm up plans in readiness for the guidelines.

The Forward Markets Commission has told all commodity exchanges not to change shareholding patterns until the new guidelines are issued.

The shareholders of MCX include Financial Technologies (I) Ltd., State Bank of India and its associates, National Bank for Agriculture and Rural Development (Nabard), National Stock Exchange of India, Fidelity International, Corporation Bank, Union Bank of India, Canara Bank, Bank of India, Bank of Baroda, HDFC Bank, and SBI Life Insurance.

Chris PowellJohn Dizard: Goldman Sachs and its magic commodities box#1518162/6/07; 07:11:24;_ylt=As8BJYdW8A6TcItVo9VGNnv2ULEF;_ylu=X3oDMTA5aHJvMDdwBHNlYwN5bmNhdA--

By John Dizard
Financial Times, London
via Yahoo News
Monday, February 5, 2007;_ylt=As8BJYdW8A6TcItVo9VGNnv2ULEF;_ylu=X3oDMTA5aHJvMDdwBHNlYwN5bmNhdA--

Two weeks ago I unfairly profiled the Chicago speculator community. "Profiling," in the sense of accusing or convicting a suspect based on race or general appearances, is wrong, even in the case of such a rich and privileged group as the "locals," or speculators in the commodities pits.

I was describing the practice known as index roll congestion, or "date rape." This involves profiting from the requirement that public investors' positions in commodities indices be "rolled over" from one contract month to another over a known five-day period. The price of the old month's contract is depressed and the price of the new month's contract is inflated. This can be a huge source of profit for those ready to take advantage of the naive public.

In the column, I was correct to point out that index roll congestion costs people who use indices such as the Goldman Sachs Commodity Index something in the order of 150 basis points of return a year. Given that formula-managed commodities index funds have $100 billion in assets, of which GSCI-linked funds account for $60 billion, a lot of money is being lost by the public to someone.

My mistake was to look at a line-up of the participants in trading on the floors of the exchanges and point out the suspects who wear gold chains, mink coats and alligator shoes, instead of the clean-cut, polo-shirted, Harvard graduate working for the famous public company.

Jim Bianco of Chicago's Arbor Trading, understood why I would have made that assumption. "The locals are one of the few groups on the planet who are guilty until proven innocent," he said.

The economic function of the locals, or speculators, in the view of public policy, is to provide liquidity for hedgers who want to offset the risk of a future requirement to buy or sell a commodity. For a price, the speculator commits his capital to taking the risk the hedger is unwilling to assume. Hedgers are supposed to be nice people who act for consumers; speculators are supposed to be non-nice people who wear pinky rings, buy magnums of champagne in nightclubs, run the exchanges and bet against the public.

I had thought that the mountain of index fund money, with its fixed, known periods of buying and selling, would be a source of profit principally for the speculators.

Actually, the problem is that there probably isn't enough speculative capital relative to the huge weight of the index funds. And, one might add, firms that manage the index funds. Firms such as Goldman Sachs.

Locals besieged me with e-mails insisting on their innocence and said that Goldman was likely to be the principal beneficiary from the index roll. I finally did get a response from the firm. First, Goldman pointed out that it was not the only seller of funds -- or notes or swaps -- linked to the GSCI. (It is, however, the largest user of GSCI-linked product). The firm said it was obligated only to deliver the closing price on the reference days for each commodity contract in the index.

That means Goldman knows the size and position of the target it must hit and can, as its people say, "manage our corresponding position". That means that it has to deliver a price at the end of the roll period. If it can cover that obligation at a better price, it will, and pocket the difference.

While Goldman won't disclose just how good a business this is, it agrees the business is consistently profitable. Given that Goldman knows how many contracts it has to buy and sell on certain dates, that in many pits the GSCI is the biggest single factor in the market and that it has many trading hours to cover its positions at advantageous moments, its profitability is not surprising.

The GSCI has not been as profitable for all the investors who use it to get commodities exposure. Last year it lost about 15 per cent on a total return basis. Goldman itself had a record year. The customers' yachts weren't just small, they were under water.

There is no failure to disclose here since Goldman lays out the GSCI's terms and conditions on its website and in customer contracts. The real failure is with the institutional investing community that still does not understand how commodity markets work.

Goldman's people and its shareholders aren't the only winners in the game with institutional commodity investors. As one local said: "Grain companies [and other physical dealers] are winners too because they own storage and are short hedgers."

Also commodities funds that give some freedom to their managers to roll their positions on dates other than when the index rolls take place can earn a significantly better return.

But that requires the investor to concede some discretion to the manager. And too many want a magic, automatic box that prints money. Sadly, that doesn't exist. Unless, that is, you own an investment bank that has an ingenious marketing department.

* * *

S&P to Acquire Some Goldman Sachs Indexes

By John Spence
Tuesday, February 6, 2007

BOSTON -- Standard & Poor's said Tuesday it will acquire a commodity index and two stock-benchmark families from Goldman Sachs Group Inc. Financial terms of the deal were not disclosed, the McGraw-Hill Cos. unit said. S&P is acquiring the Goldman Sachs Commodity Index, the Goldman Sachs Sector Indexes, and the Goldman Sachs Technology Index, and six technology sub-indexes, according to a statement.

Cometosewtic reverse head and shoulders#1518172/6/07; 08:05:33$WTIC&p=D&b=3&g=0&id=p23774335652

Jimmy Rogers made some commentary recently on "when oil corrects" .....

Today or yesterday WTIC crossed over its 50 dma ....

If crude is a bearing on the outcome of the precious and
If symetry plays out in this reverse head and shoulders
chart pattern sizing up in WTIC

THe road to the races might be a little subdued until after tax season is over

........that is barring any mitigating circumsatances and there could be many ....which might cause CRUDE RECOVERY to launch in an unprictable manner ....independenct of TA indicators

Thats my ground hog analysis .... perhaps 2-3more months of consolidation in here

We can also anticipate and look forward to the prospect of those MITIGATIONS....dropping by

Rookbezzle#1518182/6/07; 08:07:44

You already know about the unregulated derivitive issues, my question is, have any of you come across any logics, or come up with your own, on the subject of, well, I know some make the case of why haveing these financial instruments is good for us at this point, but what is the planning by the big boys for after a financial -accident-?
The fed must have come to some figureing before they went the road of derivitives this way. OK, perhaps they saw it as a way to extend fiat, but a breakdown must have been assumed by them as happening eventually, so what does that foresight consist of? What is it that allows them to so casually steer a planet full of people in this risky way?
Putting aside "madness", as an explanation, or -blind greed-, and assuming that they are not just "winging it", my limited (to qoute from the movie Madagascar,) "the brain type thingees in my head" cant see their thinking.

"Hedge funds – as the Long Term Capital Management meltdown showed us in 1998 - are almost entirely unregulated since there is no regulatory body either with access to data in relation to their transactions (particularly "off-exchange") or with the capability to take enforcement action over off-shore entities typically used by hedge funds.

Due to the lack of transparency in "off-exchange" trading, oil producers and consumers do not even know that they are losing - a phenomenon which J K Galbraith memorably described as the "bezzle". However, while oil producers and consumers have now woken up to the bezzle, the problem they have is what they can do about it."

TownCrierEurosystem Reserves#1518192/6/07; 08:08:41

During the past week one Eurosystem CB was a gold seller under the terms of the CBGA while another was a buyer of gold coins. The net result was a decrease in Eurosystem gold and gold receivables by a value of 39 million euro.

Meanwhile, the net position in foreign currency was allowed to decrease by a value of 100 million euro.

Gold reserves stand at EUR 176.7 billion.
Foreign currency stands at a new low of EUR 145.3 billion.

Although the next MTM operation is not until March 30th, were it to be done today the value of those Eurosystem gold reserves listed above would jump a further 5% higher based on gold's price gains since the previous revaluation one month ago.

For a brief overview of the recent (prior three weeks) activity regarding the significant ongoing discharge of foreign paper (-3.4 billion), look at last week's update at the given archive URL, and scroll to

TownCrier (1/30/07; 12:44 - msg#: 151641)


mikalStorm shelters and gold#1518202/6/07; 09:29:14 Merrill sounds alarm on global liquidity | Business | Money | Telegraph | Ambrose Evans Pritchard - 2/06/07
Flatliner@Rook#1518212/6/07; 09:50:08

It's hard to get your complete context with no referencing of sources. Are you quoting yourself in yesterday's postings?

It is interesting that when we look, we see the train racing towards the end of the track that hangs over a bottomless ravine. Surely, it will eventually meet the end of the line and there will be a tragic, emotionally packed, fiery show that all others had no idea they'd bought a ticket to see. But, seemly, the end of the track is continually extended through application of derivatives as they constantly come into play skewing the time-space window that we look through. Derivatives, held by someone that is legally accountable and subject to punishment, are treated completely different than derivatives held by those that are unaccountable (the big boys). The motives of the unaccountable can clearly been seen directly related to the business cycle, or the milking of the populous, but more importantly as a tool to make things ‘appear’ as if they are functioning correctly.

My advice is to watch the derivatives with a keen eye towards how they are applied and how they function but know that when the system really does start to breakdown, it will be like turning up the pain level for the average Joe. Life will get harder and the average Joe will tearfully give up what he thought was his hard earned assets because of legal debt obligations that he will not be able to afford. To prepare, position yourself to reduce you legal obligations and increase your store of non-derivatives. When the price of gold jumps, the rest of the world effectively deflates against the metal. If a house price jumps from 350k (@ 538 ounces gold), to 450k (@ 150 ounces gold) you're going to be in a position to go investment shopping for the next bull market if you're holding metal.

Time is on the side of he who sees that derivatives are used to hold commodities down and functioning. As long as derivatives do this, one should gather the undervalued commodities as an investment option. But always, get out of debt to free yourself from undesirable obligations .

R PowellFlatliner#1518222/6/07; 10:42:23

"Time is on the side of he who sees that derivatives are used to hold commodities down and functioning."


Many who trade in the above-board, transparent derivatives markets wonder how much the prices of many commodities (including precious metals) have been inflated (as opposed to held down + functioning) with the increasing influence of huge amounts of capital invested by the "long only" commodity funds. These relatively new to the commodity markets buyers have probably skewed prices enough to have become a market metric all by themselves.

Flatliner@R Powell#1518232/6/07; 11:12:56

I guess when I think of derivative players, I think of commodity funds along with those that counter commodity funds. For every player there is a counter player. What is the counter player's motive?
TopazYield:DX#1518242/6/07; 11:57:10

A comparison is slightly non-valid as one is linear, the other exponential however, what IS valid is the "current-future" correlation of Comex (Paper) Gold with one OR the other (Y or DX)
Sooo ...we are quickly approaching that point in the month where "current" Gold succumbs to quazi-future pricing as the deliveries get done.
What this will (imo) mean is Gold will give up on tracking (or reacting to) DX (current) and will instead track (future) Yield.
If Europe has it's way, this will mean Gold:Yield will rise, as will DX however, US interests seem intent on Yield:DX dropping will imo Gold.

Good news? ...Ag:- Our Sword of Damocles represented by the cloud build-up at (roughly) 48 on the Au:Ag ratio chart needs to be resolved. I'm thinking a "reasonable" outcome might find it at high 30's within a month.

Educated guesswork ...totally not applicable if wheels fall off.

mikal"Leveraging up" and high PE ratios leave equities vulnerable to 'credit crunch'#1518252/6/07; 13:12:30

Market Insight: Danger of equities being infected by risk mispricing
By Tony Jackson
Published: February 5 2007 18:31 | Last updated: February 5 2007 18:31 -- Snippits:
"The past few weeks have brought a drumbeat of warnings from central banks and regulators about the dangers of a credit crunch – or a "reappraisal of risk", as one of them more delicately put it. The odds of such an event or its timing are unknowable. But what would it do to other asset classes, equities in particular?
Before we get to that, notice that those august bodies have something of an agenda. Central banks cannot individually control the tide of global liquidity that is so deforming the credit markets. And neither they nor the regulators know where the risk is sitting in the financial system, so they cannot control that either. Their subtext, therefore, is: if things go pear-shaped, don't blame us. We did warn you...

The real worry is that last year it was widely assumed that big public-to-private deals were off the table: that the investing institutions had been been burnt too often.
Now that idea seems to have been dropped. Any stock is a bid target again.
If so, stocks will increasingly be priced according to the risk levels underlying the Sainsbury proposition. For many months, the credit markets have been asking – begging – for trouble. It would be a pity if equities wound up doing the same."

968Dollars and Politics #1518262/6/07; 13:13:42


"The performance of the US economy in the 20th century owes much to the predominant role of the US dollar in the international monetary system, and a large part of attaining this role was the result of the political and military supremacy that the United States had gained after World War I. The position of the US dollar in the world today represents a major underpinning of the prosperity at home, and provides the basis for the expansion of the US military presence around the globe."

Flatliner, any thoughts on this article ?

Thoreauly"Nightmares of a Central Banker"#1518272/6/07; 13:19:28

"When economic systems grow in complexity and diversity, central planning and interventionism become exponentially inefficient, and the need arises for more decentralized coordination mechanisms. Modern economies, and in particular modern financial markets, have become too complex for active central banking. Monetary policy cannot be improved by more research and better central bankers. What is needed is something quite different: a monetary system that can do without an active central bank."

Gee, I wonder what THAT would be.

HenriMikal Msg 151820#1518282/6/07; 13:48:34

When Merrill puts out a statement like that, you can pretty much bank on the alternative scenario. What they are saying is that the liquidity of industrial metals stock is drying up and they can't get enough in size to satisfy their "good" clients. Just trying to free some up...for purchase.
Flatliner@968#1518292/6/07; 14:05:03

Spot on, if viewed from a particular vantage point. My lazy boy, non-educated, internet theorized point of view is that the ‘prosperity at home’ is directly related to the function of the dollar in Open Public Markets around the world. The function of the dollar in Open Public Markets is enforced by laws, and more importantly, backed up by the military. Because dollars support the military, a strong dollar empowers a military that can enforce dollar settlement (circular). Ultimately, the forced function of using dollars as the settlement currency completes the function of the currency – much like income taxes do for local currencies – that gives the inflation taxation power to the dollar controllers and leaves everyone else feeling shafted through taxation without representation.

Now I will apologize, for the paragraph above came into being before venturing off to read the article. It is now time to follow the link and see if there is something new for me to learn.

Chris PowellCommodities were up but somehow Goldman's index for them was down#1518302/6/07; 14:25:59

Goldman Sachs Sells Top Commodity Index

By Kevin Morrison
Financial Times, London
via Yahoo News
Tuesday, February 6, 2007

Goldman Sachs has agreed to sell its GSCI commodity index to Standard & Poor's for an undisclosed amount.

The move will give S&P a potentially powerful influence on commodity markets as any changes to the index composition can have wide ramifications for underlying commodity prices.

The GSCI, the world's leading commodity index, has about $60 billion tracking it. Most of these funds are managed by Goldman, which is the largest commodities trader among investment banks. The management of these funds will not change as a result of the transaction. Funds trading the index have become the most popular route for investors wanting exposure to commodities.

However, the GSCI underperformed last year, falling about 15 percent, even though most of the 24 commodities in the index recorded a price increase. The fall was mainly attributable to the higher forward prices for crude oil futures versus the spot price. This meant investors rolling forward their exposure to oil futures had to pay more than the price they received for selling the spot contract before expiry. This is known as the negative roll yield.

The GSCI, which was launched in 1991, under-performed against other commodity indices including those provided by Dow Jones-AIG and Deutsche Bank.

"The sale of the GSCI is a strategic decision to reduce our management of indices. It has nothing to do with the underperformance last year of the GSCI," said Goldman Sachs.

Last year, Goldman Sachs attracted criticism for the reconfiguration of the GSCI when it dropped the Nymex unleaded gasoline futures contract and did not replace it immediately with another gasoline contract.

The change was a big factor behind the steep fall in the price of unleaded gasoline, which accounted for more than 5 per cent of the GSCI before its exclusion.

David Guarino, a spokesperson for S&P, said it had no plans to change the configuration of the index, which has been criticised for being too weighted towards the energy sector.

Goldman will also sell its sector indices for healthcare, financial services, utilities, consumer companies and cyclical industries and the Goldman Sachs Technology Index. Goldman will license the GSCI from S&P so it can continue to provide investment products to clients based on the index. Licensing of the GSCI is the only revenue stream for the index.

S&P, best known as a credit-rating agency, said that once the acquisition was completed, it would not continue its two existing commodity indices.

mikal(No Subject)#1518312/6/07; 14:47:16

Europe Suffers Worrying Wave of Financial Chaos: Matthew Lynn
July 5 (Bloomberg) --Excerpts: "First Iceland. Now Turkey. And Hungary is looking wobbly.
Europe is increasingly encircled by financial woes. Its emerging markets are being hit by a wave of speculative selling, pushing currencies into freefall, and prompting big increases in interest rates.
The worrying questions now are: Will those crises turn out to be contagious, as they did in Asia in the last decade?
And, if that is a risk, is there anything the rest of Europe should be doing to support those economies?"

"European Contagion
True, by the end of the week the markets were rallying as it looked as if the Federal Reserve may be coming to the end of the current round of interest-rate increases. And while all the emerging markets have been volatile, it is around the peripheries of Europe that the worst of the turmoil is being felt.
For the rest of Europe, trouble in markets such as Iceland, Turkey and Hungary has two important consequences.
First, it might be contagious.
In the Asian financial crisis of 1997, crashes rippled out from one country to another in a domino effect. As investors lose confidence in one nation, they start to question the finances of another. Very quickly, a whole region is in trouble.
There are plenty of differences between the Asian crash almost a decade ago and the volatility of the past few weeks --yet there is little doubt that a domino effect is emerging. When will it stop? Nobody can say for certain...

Intervention in the markets is notoriously tricky. It ends in failure more often than not. The trouble is, doing nothing may not be a very attractive option either."

Chris PowellClive Maund: Gold is probably manipulated but I don't care#1518322/6/07; 15:23:42

5:20p ET Tuesday, February 6, 2007

Dear Friend of GATA and Gold:

Gold market and technical analyst Clive Maund's new commentary asks the musical question: "Gold price manipulation -- Does it matter?" He concludes that the answer is no more important than whether the chewing gum loses its flavor on the bedpost overnight.

But Maund's commentary itself is important for signifying that manipulation of the gold market is increasingly accepted as a given by analysts, if only grudgingly, since, of course, manipulation makes a mockery of analysis and analysts alike. Indeed, technical analysis of a manipulated market is worthless if it takes no account of the manipulation. That is, despite their conscientiousness, people like Maund have been largely wasting their time.

In his new commentary Maund sounds just like another technical analyst, Dennis Gartman of The Gartman Letter, who even just a few days ago was not only expressing indifference to manipulation of the gold market but also was arguing fatuously that suppression of the gold price should be welcomed by gold advocates and investors because it gives them a chance to accumulate more metal at a discount. Of course this opportunity does nothing for those who are already fully invested in gold and shares of gold mining companies and want fair valuation of their investment now. Nor does this opportunity avail those gold investors who will die today or tomorrow or soon after having been long deprived of fair value for their investment. For manipulation of the gold price expropriates ALL gold investors EVERY day.

Maund writes that the gold price suppression scheme is sure to be beaten by the market eventually. Maybe, but eventually really isn't soon enough. And Maund fails to note the purposes of the gold price manipulation outside the gold market -- the deception of investors in stocks, bonds, commodities, real estate, and everything else.

Those who have been exposing the manipulation of the gold market may be glad that Maund is coming around a bit. But it's really not enough if Maund himself is starting to figure things out. There's still a whole world that may not be as complacent about its screwing as Maund is.

In any case, you can find Maund's new commentary at GoldSeek here:

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

USAGOLD Daily Market ReportPage Update!#1518332/6/07; 15:26:05">
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 6 (Reuters) -- U.S. gold futures ended higher for a second straight day on Tuesday, boosted by a weaker dollar, rising oil prices and a firmer base metal market, and traders said the precious metal could retest its peak reached last week.

Most-active gold for April delivery on the COMEX division of the New York Mercantile Exchange settled up $2.60 at $658.70. The contract hit a session high of $663.70 in the morning as U.S. crude oil touched a one-month peak of $59.99 a barrel. However, gold later erased early gains as it dipped as low as $653.0.

Greg Weldon, chief executive of, attributed gold's pullback to the dollar's weakness. "The global monetary situation right now remains very stimulative to gold," as a result of the lower short-term rate environment and increased money supply and credit for many economies around the world, Weldon said. Weldon also cited the weaker interest rates of many currencies compared with the U.S. dollar.

"That really does provide the impetus for people to want to own gold," he said.

The euro extended its gain against the dollar by midafternoon, while the Japanese yen slipped after U.S. Treasury Secretary Henry Paulson said the yen's value is set by market fundamentals, suggesting the U.S. government sees no problem with the yen's weakness.

An ailing dollar tends to prop up dollar-denominated assets like gold in overseas markets as speculators take advantage of price differentials.

"We were up with the strength in crude (oil) this morning and with the strength in base metals as well and the weakness in the U.S. dollar. They all were contributors to our upside momentum," said one COMEX floor trader.

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

TownCrierDundee economist Murenbeeld says dollar diversification will turn to gold#1518342/6/07; 15:30:02


CAPE TOWN ( -- Respected metals price and currency forecaster Dr. Martin Murenbeeld Tuesday predicted a stronger gold price in 2007, an overvalued U.S. dollar currency, limited supply and higher gold investment demand.

During a presentation at 2007 Mining Indaba in Cape Town, Murenbeeld, Chief Economist of Canada's Dundee Group, forecast a 2007 gold price ranging from $674 to $707 to $755 per ounce.

He asserted that the U.S. dollar exchange rate was significantly overvalued, ranging between 15% and 35%...

He asserted that international U.S. dollar reserves were excessive as $4.8 trillion in currency reserves were estimated to be held globally. Asia now holds more than half of the world's currency reserves.

"Diversification from U.S. dollar reserves would do wonders for the gold price, even if Asia does not increase their gold investments to an unlikely 15% of reserves, but only decides to buy a portion of the 500 tonnes of gold annually available from the Central Bank Gold Agreement (CBGA)," Murenbeeld said.

Also supporting the gold price is OPEC's current account surplus that is rising – putting great pressure on the organization to diversify...

"Indications are that there will be further diversification away from dollars, as there are fears of further dollar currency declines and geopolitical trends, such as anti-US sentiment in the Middle East, do not exactly support the currency," Murenbeeld explained. "But other markets are not cheap, and gold is now cheap at ten barrels of oil for an ounce and in terms of the cost of financial assets."

U.S. monetary policy is likely to be eased in future, as budgets are stretched as the baby boomers retire, causing fears that the US economy will slow down, he said.

Murenbeeld said that gold price cycles generally lasted a minimum of 10 years, and that he was bullish on the price for at least the next four years. However, he cautioned, that one had to remember that a counter year occurred in each 10-year cycle...

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

No comment.


mikal(No Subject)#1518352/6/07; 16:11:57

Another nail in the US dollar's coffin
By Jephraim P Gundzik - Feb 7, 2007 - Snippit:
"Growing political instability in the US will weigh heavily on the dollar during 2007. This weight, combined with growing political pressure for dollar devaluation and a slew of negative economic factors, is likely to prompt significant dollar depreciation against most other currencies. The dollar's decline will help send asset values in the US sharply lower and precious metals prices soaring."

gemiscellany#1518362/6/07; 16:51:54

Russia, Iran, Qatar to Assess Need for Gas OPEC in March

War on energy currency continues
U.S. to create new military command for Africa

Resource wars - Obviously targeting Chinese entry to Africa

China, Africa, and Oil
New Russian Oil Pipeline to Bypass Belarus

"The crisis ended on Jan. 12 with a deal in which Russia agreed to cut the duty on oil exports to Belarus, while Minsk promised to share with Moscow a substantial amount of the profits from the refined oil products it sells to Europe. However, as MosNews has reported on Monday, Minsk decided to raise oil transit duties for Russian oil by several times, making export of crude through Belarus economically unfeasible."
Head of Russia's Largest Oil Company Says Crude Exports Must Be Stopped

"The president of Russia's largest private oil company Lukoil said on Tuesday, Feb. 6, that all Russian crude must be refined inside the country."

R PowellFlatliner#1518372/6/07; 17:45:09

"What is the counter player's motive?"

My understanding of the markets; there are many producers and endusers who buy or sell commodities (including the precious metals) in order to lock in profits OR control costs + expenses. True hedgers do NOT look or expect to profit from futures or derivatives.

Everyone else is there to make money. Those "long only" funds that I refered to earlier hold long positions + will continue to do so until + unless investors withdraw funds.

Rook.,.#1518382/6/07; 17:52:55

Thanx Flatliner, the quotes were not mine, you have to be right, in the murk of the derivitive world, the big boys will watch out for themselves.
Chris PowellCommodity supplies in doubt as developing countries can't settle mining law#1518392/6/07; 18:15:59

Indonesian Mining Stalls

Disputes Over Control
Halt Development Steps,
Pressure Commodities

By Tom Wright and Patrick Barta
The Wall Street Journal
Wednesday, February 7, 2007

JAKARTA, Indonesia -- Indonesia has some of the world's largest reserves of gold, coal, nickel, and other valuable commodities, many of which have seen their prices soar in recent years. Yet mining companies haven't broken ground on a single large new mine here since Asia's 1997-98 financial crisis.

The reason: a fight between national and local authorities for control of the country's natural resources. That battle, part of a wider struggle for local autonomy in Indonesia, could have important implications for global mining companies and world commodity prices in the years ahead.

Indonesia isn't the only country that's struggling to get mining projects on track. Other promising mining centers, including Mongolia and the Democratic Republic of Congo, are confronting similar debates over who should benefit from resources.

Whether these countries can get new ventures under way will be crucial in determining if commodity prices remain high for several more years or continue slipping as some have in recent months. Copper, for instance, is down more than 25% over the past six months, in part because of expectations of weaker global economic growth, though its price remains high by historical standards.

Opening more of Indonesia's major deposits could add significant new commodity supplies to the world market, especially for in-demand raw materials such as nickel and coal. Rio Tinto Ltd., for instance, wants to build a $1 billion nickel mine on Sulawesi island, and estimates output could reach 46,000 metric tons a year. A large development like that could help reduce pressures at a time when nickel is near record prices. But the development remains on hold as Indonesia tries to resolve its regulatory problems.

Mining has been one of Indonesia's top industries for foreign investment, and the windfall from selling rights and taxing profits on new mines would be a badly needed economic boost -- if the country can just determine who gets the proceeds.

For more than 30 years, there was little to debate. Indonesia's authoritarian former leader, President Suharto, kept a tight grip on mining, selecting foreign investors and setting royalties and taxation regimes by decree. Investors such as Freeport-McMoRan Copper & Gold Inc., a U.S. company that in the 1970s began operating one of the world's largest gold and copper mines in Indonesia, enjoyed the certainty of this system.

But after Mr. Suharto was driven from power in 1998 and democracy was established, local authorities across the 4,800 kilometer-long archipelago of more than 13,000 islands began to demand a larger share of the wealth generated by minerals, oil, and gas.

The resulting friction between Jakarta and outlying regions has increased uncertainty over who is in control, deterring foreign investors. In some areas, small-scale mining operations mushroomed without central government sanction, and some provinces levied illegal taxes on mining projects, the central government says.

The central government has been trying to finalize a new mining law it hopes will settle such issues. But the process has bogged down amid disputes, many of them revolving around whether the central government or local governments closer to the resources should set terms and conditions for mining operations.

Politicians concede the law is now unlikely to be enacted by Parliament before the end of 2007. The draft law is now before a parliamentary committee, which has discussed only about a fifth of the bill's 414 provisions since it began deliberations in January last year.

In the meantime, Indonesia's mining industry "is going nowhere," complains Priyo Soemarno, executive director of the Indonesian Mining Association, whose members include Rio Tinto as well as other foreign and Indonesian companies. "We need somebody strong to say, this is right, this is wrong," to provide clarity for mining companies. "It has to be done quickly."

As politicians squabble over the law, international mining companies are keeping potentially large projects on hold. This includes Rio Tinto's nickel venture. The law could also affect BHP Billiton Ltd., which is considering developing two new coal mines on the island of Borneo.

The delays mean Indonesia is missing out on a golden opportunity. Mining companies spent a record $7 billion on exploration globally in 2006, Metals Economics Group, a Canadian advisory firm, said in a report. Countries such as Russia and China attracted significantly greater levels of investment than in previous years, the report said.

By comparison, exploration outlays in Indonesia have dwindled. Before the Asian financial crisis, local and foreign companies spent an average $40 million each year on exploration for new mines in Indonesia, according to PricewaterhouseCoopers. That figure had slumped to $7 million by 2004, a tiny fraction of the $1.6 billion spent that year on new mine exploration.

Since President Susilo Bambang Yudhoyono took office in 2004, he has tried to cut Indonesian red tape and attract more foreign money to the resources sector. He has made some headway, most notably in resolving a prolonged deadlock between Indonesia's state oil company and Exxon Mobil Corp. to develop the $2 billion Cepu oil field in Java.

But mining executives and analysts say Mr. Yudhoyono's efforts are being undermined in Indonesia's convoluted bureaucracy, a problem compounded by the unresolved power struggles between Jakarta and local governments. "There is a disconnect between what the leadership wants and what others want," says Alex Gorbansky, managing director of Frontier Strategy Group, a Cambridge, Massachusetts, advisory firm.

The draft version of Indonesia's new law would give provincial authorities the right in some instances to issue licenses directly to foreign investors and oversee mining projects.

Indonesia's Energy Ministry, which drew up the draft, says the law is in line with legislation passed in 1999 that devolved more political and economic clout to the provinces to reverse the steady accumulation of power in Jakarta during the Suharto era.

But critics, including some big foreign and local mining companies, fear giving power to local officials who lack expertise in regulating mining and have little knowledge of international commodity markets will make the system unworkable.

Leaving decisions to local governments would also give more power to Indonesia's expanding cadre of domestic mining companies, foreign and local miners complain.

Charlie Lenegan, a managing director at Rio Tinto, which began talks with the government in 2005 about the Sulawesi nickel project, says the tug-of-war between local and central authorities has created problems.

Rio Tinto, he says, has faced various tax requests from different layers of government, making it difficult to assess the overall costs of the project. The Anglo-Australian company would like to see a new draft law that allows large, foreign investments to establish individual, long-term contracts that settle outstanding issues related to a mine in a single document.

"We're saying to the government of Indonesia, you have to look at taxes as a whole package, not from multiple sources," Mr. Lenegan says.

The debate over who should control resources isn't the sole obstacle to foreign miners seeking unfettered access in Indonesia. In the case of Rio Tinto, the Forestry Ministry has declined to provide anything more than short-term permits for work in protected forest areas. The Energy Ministry says Rio Tinto should get the permits, but there is little sign the disagreement between ministries is close to a resolution.

otish mountainhow to turn pennies into gold#1518402/6/07; 19:00:51

Here is one economist's solution to the dilemma facing the US Mint regarding the intrinsic value of the 1 cent US coin exceeding its nominal value.
"The traditional solution since medival times is to debase the threatened coin, that is make it of a cheaper material.This cannot be done under current law and congressional action is required to redesign our coinage. Another solution is to discontinue the one cent denomination and rebase pennies to be five cents."
"The new value would be instantly established by the Treasury's standing ready to exchange 20 pennies for a dollar bill"
Author Francois R. Velde senior economist writing for the Chicago Fed Letter (pdf)

Rook.,.#1518412/6/07; 19:13:43

R.Powell, Thanks for your continued important imput. You mention derivitives used for commodities, I know I will reread your posts to more fully learn about that. I guess I have been reacting to the reading I have done on the debt derivitives. The trillions of that stuff that give so many writers the (again with the movie Madagascar..) heebe jeebies.
slingshototish mountain#1518422/6/07; 19:25:02

Pennies from Heaven. The throw aways not worthy to pick up off the ground. Twenty coppers to the dollar. Wow! Suddeny pennies will be worth something again but will the public see that the dollar is only worth 20 cents or less? Will they change rolls of nickles, dimes and quarters for pennies? Just having fun with this thought ;0)
Good to see you post.

I am looking at my penny jar. Hmmmm.


R PowellSlingshot#1518432/6/07; 19:56:33

That twenty pennies for a buck sounds great to me. My penny jar is what people used to call a steamer trunk, with a small hole drilled through the top. That's there so I can dump my pennies in without having to open the top. It is now, after decades of contributions, too heavy for one man to move.

I guess a much more favorable currency exchange rate is what precious metals (and pennies!) savings is all about, with the added value of having something of value for the unlikely event that a gold or silver coin is worth more paper than one man can move.

physicalmanr powell#1518442/6/07; 21:44:41

be glad to see em change pennies to nickels, (got 2-53 gal steel barrels full of wheaties plus 3 others full of newer pennies) could get me a heckuva nice piece of bottomland for the exchange rate to frn (federal reserve notes) but dread the rolling process to take em to local bank!!
GoldiloxDebasing the penny any further#1518452/6/07; 22:23:28

@ otish mountain,

"Law" is not the barrier to debasing the penny any further, as the FED RESERVE act proves. They can debase anything they want with enough clout.

The problem is two-fold.

1) There is no commodity left that can replace the current alloys cost-effectively. Most of the copper was already removed over 20 years ago.

2) The dollar has been debased to the point that it is no longer worth the effort to transact business at the granularity of 1/100 of a dollar - thus the "penny" trays in many retail businesses.

Hard to believe that in a Society "protected" by the FED inflation fighters, we are discussing the problem of "over-valued" coinage.

The only solution might be a third-world style dollar revaluation, that revalues the coinage on a different scale than paper and electronic assets, or discontinue coinage altogether. This fits well into the "electronic only" money dreams of the NWO and banksters. If "wealth" can only be defined by their "virtual decree", then only the "in crowd" will ever have access to it. Any dissenters will have their assets frozen and "confiscated" as contraband.

Who needs a Constitution once "permission to buy and sell" exists only at the "pleasure" of the Emperor? At that point, owning gold or anything without "state permission" could easily become "criminal", just as squatting on unoccupied land that was bequeathed to some absentee Noble by some Conqueror King still is in many parts of the world.

The media is darn quick to criticize Chavez for re-grabbing assets from foreign corporations, but mostly because he is voiding the usurous "contracts" that were initiated by the IMF and their "economic hitmen" to do the same thing themselves. "Do as I say, not as I do".

It's true that he is offering no "ownership" solution. We probably shouldn't expect it, since the foreign corporations and colonial churches have helped themselves to third-world land and resources for centuries, placing their own corrupt military dictatorships in power to maintain "lawn order". It's "business as usual".

otish mountainTipping Point#1518462/7/07; 00:27:19

Agree with your last post and have pondered the horrors of a cashless society.
We all watch intensely for a sign or indictions of the crumbling of our financial system. Study hedge funds, derivatives, watch currencies, price of oil, wars. How ironic it would be if the lowly penny was the catalyst which causes the cascading of a currency melt down.

Hey Buddy still here most everyday. Take care.

TopazEuro: Dollar.#1518472/7/07; 00:46:21

Some serious "management" going on this eve in e-Bond
land as Euro fends off a run at 1.30. Gold caught up in the crossfire as of this. Will come out the other side smiling I think.
No biggie!

GoldiloxTipping Point#1518482/7/07; 01:01:07

@ otish moutain,

The penny, IMHO, is no tipping point, as the issue revolves completely around the "value", or lack thereof, of the dollar itself.

I see it more as an important warning sign along the trail. We've seen the same thing in other coinage: 50 Peso pieces, $20 gold pieces, silver dollars and fractions, etc.

If we think electronic voting machines can empower some nasty shenanigans, wait until you see the opportunity for abuse in a completely electronic marketplace - especially one where encryption is outlawed, without first giving some "authority figure" the "keys" to the back door.

Gold may well offer the option to be a "criminal currency", but unfortunately, that is BECAUSE it offers the alternative of a free, non-virtual wealth, NOT just an expression of someone else's power over society.

Just as 100% freedom is only found in chaos, 100% security is only found in complete subjugation. Where on that curve are we heading?

White RosePrediction on war with Iran#1518492/7/07; 05:03:49

my own prediction: US will launch war with Iran on Feb. 16th 2007 at 6:15 pm.

There is a new moon from Feb 15th through the 18th. Friday at 6:15 pm is the point of maximum dis-array of the Eastern Establishment. At 15 minutes before the "nightly news" broadcasts, the news people cannot do anything except say that "war is on". It takes until Sunday morning until the pundits can gather. The weekend makes it difficult to raise voices against the newest war over resources.

Using logic like this, I was able to predict the exact time to the minute of the start of Iraq War I.

Fasten your seatbelts. This one will be a very rough ride. When it is all over, it will probably be treason to say it was all a mistake. Let me take the opportunity to say so now.

AdvocatusPrediction on war with Iran#1518502/7/07; 05:16:57,7340,L-3360816,00.html

@ White Rose

War with Iran? Rumsfeld is out and Cheney is down. Aside from some token rethoric, the recent and novel policy statements of the White House signal diplomacy and a libertarian economic bent. Ron Paul should be proud.

Besides, who would want to attack the chaps that are about to announce a cure for AIDS? See the link above. Well, OK, the Israelis maybe:

968@ Flatliner msg#: 151829#1518512/7/07; 05:20:57

If this is the case, this implicates that a discussion about the international monetary system and gold is a 'political discussion' ?
Noble1Bandidas#1518522/7/07; 06:33:03

Rented this movie the other night where Selma Hayek and Penelope Cruz play Mexican Robin Hoods who have been successfully robbing Mexican banks that have been taken over by American counterparts and stealing farms from the people. The American bank convinces the Mexican Governor to move its gold to Texas for safety. Penelope (the farm girl) tells Selma that its OK that they move the gold because "we'll have all the money". To which Selma (the European educated sophisticate) responds that it's the gold that gives the money value---without the gold its just paper-stupid.

The writers must have been reading USAG. Anyway it was nice to see this concept on the screen. The more seeds that are planted, the more crops that will grow.


Chris PowellMiners march in Bolivian capital to protest tax increase#1518532/7/07; 06:54:12

By Dan Keane
Associated Press
Tuesday, February 6, 2007

LA PAZ, Bolivia -- More than 20,000 miners from across Bolivia marched into La Paz on Tuesday, tossing bits of dynamite that sent booming explosions echoing through the streets in a protest of President Evo Morales' plans for a steep hike in mining taxes.

The hard-hatted miners whistled and chanted as they filed through the center of the capital city in the protest against the tax proposal, which they say would unfairly burden hundreds of small independent miners' cooperatives.

Police said they had confiscated some 284 sticks of dynamite from the protesters, along with hundreds of detonators and rolls of fuse -- all sold in Bolivia without restrictions.

After negotiations with the miners Monday night, the government announced that the cooperatives' taxes would be frozen at current levels until further notice. The proposed tax increase would be directed instead at larger private mining companies operating in Bolivia, officials said.

But the concession failed to deter the thousands of miners already gathered in La Paz's poorer twin city El Alto from marching down the hill into the capital Tuesday morning.

The tax freeze "seems reasonable to us," Interior Government Minister Alfredo Rada said at a news conference Tuesday. "We hope that this proposal will not continue to be met with intolerance and irrational actions like those of the cooperative miners this morning."

The miners' cooperatives argue that the government should not penalize their labor with higher taxes but instead focus on the mineral dealers who buy and sell their ore.

"We have asked the government not to impose this tax," Andres Villca, leader of National Federation of Mining Cooperatives, known by its Spanish acronym Fencomin. "Instead, we have asked them to look for a way to control the sale of the minerals, which is the fundamental part."

Rising international metal prices, fed in part by spiraling demand from China, have doubled the value of Bolivia's mineral exports, from $547 million in 2005 to over $1 billion last year, with cooperatives accounting for just over a third. The metals -- mostly zinc, silver, gold, and tin -- together represent Bolivia's largest export after natural gas.

But the Bolivian government collected only $45.5 million in mining taxes in 2006 and aims to dramatically increase its collections this year, perhaps to as much as $300 million.

The proposed tax increase is a first step toward Morales' announced goal of "nationalizing" Bolivia's mining sector, though how the process will proceed beyond the tax increase is unclear.

Bolivia's extensive mineral deposits are already owned by the state, which operates a handful of mines through state mining company Comibol. The rest are mined through concessions granted to the cooperatives or to international companies such as U.S.-based Coeur d'Alene Mines Corp. and Apex Silver Mines, Limited.

Morales has said that any concessions left idle or lacking in investment should be returned to the state.

USAGOLD / Centennial Precious Metals, Inc.The Fruits of your Labor: Exchange today's harvest for timeless value!#1518542/7/07; 07:26:01

Swiss gold francs

Whatever it is that you may have sown,
we'll give you the power to reap GOLD.

USAGOLD-Centennial has over three decades of experience in the field!

AdvocatusBroadening the monetary base beyond US borders#1518552/7/07; 07:45:10;_ylt=Av7gdHW2aTiIYET3IakldLPMWM0F;_ylu=X3oDMTA3ODdxdHBhBHNlYwM5NjQ-

Spread the inflation tax to the corners of the empire the crude and simple way: just fly out loads of cash.
TownCrierAdvocatus, thanks for sharing the article#1518562/7/07; 08:41:12

"The U.S. Federal Reserve sent record payouts of more than $4 billion in cash to Baghdad on giant pallets aboard military planes shortly before the United States gave control back to Iraqis..."
"Bills weighing a total of 363 tons were loaded onto military aircraft in the largest cash shipments ever made by the Federal Reserve..."
"The money, which had been held by the United States, came from Iraqi oil exports..."

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

This very effectively illustrates how the "exorbitant privilege" exists in which the U.S. has been able to simply print (limitless supplies of) its own money to balance/offset our trade deficit from our net-surplus imports of goods and services.

Without requiring too much thought, you instinctively know that this political asymmetry will not be tolerated by the rest of the world forever. And in fact, change is already underway...


SurvivorQuick Question#1518572/7/07; 10:05:54

Anyone know . . . Does it cost more than 5 cents to produce a nickel?

- Survivor

Cage Rattler360 tonnes of $100 bills#1518582/7/07; 10:12:19

Do the reported numbers add up? Following the maths below, 360 tonnes is approximately $36 billion which is far more than the numbers cited in the Reuters article mentioned in a previous post below.

Excerpted from the 3/31/97, Monday Business Section of the Washington Post:

Just how big is $20 billion? Here are two creative ways of visualizing the size of this wealth. First let's weigh the money. To make the weight more interesting, lets weigh $100 bills. A friend of mine with a scientific scale tells me that $100 bills weigh about one gram each. It takes just a few steps to calculate how many tons of $100 bills there are in $20 billion.

There are 200,000,000 one hundred dollar bills in $20 billion. For simplicity sake, let's say that 500 grams equals one pound. Dividing 200,000,000 by 500 gives 400,000 pounds of $100 bills. Dividing this by 2000 pounds/ton gives 200 tons of $100 bills.

Flatliner@968#1518592/7/07; 10:27:55

968, you have shared much in this forum over the years so it will be interesting to see exactly what is slowing unfolding through your questioning. I am always up to learn something new.

Looking closer at your conclusion, I would say that I lean more towards any discussion about currency or the PoG is a political discussion. It seems that there is a clear direct political (or business) relationship between a government and its central bank over the issuance of the state controlled currency. The right to loan currency into existence is so tempting (and dangerous) that is would seem that the politicians would want unlimited creative powers while a banker ‘might’ want a non-political backing to provide stability for business function. We witness this display during every Fed meeting and it's overlooked that the banker always seems to point out the dangers of the political situation that threatens the currency. Likewise, bankers around the world clearly demonstrate the power of gold by holding it on reserve even though it gathers no interest. The bankers are well aware of the Strong Dollar Policy that is a political desire and know that marking their gold reserves (or nationalized resources) to market provides a counter balance to boundless currency creation (by the state). The State, knowing that gold functions as competition for the controlled currency, will do everything that it can to discredit conversion, out of the currency, into gold. Thus the PoG is carefully monitored to make sure the currency monopoly is not lost. The best defense in this area is much like interest rates – short the paper gold market and take a loss in order to maintain function of the currency which is worth Trillions (as seen with the latest ‘on the books’ budget from the executive branch). Currencies are created by politicians and executed through banks. I would say that politics plays a very big role with regards to how the currency is perceived and how it functions.

The article that you pointed to yesterday is a good read. There is a lot in it that seems to match what I have learned and observed.

"It is not economic strength that provides the foundation of the role of the US dollar in the international monetary system, but it is the US dollar's role that provides the basis for the United States to maintain and extend its global activities."

"While after the two world wars, it was the US industrial base that laid the foundation for the role of the US dollar, now it was not the superiority of the US industrial base that provided the basis for the global role of the United States but its insatiable appetite for private and public consumption."

"While other countries have to export in order to pay for their imports, the sovereign who emits a global currency is exempt from adhering to the most fundamental law of economic exchange. This sets domestic resources free for the expansion of the state, particularly military power. The more such an imperial power extends its military presence around the globe, the more its currency becomes a global currency, and thereby new expansionary steps can be financed. Expansion becomes a necessity."

This last paragraph brings up a good point, the privilege of the global reserve currency benefits the state through its ability to fund the military and the military is strategically controlled by politicians through the right to declare war which will support the interests of the country around the world.

To me, one of the biggest political stands a person can make is to convert into gold – or out of gold into a currency. That is truly voting with your pocketbook. If you like the management of a currency, buy it with your gold. If you don't, buy gold with that currency. Just like companies that have good or bad managements, the stock exchange value is correlated. Management that is good will see more future value, management that is bad will see less future value. My observations show that dollar management has been extremely strong (against gold) but is starting to break down. If the management continues as it is, we will see a mild increase in the currency/gold exchange. If management breaks down more, we will see a higher increase.

So, it would seem to me that, yes, understanding politics is vital to understanding currencies and sense gold is exchanged for currencies, one should expect gold should experience political influences. Sorry for the long winded response.

Flatliner@Survivor#1518602/7/07; 10:30:27

If this helps, conflation gives the metal value. I'm sure the treasury has overhead on top of this.
GoldiloxCash weight to Iraq#1518612/7/07; 10:31:37

Given that they probably sent mixed denominations, the actual amount must fall somewhere between $360M (all $1 bills) to $36B (all $100 bills) to fit the given weight parameters.

That's a lot of trees, in any instance.

otish mountainmelt value#1518622/7/07; 10:36:27

Linked is a calculator and as of Feb 06 the US 5 cent piece had an intrinsic value of 6.85193 cents.
Of course what is not calculated is the minting costs which would increase the price to produce as well.

GoldiloxTons of dollars and ATMs#1518632/7/07; 11:15:07

It's interesting that given our approximations, one ton of $1 bills equals a cool $1 million. It makes the conversion to $5, $10, $20 and $100 denominations into pretty simple arithmetic.

I wonder when (or if) the $1000 bill will be re-introduced. "Small bills" are getting to be quite a wad in the wallet, but of course, bankers would prefer us all to use "Mylar Money", so they can skim their 2-4% on EVERY single transaction.

Many retailers, like ARCO, pass on a "debit card fee" at the register, and as we all know, ATMs also charge "convenience fees" for non-members.

Retail "processing fees" are not cheap, either, so strong volume is necessary to amortize these across many transactions.

contrarianIran?#1518642/7/07; 11:40:12

Advocatus and White Rose--
I would only comment...think about the significance of how recently on CNN, for the first time, we were treated to the spectacle of dead soldiers returning from Iraq--ostensibly killed in Kabul with involvement by Iran. And how all pictures of returning caskets from Iraq have been suppressed until now. I think that, more than anything else, may be a harbinger of what is to come.

Also, one may learn also more by what is NOT said than what is said, or what is NOT done rather than done. Then note how Brezinski's recent important and extremely significant testimony on Capitol Hill was completely ignored by the major media.

But then you don't expect them to proclaim a major gold bull market to the high heavens! 'Nuf said!

GoldiloxKabul#1518652/7/07; 11:52:27

@ Contrarian,

"soldiers returning from Iraq--ostensibly killed in Kabul with involvement by Iran"

Isn't Kabul in Afghanistan, not Iraq?

Sounds like they were either in the "clear the way for the Condi's pipeline" or the "protect Ollie's poppyfields" assignments, not the "liberate Iraq" assignment, although with 720 bases in 130 countries, it's difficult to keep the "theaters" straight.

Henrihmmm#1518662/7/07; 11:57:52

The reason we are in IRAQ is to assure that the current govt stays in power because they are giving the lucrative oil development contracts to US and British Oil interests (friends of Bush and Cheney). If this coalition democracy fails, the legitimacy of the contracts fail with it. How much profit is to be made? Is the profit much greater than or equal to the cost of the war and the forward projection of it? Do the american people get the oil and the iraqi's get worthless imperial credits? If we pulled out tomorrow would the oil fields be developed by others...(not Bush's friends). Would this oil still not be on the market for US to buy? It is surely more complicated than this and I realize that the very underpinning of the US dollar...the petrodollar is at stake here. Without the Bush war, the oil would be traded in Euros or maybe even roubles.
TownCrierA GOLD forum...#1518672/7/07; 12:00:31

... or NO forum.

(Just a friendly reminder of our imminent danger.)


HenriMore Hmmm...#1518682/7/07; 12:01:45

Has anything surfaced in these iminant (Feb 7-10) hearings before the Iraqi legislature? Have they been scuttled into secret commitee?
HenriWhy Iraq war is relevant to gold#1518692/7/07; 12:07:17

The messages of Another and FOA foretold of the pricing of oil in euros or currencies other than the petrodollar are key signposts along the trail to higher gold pricing leading to eventual freegold. The failure of the Iraqi electorate to endorse the Bush/Cheney directives as to who will get the oil development contracts have direct bearing on the POG. Perhaps the recent rise of POG is attributable in part to these discussions in the Iraqi legislature.
968China total gold output target set at 1,300 tons between 2006-2010#1518702/7/07; 12:24:40

BEIJING (XFN-ASIA) - The China National Development and Reform Commission said in a statement on its website that it has set the country's total gold output objective at 1,300 tons for the 2006 -2010 period.

China's gold output last year was 240.078 tons, up 7.15 pct compared from 2005.

HenriIn receipt of Louis XVIII coin 1814#1518712/7/07; 12:45:22

very, very nice and an interesting fellow. Came to power in france with the defeat and internment/exile of Napolean Bonaparte to Elba and when Napolean returned he somehow escaped execution and was again restored to the throne after Napoleans ultimate defeat.
TopazEuroX#1518722/7/07; 12:49:08

The 1.30 battleground certainly is throwing no favours in the direction of PM's at present as each side seems hell-bent on reduction.
Tomorrow MAY be different.

AdvocatusWhy Iraq?#1518732/7/07; 13:00:39

@ Henri

Well, yes, oil and petrodollar are part of it, but they figure into the equation somewhat differently. The petrodollar agreement, primarily with the Saudi's, forced other countries to use more dollars, and recycled oil payments back into US investments, particularly treasury bonds. This allowed the US to create more money with relative impunity: the bond balance found guaranteed demand, and the broadening of the monetary base beyond US borders dampened the inflationary effect of money creation at home while taxing those abroad.

Saddam endangered this by switching oil payments to euros in 2000. So one immediate goal for the invasion was to revert that back to dollars. From that perspective, Bush was right when he said "mission accomplished". But the amount of petrodollars can be increased as well by inflating the oil price. The uncertainties of war combined with oil producers throttling production and bogus tales selling "peak oil" did just that. It is no surprise that the Iraqi oil production was almost halved.

I believe though that it was not so much about an indefinite continuation of the petrodollar. Rather, it seems to have been a final squeeze of gain out of the petrodollar so as to smooth the transition to a new system of universal fiat liquidity at low interest rates.

Of course, such a system must be stabilized and balanced. That begs the question: what is the USA going to do without an unlimited credit card. The huge current account deficit means that exports must go way up and imports down. I think that is the reason for the sudden change of White House policy to reduce the dependence on foreign oil and switch to new energy technologies (which can in principle be exported).

mikal(No Subject)#1518742/7/07; 13:45:19

Spending spree over as Americans walk without safety net
By Ambrose Evans-Pritchard
Last Updated: 11:59pm GMT 06/02/2007
"Americans are drawing down their personal savings at the fastest rate since the depths of the Great Depression, suggesting that US household finances may be more fragile than they look."

SurvivorIraq Relevant to Gold? What Else?#1518752/7/07; 14:20:41

@ Henri and Advocatus

If gold is relevant to oil, then Iraq is relevant to gold.

News media rhetoric aside, the only retrospective way to view the Iraq debacle is as an attempt by the US to set up a puppet regime that would be favorable to US oil interests. (Remember those reports of contrete and steel US "cities" going up under the guise of military bases?) This thesis is consistent with the thought that Saddam's oil-for-Euros trade was the real reason for the invasion.

If the Iraq electorate successfully rejects its intended role as a US puppet, then the Iraq failure will be even worse than the current perception.

As the world's biggest oil consumer, the US should hope that the scope of Iraq policy failure does not extend so far as to scuttle the plan for Iraq oil. But if that does occur I predict it will be positive for gold valued in US dollars.

- Survivor

TopazDX.#1518762/7/07; 14:23:04

It's curious to note the Euro was left holding the bag today (apart from that other galoot currency, the A$) as all the other main scrip rushed to the exits visavee Buck early in the going.
What IS interesting and will require resolution going forward is that Buck/Bond should be technically dropping here, which "should" be positive for PM's.
We await tomorrow with bated breath!

TopazDown Boy!#1518772/7/07; 14:32:29

That of course was Buck/Bond "yield" should be dropping ;-)

It will! ....just watch!

White Rose"Dying of Money Book " now on line#1518782/7/07; 14:58:00

Dying of Money:
Lessons of the Great German and American Inflations
by Jens O. Parsson

Is now available as html (I copied the entire book at the Boston Public Library, then scanned and cleaned up the text at home).

This important book explains why the beginnings of a hyper-inflation is benificial, and how the subsequent events are so painful to endure. This is a vital part of "The Gold Trail".

This book is in the public domain, and if our hosts would like it, I can arrange for a copy to be located on this site as well.

AdvocatusIraqi oil. Crucial or not?#1518792/7/07; 15:18:45


Control over Iraqi oil is no doubt a goal since their reserves are large, high-quality, and easy to tap. But I doubt it is a crucial goal, particularly in a post petrodollar era.

For one, there is reason to believe (see link) that the domestic oil reserves are actually much larger than reported. A misdirection that, if true, makes sense from a petrodollar perspective.

For another, climate change is a pressing problem. The measures being talked about now are nowhere near sufficient. The world must move to alternative energy sources. Such a future can be much closer than it appears since, like the gold price, alternative energy technologies have been suppressed. Once they are allowed to surface, control over Iraqi oil is no longer that relevant.

mikalThe big squeeze is on many fronts#1518802/7/07; 15:33:03

International Forecaster MidWeek Reading - Gold, Silver, Economy + More
By: Bob Chapman, The International Forecaster
-- Posted Wednesday, 7 February 2007 | Excerpt:
"Gold production continues to fall in South Africa and now in Peru. That will continue for several more years. All indications are that the shortfall to consumption will persist for several more years. Gold is headed higher no matter what the elitists do, so hold on for the ride of a lifetime.
In the last issue we pointed out that the commercial gold traders were shorting heavily in order to impede the upward progress of gold. Gold isn't about to plunge – they just don't want it going higher. Someone might get the idea that there are problems in the world economy. At the same time the gold ETF buyers are loading up.
The commercials have added almost 50,000 short contracts over the past three weeks net 25, 6 and 17 or an actual total of 48,000. That is an increase in less than one month was 53,937 contracts. This has happened as gold rose $33.00, which certainly was not encouraging for the commercials. Some believe the commercial shorts believe something bearish is going to affect the gold market. We think just the opposite. We believe the commercials are being driven by elitist forces that want to hold gold back because something very bad is going to happen. This is borne out by the wider spectrum physical gold buyers that inhabit the ETFS. They continue to buy, 1.54 tons the week before last and 8.33 tons last week. Barclay's was unchanged, but the UK Lyxor Gold Bullion Securities rose 0.61 tons. We'll bet on the physical buyers.
In silver Barclay's IShares Silver Trust jumped 108.5 tons at a cost of $1.63 billion.
The bottom line is the commercials are not always right and when they are wrong they are very wrong."
Mikal-- In this one Chapman covers gold, mortgages, derivatives in a way a that is sometimes familiar, sometimes shocking, always convincing IMO.

TownCrierWhite Rose,#1518812/7/07; 15:35:08

The book certainly looks like it would be a nice thing to have around.

You've stated that it's in the public domain, and yet I see an indication of copyright 1974. Can you shed more definitive light on its status? Thanks.


Thoreauly@ Advocatus re: Iraqi oil and alternative energy#1518822/7/07; 15:49:25

Here's how historian Robert Higgs puts it (see link):

"[T]he U.S. military presence in the Gulf serves not to ensure that the oil keeps flowing; it merely ensures that U.S. corporations (oil and weapons companies in particular), banks, insurance companies, and so forth will be the specific parties raking in the profits from dealing in the Gulf oil. If they didn't do these jobs, the jobs would still get done, but they would get done by the efforts of other firms (European, Chinese, Japanese, and so forth), which is precisely the point: U.S. foreign policy in the Middle East serves the purposes of specific U.S. economic entities, which in turn more or less control the policies by the way they exercise their financial muscle in U.S. politics."

As for alternative energy sources, the galloping advance of technology stands to free us from dependence on fossil fuels in twenty years, no government intervention required:

"We are awash in energy (10,000 times more than required to meet all our needs falls on Earth), but we are not very good at capturing it. That will change with the full nanotechnology-based assembly of macro objects at the nano scale, controlled by massively parallel information processes, which will be feasible within twenty years. Even though our energy needs are projected to triple within that time, we'll capture that .0003 of the sunlight needed to meet our energy needs with no use of fossil fuels, using extremely inexpensive, highly efficient, lightweight, nano-engineered solar panels, and we'll store the energy in highly distributed (and therefore safe) nanotechnology-based fuel cells. Solar power is now providing 1 part in 1,000 of our needs, but that percentage is doubling every two years, which means multiplying by 1,000 in twenty years. Almost all the discussions I've seen about energy and its consequences, such as global warming, fail to consider the ability of future nanotechnology-based solutions to solve this problem." --

Global warming hysteria, however, will see to it that massive government intervention takes place, which in fact has already started -- -- the effect of which will be to expand the debt bubble even more, with gold being the ultimate beneficiary.

USAGOLD Daily Market ReportPage Update!#1518832/7/07; 16:35:37">
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.

WEDNESDAY Market Excerpts

February 7 (Reuters) -- U.S. gold futures finished slightly lower despite lacking a definite direction on Wednesday, whipsawed by a weaker dollar and lower oil prices.

Analysts said that gold could retest new highs because of renewed investment demand if the precious metal moved above key resistance levels.

Most-active gold for April delivery on the COMEX division of the New York Mercantile Exchange settled down $1.40 at $657.30, traded in a tight $5 range between $656.40 and $662.00. The April contract had closed higher in each of the previous two sessions.

"The market has found some investment interest again here in the last couple of weeks ... And this general sense of building inflation has seemed to catch hold once again in gold" because of rising crude oil prices, said Darin Newsom, markets analyst at DTN.

Newsom said that gold was in a long consolidation phase and there was reallocation of index-fund money and investment money back into the bullion market.

Oil prices initially rose to above $59 a barrel as a blast of cold weather boosted heating oil demand in the United States, but they later fell more than a dollar because of profit taking.

The dollar traded near a session low against the euro, after data showed higher fourth-quarter U.S. business activity had little impact on the greenback. Gold often moves in the opposite direction to the dollar, as an ailing greenback makes dollar-denominated assets like gold less expensive for holders of other currencies.

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

TownCrierKorea: Gold Rush#1518842/7/07; 16:48:43

FEBRUARY 08, 2007 -- Mr. Lee (34), who is working for a big company, got into gold investing early last year. He is investing 300,000 won a month in [...] a gold commodity of Shinhan Bank

He said that it is really fun to check the gold price and its earning ratio everyday. After hearing news that the International Monetary Fund will sell off a 400ton lump of gold early this month, he looked for analysis articles about how this would affect the international gold price.

Lee said, "a year of investment led to 12 percent profits. Since investing in gold, I got interested in the international economy and now, I think my eyes have become wide open."

He meets members of a gold investment club once or twice a month and exchanges investment information. Most of them are 30-something office workers.
Yu Yu-jeong, head of the commodity development team at Shinhan, said, "Taditionally, wealthy people in their 50s or older have been interested in gold, but recently, the number of young people who invest in gold by putting a certain amount monthly has drastically jumped."

With the sale of Shinhan's convenient gold commodity in the form of non-physical transactions, young people have started to show interest in gold investment...

Physical transactions mean purchases of gold bars in 100g, 500g and 1kg units in person ... purchase of the actual article comes with a five percent trade commission and a ten percent value added tax.

On the other hand, in the case of non-physical transactions, investors put money in their account, the bank buys gold in their name and returns profits according to the gold price when they withdraw the investment. There is a commission of 1.2 percent of net price received when selling the investment. Still, this is far more profitable as there is no tax on investment profits.

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

Sounds to me like a group in firm need of a Trail Guide...


HenriPerhaps there is more here than historical production figures reveal#1518852/7/07; 17:38:11

This looks to be a lot of unexplored/exploited potential. WHO gets the development rights is very much an issue as the undermining of OPEC is projected with the bonanza not so far beneath the sands oh so easily vitrified sands of Iraq.
ArcticfoxA coin for your collection?#1518862/7/07; 19:10:27

Mint planning million-dollar coin
Last Updated: Wednesday, February 7, 2007 | 12:46 PM CT
CBC News
You'd need mighty deep pockets to jingle the new coins planned by the Royal Canadian Mint: Canada's official money-maker wants to stamp out a $1-million coin.

Coin experts say it would likely be made of gold, be the size of a pizza and be extremely heavy. Some numismatists wonder if it would be a good idea.

The federal cabinet passed an order earlier this month at the recommendation of the transport minister allowing the mint to stamp out the non-circulation coins.

The editor of Canadian Coin News, Bret Evans, said if it goes forward it would be the first of its kind in the world, the mint's attempt to create a record-breaking coin.

"The coin becomes an event," Evans said. "It's purely being done to get attention. To throw something on the market, to make a statement which is, 'Here we are.'"

There's no word on how many coins the mint is looking at stamping out. Mint officials acknowledge they have permission to make a $1-million coin, but will not comment beyond that.

Continue Article

Coin experts are talking, though, and among those questioning the project is Regina dealer George Manz, who wonders who would buy the mint's mega-loonie.

"The people that I know, if they're going to go and spend $1 million on a coin, they want something that is extremely rare," he said.

On the other hand, Evans notes that the last time such a special coin was made — €100,000 from Austria — all 15 sold out in less than a month.

The $1-million loonie, he figures, would weigh around 100 kilograms — about the weight of a typical hockey player.

Chris PowellS. African Reserve Bank adds 700,000 gold ounces to reserves in January#1518872/7/07; 19:40:25

By Evan Pickworth
I-Net Bridge, South Africa
Wednesday, February 7, 2007

The South African Reserve Bank's holdings of gold reserves increased markedly in January to 4.684 million ounces from 3.990 million ounces in December 2006, and according to a leading economist, this could be due to the bank's taking the opportunity to build up reserves when it is "hard to argue against a long-term bullish view on gold."

"Keep in mind that they do not declare the constituents of the portfolio, so whatever we say is speculation. You could, however, look at gold as another reserve currency and it is hard to argue against a long-term bullish view on gold," explained Goolam Ballim, chief economist from Standard Bank.

"There is a cautionary motive to some of the South African Reserve Bank activities and this is in line with the constructive view that it is an opportunity to build up reserves," he concluded.

The SARB's gold and foreign assets total 187.696 billion rand at the end of January from 178.318 billion rand at the end of December, the SARB announced on Wednesday.

The gold component was valued at an average price of 4,684.15 rand an ounce.

mikal@Arcticfox#1518882/7/07; 20:40:44 Mint Planning Million-Dollar Loonie - Tim Naumetz, CanWest News Service - Ottawa Citizen - February 7, 2007
This is not a bad idea,
especially if it's the start of a new trend.
But as they say it's premature to speculate on their final plans. Maybe they'll (feel obligated to) wait for higher POG.

PalMillion Dollar Loonie#1518892/7/07; 22:25:53

The Royal Canadian Mint should wait for an international financial crisis caused by a derivatives collapse and the ensuing flight to quality(GOLD) before creating a million dollar coin... they would only need a fraction of the ounces currently needed.


PS-Perhaps they know this and are preparing the general public for much higher Gold prices ;)

CaradocRE: White Rose's mid February prediction#1519192/8/07; 15:22:09

GoldiloxGutting Civilization for a Short Term Profit#1519202/8/07; 16:07:02

@ Caradoc,

Don't feel like the Lone Stranger. I was accused in this forum of fomenting my "personal view" of the "Stink of the Economy" as one reporter on CNBC inadvertantly called it today. However, with patience, I have found that most of the information I have spelunkered and posted here has been cross-verified within about 6 months of initial posting. I am certainly no "prophet", but perhaps I do have just a little more time to dig than the average working Joe, and typically stay ahead of the curve.

The charade continues - the banksters conduct business as usual even while patriots like GATA pull their covers publicly. What do they care, when the CIA "economic hitmen", the courts, the police, and now even the US Army "work for them" under "Executive Decree". Blow a whistle, and go directly to IRS Hell like Catherine Austin Fitts, or maybe take the next plane to Wellstone!!

Everyone said it was crazy to suggest that Cheney wined and dined Scalia just to keep the names on his "Energy Policy Committee" secret, but when Ken Lay, rumored to be a strong participant by the very number of his White House visits, was tried and convicted, then expired prior to sentencing, the haze actually became a lot clearer. Our "National Energy Policy" was being formulated by the very guys ripping the public off with their energy scams.

If the SEC actually had the power to audit anyone but ordinary citizens and White House political enemies, we would not only know who placed the 911 airline puts, but we would also know who sold ENRON stock and options "at the top". My bets are on the "private" members of the PPT, as those funds are now busily propping up the Treasury markets from numbered Caribbean accounts, while China and Japan phase back the volume of their purchases.

How does that relate to gold? The same BS is rampant. We don't get to hear who actually buys Central Bank gold rumored for sale, even though that information is much more useful than the announcement of a "pending sale". Nor do we ever see Western Banks acquring gold, as if the gold they sell materializes out of "thin air" (or war and contraband booty, as it may be).

"Stink of the Economy", INDEED. The first true statement heard on CNBC in years!

MKMelde Laure, Sierra Madre#1519212/8/07; 16:15:39

Interestingly, much of the "eminent person" IMF panel represents incipient physical gold buyers [though the long term goals of some might be slightly different than others]:

JP Morgan -- perennially short and well aware of the need for a steady supply

Saudi Arabia -- oil for gold [sooner rather than later]

China -- "where do you want us to wire the money?"

The ECB -- "better the IMF than us' - - let's just say Trichet might have been representing "European" interests [familiar names]

South Africa -- at first I was stumped by this, then I saw CP's post last night; that was a fairly large purchase; SA is in the market which more or less bottles up a big chunk of the supply

Harvard Fund -- more muscle than most countries and suddenly interested in gold availability??

Mexico -- more oil for gold??

And. . .

Alan Greenspan -- for his personal collection [just kidding] -- the "nostalgia" continues

BoilermakerTC's "The Good, the Bad & the Ugly" Challenge#1519222/8/07; 16:52:55

The treasure, 10,000 ounces worth $200,000 then and $6.6 million now. More importantly (for me at least) I acquired a golden crown today on molar #3 making me more valuable dead than alive. :-)

Gold remains a valuable asset through the ages. It's best (but not so exciting) to obtain it gradually by purchase not by treasure hunting. 24K teeth are a start.

Chris PowellSouth Korea considers moving reserves into foreign stocks#1519232/8/07; 17:48:05

By Song Jung-a and Florian Gimbel
Financial Times, London
via Yahoo News
Friday, February 9, 2007

South Korea's central bank said yesterday it was considering investing part of the nation's huge international reserves in overseas stocks, and especially the blue chips of advanced countries, in an effort to gain higher returns.

The announcement comes as the Bank of Korea faces increasing calls for better management of $240 billion (E185 billion, £122 billion) in foreign exchange reserves, the world's fifth largest, after nine years of growth.

The BoK said it had invited foreign asset managers to pitch for potential mandates to manage its overseas stock investments and was considering entrusting them with investments.

"There is no change in the central bank's basic principle that it will invest in liquid assets yet improve returns on foreign-exchange reserves," Lee Seong-tae, the BoK's governor, said after the bank held its benchmark interest rate steady at 4.5 percent for the sixth consecutive month.

"We are considering managing international reserves through overseas investment banks. That may include buying blue chips in advanced countries," he said.

Mr. Lee said the size and timing of any foreign stock investment had not been decided and that, when it happened, the initial amount invested would not be very big given the need to maintain stability in the management of the reserves.

One Hong Kong-based investment consultant said: "Managing money for the South Korean central bank is on the radar screen of all the big institutional fund managers. It's a trophy mandate that none of them would want to miss out on."

The BoK's move follows a policy switch in China, which also wants to diversify its more than $1,000 billion of foreign reserves, 70 percent of which are believed to be held in dollar-denominated assets.

To generate higher returns, the People's Bank of China, the central bank, is in the process of hiring international fund managers specialising in equities, although any investment mandates are likely to remain secret for fear of revealing the bank's investment strategy and reserve composition.

Lim Ji-won, at JPMorgan, said: "It is a global trend that central banks are trying to diversify their assets towards higher-yielding investments. But I think the BoK's investment in overseas stocks will happen only gradually, given its lack of experience and its original purpose of securing enough liquidity."

Chris PowellBolivia to seize mineral refinery#1519242/8/07; 18:45:33

By Carlos Valdez
Associated Press
via Yahoo News
Thursday, February 8, 2007

LA PAZ, Bolivia -- President Evo Morales said Thursday he would nationalize a mineral processing plant owned by the Swiss mining company Glencore International AG, the first step of his plan to take control over a larger share of Bolivia's mineral wealth.

Morales did not state the terms under which his government would take over the Vinto plant on the outskirts of the city of Oruro, 110 miles southeast of La Paz.

But the president said the plant would be nationalized by a decree to be issued Friday, saying there had been a lack of transparency in its financial dealings without providing details.

"Companies that respect Bolivian laws, that do not steal money from the Bolivian people, will be respected," Morales said Thursday to community leaders in Oruro ahead of the city's Carvinal celebration next week. "But if the companies do not respect the laws, I have no other alternative than to recover those companies."

Offices of Glencore's Bolivian affiliate Sinchi Wayra were closed Thursday evening and company officials could not immediately reached for comment.

The announcement marks the first step in Morales' plans to nationalize Bolivia's mining industry, though how the process will continue still remains unclear.

All of Bolivia's extensive mineral deposits are already owned by the government, which operates a handful of mines through the state mining company Comibol. The rest are mined through concessions granted by the state to independent miners' cooperatives or international companies, including Glencore and U.S.-based companies Coeur d'Alene Mines and Apex Silver Mines Ltd.

Rising international metal prices, fed in part by demand from China, doubled the value of Bolivia's mineral exports to more than $1 billion last year from $547 million in 2005. The metals -- mostly zinc, silver, gold and tin -- together represent Bolivia's largest export after natural gas.

Despite the sharp increase, the Bolivian government collected only $45.5 million in mining taxes last year. Morales has proposed a tax hike that aims to boost the government's take to as much as $300 million.

Earlier this week more than 20,000 members of independent miners' cooperatives marched into the capital of La Paz to protest the tax increase, hurling dynamite and blocking traffic in the city center. Morales agreed to freeze the miners' taxes and instead direct the tax hike at larger private mining companies operating in Bolivia.

The Vinto plant -- which refines ore containing tin, lead, and silver -- has a strong symbolic value in Bolivia. After its 1996 privatization, the plant was bought by Comsur, a private mining company whose largest stockholder at the time was former Bolivian President Gonzalo Sanchez de Lozada.

Lozada fled Bolivia in October 2003 during riots against his administration, and is still sought by the Bolivian authorities in connection with a crackdown on the protests that left more than 60 Bolivians dead.

Glencore bought the plant from Comsur in 2004.

GoldiloxCBs buying stocks and bonds#1519252/8/07; 18:51:27

Rule number one of any Pyramid scheme is "look for a bigger fool to be left without a chair when the music stops".

It seems to me that under the guise of "propping up the markets", the larger CBs are turning the smaller ones into those "bigger fools", perhaps with behind-the-scenes political pressure.

Have they finally tapped out all the insurance and pension fund "investors" seeking greater returns for their gubmint and union employees? IRAs and 401k accounts are way down since Y2K and the accompanying "Internet bubble", so greater fools are getting more scarce.

The second rule is that each level of a pyramid must be larger than the previous one, to maintain the appearance of "growth", and justify dividends to the upper layers using incoming "investments" to pay the previous investors.

Unless 1.3 billion Chinese are chomping at the bit to become Wall St. gamblers, the stock market may be in for trouble. When the bankers themselves are buying the goods to prop up the prices, it doesn't bode well.

That's about like selling street numbers back to the Mob. Someone is gonna get hurt!

Silver FoxAn Austrian Perspective: inflation or deflation?#1519262/8/07; 19:11:02

Here is something interesting to read:


"Money itself (however one defines it) is a claim on real savings (a placeholder for saved goods). For example, a baker makes bread, so what he actually saves is bread. The baker only transforms his savings into money (typically a monetary commodity that has a prior demand for other uses, such as gold) because that's far more convenient. The baker cannot actually save bread, as it would get old.

Therefore money, as such, is a claim on real goods. Credit by contrast, is a claim on money itself, which in turn is a claim on real goods. In our present system, credit claims on money to be paid back in the future masquerade as actual money and can thus be termed "synthetic money". In addition there is a "multiplier" effect. Someone gets a loan and spends it on goods. That money is deposited and is treated as money regardless of whether or not it is backed by real goods. Via sweeps and still more lending, the same money is lent out time and time again (the multiplier effect). This is the failure of the central bank administered fiat system: monetary claims proliferate beyond actual production of goods to back them up. In a honest system, only actual savings would be transferred from savers to borrowers (with banks acting as middlemen).

This "credit inflation" is thus fundamentally different from the "Weimarian printing press inflation". The Weimar situation brings about hyperinflation as the monetary unit itself is inflated in its physical form, as banknotes. By contrast, a credit inflation that creates claims that masquerade as money is prone to deflation because the money needed to pay back the credit is in a shortage (relatively speaking) compared to the outstanding credit claims.

This does not entirely preclude an inflationary outcome. After all, the Fed could in theory decide to monetize just about anything. It could monetize defaulted bonds and loans, it could even go and buy up foreclosed houses if it is prepared to go the Weimar route in order to avert what it would deem a deflationary calamity. As we have discussed in the past, this is unlikely to happen for a variety of reasons. In addition to the ideas expressed in those articles there is bureaucratic inertia to the fear of losing wealth and power. One key point in this regard is the fact that the Federal Reserve system is made up of creditors. Those creditors will not like the Weimar solution because it would debase their credit claims."

This I believe is the message Trichet, Poole, and Weber were attempting to convey in Central Bankers Cry Wolf.

Weber: European Central Bank council member Axel Weber said investors shouldn't expect central banks to bail them out in the event of an "abrupt" drop in financial markets. "If you misprice risk, don't come looking to us for liquidity assistance," Weber said in an interview in Davos, Switzerland at the annual meeting of the World Economic Forum. "The longer this goes on and the more risky positions are built up over time, the more luck you need."

Trichet: Current conditions in global financial markets look potentially "unstable", suggesting that investors need to prepare themselves for a significant "repricing" of some assets, Jean-Claude Trichet, president of the European Central Bank. "We are currently seeing elements in global financial markets which are not necessarily stable," he said, pointing to the "low level of rates, spreads and risk premiums" as factors that could trigger a repricing.

Poole: "The Fed can provide liquidity support but not capital".
The most important facet of all of this is that monetary claims very likely exceed the pool of real funding by several orders of magnitude. When push comes to shove, this house of cards will eventually collapse in some way.

It is important to recognize that what is happening right now with stock buybacks, leveraged buyouts, and various carry trades for what it is: one giant Ponzi scheme. This will end the way all Ponzi schemes end: when the willingness or ability of consumers or businesses to take on more debt stops and/or when the willingness to further speculate stops. When either of those happens there will be a mad rush for the exits and no more buyers for ‘overpriced tulips’ will be found. Be prepared."

Nobody is rushing for the doors, yet, but is seems that more and more people & countries are getting nervous.

Hope this helps,


TownCrierBoilermaker, The G,B&U#1519272/8/07; 22:11:17

Nicely done. And my hat is off to the props department that did a good job representing/simulating the appropriate volume (the size of those eight bags) for that quantity of gold. (But at approx 100 lbs. each, "Blondie" must have had an adrenalin boost to help him lift them onto his horse with such a modest sign of struggle. Tuco's evacuation of the grave seemed closer to the needed effort.)


GoldiloxSilver in pyjamas could combat hospital bacteria#1519282/9/07; 01:19:09


LONDON ( --Pioneering pyjamas and bed linen made with silver cloth could prove the key to limiting MRSA (a bacteria which has caused a number of illnesses and deaths to patients in UK hospitals) infections if a multi-centre trial being run by St Bartholomews Hospital in London and The London NHS Trust proves successful. If the trial is successful this could provide another outlet for silver metal. An effective trial could lead to such pyjamas and bedsheets being specified thoughout UK hospitals, and doubtless in other countries too, and have a positive impact on the silver market

Dr Peter Wilson, a Consultant Microbiologist at the Trust, believes there is strong anecdotal evidence to suggest that silver can be used to clear MRSA on the skin and therefore protect vulnerable patients. To prove his case he has enlisted the help of the Lister Hospital in Stevenage, UK and is in discussion with The Queen Elizabeth Hospital in Woolwich, UK to run two separate clinical trials which will take place over the next 12 months.

Silver which has an excellent safety profile, is one of the oldest anti-microbial agents known to mankind, with records stretching back to ancient Greece. It is currently used more extensively in many other parts of the world – for example the US military use silver in socks to keep them odour-free.

Dr Wilson, said: "Silver is known to be a very efficient agent against infection and also very safe. These trials will mean we can prove its effectiveness. It is already being used in a number of medical products such as plasters and even in washing machines so this is just the next logical step. If it is successful it will transform the way we tackle certain infections, particularly MRSA, and also help to cut costs as this would be a very cost effective solution compared to traditional methods."

MRSA is a bacterium that can live completely harmlessly on the skin and in the nose of about one third of healthy people without causing any problems. However it can lead to serious infection if it enters the bloodstream.

The trial at the Lister Hospital, was started early this month. The hospital will seek to recruit 300 patients, who have tested positive for carrying MRSA on their skin, from the hospital's general medicine and elderly care departments. They will all continue to receive their normal infection control care but in addition 150 patients will receive the silver-lined pyjamas and linen and 150 others will receive standard materials. At the end of the trial, in approximately six to twelve months, the results of the two groups will be compared to see if the silver enhanced pyjamas led to increased MRSA eradication than traditional methods.

Noel Scanlon, Acting Director of Infection Prevention and Control at East and North Hertfordshire Trust, said: "The idea behind silver in bed linen and pyjamas, which is used already in a wide range of wound dressings and in cement used during bone operations, is that its contact with the skin may help to get rid of bacteria like MRSA, thus reducing the chance of that patient, or others elsewhere in the hospital, becoming infected.

"This is an exciting project and we are very pleased to be one of the hospitals involved. While time will tell as to whether or not silver-containing bed linen and pyjamas will have the positive effect anticipated by the researchers, it cannot ever be viewed as a magic bullet that will solve the problem of healthcare-acquired infections forever. aseptic medical procedures, careful use of antibiotics and keeping the patient environment clean."

It is hoped a second trial will take place at The Queen Elizabeth Hospital where patients who are carrying the bacterium but do not have an MRSA infection will again be split between silver-lined materials and the placebo pyjamas and sheets. The difference in this case will be that patients will not receive any additional antibiotics or other treatments to remove the MRSA bacteria from their skin. By comparing the different trials evidence should be produced to prove or refute silver's effectiveness.

LebiequeMaund/Powell tiff#1519292/9/07; 01:21:32

Nothing like a little tiff amongst the experts. If the proof is so off-base regarding "deliberate manipulative interference", why then this deliberate attempt by the banking powers that be, to demonetise hard money, from forex to commodities say. Did they ask their customers if that was what they, the customer, wanted, or did they just go and do it, in connived collusion perhaps? A little like demonising tobacco whilst taxing it, having your cake and gobble it, hey? Cash, of course, is next in line, judging by the moratoriums on maximums and those convenient terror laundering controls out there.

Service costs, after all, are peanuts, we need to rehire-out debt and collect a usage-fee without any alternatives, that's where the money is. Once you've become accustomed to $5000 plonk with the sushi it's understandably difficult to rehabilitate. Heaven forbid any current or future savings by the rank and file out there. I'd agree with the concept of "deliberate manipulative interference" per se being a little far fetched, but that's hardly the point, it's enough for the donkey to wonder why he can't reach the carrot in front of his face.

Just like the housing bubble sprang from the need to re-balance dickey balance-sheets of debt-drenched corporates (with a little help from the appraising community), so will the drive to pure digital medium of exchange not accept any God beside himself, and that by any if advertorial means. (in case of doubt, I side with Powell)

GoldiloxEconomist Hale warns possible U.S. hedge fund crisis may hurt commodities#1519302/9/07; 01:24:28


CAPE TOWN ( --U.S. Economist David Hale warned Thursday that a crisis in the New York hedge fund community over the next few months could cause a larger than "moderate" fall in commodity prices.

Speaking at the 2007 Mining Indaba, the Hale Advisors expert said that continued economic growth expected in the United States, Europe and Asia this year may see commodity prices dip between 20 and 25%. A slide in this range could be described as "moderate’ when compared against historic price trends.

However, he cautioned that there were signs of crisis in the hedge fund community that has invested large sums of money in commodities. Hale suggested that stakeholders had to remember that hedge funds do not always have good risk controls in place, and could cause major problems in commodity markets.

"Hedge funds could cause large amounts of money to be withdrawn from the markets, we all have to watch very carefully what transpires in New York," he advised.

One of the most critical issues pertained to how distressed hedge funds would manage redemption of pension funds, and what spillover this would have in the rest of hedge fund community, according to Hale.

The good news for commodities was based on the fact that fears about a recession in the American economy have subsided, Hale said, with the country expecting modest growth of between 2% and 3% this year.

"With a gross domestic product of over $13 trillion, the U.S. is still an important consumer," Hale explained. "Its economy also has a spillover effect on regions such as Canada, China, Latin-America and East-Asia."

He added that prosperity in Africa, a by-product of larger changes in the global economy, was very broad-based, as developing worlds have exciting growth stories to tell, noting that China showed "spectacular" economic growth of 10.5% last year.

The strong economic growth in developing countries was driven by commodity prices, Hale asserted.


Chicken Little, anti-gold spin, or legitimate warning? It's hard to tell!

GoldiloxDavies: China's African drive motivated by more than commodities#1519312/9/07; 01:37:16


CAPE TOWN ( -- China's drive into Africa is not only motivated by the acquisition of commodity assets and securing energy supply on the continent, but also focused on creating a new global commodities market, opening trade and expanding agricultural production.

Dr. Martyn Davies, Chief Executive Officer of Emerging Market Focus, a South African-based research and strategy consultant, said Wednesday that Chinese presence on the continent was driven by a clear political strategy from Beijing. Davies is considered to be an expert on China.

In a presentation to the 2007 Mining Indaba, Davies said that China was seeking to extract itself from international commodity pricing strategy as the nation believed the existing market was manipulating commodity prices.

"The Chinese perceive the metals exchange as a rather expensive enemy that they can circumvent by buying direct from the source," Davies asserted. "Although we will see how this plays out over the next 20 to 30 years, I believe that we will see a parallel global commodity market established by the Chinese."

Davies suggested that factors such as the United States invasion of Iraq have fueled China's "paranoia" about energy supply, and have accelerated market entry and the acquisition of commodity and energy assets in Africa.

Trade-related issues also played a role, he said, as trade between African and China would soon exceed $100 billion dollars. He forecast that Africa would become China's largest trade partner within five years.

Davies said that Chinese capital was often better used and invested in Africa, and that the Chinese were not "overpaying" for assets in African countries. However, he added, one had to take into account that 65% of China's outward investment was owned by Chinese state-owned enterprises, which provided "political" capital for investment on the continent.

In contrast with Europe, which could view Africa as a burden, China and India regarded the continent as a commercial opportunity, he stated.

Davies said Africa was still very naïve about Chinese involvement in Africa. Nonetheless, South Africa is calling for more multi-lateral engagement with countries about the commercial and political implications of an increased Chinese presence on the continent.

Asked about the absence of Chinese delegates at the Indaba event, Davies claimed the China did not engage in traditional modes of business and was not familiar with the notion of information sharing. Mineweb, however, has previously reported on the attendance of Chinese delegations at other mining conferences in the Americas. Chinese Central Government and provincial government officials have made presentations at several events.

Davies explained that the Chinese were succeeding in establishing a strong presence in countries such as Sudan and Zimbabwe, as deals in these countries were viewed as very political. Some African countries were also more open than South Africa that had regulations and requirements in place.

"China wants to broaden its soft power on the continent – it has a long term strategy of two to three decades in place," Davies said. "The country sees Africa as a training ground for operating in risky environments and managing natural supply chains."

Davies stressed that the Chinese were very pragmatic and tended to see matters in black and white. "They don't see why they should buy diamonds mined in Africa from Europe and therefore simply cut out the middleman."


China is using its privilege of wealth one step better than Western "investors", by using its state status to "influence" deals and long term relationships. Unlike the West, which tends to cloaks its politics behind the machinations of the WB/IMF, China, as majority owner in its businesses, can deal "direct". It's just one more way the western "banking" metaphor is being outmaneuvered by a strong and wealthy China.

USAGOLD / Centennial Precious Metals, Inc.FREE Gold Information Packet...#1519322/9/07; 07:01:01

CometoseHale / commodities /hedgefunds#1519332/9/07; 07:38:14$CRB&p=W&b=3&g=0&id=p56093444173

Since last may there has been already (looking in the rearview mirror ) a close to 25% drop in the CRB...

Interesting to not that this drop in the CRB happened to a very large degree because of Goldman's rejiggering of it CRUDE oil Component in that MEASURE .

( There will be continued and relentless attempts by "bnakers" to attempt to keep smily faces stuck to all fronts as they massage /manage the numbers to their own ends and the ends of BIG GOVERNMENT). That rejiggering of the OIl Component in THE CRB happened just in time for the big drop in OIL last summer.

There was a Hedge fund crack up in the fall of 2005 (it seemed to loom large in the news ; Refco was involved and Jim ROGERS got burned, if memory serves , big time ).

If one looks at the charts of gold and the crb at tht time of that hedge fund crack up , there was little if any significance on the price of GOLD OR SILVER except perhaps a little sideways chopping .

I think it interesting that Jim Rogers has already spoken relative to the issue of where commodities are going and why .

I don't know who Mr Hale is but over the years I've become accustomed to parrots getting in front of the microphone and speaking .........and saying things.........

I was mentored by a person whom I have great admiration for and because of his influence in my life , I came to know that NO MAN OR WOMAN has any AUTHORITY to speak out on any subject that HE OR SHE hasn't DONE...YOU DO and then you can speak with AUTHORITY ...

I can speak with authority about launching business....
I succesfully have done that on multiple occasions .
from ground ZERO . There are details involved that you come to understand that you can teach to others.
Your actions in the field make you an authority . Your success makes you an authority .

Mr JIM ROGERS and MR JIM SINCLAIR are two individuals that I have come to respect ........because of their experiential knowledge with respect to MARKETS , specifically commodities markets......

WHEN they speak , they speak with authority because they have authority based on experience in the field and success.

Jim Rogers said that "after the correction in the OIl Market" ,,,,,,,,,,Oil is going to $100 a barrel.

THE TRAINED AND ASTUTE who are WALL STREETS FINEST are going to stick their heads in the sand and run from the commodities markets .... if the HEDGE FUND COMMUNITY has a few knockdowns while THE PRICE OF OIL (the rejiggered component of the CRB : CLEAN UP HITTER FOR THE CRB : THE HEAVY WEIGHT OF THE COMPLEX) is going to $100.

There are a many things that would have to happen for commodities to go down another 25%......The CRB would be reading 205 .....HOW IN THE WORLD COULD WE SEE SUCH A DROP ?

WOULD SUCH a plunge happen in a time of war?

WOULD such a plunge happen during times of robust economic

WOULD Such a pluge happen in KONDRATIEFF WINTER

Would such a plunge happen in a LIQUDITY BOOM of the vastness that we have been witnessing avert a deflationary spiral....

LOOKING in a Global Context at just these issues , Mr Hale's comments look like STATEMENTS given TO SCARE PEOPLE OFF the BALL

A Severe about face in all of the above circumstances can happen in a MELT DOWN ..

A SEVERE ABOUT FACE in all of the above contexts might take us back to 1929.......

THE FEAR caused by such instability in that DEPRESSION caused GOLD (HOMESTAKE MINING increased 10 fold and its dividends increased in like measure )

I don't know Mr Hale's background or his experience , but I know putting his statements in the context of Present Global Circumstances makes him look like a " PAID/made

There are simple principles that rule ......what is ......

One of them is the production of MASS MONEY CREATION which is a cause .......

Money supply is growing faster than ever before ....15% per annum . Using the rule of 72 , in four years plus , we will double the amount of $$$ in the world....

SUPPLIES of commodities are not coming out of the ground that fast ..

I don't understand it completelty but I believe it is true, and I believe it is a rule .

WHen you grow your money in this fashion , You are making move dollars in existence CHASE limited RAWMATERIALS (which cannot be created out of thin air as money is now being created) . DEMAND for those RAW MATERIALS with and increased supply of MONEY is going to force the price of those limited supplies UP (KONDRATIEFF WINTER CHINA is holding big supplies of US FRNS and like many other countries has DECIDED TO DIVERSIFY OUT OF DOLLARS INVEST IN RESOURCES )

Further CONTEXT CLUES make clear that the dollar is losing it's preeminence in the affairs of GLOBAL TRADE and therefore the demand for dollars is waining the midnight hour of its reign .....Power Legitimacy and Authority go hand in hand on the global political front.

THE AUTHORITY AND LEGITIMACY associated with the dollar il lost on the actions of our leaders.......

Based upon what I hear him saying ........I think Mr HALE must be a dollar buff. People who stand with him in this vein are all going to be in the BUFF.....

It's very subtle but ,,,,,,,that's what he is promoting
His comments are completely without context economically and on a global level ........

He must be a TBOND SALESMAN .........

A few weeks ago , TOUTS were saying that the commodity boom was over .......NOW WE ARE GOING TO HAVE A CRASH after a 25% CRUDE GUIDED CRASH ........

KEEP EATING YOUR GRUEL MR HALE ,,,,,,,,and good luck in your endeavors .......

You've risen as far as your going to go in the NETWORK that you are owned by.......

Make sure the establishment pays you well for your blurbs now ,,,,,,, No one will listen to you again .


mikalOde to goldbugs and their "cattle standard"#1519342/9/07; 07:39:26 If Hedge Funds Kept Cows, Your Milk Would go Sour - Mark Gilbert - Opinion | February 9, 2007
The famous joke about two cows used to define political systems, here is applied to the financial markets. Can you say brilliant?

contrarianCCI#1519352/9/07; 08:15:50$cci&p=W&b=3&g=0&id=p56093444173

Cometose--look at the unrejiggered Continuous Commodity Index, which represents the commodity index without all the recent bogus changes, and you'll see through the deception, and that the commodity bull is actually alive and well.
CometoseHale / commodities / hedge funds#1519362/9/07; 08:16:30

Where is the smart money going ..... THe smart money is actually RUNNING TO THIS (not away from it )

THink Physics ; THe Law of Gravity ......


I hope MR HALE's comments convince some invested the HEDGE FUNDS to Withdraw their money and seek other more REPUTABLE arenas toward investing their money in COMMODITIES.

Maybe his comments will convince those having second thoughts about having their money with professional gambler managers to relocate their funds and manage their risk themselves.........

Quit giving your money to SLICK GREASEBALLS who promise to make you 50% per annum using leverage .....

Manage your own assets ; BUY some bullion , coins , etc and then buy GOOD JUNIOR MINING COMPANIES that will give you all the leverage you need.
YOU CAN MANAGE YOUR MONEY BETTER than someone promising to take the responsiblity away from you and promising you BLUE SKY RETURNS......That'S the EXPRESS ROUTE TO THE POOR HOUSE......

Maybe that is what MR Hale meant when he tried to PUT THE SCARE ON THE COMMODITIES BULL.


HERE'S a WARNING ............

IF YOU DON'T GET ON THIS NOW and use this soft spot in this market to establish positions ,,,,

It's going to look like you missed the biggest bull of the decade(s) when GOLD GOES OVER $1000 ........ by that time It will have just knocked off its training wheels....and you'll be set for the ride .

PAPER SUCKS and MEN LIE ,, the TRUTH OF SILVER AND GOLD (as a hedge against the empty promises of PAPER PANDERING MONEY PRINTING BANKERS taking us to the outer limits of fiscal irresponsibility) ABIDE.

CometoseContrarian #1519372/9/07; 08:19:39

TownCriermikal, thanks for the ecownomics link...#1519382/9/07; 08:23:20

Very good for a laugh, and educational, too.

My only complaint is that under the heading "gold" he really didn't focus on gold, but rather played for laughs and took an easy (and probably well-deserved) potshot at society's lunatic fringe.

To rewrite his last section with a proper emphasis on education, as was largely done with the other entries, it would appear something like this:


You have two cows. (And I mean you REALLY have them.) This is more cattle ownership than all of the above-mentioned schemes combined. Your position counts as true WEALTH; the others do not.

Recommended reading for all.


GoldiloxWhat's a billion?#1519392/9/07; 08:26:04


My friend Ehor ("The Mazurok-Ure Correlation" 2001) sent along this snip making it's rounds on the net:
"Political Math
The next time you hear a politician use the word "billion" in a casual manner, think about whether you want the "politicians" spending your tax money.
A billion is a difficult number to comprehend, but one advertising agency did a good job of putting that figure into some perspective in one of its releases.
a. A billion seconds ago it was 1959.
b. A billion minutes ago Jesus was alive.
c. A billion hours ago our ancestors were living in the Stone Age.
d. A billion days ago no one walked on the earth on two feet.
e. A billion dollars ago was only 8 hours and 20 minutes, at the rate our government is spending it.

While this thought is still fresh in our brain, let's take a look at New Orleans. It's amazing what you can learn with some simple division...

Louisiana Senator, Mary Landrius (D),is presently asking Congress for $250 billion to rebuild New Orleans . Interesting number, what does it mean?

a. Well if you are one of the 484,674 residents of New Orleans, every man, woman and child would each get $516,528.
b. Or, if you have one of the 188,251 homes in New Orleans, your home gets $1,329,787.
c. Or, if you are a family of four, your family gets $2,066,012.

Washington, DC. Hello!!!!! Are all of your calculators broken?"


But of course, as the GAO has revealed only 15% of the money "earmarked" for New Orleans actually gets put to use, so muliply the above by 0.15, and assume 85% for political chronies.

GoldiloxSGIF - Spank Gold it's Friday#1519402/9/07; 08:52:56

Well, the PPT (Paddle packin' team) has arrived on schedule, but so far, they're only able to deliver $663 and change.
mikal@TownCrier#1519412/9/07; 08:54:29

Agree. He rounded out his satirical summary with an oblique assent to gold by including gold, goldbugs and the "cattle standard" however variously misinterpreted, misunderstood and denigrated up to now- so the pointy hats "pointedly"
and starkly contrast the rest of his hapless sketches.

Paper Avalanche10, 9, 8, 7, 6, 5, 4, 3, 2, 1.......#1519422/9/07; 08:59:55

It's 10:00, time for the $15 smack down.

Betting that gold closes at $652.70 today. If not, as I said yesterday, this may be a brave new world that we are about to enter.


Paper AvalancheSomebody is about to lose his job#1519432/9/07; 10:22:03

I think there may be a job opening at the PPT in an hour or so if someone doesn't stem today's POG surge.


GoldiloxJob openings#1519442/9/07; 10:30:45

@ PA,

Sinclair posted a Black Box trader job (temp) opening the other day - LOL

If not their job, they'r certainly losing their shirts, or shorts, as it were . . .

TopazEuro:UST's#1519462/9/07; 11:45:35

In what so far is a vain attempt at maintaining sub $1.30 EuroX, they (the Continentals) have been throwing both T's and Euros at the market today with gay abandon.
PM's saw right through the subterfuge and smoked, confirming the Grand cross-over, ID'd here on the 01/26th, is firing on all fours.
Curiously the INO box atop the page is now reporting decimals ..a-la red .62 on Bond whereas in the past, it's been in thirty-tooths ...probably another conspiracy!!

Goldilox"The Writing is on the Wall"#1519472/9/07; 12:42:13

@ Cometose,

Some say it originated with "Kilroy was here", the grafittus left by US soldiers on their march to Berlin in '44 and '45.

If not originating then, it was certainly proliferated.

(8^) - Goldilox

Chris PowellDoug Hornig: About those IMF gold sales#1519482/9/07; 13:00:54

2:55p ET Friday, February 9, 2007

Dear Friend of GATA and Gold:

Doug Hornig of Doug Casey's International Speculator letter cites GATA and our friend Mike Kosares of Precious Metals in an analysis "About Those IMF Gold Sales." Hornig concludes:

"If IMF sales do happen and if they depress gold's price, that's a buying opportunity ... for bullion and especially for the high-quality junior exploration stocks that pack the most punch in a rising gold market."

You can find Hornig's analysis at GoldSeek here:

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

SundeckWriting on the wall#1519492/9/07; 13:07:13

"...Using these holy items, the King and his court praise 'the gods of gold and silver, bronze, iron, wood, and stone'. Immediately, the disembodied fingers of a human hand appear and write on the wall of the royal palace the words "MENE", "MENE", "TEKEL", "PARSIN" (or "UPHARSIN" in a slightly different interpretation of the word)...."

...and read on...


Sundeck...and Sir Cometose...#1519502/9/07; 13:28:58

...Australia has been running a trade deficit for as long as I can remember...even though our terms of trade are at record levels (in our favour).

We do run a fiscal surplus (lately), however, unlike the USA...but some would say that the fiscal surplus is at the expense of widespread indebtedness amongst the general public and in the corporate sector...

We do have a vibrant mining/exploration community however...


USAGOLD Daily Market ReportPage Update!#1519512/9/07; 16:04:28">
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

February 9 (Reuters) -- U.S. gold futures rallied on Friday to end more than 1 percent higher after hitting a seven-month peak amid strengthening oil prices, buying by funds and short-covering ahead of the weekend.

The COMEX April contract settled up $9.50 at $672.30 after peaking at $673.90, the loftiest level since Aug. 10.

David Meger, metals analyst at Alaron Trading, said gold rallied because of fund buying and higher energy prices. "It's not surprising that when we get these breakouts from a technical perspective, you do see fund buying on those breakouts," Meger said. Meger also noted that gold had been in a "nice, aggressive rally" since its pullback in early January when it was trading below $610 an ounce.

The April contract has gained almost 11 percent since it hit a low of $607.20 on Jan. 5

George Gero, vice president at RBC Capital Markets Global Futures, said gains came as investors positioned themselves ahead of the weekend's G7 meeting in Germany of finance ministers and central bankers of industrialized nations.

Gero said gold benefited from short-covering, buying back of futures previously sold to close out short positions, and strong energy prices and a weak yen.

The yen extended losses as doubts grew about whether finance officials at the Group of Seven in Germany this weekend would take any action to stem the Japanese currency's decline.

The dollar, however, was up against the euro, retracing some of its Thursday losses.

Oil breached the psychological mark of $60 per barrel for the first time in more than a month, driven by tightening supplies and worries about rising U.S. tensions with Iran. Iran's top authority Supreme Leader Ayatollah Ali Khamenei said Thursday Iran would target U.S. interests around the world if it came under attack.

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

TownCrierTricky business of gold trading over the border#1519522/9/07; 16:19:45

10Feb07 (The Christian Science Monitor) -- More than a century after American mining engineers first opened up North Korea's gold mines, a fortune in gold and other metals and minerals offers the prospect for North Korea to ease the pressures of financial sanctions. The question, however, is whether North Korea can navigate around a US Treasury order that forbids institutions doing business in the United States from dealing with Banco Delta Asia in Macao, the main avenue for North Korean fin-ancial dealings.

The ban, first promulgated in 2002, has effectively frozen Pyongyang's efforts to conduct international business. While it doesn't extend to gold, experts say that US officials have made it clear that banks should not buy North Korean gold.

"The US has been using sheer force to intimidate banks from dealing with North Korea," says Colin McAskill, chairman of Koryo Asia Ltd, which invests in North Korea through the Chosun Development & Investment Fund. ... "We're at a very delicate stage." North Korea, says McAskill, "wants to move back into legitimate business."

Selling gold on the London market "is one way they can prove that," he adds.

One indication of North Korea's need to sell gold was its decision to provide information needed by the London Bullion Market Association (LBMA) to list the North's central bank as a 'good deliverer' of gold and silver. Listing with the LBMA is essential for refiners who want to sell their products in London. The bank's listing was suspended two-and-a-half years ago when it failed to respond to LBMA requests for "proactive monitoring".

Despite the listing, experts say the big banks that are major buyers of gold - and form the LBMA's core membership - are not likely to flout the spirit of the US Treasury order...

At the same time, the North has sold relatively small amounts of gold in Thailand, with which it has developed a strong trading relationship in recent years. Last spring, North Korea exported 1.3 tonnes of gold to Thailand for nearly $30 million while also looking for markets elsewhere in the region.

"Why would you go to the trouble of going to London," asks Roger Barrett, whose firm, Korea Business Consultants in Beijing, is helping to develop gold mining in North Korea. "They are totally entitled to sell their gold."

With foreign expertise, North Korean mining may return to the period between 1983 to 1993, when its central bank sold an average of one tonne a month on the London market. "What we are doing is normal business," says Barrett in Beijing, explaining the efforts at reviving the mining industry. "We are creating jobs for people, in line with the UN basic charter, in line with economic growth."

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


TownCrierGraphical overview of where we've been#1519532/9/07; 16:37:57

Probably the most fundamentally sound bull market to be seen in many generations. And frankly, he's still just pawing (hoofing?) the ground. Too bad most folks will be sidelined when the real charge occurs...


GoldiloxMore "Writing on the Wall"#1519542/9/07; 17:20:10

from the Wikipedia entry posted by Sundeck:

The Oxford English Dictionary entry on writing has literary references to this phrase in English, including the following verse from the poem "The Run Upon The Bankers" by Jonathan Swift:

"A baited banker thus desponds,
From his own hand foresees his fall,
They have his soul, who have his bonds;
'Tis like the writing on the wall."

CometoseHui #1519552/9/07; 17:24:07$CRB&p=W&b=3&g=0&id=p56093444173

Didn't like that gold move today .......think the HUI smells a rat ...........

How did the CRB like it Interesting chart below

Must have been a reaction to Hales scary Commodity story

Meanwhile in the Pits what did the commercials have to do this week trading futures and options

IN SIlver the commercials
were net short 2000 contracts

IN Copper the commercials were net short 300 contracts

In GOld the commercials were net short another 13000 contracts.

I think the HUI smells a rat ...........

Rat may come to call on Monday this week.

CometoseNice one GOLDILOX#1519562/9/07; 17:27:42

and of all places to be found in this context.......
R PowellSilver PJs#1519572/9/07; 19:14:26

Goldilox, I like that idea. And are they disposable?......
happy weekend..

DruidPaper Avalanche (2/9/07; 08:59:55MT - msg#: 151942)#1519582/9/07; 19:51:41

Druid: The paper cartel is scaling up and regulating the price much like a relief valve. Until China and Russia can clearly demonstrate a military superiority, the price will hit the next defined level. Iran is the wild card and could provide the justification for paper chaos, especially directed into our paper markets. We'll all think we're rich.
GOLD FINGERG O L D....boring? #1519592/9/07; 20:44:23

Happy Golden week-----end~

It was interesting to find out how some stock brokers pegged this week as "BORING" I wonder why? Could it possible be that people are catching on to the biggest_____ going?

I think it might seem odd that they did not make the big commissions that they have been use to.

I've also heard that many Blue Chip companies have had some good performance ratings and so on. Well, if this was the case why did the stocks simple stall this week? For having such good company ratings and lack luster stock performance I wonder if the pause finally gave away to GOLD'S great performance!

I would say that this week for gold was far from boring. Now I wonder why?

All I want for my love.....IS GOLD!!


Rook.,.squeezing returns for bondholders#1519602/10/07; 07:48:31

February 6 – Bloomberg (Steve Rothwell): "Credit derivatives, the fastest-growing business on Wall Street, are squeezing returns for bondholders to an all-time low. Contracts that protect investors against defaults are being sold in record numbers and then bundled into securities known as collateralized debt obligations. CDOs are driving down the cost to protect against non-payment so much that even the government of Argentina, which reneged on $95 billion of debt five years ago, is paying less than ever to borrow. ‘CDOs are changing the economics of investing in corporate bonds,’ said Lorenzo Isla, head of structured credit research at Barclays Capital in London. ‘By expanding the investor base for corporate credit risk, they compress the spreads available to corporate bond investors.’ Bondholders have halved the amount they charge high-risk companies in the past four years to a record-low 2.6 percentage points on average over U.S. Treasury notes… CDOs that invest in derivatives of investment-grade bonds return as much as 12 percent a year, three times more than the yields on the underlying notes, according to data compiled by Barclays Capital."
mikal(No Subject)#1519612/10/07; 10:11:05

ECB's Trichet Says Carry Trade Poses Financial Risk
Bloomberg - Currencies - Feb 10, 2007
Edited, short statements from Trichet and (shallow) contradictory assessments of economic outlook out of the G7

USAGOLD / Centennial Precious Metals, Inc.SECOND EDITION -- Written for Today's Market!#1519622/10/07; 10:21:34">Gold Investing - Second Edition
TopazLoonie PoG?#1519632/10/07; 13:25:55

As the paper sages chow down in Davos it's curious to note Loonie resistance to breaching it's recent PoG high.
All other currencies were happy to soften up on Friday with the exception of Can$. (the Pound is a bad read I think).
Of course the Yen, who capitulated to PoG earlier in the week and has continued to soften, has come in for a good deal of potty-mouthing out of G7.
So the trick is to stealthily weaken your currency visavee all the others BUT somehow better or best PoG?

No wonder these blokes are so well fed.

TopazWhat the??#1519642/10/07; 13:50:34

The GBP PoG chart at galmarley looked a bit sus, so I went to find the REAL GBPPoG ...hmmm?
Galmarley = 335.39 ..the Yahoo's tell me it's 314.56 ..and the one I put my faith in (linked) is at 341.62
So I'd be buying from Yahoo ...and selling via XECom eh!

mikalEquities and gold#1519652/10/07; 14:44:10

From another gold blog yesterday:
@stock market -- trotsky, 15:34:57 02/09/07 Fri
a few data points:
1. the mutual fund cash to assets ratio is at an all time low of 3.9%
2. NYSE margin debt is only a shade below its March 2000 all time high, having expanded back to over $270 bn., from the 2002 low at about $140bn.
3. the bullish consensus is off the charts in many respects (measures such as Market Vane or Consensus Inc. have hovered close to all time record territory for weeks, and speculators hold extremely large net long positions in all stock index futures combined).

conclusion: the stock market echo-bubble will end sometime this year. the only question is when exactly. if the collapse in mortgage bonds isn't a sufficient trigger, the coming blow-up of the yen carry trade may well be. the speculative net short position in yen futures is at yet another all time record high of nearly 165,000 contracts. the underlying value of this position is staggering. when it unwinds, it will imo trigger a chain reaction across all risk assets."
Mikal-- Not much different conclusions from others we've seen. He also remains open to numerous outcomes,
a necessary perspective increasingly difficult to abide
during increasing complexity. Gold is one of the world's forces, like gravity, that gently, invisibly contain the whole financial/economic works and discipline it from becoming completely unmanagable.

contrarianCCI versus "CRB"--The Word is Spreading#1519662/10/07; 20:58:36

We are pleased to announce that this august forum is the primary source all the news that's fit to print, especially with respect to the CRB (or shall we say CCI). The hot scoop on the CCI as the true measure of the commodities trend (versus the doctored CRB) was first posted here several days ago. This information then drifted over to a day or two later, and now it has apparently just landed in the creases of the referenced article below--much to the surprise of the distinguished prognisticator author (and his subscribers I imagine as well), but NOT to the surprise of any regular reader of this excellent forum! And I might add, this forum is FREE! Isn't it nice to get SOMETHING for NOTHING! 'Nuf said!

"...we strongly suspected that the CRBr10 was not faithfully telling the story of commodities, but we had no way to prove it until I was told about the CCI last week. Despite this, since the October lows we have been aggressively buying elite high-potential commodities stocks in our newsletters to take advantage of the low prices and rotten sentiment. Most of our new trades since then have been gold-stock trades since we feel gold's young upleg has particularly exciting potential...

The bottom line is the Continuous Commodity Index, an extension of the old ninth-revision CRB's calculation methodology, components, and weighting, decisively shatters the false notion that there has been some catastrophic commodities breakdown. It is a myth. A new never-before-seen "CRB" index was driven lower by oil, but it wasn't the same index that made the secular uptrend in the first place by a long shot.

All bull markets climb an endless wall of worries and this one is no exception. Some worries are valid, others are not. Next time someone tries to get you to buy into a bearish theory based on the CRB breakdown, realize that it is utter nonsense. The true CRB never broke down and instead broke out to achieve new all-time highs recently. There is nothing remotely bearish about the ninth-revision CRB's behavior over the past six months."

Paper AvalancheGiving POG the "GOLD FINGER"#1519672/10/07; 22:26:04

Appears that the POG suppression forces are giving the market the "GOLD FINGER" over the weekend per the INO charts above.

Rats need the darkness to operate in abandon. As it relates to this forum, they sometimes send an underling to preannounce the resumption of their nefarious doings.

Be wary of those that wear their emotions on their sleeve (i.e. "I love gold!!!!!"). They may be agents of those who seek the opposite of what they outwardly embrace.

Take care,

GOLD FINGERI can see in the dark just fine!#1519682/10/07; 22:41:11

Don't be so cynical. I am sincere in my quest and ideals on gold. I wish more would be and if a small correction here and there happens it's not to worry. The statistics speak for gold. Most markets will be in for some bumpy rides. But the sparkle of my eye is the timelessness and enduring shine of GOLD!

My true love is....GOLD!

GOLD FINGERThe fact is.....#1519692/10/07; 23:10:50

I have one more thought. I was reading and/or listening to the BBC series on India.

Most fascinating how you claim that one should "be wary of those that wear their emotions on their sleeve". From what I can gather many in India do just that. It was fascinating to know how many in this most populated country view wealth, banking and the their own government and taxation.

The so called "Black market" is an underground movement that has a duel accounting system. The books are cooked to show what "they" want others to know and see (usually very modest income if not near poor).

The other is a means on how they actually accumulate their wealth and measure it. It is kept in private. It would not be unusual to find an Indian house hold hording or stashing gold, silver or other precious objects. Gold and silver are sometime melted down and stored in convenience this way. I gained some interesting insight on the Indian people. It would not surprise me one bit that most Indian people have much more than meets or MELTS in the eye. Who fooled who here?

Don't rat's like shinny objects to carry home?

I take great comfort in the fact that I am planning my future that is wrapped in gold. It's not a lie or a myth, but sheer fact that this one day will be what I have always said......the sparkle of my eye!

Have a golden weekend.

mikalDon't blame the rogues, and about those 'rogue waves'#1519702/10/07; 23:18:12

Chinese finance minister discusses world economy with G7 in Germany | People's Daily Online | February 11. 2007
This short article tries to cover a lot of ground AND cover someone's butt AT THE SAME TIME- because in the short page it mentions "global economic imbalance" three times,
"stability" three times, "economic crisis" once and peppers "developed", "developing nations" and "development"
throughout. It seems like the translator, writer and/or editor effort to mince their words(soften the message, speak euphemistically, politely) did just the opposite.

GOLD FINGERI could not resist....#1519712/10/07; 23:36:20


One day you will really kick your self in the pants when gold hits well above 1,000.00 USD.

Now, up or down gold is undervalued and always a great time to buy. Take the opportunity when it's down "a few" to get some!!

In other words less talk and more do is appropriate!

Ensure your spot in gold's future.


mikalHeavy momentum taken lightly#1519722/10/07; 23:44:05

This was a gold market in no hurry,
'Cause it loved to climb the wall of worry:
"I'll take a small rest,
Then resume my quest,
Until bears will no longer be furry.
You may take this in jest,
But keep it close to your vest-
When it's underway it will all look blurry."

TopazWhat the MkII?#1519732/11/07; 00:22:18

This IS curious, we've now got a $10 drop in PoG and all currencies now in agreement.
It's 1815hrs on Sunday eve here in OZ ...where is Gold trading on a Sunday that can tank PoG 10 Bucks?

I know ebay of late has been coughing up the odd bargain over the weekend as PoG/S climb the wall of worry, but this is rediculous!

GOLD FINGERHmmm#1519742/11/07; 00:36:01

Never Fear....

Perhaps some bank sold a 100 + tons to cover some bad debt. With all the activity in various fiat I would not be surprised. Maybe some needed to cover losses in hedge funds now that the Price of OIL is marching up. Worry.?.just a bump in my book~


TownCrierTopaz, price#1519752/11/07; 00:36:06

Looking here, there's no worries, mate.


mikal@Topaz - Re: "Mkll"- Holy(holey) mackeral?#1519762/11/07; 00:37:59

I agree. It's very fishy.
Smells like another twisted imitation of Christ's 'Miracle of the Fish'. But the loan sharks have about run out of feeding time; weekends don't satisfy them any more. Their ribs are showing...

TopazPoG#1519772/11/07; 00:46:32

Randy etal,

I looked at the INO which didn't confirm the drop as Randy points out but the Galmarley Charts AND the have both dropped ...admittedly K is still showing 666 and another (live) site I watch is at 665.1

We'll see in the morning.

GOLD FINGERG7 delegates mull EU demands#1519782/11/07; 00:54:12

Sunday, Feb 11, 2007, Page 10

The yen lost ground on Friday as G7 finance ministers met to debate European demands for action to propel the Japanese currency higher.
Traders said, however, that US and Japanese opposition was likely to see the G7 powers fail to adopt a common position on the yen's weakness.

The US dollar rose to ?21.71 around 10pm GMT from ?21.04 late in New York on Thursday.

The euro moved up to ?58.28 from ?57.82 on Thursday.

The US currency dropped against the New Taiwan dollar in Taipei on Friday, losing NT$0.039 to close at NT$32.971.

A total of US$757 million changed hands during the day's trading. The US dollar opened at NT$33.010 and fluctuated between NT$32.950 and NT$33.025.

The euro fell to US$1.3003, from US$1.3038 on Thursday.

G7 ministers and central bankers, joined by officials from key economies such as China, convened in Germany on Friday to take stock of the global economy. Disagreement seemed likely over the enfeebled yen.

The yen has fallen by 9 percent against the euro since last April, prompting fears in Europe that eurozone exports will become less competitive, so hurting a nascent economic recovery.

"It is self-evident that we will talk about exchange rates," German Finance Minister Peer Steinbrueck told an opening news conference at the G7 meeting in the city of Essen.

The 13-nation eurozone is pressing for concerted action to drive the Japanese currency higher, but the United States and Japan do not see the yen's exchange rate as a problem.

"The market thinking is that while the yen will be discussed at the G7 meeting, it will be difficult to get a consensus opinion, and so no action will be taken," said Ian Stannard, currency strategist at BNP Paribas.

Both Washington and Tokyo have suggested the Japanese currency is fairly valued by competitive markets as the world's second-largest economy is still struggling to shake off deflation.

Japanese Finance Minister Koji Omi has said that foreign exchange rates "should reflect fundamentals" of each economy, reflecting the government's view that Japan's economic recovery remains fragile.

The yen has fallen to a four-year low point against the dollar and an all-time nadir versus the euro since the Bank of Japan decided to leave its super-low interest rates on hold at 0.25 percent last month.

Commonwealth Bank of Australian senior currency strategist Richard Grace said the dollar would continue to find support over the next six months because US interest rates will remain higher than those in the eurozone and Japan.

The pound bought US$1.9493 at 10pm GMT, from US$1.9584 late on Thursday.

The US dollar stood at 1.2475 Swiss francs, from SF1.2459 on Thursday.


I am not sure that I trust anything that has G or 7 In it let alone together! be continued since I am reading a bazillion things~

mikal@Topaz#1519792/11/07; 00:56:45

Einzelwert Chart is unchanged also.

I've see this stuff happen before on weekends.
Usually it's a smaller amount that goes back up Sun. night and Monday morning into Australia and Asia.

Topazmikal#1519802/11/07; 01:11:32

Yep, the odd 0.50 here and there but $10 is a bit much eh? Galmarley recovering now but GBP/PoG still looking recalcitrant.
I wonder if this is the start of it?
Recently PoG has been thumbing it's nose at LBMA Fixes and running amok on Paper.
Real metal types might have had enough ...
...that'd be fun, but MAY not be conducive to a higher PoG in the short-term!

TopazPulsating Chart.#1519812/11/07; 01:33:00

I'd think the two Charts below (mikal and Randy) have stalled for the weekend whereas the Galmarley Chart (linked) is still huffing and puffing.
Cage RattlerWeekend trading#1519822/11/07; 04:19:04

There is no real trading over the weekend. Quite a few retail platforms are merely streaming out arbitrary or old data automatically.

"The market opens in Wellington in the morning. Anything in between New York close on Friday, and the Wellington open is not real. Anyone who wants to tell you different should go back to Macau, Vegas, or Atlantic City..."

USAGOLD / Centennial Precious Metals, Inc.Step inside and shop at your convenience. Open 24/seven.#1519832/11/07; 08:46:21

shop for gold coins
USAGOLD / Centennial Precious Metals, Inc.Inflation-adjusted retrospection gives a hint at gold's price potential...#1519842/11/07; 08:58:45">gold price potential
GonlyoldNew Dollar Coin#1519852/11/07; 09:29:00

Here's the new dollar coin being minted.
Topaz@Cage Rattler.#1519862/11/07; 10:49:00

We'll know soon enough CR as Wellington kicks off in a couple of hr's.
The issue seems to be related to a late Friday dump in GBP PoG from 341 to 335. There was no corresponding FX adjustment.
At Midnight Sat (GMT) the Currencies all re-adjusted their PoG to synchronise with GBP.
We NOW see GBP PoG drifting still lower @ 333 and US$ PoG bopping between 655 and 661.
On this basis you'd get the impression that Gold is trading "primarily" in GBP rather than USD ...and GOLD has a much larger say in things than the masters of the universe would have us believe.

TopazOf course...#1519872/11/07; 11:00:34 COULD be all related to the Wanta settlement, or Tony Blair/ Cheney arrest or Niburu or whatever but bottom line, I for one put off a multi-Oz Gold purchase over the weekend due to these PoG shennanigans ...and I'd be just one of Thousands imo.
GoldiloxPost Mkt reporting#1519882/11/07; 12:22:44

Sinclair has mentioned this a number of times. It seems one of their favorite PPT trick is to report a small sale after the bell below the closing price.

Nothing new here.

Sierra MadreSubject: a well known site has been down several days now#1519892/11/07; 13:25:39

I find it noteworthy that the well-known site, has been down for several days now.


GoldiloxGold, Oil Up#1519902/11/07; 15:22:27


Sydney, Feb 12, 2007 (ACN Newswire) - Another six month high for gold in New York as oil priceshit $US60 a barrel and worries continued to mount about the health of some parts of the US mortgage industry and some of the participants.

And it's not just gold which is reacting to the rising oil prices.

The prices of wheat, corn and sugar, raw materials for popular alternative fuels, are also becoming more volatile.

Oil rose above $US60 a barrel before settling a touch lower while the prices of some base metals, such as copper jumped as well. Gold prices roses just over three per cent last week in the US.

It's the sort of finish the Australian market likes to hear when trading starts Mondays, but Wall Street was down because of the worries about the impact of higher oil prices on inflation and those fears about the mortgage market.

New York gold for April delivery rose $US9.50, to $US672.30 an ounce on Comex division of the New York Mercantile Exchange: that almost matched the $US673.90 reached earlier in the week. That was in turn the highest price since July 17 last year.


Still holding strong in the early hours of Sydney market.

slingshotGreat Day to be A Goldbug#1519912/11/07; 15:44:15

Giving Credit where Credit is Due.

Thanks Sir TownCrier, Msg. #151975, for the Forex chart showing one heck of a gap.

USAGOLD, Msg.# 151984, POG adjusted for inflation.

Remember the $2.00 up days. Then the $6.00 up days. Add to this the $10.00 up days. Oh yes the reversals but lets keep it positive.
POG at $260.00 then $330.00 Hitting $500.00 and the spike to $725.00.

VOLATILITY! I love it! I am sure that Gold will exceed $850 yet have to rethink future plans as it approaches $1000 per ounce. Those that feel uneasy as this progresses should not feel that way.For it was them who started it all. We were just smart enough fortunate to see the signs and find this Forum.


TopazGotta admit...#1519922/11/07; 16:30:40 12 looks a lot better than green 1 eh?

How they rationalise GBP/USD will be fun to watch!

slingshotTopaz#1519932/11/07; 16:38:31

The transformatiom from pollywog to Shellback has indeed been a long endurance.


slingshotProcessing information#1519942/11/07; 17:55:29

I do not know if I am going to get my point across because as the subject states, Processing Information, for anyone can be the Make or Brake point. I spend hours reviewing editorials from this and other castles only scratching my head as to a possible outcome in the Precious Metals Market. The eradication of the M3 report and the adjustment of the CPI to name a couple that were at one time, stable and you could count on the numbers. Now I drift towards other indications oF DISTRESS amoung the people as Gasoline/ Heating oil is in a state of flux. In Mexico there was a protest as to the price of Tortillas. The price being 8 pesos and I thought this to be as the Colonist of the First 13 colonies we angered at the price of Tea and the Stamp Act. My question is, Will there be more uprisings as the inflated price of goods becomes unbearable. To say that a 50 lb. sack of rice or corn as a commodity is eqivilant to a half ounce of gold. Which is eqivalant to two goats or 100 fiat dollars. I do not know but expect that the POG reverberates from top to bottom around the world in some from or another. No one person or culture is untouched. While the IMF is off selling gold to save its skin or the CB's sell gold sell gold to surpress, there are many who wonder just what is happening to them. After all there are more misfortunates in this world. So I am thinking if the dollar is the Reserve of the World. What is going to happen when the multitudes (and I mean the down trodened) finally had enough.

I am a little off center on this topic but if you use Trickle Down Economics on a world scale, I am sure it fits.


mikalAsia gains without Japan#1519952/11/07; 18:50:59

Gold Extends Gains, Hits 7-Month High|Markets| - Singapore - February 12, 2007
Chris PowellBloomberg columnist may not know as much about gold as he thinks#1519962/11/07; 18:51:18

8:38p ET Sunday, February 11, 2007

Dear Friend of GATA and Gold:

The satirical column by Bloomberg News Service's Mark Gilbert, appended here, may be important mainly for showing that Bloomberg has heard vaguely of complaints about manipulation of the gold market, which may be a start. Your secretary/treasurer has written to Gilbert tonight with a request that he look into the issue a little more. That appeal is appended as well.

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

* * *

If Hedge Funds Kept Cows,
Your Milk Would Go Sour

By Mark Gilbert
Bloomberg News Service
Friday, February 9, 2007

A famous series of jokes attempts to define political systems.

In communism, for example, you have two cows and your commune seizes them and charges you for milk. In a democracy, you have two cows, the cows outvote you 2-1 to ban all meat and dairy products, and you go bankrupt and starve to death.

Similar thinking can be applied to financial markets. Here, then, is the world of money recast in bovine terms.

Leveraged buyouts: You have two cows. You come home from the fields one day to find Henry Kravis chatting to your spouse at the dining-room table. Two days later you have no spouse, no farm, and no table. Two guys the size of sumo wrestlers have saddled up the cows and are riding them around the farmyard.

Currency market: You have two cows. China has 1 trillion cows. Guess who sets the price of milk?

Bond market: You have two cows. One is Brazilian, one is Australian. They yield 25 quarts of milk per day. That's half as much as three years ago, when you traded your less-lactiferous German and U.S. cows for them. You are thinking of swapping for a pair of Namibian cows. They only have three legs but, hey, they produce 26 quarts per day.

Derivatives: You have two cows. You repackage five of them into a Collateralized Lactating Obligation, pay for a AAA credit rating, and slice the CLO into 10 pieces and sell it to investors, skimming the cream from the milk for yourself. Three of the cows fall ill and the credit rating plummets. You get to keep the cream.

Hedge funds: You have two cows. A guy in an open-necked shirt drives up in his Bentley and offers to take care of them for you in return for a year's supply of steak and 50 percent of their milk. They won't be allowed to leave his compound for two years. Six months later, you have half a cow, producing sour milk. "You have to be willing to lose rump today to get rib-eye tomorrow," the hedge-fund guy mumbles through a mouthful of sirloin and champagne.

Economics: Assume two cows.

Carbon-emissions trading: You have two cows. They produce 1.2 tons of methane gas per day. After a hefty donation to the re-election campaign of your local representative, the government gives you enough emission permits for six cows. You sell three permits, buy another cow, and apply for a European Commission grant to build a methane-gas power station.

Microsoft Corp.: You have one old, tired cow. A recent heart transplant may have come too late to save the beast.

Google Inc.: You have no cows. You slap advertisements on everyone else's cows. The milk floods in. You use the proceeds to reinvent the cow.

Apple Inc.: Nobody wants your cows. You design the cutest little milk bottle. Now everybody wants your cows.

Goldman Sachs Group Inc.: You have 26,467 cows. They are strapped into the milking machines 24/7. Some of them have more hay than they could ever hope to eat. Others aspire to one day having more hay than they could ever hope to eat. The cows with the most hay end up with big government jobs.

Pension-fund management: You have two cows. How boring is that? You pay a month's supply of milk to a consultant, who advises you to sell one cow and buy two aardvarks instead. The aardvarks die. The consultant charges you four months of your (now reduced) milk supply and advises you to sell half of your remaining cow and buy a wombat. The wombat dies. The consultant charges eight months of milk for a copy of his new report, "Two-Cow Strategies for Alleviating the Impending Pensions Crisis."

Russian energy: You have two cows. Comrade, those cows are an environmental hazard. We suggest you hand one of them over to us.

Credit-default swaps: You have two cows. You buy insurance against them dying and tuck the contracts into the middle of that tottering pile of documentation on your desk. One dark night Henry Kravis sneaks off with your cows. By the time you track down the paperwork, your now-worthless contracts have expired.

Interest-rate swaps: You have two cows. You pledge one of them to me as collateral in a swap for some of my pigs. I pledge the cow to my neighbor as collateral in a swap for some of his sheep. He pledges the cow to his cousin as collateral in a swap for some of his cousin's goats. Better pray the livestock market doesn't crash and we have to try and round up that cow.

Commodities: You have lots of stocks and bonds but no cows. Are you crazy? Cows are the hot new market. Here, buy this exchange-traded cow futures contract. It can't lose. It gained 40 percent in the past six months.

Gold: You have two cows. You wear a cap you made out of tin foil so that the tiny black helicopters can't read your thoughts. You spend your days blogging about how the government's decision to abandon the cattle standard in 1933 was part of a global conspiracy by the world's central banks to destroy the value of your herd.


Mark Gilbert is a Bloomberg News columnist. The opinions expressed are his own.

* * *

Sunday, February 11, 2007

Dear Mr. Gilbert:

When I read your Feb. 9 column's crack at those who complain about central bank manipulation of the gold market, I had to wonder whether you were aware of the speech given in June 2005 by William S. White, head of the Monetary and Economic Department of the Bank for International Settlements in Basel, Switzerland.

White said that manipulating the gold market is a primary purpose of international central bank cooperation:

I'll attach an original copy of White's speech.

The manipulation of the gold market by central banks is far more than the hallucination of people who wear tin-foil hats; it is simply a matter of public policy and public record, ascertainable in any number of ways, even as it has yet to provoke much interest from financial journalists.

If you managed to interview White about what he and the BIS know about the gold market and what central banks do there and why they do it, it might make a very interesting story, even if it would require a little more effort than making fun of an issue you may not know as much about as you think.

With good wishes.

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

slingshotThat's It !#1519972/11/07; 19:36:17

I need one of those "Tin Foil Hats"
My Mickey Mouse Hat don"t work anymore.

mikalLetter writer wants ECB to intervene#1519982/11/07; 19:45:19

How an ECB Intervention Could Help - / Comment & analysis / Letters / 02-12-07

Mikal--> This sort of CB intervention "to lower the euro/yen exchange rate cross" is nothing new as the writer documents.
The fact remains, inflation/devaluaton of currencies through official money supply and the rapid acceleration of it's proxies such as corporate bond issuance mortgages and derivatives, ensures the cheapening of the euro and the yen vs gold- almost making the US $ look good!
POG in euros continues to demonstrate outsized returns
while (it's chart is)signalling favorable new entry points again and again.

slingshotChris Powell msg# 151996#1519992/11/07; 19:57:45

I did enjoy your post but wanted to ask you if gold has different prices for the same commodity from different parts of the world. Example sweet crude. One barrel from Saudi Arabia and another from Africa. Why I ask is that one barrel may have more taxes or whaterver, even as the POO on the international market may be lower.
You can use Beef if you want too.

mikalPlanet Wall St. drones on, 'This time it's different'...#1520002/11/07; 20:15:09

Four dangerous words we must remember as false warnings of financial crisis lead to overconfidence / Comment & analysis / Letters - Saturday, Feb 10 07

slingshotWhy should you own gold#1520012/11/07; 20:35:55

I am spooling up over a few points that cascade in my mind. Some I have control over, while others I do not. What I do take offense to is the ever ending hype given to certain products. Over speculation at its finest. Price gauging at the least. The only answer is Supply and Demand with a Moral foundation. It use to be you could buy something without no hidden costs. Now it is the norm.
Call it taxes.

To point out I did make note to another Knights post about taxes and though we do not say it, Gold is the answer.

flow5The dollar's convertibility into gold was caused by our military#1520022/11/07; 21:06:16

The U.S. had a net liquidity deficit in every year since 1950 (with the exception of 1957), Up to 1976 (when the private sector contributed its first trade deficit ) these deficits were entirely the consequence of excessive U.S. government unilateral transfers to foreigners (re: foreign policy – solely our far flung military bases and personnel). During all this time the private sector was running a surplus in all accounts: merchandise, services and financial. The Vietnam Ten-year War administered the coup d’etat to our gold bullion standard. By 1968, in an effort to keep the dollar at the $35 par, we had exhausted nearly two thirds of our monetary gold stocks, or approximately 700 million ounces to about 260 million ounces.
slingshotHello flow5#1520032/11/07; 21:16:06

First Time Poster?
Hope to see more from you. That also goes for the rest of you lurkers. Newbies and first time investors. I want to hear from you. This Forum is the best. I have been posting for close to Five years? The responses to my questions have been most informative. They have a passive eye to my poor punctuation and spelling ;0)

slingshotflow5#1520052/11/07; 21:24:12


flow5Gold Standard#1520062/11/07; 21:44:44

There are increasing numbers of advocates for the adoption of some form of gold standard. Gold standards of whatever type, gold coin, bullion or some modification of the gold bullion standard, all require that the unit of account be defined in terms of gold of a certain fineness, e.g., one dollar equals 25 grains, 9/10 fine, thus establishing the mint price. The other sine-qua-non requires the government, acting directly or through the agency of a central bank, to stand ready at all times to buy or sell gold at the mint price.

An operating old standard creates, or is associated with, many advantages: 1) stable foreign exchange rates; 2) free multilateral clearing of currencies among nations; 3) the maximization of multilateral foreign trade; and, 4) relatively stable price levels e.g., no chronic inflation. All that is required to achieve this economic utopia is a 1) world free of major wars, depressions and cartels (OPECs); 2) markets with downward price flexibility, that is , true price competition; 3) creditor nations which impose no significant restraints on imports; 4) monetary authorities who abide by the "rules of the game", i.e., the central banks expand credit (create commercial bank legal reserves) when gold stocks expand, and vice versa; 5) monetary authorities who restrict the expansion an d contraction of central bank credit within a very narrow range, thus preventing the commercial banks from creating an unsupportable volume of credit money (demand deposits); and, finally, 6) a world where the reserve currency countries (those countries whose currency serves as a store and standard of value as well as a transactions currency) never operate with chronic deficits in their balance of payments.

Note: deficits or surpluses refer to changes in a country's gold stocks and net short-term claims (demand deposits, CDs, commercial paper, etc. – the "balancing items" in the balance of payments.) deficits result from gold exports and/or a decrease in short-term claims against foreigners relative to the short-term claims held by foreigners. The reverse is true for surpluses.

From 1816-1914 these conditions were achieved under the aegis of the Bank of England to an extent sufficient to provide international trade, and the British domestic economy, with all the advantages of a free gold standard. This period marked the heyday of the gold standard. The British pound sterling was the reserve and transactions currency of the world. International transactions were financed largely by transfers on the books of the "big five" London banks, thus minimizing the necessity to transport gold. So great was the faith in the convertibility of the pound sterling, that the Bank of England could, and did, operate with relatively small gold reserves. A change in the central bank's discount rate, or a small change in the buying price of gold (not a devaluation or a revaluation, but simply a change in the price sufficient to offset implicit interest and shipping costs) usually was enough to prevent significant or unnecessary outflows of gold.

World War I ended all this. Attempts to restore the gold standard in the 1920's were swallowed up in the Great Depression. For most of the period from the end of World War I to 1968, the world was on a U.S. dollar standard, but never a free gold standard. World War I transformed the U.S. into a creditor nation, left our industrial capacity expanded and intact, and set in motion forces which made our economy the safest haven for foreign capital seeking escape from foreign nationalization. World War II and the Great Depression accentuated these trends. But the U.S. tended to ignore its responsibilities as the world's principal creditor nation and reserve currency custodian. We severely restricted imports through sky-high tariffs (Hawley-Smoot, 1931, for example), customs red tape, commodity classifications and other devices. The volume of Federal Reserve Bank credit was determined more by domestic considerations than by gold flows.
In April, 1933 we nationalized gold, made the dollar inconvertible and by administrative fiat capriciously raised the dollar price of gold in a series of steps from $20.67 to $35 per ounce. All of this was done even though were a creditor nation and had a chronic surplus in our balance of payments. In January, 1934 the Congress codified these administrative actions into law. Under this modified gold b bullion standard, the dollar was convertible on foreign, but not domestic account at $35 per ounce.

Before we commit ourselves to the naïve proposition that a successful gold standard requires only an Act of Congress, we should examine the reasons for the abandonment of gold convertibility in March, 1968. That was the month and year the U.S. Treasury ceased to sell gold on the open market. No longer could foreigners buy gold and the London or any other exchange at $35 per once.

The U.S. Treasury held approximately two thirds of the world's monetary fold stocks in 1949. They resulted from years of surpluses in our balance of trade and "flights" from foreign currencies. In 1949, the U.S. dollar was not only as "good as gold", but it was also preferred over gold. There were not enough dollars to finance the legitimate needs of the world economy.

With the outbreak of the Korean War in 1950 surpluses turned to deficits. With the sole exception of 1957, these deficits (usually of increasing magnitude) have characterized our balance of pay6ments in every year since. For the first few years, the deficits were beneficial. But a good thing can be over done and we did it. In our efforts to police the world, we overcommitted ourselves. This zealotry finally leg to the escalation of the Vietnam War in 1965 and the subsequent demise of the dollar as the reserve currency of the world.

Note: Until 1971, the private sector always operated with a surplus. These surpluses were more than offset by the excessive unilateral foreign transfers by the Federal Government. Since 1971, the Federal Government can share the blame. U.S. industry has become less competitive, but the principal villain (since 1973) has been OPEC.

By the mid 1960's foreigners found themselves in possession of excessive dollar balances, excessive in terms of the n needs of trade. Some of these excess dollars came to be used as "prudential" reserves in the formation and growth of the Euro-dollar banking system. Other excess dollars were used to buy our under priced gold (under priced as a consequence of chronic inflation). Our gold stocks, which were about 700 million ounces in 1949, had fallen to about 260 million ounces by March, 1968. Had the Treasury not abandoned its effects to maintain the equality of the market price with the mint price, our entire monetary gold stocks probably would have been depleted by the end of 1968.

Paradoxically, the Euro-dollar System, (now a foreign-dollar prudential reserve banking system) which was established both because the dollar was in excess supply and the reserve currency of the world, is now one of the principal factors militating against any attempt to reestablish the convertibility of the dollar into gold's at a fixed price. We are not even willing to give the Fed the degree of control over our own domestic money creating institutions.

Regardless of whether or not our objective is establishing a gold standard, the situation requires measures be taken which well reverse the deterioration of the dollar's integrity. What is required is no less than an end to the chronic liquidity deficits in our balance of payments, and a halt to the excessive creation of U.S. and Euro-credit/ Foreign-credit dollars. But the alternative is, at some point in time, a flight from the U.S. dollar and, therefore, the Euro-dollar/Foreign-dollar. This will generate hyperinflation in terms of U.S. and Euro/Yen/Yaun/Petro/-dollars, etc., and an international financial crisis of unprecedented proportions

slingshotQuestion#1520072/11/07; 21:44:55

Would somebody explain to me why it is so hard to talk about GOLD?
We talk about cars, taxes, world events,gas, price of meat, booze, cigs and so forth. Mention gold and everyone clams up! Heck USAGOLD has over 10 thousand entries and just a few hundred post. I talk about gold and my wife hears me every day. (you have to know me) There are plenty of things that are important in this world and gold is one of them. Especially for financial survival.

This may be a contest question. Sir M.K. I would not validate this contest unless there was at least 150 entries or 10% of the total listed posters.


Sierra MadreWhy gold is "so hard to talk about"....#1520082/11/07; 22:11:56

The reason is: because it is so important.

Social life revolves around the trivial. Talk about what is important, and you are being anti-social.

A phrase from a Cole Porter song comes to mind: "Most men don't like love, they just like to kick it around."

People - the little man, who represents the multitude, is afraid, terribly afraid. Fear is in the air. The little man does not want to talk about that which brings his fear into his consciousness. He wants to keep it out of his mind, he does not want to face his fear.

Gold makes him think, and the little man does not want to think. Thinking would bring up his fear, which he is trying to forget.

That's why it is so hard to talk about gold - to little men. And most men are little men - little in spirit.


slingshotSierra Madre/fear#1520092/11/07; 22:33:31

Your discription of the little man is wide open. I do agree with you is that fear is a driving force.
The little man around the world recognizes gold for what it is eventhough not understanding the dollar price set upon it. While the stock market investor fears that his paper weath can desintergrate if he can not sell his stock before the buyers dry up.But the individual, Little in Spirit, will not see or refuse to see, what lies on the horizon.

Thank you Sierra Madre for your reply. I am trying to sort out who will be buyers of gold as it progresses higher.

That is, will there be more smaller buyers than big buyers.

slingshotThis is very callous#1520102/11/07; 23:17:36

If USAGOLD finds this offensive. Please delete.
I only ask this as to acquire some reassurance as the rush to gold accelerates.
It has been stated that there is less than one ounce of gold per person in the world. To state that, we at USAGOLD are most fortunate. But I want to extend. To reach out to the world on the web and ask, "Does I.Q. have anything to do with the acqisition of gold wealth?"

We have always talked about higher classes. I want know about the underlying factors.

Is there some PhD that can fill in the blanks.

It's the things that come out of nowhere that get you!

GOLD FINGER*****NEW FLASH***** GOLD HITS 1,000.00 per ounce!!!!#1520112/11/07; 23:23:01


Oh yes, this is perhaps an area of huge discussion. Imagine if tomorrow morning you opened up your favorite new article to find this.

GOLD reaches an all time high of 1,000.00 per ounce.

What do you think people will FEELING? I bet they will be wondering what calamity has just hit!

Now, this is all tied up in the emotional gold. I have always said gold was an emotional metal and I do think you hit it on the dot or spot.


That's why you only hear the happy chimes or music being played when the stock market is up or down. I guess it would kill them to every talk about gold this way? I do believe they are afraid to promote it one once further! I need to ponder on this one!!


slingshotGold Finger#1520122/11/07; 23:30:43

You miss the point.
Gold from $254 to $665 is remarkable. Consider the implecations when gold hits $2000 and that is not inflation adjusted.

slingshotContest extravenaire!#1520132/12/07; 00:17:09

Forget the spelling!

I Slingshot want to have a contest. I Slingshot, will purchase TWO (2) America Silver Eagles for a contest from USAGOLD/CPM Precious Metals. Those wanting to up the ante may do so by buying from CPM.

They have gave alot. Its time we gave back.

USAGOLD has the right to call the contest question.

968China consumed 300 tons of gold in '06#1520182/12/07; 01:34:28

Chinanews, Beijing, Feb. 10 – In 2006, China's gold output exceeded 240 tons, increasing by 7.1% from 2005. During the same period, China consumed 300 tons of gold, said Lu Wenyuan, deputy chairman of the China Gold Association on Thursday.

Since China opened its gold market in 2002, the country's gold output has grown by 6% year on year. At the same time, gold consumption has also increased. In 2005, China became the world's fourth biggest gold producer and the world's third biggest country for gold consumer.

Due to backward techniques, there are also some problems in China's gold consumption. Although China is a large country in gold consumption, it is not actually a strong country in this aspect, since most of Chinese gold enterprises merely process gold jewelleries for Italy and other Western countries. China processes a lot of gold products without much designing work.

In China, most of the gold products are bought by elderly people, since they are the group that are influenced by the Chinese tradition by which gold and silver jewellries are regarded as symbols of wealth. Not many young people in China favor these gold products, because they are not designed in fashionable styles and also because many young people think that wearing gold is a manifestation of low taste.

In order to change the situation, the China Gold Association will begin to launch a series of new gold products from March. All these products, which share the common name of "China fashion", are all designed by Chinese designers, who incorporate traditional elements and modern styles in their designs. It is hoped that the new products will stimulate the gold consumption market in China.

slingshotHello#1520192/12/07; 01:39:56

Hello 968. It has been a long night.
Slingshot --------------<>

TopazSomething IS up!#1520202/12/07; 02:23:41

Don't want to labour the point too much but INO PoG and Euro charts now showing a precis version of the w-end frolics,
Euro again seeking to get below 1.30 ...I wish them well!

slingshotTopaz#1520212/12/07; 02:24:13

Are you out there?

Topaz...and the Pound#1520222/12/07; 02:30:34

G'day Mr Shot coaxed a good effort out of Sir flow5 eh? welcome FF.
slingshotTopaz#1520232/12/07; 02:31:56

Hey Mate,
Missed you buy less than a minute in the time travel.
What say you about my contest?

Topaz...and just to add to the intrigue,#1520242/12/07; 02:34:32

...K's graph has stalled at London open ...I can't watch!!
968Gold fever hits China ahead of lunar new year#1520252/12/07; 02:34:55

SHANGHAI (Reuters Life!) - Golden hogs are flying off the shelves as China prepares to welcome the Year of the Pig.

Chinese consumers are thronging jewellery stores to buy gold trinkets and accessories to usher in the lunar new year, which starts on Feb. 18, in style -- and with lots of luck.

TopazHey slingy#1520262/12/07; 02:41:31

You might need your sleep mate, it could get interesting today.
GoldiloxGolden Hogs#1520272/12/07; 02:46:50

@ 968,

Not to mention, them golden piggies are darn cute!

slingshot968#1520282/12/07; 02:49:26

You want to talk about Hogs? Wild Hogs. I can tell you they are the most deadly creatures on earth. Forget about Porky Pig. Have a 300lb with 6 in. tusks charge you and that changes everything.I know for sure. If this is the year of the Hog. Look OUT!

GoldiloxNo weekend antics#1520292/12/07; 02:52:51

at Netdania out of Oz.
TopazLast one I promise ...Eur/GBP.#1520312/12/07; 03:02:40

There was hell to pay over the w-end Goldie.
slingshotgraphs#1520332/12/07; 03:06:13

I'm looking at them with major gaps

TopazG'lox ...Net-Dania.#1520342/12/07; 03:11:29

Data feed from secondary source I think (Comstock Lite), notice there's no weekends, INO had to fill theirs after the event.
Swings too big to be irrelevant imo.

GoldiloxChina's trade surplus jumps 67%#1520352/12/07; 03:17:35


China's trade surplus jumped 67% in January, a development that is likely to increase pressure on Beijing to allow its currency to float freely.
Last month China exported $15.9bn (£8.2bn) more goods and services than it imported, compared with $9.5bn for the same month a year earlier.

Although the rise was inflated by seasonal factors, the West has long said the yuan is undervalued.

While Beijing denies this, a low yuan makes Chinese exports cheaper.

Growing pressure

On Friday, the G7 finance minister from the world's leading industrial countries called on China to increase its currency flexibility.

At present China only allows the yuan to trade in a very narrow field against the dollar, but it has long pledged to allow the yuan to trade more freely as and when this is possible.

China says it needs to be cautious about this to prevent unsettling its economy.

Its exports rose 33% in January compared to the same month a year earlier, while its imports grew 27.5%, both beating market expectations.

The figures for January 2007 were inflated by the late running this year of the Chinese New Year.

This is not taking place this year until later this month, which meant more January trading days.

China's trade surplus with the European Union reached $26.4bn in January, while that with the US totalled $23.41bn.

Its overall trade suplus for 2006 hit a new record of $177.47, up 74% on 2005.


Good thing Globalism is "managing" those imbalances.

slingshotTopaz#1520362/12/07; 03:17:55

Let me tell you my friend, As the POG goes I may be down to see you if you will have me?

TopazSlingshot#1520372/12/07; 03:22:01

What is it you want of me sire/ma'am?
It is late and I must sleep shortly.
I'm done jousting, but per chance if you are of the fairer sex we might move to the back row and do kissing eh?

Topaz...and I up to see you. #1520382/12/07; 03:25:05 PoG goes of course.
My last visit say me part with many hundreds of FRN's to acquire a Bellagio $10 Limited edition Silver Token.
I think I got the better of em!

slingshotContest . 2 silver american eagles#1520412/12/07; 04:15:21

I stand by my word for two american silver eagles for a contest. The question to be asked By USAGOLD.

KnallgoldGOLD FINGER#1520432/12/07; 04:26:32

With every thousand yardstick,we're getting closer to FreeGold.So its hope which grows with the numbers,not fear.Fear will have only those short Gold and all Goldhaters!
slingshotKnallgold#1520442/12/07; 04:29:20

Good Morning.

slingshotUSAGOLD#1520452/12/07; 04:44:28

Oh Lord I got to thinking. I know I can asked for my own contest but to ask others to contribute may be gambling. I am stupid and in no way want to jepardise this forum, forgive me.

ThoreaulyWhy is gold so hard to talk about?#1520462/12/07; 06:47:50

As the great French philosopher Blaise Pascal said, "Ordinary people have the ability not to think about things they do not want to think about." And it is this, in fact, that makes them ordinary. Ask the man of the street what money is, and he'll stand there slack-jawed, having been brainwashed into believing that money is such a mysterious thing that only temple priests can understand it and therefore disseminate it.

Or as one of those who benefitted from the mystery put it many decades ago: "It is well enough that people of the nation do not understand our banking and monetary sytem, for if they did, I believe there would be a revolution before tomorrow morning." -- Henry Ford

mikalStories making the news#1520472/12/07; 07:18:54

Oil slips on Saudi, Qatar comments - Reuters 2-12-07
The Currency Foil - Morgan Stanley Feb 11
Fed's Fisher won't rule out further rate hikes - Reuters 2/09/07
It's a Great Country, Especially if You're Rich - NY Times 2/11/07
Wall Street Waits for Bernanke - AP 2-11-07
U.S. Inquiry on Bonds at Big Bank - NY Times 2/10/07
Economic Powers to Study Growing Influence of Hedge Funds - NY Times 2-11-07
The Short View: On junk bonds - FT Feb 11
SEC slammed over hedge fund 'wealth' test - CNN/Money
Hedge Funds Start to Look Like Risky Bets - WSJ 2-12-07
G-7 Officials Urge Investors to Avoid `One-Way´ Bets - Bloomberg Feb 12
Germany's hedge fund plan wins G7 support - FT Feb 11
US slowdown looms as groups miss targets - FT 2/11/07
Pressure's rising for Ford dealers - Dallas MN 02/12/07 Apartment, condo construction to slow - Dallas MN Feb 11
India Finds Its Economy on the Verge of Overheating - NY Times 02/10/07
China's January Trade Surplus Swells to $15.9 Billion - Bloomberg 02-12-2007
India Industrial Production Surged 11.1% in December - Bloomberg - Feb 12, 2007

USAGOLD / Centennial Precious Metals, Inc.A special package for those taking their first step...#1520482/12/07; 08:19:36">gold ownership starter kit
mikal(No Subject)#1520492/12/07; 08:39:42 Chinese Investors Snapping up Gold Ahead of Lunar New Year
ChannelNewsAsia | February 12, 2007

mikal(No Subject)#1520502/12/07; 08:50:32

US Hurts Asia With Addiction to Dollar Status - William
Pesek - / Business / Opinion / Feb 12, 2007

TownCrierIMF's de Rato says G-7 countries open minded on gold#1520512/12/07; 09:10:48

11 Feb 2007 -- International Monetary Fund Managing Director Rodrigo Rato said the Group of Seven leading industrialized nations were "open-minded" about allowing the fund to sell part of its gold reserves.

An advisory panel said last month the fund should sell 400 metric tons of gold, valued at about $6.6 billion, and invest the proceeds in interest-bearing assets.

De Rato said he discussed a new income model for the IMF, which has seen its loan portfolio shrink, while attending the meeting of G-7 finance ministers and central bankers in Essen, Germany, yesterday. "There is an open-minded attitude toward the report," de Rato said.

IMF Managing Director Rodrigo Rato is seeking to reduce the fund's financial dependence on loans to crisis-stricken nations. The IMF forecasts a loss of $102 million this financial year after countries including Brazil and Argentina repaid loans early.

The IMF is the world's third-largest holder of gold, after the US and Germany, with reserves of 103 million ounces, worth about $65 billion.

Proponents of gold sales must overcome opposition from the US, the world's third-largest producer of gold, which has veto power over the decision. In November, Treasury spokeswoman Brookly McLaughlin, said gold sales aren't "the appropriate option at this time for dealing with funding issues at the IMF."

Treasury Secretary Henry Paulson sounded a more conciliatory note on Friday, saying: "We are still in listening and studying mode."

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

Regarding cash flow, the IMF's income model would shift as its lending efforts are essentially redirected from Third World/developing nations with crisis economies toward lending it's financial support instead to the more industrialized/developed world. After all, that's precisely what "investing in interest-bearing assets" here represents -- the purchase of bonds. Will they be primarily U.S. and/or Dollar-denominated bonds?

Regarding the flow of gold, if this reaches the open market, it will buy us a little time. If, however, it is delivered to China's official (reserve) doorstep, it will hasten the world's readiness to transition out of the generally out-of-favor dollar-centric reserve structure of the international monetary system.

The level playing field pivots and adjusts upon a golden fulcrum.


Clink!Monday morning smackdown ?#1520522/12/07; 09:48:53

Not to speak prematurely, but it seems to me that the anticipated hit to the PoG - as telegraphed by the swoon in the miner share prices on Friday afternoon - has been remarkably feeble so far. The two key times - NY open and London close - are easily discernable in the PoS, but show hardly a ripple on the PoG.


PS. OK, now watch it fall like a rock .......

TownCrierHEADLINE: Timing the Gold Bull: Fireworks on the Horizon#1520532/12/07; 09:51:21

Feb 12th, 2007 -- Timing is everything and now is the time to be positioned in gold, silver and energy.

We are about witness the largest upleg of the gold bull, wave III, which will make the gains of the dotcom boom seem like minor blips on the radar...

...considering the population of India, their improving economic conditions (i.e. more capital and discretionary income available for investment) and love for shiny metal, we are anticipating significant upward pressure on the price of gold.
The Russian Central Bank ... have been discussing such a move for a while and are amongst a growing list of countries diversifying their foreign reserves away from U.S. dollars. Bad for the greenback - good for gold.

Technicals Forecast Big Move Up

For the past 10 months, the price chart for gold has been compressing (making lower highs and higher lows). Think of it as a spring, which has been pushed continually tighter and is now coiled and loaded with high levels of potential energy. When the spring finally releases, the floodgates will be let loose and the price will explode upwards.

The gold price is above both the 50-day and 200-day moving averages and both of these averages are trending upwards. We are in the midst of a rally that typically follows the golden crossover (50-day moving average crossing through 200-day moving average) and it is our opinion that the rally is just getting started. If gold can hold above $650 a few more days, we are set for a major move back towards $720. There is literally no resistance between these two points.

While gold above $720 will be a welcome event, we are still sticking to our forecast for gold reaching above the $1,000 mark sometime in 2007. Tall order? One needs only remember that gold today would be priced near $2,000 per ounce if it were adjusted for inflation.

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

In speaking of inflation adjustments, rather than saying "gold today would be priced..." doesn't he mean that the PRIOR high-water-mark in gold would be $2,000 if it were adjusted for inflation?

Of equal or more importance, however, is the understanding that gold today could/would be priced near or beyond $2,000 if the physical market were liberated from the price-suppressing effect of the tidal wave of paper gold that has artificially inflated the apparent supply of yellow assets to satisfy the market's widespread needs for a dollar antidote.

Spread so remarkably thin, the effect wrought by this paper will fall away as confidence in the shell-game wanes. More to the point, this is more truly what will lead to the "fireworks" on the horizon.

Choose your gold in PHYSICAL form, sit back, and calmly take in the view.


GoldiloxUS position on IMF gold sales#1520542/12/07; 10:13:32

I would worry more if Paulsen said that the US was "behind" IMF gold sales, as it would suggest to me that they were considering Rooseveltian methods to re-acquire it.

Just MHO.


TownCrierGood primer commentary by Kenneth Rogoff#1520552/12/07; 10:18:18

Betting With the House's Money

Many people have been asking why the dollar hasn't crashed yet. Will the United States ever face a bill for the string of massive trade deficits that it has been running for more than a decade? Including interest payments on past deficits, the tab for 2006 alone was over $800 billion dollars – roughly 6.5% of US gross national product. Even more staggeringly, US borrowing now soaks up more than two-thirds of the combined excess savings of all the surplus countries in the world, including China, Japan, Germany, and the OPEC states.

Foreigners are hardly reaping great returns on investing in the US. On the contrary, they typically get significantly lower returns than Americans get on their investments abroad. In an era in which stock and housing prices are soaring, the central banks of Japan and China are holding almost two trillion dollars worth of low-interest bonds. A very large share of these are US treasury bonds and mortgages. This enormous subsidy to American taxpayers is, in many ways, the world's largest foreign aid program.

Overall, after almost 25 years of stunning prosperity, punctuated by only two mild recessions, most Americans feel pretty confident about their economic situation. ... People have enjoyed such huge capital gains over the past decade that most feel like gamblers on a long winning streak. By now, they see themselves as playing with the house's (or their houses’) money.

...this cannot be the long-run trend. is not hard to imagine scenarios in which the dollar collapses. Nuclear terrorism, a slowdown in China, or a sharp escalation of violence in the Middle East could all blow the lid off the current economic dynamic.

...some day, the US may well have to pay the bill for its spendthrift ways. When that day arrives, Americans had better pray that their creditors will be as happy to accept dollars as they are now.

^---(see full article at url)---^

Thanks for the link, G.

That final sentence, very calmly delivered, is nonetheless the most sobering single thought a person could dwell on to properly wrap their mind around the nature of this whole gold/savings/reserve affair.

Call USAGOLD-Centennial for an insightful consultation on a gold-diversification strategy that's right for you. 1-800-869-5115 (Also, be sure to avail yourself of the very very FREE and EASY Gold Info Packet made available to you at the link atop this page.)


flow5China -- a time bomb#1520562/12/07; 10:30:34

In foreign trade, imports decrease the money supply of the importing country (U.S.) while exports increase the money supply, and the potential money supply, of the exporting country (China). Purchasing the deficit countries currency and then purchasing U.S. treasury bills (1.05 trillion by year ending 2006), will reduce the dollar's supply, but it is important to know that sooner or later the Chinese central bank will have to reverse their positions and the foreign exchange dealers know this (gold will rise at this juncture).
The trade-off of reducing the pressure on the global dollar by temporarily decreasing the volume of the dollars requiring conversion into Yaun, is the cost of foisting an inflationary policy on China. Obviously, and for good reason, the Chinese have reason to resist this kind of assistance. But in order to keep a competitive advantage, and the Yaun low, and exports high, as China is export dependent for full employment, the Chinese "sterilize" their foreign exchange reserves. That is, the Chinese "mop up" the increase in the Yaun money supply by selling government bonds. This converts surplus Yaun into government debt and delays the inflationary impact of an otherwise increase in the volume of Yuan. But at some future point, as exchange rate reserves grow, the Chinese capital markets will lose their ability to absorb new debt. China's protectionism (currency peg) will crack, and the volume of Yuan will fuel inflation.
The Chinese have been desperately 1) selling lots of government bonds to their domestic credit markets, and 2) raising commercial bank reserve ratios (to monetize the debt). Both 1 & 2 are to "sterilize" their foreign exchange reserves, and postpone the inevitable. If there is a flight from the dollar, it will be because the Chinese waited too long to realign the Yuan. The NAM believes that the Yuan is undervalued by as much as 40 percent.

Until July 2005, China's currency had been fixed at an exchange rate of 8.27 yuan per dollar - since 1994. As of Jan 2007, its currency has risen 6.2% since the currency peg ended July 2005 (to 7.7949 per dollar). Real GDP has grown an average of 9.6 percent in the past five years. With an export driven economy, China's foreign-exchange reserves have risen to $1 trillion. Shanghai and Shenzhen stock exchanges were up over 300% in 2006 to 35x earnings and a $1.01 trillion valuation.

TownCrierflow5, you may want to reevaluate your opening premise#1520572/12/07; 11:00:07

You said, "Purchasing the deficit countries' currency and then purchasing U.S. treasury bills (1.05 trillion by year ending 2006), will reduce the dollar's supply..."

Upon giving it a bit more consideration, wouldn't you rather conclude that the purchase of the U.S. Treasuries actually serves very effectively to facilitate the recycling of those same dollars back to U.S. shores, thus nullifying the reduction in (our) money supply as you've posited in your presentation?


Cometoseoil Down big#1520582/12/07; 11:39:35

Braking on the metals ...............letting the air out of the CRude oil baloon .............

This could go on for a while till it gets down to 55 maybe lower..........

propping up mr Dollar or

The metals may just decide to take off on their own in honor of this festive YEAR OF THE PIG ( that's svine to the Pigs at PPT GOLD MAN SACHS , THE FED , JP MORGAN and the pitiful pit poindexters that help them .........

Beware to whom ye sell yer souls , he it is who holds your bonds,,,,,,,,,and beware of the CRACKING.........and DAVY JONES LOCKER

Be it known to you lads , that THE PROPHET hath said that the crooked ways, they shall be straightened........and on that day ,,,,, you might well have a shards of lightnin to cure your rheumatism in your LOST PATHWAY

GOLD may have a whack at your first the here and now ...and give you over to a personal prolonged MAALOX DECADE

GoldiloxNice post-COMIX rebound#1520592/12/07; 12:01:43

The COMIX smack down did not breach $660, so we're already seeing some rebuilding in after-hours.
968Qatar ‘to consider selling gas in euros’#1520602/12/07; 12:11:36

QATAR, the world's largest shipper of natural gas, will consider selling gas in euros, instead of dollars, HE the Finance Minister Yousef Hussain Kamal said, reducing global demand for the US currency.
flow5Recycling the Dollar#1520612/12/07; 12:13:59

Thank you, yes, didn't think it through, forgot a step.
Shouldn't gold be consolidating? There should be downward pressure from the seasonals. Otherwise gold is showing real strenght. Gold's price should accelerate after the middle of March.

flow5Monetary Flows (MVt)#1520622/12/07; 12:40:12

First, there is no ambiguity in forecasts. Forecasts are mathematically "precise" (1) nominal GDP is measured by monetary flows (MVt); (2) Income velocity is a contrived figure (fabricated); it's the transactions velocity (bank debits, demand deposit turnover) that matters; (3) money is the measure of liquidity; & (4) the rates-of-change used by the Fed are specious (always at an annualized rate; which never coincides with an economic lag). Economists have learned their catechisms; .

Friedman became famous using only half the equation, leaving his believers with the labor of Sisyphus.

The lags for monetary flows (MVt) – real GDP and the deflator are exact, always the same --- 10 months and 24 months respectively. Rates of change are always measured with the same length of time as the economic lag (as its influence approaches its maximum impact). Not surprisingly, member commercial bank legal reserves rates of change corroborate the lags for monetary flows (MVt) – they are of identical length. The BEA uses quarterly accounting periods for real GDP and deflator. The accounting periods for GDP should correspond to the economic lag, 10 months, and 24 months, not quarterly. They should represent a rolling moving average.

Monetary policy objectives should not be in terms of any particular rate or rate of growth of any monetary aggregate. Rather, policy should be formulated in terms of desired rates of change in monetary flows (MVt) relative to rates of change in real GDP. Note: rates of change in nominal GDP can serve as a proxy figure for rates of change in all transactions. Rates of change in real GDP have to be used, of course, as a policy standard.

Because of monopoly elements and other structural defects which raise costs and prices unnecessarily and inhibit downward price flexibility in our markets (housing being most notable), it is probably advisable to follow a monetary policy which will permit the rate of change in monetary flows to exceed the rate of change in real GDP by 2-3 percentage points. In other words, some inflation is inevitable given our present market structure and the commitment of the federal government to hold unemployment rates at tolerable levels.

95.8-0.380.012005-10-01 5.35 5.42
97.40.24-0.012005-12-01 5.37
101.50.580.312006-01-01 5.29 5.35
93.5-0.20-0.082006-03-01 5.53
93.8-0.17-0.082006-04-01 5.84
94.5-0.03-0.072006-05-01 5.95
95.2-0.23-0.022006-06-01 5.89
94.8-0.11-0.022006-07-01 5.85
93.8-0.33-0.192006-08-01 5.68
94.7-0.27-0.062006-09-01 5.51
93.0-0.85-0.172006-10-01 5.51
93.6-0.14-0.142006-11-01 5.33
95.70.22-0.162006-12-01 5.32
98.50.470.112007-01-01 5.40

Legal 10 roc 24 roc AAA corporates

I believe this time series will be of some value up until, either or both, 1) deposit classification or 2) reserve ratios change. The 10 ROC (proxy for real GDP) reversed in Dec 2006. The 24 ROC (proxy for inflation) reversed in Jan 2007. Reversed meaning changed from negative rates of change to positive rates of change. However, for trading purposes, real GDP bottomed in Oct (lowest value) & probably inflation as well (if the data was smoothed). Order execution has nothing to do with positive or negative numbers. You trade or measure with statistics, using rates of change, not absolutes.

mikalFrom pushing on a string to hanging by a thread#1520632/12/07; 13:16:42

US T Bond March 2007 - CBOT - February 12, 2007

mikal(No Subject)#1520642/12/07; 13:37:49

Guest Commentary, by Dan Amoss
Who's been sleeping in our beds?
February 12, 2007
Dan Amoss, CFA is managing editor for Strategic Investment
A recently popularized concept dubbed the "Goldilocks economy" sounds nice in theory, but sorely lacks historical precedent. But Wall Street and the financial media have hijacked the children's bedtime story of "Goldilocks and the Three Bears," using it as a metaphor to explain the current economic environment. If we take this metaphor to its logical conclusion, we see that it has big, positive implications for precious metals investors.
Here's how the story goes: Fed Chairman Ben Bernanke, having broken into the three bears’ house, is faced with a choice of three bowls of porridge: one "too hot," one "just right," and one "too cold." His academic background gave him the knowledge to choose this "just right" bowl — a bowl characterized by low inflation and 2–3% economic growth.

Had Bernanke chosen Papa Bear's "too hot" bowl, maintaining an easy monetary policy too long, inflation would now be out of control and the economy would be growing 5–7%. Had he chosen Mama Bear's "too cold" bowl, he would have tightened monetary policy too much, inflation would now be turning negative, and the economy would be heading into recession.

So what is the moral of Wall Street's story, now that we are in the midst of a "just right" economy? We should all invest in index funds and watch our savings yield real returns above 10% per year all the way to retirement.
But it's interesting how the nonmetaphorical version of this bedtime story actually ends. Wikipedia provides a synopsis:

"Goldilocks is still asleep in the baby's bed when the bears return home..."
Mikal -- You didn't expect me to give away the ending did you?
A nice read on the economy and the future(here and now) of gold.

FlatlinerFlow5's Gold Standard#1520652/12/07; 13:51:37

"Regardless of whether or not our objective is …" we are contained therein and look towards gold for historical reassurance.

Your words are English, but your thoughts are that of another language. They come across partly political, but all is forgiven if one speaks truthfully.

The Gold Standard post seems to hit that you believe there is action underway to reduce liquidity that may strengthen the dollar's integrity. No? But, it seems that if you read between the lines one might see that there is not the political will to do so. No? Thus, you're leaning towards "an international financial crisis of unprecedented proportions" (side note, did you mean to leave out the period? It's as if there could have been more following this.)

Today's Monetary Flow5 leaves me a little mixed up. Do you conclude that inflation as bottomed, or that the rate of inflation, that had appeared to be decreasing for months, may have hit bottom and stands ready to accelerate again?

These first posts show real thought. I look forward to learning your point of view.

flow5Goldilocks Landing#1520662/12/07; 13:52:09

We've never had anybody like Bernanke. He's a very smart man. He won't make any errors.
flow5Calculation of Inflation#1520672/12/07; 13:58:14

The low levels of inflation (CPI), etc., currently being reported, have all been statistically exaggerated by the present practice of calculating the rates of change in terms of a base one year earlier, rather than from the base period of the index/market basket (currently 1982-84). The base period when I started driving was 1967 (1967=100). The calculation rationale stems from indexing substantial portions of the federal budget to the CPI, etc. In terms of the 1967 base year prices we are experiencing very substantial absolute increases in current prices. If we go back far enough with the base year some people might conclude we are approaching hyperinflation.
GoldiloxEroding dollar value#1520682/12/07; 14:35:39

@ Flow5,

One look at the government debt chart confirms a text-book hyperbolic curve since 1913, when the FED took "office". I've noted this here, but perhaps before your visits.

The deceiving thing about a hyperbola is the appearance of a slow increase in slope up to the point of crossing unity (1:1). Those who perform their hedonistic magic on it can convince many that the rate is near "linear", but only for a time.

After the point that the geometric increases start showing themselves as integer multiples, those who still don't recognize the long-term hyperbolic flow, will suggest "parabolic anomalies", rather than call the hyperbola a hyperbola. I think they hope to cloud the fact that it is an on-going process (in place from day one by definition) by diverting attention to some fictional "parabolic anomaly".

After all, it's more "politically correct" to try to fix an "anomaly" than admit the system is performing exactly as designed.

The URL is a link to another interpretation of dollar demise.

flow5Gospel#1520692/12/07; 14:46:23

Yes, inflation has bottomed. No, gold won't rise in a straight line. The Fed uses seasonally mal-adjusted data. They also seasonally accommodate commercial bankers at x-mas (which is a policy tantamount to using the fallacious real-bills doctrine)

According to this "real bills doctrine," commercial banks should confine their lending to short-term, self-liquidating paper – paper originating out of the financing of "goods-in-process." The doctrine held that if this procedure were adhered to there could be no inflation of credit since an expansion of credit would be offset by a concomitant expansion in the flow of goods. Furthermore, credit would expand and contract according to the "needs of trade." In the terms of the original Federal Reserve Act, the Reserve banks were adjured to take only "short-term self-liquidating agricultural, industrial or commercial paper which was originally created for the purpose of providing funds for producing, purchasing, carrying or marketing goods....

Of course, with this seasonally adjusted policy, the Fed is now an indian giver, and that's why gold should fall now, and resume climbing, starting approximately, the 2nd week of March.

That's what I trade with. Maybe the Fed can't reduce the world's maelstrom to a few small partial derivaties, but my friend did - Leland James Pritchard, Ph.D., Economics, Chicago 1933.

USAGOLD Daily Market ReportPage Update!#1520702/12/07; 15:28:09">
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 12 (Reuters) -- U.S. gold futures ended lower on Monday, as a firmer dollar and weaker oil prices cut into last week's solid gains, but buying by funds and geopolitical tensions lent some support to the precious metal. Most-active gold for April delivery on the COMEX division of the New York Mercantile Exchange settled down $5.00 at $667.30 after peaking at $673.50 in early electronic trade, near its six-month high of $673.90.

Carlos Perez-Santalla at Hudson River Futures said gold came off early because of weakness in the euro and crude oil. He added that things had stabilized as the G7 meeting did not produce any worrying news for gold.

"But there does seem to be some interest in the gold market, keeping it from going too far to the downside. Fund interest, and buyers have been seen in the market," Perez-Santalla said.

The dollar rose against the euro and neared a four-year peak against the yen. The greenback drew support after G7 finance ministers and central bankers concluded a weekend meeting without singling out the Japanese currency's persistent weakness as a threat to global financial stability.

Oil dropped more than $2 to below $58 a barrel on Monday after leading exporter Saudi Arabia, fellow OPEC member Qatar and OPEC's head of research said the organization may steer away from further supply cuts at its March 15 meeting.

Gold is used by investors as a hedge against oil-led inflation.

Bullion investors are bracing for several key U.S. economic indicators due later this week, including Tuesday's U.S. trade balance data, and Friday's Producer Price Index.

"The dollar's reaction to U.S. economic data is likely to be a feature in the week ahead, while further oil price gains will add inflationary support," wrote James Moore, analyst at TheBullionDesk. Moore added that geopolitical concerns in the Middle East were providing background support to gold, as investors bought the precious metal because of its safe-haven appeal.

The European Union agreed on Monday to implement U.N. sanctions on Iran while holding a door open to fresh talks on defusing a standoff over what Western powers suspect is a covert Iranian bid to make nuclear bombs.

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

flow5New U.S. Currency -- This is its Future#1520712/12/07; 15:39:07

There will come a time ( unpredictable ) when it will be impossible for the government ( federal ) to collect enough in taxes to pay all of its expenses, including interest on the national debt. The Gov't can of course borrow an indefinite amount through the Fed. ( concealed greenbacking ) given a few changes in existing law. But that would lead to hyper inflation - i.e., a collapse in the credit of the Gov't. So the easy way, is the way the French did it in 1960. Simply say that beginning Jan 1 ( or any other date ), new dollars will be issued, and that each new dollar is worth 100 old dollars. Then follow that up with a largely state controlled economy.

In 1960, the French economist / mathmetician Jacques Rueff, during Charles de Gaulle's presidency, converted the old franc, to a nouveau franc, equal to 100 of the old franc. However, even with this substitution, inflation continued to erode the currency's value, though at lower rates of change, in comparison to other countries. And this new franc equaled 20 cents to a U.S. dollar. The old rate was 5.00 to a dollar.

In 1960, the French franc, which was one of the weakest currencies, overnight, became one of the strongest. Correcting policies included plans to 1) balance the budget, 2) stablize the currency, and 3) eliminate currency controls.

The gold content of the franc increased 100%, & 1) foreign exchange rates, and 2) France's internal prices, reflected the conversion overnight. Internally, prices dropped about 90 per cent, and the foreign exchange value rose from about 0.238 cents per franc, to about 20.389 cents per franc.

Domestically, France was on a managed paper standard; externally, on a modified gold bullion standard. With the new policies, France's economy strengthened, and the franc became fully convertible @ approximately its gold par, into gold for foreign exchange and into foreign currencies.

With the introduction of the euro, the franc in Jan. 1, 1999, was worth less than 1/8 of its Jan. 1, 1960 value

SurvivorCurrency Revaluation - Just One Piece of the Puzzle#1520722/12/07; 16:16:49

*IF* there were a US$ revaluation, what would happen to rest of the picture? For the sake of discussion, assume a 100:1 revaluation.

Will the domestic federal debt also be divided by 100, or would it now be payable at $0.10 on the "dollar"?

Would private debt also be payable at $0.10?

If it happened today, would gold be valued at $66/oz?

What would the expectation be for foreign held US bonds now valued in the trillions of dollars?

Does anyone think that $1.00 would buy a widget from China that now sells for $100.00?

I wouldn't expect revaluation to change anything except the thickness of one's wallet unless ONLY currency gets revalued, but not debt.

What I WOULD expect in a revaluation is a mammoth shell-game where so many things change so quickly that no one understands what really happened until long after TPTB has benefited and most everyone else has been hosed.

In any case, the thing that will NOT change is ongoing monetary inflation since that is the master plan.

- Survivor

SurvivorCorrection#1520732/12/07; 16:18:31

I meant to say assume a 10:1 revaluation for the sake of discussion.


Flatliner@flow5's New U.S. Currency#1520742/12/07; 16:32:03

Is this avenue of revaluation possible for the US Dollar in the face of new competition with regards to world reserve status? If I was forced to give up a collection of 10 of yesterday's dollars in order to get 1, today, in order to purchase oil, that yesterday traded for 60 but today trades for 6 – I would convert into Euro's and take another drink for my head would be spinning.

To me, the kicker is that the US Dollar is the principle form of measurement for commodities around the world. It doesn't matter what that commodity is, it just matters that the world deals in commodities in reference to the US Dollar. If the Dollar managers go playing hanky-panky by dropping zeros, they will find that absolutely no one outside the US will trade their commodities for US Dollars. The dollar would die faster than Al Gore could say Global Warming!

Amongst all the possible games that might be played/are being played, gold stands as the roadblock against total destruction. It's too important to outlaw and it's too important to legitimize. Currency gets its support through rule of law, gold gets its support through knowledge.

I have a hard time seeing the French type revaluation in the face of a problem that is generally someone else's.

CometoseYen carry trade#1520762/12/07; 17:23:47

conduit to dollar markets unwound ......un plugged
unraveled ..............

It's soon to become the UN CURRENCY ..........

The songs the writers write have prophetic .....clauses in them

SLIP SLIDIN AWAY comes to mind

CometoseMCHUGH weekend blurb on FSO#1520772/12/07; 17:33:58

established that his studies point to a possible scenario in which the Equities markets turn / these effects would be another unwinding of sorts leading to a reshuffling and conduiting paper into metals .........ahhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhh THAT SUCKING SOUND ...............clearly beautiful and reflecting the beauty of BALANCE CATCHIng FIRE TO BANKERS BRITCHES and the VANITIES they embrace ; UP IN SMOKE UP THE FLU.....POOF and they are gone ........but what of the effects of what they have done .......Sling Shot alluded to this morning ......
RookGreat line flatliner.#1520782/12/07; 17:53:56

Dang Flatliner, this next qoute from you just below is, well, if the Slingshot funded usagold contest was..."Say it all as consise as possible"....this might have been the winner.

"Amongst all the possible games that might be played/are being played, gold stands as the roadblock against total destruction. It's too important to outlaw and it's too important to legitimize. Currency gets its support through rule of law, gold gets its support through knowledge."

Liberty HeadWould they or wouldn't they?#1520792/12/07; 18:33:37

If the rest of the world would simply stop purchasing US Treasuries, and instead dump their surplus dollars into the foreign exchange market, the Bush Regime would be overwhelmed with economic crisis and unable to wage war. The arrogant hubris associated with the "sole superpower" myth would burst like the bubble it is.

The collapse of the dollar would also end the US government's ability to subvert other countries by purchasing their leaders to do America's will.

The demise of the US dollar is only a question of time. It would save the world from war and devastation if the dollar is brought to its demise before the Bush Regime launches its planned attack on Iran.


Me thinkst they would.

Got gold?

Best Wishes

GoldiloxRevaluation of the dollar#1520802/12/07; 18:48:12

@ Survivor,

The last thing TPTB (banks and gubmint) want is a revaluation that allows the consumer to carry more cash.

Way too much data mining (market snooping) and highly profitable obligatory interest charges are wrapped up in "credit" and "debit" accounting. Plastic is "their friend".

I would venture that if the USA were to even consider a zero cancelling scheme that the banksters would be up in arms, and the IRS would then require require even more restrictive reporting of cash transactions.

flow5Financial Services Regulatory Relief Act of 2006.#1520812/12/07; 20:03:13

The act will also allow the Federal Reserve to pay interest on contractual clearing balances and excess reserve balances, two types of balances that depository institutions hold voluntarily at Reserve Banks. By helping to stabilize the demand for voluntary reserve balances, this authority may allow the Federal Reserve to implement monetary policy without the need for required reserve balances. In these circumstances, the Board--as authorized by the act--could consider reducing or even eliminating reserve requirements, thereby reducing a regulatory burden for all depository institutions.

...a number of countries, including Canada, Switzerland Sweden, Australia, & New Zealand conduct monetary policy without reserve requirements. These banks operate on a prudential or liquidity reserve basis. Using the "Taylor Rule", the central banks conduct open market operations to manipulate interest rates – and thus their money supply. THESE COUNTRIES ALL REPORT M3.

RAPslingshot - USA - 152013- contest suggestion?#1520822/12/07; 20:04:39

I have been buying some rare coins, 10 times melt, and would be very interested to know what will happen to the prices of these coins when the spot market explodes.
Historically the prices have exceeded the rate of increase in spot, in some cases by many times, but this has been a gradual increase, not a sudden one, and no other major changes.
Any interest?

TopazCurrencies:Gold.#1520832/12/07; 20:19:20

With a little rejigging of scalings on the Chart, we can pretty well put to bed any suggestion that Gold and Currencies are even on the same planet nowadays.
Stage one of the separation was the 05/06 roll-over with the blow off Mar '06 ...things really got interesting around Aug/Sept '05.
Stage 2 began mid-late Jan '07 and will probably extend well into '08.
The ONLY relevant yardstick referencing Gold right now is Silver Silver like a hawk into Mar/Apr.

Sierra MadreRAP - what happens to the price of rare coins...#1520842/12/07; 21:10:47

RAP, my opinion, for what it's worth, is that buying old coins is a variety of buying antiques. You might be OK with your investment in antiques, but - you might not.

The antiques market is not as liquid and everpresent as the market for bullion coins, selling for close to their intrinsic value.

Right after 9/11 of 2001, there were practically no buyers and those who did buy, got fabulous bargains those days.
Same might happen to you, as a seller - hard to find a buyer.

If we're talking about providing reserves for REALLY tough times, I'd stick with bullion coins. It just seems to me that in a great crisis, as seems to be building, people will not be thinking too much about adding to their rare coin collections.

Just my two bits - it's your decision!


flow5Defense Spending & the War#1520852/12/07; 21:26:20

Large federal deficits cause an increase in the demand for loan funds, and because of the inflationary impact of the deficits, a decrease in the supply of loan funds. This follows from the fact that increases in the deficits will be almost entirely attributable to increases in defense spending. Defense spending adds nothing to civilian productive capacity or to the supply of goods available in the marketplace. And the magnitude of the deficits $116 billion for Iran/Iraq, ($784 billion for DOD), qualify as war economy budgets (31% of net stock of federally financed physical capital (1)). Unless the payments gap is filled by foreigners, the deficits require the controls dictated by a war economy. Bush's solution?...substitute cuts in medicare and medicaid ($550 billion last year) - as a means to prosecute the war.

Joseph Stiglitz of Columbia University (prominent war statistician), using CBO basic assumptions, calculates the Middle East wars will ultimately cost 1.27 trillion.

How much is that in barrels of oil? Answer = 21,166,666,667 billion barrels @ $60.00/barrel

2005 imports/barrels/year = 3,695,971,000 barrels. = 5.72 years supply of imported oil @ $60.00/barrel
(at same consumption rate, i.e., 3,695,971,000 barrels/year)

Give an Iranian a loaded AK 47, and he's thinks he's hit the lottery. His yearly salary is less than cost of his gun. That's what's Jihad is all about, defence against poverty. For Allah or a will?

flow5Testimony of Business Professor Peter Navarro before the U.S.-China Economic and Security Review Commission, February 1, 2007#1520862/12/07; 21:31:02

Author of "the Coming China Wars, Where They Will be Fought, and How They Can be Won"

"China applies a series of measures that, by allowing for refunds, reductions, or exemptions from taxes and other payments owed to the government, appear designed to subsidize exports of manufactured goods or to support the purchase of domestic over imported equipment and certain other manufacturing inputs. These measures appear to be contrary to a number of WTO rules, including the explicit prohibitions against export subsidies and import substitution subsidies set forth in the WTO Agreement on Subsidies and Countervailing Measures." Susan Schwab - UST

physicalmanrap-rare verses bullion#1520872/12/07; 22:28:58

RAP, one way to understand how rare coins could hold up in a more hyperinflationary enviroment would be to go back to 1979/1980 during the inflation -plagued time when i was buying/selling bullion. don't know how it was in the whole country, but in mid-atlantic and lower midwest a lot of your scarcer coins/90% and silver dollars lost all their premiums when taken to dealers or brokers for scrapping or sale.
Dealers had to protect themselves from volitilaty in the day-to-day price back then which fluctuated quite severely at times. plus the technology was much more primitive so you could not instantaneously move a purchase to a smelter refiner with an e-mail. long distance in a motel/hotel back then was .40-to 1.50 a minute. remember buying 20.00 double eagles at 625.00 when gold was near 700.00. had big swings in price and you had to cover your rear if the price dropped the next morning till you got through to your smelter. same was true with silver. bought morgans/peace dollars at 25 when silver was 35 cause you had 1-2 dollar a day moves and it took me 2 weeks to get clear payment after coins were delivered. our host was well established by then and probably had a better turnaround time.
Say you bought some ms-64 liberty gold pieces at 3-4 grand apiece in slabs. If gold goes to 2000 an oz. those coins may not bring more than their melt value as the market may flip to a purely bullion value one. say silver goes from todays 13.66 to 125.0 an will probably see a 1996 silver eagle, which go for 60-80 dollars now not bring anymore than a 1992,1999 etc.
Now, if you have the means to collect rarer coins, then by all means do so. I don't think any other hobby delivers the history and monetary discipline that numismatics do. but if you are of average means you can still collect scarcer coins and not pay a massive premium and still protect yourself from a possible confiscation scenario in the future. buying silver eagles, pre-1933 foreign gold (which are quite scarce) and some 20.00 liberty and st. gaudens graded ms-61,62 or 63. our host is the finest in the business and can serve your needs on any of these as well or better than anyone in the country
just my humble opinion

melda laureAbsolutely Fascinating Oil Speculations: Forward Oil Sales#1520882/12/07; 22:50:10

As in Gold (forward hedges), so too in oil? From Mr. Rob Kirby's market wrapup (the given link is to his archive so it ought to be good after today also).

The authors use CFTC data on futures trader positions to document major changes in the size and term structure of the U.S. crude oil (WTI) futures market. The authors find that as recently as 2000, trading activity in this market was heavily concentrated in nearby contracts. Since then, overall open interest has grown two-fold, with trader activity at the back end of the term structure increasing more than twice as much as the market as a whole.

The market growth in long-term (more than three years) positions generally started in 2004, which coincides with the growth in participation by commodity swap dealers....

I wonder how many of you might now be scratching your heads, wondering why – all of a sudden – in 2004, everybody and their mother decided to start "fiddling around" with crude oil contracts dated > 3 years?...

The "IT" that I'm referring to is something I remember reading a couple of years ago – about J.P. Morgan Chase being chosen by the Coalition Provisional Authority [CPA] to "set up" the NEW Central Bank of Iraq [specifically, the Trade Bank of Iraq]. Take note how this TRADE BANK only became operational in December of 2003:
End Snip:

Some day maybe we'll get an OPEC oil agreement. "We agree to limit sales to X mbpy in the interest of keeping oil reserves as an important reserve asset." Naah, couldn't happen.

For those a bit slow on the uptake, my impression is that he suggests POO is being held down and stabilized via expectations of forward deliveries (in dollars).

melda laureBreathtaking Audacity: Iraqi Oil collateralization#1520892/12/07; 22:57:56

Even greenspan commented on this, (if I recall). I always assumed the market was giving some weight to peak oil ideas, I never considered the possibility of discounting future "guaranteed" sales a la bullion banking swaps.

If so, then a great deal of market strain is now being hidden in a magic stress "potential."

Funny, isn't it; that this "COLLATERALIZATION" just happened to coincide with an "explosion" in trading volume of "LONG DATED" [greater than 3 years maturity] crude oil futures contracts.

968US Congress urges Japan to sell reserves#1520902/13/07; 00:27:31

"The Japanese government should be selling the massive reserves it has accumulated thereby changing the imbalances with the dollar and euro," the letter adds.
TopazRAP Numismatic appreciation.#1520912/13/07; 02:08:31

I'd concur with those posters who see a deterioration in premium going up Sir RAP.
I rely on getting an impression of the current market by keeping a weather eye on ebay.
Admittedly the RARE Coins generally don't trade but the ones identified as commanding a premium of say 1.5 Spot + seldom even attract a bid.
The other consideration is that IF it's faith in currency generally that is propelling PoG (as might be the case now with full tilt global paper opposed to historic Gold standard paper) any percieved multiple spot premium carried through in the past might now just dissolve away completely...given the current full spectrum Fiat state of play.

Hope to have been some help.

TopazThere IS something goin on!#1520922/13/07; 02:28:05

A little too big a coincidence for mine, both Au and Ag running up and stalling at the exact same amounts as yesterday at London open.
We're under full management now I'd say.

Topaz...and AGAIN we're pounding up to 1.30 on the Euro,#1520932/13/07; 02:34:24

..but fear not, I'm not going to waste time and bandwidth tonight tossing my stuff up to an unreceptive audience.
KnallgoldIran on course for nuclear bomb, EU told#1520942/13/07; 04:47:05

The news war is heating up from the Anglosaxions.If for this reason (Iran war) Gold is up,or that the market just doesen't buy the IMF Gold sale is up for guesses.I suspect the latter,the Iranian cause just accompanying noise.
GoldiloxCopyright issues#1520952/13/07; 07:49:28


The future of UrbanSurvival seems to remain bright thanks to a decision when I founded the site not to merely pick and repost whole news stories from other media. Rather, the goal around here is to present a larger context of the days events, from the admittedly quirky perspective of the People's Economist persona, and use available news sources (with links for reference) as a scholarly effort. Whether you agrees with my "scholaring" is neither here, nor there. It's a key point to munch for breakfast because the decision was made early on in order to steer well clear of potential copyright violations.

No, I don't know what happened to Jeff Rense's site, but I was often curious about how they viewed copyright works. "I wonder how they can get away with having people reposting whole articles" I asked myself, time and time again.

Today, we can report that Google has lost a key copyright case in Europe that involves a string of Belgian newspapers that complained about how Google linked to their sites and they have - at least for now - have won, reports Business Week..

If you look at Google's news site,, you'll see that what Google seems to do is grab a headline from a source, take the first paragraph of the headline, and offer a link via the headline (or related stories). Thus, it would appear that what Google is doing, it could be argued, it presenting a short citation with a link to a source. And, absent any commercial (e.g. for profit) content on their news headline page, it could be argued that this is within the "fair use" provisions of the Digital Millennium Copyright Act.

The other side of the argument however, it could be argued that Google is not engaging in any original works, and is merely "piggy backing" on the original works of the Belgian papers. One could argue that minus some what's called in the old world of newspapering, some "enterprise" beyond cutting genius level spidering code, sites that allow large scale cutting and pasting of whole stories as the bulk of their content, could be in trouble. Google will no doubt appeal.


For the reasons cited above, TC has often exhorted us to snip only the portion of an article that relates to our own premise. That looks like it is coming to a head elsewhere in the blog world. It is NOT legal to copy a complete article or the bulk of one, only for the sake of copying. Good reminder from George!

GoldiloxIranian Nukes#1520962/13/07; 08:01:30

Another side of the Iranian Nuke question was brought up by Jim McCanney.

With the resurgence of demand for nuclear power, the western momopoly on supplying it is threatened by processes that exist outside the realm of the big five. The nuclear fuel business is likely to go ballistic (pun not intended) soon.

This could be supported by the fact that Rummy's Swiss consortium sold the North Koreans their reactor, with little concern about placing nuclear fuel in the hands of a known "Rogue state".

So, might the unspoken concern not be access to the technology, but rather, access to the markets, especially for owners of fewer in-ground petroleum reserves?

Is U fuel the next generation oil-gold relationship?

contrarianFaith in Currency#1520972/13/07; 08:01:35

Topaz--not sure if I understand how "faith in currency" can propel the price of gold upward. Shouldn't LOSS of faith in currency do this? Would enjoy clarification.

Re numismatics, some anectodal evidence. I can vaguely remember the 1980/81 timeframe. I knew a 17 year old kid who owned a coin shop and was making $20K a pop on rare coins. This was before grading of course, and it was a very difficult market--you really had to know what you were doing. I remember my amazement at the money he was making. Of course $20K was worth much more back then!

I don't know if EBay is exactly the guidepost for all this. I think it's about the big money deciding to enter the market for numismatics, like they've already entered the market for art--and then prices go to the roof. Of course they will have access to a wall of paper money versus a limited supply of precious coins.

I also think that if one were to go back to the Weimar hyperinflationary period, people were desperate to get their hands on anything physical in the final throes--real estate, art work, factories, etc. There's a book called "When Money Dies: the Nightmare of the Weimar Collapse" by Adam Fergusson, I've been meaning to get my hands on at the library. It's a rare book and out of print. But this is an extreme case and we're not there yet.

GoldiloxAfrica's Weimar#1520982/13/07; 08:14:01


I've mentioned previously about the inflation in Zimbabwe. You'll be shocked with the latest reports that inflation there is running 1,594% on an annual basis, reports an AP dispatch in the International Herald Tribune. .On the other hand, just think what that would be doing to stock prices. Oh? Did I say something? You seem a bit pale....Take comfort my friend that the latest reconstruction of M3 (M3b) by Bart over at looks like its loafing along at an annual rate of only 11.2%, or so.
Well, not to kick sand in your face, although we do own a gold coin which ought to fare well through any inflation, but according to Yahoo's figures, the Dow closed the first day of trading this year at 12,474.52. In order to just keep even with inflation at the M3 (digidollars counted) rate, the Dow ought to be at about 12,600, or it won't even retain its purchasing power. That's admittedly ignoring dividends, but that also ignores commissions and fund costs if you play that game. Now you can explain to your friends why the Fed played "hide the sausage" with M-3 last year.


I still think the DOW vs gold equation speaks VOLUMES!

DOW 2000 = 12K = 48 oz Au
DOW 2007 =12.5K = <19 oz Au

The DOW that has "held up nicely" with the support of massive liquidity, seems to have misplaced about 29 oz of GOLD! No inflation here, Ollie.

By my calculations, for the DOW to have "retained" its purchasing power from Y2K, it should be at 32000!

GoldiloxPPT - paddle packin' team#1520992/13/07; 08:17:44

The 10:00 spankin' has materialized, right after a run on $670 at the open.
GoldendomeAnother day older and deaper in debt.#1521002/13/07; 09:20:57

The U.S. trade deficit widened to a record for a fifth straight year in 2006 as American purchases of Chinese goods and imported oil overwhelmed an increase in exports.

The gap between imports and exports expanded 6.5 percent to $763.6 billion last year, the Commerce Department said today in Washington. The shortfall increased to $61.2 billion in December from a month earlier, more than economists forecast...

Consumer spending now accounts for about 70% of U.S. GDP. Does spending money - particularly borrowed money - give evidence to healthy economic growth?

GoldiloxTrade deficit#1521012/13/07; 09:33:37

@ Goldendome,

Good thing we had a warm autumn and early winter. Just think how wide that gap might have been with greater fuel demand.

flow5History should be a guide.#1521022/13/07; 09:40:16

A brief "run down" will indicate just how costless, indeed how profitable – to the participants, is the creation of new money. If the Fed puts through buy orders in the open market, the Federal Reserve Banks acquire earning assets by creating new inter-bank demand deposits. The U.S. Treasury recaptures about 95% of the net income from these assets. The commercial banks acquire free legal reserves, yet the bankers complain that they are not earning any interest on their balances in the Federal Reserve Banks. On the basis of these newly acquired reserves, the commercial banks can, and do, create a multiple volume of credit and money. And, through this money, they acquire a concomitant volume of additional earnings assets.
How much is this multiple expansion of money, credit, and bank earning assets? Thanks to fractional reserve banking (an essential characteristic of commercial banking) for every dollar of legal reserves pumped into the member banks by the Fed, the banking system can, and does, acquire about 208 dollars in earning assets through credit creation, Initially, all credit creation involving dealing with the non-bank public results in a concomitant expansion of means-of-payment money. Over time, due principally to the trend increase in the public's holdings of currency, and the diversion of saved demand deposits into time and savings deposits, the multiplier for money (m1) declines to about 31. That is for every dollar of open market purchases by the Fed, $31 are added to the means-of-payment money supply (m1). Unfortunately for the rest of us, this money creation does not provide the remotest assurance or possibility that the dollars created will be matched in the marketplace by an offsetting addition to the volume of goods and services offered.
The recent nadir of the U.S. dollar originates from central bank mismanagement. An irresponsible central banking policy permitted the determination of the volume of legal reserves of the member banks to be dictated, by the profit proclivities of commercial bankers (the fallacious real-bills doctrine). During the Christmas season, the central bank should (1) deny additional and excessive reserves to the banking system that restrains the federal funds rate (the bracket-racket), (2) defers ending our protracted inflation, and (3) encourages free wheeling speculation. This would eliminate false signals to all markets and the "trading desk's" need to unwind excess liquidity beginning 2007.
Then, the level of interest rates should be left to the highly interdependent global financial markets. Central bank accommodation should not extend to helping a banker meet their obligations under their lines of credit and other "extra" demands on their clearing balances. Bankers should know they have to hold sufficient liquid assets to meet contingencies, or meet their obligations through their "managed liabilities". As it is, the FOMC accommodates the commercial banker's "seasonal needs", but not financial intermediaries... Beginning November 22, 2006 just prior to Thanksgiving, the central bank added 1.72 billon dollars of "holiday-reserves", knowing that ever since 1942, commercial banks have responded immediately to an injection of reserves. This volume of "holiday-reserves" allowed commercial bankers to expand their loans and investments by $357 billion (using the multiplier) - an oversupply of liquidity, which in turn, was responsible for the dollars wild gyration and downdraft.
"Incredibly wild night of action in FX markets as both Euro and pound verticalized in thin holiday trade to take out multiple option barriers and triggered a torrent of stops. Once the EUR/USD crossed the psychologically important 1.3000 level it invited massive inflows of speculative capital as momentum players, option sellers and wrong footed dollar bulls all scrambled for euros sending the pair higher by 70 points in a matter of seconds
Inflation in this country will never be brought under control until the Fed ceases these policies of accommodation and assumes the full money management responsibilities of a central bank. The pre-xmas expansion of reserves (the multiple expansion of money and credit) and the post-xmas contraction of reserves (the multiple contraction of money and credit) has been destabilizing to world wide markets (exchange rates & commodities). The dollars post-holiday retracement was accomplished without foreign exchange intervention. It was the result of our "Indian Giver". As any Fed watcher should know, ignore the seasonally mal-adjusted data.

For example, the Federal Reserve forced the currency pair EUR/USD downward, beginning 11/22/06;(from 128.16 to 133.67), bottoming on 12/02/06. Then forced the dollar upward beginning 12/02/06 (from 133.67 to 129.00 on 1/12/07). All of this took place without foreign exchange intervention

Gold has an inverse relationship to the dollar: PPP expresses, in relative terms, the purchasing power of currencies within their respective countries. For example: Assume the U.S. dollar/U.K. pound PPP (from our stand point) was equal to $1.50. This indicates that $1.50 could buy commodities in the U.S. having an exchange equivalence to the volume of commodities that could be purchased in the U.K. for one pound. The commodities involved are those included in the weighted price indexes of the respective countries. Obviously comparison of identical commodities with identical weights is not being made.

The equation is: PPP = Base year rate of exchange X Current U.S. index/Current U.K. index X Base year U.K. index/Base year U.S. index. Bilateral calculations yield correct cross rates. The base year rate represents a "normal" or equilibrium rate. The equation adjusts the indexes of the two countries to the same base period, i.e,., 1982 = 100.

Tariffs & currency pegs alter these relationships.

GoldendomeTrade deficit decreases 4th qtr. Gdp.#1521032/13/07; 09:47:48

@Goldilox -Right- The report goes on to say (somebody) expects the figure (might?) improve this year as the $ drops in value (?) ...
The report also points out that we can expect 4th quarter Gdp to be adjusted down .7% from 3.5% to 2.2% - quite an adjustment, I think.

TownCrierGoldilox, msg#: 152095#1521042/13/07; 10:19:51

Thank you very much for that tactful reminder/admonition to all for the preservation of our health and welfare.

And really, the news is merely the frosting on the cake, so we ought not need that terrible much of it (i.e., whole articles) -- after all, it is the thought and action of PEOPLE who make the news and drive the markets, therefore it is the free and candid opinion of PEOPLE that we ought to be most interested in seeing shared (the cake) at this forum.

Case in point, this post was ALL cake (thought) and NO frosting (news). And yet, even in it's admittedly limited scope to address this topic, it probably contained a microscopic kernal of insight that might help someone frame their personal philosophy better than any mainstream article might have done.

Power to the PEOPLE, baby! Choose gold.


GoldiloxThird attack today#1521052/13/07; 10:54:39

Someone wants gold to close below Sinclair's plateau rather badly, but the buyers keep stepping up to bat around $663-4.

The final 30 minutes of COMIX should be "vedy interesting"!

Topaz@contrarian.#1521062/13/07; 11:07:32

Yes, it was LACK of Faith or a decline in LoF I meant Sire.
The whole Numismatic spectrum seems to me to be very subjective and a lot of "faith" is shown the respective gurus in deciding value here.
I personally can relate to a rarity value component for a Gold Coin of (say) 10X Spot when we're on a Gold standard ...but in the here and now, ??
Linked is an article by Adrian Ash relating to the explosion in high-end Art, there's no lack of faith in Fiat in this realm, yet!

Henrigold structurally unstable under high pressure#1521072/13/07; 11:36:55

Looks like monetary pressure is not the only kind of pressure affecting gold. why would someone be investigating the properties of gold at the center of the earth? Hmmm....
Yes its heavy would it sink in the molten core?

Topaz@flow5#1521082/13/07; 11:41:11

There appears to be a lot of anger in the cross-rate market of late Sir to wit, the GBP/EUR action over the weekend and consequent EUR/USD action at 1.30. Can you comment on this as time permits?
Given the obvious stresses a high Euro imparts, do you consider or foresee a breach in the Eurozone Pact, where they revert to national currencies, any time (soon)?

SurvivorThe Daily Whack-A-Mole Game#1521092/13/07; 11:43:56


Think I count 4 whacks today. Guess they win this round with 0.15% gain on a day that saw more than 1% for a while.

But the day's trade is just entertainment. Its the big picture ($262 > $663) that matters.

Just sitting here watching the digits go by. . .

- Survivor

GoldendomeReferring to Sinclair's platform.#1521102/13/07; 12:18:18

He shows the platform at $660, well above the major breakout level of $650. Mr. Sinclair says, "We are going for three closes above the Platform."

It would then appear that Mr. Sinclair's next price objective will be his, $682. price Angel (if you've seen his angels) and then $750 and on up... in fits and starts of course.

We will all see; looks like we're holding above $660 again today.

GoldiloxBig Picture#1521112/13/07; 12:20:56

@ Survivor,

I'm trying to focus on the forward-looking "big picture".

Will Sinclair's 682 "magnet" be the next stop, or will we blow through that to test last May's highs in the 720's, before resting at the magnet?

Not terribly important to my physical stash, but I also gamble with some "paper" gold.

Sierra MadreAren't you so glad...#1521122/13/07; 12:37:24

that we gold bugs are NOT the ones that are "looking into the Abyss"?

The gold-price managers have their hands full and are desperate, probably drops on perspiration on their brows, and all of them, "looking into the Abyss" every day now.

Gold wants UP, that's undeniable, and the Abyss lies there, for once it breaks loose just a little too much, it will be jumping from there and - the Abyss will swallow up the gold managers.

Thank goodness, we are not stuck in that responsibility - an impossible task. All we have to do, is just sit tight. And buy more, if possible, in the meantime. Actually, those hacks are being very kind to us.


mikal@Goldilox, Goldendome#1521132/13/07; 12:44:40

Re: 'Old Resistance', 'old highs', 'support', 'platform',
There are numerous interpretations and plenty of excellent technical analysis available. Adding to the credibility of some of these forecasts are when they corroborate those of others who derived the same outcome independently, using different method(s).
I prefer the 'buy-and-hold approach', in which all possible short term and medium-term outcomes are given equal consideration, if not weighting, and based on fundamentals AND technicals.
Also, the last high in May should be inflation adjusted upwards, for the rapid depreciation of the dollar or
lower exchange rates.

mikalSanitize the new world odor#1521142/13/07; 13:14:04

Imperial sunset? America the all-powerful finds its hands tied by new rivals
By Daniel Dombey
Published: February 13 2007 02:00 | Last updated: February 13 2007 02:00 -Excerpts:
"The world that was born with the end of the cold war is dead and buried. Today, America's sole superpower status, which steeled the Bush administration in its determination to go to war in Iraq, is losing relevance. Instead, the US has an ungovernable new world on its hands."

Mikal-- We are hearing much more of this one world rhetoric. As we hear of the 'new world' and it's 'order' as the only alternative, due to us misbehaving("ugly") americans( or global warming or others), socialism
is sold as tasteful and in vogue and corporate fascism is given a new face.

"This, at least, is the outlook of some of the world's most seasoned officials and international affairs experts, who believe that the US has lost power and influence and that an uncertain era is about to begin. The age they describe is one dominated neither by Washington's matchless military strength nor the old international -institutions."

Mikal-- Here the deliberate deception is extended by again blaming certain "institutions" which, in any case will undergo superficial reform or be merged into other more "benign" bodies without the tarnish.

""We are going through systemic change," Madeleine Albright, the former US secretary of state, says in an interview. "What has happened in the past six years has been a lessening of respect for American power . . . The world is going to be multipolar," she adds, referring to the growing influence of countries such as China and India and the likelihood that they will have greater roles in deciding the world's affairs."

Mikal-- Leave it to the baltic butcher Albright to tell us about "multipolar"! Does that mean justice will be served and she and her ilk will do hard labor at the poles?

mikalVariety used to be called "the spice of life"...#1521152/13/07; 13:28:27

Credit-History Jitters Hit Derivatives
By Aparajita Saha-Bubna and Anusha Shrivastava
Word Count: 896
Mortgage lenders aren't the only ones losing sleep over loans to home buyers with shaky credit histories.
A corner of the derivatives market is caught in a high-stakes game that places two powerful camps on opposing ends of the table.
On one side are mostly hedge funds and banks betting on the deteriorating creditworthiness of subprime mortgages by buying credit protection through derivatives such as the ABX index or individual credit-default swaps based on loan deals.
On the other side are the sellers of protection, mostly managers of collateralized debt obligations, or CDOs, who are counting on these riskier loans ...


mikal(No Subject)#1521162/13/07; 13:36:19

Default would send shockwaves round world
By Joanna Chung in London and Richard Beales in New York
Published: February 13 2007 02:00 | Last updated: February 13 2007 02:00 -Excerpts:
"If Ecuador fails to pay interest on its debt this week the move could resonate far beyond its borders.
Investment bankers, hedge funds and other investors around the world are watching developments closely - for the potential impact on the broader emerging markets and on a new, but fast-growing, sector of the financial world known as credit derivatives."

Mikal-- More fallout from the latest experiment in social
and financial engineering. "The waiting is the hardest part." - Tom Petty

"Some analysts doubt that missing this week's interest payment would have more than a limited effect on broader emerging markets sentiment, because Ecuador's debt counts for only a small portion of the market. But investors are on alert in case a default creates ripples elsewhere, particularly since markets are trading at levels that suggest investors do not expect to see defaults occur."
Mikal-- These warnings are becoming so old that they resemble cliches. But well written.

TownCrierEurosystem Reserves: ESCB let foreign paper fall to new low#1521172/13/07; 14:26:50

During the week endend Feb 9th, the Eurosystem trimmed its net postition in foreign currency by EUR 400 million to a new low of EUR 144.8 billion.

At the same time, under terms of the CBGA, their more significant gold reserves were lightened by EUR 70 million to EUR 176.6 billion.

Over the course of the past seven years, among paper and metal reserves, the Eurosystem demonstration continues to be that of an official preference for gold. Foreign paper holdings had previously been greater than EUR 200 billion, and gold had been under EUR 99 billion.

An example of right-minded policy.


mikalConsumer spending and the holy grail of wealth preservation#1521182/13/07; 15:27:36

Bank credit card aimed at illegal immigrants
Bank of America's card for those with no Social Security number, credit - CNBC- Reuters - 11:49 a.m. ET Feb 13, 2007
NEW YORK - Snippit: "Bank of America Corp. has begun offering credit cards to customers without Social Security numbers, typically illegal immigrants, the Wall Street Journal reported on Tuesday.
In recent years, banks across the country have been offering checking accounts and even mortgages to the nation's fast-growing ranks of undocumented immigrants, most of whom are Hispanic, the paper said, adding these immigrants generally have not been able to get major credit cards."
Mikal-- Expanding the concept of "land of opportunity",
carries with it what some prefer to call 'ramifications".
But within environments of pervasive economic, social & financial neglect, distortions, dislocations or imbalances breed unlimited 'golden opportunities'.

flow5I know him, Sinclair's an idiot#1521192/13/07; 16:09:48

The truth is inviolate and sacrosanct, otherwise known as the gospel.

Monetary flows (MVt) mirror their source: member commercial bank free legal reserves. Their lags and impact are identical. It is mathematically impossible to miss forecasts for real, nominal, or the GDP deflator.

Homeboys, this is worth billions. Subsequent to William McChesney Martin, Jr. (April 2, 1951 – January 31, 1970),
every other chairman was both ignorant and arrogant, i.e.,
Arthur F. Burns (February 1, 1970 – January 31, 1978)
G. William Miller (March 8, 1978 – August 6, 1979)
Paul A. Volcker (August 6, 1979 – August 11, 1987)
Alan Greenspan² (August 11, 1987 – January 31, 2006)
Ben Bernanke (February 1, 2006 – ). Bernanke is the best of the lot, he is intelligent.

Notwithstanding, no one understands money and central banking.

It is beyond the comprehension of the Fed's technical staff, academia, etc., etc. The mammoth misconception in economics is that in almost every instance in which John Maynard Keynes wrote the term bank in the General Theory of Employment, Interest & Money in 1936 it is necessary to substitute the term financial intermediary in order to make the statement correct: the Gurley-Shaw thesis, Reg Q, the DIDMCA of March 31st, 1980, the Garn-St. Germain Depository Institutions Act of 1982, etc.

The dollar is doomed, our government broke. No country has become and remained a world power if it is a world debtor and has a weak currency. From these unwanted events we can expect a vicious level of stagflation that will become an enduring feature of our economic landscape. And the United States will be forced into a high degree of economic isolation and perhaps into an increasingly totalitarian mold. Unless we are willing to make those fundamental reforms requisite to successfully competing in international markets, the continued decline of the dollar will finally force a payments balance on us. Under these circumstances, we can expect long term deterioration in the standard of living of the vast majority of the people in this country. And gold will be the beneficiary.

Goldman SackedJust Cause#1521202/13/07; 16:31:32

Hi Dave,

He is correct…most of the coins trade just above spot (on eBay) with the occasional, perhaps not necessarily rare, but hard to get…trading for a higher premium. Because my main quota (hoard) has been satisfied, I am one of the ones who sometimes bids on higher priced coins. The only real justification for this is basically because I WANT IT!....and I have the money. If I don't get an equivalent value back when I sell it sometime in the future….oh well…it won't break me :)

On the other hand, I suspect what he is referring to are the American coins which generally go for 1.5+spot. I avoid those because I think that these are being pushed as a good investment. Reading about this same thing from the mid to late 1970's this was going on and lots of people were burnt as they began to collect supposedly rare coins in the ensuing collector coin bubble as gold went to 850. These same collector coin prices crashed with gold.

The majority of coins I buy are close to spot, the occassional one that is 'supposedly rare' I buy 'cause I want it. This is the same with banknotes….I think they too are being pushed higher and higher…..but some of them I want so I shell out the cash. I don't necessarily believe that I might get my full money back or make lots of money on them. They are partially for investment, but not a requirement for my future…..again…I just like some of them. I have the cash and sort of disregard any outrageous notes and buy the ones I'd really like to own.

The so called rare coins and banknotes are more like speculation (to me) and bullion at spot will always be number one.

What do you think??? :)

Topaz (2/13/07; 02:08:31MT - msg#: 152091)
RAP Numismatic appreciation.
I'd concur with those posters who see a deterioration in premium going up Sir RAP.
I rely on getting an impression of the current market by keeping a weather eye on ebay.
Admittedly the RARE Coins generally don't trade but the ones identified as commanding a premium of say 1.5 Spot + seldom even attract a bid.
The other consideration is that IF it's faith in currency generally that is propelling PoG (as might be the case now with full tilt global paper opposed to historic Gold standard paper) any percieved multiple spot premium carried through in the past might now just dissolve away completely...given the current full spectrum Fiat state of play.

Hope to have been some help.

GoldendomeI don't know him - Sinclair#1521212/13/07; 16:37:54

So I can't speak to his mental capacity. However, from what sources indicate about him, he's done pretty well over the years, regardless your opinion.

I doubt that anyone here takes his technical talk as gospel, as we've all seen errors in his calls. One thing that Mr. Sinclair has been loyal to, however, is his consistant opinion that gold will move higher over the years and his opinion that we all should be holders. (A view very similar to those expressed here.) --Best.

GoldendomeBuying a little higher @ Goldman Sacked#1521222/13/07; 17:00:09

I've done the same thing with 20 dollar "Saints". If I had a couple of 14-s, I'd spend a little more for a 14-d or a 14 philly (where the mintage was only a tenth of the 14-s). Same applies on some of the other Saints the 13 and 15 come to mind. As you suggest, we do it just because we want it. As a collector of smaller demonination coins by date and mintmark, it can be a somewhat expensive habit to break. And while we know that we can't collect anywhere near a full set of "Saints", it's fun to have some diversity of samples.
flow5revert to national currencies#1521232/13/07; 17:25:05

A weak currency is not a cause; rather it is a symptom of a weak, noncompetitive economy. For a declining dollar, time will eliminate the deficit in our balance-of-trade. But the price exacted will be a sharp decline in imports, principally oil, and the purchase of foreign services, reflecting our relative poverty and inability to compete in the international economy. The fact that we are the world's number one producer of smart bombs will not arrest that trend.

It is economically advantageous for creditor nations, and for the world economy, if creditor nations operate with trade deficits: deficits proportionate to their creditor status. This is, the deficits should be large enough to enable the nationals of debtor nations to acquire a sufficient amount of foreign exchange to enable them to service their international debts.

It is difficult, and important, to know and be able to evaluate all of the significant economic forces operating through supply and demand and if possible their prospective, relative importance.

If the Euro were overvalued, speculators would quickly drive its price down to approximately its purchasing power parity (PPP) level.

"Excess" demand for the Euro has been fueled by foreigners who regard its land, urban and rural, and real estate, office buildings, condos, etc., as under priced at present exchange rates. Common stocks and bonds and various short-term creditor ship obligations are also attractive at present prices and yields. Interest rates have become one of the highest risk-adjusted rates in the world.

Lower nominal rates of interest would make equity investment in the Euro more attractive both here and abroad. While the demand for Euros to finance creditor ship obligations would decrease, the demand for Euros to finance equities would be on the increase. Price/earnings ratios would rise along with the higher earnings and profits derived from a more robust economy, both the consequence of lower interest rates.

Foreigners consider the Euro, a safe haven, and a currency with enough depth, to park exchange reserves, without worrying about foreign exchange losses.

In terms of the relationship of population to natural resources, Japan is a very poor country, poorer than Great Britain and much poorer than the U.S., yet Britain has, for the mass of their people, one of the lowest standards of living, compared to other nations in the European Common Market.

The real culprit for Great Britian seems to be the cost of their products relative to their quality. Inferior quality is not a good buy at any price.

And why would the European states want to pay more money for oil?

flow5Oh, come on. What hasn't moved higher over the years?#1521242/13/07; 17:33:27

I fed-exed Sinclair the analysis showing long term bonds would peak Sept. 81. If you remember I was right. I don't think he was any different than Ed Yardeni buying gold at $800/oz. Gold fell after the first of 80. Who do you think was shorting?
MKEminent persons#1521252/13/07; 19:03:04

Dennis Gartman: "Indeed, in debates on IMF gold sales previously, the Democrats have been the most ardent opponents. With the Democrats in control of the Congress, we can expect that opposition to remain intact. Finally, even if the gold sales were enacted by the 85% majority necessary to do so, we think it is quite reasonable to expect the Chinese to take the entire issue. It is not without reason that Mr. Zhou is on the Crockett Committee, is it?"

MK comment: I will say again that the natural position of nearly all the members of the IMF "eminent persons" panel (Crockett Committee) is, for one reason or another, as buyers. Not just China, but nearly all. And, yes, as I stated here at the time of the IMF press release, China would willingly take it all. (So DG and I are in complete agreement.) There is no need for anyone to make an issue of it. Simply make the call, arrange the exchange and load the plane. The wire would be prepared straightaway and delivered to the account of the IMF instanteously.

R PowellFlow5#1521262/13/07; 19:51:46

"A weak currency is not a cause; rather it is a symptom of a weak, noncompetitive economy. For a declining dollar, time will eliminate the deficit in our balance-of-trade. But the price exacted will be a sharp decline in imports, principally oil, and the purchase of foreign services, reflecting our relative poverty and inability to compete in the international economy. The fact that we are the world's number one producer of smart bombs will not arrest that trend."


May I ask your opinion as to what degree a currency's strength is determined by it's economy? Certainly political stability, varying interest rates of different countries, carry trades, etc are some factors of exchange rates but I do agree that paramount among these is the underlying economy. Could you list what you consider the most important factors that decide a currency's strength, and give some indication of the importance of each...sort of a weighted list of factors?

I know, at least for me, this would not be an easy undertaking but perhaps you already have a clear view on this and would be willing to share it. Thanks for whatever you can offer.


Also, other than a safe haven for wealth storage (and a good one at that) do you view gold as having a direct connection to currencies? Most everything bartered is priced in dollars...corn, cars, cotton, cantalopes + gold...but other than gold's trading value daily determined in a dollar amount (as are many commodities) there still a direct connection between the dollar + gold? Again, I'm a persistent lurker here so reply if you can + whenever is convenient for yourself. Thanks

USAGOLD Daily Market ReportPage Update!#1521272/13/07; 19:54:47">
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 13 (Reuters) -- Most-active gold for April delivery on the COMEX division of the New York Mercantile Exchange settled up $1.20 at $668.50 after peaking at $673.90, a six-month high.

"We are still seeing some pretty good buying interest. Yesterday's break was somewhat short-lived. We saw some renewed buying coming in off the weaker dollar," said Stephen Platt, analyst at Archer Financials.

Platt said that gold prices were helped by the notion that China was planning to diversify its dollar-based foreign exchange reserves. In January, China's premier, Wen Jiabao, told a conference of top policymakers that it would aim to expand the use of its $1.07 trillion in foreign exchange reserves, the world's biggest stockpile.

Platt said he expected the gold market was going to continue to track underlying support, but that it might hit resistance at the $678 an ounce area.

The dollar fell against the euro after solid euro zone growth data boosted chances of a European Central Bank rate hike next month. A separate report showed the U.S. trade deficit [$62.2 billion] widened more than expected in December, raising worries about the growth outlook, further weighing on the greenback.

Citigroup said it expected gold to test the $700-an-ounce level in coming months, citing strong physical and fabrication demand and decreased net central bank sales.

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

R PowellHey, maybe I'm not dumb...#1521282/13/07; 20:23:07

From Flow5's 152119 post...

"Notwithstanding, no one understands money and central banking."

Now then, that does make me feel a whole lot better. I have been trying to figure this one out for years + years. I often putting myself to sleep at night thinking of exactly how different monetary currencies are valued against each other + against resources used worldwide. And, I came to the conclusion that I probably would never understand it well enough, if at all. It's nice to know that my ignorance is shared by the best of us. Sometimes I think the chart readers disdain of fundamentals may be right, except that they don't often beat the coin toss odds either! But the gold price from 252 to the current 660s or so looks right nice on any chart, no?

As to the above quote, thanks, now I don't feel as ignorant. But even if the quote is absolute truth, we certainly don't lack opinions. What a great puzzle... and the POG somehow connected. I'm not sure how, but......

RAPBullion vs rare coins#1521292/13/07; 21:34:48

Thank you all for the varied opinions. This was not a request for advice, just opinions on the tracking. My total rare coin investments so far are less than .5% of my bullion, so it won't break me if it all goes bust.
I have started a registry set and it is the most addictive thing I have ever done!
I have not invested a cent, just traded for bullion, and have already made a profit from it, and it is sure better than watching boring bullion gather dust.

Black BladeAnalysis of the Proposed Clean Energy Act of 2007#1521302/13/07; 21:59:41

Get Prepared For Inevitable Inflationary Pressures Should This Pass

Clean Energy Act of 2007

Having finally reviewed the "Clean Energy Act of 2007" presented by House Democrats introduced on January 12th, all I can say is that these people are complete idiots. It will do nothing to help the US become "Energy Independent? Nor will it do anything positive for the environment. Some of the more insane elements of the bill are as follows:

1. Takes away the ability of the oil and gas producers to use the manufacturing tax deduction that is available to all other industries and is a part of the "American Job Creation Act of 2004".

2. Force leaseholders in the deepwater Outer Continental Shelf block leases issued from 1998 to 1999 into renegotiation of contracts to reset oil and gas price limits on royalty relief. Under the proposed bill companies don't renegotiate the terms of their leases will be forced to pay stiff fines or be excluded from future leases in the Gulf of Mexico.

3. Disallow the expensing of geological and geophysical costs under the life of the producing properties. The bill would shorten the period to a 2-year amortization period for most producers and to 5 years for large integrated companies.

4. Repeal incentives for high cost and high risk deepwater gas production on the Gulf of Mexico Shelf and for oil and gas production in deepwater.

5. Shorten lease periods for the Alaska National Petroleum Reserve and withdraw incentives for exploration and production in the reserve.

6. Impose new taxes to pay for federal renewable and alternative energy sources and conservation measures.

These sociopathic politicians are more interested in punishing the energy industry rather than finding ways to achieve energy independence. It is also perceived as a way to punish oil and gas companies for making a profit (well within the average return on investment compared to the average return in the S&P 500 index).

If the bill passes the House and becomes law, the end result is the write down of many domestic projects and degradation of US energy investments. Domestic energy production will dry up and we will become even more dependent on foreign oil and natural gas. Currently we supply 63% of our own energy needs.

Just as happened in the late 1970's with the passage of the Windfall Profits Tax on energy, the price of oil and petroleum products will rise with the addition of the US demand for foreign oil sources. In the end, the US government actually got less income from wellhead royalties and taxes than they did before the punitive measure. Ultimately consumers are the ones who paid the price.

It is doubtful that the US Senate will stop the House proposal. The Senate has their own simplistic measure introduced on January 4th to "eliminate tax giveaways" and "prevent price gouging". The only "line in the sand" is likely to be a presidential veto. However, now that George W. Bush is a born-again environmentalist we will probably see much higher energy prices in our near future.

Should this energy bill pass, we can actually profit from this by taking profits on energy shares of companies that rely on domestic production. That would put us on track to invest in foreign energy production (domestic and foreign companies), some high yielding Canroys, Amroys, and limited partnerships. While the politicians "fiddle while Rome burns" we can take advantage of the resulting high inflation and profit by investing in precious metals and precious metal mining shares. (Physical precious metals as a most imperative "portfolio insurance" and unhedged shares as a speculative play)

That said, first things first - "get out of debt and stay out of debt, stash enough emergency cash for several months' household expenses, accumulate Gold and Silver "portfolio insurance", and start a storage program of nonperishable food and basic necessities"

We live in "interesting times".

- Black Blade

mikal@RAP#1521312/13/07; 22:00:51

Today's dialogue on rare coins, numismatics and bullion
contained some great points (and counterpoints). Essential reading for those with collecting proclivities IMO.
I have often commented on blogs how I feel economic crisis
is coming and will affect "rarity" perceptions.
But I'm reminded that some markets are, like segments of numismatics, often deep enough to withstand downturns.
Like some homegrown institutions that prosper on patronage and comraderie, loyalty in 'hard times' can make a big difference.
Add in all the new interest in coin collecting in the US, generated by new 'state quarters', new nickels and now new dollar coins including gold commmemoratives.
Lastly, I'm nearly certain registry collecting will be hot, as the investment appeal of rare coins as an alternative to Wall Street takes on an entirely different meaning in this age, notwthstanding the tech/internret bubble burst of 2000, and the appeal of gold Buffalo and Eagle bullion now in four sizes. Proofs and silver dollars as well.
Anyways congratulations on your hobby and good luck!

Rook.,. #1521322/13/07; 22:20:06

R.Powell, I know you were responding to flow5,
methinks the Fed chairmen have played a chess game that is not a stumbling around in ignorance.
I would say that I have 2 views. One, that perhaps planet earth and history would have been better if we had not had the banker boys playing geopolitical games for the last 100 years, and we still had the old mostly small farm based communities.
However, how would that have handled 6 billion people around the globe?
The other view I have, is that self interest, and opportunity, good or bad, brought us to the point where here we are with a shot at planetary globalization on the first try. The Fed did not sleepwalk during these last decades, and geopolitical action, religion, resources, chance, gives us a chance at a global cooperative structure that will have to look different than what we have now, but may very well be a structure that the top central bankers are at present trying to achieve.
I think those who see only -empire, or hedgeonomy-, miss the possiblility, that the globalists, the top ones, the central bankers, and the very top of the political guys, are trying to actually bring something about that for all its drawbacks, is at least realistic and dealing with real issues, in trying to end the history of trouble amongst us humans, to whatever extent we can, by cooperation.
If we time it right, when the Klingons or Jedi show up for tea, we wont look like such a mess.
Or perhaps the lord will show up or send some staff to help bring it that last mile.

mikal(No Subject)#1521332/13/07; 22:22:14 Gold Shocker! "Rising Prices a Bullish Sign" - Adrian Ash - February 13, 2007
Short essay pokes fun at mainstream news accounts of gold activity & uses some good quotes and statistics, such as the POG in different currencies, e.g. the POG in YEN recently touched a 23 yr high! A perspective on money expansion around the world.

mikalSelf-feeding cycle arcs closer#1521342/13/07; 22:50:34

Carry Trades to Unwind as US Slows, Dresdner Says - Bloomberg - 02-14-07
mikalYou can't make this stuff up#1521352/13/07; 23:21:50

Anxiety simmers about financial Krakatoa | Reuters | Feb 13
A European financial 'correspondent' for Reuters has a concise (don't let the 4 pages fool you)and distinctive
take on some major issues economic.
Breakthrough reporting, this time it's Reuters.

Topaztriple-double?#1521362/13/07; 23:39:15

Looms large on the horizon for Au and Ag.
0845hrs GMT and the boys, having been for a bit of a romp, are bought back to their masters in good shape.
We must then have the ritualistic "cup of tea" before letting them loose again.
MVP? ...hard to pick in this arena just now.

GoldiloxHR: Punish oil czars and call it alt energy#1521372/14/07; 00:08:59


I agree with your assessment of the House measure, if not with your analysis of big oil's profit margins.

The measure certainly lacks in any focus on energy "research", and only passes tax loopholes from one lobbyist group to another, as that's about the most that Washington AC/DC can accomplish. "OK, it's time to hand the Halliburton subsidies over to ADM for burnable corn whisky. Some solution.

As to serious ALT Energy, the current lobbies and disinfo campaigns have so demonized any non-mainstream "research" that no one dares support it for fear of being branded "kook".

When I studied Natural Sciences (in the dark ages), we were told that if some of our research didn't lead us down a rat hole or two, we weren't really on the "bleeding edge". What passes for research today is really just product development, using well worn technologies to "stretch a buck", and shunning fundamental research as "too financially risky".

Since CONgress is all about trading tax benefits for campaign contributions, it's unlikely that they care a whit about "research". Worse yet, they are completely clueless as to who is even doing any, since most have been branded as politically incorrect "kooks" already.

This is nothing new. It dates back (in this country) to Edison and Westinghouse demonizing Tesla as soon as he challenged their "sacred cows", which they might not have even implemented without him.

GoldiloxNew Frontier#1521382/14/07; 01:24:08

$670 broken at 12:20PST

Let's see if it holds in Merry Old!

Chris PowellCitigroup analysts tell Barrick: Close hedge book, then stand back#1521392/14/07; 06:44:47

By Dorothy Kosich
Wednesday, February 14, 2007

RENO, Nevada -- Citigroup metals analysts John H. Hill and Graham Wark urged Barrick Gold to aggressively reduce its hedge book or repurchase the entire hedge book, an action that "could be one of the most compelling re-rating catalysts in the metals industry." ...

* * *

For the full story, please use the link above.

R PowellChris#1521402/14/07; 08:05:32

Barrick will need to find some serious selling to unload it's hedge book into, otherwise, Barrick will be cutting its own throat buying into a rising market. Sometimes it is not easy to offset huge positions without jolting the market but maybe they can position elsewhere (other than Comex or other then gold) to hedge....? Interesting problem, no?
Maybe physical delivery into contracts is their best option, depending upon their financial situation. Maybe the $$ they borrowed through hedging has increased production enough to compensate for delivery (of a percentage of their now greater production) into lower hedged prices. I don't know, of course.
Maybe a hedge (say long silver) and then standing orders to buy gold just below the market or..? There are ways but I don't believe they will just offset in mass.

R PowellRook#1521412/14/07; 08:20:06

From your post...

"The other view I have, is that self interest, and opportunity, good or bad, brought us to the point where here we are with a shot at planetary globalization on the first try."

I'll agree. Pragmatic self-interest is a strong force....putting to good use the available capital in "capitalism". I favor this politically + as a means to improve the lot of humanity, worldwide. This is a major tenet supporting the freedom + right to hold gold. Unfortunately, our Republic may be evolving into a centralist hide some of that gold!

Cometosedollar#1521422/14/07; 08:33:48

down 45
R PowellTrading ranges#1521432/14/07; 08:35:06

Do you remember the days of sub $300/ounce gold and $4-6.00 silver? Do you remember the days when a $2.00 gold gain for the day was exciting? And now we have $2.00 ticks in gold and 20-40 cent days with silver! Are we having fun now? There is liquidity yet, and currency to invest. But I, for one, would not invest wealth in currency for savings.
mikal"A real work of fiction"#1521442/14/07; 08:39:25 Not-So-Little Lies in Inflation Data - Doug Kass - - Feb 14, 07
Compares some of the different indexes used by the Fed and regional Fed banks and suggests ways to determine price inflation.

Cometosedollar#1521452/14/07; 08:43:22

down 58
USAGOLD / Centennial Precious Metals, Inc.Gold still cheap from an inflation-adjusted historical perspective#1521462/14/07; 08:55:48">gold price potential
Cometosedollar#1521472/14/07; 09:05:31

Nice swan diver

The markets are ignoring this latest move
and silver and gold are now in pullback mode after climing over 8 bucks this morning.

MOre bloodletting to go.

as the PPT tries to back and fill what seems to be

a resistance bunker buster coming .

Goldilox$670 threshold#1521482/14/07; 09:32:28

Spot hit $670 last night and 671 this morning, and each time bounced like a bird off a plate glass window, but each retreat reforms at higher lows.

Sir Gandalf, release the hounds! Roo meat for all.

Topazalt Gold.#1521492/14/07; 09:47:13

The days when PoG was a reliable proxy for the Basket of currencies on the opposite side of the DX equation are but a fond and quickly fading memory of those who attempt to control such things however ...
...just recently, you'd be forgiven for thinking we'd returned to the bad 'ol days of UP in Dollars, squat in alts.

Rest assured, WE Haven't!

(just tried to link to the Galmarley site's having a lie down, but those who watch such things will know where to look)

Rook.,.#1521502/14/07; 09:50:51

Of course, if the Fed has been sleepwalking, and just winging it trying to lengthen the dollar US advantage, and globalization is just a ruse, then fibbing by Bernanke exampled just below, has no hidden merit, and is just lying.

Ben Bernanke, the chairman of the Federal Reserve, saying, "there is little evidence that the weakness in housing markets is spilling over more broadly to consumer spending or aggregate employment"
"private households have drastically curbed their mortgage borrowing. It amounted to $672.7 billion in the third quarter 2006, sharply down from $1,223.6 billion in the same quarter of last year. Mortgage equity withdrawal peaked at an annual rate of about $730 billion, or 8.1% of GDP, in the third quarter 2005. One year later, in the third quarter 2006, it was sharply down to $214 billion."
So roughly $500 billion has been taken out of the growth in spending from borrowing? How can this NOT spill over "more broadly to consumer spending or aggregate employment"?

Mogumbo"So while Bernanke may be thus left in the dark, we are not, as we are right there as Dr. Richebächer says, "Considering the dramatic reversal in the housing bubble, a virtual collapse of consumer borrowing is definitely in the cards for the United States."

"More frightening, he reports, "In a study conducted by Credit Suisse First Boston, the Chinese consumer will likely have displaced the U.S. consumer as the engine of growth in the global economy by 2014." In only seven years! Less than two Presidential terms!

And that means (counting on my fingers) that in only six years, they will "almost" replace the United States. And that means that in five years, China will be "nearing the time" to replace the United States. And that means that in four years China will be "well on the way" to replacing the United States. And all of that means that, starting right now, and for every year from now until the rest of your life, the Chinese will be gobbling up more and more commodities.

And if there is one thing that can make it possible to have this much growth without the usual attendant inflation in prices, it is to export the inflation. How pleasant to send inflation to, for instance, the United States, by letting the dollar and the idiotic American economy collapse, taking with it all the other idiotic economies so similarly arranged.

Thus China would emerge as the economic colossus of the world, and will be able to buy anything they want, as much as they want, any time they want, paying bargain-sale prices as the yuan becomes stronger, and continues to get stronger and stronger, and thus all of the imported inputs to Chinese industry will be (thanks to the strong and strengthening yuan) relatively cheap, and always getting cheaper! And that's how you can export some serious inflation, dude! Hell, we have been doing it for decades ourselves!

The flip side of the coin is that somebody has to import that inflation, and that will now be us. But don't get me started about price inflation, or about how we are all freaking doomed, because you know how I am about that stuff. Ugh."
If globalization is a ruse, or if the chinese decide to play it as a ruse, then this next data supports the actions of our belief in gold insurance.
"The DJIA in terms of gold has seen the index fall by 64%, and when the DJIA is calculated in terms of the CRB, it is off 50%"

Rook.,.#1521512/14/07; 09:53:51

That / was almost all quotes from mogumbo guru
Topaz...and speaking of proxies.#1521522/14/07; 10:04:56

PoG would seem to be more a proxy for the combined Dollar/Bond composite at present, which explains it's lacklustre performance visavee the wilting Buck. (Bonds are big time green today)
This evolved, it would appear, as a natural follow-on from the growing influence of Futures pricing on the current/Spot landscape.
In fact, with Futures/Derivatives playing such a large role in "current" pricing right across the spectrum (Commodities etc) when a situation arises that commands a "current" price adjustment, all hells gonna break loose.

968The US as leading currency manipulator#1521532/14/07; 10:18:01

In the wake of Tuesday's announcement of yet another record-smashing US trade deficit, the usual chorus of moans about China's currency is in full voice. China must stop "manipulating" the yuan to keep it undervalued, we hear. Yet, argues Henry C K Liu, no government leaves the exchange rate of its currency to market forces. This is particularly true of the US, which sings free-trade lyrics to protectionist music. The trade distortions have been created by US policies, and the China critics are in effect telling Beijing to pay for American errors.
See URL for full text.

968Beijing's shift to equities can move markets#1521542/14/07; 10:24:35

"Turning to the pricing of risk in the markets, the big event of last week was not the G7, but a well-sourced story in China's Southern Weekend newspaper, reporting that the Finance Ministry had approved the creation of a new institution, the State Foreign Exchange Investment Corporation, to manage China's $1.1 trillion of foreign exchange reserves.

These reserves, growing by nearly $200 billion a year, have so far been managed by a department of China's central bank, the State Administration for Foreign Exchange, and invested almost entirely in government bonds and other low-yielding but supposedly risk-free assets.

The new State Foreign Exchange Investment Corporation will have a very different mandate, including a diversity of assets such as overseas shares, and perhaps even property and direct investments in the West. Reportedly, an initial $210 billion in equity investments has already been approved. If the reports are correct, this could represent a sea change in global markets, and especially in the relative valuations of bonds and equities. …..

… China's decision to shift part of its reserves from bonds to equities could prove far more important to markets than anything on the G7's agenda."

See URL for full text.

TownCrierAnother sign on the road#1521552/14/07; 11:06:43

HEADLINE: Finance Ministry OKs a VAT Cut

(Feb 14) -- Russia's Finance Minister Alexey Kudrin said Tuesday VAT may be cut from 18 to 15 percent in return for an increase in the mining tax. The ministry will thus respond to President Putin's request...

Finance Minister Alexey Kudrin said the ministry would be willing to cut VAT to 15 percent in 2009 or as early as this year. Prime Minister Mikhail Fradkov insisted on a further reduction of VAT down to 13 percent.
The VAT reduction to 15 percent will cut 357 billion rubles ($13 billion) from the Russian budget, under early estimates. To replenish the coffers the Finance Ministry proposed to increase the mining tax. As the state annually collects 1.1 trillion rubles in the tax, its rate is likely to be increased by 30 percent with additional 400 billion rubles coming to the budget.

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

First, thanks again to my friend G. for providing the link.

What this article demonstrates is merely a small yet typical step down the trail that a few of us for a couple yearns now have been commenting about here at the forum regarding a political eventuality toward an altered economic paradigm that will emerge as distinctly favorable for physical gold ownership. Additionally, and equally importantly, as you should be able to see here, there is predictably little joy to be had for investors who might try to gain leverage into this eventuality by positioning themselves in paper proximities such as shares of taxable mining operations or else defaultable papergold contracts.

If nothing else, please build your awareness that mining shares are quite likely NOT the place to be when the natural resource in question elevates in status to that of an asset having strategic national importance. Be it through outright nationalization as currently witnessed in our Latin neighbors or through (more P.C.) taxation, the public at large (i.e., via congress or parliament or dictator) will not stand aside letting bonny windfall profits continue to acrue to a private enterprise harvesting the national treasure.

Reality bites? Whether or not this bites you depends where on the dinner-plate you choose to stand.


flow5China trade practices#1521562/14/07; 11:45:52

Author of "the Coming China Wars, Where They Will be Fought, and How They Can be Won"

China applies a series of measures that, by allowing for refunds, reductions, or exemptions from taxes and other payments owed to the government, appear designed to subsidize exports of manufactured goods or to support the purchase of domestic over imported equipment and certain other manufacturing inputs. These measures appear to be contrary to a number of WTO rules, including the explicit prohibitions against export subsidies and import substitution subsidies set forth in the WTO Agreement on Subsidies and Countervailing Measures. Susan Schwab - UST

Susan Schwab United States Trade Representative

The NAM believes that the yuan is undervalued by as much as 40 percent (as of 7/05).

Until July 2005, China's currency had been fixed at an exchange rate of 8.27 yuan per dollar since 1994. As of Jan 2007, the currency rose 6.2% since the currency peg ended July 2005 (to 7.7949 per dollar). Real GDP has grown an average of 9.6 percent in the past five years. With an export driven economy, China's foreign-exchange reserves have risen to $1 trillion. Shanghai and Shenzhen stock exchanges were up over 300% in 2006 to 35x earnings and a $1.01 trillion valuation. --- piracy/protectionism

mikal(No Subject)#1521572/14/07; 12:55:33

China's Besieged Factories
Activists Seek to Expose Unscrupulous Labor Practices to Shame Companies | Craig Simons - Atlanta Journal-Constitution - February 14, 2007

MKUSAGOLD NewsGroup invitation to one and all. . . . We are seeking members . . . Happy surprise later today??#1521592/14/07; 13:15:19

What is motivating the gold market?

Why is the on-going yen devaluation so important to gold? (Two reasons)

For U.S.-based gold owners: Is something going on in the gold market while we sleep?

Citigroup says $700, then $850. . . .We'll let them tell the story.

* * * * * * * * * * *

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<;-) Notice !!!
Get perpared for a CONTEST in the near future !
(see that Sir Slingshot ?)

USAGOLD Daily Market ReportPage Update!#1521612/14/07; 17:26:01">
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 14 (DowJones) -- Gold futures rose Wednesday, helped by a softer U.S. dollar that was in part due to congressional testimony from Federal Reserve Chairman Ben Bernanke, analysts said. The COMEX April contract rose $3.50 to $672, hitting its strongest level since early August ($676.60) before backing down.

Much of the impetus for the metals' gains came from a softer U.S. dollar, said John Person, president of National Futures Advisory Service. Remarks from Bernanke, before the Senate Banking Committee, left the financial markets thinking U.S. interest rates are likely to remain on hold for the foreseeable future, said Person.

The Fed chairman said current monetary policy "is likely to foster sustainable economic growth and a gradual ebbing of core inflation." Still, he said, inflation remains the Fed's "predominant" concern and policy-makers are "prepared to take action" if necessary.

Person listed the next major resistance area for April gold around $680, followed by $700 and $720.

Commercials are actually short the market," said Person. "But there is a lot of fund buying. It's very consistent, not giving up anything on breaks." Buyers do not appear to be constantly going "in and out," he said. "They're staying in and adding on."

He later added, "I think people are coming into the gold market because they don't trust the equity markets and they keep seeing the (gold) market steadily making gains."

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

TownCrierNew contribution from Prof von Braun -- "Divorced from Reality"#1521622/14/07; 17:39:25

In this Valentine's Day lecture von Braun writes:

Since Aug. 15, 1971, the world's monetary system has been divorced from reality, ever since President Nixon closed the gold window. The reality I'm referring to is the one that allows one to settle one's account.
The comedy routine is now in full swing as the comedians try to out-do each other, while confusing the general public with flashing lights, sound bites, color coded stage sets and figures and, oh yes, lots of fancy numbers flowing across people's screens. The one thing missing is of course settlement.
At what point does the rest of the world wake up to the fact that the mountain of debt created by the US banking system cannot be paid? What this implies is that all of these so called transactions are not transactions at all, since, for there to be a transaction, there needs to be an acceptable method of settlement.

The "official" means of settling these transactions was divorced from the transactions themselves when the gold window was closed.
Since Aug. of 1971 gold quoted in US dollar terms has increased from $35 per ounce to its current level of $660, which suggests that 'unofficially' it is still the favored principal unit of account and is likely to continue to remain as such.

^___(see commentary at url)___^

TownCrierChina changes rules of resource game#1521632/14/07; 18:29:12

(excerpts) 13 February 2007 -- ...the rules of the game China is playing in its unprecedented drive to industrialise a 1.3-billion strong population ... requires it to establish massive and sustainable supply lines to secure resources that fuel its vast factory-floor economic model.

...this is the major pillar behind African-Chinese trade. ...much has been said about China's new "colonial" role in Africa...

There are a couple of interesting factors that make up China's drive to secure mineral resources and energy assets. The first is the sheer scale of the undertaking.

The other is the role of the state in securing these resources... the Chinese government plays a prominent role in meeting these strategic requirements, while most other governments rely largely on the invisible hand to meet a rising supply and demand needs.

******A sign of things to come is the Belinga Project in Gabon. Purported to be the largest untapped iron-ore reserves in the world, a Chinese consortium came head to head in the contract bidding with Brazil's CVRD -- the world's largest iron-ore producer.

Because Gabon's iron-ore reserves are situated deep in equatorial forests, massive infrastructural costs have excluded previous iron-ore suitors. Enter the Chinese consortium, which offered to a) build a new railway line 560km into the jungle, b) construct a deep-water harbour from which to export the iron ore, c) develop a hydro-electric dam to supply electricity to the project, d) finance the initiative, e) bring in Chinese labourers to build it and f) offer to buy the entire mined output.

Not surprisingly, CVRD got blown out of the water in the bidding process...

...Bear in mind that China has more than a trillion dollars in foreign reserves... One of the reasons it is reluctant to completely open its currency to market forces is the inevitable appreciation of the Chinese yuan against major currencies such as the United States dollar. Even a "small" 10% depreciation will wipe off $100-billion from Chinese reserves -- enough to finance the estimated project costs of Gabon's Belinga Project 169 times over.

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

Stats like this can give you an idea of the magnitude involved in our discussions of reserves versus wealth. Gold metal is a tangible wealth that not merely 'represents' payment in full, it IS payment in full. Bond holdings, on the other hand, merely represent the tally of transactions that have yet to be settled. And from the paragraph above, you can definitely see the scope of the outstanding issue.

The bottom line is that it is the tangible wealth that truly matters, and these figures demonstrate that there is massive upside potential for gold to move (revalue) in order to mitigate the outstanding (im)balances represented by the bond holdings among international reserves.


GoldiloxChrysler layoffs#1521642/14/07; 18:53:51


The word on the street is 13,000 is far less than the real number.

Chrysler to Cut 13,000 Jobs in Overhaul
Published: February 15, 2007

AUBURN HILLS, Mich., Feb. 14 — DaimlerChrysler said today that it was leaving all options open for the future of its struggling Chrysler Group, which announced a plan to close all or part of four plants and eliminate 13,000 jobs in North America.

The announcements came as DaimlerChrysler said it earned nearly $7.3 billion last year, despite a loss of nearly $1.5 billion for Chrysler. The Chrysler loss compared with a profit of just more than $2 billion in 2005.

"It was a strong year at three of our divisions, but it's been a difficult and disappointing one here at the Chrysler Group," Dieter Zetsche, the chief executive of the German parent, said this morning.

The restructuring plan marked a dramatic swing for a company that had seemed to avoid the same declines as its Detroit rivals.


dem bones, dem bones . . .

flow5Determinants of the Foreign Exchange Value of the Dollar#1521652/14/07; 21:38:21

Our communist containment deficit was the exclusive reason the U.S. dollar ceased to be freely convertible into gold on March, 1968 (i.e., U.S. unilateral transfers of funds by the Federal Government to foreigners.) The private sector didn't run a deficit until 1976

After the Bretton Woods System collapsed in Feb 1973, the dollar continued to depreciate relative to other major currencies, -- 1970 to July 1980. By 1976 all of the world's currencies were floating. The dollar's current account deficits continued, however dollar weakness, was temporarily interrupted, in July 1980, by large favorable interest rate differentials - until February 1985 (the consequence of Paul Volcker's extremely flawed monetary policy). But our burgeoning trade deficits eventually transformed this country from this world's largest creditor to the world's largest debtor in 1985 – for the first time since 1917.

The trade deficit's principle villain (since 1973) has been our dependence on foreign oil. Moreover "Hubbert's Peak" contends that world oil production, has passed its peak, and 1) that the future course of production will fall along a bell shaped curve, and 2) the U.S. price of imported oil per barrel will rise, and 3) and that the U.S. dollar's decline, along with the price of gold (its exchange weight equivalence - PPP) will rise inversely proportional to higher prices at the pump.

From 1950 to 1967, our military industrial complex and its foreign arm, finally broke the dollar. Nowadays, we have never ending foreign trade deficits due to (1) an insatiable appetite for oil ($474 billion in 2006), and (2) the continued rise in the price of a barrel of oil (its scarcity), and (3) the continuing decline in the exchange value of the U.S. dollar 3) the wars in Afghanistan and Iraq along with our foreign military bases ($116 billion for Afghanistan/Iraq, $784 billion (DOD) ---war economy budgets), and 4) by our trading partners, who are export dependent for full employment, shifting their allocation of foreign-exchange-reserves.

Without compensating for these drains on the dollar, its foreign exchange value will be relentlessly, and inexorably downward, say vis-a’-vis, the St. Louis broad trade weighted index (see TWEXM, Trade Weighted Exchange Index" Major Currencies) This will inevitably, increase the number of depreciating, unwanted, dollars, and magnify our trade deficits (5.815 trillion dollar deficit since 1985) . In the long run, there will be fewer dollars to recycle globally (fewer imports), higher interest rates, and higher prices, unavoidably, a vicious cycle.

International events exacerbate our dilemma. The development and growth of the unregulated prudential reserve foreign-dollar banking system (formally referred to as euro-dollar, yen-dollar, yuan-dollar, petro-dollar, or foreign-dollar denominated claims, etc.), has resulted in a superfluous addition to the world's dollar glut.

What the historical record demonstrates is that all prudential reserve banking systems, and all currency peg efforts, have heretofore "come a cropper". Note: One-third of our countries 2006 deficit, over $232.5 billion, consists of the U.S. bilateral trade deficit with China. China achieved this with the piracy of intellectual property, theft of advanced technology, capital controls, stringent protectionism and currency pegs.

What our Country requires, is no less than an end to the chronic liquidity deficits in our balance of payments, and a halt to the excessive creation of foreign-credit dollars. But this is all too much to ask for, and we can expect more of the same, only worse. It is inevitable that at some point, there will be a flight from the U.S. dollar, and therefore, the foreign-dollar. This will generate hyperinflation in terms of foreign and domestic dollar denominate assets, something that no consortium of central bankers will be able to stop.

1) Until July 2005, China's currency had been fixed at an exchange rate of -- 8.27 yuan per dollar(since 1994). As of Jan 2007, the currency rose 6.2% since the currency peg ended July 2005 (to 7.7565 per dollar). Real GDP has averaged 9.6 percent in the past five years. With an export driven economy, China's foreign-exchange reserves rose to $1 trillion. Shanghai and Shenzhen stock exchanges rose over 300% in 2006 to 35x earnings, and a $1.01 trillion valuation. China posts low government deficits, c. -1.4 percent in 2004. It averages under a 2% inflation. Long term interest rates (5 years) were 6.84% in Aug. 2006.

2) In contradistinction, there was a lot of hoopla over Clinton administration running federal budget surpluses from 1998 to 2001 (4,015 billion dollars). While the U.S. economy was smoking (real GDP over 4% 1997- 2000) the foreign exchange value of the dollar rose 25%. At the same time (1997-2001) the current account deficit accelerated by 1.458 trillion dollars. The CPI rose 10 percent during this period.

=What's to be learned? In the short run, the most important factor determining the foreign exchange value of the dollar seems to be a rapidly growing economy and interest rate differentials (albeit absent floating exchange rates for our trading partners). However, in the long run, a strong U.S. economy and high trade deficits don't correspond with dollar strength. Dollar strength corresponds to competitive production and pricing. A collapse of the dollar? Not as long as we have trading partners that are export dependent for full employment.

FlatlinerStreet Tracks gaining weight#1521662/14/07; 22:11:52

The ants go marching one by one…

09 Feb 2007 461.58
12 Feb 2007 466.20
13 Feb 2007 467.74
14 Feb 2007 467.74

TopazThe early going...#1521672/15/07; 00:27:56

shows Buck and eBond both red and by my reckoning, $PoG should be a good bit higher.
Silver is building nicely into firstly, the 22nd (OpEx) then the delivery roll-over.
C'arn the Dogs!


$$$$$$$$$$$$$$ A "PRICE of GOLD" (POG) GUESSING CONTEST!! $$$$$$$$$$$$

We shall have a price guessing contest on the closing (Settlement price) of gold for the April COMEX Contract (GCJ07) on the last day of this month. Wednesday, February 28, 2007, ---BUT all entries must be posted to the TableRound before Midnight on Saturday, February 24th, AND ALL ENTRIES must answer "THE QUESTION" !!

Based on numerous prognostications from both recognized metals industrial companies executives, financial "experts", taxi drivers, and "idiots" – that the price of gold this year will be somewhere between $500 and $2,000, the QUESTION is:

What do you think the price of gold (POG) will be this year, AND, in thirty words or more, Why????

This POG Contest winner -- the closest price guess to the actual Settlement Price -- will receive a rather rare collectors piece, a Danish 20 Kroner goldpiece, having the likeness of King Christian IX on the obverse, but commonly known as a "Mermaid" for the content of the reverse side of the coin !

The "Mermaid" 20 Kronor goldpiece had a total mintage of only 1.5 million, as compared to the nearly 110 million mintage of its period cousin, the English Queen Victoria sovereigns. It gets its name from the blend of a stoic Lady Liberty, enthroned with what I think is a porpoise or dolphin, swimming at her feet. Christian IX, pictured on the obverse of the coin, was known as the 'father-in-law' of Europe because two of his daughters and one son married into the royal lines of England, Russia and Greece respectively, and his grandson became the King of Norway. This coin is exceedingly popular with the people of Denmark in that the "Mermaid" is the national symbol of the country. These beautiful gold pieces were minted between the years of 1873 and 1900, have a Fineness of 0.900, and Actual Gold Content of 0.2592 troy ounce. This prize coin was minted in the first year of production, 1873 !

There will be also be two runners-up prizes for the next closest prognostications --- each winning an one ounce pure Silver U.S. Eagle.


1) The Winner is the poster with the Price Guess closest to the Settlement price of the COMEX (most active) April 2007 Gold Contract (GCJ07) on the date of Wednesday, February 28, 2007.

2) Price "Guesses" shall be stated in Dollars and tenths !
(Such as $666.6)

3) "Guesses" shall be SHOWN in the SUBJECT BOX location AND enclosed in markers of "Dollar Signs" so as to be OFFICIAL !
(Such as $$$$$ $666.6 $$$$$$$ )

4) ONLY one "Guess" per Knight or Lady is allowed, and once that "Guess" has been "taken" -- no one can duplicate it !! FIRST COME has rights to that "Guess".

5) HOWEVER, All "Guesses" MUST be posted before the clock in Denver strikes MIDNIGHT (24:00) on Saturday, February 24, 2007.

6) AND MOST IMPORTANTLY (as this part MUST accompany the Price prognostication) --- In order for your entry to be valid, entries will need to have a full answer to the QUESTION, in 30 words, OR MORE. <===== NOTE !!!
LET the CONTEST begin !

USAGOLD / Centennial Precious Metals, Inc.CONTESTANTS: Feast your eyes upon The PRIZE ! ! !#1521692/15/07; 02:37:26">gold Mermaid contest prize
Toolie$$$$ $685.0 $$$$#1521702/15/07; 03:10:40

The main driver for the American market will be the acceleration of outsourcing high wage work that will cause the more inquisitive among the newly "liberated" to seek answers. They'll be drawn, bit by bit to understand this iron law; the world will configure all facets of their respective economies to undercut the tradable goods and services produced by the issuer of the world's reserve fiat currency. Currency controls, tariffs and quotas are Band-Aids that will ONLY temporarily slow the bleeding. Globalization is indeed unstoppable, and to the surprise of many that will mean the globalization of central bank reserve assets, with gold becoming the common denominator.

Count your blessings you newly liberated. You are given reason to understand the workings of a dying dollar system while the metal of kings is still affordable.

POG HIGH>>> $860

MKScandinavian coins offered for sale in conjunction with Contest#1521722/15/07; 03:29:43

In connection with the contest we have acquired a small grouping of Scandinavian gold coins -- Denmark and Sweden -- which we are making available to our clientele. These are some of the best performing items in the pre-1933 gold coin arena and very difficult to obtain. We know there is a rather large group among our clientele interested in the Scandinavian coins, and this post is the first notice of their availability.

We ask interested clients to contact their representative with the firm.


George Cooper -- Extension #102
Jonathan Kosares -- Extension #110

And myself -- Extension #101 (My clients can talk with Marie Ballard at #106 if I'm not in.)

************* A CALL TO CONTEST!! Bring your best price guessing skills!!! And tell us all what you think gold is going to do in 2007!!!**************

Gold's off to a good start for 2007 and this is our first contest of the year. It should be a good one. Those of you with an artistic bent will note the beauty of the Denmark 20 kroner "Mermaid" contest prize, but note also the outstanding photographic representation by our sitemaster, Randy Strauss. What a treat for the gold coin connoiseur! And as always, many thanks to our goodly wizard, Gandalf the White, for conducting the contest. Good luck to all.

Toolie~~~ It's like living in the future ~~~#1521732/15/07; 03:32:03

What is the driver of your local economy? How will it be affected by the necessity to live within our means once the dollar is dethroned and THINGS must be created again?

Questions worth pondering. Prepare for the answer.

Lebieque$$$$$ $687.80 $$$$$ #1521742/15/07; 03:55:18

As prognosticating idiot, in manipulative matters such as in an idiosyncratic and politically hopeless incorrect financial commodity, I don't buck the trend until it bucks. The ruler predicts my choice, although inflationary common sense would add another full digit and then some.

MKContestants!#1521762/15/07; 04:20:43

I wanted to emphasize something Gandalf pointed out in our telephone conversation today. . . .

Contestants should note that we are using the April Comex price, not the spot price, for this contest. We do that because April is where most of the action in gold pricing is taking place at the moment. Therefore, you must add the contract mark-up to your guess. At yesterday's close there was a $4.60 differential between Feb and April and that will narrow somewhat between now and the 28th.

Topaz$$$ 724.6 $$$#1521772/15/07; 04:55:38

We're into Stage Two of zee Bull and I'd like to think "sometime" this year we should see $PoG hit a high of 1400, then perhaps retrace back to 1100ish.
slingshotContest#1521782/15/07; 07:58:42

I want to Thank those at USAGOLD for having another contest. To Gandalf the White, thanks for your time and effort, Keeping The Rules of the contest.

To all Contestants.

This may be the last contest with POG and POS marching higher. Maybe the Newbies and Lurkers will join in with their 2 cents and get a lot more back.
Good Luck to All.

mikalHeadlines update#1521792/15/07; 08:43:00

Dollar falls to 6-week lows on capital flows data - AFX Mixed start for stocks - CNN/Money
Treasurys higher after a largely weak data batch - CBS Marketwatch - Feb 15
U.S. January Industrial Output Falls 0.5 Percent, Most in More Than a Year - Bloomberg - Feb 15
Capital flowing out of U.S. - CBS Marketwatch - Feb 15
Jobless claims jump 44,000 to 357,000 - CBS Marketwatch What's up with the slow growth in workers' pay? - USAToday Bernanke Pitches Slower Inflation Without Harm to Employment - Bloomberg - Feb 15
Bernanke Says Nothing New, the Markets Love It - Feb 15
Bernanke Says Fed Unlikely to Alter Rates - Wash. Post
Dark side of the housing boom: Shoddy work - CNN/Money Mortgage Hot Potatoes - WSJ Feb 15
India bans wheat exports on inflation worries - FT
Pension funds switch to derivatives - FT - Feb 15
Convertible arbitrage resurfaces - FT - Feb 15
Foreclosures rip neighborhoods - Rocky Mtn News - Feb 15
Chrysler to cut 13,000 jobs under restructuring plan - IHT Nokia Cutting Jobs - Feb 15
Hershey to cut 1,500 jobs as part of shakeup -
Slower Growth In Earnings Is Already Here - WSJ Feb 15
China May Get More Daring With Its $1.07 Trillion Stash - WSJ Feb 15
Rate rise likely as eurozone growth surges - FT Feb 15
Japan's Economy Grows 4.8%, Fastest in Almost 3 Years - Bloomberg Feb 15
U.K. January Retail Sales Decline the Most Since 2003 - Bloomberg Feb 15
ECB Says `Vigilance´ Required, Signals Rate Increase - Bloomberg Feb 15
Germany Battling Rising Tide of Corporate Corruption - NY Times Feb 15

Gandalf the WhiteTHANKS to SIR MK and all you Goldhearts !#1521802/15/07; 09:43:01

I wish to thank all that make this TableRound such an important beacon of "LIGHT" in this era of challenges.

Thanks to Sir Mikal for the following --

mikal (2/15/07; 08:43:00MT - msg#: 152179)
Headlines update

"Jobless claims jump 44,000 to 357,000 - CBS Marketwatch"

Does not the above item make anyone a bit worried ?
Plan for YOUR future ---- GOLD !!!!


"THERE" is the sound of the Royal Trumpeters again !! <;-)

$$$$$$$$$$$$$$ THE FEBRUARY 2007 "PRICE of GOLD" GUESSING CONTEST!! $$$$$$$$$$$$


Entries as of DAY #1 (2/15/07) at just about 10:01 Denver time !!!

Listed in order of decreasing values !

$$$$ $724.6 $$$$ Topaz (2/15/07; 04:55:38MT - msg#: 152177)

$$$$ $687.8 $$$$ Lebieque (2/15/07; 03:55:18MT - msg#: 152174)

$$$$ $685.0 $$$$ Toolie (2/15/07; 03:10:40MT - msg#: 152170)


Paper AvalancheA Quiet Change at $660+ POG vs. History#1521822/15/07; 12:01:51

There have been only three prior instances in the history of POG that it eclipsed $660 for more than a day. These include:

Mid January 1980: On 1/14/80 POG hits $660. Five trading days later it reaches the current record of $850. Five trading days after that it was back at $624.

Early February 1980: On 1/29/80 POG again passes by $660 to close at $674.25. Nine trading days later is reaches $710.50. Six trading days theafter it was back to $652. It would not see $660 for another sixteen years and a few months.

May 2006: On 5/2/06 POG closes at $661. Eight trading days later it hit the high for the year at $725. Five trading days after that it was back at $651.50.

So what?

It feels different this time. It appears that POG is building a base with $660 as the new floor for the time being. There has not been a big spike since we quietly eclipsed $660 at the end of last week - just consitent closes between $660 and $670. I believe that $660 may be the launch pad for POG in 2007.

I may be wrong, I often am. The above are all closing prices for POG and do not reflect intra-day highs, FWIW.


TownCrierPaper Avalanche#1521832/15/07; 12:15:06

Thanks for the chronicle of $660 gold.


flow5April Comex Gold Price on Feb 28, 2007#1521842/15/07; 12:19:26

$$$$ $658.00 $$$$

The seasonals used by the FOMC, are an contemporary application of the fallacious "real bills" doctrine - commercial bank accommodation. The post-xmas contraction of reserves (the multiple contraction of money and credit and commercial bank loans and investments), has been and will continue to be, (until the 2nd week of March)destabilizing to world wide markets (exchange rates & commodities). The dollars post-holiday retracement was accomplished without changes to the fed funds "bracket racket" or by foreign exchange intervention. It was the reversal of commercial bank seasonal accommodation. This time of year the FOMC or "indian giver" agressively removes liquidity (holiday reserves). In order for the FOMC to get back on track, they conduct open market operations designed to remove legal reserves. This is accomplished by frequent repo settlements/redemptions or open market sales of government securities. This in turn, almost always, puts pressure on Gold, and bolsters the exchange value of the dollar, during this time of the year.

daily low high
02/14* 5.27 5 6 1/2

02/13 5.26 5 3/16 5 3/8

02/12 5.28 5.19 5

02/09 5.25 5 5 7/16

02/08 5.25 5 5 3/8

02/07 5.23 5 1/8 5 13/32

02/06 5.24 5.18 5 3/8

02/05 5.25 5.13 5 3/8

02/02 5.24 5 1/8 5 7/16

02/01 5.29 5 5 1/2

01/31* 5.33 5 3/16 6 3/4

01/30 5.23 5.18 5 3/4

01/29 5.26 5 5 1/2

01/26 5.26 5 5 3/8

01/25 5.31 5.19 6

01/24 5.27 5.19 5 3/4

01/23 5.26 5.13 6

01/22 5.24 5 1/8 5 7/16

01/19 5.25 5 1/8 6 3/4

01/18 5.23 5 5/32 5 3/8

01/17* 5.25 5 7

01/16 5.28 5 5 3/8

01/15 Holiday - No data.

01/12 5.22 4 5 3/8

01/11 5.27 5.19 5 3/8

* Indicates the last day of a maintenance period (the last minute scrambling for reserves on bank squaring day produces higher than normal fed funds rate (7%, 6 3/4%, 6 1/2%). It also is indicative of draining reserves.

The daily effective federal funds rate is a volume-weighted average of rates on trades arranged by major brokers. The effective rate is calculated by the Federal Reserve Bank of New York using data provided by the brokers and is subject to revision.

Paper Avalanche@ Town Crier#1521852/15/07; 13:08:43

No problem Randy. It is also interesting to note that we have now closed five consecutive days between $660 and $670. This has never occured before and lends itself to my theory that a base is being formed at this price range.

In each of the three previous times that gold punched through $660, it then spiked within five to six trading days to $850, $709 and $700 respectively for each of the time periods listed below. Not this time.

Given that this most recent eclipsing of $660 does not appear to be part of a 10-20 day spike in POG as the three prior instances were, I cannot help but think that this time may mark the start of a far bigger movement in POG, a turning point in monetary history.


SundeckPaper Avalanche #152185#1521862/15/07; 13:30:10

Uh..ohhh...Sir PA, that sounded a bit like: "This time it's different!"


...but I think you're right...largely because The Dollar is barely the rustle of it's former papery self...


TownCrierPaper Avalanche, another notable item(?)...#1521872/15/07; 13:45:11

The $660-$670 range also happens to correspond to the spot level at which the popular (Western civ.) 1oz bullion items start to cross the $700 price mark.

At the link (currently showing yesterday's closing prices) we can see that half of those six popular 1oz items have surmounted the $700 bar, while the cheaper half are just under that level.

Interesting as this observation of mine is, I would hasten to add that I would almost completely discount it as having contributed anything to the psychological factor observed in the present "stickiness" or "gravity" of the current spot range -- mostly because we are in a market environment in which Eastern civ. physical demand is more important than Western, and they use different standard weights and currencies. Also, and this is key, our market environment is one in which our financial funhouses set the price of gold with paper instruments -- completely taking the physical item out of the equation.



AdvocatusIs it not obvious?#1521882/15/07; 13:45:53

@ Paper Avalanche

The forces of evil manipulate the gold price. That is why it is gravitating to $666.

flow5looks like a base to me too#1521892/15/07; 14:04:42

but bernanke will probably raise rates 1 more time to cool things off. the FOMC just can't go with the flow as they did at x-mas that's what the "real bills" doctrine is all about.
TownCrierOne more for Paper Avalanche#1521902/15/07; 14:11:43

You said, RE: $660, "...I cannot help but think that this time may mark the start of a far bigger movement in POG, a turning point in monetary history."

Normally I don't engage in interim price predictions, nor, therefore, do I ever get emotionally involved in gold's wayward price spikes or dips. You'll never find me acting giddy as a schoolgirl on spikes, nor will I be a crybaby on dips -- unlike _______ [a long list of names omitted].

However, fresh in the spirit of MK's newly-announced price guessing contest, when I read your quote above, I found myself uncharacteristically inspired to 'go public' with my own price-related view of gold's future.

While I'll differ with you regarding where (and why) the turning point in monetary history was significantly marked and made (I can say it was marked in 1999, but for reasons that I'm not allowed to say), I'm in full agreement regarding a bigger movement at being at hand and acknowledge the supreme significance it shall represent in monetary history.

So, with that said, and to relate this to our $660 talking point, looking out into the mid-distance I shall not be surprised when today's price represents merely one-tenth of the future price -- as recently as 2010. That is to say, at the start of the new decade, my expectations are for gold to be moving through $6,000 to $7,000 per ounce. And I'm not going to be emotional about that, either. It's as right as rain.


GoldiloxGold "Channel"#1521912/15/07; 14:25:07

@ PA,

One might suspect that there is a more concerted effort by the short side traders to ""nip this rise in the bud" more quickly than the previous episodes, as the gold community, while still small, has a bit more financial press attention these days.

Even so, every attempt to knock it down has also brought buyers out of the woodwork just above $660.

If $660-70 is a platform, as you surmise, it cetainly looks like it's building a strong foundation.

If a major launch occurs soon, I would look for pull backs to test this platform.

Just my hypothesis. I might be very wrong!

Paper Avalanche@ Town Crier#1521922/15/07; 14:33:21

I agree whole heartedly with your assessment and I like your philosophy regarding the day-to-day swings in the marketplace so as not to be reactionary or too emotional.

I would like to re-phrase the ending to my last post. I think that it would have been better stated a "siginicant change in the behavior of paper gold" as opposed to a "turning point in moetary history." I agree that the events around and since 1999 (WAG, MTM-Euro, liberalization of physical gold trade in Eastern Asia, continual shedding of the dollar holdings by CB's) constitute the long-term turning point in monetary history which, IMO, is the transition from the Bretton-Woods Accord from the mid 1940's to a new system whereby the wealth of a nation held by its central bank is not the paper currency of another nation, but rather physical gold in possession.


Paper AvalancheAs an aside....#1521932/15/07; 14:40:44

Could we get a spell checker with the posting software on the forum? Without fail I miss one to two words with every post.


Flatliner@TownCrier#1521942/15/07; 14:50:12

"but for reasons that I'm not allowed to say" – In order to enjoy one's life savings, one must protect one's life! We all ride this train together, and hopefully, will build upon our knowledge to build a tolerable future built on a tangible foundation.
SurvivorI Almost Forgot . . . #1521952/15/07; 15:11:16

Did anyone else see Peter Schiff on with Mark Haines this morning? Peter had some insightful things to say, but Haines could not get past his dogmatic Wall Street blather.

Mr. Schiff wanted to make the point that gold's ascent is an indicator of overbought equities and overblown equity indexes. Haines' only apparent reason for having Schiff on was to belittle his point of view.

There was a silver lining: Haines was even less convincing than usual. He absolutey squirmed in his chair while tossing jabs at Schiff. It was well worth the viewing time to realize how really uncomfortable a talking head can become in the face of economic truth that is contrary to their on-air agenda.

Gold: No smoke, no mirrors, just inherent truth. Get you some.


Sierra MadreA idea for your consideration...#1521962/15/07; 15:15:46

The transition, which appears to be just beginning, from a fiat (predominantly dollar) dominated world, where central banks hold fiat paper as their reserves, to a world where central banks hold gold in increasing quantities, is in effect a world where power is no longer unilateral, but is becoming slowly "multipolar".

Gold in Central Bank vaults is a symbol of distribution of power; a de-centralization of power and distribution of power to national entities.

This is the reason that US/UK/International Banking is fighting gold tooth and nail. They are dead set against a distribution of power as it goes against their objective, which is to dominate the world.

GOLD goes with Freedom and Independenceat all levels, private to public.


SurvivorSpell Check#1521972/15/07; 15:15:57


Easily done. Just compose your post in Word (or your editor of choice having spell check) and then copy/paste into the forum message window.

Than yous kan spel joost lycke me :)

- S

Chris PowellFreeport will end Phelps Dodge's hedging of copper#1521982/15/07; 15:27:31

From Reuters
via Yahoo News
Thursday, February 16, 2007

NEW YORK -- Freeport-McMoRan Copper & Gold Inc.will end Phelps Dodge Corp.'s policy of hedging on copper prices when it acquires the rival miner, Freeport's chief executive said on Thursday.

"We have no intentions to hedge copper," Richard Adkerson told Reuters in an interview.

Freeport-McMoRan expects its $25.9 billion acquisition of Phelps Dodge to be completed in March.

Phoenix-based Phelps' financial results have been hurt in recent quarters because the company locked in portions of its 2006 and 2007 copper production at prices below market prices, which have soared six-fold in the last three years.

Asked if the new combined company would continue such "copper collars" to hedge against sharp turns in the metal's price, Adkerson said: "You should not expect the new Freeport to sell copper forward or sell options or take steps to limit the upside of copper."

The company would honor Phelps' existing contracts through the end of 2007, but after that, no prices would be locked in, he said, noting that Freeport did not hedge.

"That has not been our approach, our philosophy, and I don't expect that to change. It's not a requirement of our financing.

"My personal view is that different companies can be in a position where they have a need to use derivatives to support their business," Adkerson said.

"But I believe our investors want us to drive their exposure to the copper. If investors want to hedge that exposure, they can do that on their own."

His comments came as U.S. copper futures closed at their highest level since early January amid speculative buying sparked by Chinese import data that signaled a possible demand recovery in the world's leading metals consumer.

Copper for March delivery ended 8.70 cents firmer at $2.6640 per pound on the New York Mercantile Exchange's COMEX division, its priciest close since Jan. 10.

Sierra MadrePaper Avalanche: your post 152182....#1521992/15/07; 15:33:08

You wrote: "[After Early February 1980 when POG passed $660] would not see $660 for another SIXTEEN years and a few months."

Wait a minute, Paper, it was not sixteen years, it was TWENTY SIX l-o-n-g, l-o-n-g years before it hit $660 again!

Talk about patience! Twenty six years passed...and from a young man of 48 I became an old man of 74! And an unrepentant goldbug all those years.

"Good things come to those who wait" - but, it's been an awfully long wait. I am still waiting, and shall continue to wait.


Paper Avalanche@ Sierra #1522002/15/07; 15:51:27

It's a toss up as to which I am worse at, spelling or math. Even after six years of doing so, I still get excited when posting to this astute forum and often miss things. : )

Thanks for the heads up on the spell check short cut.


mikal@Survivor#1522012/15/07; 16:59:45

Re: msg#152195 - Mark Haines hosts Peter Schiff
Thanks for the anecdote. Mark Haines will now be on record as having 'gone through the motions', his assent(ordeal)
to the legitimacy of gold.

flow5Modified Gold Standard#1522022/15/07; 17:27:50

Since 1970, the "western" world has functioned within a system of essentially free exchanges. Some effort has been made, notably in the European community, to use various administrative devices to stabilize rate fluctuations within the community. These, and other efforts, have had limited success. Exchange rates seem to fluctuate capriciously and by their magnitude have had serious and debilitating effects on trade and commerce. What can be done? The choice obviously is not between the present fluctuating rates and the stable rates of a free gold standard. The latter is simply not attainable. Rather the choice is between: 1) A modified gold bullion standard involving periodic changes in adjustable rates, supplemented by occasional exchange controls necessary to the adjustments to new parities; and 2) the present unstable system, the consequence of the free-wheeling speculation that prevails in the foreign exchange markets.

The Friedman "school" espouses the present unregulated system on the assumption that freely fluctuating rates are less destabilizing than the pegged, but adjustable rates. (Milton has always been loath to grant central bankers much discretion in formulating and executing monetary policy.).

Before 1970, exchange rates were in terms of a "fixed target". Now the dollar is a "moving target". I think there is a middle way. It would involve a slight change of the previous modified gold bullion standards. All monetary gold would be held in bullion form in the vaults of the IMF and central banks. All transfers of gold would be made among these institutions. No gold would be made available to the private sector by participating banks. The private sector would acquire gold for necessary purposes under restrictions similar to those imposed on U.S. nationals after January, 1934.

The international monetary reserves of the "western" world would therefore consist of IMF SDR's and gold bullion held by the IMF and the member central banks. This would be a reserve that could not decrease, but could increase. The IMF would act more in the capacity of a central bank of central banks, and would act on all major matters with the advice and consent of the member central banks.
This system would not produce stable exchange rates, but we could reasonably expect less destabilizing rates.

Paper Avalanche@ Survivor#1522032/15/07; 17:29:32

Thanks for the spell check solution.


USAGOLD Daily Market ReportPage Update!#1522042/15/07; 17:48:27">
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 15 (DowJones) -- Gold finished with little change Thursday in markets that ran into profit-taking after a recent rally but also attracted buying on pullbacks, traders and analysts said.

April gold futures dipped 60 cents to $671.40 on the Comex division of the New York Mercantile Exchange. On Wednesday, gold at both exchanges [+CBOT] hit its highest levels since August.

"They have had a nice uptrend," said Patrick Lafferty, Commodity Trading Advisor with Fox Investments, a division of Man Financial. "The rally is being met with profit-taking." However, he continued, the uptrend remains in tact on the charts.

"There is still a lot of buying any time you pull back to minor support," he continued. "It still looks positive."

A floor trader blamed the metals' inability to keep rising to a decline in crude oil. March crude at one point was as soft as $56.62 a barrel, a loss of $1.38 at the time and its weakest level since Jan. 31.

"Copper made a strong move up and was up a little over 10 cents at one point," the floor trader said. "The gold and silver would have followed, but the oil was down today. That has held us back from really rallying strongly."

Overall, however, the floor trader characterized the technical picture as remaining constructive for gold and silver. In recent weeks, they have been tending to make a low for the week on Mondays and then rise for the rest of the week. "To me, that sounds very bullish," he said.

Initial resistance for April gold is around the $680 area, said Lafferty. "Then there is a big psychological target at $700 that the bulls are eying," he continued. "If pressure on the dollar remains negative, like it has the last few days, then there should be no problem with gold testing that $700 level again.

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

flow5MZM Money Supply#1522052/15/07; 18:02:42

MZM has been growing at a 24% annual rate of change in Q4-2006 (not seasonally mal-adjusted).

The fallacious seasonal adjustments are every bit as inflationary as the application of the fallacious real bills doctrine. You can't back out of an expansion of credit and money without a concomitant rise in prices.

TownCrierHEADLINE: Gold to float to $800#1522062/15/07; 18:04:55

Thursday, February 15, 2007 -- A deluge of paper money will float the price of gold to $800 US this year and spike it even higher down the road, Goldcorp chairman Ian Telfer says.

Gold's investment magnetism is strengthening as governments around the world scramble to print money, Telfer told a Vancouver Board of Trade luncheon yesterday.

"We're awash in liquidity and gold, in our view, is going to start to look more and more to people as a store of value and more and more like a currency," Telfer said.

"And it's the only one they can't print."

...for the first time, production from gold mines has flattened out and is starting to fall, he said.

That decline is under way even as the growing middle class of China and India is stoking demand, he said.

"It has a different role in their lives than it does in ours," Telfer said. "It's a store of value. It's almost a currency.

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

Good for getting the beginners up to speed...


Paper AvalancheThe gold rush is accelerating...#1522072/15/07; 18:05:58


Gold sales hit record $65.3bn
ByChris Flood

Published: February 15 2007 13:30 | Last updated: February 15 2007 21:58

Gold sales jumped 22.4 per cent to a record $65.3bn last year in spite of a 10 per cent fall in demand in tonnage terms, according to the World Gold Council, which released its fourth-quarter report on the market on Thursday.

Rapid growth in the popularity of gold exchange traded funds means that ETFs have become the main driver of investment demand growth.

End Snip

Federal_ReservesJob Claims spike - weather blamed#1522082/15/07; 18:07:17

Huh? Why would bad weather spike job claims? What, it gets cold and the boss gets cranky and cans everybody?

Or, are we finally starting to see the impact of layoffs due in the housing, construction, and auto industries.

GoldiloxSpell Checker#1522092/15/07; 18:34:40


Doesn't your browser offer a spell checker? My typing (it's a stretch to call it that) is so bad, my posts look encrypted without first checking them.


GOLD FINGERCommodities#1522102/15/07; 19:26:10

Oil and other commodities have been bouncing around and I do find it interesting how gold is holding its own and is quite stable. I do know that demand for oil will surge again...when? Hmmm maybe after the next us presidential elections?

"A floor trader blamed the metals' inability to keep rising to a decline in crude oil. March crude at one point was as soft as $56.62 a barrel, a loss of $1.38 at the time and its weakest level since Jan. 31"

The above quote was taken from the from page of this website....

Soft now, but not for long....when is dose increase again one should be prepared with gold in hand.

LupoRandy can't say#1522112/15/07; 20:11:22

My goodness, Randy, what could you know that you would not be ALLOWED to say on this forum? Curriosity is killing me here. Is your information something that came from Another or FOA, Hummmmmmm?
Paper AvalancheSmackdown tomorrow#1522122/15/07; 21:53:54

Something tells me that the $660-$670 POG range of the past five trading days will be heavily assaulted on Friday. I think that someone may try to give POG the "gold finger."

GF postings and smackdowns seem to follow one another rather closely.

While I'm at it, I will further divine that here will be a $5 smackdown before the US open at 8:30 EST followed by another $5-$7 waterfall sell off around 11:00 EST.

I may be wrong. Recent history suggests that the above scenario is the likely outcome.

I would love nothing more than for POG to close at or above $672 tomorrow. If so, IMO, it is a completely new game and the days of temporary 10-20 day spikes through $700 are being replaced with a permanently increasing POG.

We will know in about 15 hours.


Sierra MadreCall me anti-intellectual, but...#1522132/15/07; 22:20:38

The world is in its precarious condition thanks to so many very, very brainy, and oh-so-bright world-improvers who have been able to reach the corridors of power and have imposed their various types of remedies to "improve" the world, upon the suffering masses of people who just had to "put up and shut up".

The only thing left, practically speaking, for the suffering masses to protect themselves from the world-improvers is – gold and silver.

It's really so simple. Paper money is a fraud. The Brightest and Best, trained in the most prestigious universities of the world, write thousands of theses and thousands of books and studies every year, welcoming the pecuniary handouts and advantages offered by the paper-pushing banking systems and the Central Banks of the world, who prostitute the Brightest and the Best so that they will go-along and cover up the enormous fraud.

Nature cannot be defrauded. You either get your 70 grams of protein a day, or you die. You either drink the necessary water, or you die even sooner. You can't eat paper bread. (You can't eat gold, either, but of course, if you have it, you stand at the head of the breadline.)

Flow5, this Forum is a refuge for the otherwise voiceless masses, or that part of the voiceless masses which is still thinking about survival. We are not here to listen to more nostrums from one of the Brightest and Best. We are here because we know that Nature will assert herself sooner or later, and – our survival will be at stake.

Let's keep it simple. Expert world-improvers with numbers, charts, graphs, statistics and everything but common sense have just about turned our world upside down and inside out. The macroeconomists have destroyed sanity in our world. Paper money is unworkable and there is no way to fix it; so come down to our level, and dispense some practical wisdom, please!


FlatlinerSIERRA's "dispense some practical wisdom"#1522142/15/07; 22:49:11

It is not a bother to skip over that which is not understood, but to cut off the avenue of communication before it's hit a point, could prove to be disappointing to all. I would have to agree that this new poster has an intellectual ‘air’ about him/her that stands out amongst the crowd (well, except for TownCrier). It may be that we all have to learn how to communicate with our new poster rather than the new poster learning to communicate with us. But, at the same time, if no one can pick up on the subtleties to help bridge the gap, the wisdom may be lost to us.

Flow5, bear with us. If there is a point and we will find it. If it's just a matter of learning, it just may take a little time and helpful guidance.

Meanwhile, we buy gold. Do you?

GoldiloxSpank Gold it's Friday#1522152/15/07; 23:20:44


I tend to agree with you, with a couple of observations to support the hypothesis.

1) It certainly seems that Fridays have become the most consistent battle day for the short crowd, even though the long weekend offers more opportunities for geopolitical upset than my gastro-intestinals would care to ride on the short side.

2) Pondering the long-term gold chart today, I noticed how closely Jan and Feb resemble last year at the same time, a prelude to an almost uninterrupted 180 point rise.

That being said, I am still encouraged by the pattern of higher highs and higher lows we are currently experiencing, as none of the short attacks has amounted to much more than a $10 pullback since early January.

No doubt we are climbing the "wall of worry" associated with 60 unanswered points in barely five weeks, but they have also not been without resistance.

Tomorrow could be a very important psychological day in the gold pit. The question is not "Will they attack", but more likely, "Will the bulls take profits and capitulate to the shorts, or continue to buy up their wagers"?

$660 seems to have put in a strong foundation so far, and its ability to hold up tomorrow may offer some hints about the "readiness" for a next leg up.

I am not an expert, so these are but "gut reactions", based on what I have been seeing, hearing, and reading lately. The price compression created by a battle between $660 and $670 may very well be setting up a return of the conditions that brought us the April and May frenzy in '06.

GOLD FINGERThe price IS right!#1522162/16/07; 00:16:06

Dear Friends of GOLD,

REF:Paper Avalanche (2/15/07; 21:53:54MT - msg#: 152212)

Is there a difference between Genius and Brilliance?

Who has more smarts the self made or the Ivy League trained? Is there something to be worried about in a typo or a misspelled word to have to go back and apologize for it?

Can anyone just move on and figure things out?

There are many animals in nature who can navigate with their so called "sixth" instinct. The ability to know when to run or hide or move with the wind.

I wonder if us humans can be so instinctive like the animals who live with us on the planet. Do you remember when the tsunami hit? Did you hear how the animals ran for the hills? Even the "rats" knew when to reach for higher grounds.

If I am good at predicting a so called "smack Down" like Sir Paper Avalanche stupendously points out, I would then suggest that when others decide to either "SELL" or take profits, it would then seem clear to me, like that sixth instinct an animal has to run in an take advantage.

POINT: When gold drops, however brief, BUY!

SO dose this make me anti-GOLD Sirs?

Getting rich fast with gold? Hmmmm maybe not....guarantee safety and progressively increasing in value? A sure thing!

Have a GOLDEN weekend~



$$$$$$$$$$$$$$ A "PRICE of GOLD" (POG) GUESSING CONTEST!! $$$$$$$$$$$$

We shall have a price guessing contest on the closing (Settlement price) of gold for the April COMEX Contract (GCJ07) on the last day of this month. Wednesday, February 28, 2007, ---BUT all entries must be posted to the TableRound before Midnight on Saturday, February 24th, AND ALL ENTRIES must answer "THE QUESTION" !!

Based on numerous prognostications from both recognized metals industrial companies executives, financial "experts", taxi drivers, and "politicians" – that the price of gold this year will be somewhere between $500 and $2,000, the QUESTION is:

What do you think the price of gold (POG) will be this year, AND, in thirty words or more, Why????

This POG Contest winner -- the closest price guess to the actual Settlement Price -- will receive a rather rare collectors piece, a Danish 20 Kroner goldpiece, having the likeness of King Christian IX on the obverse, but commonly known as a "Mermaid" for the content of the reverse side of the coin !

The "Mermaid" 20 Kronor goldpiece had a total mintage of only 1.5 million, as compared to the nearly 110 million mintage of its period cousin, the English Queen Victoria sovereigns. It gets its name from the blend of a stoic Lady Liberty, enthroned with what I think is a porpoise or dolphin, swimming at her feet. Christian IX, pictured on the obverse of the coin, was known as the 'father-in-law' of Europe because two of his daughters and one son married into the royal lines of England, Russia and Greece respectively, and his grandson became the King of Norway. This coin is exceedingly popular with the people of Denmark in that the "Mermaid" is the national symbol of the country. These beautiful gold pieces were minted between the years of 1873 and 1900, have a Fineness of 0.900, and Actual Gold Content of 0.2592 troy ounce. This prize coin was minted in the first year of production, 1873 !

There will be also be two runners-up prizes for the next closest prognostications --- each winning an one ounce pure Silver U.S. Eagle.


1) The Winner is the poster with the Price Guess closest to the Settlement price of the COMEX (most active) April 2007 Gold Contract (GCJ07) on the date of Wednesday, February 28, 2007.

2) Price "Guesses" shall be stated in Dollars and tenths !
(Such as $666.6)

3) "Guesses" shall be SHOWN in the SUBJECT BOX location AND enclosed in markers of "Dollar Signs" so as to be OFFICIAL !
(Such as $$$$$ $666.6 $$$$$$$ )

4) ONLY one "Guess" per Knight or Lady is allowed, and once that "Guess" has been "taken" -- no one can duplicate it !! FIRST COME has rights to that "Guess".

5) HOWEVER, All "Guesses" MUST be posted before the clock in Denver strikes MIDNIGHT (24:00) on Saturday, February 24, 2007.

6) AND MOST IMPORTANTLY (as this part MUST accompany the Price prognostication) --- In order for your entry to be valid, entries will need to have a full answer to the QUESTION, in 30 words, OR MORE. <===== NOTE !!!
LET the CONTEST continue !!

USAGOLD / Centennial Precious Metals, Inc.The PRIZE !#1522192/16/07; 00:53:36">gold Mermaid contest prize
GOLD FINGEROh lovely!!#1522202/16/07; 01:02:21

I must have it...either I will win it or I will buy it!!


Since I am Danish it makes "cents"

Sundeck$$$$$$695.0$$$$$$#1522212/16/07; 04:38:24

Gandalf's composite question:

"Based on numerous prognostications from both recognized metals industrial companies executives, financial "experts", taxi drivers, and "politicians" – that the price of gold this year will be somewhere between $500 and $2,000, the QUESTION is:

What do you think the price of gold (POG) will be this year, AND, in thirty words or more, Why????"

c c
c c

c c
c c

Clipperty, clipperty, clipperty, clop, clop, clop...

"Whoa Rocinante! Oh noble beast! What's all this then? A castle offering a gold-guessing game? Real gold prizes too? Just think, oh wonderous steed, with that gold we could have you in a set of new shoes in a flash...and buy a curry-comb for Squire Sancho to groom your hide until it shines like the hair of Dulcinea del Tebosa... And Don Sundeck could restock his alforjas with the best victuals...and the best wine for his bota..."

[Dreams a little longer]

"Ahh...but first there is work to be done in 30 words or more..."

"Mmmmmm....let me see..."

"Well, Spot presently sits..."

"No, No, NO Sancho...NOT on the tuckerbox five miles from Gundagai!"

".... around $670, so that's a good start. But there are ten and a half months to go! Oh me, oh my, so much uncertainty! Where are my derivative pills Sancho? Ahh yes, I feel better now...and the wine is a reassuring counterparty."

"Mmmm...if the upslope on the ten-year chart is maintained, then gold should sit around $740 come the New Year. But suppose bold Rocinante is startled upward by some unforseen event...perhaps a flying Chinese Golden Pig trailing a cloud of dollar bills; or a Biblical Burning Bush sputtering and stuttering 'Dubya down and the Devil take all!'...or some even scarier apparition (although, in truth Dear Sancho, it is hard to imagine such a one). But if such were to happen, the muscles in bold Rocinante's thighs might well propel the golden steed much higher in a momentary leap...perhaps to $800 or more, before he regains his composure and settles again to his normal stride. Ahhh, yes! So $800 is perhaps not too high..."

"But on the other hand, Loyal Sancho, even Rocinante may tire from Don Sundeck's ceasless commands and seek to slumber for a while in a low-lying and windless glade, dreaming of conquests-past while girding his loins still more for the future climb. Ahh yes, so perhaps $640, say, may still be revisited (although methinks it is improbable)."

"So there you have it, Sancho. I feel we have complied with all the demands set out by the castle wizzard...what is his name? Ahhh yes, Gandalf the Inquisitor?, no...Gandalf the White. (Sorry, oh Noble Wizzard.) Let us post our entry in the castle mailbox and repair to yonder wood to await the great sounding of the trumpets that will announce the winner..."

Clipperty, clipperty, clipperty...


flow5for what it's worth#1522222/16/07; 07:45:49

i was a commodity broker when i got out of school during 79 - 83. i've never lost in money in treasury bond nor gold futures. i've not been very good with oil and have been bad with currencies. i know a few things milton friedman doesn't know.
flow5Friedman & the Fed's Keynsian Staff#1522232/16/07; 08:57:39

One's opinion depends on the degree of ignorance or collection of prejudice the advocate is laboring under.

1) Friedman couldn't define/kept changing the definition of the "money" supply -- to target. Money is the measure of liquidity, the "yardstick" by which the liquidity of all other assets is measured.
1) the "monetary base/high powered money" [sic] is not a base for the expansion of the money supply.
2) the "multiplier" is derived from "money" divided by member commercial bank free legal reserves, not the monetary base.
3) aggregate demand is measured by monetary flows (MVt), i.e., income velocity is a contrived figure (WSJ, Sept. 1, 1983)
4) the rates of change used by the Fed are specious (always at an annualized rate having no nexus with economic lags; Friedman pontificates variable lags; economic lags are unvarying)

A. Friedman didn't know the difference between the supply of money and the supply of loan funds.
B. didn't know the difference between means-of-payment money and liquid assets.
C. didn't know the difference between financial intermediaries and money creating institutions.
D. didn't recognize aggregate monetary demand is measured by the monetary flows (MVt) not nominal GDP.
And the technicians at the Fed:
E. don't recognize that interest rates are the price of loan-funds, not the price of money
F. don't recognize that the price of money is represented by the price (CPI) level.
G. don't realize that inflation is the most important factor determining interest rates, operating as it does through both the demand for and the supply of loan-funds.

holding one's wet finger in the air to tell the wind's direction? trading is boring. there is no anxiety. you don't have to check COMEX prices, read the WSJ, or call your broker. But you do have to know the gospel - to keep out of trouble.

my friend used to tell me "go easy, easy". but i don't have any sense of ettiquette. I got kicked out of the 5th grade (in 65, prior to the escalation of the Viet Nam war) for dying my hair green (the principal had told me to cut my hair; I was the first). last year i saw this guy stomping his boot on someone's head - who was on the ground. I thought he was going to kill him. I took a few blows inorder to stop it. then i learned that i was wrong, because the guy on the ground had cut a piece of flesh out of his attacker's head.

When I was a kid, Dr. Dodge told me that everybody, no matter who they were (even the janitor), has something important to say. Listening is an art. And I am the gate keeper.

mikalNews nuggets#1522242/16/07; 09:30:47

Source: MarketWatch / Friday, February 16, 2007
U.S. consumer sentiment declines more than predicted in January

U.S. stocks open lower after mixed data

U.S. consumer sentiment declines more than predicted in January

U.S. housing starts plunge 14.3% to lowest rate in 10 years

PPI falls 0.6% in January, core rate rises 0.2%

Corn-based ethanol's a flawed concept

contrariantrading currencies#1522252/16/07; 09:43:37

flow5--for what it's worth, I've heard that 90% of currency traders (futures I imagine) lose their shirts. I'd be curious to hear if others know this is the case. And yet, there always these ads on TV and on the internet about making huge profits with futures trading systems. For the sophisticated suckers...there's no such thing as a free lunch!
Flatliner@Flow5's 'the gate keeper’#1522262/16/07; 09:45:49

"Listening is an art" as is speaking. Learning can happen during the exchange, but it is not guaranteed. I have observed that there is a subtle substance, or key understanding, that seems to only live between the words and if both people cannot align their thoughts, the idea behind the communication is not conveyed. Another way of looking at it is that it's not always the words that are used, but how they are used that conveys the bulk of the meaning. Unfortunately, if you can't figure out the way in which they are said, the real beauty behind the art is not heard.

In an effort to discover the intent behind your words, I must ask, what gate do you keep and how? When you dyed your hair, did you use an Acqua regia solution? When you contemplate Monetary flows does it enhance your gold understanding or is it the other way around?

In the end, time will play out a solution one way or the other. Hopefully, a subtly golden substance will elevate out of your words in such a way to enhance the lives of those in this great forum.

Flatliner@TownCrier#1522272/16/07; 09:55:02

I'm looking to clarify your "I'm not going to be emotional about that" post from yesterday. In the face of a hyperinflationary situation, a 10x price increase could come within a (½)x purchasing power situation. For some reason, I do not get the feeling that your comments were built on this scenario, thus I ask. When you wrote ‘price’ in your posting did you mean to say ‘purchasing power’? I would have written purchasing power.
Paper AvalancheHoping to be wrong on yet another prediction...#1522282/16/07; 09:58:54

I am more than happy to be wrong (yet again) about my prediction last night. If we close above $660 again in an hour and half we will continue in uncharted waters.


Topazalt Gold.#1522292/16/07; 10:01:55

Without the option of choosing a scale it's a bit difficult to properly ID the situation as it stands but blind Freddy can see the spread increasing as we watch.
Rest assured, Stage Two of the Gold Bull is alive and kicking. Week 2-3 delivery month action in gold completely consistent and ..given a short month, augurs really well going forward.
Next week will see Silver take up the cudgels and should throw a buoyancy vest around PoG ...Ag is a far more "honest" read and will not disappoint ...ALL MONTH!

Most of the AltPog's have fallen back to support here with perhaps the LooniePoG giving back more than it should've. To be expected however as it ($CAN) really looked pathetic these past few weeks.
Yen otoh has taken the bad-mouthing from Essen to heart and punched it's way out of the wet paperGold bag. Tough hombre-san!
GBP suffering the familiar Saturday nite bravado - shame all next week syndrome.
Bottom line, they're all ready to roll over to the upside again next week ...IMHO.

GoldiloxHershey's fattens the Bonepile#1522302/16/07; 10:09:22


The background is that many of my Chinese friends exchange gifts (gifting is very important in Chinese culture) and in my circle, Godiva chocolates were/are favored. So when I read that Hershey, the famous Pennsylvania chocolate maker is laying off 1,500 workers, I begin to wonder if life is losing some of its sweetness. Maybe there's more impact from the corn-for-ethanol than just rising high fructose corn syrup prices than I thought.


OK, already. This bonepile thang is getting serious.

Henriflow5#1522312/16/07; 10:13:22

so when you say that you are the gatekeeper, do you mean that you are the one who determines what types of information/knowledge are admissable to your brain for analyzing against your current framework of reality?
GoldiloxFriday Follies#1522322/16/07; 10:32:52

@ PA,

I don't know that you were wrong in your prediction. It just looks like there are enough buyers at $663 to hold them off. That's probably god news for gold moving forward.

(:^) Goldilox

Henri@Sundeck#1522332/16/07; 10:42:28

I see by your outfit that you may be an Aussie...does your Mabel wait for ye...and a winedot...does the pub have no Beer!?!

Seriously...I loved your "stream of consciousness" post. Way to Go for the GOLD! my entry to follow

FlatlinerStreetTracks#1522342/16/07; 10:44:14

Looks like someone got a golden valentines’ present.
13 Feb 2007 467.74
14 Feb 2007 467.74
15 Feb 2007 475.76

Henri$$$$$$ 662.50 $$$$$$#1522352/16/07; 11:02:33

As encouraged as I am that the battle for physical is driving the price higher lately, the spigots of the global dollar flow are being cranked ever wider lately and such easy flow will be brought to bear against the futures contract for gold in the near term. Unless a real source of the shiny becomes apparent and attainable on the so called market exchanges, the futures price (as opposed to the POG)will continue to diverge until it matches the value of the contracts for delivery. No real gold available for delivery means a falling exchange based price. What I have posted in the subject line is my guess at the comex April Gold futures contract closing price on Feb 28, 2007 and NOT the POG. My guess for the POG in this year? I believe it is already demonstrated to be unavailable in size and therefore priceless. That which is obtainable from govts as bullion coin products will continue as long as possible to reflect the exchange futures delivery price...until it runs out. Then that which is obtainable from private sources will set the price. If that happens this year, the POG will be in the range of $1040/troy content. (It is a guess purely influenced by my current endeavor of reconciling with TPTB at the level of their cut for my activities in the previous year.
CometoseLaunchpad#1522362/16/07; 11:05:38

breakout ...........lookin good
GoldiloxFreudian slop#1522372/16/07; 11:16:35

"good news", not "god news", but it works for me!
Goldilox$$$$ 688.0 $$$$#1522382/16/07; 11:26:32

Given the latest chart formations at $680, I think Gold has the very distinct possiblility of revisiting the last high water mark of $729 in the near future, and possibly even besting it. I base conclusion this on dollar fundamentals, drops in gold production, and geopolitical insanity.

While Gold may not close out the year at the high, I look for at least one and maybe two " gold rush" events similar to last April-May. If we only see one, I suspect it will top out around $730. If two, we could challenge the 1980 high of $850, and maybe even visit Sinclair's $882 "Angel".

CometoseInteresting #1522392/16/07; 11:30:49

to see in a couple of hours what the commercials are up to this week
GoldiloxFriday Follies Flop#1522402/16/07; 11:32:53

@ PA,

Here's a nice twist. $668 and change at COMIX.

It seems traders are a mite timid about being short over the weekend.

Up into the close!!!!!

SurvivorReading Is The Easy Part#1522412/16/07; 11:36:28


Your insight is appreciated. If I don't understand, I'll ask for a clarification of terms or a restatement of premise.

By taking the time to write, you are doing the hard work. Thanks and please continue.

- Survivor (with a full head of long silver hair :)

TownCrierFlatliner (#152227), on my 10x price prognostication vis-a-vis inflation and PP#1522422/16/07; 11:48:21

Thanks for taking the time and interest to scrutinize my #152190 post yesterday for its intended meaning. Judging from your comments I can conclude that you are either a mind-reader or else just very good at squeezing the true meaning and intentions from my less-than-perfect choice of words.

Yes, your suggestion is correct -- "purchasing power" would have been a better presentation than my more simplistic and ineffective use of the word "price".

That is to say, when I said that I foresaw gold priced "right as rain" passing through the range of $6000 to $7000 in the year 2010, that price level did not account for any additional depreciation of the dollar due to inflation. In other words, my comments regarding a 10x price level was representative of the value of TODAY's dollar.

Thus, as you've rightly guessed, my meaning would have been more clearly conveyed had I done a better job stressing that this 10x increase was in regard to PURCHASING POWER, and that any intervening effects of (hyper)inflation and dollar depreciation between now and then would result in a PRICE that was higher, accordingly.

Thanks for giving me the opportunity to revisit this to better clarify my meaning.


CometoseHui #1522432/16/07; 12:12:13

looks like it has a winter dose of the flu
CometoseNarrow trading range #1522442/16/07; 12:17:36

and that of some of the Juniors looks like a hold ing pattern of Bullish to Neutralish

Waiting on something ...

Cash is headed that way: KRYPTONITE coming to a PAPER HANGER .........BERNAKE......

Perhaps waiting on MONDAY ///////////PRESIDENTS DAY ...
to send a message to GERM

mikal@Cometose, Flatliner, contrarian, Goldilox, Henri, Sundeck, Paper Avalanche, Town Crier, melda laure#1522452/16/07; 12:47:19

Good points on the threads begun yesterday into today.
Re: POG topic thread - POG this year could correspond to some of your guesses IMO, though my guess is closer to some of those we will be seeing. :)

Sierra MadreTreasury reported NET CAPITAL OUTFLOW in Dec. 2006#1522462/16/07; 13:00:35

Maybe this news was posted at this Forum yesterday, but if so, I did not see it. To my mind, it is extremely important. The Treasury reports that in December, 2006, there was a NET OUTFLOW of capital of $11 billion. This is very important news, because it means that in December, the US did not receive sufficient funds (coming in to buy bonds, stocks or investments in physical plant) from foreigners, to cover the Trade Deficit.

Last year, some $736 billion was sent to foreigners as a consequence of a deficit in Trade, that is, a lack of compensating exports from the US. Up to now, this has been taken with a sort of "tra-la-la" attitude, because the money sent out, like that $736 billion, just came right back into the US to buy bonds.

The Treasury report means that the foreigners are cutting back seriously on purchasing bonds. Now, if this report is not a fluke, but indicates the beginning of a trend, that means that THE FED is going to have to buy the bonds that are issued to cover the Fiscal (Government spending) Deficit. That is pure monetary inflation. Foreigners are in effect saying that they do not wish to fund the wars in Iraq and Afghanistan.

When foreigners cease covering a US Trade Deficit with their investment – as this report shows is beginning to happen – for any other country it means: imminent devaluation of the currency.

Perhaps it will mean just that, for the US. Comments are welcome, and indeed, much needed.

FOREX-Dollar falls to 6-week lows on capital flows data
NEW YORK, Feb 15 (Reuters) - The dollar fell to a six-week low against a basket of major currencies on Thursday after a report showed a net outflow from U.S. capital markets in December.
The euro rose to six-week high of $1.3158 from around $1.3130 before the data. The dollar fell to 120.00 yen from around 120.10, edging closer to a one-month low at 119.79 hit overnight.
The Treasury Department said the United States saw a net outflow of $11 billion in December, nowhere near enough to cover the country's trade deficit for that month…


mikal(No Subject)#1522472/16/07; 13:10:20

Venezuela Will Introduce New Currency - Iran-Daily
CARACAS, Venezuela, Feb. 16-- Excerpts: "President Hugo Chavez announced Thursday that a new currency will be introduced into Venezuela next year in order to combat inflation, AP said...
The Venezuelan leader also announced a gradual five-percentage point reduction in the value-added tax, currently 14 percent, by July 1 to help combat inflation.
Other countries like Brazil and Argentina have redenominated their currencies in the past to try and rein in hyperinflation, but some economists say such measures have little effect unless it is accompanied by fiscal reforms."
Mikal-- In Venezuela, inflation evokes typical responses
to postpone or alleviate problems that become worse as a result. This is like the Fed's dilemna, who, caught between a rock and a hard piece of kryptonite(thanks Cometose), must
exhibit control(authoritarian/authority) behavior at any cost. You have to wonder what they strut out for Spring mating rituals.

mikal@Sierra Madre#1522482/16/07; 13:22:13

Yes, the TIC report was mentioned yesterday. Yours were the first comments on it. BTW, thanks for yesterdays remarks and data.
Some of us here have maintained that the Fed and Treasury have set up Treasury bond purchasing accounts through proxies in the Carribean and lately, the UK. The data supports this monetization of the debt, 'inflation' or no 'inflation'. Sentiment on the Forex is tilting towards a lower dollar.
Fundamentals and technicals also support more dollar declines to some of the lower supports in the near future and certainly throughout the year IMO.

mikalMore on Venezuelan VAT, currency #1522492/16/07; 13:35:27

Venezuelan President Vows to Fight Inflation With Currency, Tax Changes By VOA News
16 February 2007 | Snippit:
"Venezuelan President Hugo Chavez says he will slash the nation's value added tax.
In a nationally televised broadcast Thursday, Mr. Chavez said the move is designed to bring down the nation's inflation rate, which at 17 percent last year was the highest in Latin America.
Mr. Chavez said he will lower the value added tax by more than half by July, a measure that will cost the government nearly $4 billion (eight trillion bolivars) per year. The president said he will make up the difference with other taxes, possibly on privately-held assets.
Mr. Chavez also said he would slash three zeroes off the nation's currency - so that a 1,000 bolivar note would be a one bolivar coin. The move would be a symbolic one, meant to evoke a stronger economy."

968New Global Trend: Dump a Dollar, Buy a Euro #1522502/16/07; 14:03:14

A trend of enormous significance for every reader: Investors the world over are beginning to pull away from the shaky dollar—and to bank instead on a young, up-and-coming currency. This is a sign of a massive economic earthquake you can expect soon!
See URL for full text.

CometoseCOT#1522512/16/07; 14:13:00

Interestingly , the figures remain on the short side again this week

The commercials

for silver were net short 3000 contracts in options and futures

for copper were net short 1500 contracts and

for gold the commercials were net short another 20,000

Quite frakly these numbers have me scratching my head

and they mean one of two scenarios happening

Gold is being set up for a nasty fall .......
the lofty gains have been allowed illusioning demand strength ......

or there is huge buying which is causing underpinning strength ; the masters of the universe are close to losing their grip on this market again


This later version might be in line with an attempt to allow and orderly fall in the dollar which had quite a day on Tuesday or Wednesday


Maybe when the DEMOCRATS came to town they decided to put and END TO FRAUD IN BANKING SCAMSTERING TOO?????

One can always hope. ...................
and buy GOLD to invest in SECURITY .....

LacklusterNew Global Trend: Dump a Dollar, Buy a Euro#1522522/16/07; 14:23:26

From URL:

"Do you know what underpins, even drives, the global economy? It's not the Federal Reserve Bank or any other central bank. It's not the International Monetary Fund. It's not a specific country. It's not gold, oil or any other commodity. It's not currency traders. It's not even the almighty greenback."

Don't tell Another.

CometoseWHAT drives the global economy#1522532/16/07; 14:26:49

I was afraid it was going to be a "mystery".
Sierra MadreChávez: "new currency to combat inflation...."#1522542/16/07; 14:40:38

Chávez of Venezuela is digging his own grave.

Not that he is doing anything that all other governments do every day as a matter of course; he is only doing it faster.

Diddling with paper money. The power-hungry just can't keep their hands out of that game. Too tempting. Indispensable, in fact - democracy requires it.

But, Chávez is going a bit too fast. Will he moderate his "program" at some point, or keep on going until Venezuela is another Cuba? Venezuela is not an island and has a much larger population...

Did you know that at last count, Argentina, since about 1930, has eliminated 22 (twenty two) zeros from its currency? So Venezuela starts off now, with three zeros.

ALL Argentinians that are upper middle class and on upward, have substantial amounts of investments OUTSIDE Argentina. I believe they are, one and all, confirmed tax-evaders and their attitude is: "Tax my capital OVER MY DEAD BODY." And that's WHY they are upper middle class, because they keep substantial assets offshore.

Well, have a good weekend, fellow "goldmeisters". This week was quite satisfactory, I'd say.


He will not be around much longer, IMO.

USAGOLD Daily Market ReportPage Update!#1522552/16/07; 15:29:49">
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

February 16 (Reuters, DowJones) -- U.S. gold futures retraced early losses to end higher on Friday, helped by a weak dollar against the euro and firmer oil, as open interest in the gold futures has set a new record.

Markets will be closed Monday in observance of President's Day.

The COMEX April gold contract settled up $1.40 at $672.80 after peaking at $674.10 in early electronic trade, near its six-month high of $676.60 set on Wednesday. Gold futures fell early on profit taking, with prices bottoming at $666.70. By late morning, they turned higher as crude prices rallied and the dollar came off its session high against the euro.

The dollar edged up against the euro and yen, but was still headed for its steepest weekly decline in two months against a basket of major currencies.

"It was just the euro-dollar related thing today," said Bruce Dunn at Auramet Trading. Short covering also helped push bullion higher late in the session, Dunn said. Dunn said gold had support around $663 to $665. He added prices could soften next week because the Chinese market might already have bought gold ahead of the Chinese New Year holiday break, which begins Sunday.

Jes Black, fund manager with Black Flag Capital Partners, commented that the metal is working higher again after a long consolidation period after hitting 26-year highs last spring. "The macro scene is that the big run-up we had in 2006 was digested by the market until recently," he said. Now, the metal is "reasserting itself" and starting to break out of its range, moving higher against all major currencies lately.

Based on factors such as money-supply figures and gold production, Black said he believes the yellow metal has a value of around $800. "We think gold is going to attain an equilibrium level this year around $800," he continued.

"It's now starting to break out of this three-quarters-of-a-year consolidation pattern after an unsustainable move from $500 to $700 in a matter of months."

A market will often "burn a lot of people" when it rises as rapidly as gold did during the early part of 2006, explained Black. "People don't want to get back into that market right away," he said.

"So what happens is the market digests, consolidates, people lick their wounds, and then it's off again. I think that's what's happening. ... The move is very technical. I think it's going to attract a lot of buyers. This breakout over the last four to five weeks looks good from a technical perspective, and I think we will start to attract buyers."

Ralph Preston, senior market analyst with Heritage West Financial, commented that the rally that has occurred so far since the beginning of the year has not appeared to be tied to any major fundamental news.

Now, he said, "we're just a headline away from being above $700, basically."

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

Sprout$$$$ 775.50 $$$$#1522562/16/07; 18:42:09

As for the price of gold this year and why,,,

hmmmm thats a tough one,,,,

dont think i can put the amount in DOLLAR terms
in times of deficits that dont matter, no bid contracts, shipping jobs out of the country, illegal immigrants allowed credit cards, endless war, skids of hundreds being dropped, the canceling of debts, base metal prices going up, base food prices going up, subprimes blowing up, consumer spending flat, consumer sediment down, consumer confidence down, industrial production down, net out flow of foreign funds, housing falling, re re re refi home ATM party over, unemployment rising, ect ect ect.........

So in times of uncertainty in what the Fed/Current Administration has in store for us,,,, id have to say Gold is



a small price to pay for peace of mind,,,,
especially when one doesnt know where the NEXT Few Hundred Tons of Hundreds Will Fall

mikal as for your
Corn-based ethanol's a flawed concept

id go so far as saying,,,,,, so is the concept of Fraction Reserve Banking.....

but hey,,, thats just my opinion,,,,,, well not really just mine, its been refereed to here many times
in the Hall of Fame & Gold Trail - Thoughts links on top of page.....
But it looks flawed to me also....

i know i know,,,, i need to put on my rose colored glasses.....
wish i knew where i put them

Good Luck to All

ToolieNew Security Architecture#1522572/16/07; 20:51:14

There have been a bunch of articles recently about new weapon systems that the US has in development. Is this intended to instill confidence in the US's military R&D?
I wonder if there was a new paradigm explained to Dick Cheney during his last visit to Saudi. I notice reconciliation between the Palestinian warring factions that Washington opposes. I notice SAMs in the possession on Sunnis in Iraq, while DC raises a stink about Iran providing weapons to Shiites. I notice that Russia has just committed its self to rebuilding its advanced arms development industry.

If not a change in paradigm, a threatened one methinks.

Toolie: I had just made the above post on Another (political) site, when I came across this article below.

Snip: The Need for a New Security Architecture

Vladimir Putin has described the need of a new international security arrangement, a multipolar arrangement that protects everyone's interests. This, too, is needed in the Middle East, says Patrick Seale. (end snip)

The sands of power are shifting. As I'm sure that the Knights and Ladies that study here understand, our security relationship with the Gulf States is of great importance to the financial well being of the US government. From a middle-east perspective it may make a good deal of sense to have their security provided by people that are not in such desperate need of their oil.

When Russian "IRON" flows to the Middle East.
US gold will flow or the oil will not.

Gandalf the WhiteTAA TAA TAAAAAAAAAAAAAAAAAAAAA ! --- UPDATE #1522582/16/07; 21:11:40

$$$$$$$$$$$$$$ THE FEBRUARY 2007 "PRICE of GOLD" GUESSING CONTEST!! $$$$$$$$$$$$


Entries as of DAY #2 -- (2/16/07) at just about 21:09 Denver time !!!

Listed in order of decreasing values !

$$$$ 775.50 $$$$ Sprout (2/16/07; 18:42:09MT - msg#: 152256)

$$$$ $724.6 $$$$ Topaz (2/15/07; 04:55:38MT - msg#: 152177)

$$$$ $695.0 $$$$ Sundeck (2/16/07; 04:38:24MT - msg#: 152221)

$$$$ $688.0 $$$$ Goldilox (2/16/07; 11:26:32MT - msg#: 152238)

$$$$ $687.8 $$$$ Lebieque (2/15/07; 03:55:18MT - msg#: 152174)

$$$$ $685.0 $$$$ Toolie (2/15/07; 03:10:40MT - msg#: 152170)

$$$$ $662.5 $$$$ Henri (2/16/07; 11:02:33MT - msg#: 152235)

$$$$ $658.0 $$$$ flow5 (2/15/07; 12:19:26MT - msg#: 152184)


mikal2010 countdown#1522592/16/07; 22:37:48 North American Union: A Profound Solution to the Treachery
We The People Foundation - Feb 12, 07
Please sign petition- Petition Congress for redress of grievances. Thank you.

mikalWhy do I need a Social Security #, pay taxes?#1522602/16/07; 23:12:43 Mexicans must be government employees. I must be a 'subject'. Without a doubt, more mercenaries and
parasites are coming to keep us in line:

BofA Offers Credit Cards To Illegals Without SSI Cards
by Frosty Wooldridge
Comments on this week's Marketwatch article with links and suggested courses of action. I feel like Shakespeare's Othello with his remorse over the murder when the hopeless bloodstain elicits his "Out damned spot"- the 30+ million Mexicans and other illegals are here to stay to further weaken the host republic.

mikalCorrection- Lady Macbeth#1522612/16/07; 23:21:40

Lady Macbeth, not 'Othello' said "Out damn spot"
and: "Here's the smell of the blood still. All the perfumes of Arabia will not sweeten this little hand."

mikal(No Subject)#1522622/16/07; 23:29:03

Correct punctuation and spelling: "Out, damned spot! Out I say!
One, two, why, then 'tis time to do't. Hell is murky!"

mikal(No Subject)#1522632/17/07; 00:37:40

Drop in Capital Flow to U.S. Poor Dollar Omen by Nick Olivari - Analysis | Reuters - Feb 16, 2007
Silver FoxLackluster #: 152252#1522642/17/07; 05:29:53

Re: The Trumpet link.

Thanks for posting this link. I found it very informative.


slingshotmikal#1522652/17/07; 07:20:49

Sent your links to friends. MSGS. 152259 and 152260.

Minero$$$$$ $666.6 $$$$$#1522662/17/07; 07:39:45

The TPTB may help me win this contest.

As to the end of year POG: I most sincerely hope that the price of gold is below $700. I can't help but see a bleak future for the dollar. About all that I hope for is more time to get ready for the problems that are undoubtably on the way. I have about all the shiney that I can afford, I am now looking at basics.

Thoreauly**** $727.5 *****#1522672/17/07; 07:46:31

I'm with Sierra Madrea (#152246) and believe that the December 2006 TICs report is not an anomally but the beginning of a trend. If so, then the Fed will indeed have to make up the difference by buying US Treasuries to cover the fiscal gap, driving up yields and therefore interest rates, worsening the housing collapse and driving the economy into recession.

Stagflation, in other words, with gold responding accordingly.

mikal@Slingshot#1522682/17/07; 08:22:25 Thanks. A good one that just came off MK's newswire:
Continental Integration Talks Spark Fierce Debate in U.S.
Kelly Patterson | CanWest News Service - 02/17/07

mikalNeed for transparency and free markets#1522692/17/07; 09:26:10

Monetary Policy and the State of theEconomy
by Ron Paul
Statement at Hearing of the House Financial Services Committee, February 15, 2007
Transparency in monetary policy is a goal we should all support. I've often wondered why Congress so willingly has given up its prerogative over monetary policy. Astonishingly, Congress in essence has ceded total control over the value of our money to a secretive central bank.
Congress created the Federal Reserve, yet it had no constitutional authority to do so. We forget that those powers not explicitly granted to Congress by the Constitution are inherently denied to Congress – and thus the authority to establish a central bank never was given. Of course Jefferson and Hamilton had that debate early on, a debate seemingly settled in 1913.
But transparency and oversight are something else, and they're worth considering. Congress, although not by law, essentially has given up all its oversight responsibility over the Federal Reserve. There are no true audits, and Congress knows nothing of the conversations, plans, and actions taken in concert with other central banks. We get less and less information regarding the money supply each year, especially now that M3 is no longer reported.
The role the Fed plays in the President's secretive Working Group on Financial Markets goes unnoticed by members of Congress. The Federal Reserve shows no willingness to inform Congress voluntarily about how often the Working Group meets, what actions it takes that affect the financial markets, or why it takes those actions.
But these actions, directed by the Federal Reserve, alter the purchasing power of our money. And that purchasing power is always reduced. The dollar today is worth only four cents compared to the dollar in 1913, when the Federal Reserve started. This has profound consequences for our economy and our political stability. All paper currencies are vulnerable to collapse, and history is replete with examples of great suffering caused by such collapses, especially to a nation's poor and middle class. This leads to political turmoil.
Even before a currency collapse occurs, the damage done by a fiat system is significant. Our monetary system insidiously transfers wealth from the poor and middle class to the privileged rich. Wages never keep up with the profits of Wall Street and the banks, thus sowing the seeds of class discontent. When economic trouble hits, free markets and free trade often are blamed, while the harmful effects of a fiat monetary system are ignored. We deceive ourselves that all is well with the economy, and ignore the fundamental flaws that are a source of growing discontent among those who have not shared in the abundance of recent years.
Few understand that our consumption and apparent wealth is dependent on a current account deficit of $800 billion per year. This deficit shows that much of our prosperity is based on borrowing rather than a true increase in production. Statistics show year after year that our productive manufacturing jobs continue to go overseas. This phenomenon is not seen as a consequence of the international fiat monetary system, where the United States government benefits as the issuer of the world's reserve currency.
Government officials consistently claim that inflation is in check at barely 2%, but middle class Americans know that their purchasing power – especially when it comes to housing, energy, medical care, and school tuition – is shrinking much faster than 2% each year.
Even if prices were held in check, in spite of our monetary inflation, concentrating on CPI distracts from the real issue. We must address the important consequences of Fed manipulation of interest rates. When interests rates are artificially low, below market rates, insidious mal-investment and excessive indebtedness inevitably bring about the economic downturn that everyone dreads.
We look at GDP numbers to reassure ourselves that all is well, yet a growing number of Americans still do not enjoy the higher standard of living that monetary inflation brings to the privileged few. Those few have access to the newly created money first, before its value is diluted.
For example: Before the breakdown of the Bretton Woods system, CEO income was about 30 times the average worker's pay. Today, it's closer to 500 times. It's hard to explain this simply by market forces and increases in productivity. One Wall Street firm last year gave out bonuses totaling $16.5 billion. There's little evidence that this represents free market capitalism.
In 2006 dollars, the minimum wage was $9.50 before the 1971 breakdown of Bretton Woods. Today that dollar is worth $5.15. Congress congratulates itself for raising the minimum wage by mandate, but in reality it has lowered the minimum wage by allowing the Fed to devalue the dollar. We must consider how the growing inequalities created by our monetary system will lead to social discord.
GDP purportedly is now growing at 3.5%, and everyone seems pleased. What we fail to understand is how much government entitlement spending contributes to the increase in the GDP. Rebuilding infrastructure destroyed by hurricanes, which simply gets us back to even, is considered part of GDP growth. Wall Street profits and salaries, pumped up by the Fed's increase in money, also contribute to GDP statistical growth. Just buying military weapons that contribute nothing to the well being of our citizens, sending money down a rat hole, contributes to GDP growth! Simple price increases caused by Fed monetary inflation contribute to nominal GDP growth. None of these factors represent any kind of real increases in economic output. So we should not carelessly cite misleading GDP figures which don't truly reflect what is happening in the economy. Bogus GDP figures explain in part why so many people are feeling squeezed despite our supposedly booming economy.
But since our fiat dollar system is not going away anytime soon, it would benefit Congress and the American people to bring more transparency to how and why Fed monetary policy functions.
For starters, the Federal Reserve should:
Begin publishing the M3 statistics again. Let us see the numbers that most accurately reveal how much new money the Fed is pumping into the world economy.
Tell us exactly what the President's Working Group on Financial Markets does and why.
Explain how interest rates are set. Conservatives profess to support free markets, without wage and price controls. Yet the most important price of all, the price of money as determined by interest rates, is set arbitrarily in secret by the Fed rather than by markets! Why is this policy written in stone? Why is there no congressional input at least?
Change legal tender laws to allow constitutional legal tender (commodity money) to compete domestically with the dollar.
How can a policy of steadily debasing our currency be defended morally, knowing what harm it causes to those who still believe in saving money and assuming responsibility for themselves in their retirement years? Is it any wonder we are a nation of debtors rather than savers?
We need more transparency in how the Federal Reserve carries out monetary policy, and we need it soon.
February 17, 2007
Dr. Ron Paul is a Republican member of Congress from Texas.

Liberty Head****$670.0****#1522702/17/07; 10:03:22

To predict future movements in the POG, I use the "Stupidity Index".
Congress has just passed a non-binding resolution against the war. At the same time they also voted for increased spending on the war. There have been no riots in the streets.
As long as the American public remains predominately stuck on stupid and stuck on docile, gold will continue to rise in dollar terms.
Any country that has encouraged or tolerated despotism over liberty has experienced complete currency failure.
Gold will shine more and more as it continues to be polished by fools with paper.

Best Wishes

Lothar of the Hill People$$$ 673.5 $$$#1522712/17/07; 13:25:18

Lothar, secreted in the ancestrial cave of the Hill People, protected from the ravages of winter has heard the distant call to Contest! Time passes slowly and Contest is a welcome diversion. Lothar and the other elders have sat about the sacred shrine of the Great Albino Bat for many hours reflecting upon many things--we see the POG jump and then retreat remaining in a trading range about $670 as the prime rate is left untouched through March and May. But in June, as the unacknowledge stagflation becomes undenyable, the FED will raise it one and twice. Gold will reach $800 before the end of the year, but will be manipulated back down and will range about $725 as the year progresses and ends.

I am Lothar, of the Hill People. Fare ye well.


(sorry I'm "late"!) <;-)

$$$$$$$$$$$$$$ A "PRICE of GOLD" (POG) GUESSING CONTEST!! $$$$$$$$$$$$

We shall have a price guessing contest on the closing (Settlement price) of gold for the April COMEX Contract (GCJ07) on the last day of this month. Wednesday, February 28, 2007, ---BUT all entries must be posted to the TableRound before Midnight on Saturday, February 24th, AND ALL ENTRIES must answer "THE QUESTION" !!

Based on numerous prognostications from both recognized metals industrial companies executives, financial "experts", taxi drivers, and "politicians" – that the price of gold this year will be somewhere between $500 and $2,000, the QUESTION is:

What do you think the price of gold (POG) will be this year, AND, in thirty words or more, Why????

This POG Contest winner -- the closest price guess to the actual Settlement Price -- will receive a rather rare collectors piece, a Danish 20 Kroner goldpiece, having the likeness of King Christian IX on the obverse, but commonly known as a "Mermaid" for the content of the reverse side of the coin !

The "Mermaid" 20 Kronor goldpiece had a total mintage of only 1.5 million, as compared to the nearly 110 million mintage of its period cousin, the English Queen Victoria sovereigns. It gets its name from the blend of a stoic Lady Liberty, enthroned with what I think is a porpoise or dolphin, swimming at her feet. Christian IX, pictured on the obverse of the coin, was known as the 'father-in-law' of Europe because two of his daughters and one son married into the royal lines of England, Russia and Greece respectively, and his grandson became the King of Norway. This coin is exceedingly popular with the people of Denmark in that the "Mermaid" is the national symbol of the country. These beautiful gold pieces were minted between the years of 1873 and 1900, have a Fineness of 0.900, and Actual Gold Content of 0.2592 troy ounce. This prize coin was minted in the first year of production, 1873 !

There will be also be two runners-up prizes for the next closest prognostications --- each winning an one ounce pure Silver U.S. Eagle.


1) The Winner is the poster with the Price Guess closest to the Settlement price of the COMEX (most active) April 2007 Gold Contract (GCJ07) on the date of Wednesday, February 28, 2007.

2) Price "Guesses" shall be stated in Dollars and tenths !
(Such as $666.6)

3) "Guesses" shall be SHOWN in the SUBJECT BOX location AND enclosed in markers of "Dollar Signs" so as to be OFFICIAL !
(Such as $$$$$ $666.6 $$$$$$$ )

4) ONLY one "Guess" per Knight or Lady is allowed, and once that "Guess" has been "taken" -- no one can duplicate it !! FIRST COME has rights to that "Guess".

5) HOWEVER, All "Guesses" MUST be posted before the clock in Denver strikes MIDNIGHT (24:00) on Saturday, February 24, 2007.

6) AND MOST IMPORTANTLY (as this part MUST accompany the Price prognostication) --- In order for your entry to be valid, entries will need to have a full answer to the QUESTION, in 30 words, OR MORE. <===== NOTE !!!
LET the CONTEST continue !!

USAGOLD / Centennial Precious Metals, Inc.The PRIZE !#1522732/17/07; 14:33:46">gold Mermaid contest prize
Gandalf the WhiteTAA TAA TAAAAAAAAAAAAAAAAAAAAA ! --- UPDATE #1522742/17/07; 14:35:32

$$$$$$$$$$$$$$ THE FEBRUARY 2007 "PRICE of GOLD" GUESSING CONTEST!! $$$$$$$$$$$$


Entries as of DAY # 3 -- (2/17/07) at just about 14:30 Denver time !!!

Listed in order of decreasing values !

$$$$ $775.50 $$$$ Sprout (2/16/07; 18:42:09MT - msg#: 152256)

**** $727.5 **** Thoreauly (2/17/07; 07:46:31MT - msg#: 152267)

$$$$ $724.6 $$$$ Topaz (2/15/07; 04:55:38MT - msg#: 152177)

$$$$ $695.0 $$$$ Sundeck (2/16/07; 04:38:24MT - msg#: 152221)

$$$$ $688.0 $$$$ Goldilox (2/16/07; 11:26:32MT - msg#: 152238)

$$$$ $687.8 $$$$ Lebieque (2/15/07; 03:55:18MT - msg#: 152174)

$$$$ $685.0 $$$$ Toolie (2/15/07; 03:10:40MT - msg#: 152170)

$$$$ $673.5 $$$$ Lothar of the Hill People (2/17/07; 13:25:18MT - msg#: 152271)

**** $670.0 **** Liberty Head (2/17/07; 10:03:22MT - msg#: 152270)

$$$$ $666.6 $$$$ Minero (2/17/07; 07:39:45MT - msg#: 152266)

$$$$ $662.5 $$$$ Henri (2/16/07; 11:02:33MT - msg#: 152235)

$$$$ $658.0 $$$$ flow5 (2/15/07; 12:19:26MT - msg#: 152184)


TopazThe Fanfare of the Common Man.#1522752/17/07; 16:44:20

Ah yes Gandalf, ...loud and long may you blow TAA TAA TAAAAAA etc. nice to see a rousing response getting in early for the good seats.

Reading the detail on "the Prize", it would be fitting if either Sundeck or I end up with the spoils.
You see, we Aussies are in fact proxy in-laws of Denmark having recently had "Our Mary" give birth to their future King.
I'm also proud to say my grand-daughter has a fixation with Ariel at present. The part where you become a mermaid when you drown is causing some concern at bath-time though.

I have also mastered "Fanfare" on my Harmonica and would be flattered if you requested a free copy ...$20 P@H of course ;-)

SundeckGold prizes and issues of heritage#1522762/17/07; 19:32:33

@Sir Topaz #152275 and Sir Henri #152233

An excellent idea Sir fitting in fact that I think the contest should be abandoned herewith and the prizes awarded in the manner you suggest...


Note also that the 20 Kronor "Mermaid" coin was minted in 1873, coinciding with the gold rush that swept the Gundagai area between 1861 and about 1876 (see link), so there is a good chance that the coin is made from Aussie gold! Added justification for awarding the spoils to we Aussies!!


Sir Henri ref your #152233

Yes, I am indeed Don Sundeck del la Canberra, which is just an hour and a bit drive down the freeway from Gundagai, where Spot still sits on the tuckerbox (waiting for another gold rush, perhaps).

Gundagai appears to be one of the few towns in Australia that does NOT owe its presence to gold being discovered in the vicinity, but, as you can see from the link, it has featured prominently in the great gold rushes of the 1850s and thereafter.

On occasion when driving to Melbourne (once the wealthiest city in the world, during the Victorian gold rushes of the mid to late 1800s) I stop for breakfast in Gundagai at the Niagara Cafe (highly recommended) avoiding the plethora of fast-"food" stops on the nearby Hume Highway.

You might find a little gold in the Murrumbidgee River, if you are patient, but you won't see any "mermaids"...unless, of course, you spend too long at one of the local hotels. I am fairly confident that "the pub with no beer" is not a Gundagai establishment.

Thanks, Sir Henri, for your kind words...I'm always happy to please.


mikal"Policymakers are between a rock and a hard place"#1522772/17/07; 19:44:22

We'll all carry the can if yen binge miscarries | Business | Money | Telegraph | Liam Halligan, Economics Editor, Sunday Telegraph - Last updated 11:59 GMT February 17, 2007
Among other things, will the Bank of Japan raise their lending rate Wednesday as some expect, and what will
currency traders do?

Rook.,.#1522782/17/07; 19:55:35

One of the boys in the house offered up the price guess, and as to WHY, the reason is, that despite the flak that the gata folks get, they are correct to say the price is controlled. Not controlled by me of course, because then I would make sure the price I submit wins.
What SHOULD the price of gold be? Well, look at the prices of art work these days, it is amazing what heights are being reached in that alleged store of wealth.

mikal@Topaz, Sundeck#1522792/17/07; 20:23:00

Staking a claim for the mermaid are ye mates?
Well, go ahead and have a whale of a time. Tis' freedom of the seas about even still!
As for me, why cast me bread upon the waters? A fish out of water among yer kind me crew and I be. And
the oceans can only hold so much flotsam and jetsom
before things get gummy.
But Smeagol's one who LOVES fish!
I wouldn't get between him and a fair mermaid, let alone a Danish sort if I were ye. But whatever floats your boat.

Silver FoxLiberty Head #: 152270#1522802/17/07; 22:25:37

Stupidity Index

Sorry, but I am inclined to disagree with you. I have some very smart friends who are clueless. With a media bent on spin and dis-information, the American public is largely in the dark about what is happening in the markets. I feel you must give credit to big business which is working hard on making sure they remain clueless.

Free press, wrong. Orwellian press, right.


GoldiloxClueless#1522812/17/07; 23:28:15

@ Silver Fox,

I am inclined to agree with you. As Jefferson once noted, nothing is more dangerous to a democracy than an uninformed electorate.

So long as the media keeps the majority busy with "Info-tainment" rather than real news, the "silent majority" remains the "ill-informed majority". History has demonstrated time and time again that they will align themselves with whomever waves "their flag" the most vigorously and the most loudly, never taking even a moment to weigh the motives of those doing the waving.

That's also why wars (especially religious wars) are the very epitome of group insanity redirected for covert purposes. The minions who are so anxious to be "dead right", are programmed to believe that it is sacrilege to question the "spokesmen for the gods" who put them in harm's way.

As long as gold-bugs are a minority, TPTB will be satisfied with "price containment". If John Q ever wakes up to the FIAT swindle, the scams introduced to keep him away from money with intrinsic value will dwarf anything we've yet witnessed.

Lebieque"PRICE of GOLD" GUESSING CONTEST nag#1522822/18/07; 01:32:44

Come on y'all. This contest is supposed to be a test of skill and acumen to prove your prowess interpreting the IMF, it's World Bank and their lackeys, the Bullion Bank's, endeavours to produce liquidity from nothing on the one hand, and discrediting hard money on the other. Waiting until the last day will leave you with that hollow feeling you get after an attempt at insider trading, possibly lucrative but meaningless in testing real worth.
SundeckStacking the deck?#1522832/18/07; 02:47:23

@Lebieque #152282

Well spaketh ye, Sir/Lady Lebieque...

I agree, but it all depends on how quickly the autocorrelation funcion of gold price (actually, ESTIMATED gold price) decays with time...I suspect that four days (24th to through 28th) is sufficient "randomising" time...

But you are would feel a lot better "getting it right" from 14 days out, rather than 4 days out...

...and any hunter will know that it is frequently harder to hit your game from close-at-hand rather than from a good and fair distance...


mikalShort comments on dollar dilemna#1522842/18/07; 07:50:01

DECLINING DOLLAR IS A TIME BOMB - BUT HOW BIG? - Business - John Crudele - New York Post Online Edition - February 18
Liberty HeadGoldilox, Silver Fox#1522852/18/07; 08:46:46

Both of you see the american public as playing the role of child in a parent/child relationship with some big daddy/mommy entity. You are correct.
I say that is stupid. Adults accept responsibilty for screening information for truthiness, children don't.
Who's responsible for deciding what information you use to make decisions about your life? You or someone else?
If the answer is not "you", than I must conclude "you" are stupid.
"You" being the voluntarily brain washed american public.

Best Wishes

Chris PowellRussian miner bids for AngloGold#1522862/18/07; 09:53:06

Russians Covet AngloGold

By John Waples
The Times, London
Sunday, February 18, 2007

Russia's Polyus Gold, which is preparing for a London listing, has approached Anglo American to buy its £2.25 billion stake in another mining company, AngloGold Ashanti.

If this were to happen, it would turn Polyus into one of the world's most powerful gold producers. Polyus has indicated it would like to buy part or all of the stake.

One option under consideration is for Anglo American, which owns 41 percent of AngloGold, to take a minority stake in an enlarged company. Tony Trahar, Anglo American's outgoing chief executive, has made it clear the group's entire stake in the South African gold company is up for sale. Polyus is one of several companies that have made approaches to buy it.

The sale forms part of Anglo American's strategic plan to sell noncore assets. The other big asset being offloaded by the mining giant is Mondi, its paper-and-packaging business which, including debt, is worth some £4 billion. The intention was to demerge this, with a primary listing on the London stock market.

The proposal has met resistance from South African-based investors and the country's treasury department. To pacify these concerns Trahar has now quietly put forward a new proposal to conduct a dual listing of Mondi shares in London and Johannesburg. Sir John Parker has already been recruited as chairman and if the dual listing is acceptable the float could take place in the middle of this year.

Anglo American's big rivals, BHP Billiton and Rio Tinto, have both looked hard at whether a takeover of the company is feasible. This speculation has resulted in a huge outperformance in Anglo's shares that has in effect put it out of reach.

Analysts say that Anglo has head room to increase borrowings and finance a large acquisition. The group could be debt-free within four months.

mikal(No Subject)#1522872/18/07; 10:41:47

Scientists, academics laud grid computing | | CNET - Feb 18
Short comments on this new research technique include: "The grid not only aids scientific research, it is also
having an impact on the commercial and financial world."


$$$$$$$$$$$$$$ A "PRICE of GOLD" (POG) GUESSING CONTEST!! $$$$$$$$$$$$

We shall have a price guessing contest on the closing (Settlement price) of gold for the April COMEX Contract (GCJ07) on the last day of this month. Wednesday, February 28, 2007, ---BUT all entries must be posted to the TableRound before Midnight on Saturday, February 24th, AND ALL ENTRIES must answer "THE QUESTION" !!

Based on numerous prognostications from both recognized metals industrial companies executives, financial "experts", taxi drivers, and "politicians" and OTHERS –- that the price of gold this year will be somewhere between $500 and $2,000, the QUESTION is:

What do you think the price of gold (POG) will be this year, AND, in thirty words or more, Why????

This POG Contest winner -- the closest price guess to the actual Settlement Price -- will receive a rather rare collectors piece, a Danish 20 Kroner goldpiece, having the likeness of King Christian IX on the obverse, but commonly known as a "Mermaid" for the content of the reverse side of the coin !

The "Mermaid" 20 Kronor goldpiece had a total mintage of only 1.5 million, as compared to the nearly 110 million mintage of its period cousin, the English Queen Victoria sovereigns. It gets its name from the blend of a stoic Lady Liberty, enthroned with what I think is a porpoise or dolphin, swimming at her feet. Christian IX, pictured on the obverse of the coin, was known as the 'father-in-law' of Europe because two of his daughters and one son married into the royal lines of England, Russia and Greece respectively, and his grandson became the King of Norway. This coin is exceedingly popular with the people of Denmark in that the "Mermaid" is the national symbol of the country. These beautiful gold pieces were minted between the years of 1873 and 1900, have a Fineness of 0.900, and Actual Gold Content of 0.2592 troy ounce. This prize coin was minted in the first year of production, 1873 !

There will be also be two runners-up prizes for the next closest prognostications --- each winning an one ounce pure Silver U.S. Eagle.


1) The Winner is the poster with the Price Guess closest to the Settlement price of the COMEX (most active) April 2007 Gold Contract (GCJ07) on the date of Wednesday, February 28, 2007.

2) Price "Guesses" shall be stated in Dollars and tenths !
(Such as $666.6)

3) "Guesses" shall be SHOWN in the SUBJECT BOX location AND enclosed in markers of "Dollar Signs" so as to be OFFICIAL !
(Such as $$$$$ $666.6 $$$$$$$ )

4) ONLY one "Guess" per Knight or Lady is allowed, and once that "Guess" has been "taken" -- no one can duplicate it !! FIRST COME has rights to that "Guess".

5) HOWEVER, All "Guesses" MUST be posted before the clock in Denver strikes MIDNIGHT (24:00) on Saturday, February 24, 2007.

6) AND MOST IMPORTANTLY (as this part MUST accompany the Price prognostication) --- In order for your entry to be valid, entries will need to have a full answer to the QUESTION, in 30 words, OR MORE. <===== NOTE !!!
LET the CONTEST continue !!


$$$$$$$$$$$$$$ THE FEBRUARY 2007 "PRICE of GOLD" GUESSING CONTEST!! $$$$$$$$$$$$


Entries as of DAY #4 -- (2/18/07) at just about 10:51 Denver time !!!

Listed in order of decreasing values !

$$$$ $775.50 $$$$ Sprout (2/16/07; 18:42:09MT - msg#: 152256)

**** $727.5 **** Thoreauly (2/17/07; 07:46:31MT - msg#: 152267)

$$$$ $724.6 $$$$ Topaz (2/15/07; 04:55:38MT - msg#: 152177)

$$$$ $695.0 $$$$ Sundeck (2/16/07; 04:38:24MT - msg#: 152221)

$$$$ $688.0 $$$$ Goldilox (2/16/07; 11:26:32MT - msg#: 152238)

$$$$ $687.8 $$$$ Lebieque (2/15/07; 03:55:18MT - msg#: 152174)

$$$$ $685.0 $$$$ Toolie (2/15/07; 03:10:40MT - msg#: 152170)

**** $678.0 **** Rook (2/17/07; 19:55:35MT - msg#: 152278)

$$$$ $673.5 $$$$ Lothar of the Hill People (2/17/07; 13:25:18MT - msg#: 152271)

**** $670.0 **** Liberty Head (2/17/07; 10:03:22MT - msg#: 152270)

$$$$ $666.6 $$$$ Minero (2/17/07; 07:39:45MT - msg#: 152266)

$$$$ $662.5 $$$$ Henri (2/16/07; 11:02:33MT - msg#: 152235)

$$$$ $658.0 $$$$ flow5 (2/15/07; 12:19:26MT - msg#: 152184)


Gandalf the WhiteHEAR, HEAR, HEAR ----- BRAVO !!!!!! <;-)#1522902/18/07; 10:54:03

Lebieque (2/18/07; 01:32:44MT - msg#: 152282)
USAGOLD / Centennial Precious Metals, Inc.The PRIZE !#1522912/18/07; 11:27:09">gold Mermaid contest prize
968China confirms gold mine reserves of 650 tons#1522922/18/07; 11:40:26

China's gold mine reserves increased more than 650 tons in 2006, said the National Development and Reform Commission (NDRC).
See URL for complete text.

Silver FoxLiberty Head #: 152285#1522932/18/07; 12:26:44

Sorry, but I am still inclined to disagree with you. Although I will concede that the majority don't bother to read. But then there is my friend Ed, who is the president of a ~ $40mm/yr company here in SoCal. He works between 60 to 70 hours per week. He is also a grandfather, who tries to spend time with his family. By the time you add in his exercising, Ed is short on time to do much in the way of reading. So other than the spin he get's from the Wall Street Journal and Barron's, he is pretty much in the dark of the dreadful economic under current in the world today. I have other friends that are also just too busy, and as a result, they are in the same "clueless boat".

When I speak to Ed about "our" situation, he has a hard time following my arguments because I am outside of the curtains of his paradigm that are formed by the media's disinformation campaign. I would expect that you also probably have the same problem explaining the "situation" to some of your "brainy" friends.

The only people I know who are aware of our countries dire financial straits are the ones who have had macroeconomics as a hobby for a long time, and have the associated back ground information needed to understand what is going on. I believe "we" are rare and may represent only 1 out of 1,000, or even less.

Hope this helps.


mikal@ChrisPowell#1522942/18/07; 13:13:25

Re: msg#152286
Source says Polyus not seeking Anglo Gold stake
Sun Feb 18, 2007 4:58PM GMT
(Reuters) - Excerpt: "A source close to Polyus Gold denied on Sunday a newspaper report that Russia's top gold miner had approached Anglo American to buy a stake in Anglo Gold Ashanti.
"It's total nonsense," the source close to the company said."
Mikal- Did someone get more than they bargained for?

Freedom$$$$684.8$$$$#1522952/18/07; 13:37:59

I have been reading that Chinese astrologers have termed today ~ the beginning of The Year of the Fire Pig. The story goes that The Pig is a water sign and is not compatible with fire; therefore the year will be one of change, turmoil and conflict.

This brings me to my answer to THE QUESTION. In my opinion, the price of gold will set a new record high this year; going well over $850 an ounce. I say this because I see gold prices DRIVEN by all those uneasy feelings everyone has these days.

The value of gold, much like the value of say ~ a cure for cancer ~ will eventually become immeasurable; when the opposing forces of CONTROL (paper, plastic, digital, untouchable money) come into conflict with the forces of FREEDOM (gold, silver, real money). Those people ~ who do not want to be traced (they will be called criminals, no matter the reason they desire to be anonymous) by chip embedded paper and plastic or by digital transactions ~ will find only one way to eat; only one way to escape the tyranny: gold.

Thank you for having this contest. I don't believe I have enough knowledge to actually guess the price of gold; but at least you give everyone here an honest opportunity to express their feelings on the subject.

GoldiloxUninformed#1522962/18/07; 13:38:29

@ Silver Fox,

That's where we disagree. I also work as many as 16 hours a day, six or seven days a week, and still do my best to find reasonable information outlets. I believe that survival depends on it. Some sources come and some go, but I especially pay attention to those posted here, as they tend to be better informed than most.

If someone is the CEO of a budding company, his time may well be limited, as is mine, but his resources aren't. I'm sure he has the same high-speed Internet connection that most of us have, and once he figures out that the WSJ and Barrons are just "trade rags" whose only purpose is to sell stocks in the great pyramid scheme, he'll want to decide where he can get more "balanced" information.

It's very easy for those who appear to be reaping the benefits of wealth transfer to dismiss those who see the inherent dangers as "Chicken Littles", but they put themselves and their families at great risk by adopting that stance.

mikalLow yen admission and prelude to action or?#1522972/18/07; 13:40:37

Key indicator highlights yen plunge | Yuji Ichijo, Yomiuri Shimbun Staff Writer | Daily Yomiuri | Feb 19, 07
Excerpt: "The recent weakness of the yen has drawn attention to the so-called real effective exchange rate indicator, which is used to measure the yen's overall international competitiveness.
The indicator stood at 97.7 in January--almost the same level as September 1985, when the Plaza Accord was signed by the Group of Five major industrialized nations to devalue the dollar--against the base of 100 determined in March 1973.
Considering the present exchange rate of the yen of 120 yen to the dollar it looks as if the yen has appreciated significantly since the Plaza Accord when the exchange rate was about 240 yen to the dollar.
However, in terms of the real effective exchange rate, the yen's value is almost the same as it was at the time of the Plaza Accord. The real effective exchange rate shows that the yen has fallen to a record low level, due to both the yen's weakness compared to other major currencies and the slump in prices of goods and services caused by a deflationary trend."

Mikal- This story off of MK's newswire seems
dull at first glance. I believe it's relevant is:
1) The significance of implied official support for a long-delayed higher yen "real effective exchange rate" as
seen in this mainstream Japanese paper Monday morning.
2) The effect on POG if the yen carry trade unwinds through an accident, a BOJ rate rise, or other
3) The implications for gold as Japan's savers and investors continue to seek safety & the highest performer.
4) The meaning for the dollar if yen bets reverse/carry trade unwinds in anticipation of or following a yen revaluation.

Silver FoxGoldilox #: 152296#1522982/18/07; 14:12:29

I guess we will agree to disagree.

However, I do appreciate your comments and have a question for you:

First, it appears that the US is on a collision course with Iran. One of the Pentagon reports I heard stated that if the US attacks Iran, the military would not be able to keep the Strait of Hormuz open. I have also heard that currently, about 25% of the world's oil passes through this strait. The Pentagon report also estimated that the attack, the price of oil would subsequently jump to roughly to $250 per barrel, or basically five times more than today's price. Given this potential increase in the price of oil, one would expect that the price of gasoline would then jump to ~$12.50 per gallon. Finally, correct me if I am wrong, but the commerce in the US is based on the use of cheap oil. My question is: if Iran is attacked, do you think that the $12.50 per gallon price is realistic and if so, do you think that this increase in cost in gasoline will cause the collapse the derivatives market?


mikal(No Subject)#1522992/18/07; 14:14:03

End of week charts and commentary - very nice collection of charts and commentary from Dan Norcini. Gold in $, euros, yen, continuous CRB, $index and others:
TownCrierDay trading rising with bull market#1523002/18/07; 14:35:09,0,3928692.story?coll=chi-business-hed

February 18, 2007 -- As stocks soared in the 1990s, countless Wall Street wannabes became "day traders," quitting their jobs and trying to make their living by trading stocks at a furious pace.

When the boom ended, so did the day-trading craze. But rising stock prices and new highs in major stock indexes have tickled investor interest, and aggressive trading by individuals is on its way back.
Back then, fewer people had high-speed Internet connections, leading to the establishment of day-trading shops stocked with rows of computer stations. Caffeine-fueled traders "scalped" a handful of stocks all day long, jumping in and out repeatedly as stocks bounced like ping-pong balls. The goal was to notch dozens of small gains.

Many traders, however, lost substantial amounts of money and had to surrender.

Stocks are much less volatile today, forcing traders to hold for days or weeks to net sizable gains...

...several experts said they're surprised that trading levels aren't higher, given the market's lengthy rise. "Usually you have a bull market and it attracts investors."

Some investors are holding back because of bad memories from the last bear market and uncertainty about how much longer the current bull market will run. And many people may have shifted their money into real estate earlier this decade, as stocks tanked and home prices rose.

"I don't think the speculative money is coming back into the online investor marketplace," said Don Montanaro, chief executive of TradeKing, a Boca Raton, Fla.-based online broker. "It's tied up in the condo market in Miami."

Nevertheless, interest in trading is heating up.

...[A day trader said] he's seen a lot of his friends fail over the years and predicts that many more will.

"I see a lot more newcomers than in 2005," he said. "Most of them wash out in the first six months. Very few of them stay."

^---(see url)---^

Apparently, lots of smarter-than-average people have become better-than-average at finding ways to fritter away their gaming resources, many of them failing to take chips off the table for the all-important consolidation of "game income" into real-life WEALTH (i.e., tangibles). When the game goes badly, they have nothing left to show for their years.

If "the unexamined life" is not worth living (Socrates), what similar assessment would apply to the "intangible life" -- the one obsessed with digit-making over tangible productivity and hands-on reality?


GoldiloxStraits of Hormuz and oil prices#1523012/18/07; 17:08:01

@ SF,

The question that must be asked is whether the Pentagon POO estmates are on the conservative side, to downplay the ramifications, or on the liberal side to try and forestall them. I am the first to admit that I do not have enough evidence to weigh in on that one.

Seeing gas prices go "through the roof", or implementing war rationing once again, sure would deliver a WebBot hit on "restricted movement".

GoldiloxGold increasingly seen as viable investment#1523022/18/07; 17:32:57


SINGAPORE : Special designs for special occasions, the attraction of gold never fails.

And this Lunar New Year is no different, only more are buying with sales of gold jewellery going up by between 10 and 30 percent.

But as Wong Mun Wai finds out, many Singaporeans are buying them not for their glitter alone.

While jewellers may have made many gold ornaments marking the Year of the Pig, the precious metal has a bigger role than just marking a major holiday. Gold is a player on the global financial markets.

The price of gold has more than doubled in the last five years to over $220 an ounce, and it is beginning to be seen more of as an investment, especially when other traditional sources are not performing well.


Ok, Asians seem to be "getting a clue" quicker than the west, but they traditionally distrust their gubmints, and have experience much more invasion and regular local turmoilthan most westerners.

Governments come and go, but for at least our recorded history as a civilization, gold endures!

Sierra MadreSilver Fox, your post #152293: How many? It all depends....#1523032/18/07; 18:46:44

"I believe "we" are rare and may represent only 1 out of 1,000, or even less."

Well, if you're in Texas, for instance, a LOT less.


MKYCTR#1523042/18/07; 18:54:16

Yen carry trade residual kicking in. . . .
Henri@ Don Sundeck del Canberra msg 152276#1523052/18/07; 19:02:43

Such a quixotic mix of references but the winds of Australia appear only to drive the wildfires about Sydney not fabricoid rotators of the millstone.

I have fond memories of my visit to OZ panning for gold in the stream that runs through Bendigo and riding the narrow guage rail. Also climbed to the cricket field above the digs and was rewarded by the treble mode song of no less than 3 bushcocks one glimpsed in full tail display while sneaking in from behind a tree of some sort...a gum no doubt. Snapped a photo but the light didn't do him justice...magnificent it was.

I visited the display of gold at the Melbourne museum and was totally blown away by the outstanding goldsmithery applied to a famous horserace of the day when Melbourne was in its heyday. The tales of the dividends paid out to goldmine shareholders of the day floored me...shall we ever reap the whirlwind of the like again? Doubtful.

Viewed the gallery of Parliment from above in your fair city and thought I saw that wild colonial boy skulking off after relieving Judge McElvoy of his gold.

I even stood upon the world famous cricket field at Bundalaguah Wrigglesworth Oval if I'm not mistaken.

But my favorite treat was an Aussie rules football game...go Magpies! I wear my Collingwood jumper while skiing still.

Did I mention that I relieved your home turf of a few ounces of the precious in exchange for some worthless yankee script...I think I hear Kelly, Davis and Fitzroy on my trail

Clink!Stupidity ?#1523062/18/07; 19:10:17

I guess that it is always difficult for someone who has "seen the light" through whatever means (usually serendipity !) to understand how other people cannot see the same thing. But, while I can understand that they have not yet necessarily found the same path to wealth preservation as us, I have difficulty in understanding how someone like Silver Fox's Ed can spend time guiding a significant enterprise can ignore the BIG, FLASHING RED LIGHTS saying UNSUSTAINABLE in most aspects of the U.S.'s financial situation. Trade deficit, government deficit, current account deficit, social security liability, Medicare liability, etc, etc. Is it in the hope that all the bad stuff will magically go away ? I don't think so. I think it is more like the JK Galbraith quote :-

In the choice between changing one's mind and proving there's no need to do so, most people get busy on the proof.

Or in other terms, people spend way too much time tending the trees to see that the forest is dying.


Clink!@ Sierra Madre#1523072/18/07; 19:12:45

Checking in from Floriduh, there seems to be just Sir Slingshot and myself. That's 2 in 15 million !!

GoldiloxGold bid over $670 in HK#1523082/18/07; 19:32:40

On a day when there will be no COMIX trade to haul it back down. Will London carry the PPT ball tonight?
GoldiloxIt's focus, not stupidity#1523092/18/07; 20:28:11

@ Clink,

From TV commercials to early school days, we are exhorted to concentrate our efforts to "be the best at one thing", something which drives some to excel, and others to personal depression. As an amateur musician, I don't know how many others have told me they stopped playing music because they couldn't be the one in a million who "makes it" in a major symphony, Nashville, or LA. What a personal loss. . .

Different drummers, B. Fuller, R. Heinlein, etc, have suggested that "specialization is for insects", reminding us that humans have more than enough ability to succeed in multiple endeavors. Some of the happiest people I know are those who have abandoned 8 years or more of college preparation for some strict discipline and chosen to reroute their life's path to heed another calling. Most have told me it was a difficult, but most rewarding, decision.

I don't think many people venture to explore beyond their personal fiefdom, as that is the social norm. Those who answer the "call of curiosity" also reap the reward of expanded knowledge, but they are fewer than we imagine, as demands on their time and competitive social currents are pitted against them.

I, myself, only found my way here when "forced retirement" dropped the management of my personal finances in my lap unexpectedly. Now that I am again earning a living after four years of "readjustment", I feel the Universe did me a great favor by interrupting my previous path.

mikal(No Subject)#1523102/18/07; 20:34:34

Central Banks Face Rising Pressure From Politicians Exclusive - February 18, 2007
The emphasis here seems to be that independence of CB's from "political pressure" should be maintained, as it has been in some countries, so that we should expect more of them to be fighting inflation by raising rates.

Silver FoxGoldilox #: 152301#1523112/18/07; 20:50:23

Restricted movement…

Pentagon estimates… For sure... However, given the recent run-up in oil prices over the last couple of months, I am not sure the $250 is adequate. But I agree with you, I gathered my information off the media, which is, unfortunately, highly dubious.

Even so, I sadly think there is a high probability of a significant negative impact on the economy is the US attacks Iran. Sure, the US can kick their butts, but winning a battle and ending up in a depression isn't what I can winning the war.


Silver FoxSierra Madre #: 152303#1523122/18/07; 20:59:01

"A lot less".

God… I hate to admit, but I was being generous. The only ones I feel connected with on economics are the ones in this forum, and through my e-mails to the various economic article authors.

Good fortune to you Sierra Madre…


Chris PowellRichard Russell agrees with GATA: Central banks rig gold#1523132/18/07; 21:30:49

11:23p ET Saturday, February 18, 2007

Dear Friend of GATA and Gold:

Nine years after proprietor Bill Murphy, soon to start the Gold Anti-Trust Action Committee, started screaming that the price of gold was being suppressed by collusion on the commodities exchanges, the king of technical analysis of the markets and the most venerable of U.S. financial letter writers, Richard Russell, has fully concurred.

In an unusual weekend letter distributed yesterday, Russell told subscribers to his Dow Theory Letters:

"Let's start with this vital and rather shocking piece of information, courtesy of Stephan Roach, chief economist at Morgan Stanley: 'Net foreign inflows into longer-term U.S. securities fell to just $15.6 billion in December 2006. This is the weakest reading in nearly five years. This stands in sharp contrast to America's enormous external financing needs -- about $3.5 billion of foreign capital inflow each and every business day is required to fund a current account deficit that was running at close to an $875 billion rate in the first three quarters of 2006.'

"What does this mean? It means that the squeeze is beginning.

"Normally, the U.S. reaction to the 'shortfall' would be a recession in order to cut way back on U.S. spending. Or it could be raising rates in order to make it more attractive to accumulate and hold U.S. securities. But raising rates would impact on the fragile U.S. housing situation. If the negative current account deficit trend continues, I don't know how it will be resolved.

"One result should be a weaker dollar and rising gold. If the shortfall continues, we can be sure of one thing -- something has got to give.

"Meanwhile, the central banks of the world are on a tear. I guess you could call it 'deflation-phobia.' At any rate, check out these statistics:

"In Australia, the M-3 money supply is running 13 percent over last year. In the Euro-zone, M-3 is up 9.3 percent. In Britain, M-4 is up 13 percent. In Korea, M-3 up 10.3 percent. In China, M-2 is up a whopping 16 percent. Russia shows M-2 up 45 percent. In the United States M-3 has been reconstructed to show that it's up 10.7 percent. As one wag put it, the central banks have instituted a campaign of 'whip deflation now!'

"I've described the situation previously as 'money gone wild.' It's a blizzard of fiat paper and credit beyond anything ever seen before in world history.

"The mystery is that gold isn't higher, much higher.

"My thinking is that central banks and others have, so far, held gold back with derivatives and massive short sales. I doubt that this can continue."

Yes, Mr. Russell, if gold had held its traditional ratio to money supplies and the prices of commodities, its price would be in the thousands of dollars by now. So much for the last decade of technical analysis of the gold market, which hasn't been able to figure out what has been going on.

No analysis of the gold market is worth anything if it fails to account for both open and surreptitious intervention by the central banks and their agents, the bullion banks, and by the mining company that, in U.S. District Court in New Orleans, claimed immunity to suit by declaring itself the agent of the central banks in the gold market, Barrick Gold.

This intervention has been too much lately even for technical analyst Dennis Gartman of The Gartman Letter, who now acknowledges that a government just might be behind the recent and most blatant efforts to suppress the gold price. Other technical analysts, like Clive Maund, still don't want to hear anything about it and get indigant and unresponsive when challenged. But give them a little more time. They probably will not want to be the last to acknowledge what has become obvious to everyone else, and what, in fact, is already on the public record in a half-dozen places technical analysts never look, since reality would get in the way of their beloved formulas and charts.

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

Chris PowellStephen Roach: Global TIC-tock#1523142/18/07; 22:01:04

By Stephen S. Roach
Friday, February 16, 2007

The US Treasury's latest report on international capital flows came as a shocker. Net foreign inflows into longer-term US securities fell to just $15.6 billion in December 2006 -- the weakest monthly reading in nearly five years. This stands in sharp contrast to America's enormous external financing needs -- about $3.5 billion of foreign capital inflows each business day required to fund a current account deficit that was running at close to an $875 billion annual rate in the first three quarters of 2006. Does an external financing shortfall of this magnitude finally spell trouble for the seemingly Teflon-like US dollar?

Probably not -- or, at least not yet. The monthly Treasury International Capital (TIC) data are not exactly the most reliable piece of intelligence in the US statistical system. The figures are extremely volatile -- expect a big bounce-back next month -- and quite often they do not match up well with capital flow data provided by other nations. In addition, the coverage pertains mainly to foreign investment in longer-term securities -- thereby ignoring the nearly 15% of overseas holdings in instruments with shorter-term (less than one-year) maturities. Moreover, as others have pointed out, the TIC data suffer from major classification biases that often confuse foreign sourcing between official and private investors. (See Martin Feldstein's op-ed in the January 10, 2006, Financial Times, "Why Uncle Sam's bonanza might not be all that it seems.")

Notwithstanding these flaws, the TIC data should not be ignored. Over time the Treasury statistics do a reasonably good job in tracking the international investment transactions embedded in the US balance of payments. As such, TIC reports can be helpful in pinpointing the tensions arising between America's external financing requirements and foreign willingness to provide the requisite capital. And there can be no mistaking a worrisome build-up of tensions on several fronts: First, the United States has made no effort to reduce its chronic saving shortfall.

Reflecting persistent structural government deficits and the first back-to-back years of negative personal saving since the early 1930s, the US net national saving rate has held at a record low of 1% of national income over the past three years. Lacking in domestic saving, America has placed heavy demands on the rest of the world -- absorbing about 70% of global surplus saving over the past couple of years -- to fund its ongoing economic growth.

Second, the rest of the world is waking up to the notion that there are alternatives to low-yielding dollar-denominated assets. That's especially the case in the poor countries of the developing world, who collectively hold over $2.5 trillion in excess foreign exchange reserves -- that is, reserves above and beyond those which would be required to pay off some $550 billion of short-term external indebtedness. A year ago, former US Treasury Secretary Larry Summers gave a speech in India that challenged reserve managers in the developing world to seek higher returns on their increasingly large asset pools in order to help meet urgent social and economic imperatives. (See "Reflections on Global Account Imbalances and Emerging Markets Reserve Accumulation," L. K. Jha Memorial Lecture, Reserve Bank of India, March 24, 2006). The Summers message galvanized attention on this issue -- especially in Asia, where the bulk of excess reserves are held. Talk of portfolio diversification intensified, ultimately culminating in China's recent announcement that it would allocate around $200 billion of its more than $1 trillion in reserves toward the start-up of a Singapore-GIC-style multi-asset fund. With most reserve managers having massive overweights in dollar-denominated assets, such diversification strategies can only complicate America's external financing needs.

Third, Washington continues to flirt with a protectionist response to America's outsize bilateral trade imbalance with China. I spent some time in Washington this week discussing trade issues with congressional leaders, and I came away with the distinct impression that the die is cast for a much more aggressive approach to US-China trade policy. (See my February 13 Special Economic Study, "The Politicization of the US-China Trade Relationship.") Under Democratic leadership, there is a higher probability that ongoing Chinese trade frictions could result in more serious legislative efforts than was the case when the Republicans were in control.

Moreover, with such initiatives enjoying broad-based bi-partisan support, the only real question, in my view, is whether the margin of passage will be large enough to override a likely presidential veto. Should such legislative "remedies" be enacted, I have little doubt that Chinese participation at upcoming Treasury auctions would be sharply reduced -- a hugely negative development for the dollar.

There are, of course, many other considerations weighing on the dollar -- ranging from a likely narrowing of cross-border interest rate spreads and relative equity returns to reserve diversification strategies of Middle East and other Asian reserve managers. At the same time, the three largest surplus savers in the world -- China, Japan, and Germany -- are all hard at work trying to stimulate internal consumption. To the extent those efforts bear fruit -- and, in my view, it's only a matter of when -- they will then draw down their surplus saving and have less excess capital to send America’s way in the form of investments in dollar-denominated assets.

Despite these dollar-bearish conclusions, I stand by my view that a currency realignment should not be viewed as the principal means to rebalance an unbalanced world. (See my February 9 dispatch, "The Currency Foil.") Instead, significant adjustments are needed in the mix of global saving -- more from the US and less from China, Japan, Germany, and the Middle East. A currency realignment is, at best, a circuitous route to such an endgame. At the same time, I still believe that the day is coming when the dollar will be hit by global portfolio adjustments, as foreign investors demand significant financing concessions -- either in the form of a weaker dollar and/or higher longer-term real interest rates -- for their heretofore open-ended buying of dollar-based assets.

A monthly TIC report can hardly be viewed as a decisive verdict on anything. But the December collapse in foreign demand for longer-term US securities also coincided with a sharp widening of the monthly trade deficit to $61 billion -- drawing the narrowing trend of the preceding three months into question. With America's external financing needs remaining huge by any standard, it becomes tougher and tougher for the US to attract the requisite capital inflows under the best of conditions. It may well be that we will look back on the December 2006 TIC report as a warning shot of what was to come -- an increasingly difficult external financing climate for a saving-short US economy. The clock is tic(k)ing.


Stephen Roach is managing director and chief economist for MorganStanley.

Clink!@ Goldilox#1523152/18/07; 22:07:57

Focus - very true. I myself only got the first glimmerings at 40ish because of a finance course I took in about 2000 - at the time the datacommunications equipment company I worked for was becoming a dot.bomb. Thoughts that I hadn't had even in my first trip through tertiary education were forced to the surface. My entry to the "Real World" wasn't as rude as yours - I jumped before I was pushed - but I still have a few scars. Like 20+ years of capital loss allowance for my taxes !!

@ Silver Fox
I'm really not sure that, despite all the planning, there is a real idea in Washington about the consequences of their actions. Either that or their motivation is personal. George Ure made an interesting point last week by taking news headlines and substituting percentage of world oil reserves for the name of the country involved. It would be interesting to do the same not for in-ground reserves but current supply. There are so many possible knock-on effects from an attack on Iran. What happens when it is discovered that Chavez has agreed to shut down Venezuelan supply to the US (10% of supply) in the eventuality of an attack ? What happens if, in response to the destruction of Russian interests, they decide to cut off Europe's natural gas supply ? Or Nigeria's nationalists shut down their 3% of world supply ? I'm not sure if now is the time, but one day the second and third world countries with resources are going to say "enough" to dollarization.

melda laureEh? Iran-redux.#1523162/18/07; 23:28:35

I sometimes wonder if we have not misinterpreted the current situation completely backwards....

SNIP: The point was not that the US dollar became a "petro" currency. The point was that the reserve status of the dollar, now a paper currency, was bolstered by the 400% increase in world demand for dollars to buy oil. But that was only a part of the dollar story.

What is the whole story? The dollar, oil, gold are but a part...

GoldiloxGeopolitical or financial#1523172/18/07; 23:38:59


It appears that the worst threats to the already shaky IMS this "year of the pig" may belong to Dubya and his western Oil-Czar coalition attempting to "rally" the political capital that he boasted about after his re-election. Bank and brokerage failures are much more easily "papered over" than Pyrrhic "military victories".

As the US monetary-military machine seeks continued access to the fuel needed to maintain its hegemony, it is finding that "paying the piper" is getting more expensive daily.

The anti-Bush forces would like nothing better than to "cut them off", but let us hope cooler heads prevail. One Pearl Harbor event against an oil power is enough, especially since it appears to have already back-fired.

melda laureRock, Paper, Scissors#1523182/18/07; 23:45:05

In extremis, I have suggested that a first world "recession"... a.k.a. "war on the middle class oil consumer" would be a temporary solution to the "energy crisis" (real or contrived).

It was creepy to hear Mr Ure suggest the same.

The question is, do TPTB have a sufficient grip on the derivatives mess (I think the answer is yes) to prevent it from preempting their plans?

Mr Engdahl seems to have a bigger nightmare in mind than even the mind of Mr. Nyquist could devise. I of course have no opinion on this- my only interest is in the countdown to free gold, which looks like it may be upstaged by more distractions.

SNIP:Ironically, oil, in the context of Washington's Iraq war and soaring world oil prices after 2003, has enabled Russia to begin the arduous job of rebuilding its collapsed economy and its military capacities. Putin's Russia is no longer a begger-thy-neighbor former Superpower. It's using its oil weapon and rebuilding its nuclear ones.

Bush's America is a hollowed-out debt-ridden economy engaged on using its last card, its vast military power to prop up the dollar and its role as world sole Superpower.

When he took office, the president already had a lousy hand of cards, (regardless of how they have been played since).

Between ore-throwing Resource Farmers, Paper tossing banksterism, and scissors-weilding militarists, it is a bit more complicated than just a uni-polar model.

That's just a guess: it's hard to play rock paper scissors in the dark.

melda laureRolling the 3-sided dice.#1523192/18/07; 23:57:23

"...ending up in a depression isn't what I [call] winning..."

I have been fairly convinced that denying ME oil to the "Rest of World" is an aspect of the definition. But I am open to other ideas, a good definition would go a long way to predicting the strategy model space.

Full spectrum dominance is not about mere weapons. Clearly rocks and paper are just as important as the scissors.

Gandalf the WhiteTAA TAA TAAAAAAAAAAAAAAAAAAAAA TAA TAA! #1523202/19/07; 00:01:47

$$$$$$$$$$$$$$ A "PRICE of GOLD" (POG) GUESSING CONTEST!! $$$$$$$$$$$$

We shall have a price guessing contest on the closing (Settlement price) of gold for the April COMEX Contract (GCJ07) on the last day of this month. Wednesday, February 28, 2007, ---BUT all entries must be posted to the TableRound before Midnight on Saturday, February 24th, AND ALL ENTRIES must answer "THE QUESTION" !!

Based on numerous prognostications from both recognized metals industrial companies executives, financial "experts", taxi drivers, "politicians" and "OTHERS" – that the price of gold this year will be somewhere between $500 and $2,000, the QUESTION is:

What do you think the highest price of gold (POG) will be this year, AND, in thirty words or more, Why????

This POG Contest winner -- the closest price guess to the actual Settlement Price -- will receive a rather rare collectors piece, a Danish 20 Kroner goldpiece, having the likeness of King Christian IX on the obverse, but commonly known as a "Mermaid" for the content of the reverse side of the coin !

The "Mermaid" 20 Kronor goldpiece had a total mintage of only 1.5 million, as compared to the nearly 110 million mintage of its period cousin, the English Queen Victoria sovereigns. It gets its name from the blend of a stoic Lady Liberty, enthroned with what I think is a porpoise or dolphin, swimming at her feet. Christian IX, pictured on the obverse of the coin, was known as the 'father-in-law' of Europe because two of his daughters and one son married into the royal lines of England, Russia and Greece respectively, and his grandson became the King of Norway. This coin is exceedingly popular with the people of Denmark in that the "Mermaid" is the national symbol of the country. These beautiful gold pieces were minted between the years of 1873 and 1900, have a Fineness of 0.900, and Actual Gold Content of 0.2592 troy ounce. This prize coin was minted in the first year of production, 1873 !

There will be also be two runners-up prizes for the next closest prognostications --- each winning an one ounce pure Silver U.S. Eagle.


1) The Winner is the poster with the Price Guess closest to the Settlement price of the COMEX (most active) April 2007 Gold Contract (GCJ07) on the date of Wednesday, February 28, 2007.

2) Price "Guesses" shall be stated in Dollars and tenths !
(Such as $666.6)

3) "Guesses" shall be SHOWN in the SUBJECT BOX location AND enclosed in markers of "Dollar Signs" so as to be OFFICIAL !
(Such as $$$$$ $666.6 $$$$$$$ )

4) ONLY one "Guess" per Knight or Lady is allowed, and once that "Guess" has been "taken" -- no one can duplicate it !! FIRST COME has rights to that "Guess".

5) HOWEVER, All "Guesses" MUST be posted before the clock in Denver strikes MIDNIGHT (24:00) on Saturday, February 24, 2007.

6) AND MOST IMPORTANTLY (as this part MUST accompany the Price prognostication) --- In order for your entry to be valid, entries will need to have a full answer to the QUESTION, in 30 words, OR MORE. <===== NOTE !!!
LET the CONTEST continue !!


$$$$$$$$$$$$$$ THE FEBRUARY 2007 "PRICE of GOLD" GUESSING CONTEST!! $$$$$$$$$$$$


Entries as of DAY #5 -- (2/19/07) at just about 00:01 Denver time !!!

Listed in order of decreasing values !

$$$$ $775.5 $$$$ Sprout (2/16/07; 18:42:09MT - msg#: 152256)

**** $727.5 **** Thoreauly (2/17/07; 07:46:31MT - msg#: 152267)

$$$$ $724.6 $$$$ Topaz (2/15/07; 04:55:38MT - msg#: 152177)

$$$$ $695.0 $$$$ Sundeck (2/16/07; 04:38:24MT - msg#: 152221)

$$$$ $688.0 $$$$ Goldilox (2/16/07; 11:26:32MT - msg#: 152238)

$$$$ $687.8 $$$$ Lebieque (2/15/07; 03:55:18MT - msg#: 152174)

$$$$ $685.0 $$$$ Toolie (2/15/07; 03:10:40MT - msg#: 152170)

$$$$ $684.8 $$$$ Freedom (2/18/07; 13:37:59MT - msg#: 152295)

**** $678.0 **** Rook (2/17/07; 19:55:35MT - msg#: 152278)

$$$$ $673.5 $$$$ Lothar of the Hill People (2/17/07; 13:25:18MT - msg#: 152271)

**** $670.0 **** Liberty Head (2/17/07; 10:03:22MT - msg#: 152270)

$$$$ $666.6 $$$$ Minero (2/17/07; 07:39:45MT - msg#: 152266)

$$$$ $662.5 $$$$ Henri (2/16/07; 11:02:33MT - msg#: 152235)

$$$$ $658.0 $$$$ flow5 (2/15/07; 12:19:26MT - msg#: 152184)


melda laureDid I hear you say the US gone "off the reservation"#1523222/19/07; 00:07:06

@ mssg 152317.

(And I meant not only in regards to the scissors, but the rocks and especially paper as well...)

Which weapon will be drawn first? (Or perhaps einstein's quaternionic vision for WWiii will be realized.)

USAGOLD / Centennial Precious Metals, Inc.The PRIZE !#1523232/19/07; 00:27:53">gold Mermaid contest prize
TownCrierHEADLINE: Brown ‘lost £2bn in gold sell-off’#1523242/19/07; 00:57:16

February 18, 2007 -- Gordon Brown may have missed out on a £2.6billion Treasury windfall, it was claimed.

Between 1999-2002, the Chancellor sold more than half of Britain's gold reserves in auctions which raked in £1.8billion.

But with gold prices now at near-record levels, he could have raised £4.4billion had he sold the gold now.

Tories accused Mr Brown of making a 'catastrophic mistake'.

Shadow Treasury Minister Mark Francois said last night: 'This is one of the many decisions by Mr Brown that have cost the country dear.'

And Julia Goldsworthy, the Liberal Democrat Treasury spokeswoman, said the gold issue had tarnished the Chancellor's reputation.

She added: 'He sold off reserves for the sake of supporting short-term spending 'The fact that the gold price has risen so much since then underlines what a mistake it was.'

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

They're still keeping score on this one, and the monetary size of the number just keeps growing as time marches on...


TownCrierGold Rises to Seven-Month High as Dollar Declines Versus Yen#1523252/19/07; 01:31:02

Feb. 19 (Bloomberg) -- Gold in Asia rose to a seven-month high as a decline in the dollar against the yen boosted the appeal of the precious metal as an alternative investment.

The yen traded near a six-week high against the dollar on speculation the Bank of Japan may raise interest rates this week. Gold has risen five percent this year as a weakening dollar encouraged investors to build their bullion holdings.

``I am still quite bullish, managing director of Sydney- based Commodity Broking Services, Jonathan Barratt, said today by phone from Sydney. ``The market is behaving in a very solid way and every dip seems to bounce.''

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

In a world of so many dollars, any serious flight away will result in a sort of naturally leveraged gains among the limited alternatives such as physical gold.


KnallgoldWe are making progress#1523262/19/07; 01:49:59

Last Thursday,my former boss made a remark on our lunch that he considers buying Gold!I was quite surprised and asked for what motivation-he replied that he's reading a book ("Der Crash kommt" by Max Otte) and that he is starting to worry that this one won't end good.I also noticed a silent admiration on my decisions regarding Gold,particularly on the buying at the bottom.Mom btw said the same yesterday and complained about the banks'she though learned the lesson and was a buyer a few weeks ago.

Finally,it starts to pay off making an a** of me for being a Goldbug all the years.Certainly the ridicule is over.

On the same day(!),on N-TV (the german equivalent to CNBC) they recommended buying physical Gold as part of the portfolio!Of course with all the cautionary blablah,but I got a sense of "the plot thickens" and that they had the urge to cover that base.And more on a funny note,yesterday they brought Goldfinger on a german channel.The simultaneousness is quite remarkable...

Earlier,when someone queried me about Gold,it happend seldom and very isolated.About 1.5 years ago,on a dinner with many ex-colleagues,one approached me "I remember you very clearly Mr. X,when you came into the elevator and said loud and clear, "now is time to buy Gold!!",that was a good decision!Did you sell already?".Of course they always asked if I sold and if its not too late to enter.I always responded that I'm still a buyer and for what reasons.

If you're right a second time (Another leg up after the bull was "over"),these people actually DO consider buying Gold for themselves,first time it was more like "the guy was lucky,the nut was right one time but he should have sold now"-back to daily routine).

We're on the march fellow Goldmeisters!

TownCrierRoyalty bill will hobble SA mining#1523272/19/07; 01:55:38

February 19, 2007; Johannesburg -- The second draft of the Mineral and Petroleum Resources Royalty Bill, which proposes charging royalties on mining revenue, would damage growth, investment and empowerment in the sector, the Chamber of Mines said on Friday.
The chamber also called for royalty receipts to be used for specific purposes, such as infrastructure development in communities around mines and for areas that provide labour.

The bill proposes that royalties should be placed in the general treasury fiscal pool.

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

In-the-ground resources shall continue to be sitting ducks... easily plucked.


mikalTermites may help build energy security#1523282/19/07; 02:04:02 How biology will help fill your fuel tank by Alan Boyle - Innovation - - Feb 18
TownCrierNew Year of the Golden Pig brings gold reserves, increased output to China#1523292/19/07; 02:12:21

18-FEB-07; RENO, NV ( --As China rang in the New Year at midnight Sunday, the nation's National Development and Reform Commission said that China's gold mine reserves increased to more than 650 tonnes in 2006.

The New Year's celebration brought the year of the Golden Pig, which occurs only once every 60 years in the Chinese lunar calendar. Children born when the gold and pig years coincide are suppose to have a fat and easy life. Hopefully, it will also boost gold consumption among the Chinese this year.

China plans to increase production to 260 tonnes of gold in 2007, almost 20 tonnes higher than last year...

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

A fat and easy life -- NOT a skinny paper-chasing frenetic life.


TownCrierZimbabwe: Gold Miners Call for Price Review#1523302/19/07; 02:25:33

(The Herald) February 19, 2007 -- Gold miners have called for a price review of the yellow metal as as a prerequisite for an improvement in output.

The miners believe the current producer price of $16,000 per gram is not only uneconomically viable, but out of step with the prevailing high production costs. A 500 percent increase from the current price would be ideal, they have proposed.

"We believe that a producer price of between $80,000 and $100,000 would enable us (miners) to carry out our mining activities profitably," said Zimbabwe Miners Federation chief executive Mr Wellington Takavarasha.

The Ministry of Mines and Mining Development and the Ministry of Environment and Tourism had already agreed to hold consultations with all relevant stakeholders in order to come up with a new pricing formula that restores viability to the gold sector.

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

As previously stated, under almost any conceivable scenario as an investor you want your portable share of the finished product, not shares of soon-to-be 'finished' producers.


USAGOLD / Centennial Precious Metals, Inc.Inflation-adjusted retrospection gives a hint at gold's price potential...#1523312/19/07; 02:26:49">gold price potential
GoldiloxBritish Gold#1523322/19/07; 03:36:59

I wonder how much British gold Gordie is dumping tonight to stop the swell that begin in Hong Kong?
GoldiloxInflation adjusted price chart#1523332/19/07; 03:41:52

@ TC,

One might also consider the amount of inflation stolen from the dollar from 1913 to 1970, as the FIAT swindle has been in full force since the establishment of the FED!

slingshotGold bugs in Florida#1523342/19/07; 07:10:02

Sir Clink is right. Only two left here in the state.
There was three one time but he started reading about Global Warming and moved to the mountains looking for Mogambo.
Or something like that.

GoldiloxTwo left#1523352/19/07; 07:46:59

@ Slingshot,

I think Mogambo is still hunkered down in Clearwater, or thereabouts.

Something about his P.O. refusing him a travel pass . . .

HenriOK more time#1523362/19/07; 07:47:43

What the Federal Reserve created in 1913 is NOT a US dollar which is defined as 1/20 of one troy ounce of gold (or something very close to this). So to speak of these Federal Reserve Notes (FRN's) as though they were in fact US Dollars is or at least on this site should be borderline heresy.

What the team of the US govt, the Federal Reserve Banking system and the US treasury have eroded to about 3% of its former purchasing power is the FRN plain and simple. To speak of or express the POG as the FRN cost of gold (regardless of its "legal tender" status)is to perpetuate the lies and the fraud conceived on Jekyll Island for the benefit of the bankers. The constitutional US dollar is and will remain 1/20 of a troy ounce of gold until such time as congress decides that is no longer the law of the land and specifically replaces it by constitutional amendment.

If the remaining 8000 tonnes of gold owned by the people of the US is still intact (Big if), then the US is well poised to create the next generation fiat game be it an "Amero", the "Northamero", or a strictly US based concoction. If the US does not retain title to this stash of gold, then it has no legs to stand on. So let us rename the chart as the "FRN cost of gold".

For this next genration of fiat, all of the citizens of the US and all those who will come seeking opportunity will not be fooled into believing that it (whatever they name it) is actual money. It will clearly be only poker chips that remain to be cashed in through an open market transaction into freegold to be held as savings of last resort. If it takes 10,000 its to buy a chunk of gold then so be it, the trick is not to become confused and hold the "its" long enough for them to lose purchasing power in your hand, they are for recycling into the economy at high velocity so that no one user is exposed to the ravages of their inherent inflationary nature. This is the nature of the FRN and all other forms of government script.

For what it is worth, a US dollar is still 1/20th of a troy ounce of gold.

HenriThe correct answer#1523372/19/07; 07:52:31

OK so clearly the correct answer to the contest question is "twenty US dollars"
slingshotKnallgold#1523382/19/07; 07:55:18

They will remember your mention of gold to them.I also felt bad about making an idiot of myself. No More.
You give these people opportunity to examine the facts and decide whether they will preserve their wealth.
While you did seem to be an idiot, your friends do not realise you wanted them to look at something that may change their whole life.
Job Well Done, Knallgold

geV. Putin & the Geopolitics of the New Cold War:#1523392/19/07; 08:19:14

Or, what happens when Cowboys don't shoot straight
like they used to...
by F. William Engdahl

ThoreaulyDeficits don't matter at the Mises Institute#1523402/19/07; 08:21:09

Hard to believe that LvMI has recently published two articles (above and below) by "Austrian" economist Robert Murphy defending the US's massive and growing current account deficit. Is Greenspan the new editor?

mikal@TownCrier#1523412/19/07; 08:52:17,20867,21254165-643,00.html Study blames mining for economic slowdown by David Uren -
Business | The Australian | February 20, 2007
Short article with a shallow premise starts out with: "The mining industry may be to blame for the slowdown in the economy, even though employment in the sector is booming."
- and ends by blaming factors such as flawed productivity stats, vagaries in oil and coal industries, production delays etc.
Some recent news press may have some mining execs feel like someone wants them between a nugget and a hard place!

HuskyV. Putin & the Geopolitics of the New Cold War#1523422/19/07; 09:15:51

Engdahl's piece is a puff piece for current anti-war sentiment, which is just to say that the piece doesn't venture beyond the realm of the superficially obvious.

What he is missing is rather important though. It's not really about WWIII, but rather WWIV. Defence planning entails more than short-term thinking. Nowhere does he mention why the US should possibly consider the Russians a strategic threat in the distant future, but rather the article just presumes the moves are all simply idiotic and megalomaniac - which I do not believe they are on all levels.

GoldiloxUAE gold sales up 53 per cent in Q4#1523432/19/07; 13:09:30


DUBAI — The retail gold sales in UAE increased by 53 per cent during fourth quarter of 2006 as compared to the same period in 2005.

According to World Gold Council's regional office in Dubai, sales figures in Gulf state increased from Dh1.1 billion to Dh1.7 billion in the fourth quarter of last year.

However, the UAE gold consumption in terms of tonnage increased from 17.6 tonnes in Q4 of 2005 to 19.1 tonnes in the same period of 2006. This increase in gold sales and tonnage is due to the high number of tourists in the UAE during that period, in addition to all the holidays during that time like Eid, Christmas, Diwali and New Year.


Like the Chinese and Indians, others are "getting it".

mikalLaw, advisory and consulting firms prepare for failures of credit, "business cycle"#1523442/19/07; 13:20:39,0,586082.story?coll=chi-business-hed

Lawyers ready for a boom in bankruptcy
Experts in field believe business cycle will soon yield a surge in defaults
By Ameet Sachdev - Chicago Tribune staff reporter
Published February 18, 2007 - Excerpts:
"In anticipation of the next wave of corporate restructurings, the association held its first-ever "Distressed Investing" conference last month in Las Vegas. The meeting, which brought together turnaround experts with financial dealmakers who buy securities in troubled companies, had everyone asking the same question that some outside the industry might consider grim: When is the bubble going to burst?

...If defaults do rise, bankruptcy professionals expect to be very busy. The issuance of U.S. junk bonds, or high-yield corporate debt, has topped $100 billion in three of the last four years, levels not seen since the late 1990s.
Companies have rushed to the bond market to refinance. Buyout funds also are taking advantage of low borrowing rates to raise money for takeovers. About 40 percent of the junk bonds issued since 2004 are rated B- or below and have higher chances of default, Vazza said.
"All the available liquidity is papering over a lot of problems right now," Marwil said.
With companies leveraged to the max, there is little margin for error. Any blip--from a sharp rise in commodity prices to another terrorist attack in the U.S.--could lead to a crisis."
Mikal --- Artificially low rates and easy terms
have aided the bubbles and massive liquidity injections assuring everyone that financial firms and banks would
regulate themselves and the government's hand was always 'benign'. No business cycles, this time is different, the economy is just right!

mikal@Henri#1523452/19/07; 13:52:39

Re: Your inflation adjusted, real-world modified, turbocharged, high perfomance gold:
"So let us rename the chart as the "FRN cost of gold".
For this next genration of fiat, all of the citizens of the US and all those who will come seeking opportunity will not be fooled into believing that it (whatever they name it) is actual money. It will clearly be only poker chips that remain to be cashed in through an open market transaction into freegold to be held as savings of last resort. If it takes 10,000 its to buy a chunk of gold then so be it, the trick is not to become confused and hold the "its" long enough for them to lose purchasing power in your hand, they are for recycling into the economy at high velocity so that no one user is exposed to the ravages of their inherent inflationary nature. This is the nature of the FRN and all other forms of government script."
Ditto. And briefly, what else do "they call it"?
The new 'presidential dollars'. (You can order these
classics from the mint at face plus a larcenous commission!)
'Drafts'(A cold draft of air or an armed forces callup/conscription to serve).
'Bills'(What you get in the mail saying '$$'s due by...').
'Orders'(What the deciders decide for us).
I think I'll prefer 'Notes'(Chance scriblings of a random, unofficial nature)thank you, and take your advice and exchange them for 'coin of the realm'!

Chris PowellJames Turk offers evidence the World Gold Council missed#1523462/19/07; 14:37:10

4:25p Monday, February 19, 2007

Dear Friend of GATA and Gold:

In an interview with the Financial Times on January 15, James Burton, chief executive officer of the World Gold Council, remarked that he had "seen no evidence" that central banks were working together to suppress the price of gold. This is understandable enough, given that the head of the gold council must spend most of his time draping exquisite jewelry on fashion models at advertising shoots.

That HAS got to be a lot more fun than reading, for example, congressional testimony and the derivatives reports of the Bank for International Settlements, which is how GoldMoney founder and Freemarket Gold & Money Report editor James Turk, consultant to GATA, spends most of HIS time. So Turk has tried to help Burton and FT readers with an open letter of reply to the FT's interview, along with a little commentary, which you can find at GoldSeek here:

The World Gold Council has an annual budget of more than $60 million. For not even half that much GATA would be happy to tell women not only that the gold market is rigged but also that they shouldn't wear pearls with plaid.

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

melda laureThe dollar FRN has no gold price, it is a pure derivative that can only be measured against the ounce#1523482/19/07; 17:43:09

@ mssg 3152337.

Then by that verbiage, a FRN is worth about $20/$672 or 1/33 dollars. Perhaps we should call it a Federal Reserve Unit? In that case a dollar ($20.67 per troy ounce) is now exchanged for about 33 FRU's.

The 33:1 "price" is not a price at all, but a dimensionless quantity of "dollars/dollar" by which the current proxy has lost value compared to the original real quantity.

To be realistic, we should express this as an interest rate on physical gold, or better yet as a negative gold interest rate charge on holding FRN dollars.

Though I rather suspect that's like asking how much energy is in one volt, or how much money is in a 1% interest rate since the OUNCE is a mass quantity, whereas the paperized FRU is a mass*f(t) unit which looses value according to the actual function f(t) which is in units of time/mass. In any REAL transaction gold is exchanged for dollars and the dollars are exchanged for other goods. Thus the f(t) function is nulled out ASSUMING that t1 and t2 are more or less simultaneous.

Thus the typical barter equation of Eggses per loaf of bread is NOT like a dollar equation. The construct of eggses per dollar is something more like an insurance transaction: one buys the insurance policy with eggses in the expectation that it will be fully exchangeable at par on the other side of the transaction: an increasingly dubious expectation.

melda laureMegalomania Puff Piece.#1523492/19/07; 18:06:59,6903,421888,00.html

I would agree with that (even if it is old news)

What IS the plan for ww4 and ww5? Will advanced electromagnetism have a role? His comments about Mr Yamani's assertions about an enginneered oil price rise in the 1970's are intriguing, though it is obvious that rather than being wholly voluntary the rise was killing two birds with one stone. And what does Mr Yamani think is going to replace oil? Perhaps the former minister has taken one aromatic-hydrocarbon whiff too many?

The war on gold is not just about paper. Or even oil.

'King Faisal sent me to the Shah of Iran, who said: "Why are you against the increase in the price of oil? That is what they [the americans] want? Ask Henry Kissinger - he is the one who wants a higher price".' ...

...Last year Yamani said that the oil prices were destined to crash in the long term and, the world would never use up the last drop of oil, because it would not need to: 'The Stone Age did not come to an end because we had a lack of stones, and the oil age will not come to an end because we have a lack of oil.'

If the UAE as an increasing golden appetite it is hardly surprising.

Chris PowellInvest with Barclays and watch it sell you short#1523502/19/07; 18:11:54

Barclays Puts
ETF Portfolios
To Good Use

Securities Lending Helps
Juice Returns, Revenue;
Potential for Conflicts

By Tom Lauricella
The Wall Street Journal
Friday, February 16, 2007

Barclays Global Investors has become a dominant force in the business of running exchange-traded funds, partly on the appeal of the low fees it charges investors on these mutual-fund-like products.

Another aspect of its business that is less well-known to ETF investors: Barclays actively engages in securities lending -- loaning out the stocks and bonds in its iShares ETF portfolios. The loans are highly lucrative, bringing in millions of dollars a year for Barclays in addition to the fees it gets for managing the funds.

Securities lending isn't new, but it is growing increasingly common in the fund industry. Such lending has particular appeal for ETF providers. The profits can boost an ETF's returns -- and in the world of index funds such as these, a small amount of additional income can make performance appear significantly better.

Demand for borrowed securities has skyrocketed thanks to the growth of hedge funds employing a "short-selling" strategy. In this strategy, investors bet that prices will fall by selling borrowed shares in hopes of replacing them with cheaper ones bought later, and pocketing the difference.

The Securities and Exchange Commission has ramped up its scrutiny of securities lending in general but especially in cases where an arm of the fund-management company also gets paid for helping broker the lending arrangements. There is potential for conflicts arising from the fact that the interests of the fund-management company arm don't always align with the interests of investors. It is in the fund company's interest to take as big a cut as possible from the lending profits, while it is in the interest of shareholders for the opposite to happen.

At Barclays, a unit of British bank Barclays PLC, the loans boost its profit from some of the index-tracking funds by double-digit percentages, typically 10% or so. But in a few cases, the gains are significantly higher -- at its Russell 2000 fund, for instance, securities lending effectively boosted Barclays' revenues from the fund by 50%.

Meanwhile, for ETF investors, the income that iShares funds receive from lending generally increases returns by 0.01% to 0.15%, according to Barclays.

Barclays says it runs its program in the interest of fund shareholders and complied fully with SEC rules when setting up its securities-lending process. It splits proceeds 50-50 between the fund-management company and its iShares ETFs.

The fees Barclays receives "are fair and reasonable," and the agreement benefits shareholders by providing additional income, says James Parsons, a managing director at Barclays.

Barclays isn't the only firm that gets paid for helping its own funds lend out securities: Goldman Sachs Group Inc. and J.P. Morgan Chase & Co. are two other examples. But in relative terms, Barclays gets a bigger boost in revenue from lending than managers of actively managed funds (as opposed to index-tracking funds like ETFs) given that actively managed funds charge higher advisory fees.

Here's how securities lending works: A fund loans out some of the stocks or bonds it holds in exchange for collateral, usually cash. That money is reinvested into a low-risk investment to provide additional returns for the fund.

The lending is typically done through an agent whose job is to find customers needing to borrow. The agent takes a cut of the money earned from the loan. The share kept by agents varies, ranging from 10% to 50%. Many funds use an outside company as an agent rather than an affiliate of the management company.

Among major ETF providers, State Street Global Advisers, like Barclays, is a big player in both the ETF and securities-lending businesses. State Street currently contracts with an outside agent and doesn't get paid to help its funds with securities lending. Mutual-fund giant Vanguard Group also lends securities, using an in-house broker, but says that all the income goes directly back to the funds.

Such arrangements with in-house lending agents have drawn the scrutiny of the SEC. An examination of mutual-fund practices found instances where fund companies may have improperly tilted the bidding process toward in-house lending agents when fund boards were looking to contract out the business.

ETFs have attributes that make them particularly attractive for securities lending. Based on indexes, they hold a wide range of stocks, and the portfolio composition is fairly predictable.

And as ETFs have become more narrowly focused -- some newer ones target tiny corners of the market, such as biotech stocks -- there's a chance that an ETF company will hold stocks sought by borrowers. Typically, international and smaller-company stocks are the hardest to borrow, and thus the most valuable for a lending agreement.

Barclays, which is among the biggest players in securities lending, has been the lending agent for iShares funds since 2003. The staff of the SEC requires that when a fund board considers an affiliate of the management company as an agent, it must comply with several specific requirements, including that fees charged are "fair and reasonable" when compared with outside vendors. Barclays says that its funds followed that process required by the SEC.

In its role as lending agent, Barclays collected $1.5 million in fees on the iShares Nasdaq Biotechnology fund for the year ending March 2006, amounting to an additional 19% above its basic fee for managing the fund (which totals 0.5% of assets). It is a similar story for its Standard & Poor's SmallCap 600 fund, where $1.6 million in lending fees added up to an additional 20% above the management fee.

Barclays also profits off of securities lending on its bond funds. For its five funds based on indexes from Lehman Brothers Holdings Inc., Barclays received $4.4 million in lending fees, equaling a 23% boost above the $18.9 million in advisory fees it earned.

For shareholders, the magnitude of the income boost is much smaller. In the Russell 2000 fund, the bump up in income for 2006 amounted 0.083%, Barclays says.

However, the firm says that additional yield should be compared with the earnings that other fund companies generate for their portfolios through securities lending. In 2005, Barclays says, its securities lending program helped the company's ETFs exceed yields on comparable funds by 16% to 357%. For example, Barclays says that on Russell 2000 index funds offered by other companies, the nearest competitor only earned half as much on securities lending as the iShares fund.

TownCrierChris P, thanks for sharing the ETF article#1523512/19/07; 19:31:05

I've happily tacked that piece onto the bottom of a webpage which provides some related dialog had on the subject of lending and shortselling ETF shares exactly 6 months ago here at the forum. (see url)

Now, maybe with the mightly WSJ behind my words, some previously skeptical people might no longer think I'm cracked as they currently do...


Of course, the risk is now that some others will begin to believe me to be a frontrunning agent of the mainstream...


Chris PowellBarclays and the rest#1523522/19/07; 21:12:06

Randy, as you and others here have suggested
over the years, everything the financial
establishment does in regard to the precious
metals is designed to divert demand from the
real thing, which is finite and which they
can't quite control, and into paper, which
is infinite and entirely their creature.
Barclays is very much part of that. To
trust them is to be taken.

TownCrierThat's pretty much it in a nutshell.#1523532/19/07; 21:32:22

In the quest for physical gold, many doorways to dead ends are fabricated along the way by those who would prefer to have the control retained by themselves alone.


GoldiloxThe end of the oil age#1523542/19/07; 22:04:49

@ Melda Laure,

Yamani's quote, "The Stone Age did not come to an end because we had a lack of stones, and the oil age will not come to an end because we have a lack of oil.'

is actually a very interesting observation.

Nor was the end of the "horse age" precipitated by a lack of horses, or the end of "gold as money" precipitated by lack of gold. More likely, the end of "gold as money" was precipitated by too much "demand" in the "money for commodity" flows.

With demand for gold rising, it's not surprising to see gold derivatives popping up like mushrooms in a forest. Modern "capitalism" has long ago passed from the simple supplier-customer relationship to "require" middlemen and derivative gamblers as a much bigger game than the root transaction itself. Today "productivity" is measured by how many permutations of the original deal exist to add price layers.

That's one of the unsung "beauties" of globalism. Tennis shoes from China that cost pennies to make still cost western consumers tens and hundreds of dollars, as they support an incredibly large infrastructure of finance, marketing, and logistics.

TopazAlt-Gold.#1523552/19/07; 22:26:13

With both Bond and Dollar softer in the early going you'd expect $PoG to be running a bit here, we'll see as the night/day wears on.
Those softest of softies Yen and $Can both turned turtle yesterday and we see $CPoG in sight of it's multi-year high, with YenPoG looking to bury last weeks efforts.
With the 22nd Silver Options Expiry ...I can wait 'till then!
Speaking of Turtles and Gold, what is Vince thinking firing Ari??

Flatliner@Chris Powell's ETFs#1523562/19/07; 22:40:22

Time is a gold advocate's best friend. We learned many months ago that ETFs are just another way for gold to be fractionalized into the markets. The article that you post today, adds to that understanding and applies strength to the stand that as long as people are willing to not actually buy gold, we will not truly know the real price of gold.

Gold is a beautiful means for preserving your own wealth. Knowledge will help you hang onto your gold.

Save your life, so you can enjoy your life savings and help someone else save theirs by teaching them that when they buy ETFs, they have no claim to the actual metal (in many cases, there is no metal for them to claim).

mikalToo much risk taking#1523572/19/07; 23:29:54;jsessionid=JLBMWAFZMLEF5QFIQMFCFFWAVCBQYIV0?xml=/money/2007/02/20/cnspend20.xml

Reckless Spending: Will It All Go Pop? | Edmund Conway, Economics Editor | Business | Money | Telegraph
Focusing on the latest reading of Dresdner Kleinwort's
Greed and Fear Index to insist that, yes, it's going to pop

mikal(No Subject)#1523582/20/07; 00:02:24 Investment column: Another bandwagon about to disappear over the horizon | Tom Stevenson | Money | Telegraph | Feb 20, 07
Mostly familiar arguments that the global private equity/buyout funds binge has had 15 years to strip assets and abuse the tax system, garner obscene profits for managament using debt and leverage, and become so large that they've sucked dry investment opportunities for the future

mikal(No Subject)#1523592/20/07; 01:08:02

Treasuries Lose 'Masters of Universe' as Volatility Dwindles by Elizabeth Stanton | Bloomberg | 02/19/07
Primary dealer's (see Chart) ranks are thinning. Some firms are changing hands and leaving the business. Underwriting of US Treasury Securities is less lucrative as daily point spreads shrink...

mikal(No Subject)#1523602/20/07; 01:18:54 Can Our Economy Survive a Growing Political Divide? - Michael Panzner - SeekingAlpha
GoldiloxSeeking Alpha - Panzner#1523612/20/07; 06:35:18


What a bait and switch headline. While the issues are very real, almost nothing was said in the article about how he expected this to affect the economy.

GoldiloxGlobalization - the Car industry#1523622/20/07; 07:39:15


ifty years ago the Big 3 US carmakers (GM, Ford, Chrysler) dominated the industry, both in the US and worldwide.

GM alone produced half the cars made in the US, and employed 500,00 workers. Its only worry was that it was so powerful it would be broken up by the US government on anti-trust grounds.

But from the 1980s, their market share has plummeted, hit by the oil crisis and the rise of Japanese imports.

Now their share of their home market in the US has declined dramatically as new, leaner producers like Toyota have entered the market, producing more environmentally friendly and reliable cars.

GM and Ford are cutting thousands of jobs and closing plants, while Toyota is building one new plant each year.

As GM and Ford has racked up huge losses in the past few years, their financial ratings have shrunk. Toyota is now worth 10 times as much as GM on the stock market.

Now Toyota is set to overtake GM as the world's largest carmaker, ending 70 years of dominance.


And that's even after taking into consideration that 90% of GM's business is now "financial".

Silver FoxPOG & POS#1523632/20/07; 07:48:34

Looks like the Central Banks are making a full fledged effort to shore up the dollar,... again. I wonder how low the POG & POS will go.

I just might have to go and buy some more...


GoldiloxBuyers come out again ar $662#1523642/20/07; 07:54:37

The latest short sale has been reversed again at $662. There are some very committed buyers at that price.
slingshot"Time Monks"#1523652/20/07; 08:05:57

No matter how bad the news, they will always put a good spin to it. So I have to say I am putting my faith in the Time Monks. You know those computer wizards who built a machine that collects data, prints it out and the Monks determine the possible future?. Some Bad Ju Ju in March.
Hey they don't make things up like the news media or the Gooberment.

GM,Ford,Chrysler will combine. Lay off more workers as one special car is manufactured for all. Stock will go up and all is fine in America.

The dollar is up and gold is down. Did anyone expect different after the US markets opened?


mikalIt's the unity thing#1523662/20/07; 08:18:26

domain-B : Indian business : economy : Fewer currencies can target inflation better, says mathematician John Nash
Goldilox, IMO the "divide" Panzner foresees breaking the economy is not just over funding war. It's about about bringing a new 'unity' to gov't. Like the 'new currencies' proposed in this article by domain-b and Nash, a new gov't would serve to break any stalemate and gridlock standing in the way of fighting inflation and unemployment as these get underway with a vengeance. They know that no matter how hard they try, as policymakers they cannot escape the basic laws of markets and the economy, and that they must have a successor "plan" to deal with the real world ramifications of their own "managed" mismanagement. Conveniently, their foundations and think tanks have already proposed a full plate of such options to choose from.

mikalAnother 'scandal'#1523672/20/07; 08:43:29 SEC investigates Wall Street's top investment banks - CNN - Fortune - February 19, 2007
mikalAnother one bites the dust?#1523682/20/07; 09:08:35 Is Russia Headed for a Banking Crisis? | Anatoly Gorev - RIA Novosti - Opinion & analysis - Feb 19
Heck, this could even resolve itself with some one-worlder bailouts and political reshufflings, stylized on corporate fascism and banker's preferences of course.
Any way you look at it, east or west, 'planning' based on fiat and central banking rest upon open-ended models where losses created by central bureaucrats become dues of the people("by the people, for the people"). Liabilities that is, for those lacking gold.

Pal$$$ $701.5 $$$$#1523692/20/07; 09:17:37

I was thinking of all the different problems and imbalances in the world that could cause a movement into gold and thus an ensuing higher unit cost as measured by Federal Reserve Notes and the list below(in no particular order) is what I thought of.

01. Derivatives(The Comptroller of the Currency has some great charts on this at:
specifically scroll down to table one to see a breakdown of the derivatives balance of the top 25 commercial banks in the US)
02. Twin Deficits(Current Account and Trade)
03. Mark-to-Market Gold Reserves(I finally checked through the balance sheets of every country listed at: and what I found is that 41 out of 56 countries listed are MTM their gold reserves, 6 do not list any gold balance, 5 are showing a gold valuation a few hundred dollars below market, 1 showing total gold dollar value but no listing of ounces, and 3 are listing their gold value below $55/ounce)
04.US Dollar weakness(reserve status, locked into long-term down-trendline, US Dollar denominated open markets bypassed by direct contracts between supplier and customer and invoiced in local currencies)
05. Housing Slowdown
06. ARM implosion(This is being tracked here:
07. Easy credit spigot turned off(Credit contraction beginning by large banks)
08. Middle East Wars
09. Impending strike on Iran
10. Oil Bourses invoicing in currencies other than US Dollars(Russian and IOB-still waiting for this one)
11. Yen Carry Trade(or the end thereof)
12. Naked Shorting
13. Resource Nationalization in South America and Russia
14. Weak US borders
15. Rumors of North American Union
16. Global climate change
17. Increasing demand of commodities by developing countries
18. Weaponization of outer space
19. Chinese Military buildup
20. South American countries uniting with an anti-US bent
21. Hidden M3 and the reconstructed M3 showing 10%+ growth
22. Slowing US economy as shown even by hedonistic GDP growth figures over last couple of QTRs
23. Severe lack of leaders in government willing to fix problems before eruption
24. Secular commodities bull market(see CCI)
25. Recent warnings from Trichet and Weber in Davos, Switzerland
26. Slowing sales of bullion by central banks(below allowable limit)
27. Increasing demand from ETFs(GLD, SLV, and more coming online)
28. Possible increase of gold demand from China due to 'Year of the Pig'
29. Investor appetite for risk(see VIX, the plateau of prosperity delusion)
30. Web Bot Predictions

I think all of these topics have been covered here at some point and I am sure I have forgotten some. Surely, some of these areas will cause greater pressure on the gold price than others but taken together as a whole it leaves one quoting the Mogambo Guru, "We are all freaking doomed!"

Yet with all of the issues listed above the POG is still contained below a high(not adjusted for inflation) of twenty-seven years ago. How can this be? Even if the US still has the gold in reserve that it claims and if you figure M3 approaching Eleven Trillion Dollars we should see a POG around $40,000+ an ounce. This contest question got me to consider why hasn't gold made larger leaps in price to make up this ground. It seems as though new ways are continually invented to paper over the price. Margin requirements are lowered, price movement thresholds are increased, and a seemingly endless ability to increase short positions. I'm considering that maybe the paper markets are just for show. As long as the paper traders are willing to settle for dollar units this game could be played seemingly forever. But if economic laws really exist then at some point they would start to intrude into this 'show'. Because behind all this paper there remain real bars of gold owned by persons or entities that I have to believe are aware of the issues I've listed above and are not really willing to part with their PHYSICAL Gold. What are the agreements and guarantees to those large bullion holders that they would keep their gold available in registered storage vaults available for derivative paper trading? It makes one wonder...
So what I see is increasing demand for physical metal for a supply that isn't really for sale. The growing realization of the global population of the importance of taking physical delivery of their purchased gold is what we must be seeing in the price as it ascends in its revaluation process. As long as the issues above continue more will congregate under the golden banner until a critical mass is obtained and then the 'show' will end. The paper gold is being tortured and will burn and through this process it will be transubstantiated into a new form where gold metal will rule.
The confluence of issues above is leading to a global financial crisis, to which no amount of liquidity will save us. Gazing into a crystal ball I might see a sequence of events that looks something like this...
We are already seeing a credit contraction by the big banks as can be evidenced by the twenty-three sub-prime mortgage lenders closing shop in the last two months. I find this especially important because if I read the Austrian economists correctly they say the boom fueled by short-term credit expansion will end when that easy credit is reigned in. I think that process has started. I think that there is such interconnectedness in the financial markets due to the derivatives market that no-one knows where the risks are and therein lies the rub. This sub-prime blowout will start a conflagration in the global financial markets where the issues listed above will just add fuel to the fire. I will not be surprised if a strike on Iran in March causes the Iranians to close the Straits of Hormuz causing oil delivery defaults from which they will be blamed for the ensuing chaos in financial markets which will have already been started by the credit contraction I've already mentioned. We can't have the general population become aware of who is really to blame for this mess now can we? So for the rest of the year we see a continued slowdown in housing, slowing business activity, unemployment, increasing international conflict, increasing rate of inflation, bank failures, et cetera... in one word (hyper?)Stagflation. This leads to a breaking of the pre-arranged agreements I theorized about above. I am afraid that the size of the financial mess could take at least a year or more to sort out during which time a suitable physical price discovery mechanism might not be presented for some time. Who would really be willing to part with their gold during this type of upheaval if they didn't absolutely have to? If a financial crisis actually gets underway this year I think it is possible that we might see $1,650/ounce gold by the end of the year, but the paper market may stop trading at about the same time. This would put us into next year before the real value of physical metal as measured by fiat might begin to be seen. I should note here that my personal record at 'timing' seems to always be early so the above timetable is probably way off. I am sure of one thing though... it will be 'interesting' times to survive through.


mikal@Slingshot, Goldilox#1523702/20/07; 09:22:01

The market opens in one country and at some point closes
in another. Buyers are everywhere there are sellers, the sun never sets on gold.

GoldiloxGold markets#1523712/20/07; 09:49:37

@ mikal,

I'm well aware of the access markets and opportunities to trade away from the COMIX and London, but the major short sellers seem to trade these two for the greatest effect.


mikal@Pal#1523722/20/07; 09:52:37

Great post, you cover most of the bases in your numbered summary and your very well researched points!

As for "a physical price discovery mechanism" not being available this year or in the aftermath of a financial crisis, IMO the IMS(Int'l Monetary System) would function as smooth as ever where gold transactions are concerned. The international, preminent monetary denominaire gets first priority in transactions between countries when the global economy is "benign". When there is no longer denial about the true ship of state, the diversions will shift into ANOTHER phase, continuing their hold on power and the power to print money whatever the cost to, say cost of living.
Too this is their opportunity to 'fine-tune' the IMS as planned, headed by the BIS, leading central bankers
and economists. Should be "interesting" as you say.

mikal@Goldi#1523732/20/07; 10:05:11

Yes, selling, but all adds fuel to the fire.
What goes around comes around.
Winding and coiling.
Those buyers you said "come in at these levels"
have expanded to include the CB's themselves or their proxies as investors everywhere mitigate their losses and
erect shields against the hostile environment.
Positioning best to use the momentum of the tense, coiled spring and the laws of nature.
This is the buyer's bargain market mentality.
First come, first served my friend!

Gandalf the WhiteTAA TAA TAAAAAAAAAAAAAAAAAAAAA TAA TAA! #1523742/20/07; 10:22:14

<;-( ---> I'm running LATE again !

$$$$$$$$$$$$$$ A "PRICE of GOLD" (POG) GUESSING CONTEST!! $$$$$$$$$$$$

We shall have a price guessing contest on the closing (Settlement price) of gold for the April COMEX Contract (GCJ07) on the last day of this month. Wednesday, February 28, 2007, ---BUT all entries must be posted to the TableRound before Midnight on Saturday, February 24th, AND ALL ENTRIES must answer "THE QUESTION" !!

Based on numerous prognostications from both recognized metals industrial companies executives, financial "experts", taxi drivers, "politicians" and "OTHERS" – that the price of gold this year will be somewhere between $500 and $2,000, the QUESTION is:

What do you think the highest price of gold (POG) will be this year, AND, in thirty words or more, Why????

This POG Contest winner -- the closest price guess to the actual Settlement Price -- will receive a rather rare collectors piece, a Danish 20 Kroner goldpiece, having the likeness of King Christian IX on the obverse, but commonly known as a "Mermaid" for the content of the reverse side of the coin !

The "Mermaid" 20 Kronor goldpiece had a total mintage of only 1.5 million, as compared to the nearly 110 million mintage of its period cousin, the English Queen Victoria sovereigns. It gets its name from the blend of a stoic Lady Liberty, enthroned with what I think is a porpoise or dolphin, swimming at her feet. Christian IX, pictured on the obverse of the coin, was known as the 'father-in-law' of Europe because two of his daughters and one son married into the royal lines of England, Russia and Greece respectively, and his grandson became the King of Norway. This coin is exceedingly popular with the people of Denmark in that the "Mermaid" is the national symbol of the country. These beautiful gold pieces were minted between the years of 1873 and 1900, have a Fineness of 0.900, and Actual Gold Content of 0.2592 troy ounce. This prize coin was minted in the first year of production, 1873 !

There will be also be two runners-up prizes for the next closest prognostications --- each winning an one ounce pure Silver U.S. Eagle.


1) The Winner is the poster with the Price Guess closest to the Settlement price of the COMEX (most active) April 2007 Gold Contract (GCJ07) on the date of Wednesday, February 28, 2007.

2) Price "Guesses" shall be stated in Dollars and tenths !
(Such as $666.6)

3) "Guesses" shall be SHOWN in the SUBJECT BOX location AND enclosed in markers of "Dollar Signs" so as to be OFFICIAL !
(Such as $$$$$ $666.6 $$$$$$$ )

4) ONLY one "Guess" per Knight or Lady is allowed, and once that "Guess" has been "taken" -- no one can duplicate it !! FIRST COME has rights to that "Guess".

5) HOWEVER, All "Guesses" MUST be posted before the clock in Denver strikes MIDNIGHT (24:00) on Saturday, February 24, 2007.

6) AND MOST IMPORTANTLY (as this part MUST accompany the Price prognostication) --- In order for your entry to be valid, entries will need to have a full answer to the QUESTION, in 30 words, OR MORE. <===== NOTE !!!
LET the CONTEST continue !!

slingshotPal#1523762/20/07; 12:44:09

Great post.

It is remarkable that as you mentioned, this forum has debated at one time or another the subjects you have listed. The pile grows each week with a new twist. There had been weeks before the news media gets close to the event and we are well into discussion and disection as it pertains to gold and or the financial markets. This contest will mark a turning point. Those that say, It doesn't impact me". I say an ICBM with a range of 11,000 nautical miles sure does. The world is getting smaller by the day.What took months now is seconds.
Again, Great post.

mikalFree hand may give green light to BOJ's ratesetters#1523772/20/07; 12:46:23;_ylt=AmoeTICaJPjsOrZnkBOEZDimOrgF

BoJ to Meet on Interest Rates Amid Easing Political Heat Tue Feb 20 - TOKYO (AFP) - Excerpt: "The Bank of Japan, still smarting from criticism it bowed to government pressure last month, is due to meet to discuss an interest rate rise amid an apparent easing of the political heat.
Market watchers see roughly a 50-50 chance of a quarter-point rate hike to 0.5 percent by the central bank on Wednesday, after Japan's economy logged its strongest growth in almost three years in the fourth quarter of 2006."

Mikal- IMO, by delaying another 1/4 pt. increase AGAIN,
the BOJ would damage the "confidence" this article highlights as driving their decisions.
But unspoken, is the impact on the currency markets such a choice would entail. These are among the concerns which place the BOJ in a pretty much identical shrinking and shrinking box as the Fed finds itself in.

mikal(No Subject)#1523782/20/07; 13:17:43!-Global-systemic-crisis-April-2007-Inflexion-point-of-the-phase-of-impact-US-economy-enters_a448.html

GlobalEurope Anticipation Bulletin
Confidential Letter of European think-tank LEAP/Europe 2020
Global systemic crisis - April 2007: Inflexion point of the phase of impact / US economy enters recession
- Public announcement GEAB N°12 / Feb 16, 07 / Snippit:
"As anticipated last January in GEAB N°11, the « fog of statistics » is now clearing and US economic trends appear clearly (retail sales at a standstill in January 2007, record high trade deficit in 2006, downward revision of US growth for 2006, Fed's confirmation of economic slowdown, serial defaults among mortgage lending organisations, continued collapse of US housing market,...). Therefore, according to LEAP/E2020, and contingent on the specific evolution of each component of the US economy, the month of April will account for the inflexion point of the impact phase of the global systemic crisis, that is to say the moment when all negative consequences of the crisis pile up exponentially. More precisely, April will be the time when negative trends will converge, transforming many « sectorial crises » into a generalised crisis, a « very great depression », involving all economic, financial, commercial and political players.

In April 2007, nine practical consequences of the unfolding crisis will converge:

1. Acceleration of the pace and size of bankruptcies among US financial organisations: from one per week today to one per day in April
2. Spectacular rise of US home foreclosures: 10 million Americans out on the street
3. Accelerating collapse of housing prices in the US: - 25%
4. Entry into recession of the US economy in April 2007
5. Precipitous rate cut by the US Federal Reserve
6. Growing importance of China-USA trade conflicts
7. China's shift out of US dollars / Yen carry trade reversal
8. Sudden drop of US dollar value against Euro, Yuan and Yen
9. Tumble of Sterling Pound

In this February issue of the GlobalEurope Anticipation Bulletin (on subscription), LEAP/E2020 details the nature and sequence of these developments meant for all concerned players (currency or financial market operators, investors, international traders, political and economic decisions-makers or analysts) to better anticipation events. Strategy is time mastery! In the present issue of GEAB, our teams endeavoured to build a device to overcome this quarter's accelerating developments.

In this public announcement, LEAP/E2020 describes one of these nine direct consequences otherwise detailed in GEAB N°12 (on subscription), i.e.:"

xylo$$$$675.10$$$$$#1523792/20/07; 13:21:27

With so many factors influencing the price of gold, particularly this past year. it is impossible for anyone to predict with any reasonable assurance what the end of year closing price will be. There appears to be no rational for the volatility we have seen other than to assume that the "Players" are just using the current interest and momentum in gold to extract their pound of flesh from every gold transaction. I don't believe that anyone is at the wheel or in control at the moment.

If world events continue as they have for the past few years, I can envision gold ending the year at $787.00

GoldiloxWal-Mart Profit Rises 9.8%; Home Depot Has 28% Fall#1523802/20/07; 14:25:17


Feb. 20 (Bloomberg) -- Wal-Mart Stores Inc., the world's largest retailer, said fourth-quarter profit rose more than analysts estimated as discounts drew shoppers. Home Depot Inc. had a record drop because falling U.S. home sales cut demand.


While WalMart basks in "discounted" sales, Home Depot and Lowe's do battle for a rapidly shrinking home sales market.

USAGOLD Daily Market ReportPage Update!#1523812/20/07; 14:50:35">
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 20 (Reuters, MarketWatch) -- U.S. gold futures finished down nearly 2 percent in thin trade on Tuesday, as liquidations by funds and weaker crude oil prices dragged the precious metal to its lowest level in more than a week.

The markets in China and Taiwan will remain closed all week for the Lunar New Year celebrations, while those in Hong Kong, Malaysia, and Singapore were closed on Tuesday and will reopen on Wednesday.

Most-active gold for April delivery on the COMEX division of the New York Mercantile Exchange settled down $11.80 at $661.00. Tuesday's session included some volatile price swings. The April contract bottomed at $659.00 after it peaked at $677.80 in early electronic trade.

Noncommercial players in U.S. gold -- basically speculators -- were net long 124,750 contracts as of last Tuesday, up 15 percent from 108,546 lots in the week to Feb. 6, according to the Commodity Futures and Trading Commission's most recent Commitment of Traders report.

Paul McLeod, vice president of precious metals at CommerzBank, said that he wouldn't be surprised if the gold market took some time to consolidate gains, as it had performed well over the last three weeks.

The April contract has gained almost 9 percent since it bottomed at $607.20 on Jan. 5.

McLeod said that the precious metals' fundamentals remained strong. However, "the characteristic of volatility is not going to leave this market," McLeod added.

Bill O'Neil at LOGIC advisors said gold fell because of lower oil prices and a firmer dollar. "We got a little over-speculated. The funds got a little bit too long. As a result of that, we basically saw some liquidations in fairly thin conditions," O'Neill said.

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

Wheelthru$$$$$682.40$$$$#1523822/20/07; 15:01:11

My guess of $682.40 settlement for the April Gold Comex contract on 2/28/07 can only be justified by the foolish actions of the PPT. Weighing all the fundamental particulars into the actual "value" of an ounce of the precious, I think one would conservatively place a 1 between the $ and the 6. ($1682.40 for those having trouble with the visual). My best guess for the 2007 high price would be $1001.42. The reason for this is purely whimsical and a decent estimate for ’07 on its way to the $1692 number by end 2008. (OK $1001.42 is actually my birth date. Jan 10, 1942)
TownCrierGold stalls but seen heading higher#1523832/20/07; 15:01:20

LONDON (Reuters) - Gold prices were slightly softer on Tuesday, but analysts said a fundamentally weaker dollar and stronger demand from investors, jewellery makers and central banks could push prices higher in the future.

"The dollar picture from here is that it will continue to weaken till the end of the first half of this year," said Tariq Salaria, metals analyst at Standard Chartered.

"It's hard not to be positive given the underlying fundamental ... I wouldn't want to be (selling) this market."

Barclays Capital said in a research note, "Barring another surge in price and volatility, we expect demand to consolidate and firm up gradually over the year."

Analysts say expectations that the central banks of Russia, Asia and Middle Eastern countries could diversify their reserves, some possibly into gold, will also underpin prices.

The technical picture, too, looks positive, but analysts think gold needs a period of consolidation since the run higher from January 5, when it hit a two-month low of $601.70.

Traders say consolidation could take place this week because of the Lunar New Year holiday breaks across much of Asia have subdued the market.

"But the United States is back today and when they see where gold has been, there could be a scrum," the trader said.

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

A tidy little summary.


Ag-geekWorking at a mine has it's perks!#1523842/20/07; 15:39:40

Just witnessed the creation of about 44,000 troy ounces of dore. 99% silver and 1% gold. At current prices that's a cool $890,000!! That never get's old!!!
Ag-geekP.S.#1523852/20/07; 15:40:56

That's real metal, not paper!!
Federal_ReservesMay 28, 1998 - USA GOLD's website#1523862/20/07; 16:26:37

TownCrierFederal_Reserves, That . . . is . . . AWESOME!!#1523872/20/07; 16:37:59

That snapshot of the USAGOLD homepage from May 1998 really shows how far this website has developed in the past few years. With a little more hard work, it'll *almost* be worthy of the distinguished 34-year-old brokerage (Centennial Precious Metals, Inc.) that supports it, which has itself been standing like a pillar of strength since 1973.

A continuing thanks to all in the gold investment community for their contributions and participations.


MKFederal Reserves & Randy. . .#1523882/20/07; 17:27:51

My o my. . .how far we've come! Gotta love those high tech spinning globes. I can remember the days when we were grateful just to be on the internet - a new medium through which we could deliver the gold message. I remember too in those days that the media was still almost completely anti-gold, and this site was what we believed to be a feeble attempt to fight back. Times have changed. Sites like this one are flourishing while the mainstream media is scrambling to find its place in it. Randy, did you note going from 82,000 visitors to 450,000 in roughly a year? I can remember how proud we were of that. Things are a bit different now, aren't they?

We were talking the other day about what might we expect next from the internet. . . .I have some ideas. . .But you know what, I think websites that specialize in something and people know that's the place to go for that something -- like this one -- will continue to flourish. Specialization will be the key. People want to know where to go to get reliable information on matters important to them. We hope to stay cutting edge and offer more content and visitor comfort as we move along. People know where to go if they want to stay current on the gold market. . . .

I was talking with Jeff Marett, the techie who helped us create this website, the other day and he was telling me that he believed a revolt was developing against the high tech websites with all the bells and whistles. It's not what gets visitors. Content and services get visitors. We've always kept it simple and that's been one of our secrets, but when you are dealing with something as basic and essential as gold coins and bullion, it's not difficult to stay grounded.

That was fun, way back when, when Another thundered across the internet and we were all pioneers. . . .Back in my college days many of us were taken by a book by a Canadian professor named McCluhan. It's title was "The Medium is the Message" -- a clever juxtaposition and no where has that proven to be more true than with the internet. We are committed to continuing to develop the message -- no frills attached.

Long may these castle walls stand. . .for the benefit of all.


Where are all the contest participants? Everyone going to pile in the last few days? I wonder how many contestants who posted on the last day actually came out the winner. Anyone tracked that? It would be interesting to know.

Gandalf the WhiteSIR MK#1523892/20/07; 18:10:04

In response to your Question ---
"Where are all the contest participants?"
--- The Hobbits are thinking that the Question was far too difficult this time and that the entrants are trying to figure it out ! The truth is that the VOLATILITY will be the problem to figure out what the winning SETTLEMENT number on Feb. 28th should be !!

Gandalf the WhiteTAA TAA TAAAAAAAAAAAAA, ----> UPDATE #1523902/20/07; 18:13:18

$$$$$$$$$$$$$$ THE FEBRUARY 2007 "PRICE of GOLD" GUESSING CONTEST!! $$$$$$$$$$$$


Entries as of DAY #6 -- (2/20/07) at just about 18:12 Denver time !!!

Listed in order of decreasing values !

$$$$ $775.5 $$$$ Sprout (2/16/07; 18:42:09MT - msg#: 152256)

**** $727.5 **** Thoreauly (2/17/07; 07:46:31MT - msg#: 152267)

$$$$ $724.6 $$$$ Topaz (2/15/07; 04:55:38MT - msg#: 152177)

$$$$ $701.5 $$$$ Pal (2/20/07; 09:17:37MT - msg#: 152369)

$$$$ $695.0 $$$$ Sundeck (2/16/07; 04:38:24MT - msg#: 152221)

$$$$ $688.0 $$$$ Goldilox (2/16/07; 11:26:32MT - msg#: 152238)

$$$$ $687.8 $$$$ Lebieque (2/15/07; 03:55:18MT - msg#: 152174)

$$$$ $685.0 $$$$ Toolie (2/15/07; 03:10:40MT - msg#: 152170)

$$$$ $684.8 $$$$ Freedom (2/18/07; 13:37:59MT - msg#: 152295)

**** $678.0 **** Rook (2/17/07; 19:55:35MT - msg#: 152278)

$$$$ $675.1 $$$$ xylo (2/20/07; 13:21:27MT - msg#: 152379)

$$$$ $673.5 $$$$ Lothar of the Hill People (2/17/07; 13:25:18MT - msg#: 152271)

**** $670.0 **** Liberty Head (2/17/07; 10:03:22MT - msg#: 152270)

$$$$ $666.6 $$$$ Minero (2/17/07; 07:39:45MT - msg#: 152266)

$$$$ $662.5 $$$$ Henri (2/16/07; 11:02:33MT - msg#: 152235)
$$$$ $682.4 $$$$ Wheelthru (2/20/07; 15:01:11MT - msg#: 152382)

$$$$ $658.0 $$$$ flow5 (2/15/07; 12:19:26MT - msg#: 152184)


GoldiloxCongrats#1523912/20/07; 18:18:12

@ MK and TC,

As a personal computer "pioneer" and network storage professional, I applaud the minimal frills approach. I've yet to have difficulty navigating anywhere on your site, and that just makes gathering information even more satisfying.

And TC has done a good job creatively within those confines.

There is nothing more frustrating than getting oh, so close to your desired content, only to be stranded in JAVA Hell, waiting for the browser to "clear its drain".

Thanks again.

Now, will someone my guess for April Gold next week to the PPT? I'm happy to offer them some honest "direction".

GOLD FINGERAsia off for a week~#1523922/20/07; 19:22:52

New year has just begun for gold. The year of the Pig or Boar. Much is to be considered here in this new season. Things are not quite as what's perceived. Time will tell.

Happy Fat Tuesday!

Gandalf the WhiteThe POG Contest FIRST "King of the Hill" report !!! <;-)#1523942/20/07; 20:04:58


Tuesday 2/20/2007
GOLD COMEX April 2007 Contract (GCJ07)



$$$$ $662.5 $$$$ Henri (2/16/07; 11:02:33MT - msg#: 152235)

AND the present KING OF THE HILL is: ===> Sir Henri !!

PS: things should be looking UP from here on out !

Chris PowellVietnam forsakes real economy for stock trading#1523952/20/07; 22:30:41

Stock Market Mania
Grips Vietnamese

By Amy Kazmin
Financial Times, London
Tuesday, February 20, 2007

A manager at a foreign-run hotel and part-time MBA student, Nguyen Dung, 26, had never owned shares in a company until recently. But last week, impressed by the spectacular rise of Vietnam's stock market, he invested $650 in an informal pool with 30 of his MBA classmates.

The MBA students have agreed to pool information and tips and invest in a murky -- and unregulated -- informal market for shares in partially-privatised state-owned companies. To Mr. Dung, what to any astute investor in the developed world would seem a risky bet, looks like a sure thing.

"In Vietnam, the stock market is changing day by day," he says. "If anyone has the correct information, they can get easy money."

After watching the formal stock market's main index soar by 249 per cent over the last 13 months, Vietnam's emerging middle class is in the throws of stock market mania and students, civil servants and state enterprise managers with cash to spare are all rushing to buy shares and dreaming of windfall profits.

The recent bull run on the formal exchange, with 107 listed companies, has been propelled partly by foreign investors, eager for exposure to one of Asia's fastest-growing economies.

But for Vietnamese investors there is even greater euphoria in the market for the unlisted shares in hundreds of partially-privatised former state enterprises that may, or may not, list on the formal exchange one day. A recent auction put a $170m value on a copper cable company that reported $1.1m in profits last year.

"It's a frenzy," says Jonathan Pincus, the U.N.'s chief economist in Hanoi. "All the chatter in Hanoi is about people investing in the market. I don't know if anyone knows what these companies are worth, but they are buying the paper."

As tales emerge of local investors buying shares in defunct banks, Vietnamese authorities are fretting that many citizens -- rather than getting rich -- may be poised to see their savings evaporate. Yet officials are also struggling to cool the speculative fervour without precipitating a market collapse.

"The government is obviously concerned that the stock market prices are increasing continuously and many observers are of the view that it is fairly much overvalued," said Il Houng Lee, the International Monetary Fund's resident representative in Hanoi. "This could lead to problems later on if there is a rapid adjustment in the prices, given that there are many local investors involved."

Rules on bank lending for stock market purchases have tightened. Officials are also considering whether to impose a rule for foreign investors to keep their capital in Vietnam for one year.

Until recently Vietnamese tended to put what savings they had into more traditional assets such as gold or real estate. But in the past year the number of trading accounts in the Vietnamese stock market has almost quadrupled from 32,000 to about 120,000.

Brokerages are mushrooming, with 56 now licensed, up from 16 early last year. All kinds of companies are trying to get a bite of what they see as a lucrative business with one state garment maker, Vinatex, recently declaring it would open a stock-broking arm.

Vietnamese companies in an array of sectors appear to be using surplus cash to punt on the market instead of investing in their core activities. Sriyan Pietersz, head of research at JPMorgan, sees the dangers of this: "Apart from the fact that earnings could be volatile, you run the risk of under-investing in your business ... because management is too busy rooting around on its Bloomberg screen."

Authorities are also struggling to get stock market-obsessed civil servants to focus on their day jobs.

The central bank recently issued an edict prohibiting staff from making stock investments during working hours. But Tra Le, an executive vice-president at the stock exchange, says it is an uphill struggle. "Commercial bank staff are kind of lukewarm on their jobs and very interested in something else. They are just watching the screen and watching the price performance of shares, which is reducing the productivity of the banks."

mikalBOJ raises rate#1523962/21/07; 00:02:36 Bank of Japan Raises Key Interest Rate From .25% to .50%
Stock Market Quotes - Business News - Financial News at - Feb 21, 07

Goldendome(No Subject)#1523972/21/07; 00:11:39

MY my my Mikal, that could change some things. Could the Pacific Gulf Stream flow of carry trade be affected?
GoldendomeGold Is#1523982/21/07; 00:14:35

Gold doesn't care what you or I may think about it—nor what anyone may think about it.
Gold doesn't shout about itself—though others may. If you want it, it's there.

Gold can keep a secret. Gold can be an "X" on a map.

Gold demands no respect. It can hide in the swamp without rotting away; it can hide in your defunct Buick without being eaten by mice, but still shine like the sun out on a date.

Gold doesn't tout earnings; it has none to fail. Gold ‘is’ earnings we wish to stay whole.

Gold is quiet. Gold won't send you a 1099 dividend form, then tattle to Uncle and send him the same. Ditto for interest 1099's.

Gold won't send a record of sale for Uncle to check on one's 1040 schedule, form D. Nor form 4797 if you know what I mean or form 6252 year after year!

Gold won't care if one fails to neglect it on statements of assets. Future means testing and all…why would you want to?

Gold doesn't know it's value - but knows it will have some - unlike some paper and stocks or bonds. Nor does gold know what was exchanged to acquire it. Gold is a quantity acquired. That amount of grams, ounces, kilos, will be there…no more, no less.

Gandalf the WhiteTAA TAA TAAAAAAAAAAAAAAAAAAAAA TAA TAA! #1523992/21/07; 00:16:40

$$$$$$$$$$$$$$ A "PRICE of GOLD" (POG) GUESSING CONTEST!! $$$$$$$$$$$$

We shall have a price guessing contest on the closing (Settlement price) of gold for the April COMEX Contract (GCJ07) on the last day of this month. Wednesday, February 28, 2007, ---BUT all entries must be posted to the TableRound before Midnight on Saturday, February 24th, AND ALL ENTRIES must answer "THE QUESTION" !!

Based on numerous prognostications from both recognized metals industrial companies executives, financial "experts", taxi drivers, "politicians" and "OTHERS" – that the price of gold this year will be somewhere between $500 and $2,000, the QUESTION is:

What do you think the highest SPOT price of gold (POG) will be this year, AND, in thirty words or more, Why????

This POG Contest winner -- the closest price guess to the actual Settlement Price -- will receive a rather rare collectors piece, a Danish 20 Kroner goldpiece, having the likeness of King Christian IX on the obverse, but commonly known as a "Mermaid" for the content of the reverse side of the coin !

The "Mermaid" 20 Kronor goldpiece had a total mintage of only 1.5 million, as compared to the nearly 110 million mintage of its period cousin, the English Queen Victoria sovereigns. It gets its name from the blend of a stoic Lady Liberty, enthroned with what I think is a porpoise or dolphin, swimming at her feet. Christian IX, pictured on the obverse of the coin, was known as the 'father-in-law' of Europe because two of his daughters and one son married into the royal lines of England, Russia and Greece respectively, and his grandson became the King of Norway. This coin is exceedingly popular with the people of Denmark in that the "Mermaid" is the national symbol of the country. These beautiful gold pieces were minted between the years of 1873 and 1900, have a Fineness of 0.900, and Actual Gold Content of 0.2592 troy ounce. This prize coin was minted in the first year of production, 1873 !

There will be also be two runners-up prizes for the next closest prognostications --- each winning an one ounce pure Silver U.S. Eagle.


1) The Winner is the poster with the Price Guess closest to the Settlement price of the COMEX (most active) April 2007 Gold Contract (GCJ07) on the date of Wednesday, February 28, 2007.

2) Price "Guesses" shall be stated in Dollars and tenths !
(Such as $666.6)

3) "Guesses" shall be SHOWN in the SUBJECT BOX location AND enclosed in markers of "Dollar Signs" so as to be OFFICIAL !
(Such as $$$$$ $666.6 $$$$$$$ )

4) ONLY one "Guess" per Knight or Lady is allowed, and once that "Guess" has been "taken" -- no one can duplicate it !! FIRST COME has rights to that "Guess".

5) HOWEVER, All "Guesses" MUST be posted before the clock in Denver strikes MIDNIGHT (24:00) on Saturday, February 24, 2007.

6) AND MOST IMPORTANTLY (as this part MUST accompany the Price prognostication) --- In order for your entry to be valid, entries will need to have a full answer to the QUESTION, in 30 words, OR MORE. <===== NOTE !!!
LET the CONTEST continue !!

USAGOLD / Centennial Precious Metals, Inc.The PRIZE !#1524012/21/07; 00:35:28">gold Mermaid contest prize
TownCrierGoldendome msg #152398#1524022/21/07; 00:39:49

In a realm populated by over 150,000 posts, that one probably ranks comfortably in the Top 100.



geNYSE Margin Debt Reaches $285.6 Billion, Topping 2000 Record #1524032/21/07; 04:07:25

"Feb. 20 (Bloomberg) -- The amount of money borrowed from brokerages that do business on the New York Stock Exchange to buy stock reached a record $285.6 billion last month, topping the prior high set at the peak of the so-called Internet bubble."
mikal(No Subject)#1524042/21/07; 07:18:15

Bulletin: U.S. CPI Up 0.2% In January, More Than Expected - MarketWatch - Feb 21, 07
Most CB governors have been cautioning about
inflation heating up, but many traders have been complacent or expect rates to stay the same or fall. As Asians slowly return from holidays country by country, Thursday, Friday and Sunday night, some surprises await.

GoldiloxRon Paul Ownz the FED and PPT#1524052/21/07; 09:58:35

YouTube CSpan clip at URL shows Ron Paul spanking Choppa Ben on the House floor.

He talks about the harmful effects of FIAT, the constitutional illegality of the FED, and the damage done to the populace during the wealth transfer and manipulation of interest rates.

Should be required listening!

At least CSpan doesn't automatically cut away when it is his turn to speak like the "fair and balanced" networks.

Chris PowellROB-TV's Jim O'Connell takes medical leave#1524062/21/07; 10:14:45

12:09p ET Wednesday, February 21, 2007

Dear Friend of GATA and Gold:

Report on Business Television in Canada, which, because of its Internet video archive has been what might be called Radio Free America, announced Tuesday that the longtime host of its "Market Call" program, Jim O'Connell, will be taking leave to undergo treatment for cancer. ROB-TV's statement about O'Connell's leave is appended.

O'Connell has done a huge service to the friends of the precious metals and free markets by allowing -- no, ENCOURAGING -- discussion on the air of complaints that governments and central banks have been intervening in markets, particularly to suppress the gold price. So please include O'Connell in your thoughts and prayers and send him good wishes in care of ROB-TV. We NEED this man in journalism, since there is no one like him, and if our saying so is, after all, only selfish, at least we can be grateful.

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

* * *

From Report on Business Television
Tuesday, February 20, 2007

And finally, some news about one of our own. The guy who usually sits in this chair at this time every day, our colleague, Jim O'Connell, recently underwent medical tests and the diagnosis means he'll need to take some time off.

Jim has just learned he has colon cancer. It was diagnosed swiftly, it is operable, and Jim has been scheduled for surgery next week.

Jim has the very best of medical care and many positives that bode well for a strong recovery. Jim enjoys otherwise excellent physical health, having completed six marathons on five continents in the past 30 months. They include the Great Wall of China Marathon just last spring near Beijing. Jim also ran an unusual marathon in the Antarctic with his wife, Lisa, and other marathons in Rome, Chile, and Norway.

Jim says his greatest source of strength is his wife, Dr. Lisa Ramshaw, a forensic psychiatrist with a solid medical background. Together, they are determined to tackle this challenge head-on so they can resume their busy lives and finish all seven continents. Just two more to go.

Jim and Lisa just got married this past November. They have tremendous support from their sons, Daniel and Aaron, and a huge network of family and friends. If you would like to drop Jim a note, mail it to us and we'll make sure he gets it:

Jim O'Connell
c/o Market Call
Report on Business Television
720 King Street West
10th Floor
Toronto, Ontario
M5V 2T3

TownCrierNo end in sight for yen carry craze#1524072/21/07; 10:22:44

February 21, 2007
LONDON – High risk yen carry trades exploiting Japan's low interest rates are in no danger of losing their appeal as long as Japanese monetary policy remains predictable and financial market volatility stays low.

The BOJ raised rates to a decade high of 0.5 percent on Wednesday, saying it would tighten borrowing costs further but gradually.

Japan's rates are still the lowest in the industrialised world and the yen quickly erased initial gains to resume a broad decline, hitting a record low against the euro beyond 159.

Carry trades, where investors borrow in currencies with low interest rates and invest the proceeds in high yielding currencies, are seen by many as an unsustainable long-term strategy that can only thrive in a low-volatility environment with ample cheap money.

...Policymakers have warned one-way bets in carry trades can be dangerous and that risks are under-priced.

^---(see full text at url)---^

It's not just the low interest rate. Factor into the equation the yen's weakening exchange rate trend and you can see why so many punters are eager to borrow this mush today in the expectation that they will be more easily able to repay with cheaper trash tomorrow.

Closer to home, the gold carry trade no longer floats the hedgies boats because, despite a similarly low interest rate on borrowed gold, the rising goldprice trend makes the carry trade non-viable -- nobody wants to have future repayment obligations denominated in a currency unit that is strengthening. As a happy result, that particular avenue of paper gold creation over the past two decades has been largely eliminated from the bullion banks' arsenal of pseudo-supply which in turn had fed back into weaker prices supportive of the carry trade.

The more you can wrap your mind around this, the more you'll understand how significant it was that gold turned the corner in 1999 -- and is now being driven slowly but surely toward a new paradigm, to serve in a structurally significant capacity within a redesigned architecture of the international monetary system.


GoldiloxUp into the close?#1524082/21/07; 10:49:32

Gotta get to a meeting across town, so I won't be watching the actual COMIX close, but it's a nice morning so far for goldbugs.

$670 re-breached with authority.

slingshotVolatility#1524092/21/07; 11:01:40

Gold takes a right cross and is knocked to the canvass.
The referee sends the PTB to the neutral corner.
Gold again stands up,gloves up and after the 8 count steps into the oncoming boxer. Unleashing a flurry of punches sending his opponent back upon the ropes.
The crowd roars!


Flatliner@Volatility#1524102/21/07; 11:14:40

Hopefully, there will still be sellers tomorrow.
mikalNothing to see here. Denial, what's to deny?#1524112/21/07; 12:41:44

Before the Fall
An uneasy calm has settled over financial markets.
Economist Staff, The Economist
February 21, 2007 - Excerpt:
"It is a scene familiar to all Western lovers. The cavalry is riding through a mountain pass. One officer turns to a comrade. "I don't like it," he says nervously. "It's too quiet." The next second, an arrow hits him in the chest.

The financial markets are in a similar state of nervous anticipation. Things have been going extremely well. According to David Rosenberg of Merrill Lynch, the American stockmarket has sustained its longest run since 1954 without a day's decline of 2 percent. The interest-rate spread offered by high-yield, or junk, bonds over Treasury bonds is thinner than ever. Volatility is low. A market "correction", aimed straight at the chest, seems overdue.

The terminology of financial markets can be imprecise. A crash is a sudden, precipitate decline like "Black Monday" in October 1987, when the Dow Jones Industrial Average fell by 22.6 percent in one day. A bear market is a longer-lasting event such as the period from March 2000 to March 2003 when British share prices fell by half. A correction is somewhere between the two, neither as violent as a crash nor as prolonged as a bear market, with prices falling by around 10-20 percent.

Bull markets are generally interrupted by a few corrections. Apart from the 1987 crash, the great bull market of 1982-2000 saw setbacks in 1990, 1994 and 1998. There was a wobble in May-June last year (emerging markets took the biggest hit), but this bull market has trotted on pretty serenely for four years.

Corrections can be caused by economic downturns or by some kind of unexpected event, such as the Russian debt crisis of 1998. But they could also be seen as part of the natural rhythm of markets, as traders and investors pocket profits before climbing to new peaks.

What might prompt a correction now? One possible trigger might be the trend in corporate profits. For more than three years, American profits have been growing at an annual rate of over 10 percent. This has lent strong support to the stockmarket.

But capital is taking a bigger slice of America's national income now than in any of the past 40 years. Even if profits could hold that share, they would merely rise in line with the economy, perhaps by 5-6 percent a year (including inflation). Already, the pace appears to be slowing. In the fourth quarter of 2006, according to Capital Economics, a consultancy, the proportion of S&P 500 companies reporting disappointing earnings rose to its highest level in more than two years. If that trend continues, investors could lose heart.
Then there is debt..."

Mikal-- If I didn't know better, I'd think that the writers WANTED to see a "crash", or at least a "correction"-
the entire article is blunt and vivid, sparing on euphemisms.
And if the youth on the Economist staff who contributed to this story don't get their experience soon, at least there's enough real-time anecdotes to give them(and us)
some vicarious thrill in the meantime. ;)

Gandalf the WhiteThe POG Contest SECOND "King of the Hill" report !!! <;-)#1524122/21/07; 13:38:37


Wednesday 2/21/2007
GOLD COMEX April 2007 Contract (GCJ07)

SETTLEMENT = $684.0 which is + $23.0 from yesterday's 661.0


$$$$ $684.8 $$$$ Freedom (2/18/07; 13:37:59MT - msg#: 152295)

AND the present KING OF THE HILL is: ===> Sir Freedom !!

PS: LOVE that VOLATILITY !!! <;-)

USAGOLD Daily Market ReportPage Update!#1524132/21/07; 14:03:16">
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 21 (DowJones, MarketWatch) -- A slew of factors - higher crude oil, fund buying, technical momentum and Iran's nuclear program - combined to send gold and silver futures sharply higher Wednesday, traders and analysts reported.

Gold futures began their rally after the Labor Department said inflation at the retail level increased 0.2% in January, while the core CPI, which excludes food and energy prices, rose 0.3%.

Economists polled by MarketWatch had been looking for increases of 0.1% and 0.2%, respectively.

Last week, Federal Reserve Chairman Ben Bernanke told lawmakers that the Fed expects core inflation to drift lower, but cautioned that the Fed is poised to raise rates if necessary to contain inflation. Generally, when people think the Fed's going to raise rates, gold goes down, said Peter Schiff, president of Euro Pacific Capital.

Today's rally in gold "might be an indication that the Fed and Bernanke are losing credibility and that the Fed is all talk and no action," Schiff said.

"The Fed is afraid of raising interest rates, but it can't let the market know that. Gold's saying we don't believe you."

COMEX April gold contacts rose $23 to $684.

"They are pretty much following the energies, and some uncertainty relative to the next move by the U.N. against Iran," said Dave Rinehimer, director of futures research at Citigroup Global Markets. "There is more potential for escalation than an easing of tensions."

Shortly after gold closed, Nymex April crude oil was up $1.30 to $60.15 a barrel.

The sharp gains in the precious metals came just one day after Comex April gold lost $11.80.

Tuesday's pullback no doubt was viewed as a buying opportunity by some, said Michael Metz, chief investment strategist with Oppenheimer & Co.

"We are in a strong bull market in gold," he said. "Almost any setback is used by a lot of investors as an entry point."

Metz added that several new commodity funds are reportedly going into operation at the beginning of March. Thus, he said, there is market talk that some traders are positioning themselves long on ideas these funds will be putting money to work right away.

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

TownCrierGoldman CEO reaped record $54.3 mln in pay in 2006#1524142/21/07; 14:25:19

NEW YORK, Feb 21 (Reuters) - Goldman Sachs Group Chairman and Chief Executive Lloyd Blankfein received more than $54.3 million in cash, stock and options last year, setting a record for Wall Street CEO remuneration after leading the most profitable investment bank for just six months.

Blankfein, 52, [was] named CEO in June after Henry "Hank" Paulson quit to become U.S. Treasury Secretary...

Goldman set aside a jaw-dropping $16 billion for bonuses...

Paulson, who had led Goldman since its initial public offering in 1999, last year earned $19.2 million in salary and bonus...

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

Maybe Hank should've stayed on for the latter half of the year to enjoy a much more lucrative compensation package.



TownCrierGold president tips US$730 per ounce#1524152/21/07; 14:35:06

February 22, 2007 -- Gold will touch US$730 (HK$5,694) per ounce this year, closing in on last year's peak, according to William Lee Tak-lun, president of the Chinese Gold and Silver Exchange Society.

Lee reflected the bullish sentiment in the gold market as the exchange Wednesday marked the first trading day in the Year of the Pig.

Lee said the 97-year-old exchange is gradually paving the way for a public listing while also building up market infrastructure.

"The first step this year is to launch an electronic trading platform," Lee said. Currently, the exchange uses an open outcry method of dealing, with trading from 9am to 5pm.

Lee predicts trading volumes will multiply once the exchange begins electronic trading.

Lee said the system will allow for multi-currency trading and enable after- hours trading to match the opening hours of overseas markets.

Secretary for Financial Services and the Treasury Frederick Ma Si-hang ... cautioned investors to assess their own capacity and targets before putting money into an EQUITIES market that was at new highs. He said the market was easily affected by external factors...

Referring to the US$730 per ounce projection for gold, Ma said the price was "basically supported by the real demand for gold globally, especially from countries including China and Britain."

The appreciation of the yuan and the weakening greenback would stimulate gold demand in the mainland, Ma said.

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

A Chinese caution (yellow light) for investors in equities, but a solid green light on gold.


TownCrierHEADLINE: 3...2...1 LIFT OFF!!! Gold shoots up 23$#1524162/21/07; 14:40:58

By Jon Nones
21 Feb 2007 at 01:15 PM

Analysts are scurrying to decipher the action.

"Traders cannot literally catch their breath to talk to us - there is a LOT of shouting in the background - but it looks as if all kind of stops were being hit and whoever went short yesterday got massacred today if they did not jump on early enough ... funds drove it up and squeezed them."

"The market continues to be nervous as pundits are trying to grasp for news that motivated this leap (CPI? not enough to worry this much. Iran? too soon to really worry yet). The background noise appears to be Iran."

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

Investors who have been on a regular program of physical gold acquistion have no need to scurry. A calm understanding prevails. It's what separates the mighty from the minions.


RimhOh, that volatility....#1524172/21/07; 14:58:50

I thought traders loved volatility, but only, I suppose, if they have the inside track and stand to profit from it, not get their collective heads handed to them because they were short. I especially loved the commentary:

"there is a LOT of shouting in the background - but it looks as if all kind of stops were being hit and whoever went short yesterday got massacred today if they did not jump on early enough ..."

Hee Hee... Lots more to come, boys!

GoldiloxHank's "package"#1524182/21/07; 15:28:07


"Maybe Hank should've stayed on for the latter half of the year to enjoy a much more lucrative compensation package."

. . . and miss all those gubmint-paid groveling trips to China? never!

TownCrierU.S. money fund assets hit record highs#1524192/21/07; 15:54:34

WASHINGTON, Feb 21 (Reuters) - Investors added $6.04 billion to U.S. taxable money market funds in the latest week and $2.8 billion to tax-free money funds, the Money Fund Report said on Wednesday.

All money fund assets combined set a record high at $2.360 trillion...

"Markets in general are getting bigger. I don't think this record is due to investors hoarding cash," said Connie Bugbee, managing editor of iMoneyNet Inc.

If investors were hoarding cash then another market, such as stocks or bonds, would likely be falling at the same time, which is not the case, she noted.

"All this suggests that all this money in cash will stay in cash," Bugbee said.

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

Foremost, this indicates the sheer quantity of monetary liquidity sloshing around out there -- to support both the money market funds AND the various stocks and bonds, too.

Also, the record flows into these "cash" markets serves additionally as an indication that people are perhaps getting jittery over investments and are thereby attempting to take some of their chips off the table. Having a stake in money markets, however, means that they are effectively still sitting at the paper gaming table, still exposed to the risk of currency depreciation and loss of purchasing power against real goods.

Bottom line: there are massive wells of money that have yet to be hauled out into the sunlight for conversion into tangible wealth such as gold.


MKWhat is going on with gold?#1524202/21/07; 17:58:56

I was working on this piece over the weekend, and with today's events decided to bring it forward tonight, though there are some aspects to it I would like to have developed further. It contains some interesting chart analysis I think you might appreciate and gain from. We are releasing this essay to one and all to publish in full (and as long as it's in full). Please include a link back to USAGOLD. Also, please make sure you include the caveats at the bottom. They are important. We don't want anyone getting carried away.

Enjoy. I would appreciate your posting any comments you might have here at the forum.

GoldiloxNice essay#1524212/21/07; 18:23:05

@ MK,

Very good work, but I have a question. Your "Ten Reasons
Why you should choose USAGOLD-Centennial Precious Metals as your gold firm." says you have been in business 32 years, since 1973.

By my count, 1973 to 2007 is 34 years. Did you withdraw for two years during that stretch, or are you just losing track of time like the rest of us old f*rts? Once the years exceed twenty, and we run out of fingers and toes, the algorithm is a lot more difficult.

USAGOLD / Centennial Precious Metals, Inc.Especially designed for those who are taking their first step...#1524222/21/07; 19:28:18">gold ownership starter kit
Druid(No Subject)#1524232/21/07; 19:36:27

Druid: A chilling Table that might answer a few questions for those of you that might want to know if extremely high interest rates and stock markets can coexist. This is the one you show your friends and then head for the door.
Tevye$$$$$ $711.7 $$$$$#1524242/21/07; 19:50:55

I must be in the category of others, so this prognostication should carry that weight. The peak price of Gold this year will be $888.88. While we will soon eclipse $750 again, the battle will take us back down for a bit, whence the climb back to the moon will ontinue.

Next year will be even more fun.
Gold. Its Tradition!!!!


Chris PowellPeter Millar: Seven-fold increase in gold price need to avert debt depression#1524252/21/07; 20:06:41

7p ET Wednesday, February 21, 2007

Dear Friend of GATA and Gold:

While it is almost a year old, a study of the enduring importance of gold in the world economic system by R. Peter W. Millar, founder of Valu-Trac Investment Research Ltd. in Scotland (, seems ever more compelling, and Millar graciously has agreed to let it be shared with you.

Millar stresses the periodic upward revaluation of gold as the mechanism for defeating a deflationary debt depression at the end of an economic cycle. Millar writes:

"The first cycle unfolded as follows:

"-- Phase 1: Stability under a gold standard until 1914.

"-- Phase 2: Inflation until 1921, which resulted in a buildup of debt.

"-- Phase 3: Disinflation, which brought stability and allowed asset inflation until 1929, but encouraged a further buildup of debt.

"-- Phase 4: Instability after 1929 caused by deflation of assets from overpriced levels and exacerbated by excessive debt levels, leading to depression of economic activity.

"-- Phase 5: Monetary reform enabled by a revaluation of gold to overcome deflationary debt depression.

"In the second half of the 20th century we saw a repeat of the first three phases of the same cycle:

"-- Phase 1: Stability from 1944 to 1968 under a gold standard.

"-- Phase 2: Inflation from 1968 to 1981, which caused and justified another buildup of debt.

"-- Phase 3: Disinflation from 1981 until the end of the 20th century, and maybe to the present.

"However, it appears that Phase 4 (instability and ultimately deflation due to excessive debt) may have started. If so, Phase 5 (revaluation of the gold price to raise the monetary value of the world monetary base and hence reduce the burden of debt) becomes likely or inevitable. The extent of that revaluation would need to be major according to our calculations, probably by a factor of at least seven times, possibly up to 20 times the current price of gold."

The price of gold when Millar wrote his study, in May 2006, was about where it is tonight.

Millar's study is titled "The Relevance and Importance of Gold in the World Monetary System" and you can find it at GATA's Internet site here:

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

Tin Man$$$$$$691.1$$$$$$$$#1524262/21/07; 20:08:52

The year end price of gold will be $837.50 . Ingredients include...China and Asia purchases, oil, Centeral Bank purchases, limited supplies, further nationalization of mines. The biggest reason gold will continue its rise is because the masses are always wrong. Gold has had a terrific run over the last 7 years and still my fellow investors say that gold has gone as far as it can. They advise me to take profits now. As long as they continue to advise me to sell I will continue to buy.
mikal@MK#1524272/21/07; 20:33:40

Thanks for posting your essay. As always, what is meticulously detailed and relevant to the point of urgency is no less compact and engaging.
In all the years I've received your free news letter, this is presented just as sincere and erudite.
Regarding the commercials and the
open interest situation, it seems unavoidable that
some would begin to question the basic premise of
being perma-bear or "economic hit-men".


$$$$$$$$$$$$$$ THE FEBRUARY 2007 "PRICE of GOLD" GUESSING CONTEST!! $$$$$$$$$$$$


Entries as of DAY #7 -- (2/21/07) at just about 19:30 Denver time !!!

Listed in order of decreasing values !

$$$$ $775.5 $$$$ Sprout (2/16/07; 18:42:09MT - msg#: 152256)

US$730 (HK$5,694) 2- 22- 2007 -- Gold will touch --per ounce this year, according to William Lee Tak-lun, president of the Chinese Gold and Silver Exchange Society.

**** $727.5 **** Thoreauly (2/17/07; 07:46:31MT - msg#: 152267)

$$$$ $724.6 $$$$ Topaz (2/15/07; 04:55:38MT - msg#: 152177)

$$$$ $711.7 $$$$ Tevye (2/21/07; 19:50:55MT - msg#: 152424)

$$$$ $701.5 $$$$ Pal (2/20/07; 09:17:37MT - msg#: 152369)

$$$$ $695.0 $$$$ Sundeck (2/16/07; 04:38:24MT - msg#: 152221)

$$$$ $691.1 $$$$ Tin Man (2/21/07; 20:08:52MT - msg#: 152426)

$$$$ $688.0 $$$$ Goldilox (2/16/07; 11:26:32MT - msg#: 152238)

$$$$ $687.8 $$$$ Lebieque (2/15/07; 03:55:18MT - msg#: 152174)

$$$$ $685.0 $$$$ Toolie (2/15/07; 03:10:40MT - msg#: 152170)

$$$$ $684.8 $$$$ Freedom (2/18/07; 13:37:59MT - msg#: 152295)

$$$$ $682.4 $$$$ Wheelthru (2/20/07; 15:01:11MT - msg#: 152382)

**** $678.0 **** Rook (2/17/07; 19:55:35MT - msg#: 152278)

$$$$ $675.1 $$$$ xylo (2/20/07; 13:21:27MT - msg#: 152379)

$$$$ $673.5 $$$$ Lothar of the Hill People (2/17/07; 13:25:18MT - msg#: 152271)

**** $670.0 **** Liberty Head (2/17/07; 10:03:22MT - msg#: 152270)

$$$$ $666.6 $$$$ Minero (2/17/07; 07:39:45MT - msg#: 152266)

$$$$ $662.5 $$$$ Henri (2/16/07; 11:02:33MT - msg#: 152235)

$$$$ $658.0 $$$$ flow5 (2/15/07; 12:19:26MT - msg#: 152184)


Gandalf the WhiteOOPS ---- sorry !!!#1524292/21/07; 20:57:27

20:30 is better !

DruidNickel Coin Metal Value Reaches All-Time High: 7.5 cents!#1524302/21/07; 21:08:24

Druid: In addition to bullion, go long physical pennies and now nickels.
smiles45Surprise Rally#1524312/21/07; 21:26:01

Hello posters and MK,
I am a first time poster and long time reader.
The rally Wednesday seemed to be a complete surprise to the trade. Commercial interests are net short 177,000 futures and options on the Comex. The big four TOPCOM shorts are Sumitomo, Mitsubishi, Goldman Sachs and Mitsui are net short 139,000 contracts. Goldman & Mitsui have not even 1 long between the two companies, but are net short 65,000 lots(100/oz each).
As a trader for over 40years, I found it ill advised to fade the Commercials. Unless something earth shaking has occured Wednesday, I expect the POG correction to resume this Thursday & Friday.
Based on the above premise, I submit my bid for the April 28th futues closing price $$$$ 647.10 $$$$
I would like to commend this forum for it's high quality posts performed in uniquely civil manner. USAgold is by far the best website for genuine gold infomation and opinions coupled with a most diverse inventory of gold coins for sale./Peter

smiles45My last post sounds as if I am a bear#1524322/21/07; 21:36:44

In actuality, I am a super bull. My use of technical analysis has kept me in good stead for many years.
The correction if it comes soon is a blessing in disguise. All markets need to clean out the dead wood and weak sisters on a regular basis to maintain it's internal strength. This sell off, by my count will be the last major one until we have tested old record highs of $875.
POG indicators are currently quite overbought. This jibes well with the high Commercial net short positions. It is time gold begins to catch up to other metals!/Peter

mikalDiscus or manhole cover#1524332/21/07; 22:36:24 Mint plans 100-kilogram gold coin worth $2 million - Canada Press - Feb 21
Gold coin promiss more bang for the buck

GOLD FINGERI am Wondering?#1524342/21/07; 23:07:36

REF:MK (2/21/07; 17:58:56MT - msg#: 152420)
What is going on with gold?

I am wondering if the central bankers you mentioned in your publication on "What is going on with gold" wanted to possibly WAIT and HOLD on to their gold until they could get a HIGHER price?

In 2006, the participants in the Central Bank Gold Agreement failed -- and failed in a major way -- to meet the 500 tone sales quota they assigned themselves a year earlier. Germany, which has been pressured for years to sell its gold both internally and externally, refused to sell.

Perhaps in 2006 the POG was simply to low for them to sell?

When I first entered this forum back in march of 2006 much of the same kind of speculation and talk that drove GOLD up past the 700 figure was swirling around.

The high cost of oil, wars and more wars, the dollar continued decline and huge deficits and more. What's really changed since then? Not much!

Gold has continued to be attractive to many and with more and more being educated about it the demand is rising and most likely will continue.

I do feel that with these up-surge's that corrections loom and adjustments and profits are taken. (Good time to buy)

Perhaps if the central bankers SELL now it would be a good time and force a price drop? Buyers and Sellers are all a part of this game.

I am perplexed.

Once all the dust settles and things calm down, ultimately, gold has made a few advances on the price charts and increases are apparent.

Odd way of making it to the 1,000 USD but it looks like it's on the way.

I also wonder how dealers know when to buy? Is it hard to give up so much when gold is marching up-ward?

Also, it must be difficult to depart with some of the wonderful finds you offer to all of us? Not to mention GIVING AWAY some of the gold antiques!!



Chris PowellYou can know a few things, or you can have technical analysis#1524352/21/07; 23:26:24

1:18a ET Thursday, February 22, 2007

Dear Friend of GATA and Gold:

Some of us grunts in the gold army don't believe in technical analysis. To us it's just a bunch of entrail reading, astrology, and illusion, because the markets themselves now are mainly illusions.

Oh, we may speculate in the markets from time to time -- like every 20 minutes or so, or when our Viagra prescriptions run out -- but we figure that the exchange rates of the dollar and all the currencies and the prices of what Mike Bolser calls strategic commodities are not the results of the collective decisions of masses of traders in the futures pits but rather the results of entirely POLITICAL decisions made by the elites in chancelleries around the world. Those elites decide how much more paper and electronic digits and unfulfillable promises and real commodities will be pumped into the futures pits, whereupon the futures pits will pretend to determine prices.

Our advantage, such as it is, is in knowing -- believing, anyway -- a few things:

1) That the power of central banking is almost entirely the power to debase currencies. This is not always quite as bad as our side makes it seem, for our side overlooks that, for example, the United States, from its founding in 1776 through the attack on Pearl Harbor in 1941, had a catastrophic or near-catastrophic deflation on average every 10 or 15 years, during which a large share of the farmers and other real property owners were foreclosed on, industry and commerce collapsed, and there was much misery. The Federal Reserve system was created in 1913 in large part because J.P. Morgan -- the banker, not the predatory bank now bearing his name -- got annoyed at all the begging of the secretary of the treasury for gold loans to keep the U.S. government solvent until the latest panic subsided. As economists as diverse as Milton Friedman and Ben Bernanke have acknowledged, while the Fed failed its first big test in the 1920s and '30s, ever since then it has been inflating away, confident that deflation is no longer a possibility.

2) That money creation around the world has gone exponential in the last decade and as a result the ratio between money and real things has never been so out of whack.

3) That central bank gold can be dishoarded to keep the gold price down only until it runs out, and that while derivatives -- paper promises to deliver something -- can suppress prices for other real things as well, those other real things can run out too.

4) That the world will tire of being slaves to the issuers of the dollar and will find some other mechanism with which to conduct international trade, a mechanism that confers no advantage on any one nation and whose overhead is a fraction of the overhead imposed by the dollar. This mechanism easily could be gold, revalued sharply upward, or it could be something else. This change of trade systems may not happen for years, but it could happen tomorrow and indeed WILL happen when those who have had to use dollars without also having had the privilege of issuing them decide to make it happen.

5) That this will be entirely JUST, a resolution of the struggle between right and wrong. Those are," as Lincoln said, "the two principles that have stood face to face from the beginning of time, and will ever continue to struggle. The one is the common right of humanity, and the other the divine right of kings. It is the same principle in whatever shape it develops itself. It is the same spirit that says, 'You work and toil and earn bread, and I'll eat it.' No matter in what shape it comes, whether from the mouth of a king who seeks to bestride the people of his own nation and live by the fruit of their labor, or from one race of men as an apology for enslaving another race, it is the same tyrannical principle."

6) That this will be better for the United States too, since the imperial dollar -- "money for nothing, and your chicks for free" -- has corrupted and demoralized the country and crippled its industry, enterprise, and initiative.

7) That most of us under 60 are likely to see the resolution of this struggle and, if we invest accordingly, we'll not only be able to say we were right but also will be able to afford our own nursing home care -- at least in Panama or Guatemala.

But if you really MUST have technical analysis, there's some pretty good stuff arising from Wednesday's spectacular turnaround in gold and silver:

-- Michael Kosares, proprietor of Centennial Precious Metals in Denver and sponsor of the Forum, writes that "gold is telling us that something has been altered in the collective global psyche about the value of money." In "What is Going On With Gold," Kosares charts a reverse head and shoulders formation in the gold price that predicts a major move up:

-- Over at GoldSeek, Clive Maund sees "Commercials on the Ropes" and a likely panic as short positions are covered by those who have considered themselves the Masters of the Universe:

-- Jim Sinclair, maybe the most venerable and experienced trader among us, writes in his "Gold and Market Summary" for Wednesday that "gold is going to $761 now, but be assured it will attempt to shake you out at every turn." Sinclair expects volatility in gold approaching $150 per day:

-- Jason Hommel of Silver Stock Report asks "How Low Can Gold Go?" and figures that the worst possibility is $587, the inflation-adjusted price of gold in 1971, which was $35 just before the United States stopped repatriating dollars for gold:

-- And trader Rick Ackerman, writing at GoldSeek, wonders, "Something BIG Driving Gold?" He dishes deserved contempt on financial journalism and concludes, "If the $700 barrier is chop suey within a week, we can probably infer that something BIG is percolating beneath the gnarly surface of world events." You can find Ackerman's analysis here:

Who knows what alchemy the Fed and the Treasury will come up with tomorrow? It could be another mighty blow. We ARE used to getting bashed, paranoid even when we aren't being followed. But the government guys may have to get used to something too -- getting found out. Five years ago we were at $300. Tonight we're above $670. Put that on a scoreboard and it would say we're winning.

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

Beamer$$$$$$$$$$$$$$$ $1,250.00 $$$$$$$$$$$$$$$$#1524362/21/07; 23:42:07

Centennial Precious Metals makes the selection of the highest spot price for gold in 2007 so easy. They have provided us with the answer in the prologue to the question. $2,000 - $500 = $1,500 / 2 = $750 + $500 = $1,250. Simple! Actually, I base my assumption on what the real value should be for gold in inflation adjusted $$$ since 1980. That real value is somewhere in the vicinity of $2,000. Knowing that we have probably started the second leg of the gold bull market, it is reasonable to assume that the trend will be very long and with a decidedly upward bent. I would even say that the "Golden Year of the Pig' will have a huge impact on the demand for physical gold throughout the year. The sweet spot for buying physical gold is upon us and rest assured that it will last for a very long time.
GoldiloxWake up call?#1524372/22/07; 00:00:28

Last evening, I got into an "investment" discussion with a sculptor and a judge - talk about unlikely companions! I mentioned that no matter what one's favorite "investment" was, a prudent thing to do was regularly take money off the "casino table" and convert it to hard gold in personal possession to counteract the vagaries of currency depreciation. Then we then discussed the logistical options for doing that.

I don't know if the judge acted on our conversation, but I saw the sculptor again tonight and he told me he converted his cash savings (whose 2% interest no longer impressed him) to gold this morning before the 10AM rush.

I had noticed he was listening intently the night before, but I didn't realize he was so ready to act. I guess some of the "unitiated" public is "getting a clue".

I asked the sculptor what motivated him and he told me the price of copper for his creations had been sending him very powerful messages over the last year.

GoldendomeComment on Gold Fingers wonderings.#1524382/22/07; 00:17:53

Could the passage of time have changed Central Bank and public perception of central bank gold sales? We recall the British sale of their wealth at the bottom of the market. And the sales since – what have they accomplished for the sellers? If suppression of the gold price was part of the plan, then the sales have apparently failed in the longer term.

The question that I have sometimes asked myself and slowly answered over time is, why hasn't the United States sold off it's large horde of gold or a portion of it? Why has it been left to other foreign central banks to control (?) the price of gold while the U.S. stand aside from the process?

The answer that I've given to myself (and it may be totally incorrect) is two fold.

1) The old Bretton Woods illusion has been very good for the United States. Much of the U.S. and world citizenry still believes that gold backs the dollar. Regardless of the quantity of dollars pumped out, if we have the gold, those dollars are still backed by the gold, and in some wild flight of thought, those dollars would still be convertible. We may know this to be false but as long as the gold is still there, the perception lingers for many. Sell the U.S. gold stock and the illusion is finished.

2) If foreign central bankers sell their gold and hold dollars, this reinforces the perception of dollar strength. Who needs gold when the dollar is strong and backs foreign central bank currencies? The gold becomes unnecessary and may as well be cashed in to pay the national bills.

If bolstering confidence in the dollar was part of the gold sales plan, then unfortunately, continued and well-publicized deficit spending by all segments of the U.S. -- government and it's population-- is now severely straining that confidence. Foreign governments may have been led down the garden path for 30 years, but eventually, even the most stalwart players in the confidence game can discern from the screaming facts, that they are being wildly taken advantage of. The rise of the gold price in all currencies may be changing the thought processes that the markets and citizens of the world have caught on to the game and are once again choosing gold over paper. Better for central banks to hold onto what they have left of their real wealth, as the illusion of paper currency proceeds to flicker away.

GOLD FINGERI think so!!#1524392/22/07; 00:47:30

REF:Goldendome (2/22/07; 00:17:53MT - msg#: 152438)
I do think you hit it on the "SPOT"~

Now......what if I was to go to the bank tomorrow and pull out...lets say $50,000.00 cash.

What in the hell would I do with it?

1. Buy some fabiolus piece of limited art?
2. Invest in some of that apple stock or some other blue chip stock?
3. Purchase that nice piece of land that is subject to taxes, but is increasing in value because of its commercial zoning?
4. Buy that new Cadillac Escalade?
Go to an estate sale and buy all of granny's old European Antiques?
5. Up-date my kitchen?
6. Invest in a IRA? With a good yield of 4% hahhaa
7. Purchase and or invest in a business like franchise?
8. Municipal bonds? How about US Gove bonds? Good deal right?? haaa
9. A new walk in closet for my new suits?
10. GOLD? How I love the variety here!!

Out of the top ten, I bet you can see what makes sense in today's world!


TopazBuck:Bond#1524402/22/07; 01:42:58

Composite BB managing to maintain a certain equilibrium here with $PoG indicating success of the operation.
Aggie will (or should) drag $PoG higher as we roll through the day ...and the coming week.
Big day for Aggie today.
Currencies, as like sheep, it only takes one or two to step into the richly grassed paddock ...the rest will tentatively follow then ...hell breaks loose as they all rush to get inside.

Lets Watch!

Copperfield@Goldendome#1524412/22/07; 01:54:24

You said: 'The rise of the gold price in all currencies may be changing the thought processes that the markets and citizens of the world have caught on to the game and are once again choosing gold over paper. Better for central banks to hold onto what they have left of their real wealth, as the illusion of paper currency proceeds to flicker away.'

Former Italian central banker Fazio said in 2000: 'It is up to economists to analyze whether and to what extent, in an international monetary system that has surely not yet become fully consistent in many of its parts, reference to gold, which performed a monetary function for thousands of years, can still contribute, in the decades ahead, to preserving that fundamental condition for orderly economic activity - price stability.'

Maybe the European central bankers knew all along that gold would make a comeback in the collective thoughts of economists and the public?

smiles45Commercials in Hot Water#1524422/22/07; 03:10:26

Clive Maund has a new Gold Eagle essay. His contention is that Wednesday's $22 runup in the POG shows a disarray amongst the Commercials.
I trace my experience back to the 1974-80 gold and silver bull markets. In all those times was money ever an issue for the trade. As a matter of fact, initial margins were raised significantly for both specs and the trade. At the height of the gold market (limit up days)no trade house ever defaulted. They simply stopped selling and that caused the spike in the G & S prices. Never were any margin calls NOT met even towards the end when the calls came twice a day.
The funds of the trade are huge and their credit in those days was outstanding. Today it is commonly known by many inluding Gata that the trade houses are no less than government shills operating thru the massive bullion banks. Their pockets today are significantly deeper than in the 1970's being that they are allied with the Fed and Treasury. To keep the illusion of low inflation, they must keep down POG-AT ALL COSTS.
During the silver bull, Bunker Hunt( the primary buyer and long position) was forced to sell simply for lack of cash to take delivery on his contracts. The exchange worked in collusion with the trade at that time and made the silver market limited only to offsetting "sales". Where could the price go but down?
Clive Maund should stick with technical analysis as he is over his head on this topic. Although as an analyst he should also be aware of gold's overbought indicators. Beware of the experts, LOL.

"The sudden $22 rise in gold today is believed to be the result of the onset of an unseemly scramble by the Commercials to cover their short positions. It's anyone's guess what will happen when the key $680 level is decisively overcome - all hell could break loose. It could quite closely resemble the scene when someone yells "fire!" in a crowded theatre."

A bit dramatic, but everyone is entitled to an opinion. By giving false hope to novice investors could have them buying near or ON the or near the TOP./Peter

Cometosethought of the day#1524432/22/07; 06:59:41

this is a current headline as a rationalization for

Gold Declines in London on Speculation Price Swings Will Discourage Buyers

as the wizard of words waves his magic wand before the people in hopes of garnering a SHORT TERM RESPONSE.....
by way of his media for holding his observing public in spontaneous activity based on short term INFORMATION ....

The BIG PICTURE is not governed by the daily musings of the jumping jack journalists who sing the sirens song
in the context of knowing not what they do .........
to make simple sense of sickness superficially subdued
suppressed and silenced...............

BANKERS ARE THE CAUSE and they are the Wizards who attempt to hide the truth that :

EXCESSIVE MONEY PRINTING always causes prices to rise : INFLATION .......

Treating the sypmtoms of this inflation by PRINTING MORE MONEY seems to work in the short term ........

Metal by comparison begins to look scarcer and scarcer and is the LOGICAL ALTERNATIVE and IT'S price is the only

WATCHMAN to SOUND THE WARNING that BANKERS AND GOVERNMENTS have once again GONE TOO FAR in conjunction with Politicians making PROMISES they can't fundamentally finance soundly .


WERE IT NOT FOR GLOBAL supply (deficits) of RESOURCES that these EASTERN PEOPLES want and need BUILD WITH and to SAVE WITH ..........

and WERE it not for PEAK OIL

Journalists will come and go ........with their temporal labels and their short sighted musings........

but they can't stop this (pardon the oversimplified illustration) game of MUSICAL CHAIRS..........


THERE is only so much REAL MONEY (gold and silver) in the world..........


When there comes a global enlightenment again that GOLD AND SILVER ARE MONEY and FIAT (paper) MONEY has WORMWOOD EBOLA brought on by BANKERS MISMANAGEMENT ........and the masses begin to run

We've already seen the effects of SUPPLY shortages in Base metals ....

If yesterday wasn't warning of a flashpoint in the future ; it was surely just intended for our entertainment as are the musings of the JOURNALISTS that daily would like to put a superficial sense on something rooted under us like the electromagnetic field on the earth unseen to the naked eye...

slingshotSmiles45. False hope and buying at the top#1524442/22/07; 07:19:24

Boy is that a statement. When gold was heading to its lows (Falling Knife) I was saying to myself, "Man , this stuff is cheap" While my friends thought, "What a Moron" One friend even told me that if it was such a good deal, why don't I mortage my home. Anyhow From $254 to $677 is a long ways. The newbies have to do more research before jumping in the arena. As for the top I ask, Why are more Central Banks buying gold than selling it? England sells at the bottom and Russia can not buy all it wants at once cause it will shoot POG to the nearest star.Weigh the RISKS!

ThoreaulyGetting a charge out of gold#1524452/22/07; 07:35:36

"The researchers trapped a few molecules between a sheet of gold and the ultrafine gold tip of a scanning tunneling microscope, which is so sharp it can end in a single atom. They heated up the gold surface and measured, via the microscope tip, the voltage that was created."
balzacCONTEST#1524462/22/07; 09:35:46


IT IS TIME TO MAKE MY GUESS: $$$$662.1$$$$




Goldilox"Deja Vu all over again"#1524472/22/07; 10:02:37

The pit battles we witnessed at PoG $660 and $670 are being replayed for your entertainment at $680. Welcome to the future!

-Department of Redundancy Department

GoldendomeChanging one person at a time#1524482/22/07; 10:28:47

Goldi: I enjoyed the story of the Judge and Sculpture that you posted early today. Yours must have been a convincing and persuasive point of view, to have so quickly pushed a button on one who evidently had been watching and only needed a little extra courage or affirmation to make the move to gold that he saw as necessary. I applaud you.
Gandalf the WhiteTAA TAA TAAAAAAAAAAAAAAAAAAAAA TAA TAA! #1524492/22/07; 10:44:12

$$$$$$$$$$$$$$ A "PRICE of GOLD" (POG) GUESSING CONTEST!! $$$$$$$$$$$$

We shall have a price guessing contest on the closing (Settlement price) of gold for the April COMEX Contract (GCJ07) on the last day of this month. Wednesday, February 28, 2007, ---BUT all entries must be posted to the TableRound before Midnight on Saturday, February 24th, AND ALL ENTRIES must answer "THE QUESTION" !!

Based on numerous prognostications from both recognized metals industrial companies executives, financial "experts", taxi drivers, "politicians" and "OTHERS" – that the price of gold this year will be somewhere between $500 and $2,000, the QUESTION is:

What do you think the highest SPOT price of gold (POG) will be this year, AND, in thirty words or more, Why????

This POG Contest winner -- the closest price guess to the actual Settlement Price -- will receive a rather rare collectors piece, a Danish 20 Kroner goldpiece, having the likeness of King Christian IX on the obverse, but commonly known as a "Mermaid" for the content of the reverse side of the coin !

The "Mermaid" 20 Kronor goldpiece had a total mintage of only 1.5 million, as compared to the nearly 110 million mintage of its period cousin, the English Queen Victoria sovereigns. It gets its name from the blend of a stoic Lady Liberty, enthroned with what I think is a porpoise or dolphin, swimming at her feet. Christian IX, pictured on the obverse of the coin, was known as the 'father-in-law' of Europe because two of his daughters and one son married into the royal lines of England, Russia and Greece respectively, and his grandson became the King of Norway. This coin is exceedingly popular with the people of Denmark in that the "Mermaid" is the national symbol of the country. These beautiful gold pieces were minted between the years of 1873 and 1900, have a Fineness of 0.900, and Actual Gold Content of 0.2592 troy ounce. This prize coin was minted in the first year of production, 1873 !

There will be also be two runners-up prizes for the next closest prognostications --- each winning an one ounce pure Silver U.S. Eagle.


1) The Winner is the poster with the Price Guess closest to the Settlement price of the COMEX (most active) April 2007 Gold Contract (GCJ07) on the date of Wednesday, February 28, 2007.

2) Price "Guesses" shall be stated in Dollars and tenths !
(Such as $666.6)

3) "Guesses" shall be SHOWN in the SUBJECT BOX location AND enclosed in markers of "Dollar Signs" so as to be OFFICIAL !
(Such as $$$$$ $666.6 $$$$$$$ )

4) ONLY one "Guess" per Knight or Lady is allowed, and once that "Guess" has been "taken" -- no one can duplicate it !! FIRST COME has rights to that "Guess".

5) HOWEVER, All "Guesses" MUST be posted before the clock in Denver strikes MIDNIGHT (24:00) on Saturday, February 24, 2007.

6) AND MOST IMPORTANTLY (as this part MUST accompany the Price prognostication) --- In order for your entry to be valid, entries will need to have a full answer to the QUESTION, in 30 words, OR MORE. <===== NOTE !!!
LET the CONTEST continue !!

Paper AvalancheCNBC Story on Gold 10 Minutes Ago#1524502/22/07; 10:48:36

Sue Herrera just had two investment professionals on to discuss the future of gold. One prdicted that gold would possibly hit $2,000 in the next year or two. The other said that $3,000 was possible further out. Very interesting to watch.


Gandalf the WhiteTAA TAA TAAAAAAAAAAAAAAAAAAAAA ! --- UPDATE #1524512/22/07; 10:48:44

$$$$$$$$$$$$$$ THE FEBRUARY 2007 "PRICE of GOLD" GUESSING CONTEST!! $$$$$$$$$$$$


Entries as of DAY #8 -- (2/22/07) at just about 10:45 Denver time !!!

Listed in order of decreasing values !

$$$$ $1,250.0 $$$ Beamer (2/21/07; 23:42:07MT - msg#: 152436)

$$$$ $775.5 $$$$ Sprout (2/16/07; 18:42:09MT - msg#: 152256)

US$730 (HK$5,694) 2- 22- 2007 -- Gold will touch --per ounce this year, according to William Lee Tak-lun, president of the Chinese Gold and Silver Exchange Society.

**** $727.5 **** Thoreauly (2/17/07; 07:46:31MT - msg#: 152267)

$$$$ $724.6 $$$$ Topaz (2/15/07; 04:55:38MT - msg#: 152177)

$$$$ $711.7 $$$$ Tevye (2/21/07; 19:50:55MT - msg#: 152424)

$$$$ $701.5 $$$$ Pal (2/20/07; 09:17:37MT - msg#: 152369)

$$$$ $695.0 $$$$ Sundeck (2/16/07; 04:38:24MT - msg#: 152221)

$$$$ $691.1 $$$$ Tin Man (2/21/07; 20:08:52MT - msg#: 152426)

$$$$ $688.0 $$$$ Goldilox (2/16/07; 11:26:32MT - msg#: 152238)

$$$$ $687.8 $$$$ Lebieque (2/15/07; 03:55:18MT - msg#: 152174)

$$$$ $685.0 $$$$ Toolie (2/15/07; 03:10:40MT - msg#: 152170)

$$$$ $684.8 $$$$ Freedom (2/18/07; 13:37:59MT - msg#: 152295)

$$$$ $682.4 $$$$ Wheelthru (2/20/07; 15:01:11MT - msg#: 152382)

**** $678.0 **** Rook (2/17/07; 19:55:35MT - msg#: 152278)

$$$$ $675.1 $$$$ xylo (2/20/07; 13:21:27MT - msg#: 152379)

$$$$ $647.1 $$$$ smiles45 (2/21/07; 21:26:01MT - msg#: 152431)

$$$$ $673.5 $$$$ Lothar of the Hill People (2/17/07; 13:25:18MT - msg#: 152271)

**** $670.0 **** Liberty Head (2/17/07; 10:03:22MT - msg#: 152270)

$$$$ $666.6 $$$$ Minero (2/17/07; 07:39:45MT - msg#: 152266)

$$$$ $662.5 $$$$ Henri (2/16/07; 11:02:33MT - msg#: 152235)

$$$$ $662.1 $$$$ balzac (2/22/07; 09:35:46MT - msg#: 152446)

$$$$ $658.0 $$$$ flow5 (2/15/07; 12:19:26MT - msg#: 152184)

$$$$ $647.10 $$$$ smiles45 (2/21/07; 21:26:01MT - msg#: 152431)


TopazBuckenBond.#1524522/22/07; 10:56:09

The e's again served up a truckload of negativity on Bond this am but, contrary to yesterday, today they ran.
PoG should've popped another $20 greenday on the strength (weakness) of it.
With options expiry today, maybe they're holding back for a doubler of sorts tomorrow. We'll see soon enough!

Gandalf the WhitePlease Please Please ! <;-)#1524532/22/07; 10:58:36

I am begging all PROGNOSTICATORS in the POG Contest to READ Rule # 3, and not try to trick the O'le Wizard.
I expect that from Sir Smeagol, BUT not others !
(BTW, where is that Smeagol ?)

WHY ? -- you ask --- BECAUSE, most times, I have very little time to read every posting and may MISS hidden entries, but today I was able to spend more time at the TableRound and read SIR MK's indepth thoughts posting "What is going on with gold?",
which may be reached in the link of posting # 152420.

Like Sir Ari used to say "GOLD, get you some!"

Chris PowellBarrick accelerates reduction of gold hedges#1524542/22/07; 11:05:14

Excerpted from
Barrick Gold Corp. Press Release
Thursday, February 22, 2007

Hedge Book Reduction

During fourth quarter 2006, Barrick reduced its fixed price Corporate Gold Sales Contract position by 1.0 million ounces, and incurred a pre-tax opportunity cost of $327 million ($0.37 per share) against its gold sales.

For the full year Barrick reduced its fixed price committed gold sales contracts by 9.4 million ounces, including the elimination of the legacy Placer Dome gold hedge position.

At February 21, 2007, the company had completely eliminated its fixed price corporate gold sales contract position, more than two years ahead of its previously announced target date.

Furthermore, the company plans to eliminate the remaining floating spot price contracts by the end of the second quarter. As a result of these deliveries, the company expects to incur an after-tax opportunity cost of $564 million in Q1 2007 and $65 million in Q2 2007.

"Barrick is very positive on the long-term outlook for gold," said [CEO] Greg Wilkins. "The elimination of all non-project related hedge contracts allows the company to benefit fully from higher gold prices at its operating mines."

TitanHank Paulson did a little better than we thought#1524552/22/07; 11:09:21

Yesterday in post #152414, TownCrier said (probably tongue in cheek), "Maybe Hank should've stayed on for the latter half of the year to enjoy a much more lucrative compensation package."

On page C3 of today's Wall Street Journal, it's reported that Paulson and his wife actually got an additional $51.4 million from the company's repurchase of their investments in a number of the firm's private-equity and hedge funds. It says, "According to the proxy statement, the company repurchased the investments after Mr. Paulson left the company to become Treasury Secretary in June."

So in addition to the $19.2 reported before, he added another $50 mil or so to his bank account. That should support his family pretty decently while he sacrifices for his country in his new govt. job!

USAGOLD / Centennial Precious Metals, Inc.The Contest PRIZE ! To be given away for correctly guessing the April gold contract's closing price on Feb. 28th#1524562/22/07; 11:17:12">gold Mermaid contest prize
mikalBreaking news bulletin!#1524572/22/07; 11:33:06

Copper Soars 6% - Reuters - February 22, 2007
Oil Prices Jump Above $61 a Barrel - AP - 02/22
Home Lenders Hit by Higher Default Rates - NY Times - 02/22
Fed Faces Credibility Crunch - - 02/22
A Painful Hiss from the Subprime Balloon - BusinessWeek - 02/22/2007
Corn prices hit fresh 10-year high - FT - 02/21
Emerging market debt trade soars - FT 02/22
Goldman Details CEO's $54.3 Million Pay - AP - 02/21
New chill between U.S., Russia freezes Boeing out of jet order - Seattle Times 02/22/2007 (Aeroflot suspends order)Japan Posts Unexpected Trade Surplus as Exports Surge - Bloomberg - 02/22
India Companies to Quadruple Sales of Bonds Overseas - Bloomberg -02/22/2007
Storm Cloud at the Global Bazaar? - Wash. Post - 02/22
States try to calm ire over high property taxes - - 02/22
U.S. Treasuries Extend Decline Before Five-Year Note Auction - Bloomberg - 02/22

Topaz@Titan#1524582/22/07; 11:47:37

It was reported a couple of weeks ago that herr Paulson was joining the ranks of uber-altruists and giving his est. $800m fortune to charity...
I suppose he could wear no undies, shave his head and do the rehab shuffle?
Of course he can't, he's under arrest for the Wanta thing isn't he?

Things sure are getting confusing!

Lexxtesting#1524592/22/07; 11:57:41

Gandalf the WhiteThe POG Contest THIRD "King of the Hill" report !!! <;-)#1524602/22/07; 12:15:00


Wednesday 2/22/2007
GOLD COMEX April 2007 Contract (GCJ07)

SETTLEMENT = $683.0 which is - $1.0 from yesterday's 684.0


$$$$ $682.4 $$$$ Wheelthru (2/20/07; 15:01:11MT - msg#: 152382)

The present KING OF THE HILL is: ===> Sir Wheelthru !!

USAGOLD Daily Market ReportPage Update!#1524612/22/07; 15:29:32">
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 22 (Reuters) -- U.S. gold futures finished a dollar lower on Thursday as investors took a breather after solid gains in the previous session, but analysts said the precious metal could turn around and test the $700 an ounce psychological mark soon.

The COMEX April contract settled down $1.00 at $683.00, traded in a range between $678.70 and $684.70.

The contract largely held its gains from Wednesday, when it surged more than 3 percent to finish at its loftiest level in more than seven months, boosted by technical and fund buying and stronger oil prices.

Stephen Platt, analyst at Archer Financials, cited profit taking for gold's pullback on Thursday and said that the market might need to consolidate a bit before moving higher. "Given yesterday's activity, I have to be a believer that we are still going to be working higher and probably make a test of that $700 area," Platt added.

Mike Guido, director of hedge fund marketing at Societe Generale, said there was a "very strong consensus in the market to see higher prices," driven by geopolitical tensions, expectations for a weaker dollar and strong inflow to bullion exchange-traded funds.

"As long as you stay above these levels, $670 to $675 (April gold basis), you're carving out a platform for a new higher range," Guido said. "Probably a target for $700 in the short term," Guido said.

In mining news, both Barrick Gold Corp.and Newmont Mining Corp., the world's two leading gold producers, respectively, were forecasting lower gold production in 2007.

Also, Barrick said that it had completely eliminated its fixed-price gold hedge contracts more than two years ahead of its target date in a move to fully take advantage of higher gold prices.

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

TownCrierHEADLINE: Inflation talk spooks the market -- Gold $1,000 is on the way#1524622/22/07; 15:40:07

NEW YORK (MarketWatch) -- Even the most die hard gold bear has to admit that the recent price action in gold has been indicative of a very healthy bull market. It's alive and well, even after the best efforts by naysayers to smack it down.

Gold rallied over $20 Wednesday on news that the government is still concerned about inflation. That combined with a rise in oil prices and growing fear over a confrontation with Iran and suddenly April gold is right back up to near $700. The lack of fanfare from the business media and the seemingly unnoticed strength in gold are a good sign. A true bull market often flies under the radar.

Gold bulls don't see this move as a surprise but still welcome it anyway.

The metals markets have been a tough place for the commodities trade and mining shares have not been much gentler with investors either. Wicked swings in pricing and heavy volatility have made the metals a tricky place to trade indeed...

Anything can happen and often does but with all that's taking place in the world right now, gold is one of the few safe havens for investors.

Gold is often called a flight to quality instrument. Often in times of war or fear investors turn to the yellow metal to avoid any major fluctuation in their respective currencies, even the U.S. dollar. Gold is a good hedge against inflation too and combine these two elements and you have a very strong bullish argument for gold going to $1,000.

As more U.S. warships move into the Strait of Hormuz and the disaster quotient escalates with Iran, the market will become more and more nervous and may begin to look for that flight to quality -- really soon.

^---(see full text at url)---^

Forget trading. Buy the metal and then it's your choice to sit back or to charge ahead, but either way, better prepared to take life as it comes.


mikalKenneth Rogoff quoted #1524632/22/07; 16:23:29

U.S. Current-Account Deficit Deserves Some Noise By John M. Berry | Feb. 22 (Bloomberg) -Snippits: To read the annual Economic Report of the President, one would think the whopping U.S. current- account deficit is no more than a minor bookkeeping entry of little importance to the future of the U.S. economy...

Harvard University economist Kenneth Rogoff, who is also a former chief economist of the International Monetary Fund, says he believes the current-account deficit is worth a good deal more comment than that. For one thing, it could lead to a plunge in the dollar, he warned recently."

^^This focusses on many specific "conundrums" of the economy in a rare display of competance as a number of basic, specific issues are brought to the fore.
Quoting noted libertarian Rogoff at length, many
financial imbalances can be surmised,
though they're not always stated.
The total story, the big picture comes when we
consider the obvious interdependency and interrelationships the media blatantly omits or denies.

glockmaster19$$$$ $691.2 $$$$#1524642/22/07; 16:35:32

The highest spot price of gold this year will be $1,555.
The dollar is going down very soon. As Bill Bonner pointed out:

The US must finance nearly $3 billion worth of trade deficit every day of the week. That means, the foreigners must buy, net, $3 billion worth of US dollar assets. Well, in December, the foreigners must have gotten a little sick of sending their money to the US.
Net inflows from foreigners were only $15 billion – about $75 billion short. Oops. If that continues, the dollar is doomed. And so are the other assets in which the dollar figures prominently – notably US stocks and bonds.

We will get some more small inflow months like this. Then with a trend, the Asian Banks will stop supporting the dollar, and it will go down by 40%. Gold will rise dramatically.

pilgrims_gold$$$$ 676.5 $$$$#1524652/22/07; 16:47:36

The highest price of spot gold will at least be over its 80's high of 800. We put a scare on it last year when we got to the mid 700's and this is the year we put our historic high as a new target. Even Barricks is being told to get rid of your hedge before it bites you on the @ss!
Federal_ReservesChina's Gold Medal Count#1524662/22/07; 17:02:54


With the Olympics still a year and a half away, preparations continue to gain traction. But while Chinese athletes seem to be in top form, pollution problems have cast a haze over the city of Beijing.

On the bright side for China, according to today's world rankings, if the Olympics were held today, Chinese athletes would lead the pack, winning 48 gold medals, and 84 overall, whereas the U.S. would have 37 gold and 93 total. By comparison, in the 2004 Olympics in Athens, the U.S. was the medal leader with 35 gold and 105 total.

> I can see it now, US athletes hacking and coughing
> across the finish line.

smiles45Top of the move-Not the top of the gold rally#1524672/22/07; 17:42:00

Slingshot Yes, the phrasing wasn't exact enough. I was referring to the top of this current rally. In prior posts I made it clear that I thought after this correction a move to $875 is coming.
My point really was that new investors guide themselves from gold writers and analysts and are reluctant to DD. Some writers are good (re: Mr Jim Sinclair, Mr. Richard Russell & Mr. Harry Brown come to mind). Others are newer less experienced writers that sound plausible, but are poor on their timing./Peter

BoxmanLong time no see, my loss no doubt#1524682/22/07; 17:49:06

It has been a long time since I have posted, so it is great to see so many of the old names that I followed and admired. Sadly, there appears there are several that no longer post. If any of you are lurkers, please at least post now and again. Black Blade, you do know that the older one gets the less he is supposed to work. How about visiting, oh, lets say every 4 to 5 day. The same goes for all past warriors no longer posting.

To the point: After 28 years in the corrugated box business, I am no employed with a small propane business.
The reason I bring it up, is that the box business was a good barometer for judging how our manufacturing sector was doing. Pretty simple really. However, the propane industry mystifies me. To my knowledge, all of the products related to petroleum are in boom times. However, there are few, if any of the major propane companies that are performing particularly well. Seems they are looking to increase volume and are in a price war mentality.

I just got my son to switch his IRA money out of two mutual funds, and buy into mining stocks. He got in on Wednesday morning and is up 9% already. I want another gold bug in the family. Now to get him to buy the physical, and start following this site, and I will view myself as a successful father.

Sorry to be off topic, just wanted to ramble some. ( I did mention gold after all)


Boxman$$$$715.2$$$$#1524692/22/07; 18:16:35

The highest spot price of gold this year will be $915.00. The one advantage of not following the site for the last couple of years, is that I can see how much worse some of things that were previously discussed as reasons why gold would stay in a bull market have become.

Not only do those concerns still exist, but there are now considerably more reasons for concern. 1) the cost of the conflict in the middle east (it is not a war, as congress has not had the intestinal fortitude to address their responsibilities). 2) the apparent mortgage fiasco that is brewing, and how much pain that will cause not only the economy, but also far too many families. 3) the incredible increase in the economies of China, India, and many third world countries, who won't be third world much longer. These countries will continue to grow, and will make commodities the place to be for several more years. I believe the outcome will be the USA that will be viewed as a third world debtor nation.

This is but a few of the more recent concerns.

Without gold and silver, the future may be very scary for the majority of families across the globe.


slingshotBoxman#1524702/22/07; 18:33:47

Welcome back Sir Boxman. I remember you.
Say hello to Hank Hill for me.

flow5Golds Course#1524712/22/07; 19:08:03

Stagflation is on the horizon. The stock market is vulnerable.

Gold will retrace until the middle of March.
Gold will then rebound.
Central Bankers cannot fix golds price.
Golds allure overrides its intrinsic value.

Armageddon$$$$$ 725.0 $$$$$$$#1524732/22/07; 21:30:39

Smeagol$$$$ FRN677.7 $$$$#1524742/22/07; 21:36:03

Yess, precious... didn't we hear the Contesst Trumpetses once again on the wind? That always brings a smile to Smeagol's face (if not our ears), but we were busy following Black Blade's advice for awhile.

(...sss... and jusst as we get all lined up on a shot at It, ssomebody gooses the price by twenty or so dollars, precious... it's hard enough for us jusst to use the Castle's bows and arrowses.... maybe we should ask Slingshot for his sling insstead (cackle)... but now... a moving target? Ach! Volatility, we hates it, we curses it... now we has to think about our Guess all over again!) >8-(

Ssss... as for the highesst price of It this year, precious...and why? All poor Smeagol can do is look around at all the chartses going haywire, and the Powers war-posing, and the debts piling up, and the ignorant sheepses piling it on, and the Powers eyeing mines and resources, and the endless liquidity, and throw up our handses, and ssay... $790?...sss...(but it could spike to 829, or 870?)...ach, we doesn't know where It's going... except UP!

...wait jusssst a second, that's not right, precious (green-eyed grin)...we DOES know. Ssss! It's going NOWHERE! Because It is the rock against which all tricksy-paper wrecks in the storm... sso... what we are reeeally trying to guess is not the price of It... but the rate at which all the tricksy-currencies in the World are going DOWN (cackle).

That's why! >8-)

Caradoc$$$$ $742.0 $$$$#1524752/22/07; 21:41:15

High water mark for spot gold this calendar year should be $1,642. "Why that number" requires some background... Gold's 1980 move to mid 800s was the market trying to go to $900 (Sinclair's predicted number in late 79), i.e., the price point where the amount of presumably US-owned gold would represent sufficient value to allow the US government to "balance its books." True, it got stopped before it got to $900 (and Sinclair warned people a day or two ahead of time), but it had been headed toward $900.

About 7 years ago, gold had bottomed and in beginning its rise again took aim at the price which -- as of late 1999 -- would have balanced the books: $1,642. It's ironic that during 7 years of price manipulation, the number actually needed to balance the books has more than doubled and is in the process of doubling again. Evenso, after 7 years of trying, the market will want to recognize $1,642 as an interim target before going to whatever higher number it needs to go to.


CaradocHey, Armageddon...#1524762/22/07; 21:47:38

Your contest entry is properly formatted as regards the title text, but it's missing your 30 or more words on 2007's high and why. I suggest you resubmit in accord with the contest rules lest you incur the wrath of our wizardly contest master.

Just a word to the wise...


24karat$$$$699.1$$$$#1524772/22/07; 22:14:38

This year gold will see $800. It took awhile but I think Joe Six-pack is starting to pay some attention to what's happenning to the metals market. He is seeing more and more gold bullion ads in the financial magazines. There is more mention of the precious metals in the business news. ETF's are sowing up suddenly. He is beginning to ask his buddies what they think is going on. By the time he talks to Goldilox, he will be convinced that gold-in-hand is the place to be.
Armageddon@Cardoc, @Webmaster, @Gandalf - $$$$$$$$My Contest Entry$$$$$$$#1524782/22/07; 22:39:41

I did post a complete answer however apparently it was deleted by the webmaster. On a closer look on what I posted before I just realized that some comments might be too controversial for a gold web site that also is a business.
The following is the censored version of my previous contest entry.
I think that gold will reach a high spot price of $50,000 per ounce this year. Bush is planning a full scale nuclear attack on Iran


A full scale attack on Iran involving nuclear weapons will send oil to at least $200 per barrel, severely damage world trade, the world economy, and thus the confidence that all those fiat paper dollars, yen, etc are based upon. Gold's value does not depend on the existence of a country or a prosperous world trading system but has inherent value.

Flatliner$$$$$ $663.8 $$$$$$$#1524792/22/07; 23:02:49

He who longs to acquire another ounce finds that the price of gold rides a wave of fear and greed that trembles and stays his hand. To high is the price at which it trades. To hard is the burden of debt settlement that no capital remains to place into savings. Yet, so cheap is the precious metal. As all the currencies sink, it will be only those that take advantage of the current convertibility option that will come out on top. One only needs to ask – what might the price of gold be if the price of currency is zero? Gold never goes to zero and the wise ones know this.

While we wait for more to find the currency worth-less, we may see the paper markets dance like never before. Up 20, down 20, is this price discovery? What is being discovered when longs square up against shorts where no delivery actually occurs? We may see $800 gold paper and a spot to match, but we may also see a rule changes to help keep physical metal flowing and speculation at bay.

He who is prepared for change, finds time unfolds in a friendly manor. Get another ounce for there is no need to rush things.

melda laureThe last putrid fruit of the rotten old tree.#1524802/22/07; 23:42:16

@ armageddon, & unpleasant forebodings.
Times will change. I just witnessed the last morse code test ever. Some day we will see the last print run of the $1 bill. Good or bad, all things wear down to their end.

The match that lights this fire is no longer material, so many are the well oiled faggots piled high that spontaneous combustion is likely at any minute, indeed so high is the flow of combustible liquidity that the fuel hasn't enough air to burn as yet.

Consider for a moment that serbian nationalists started WW1. Consider also the absurdity of this accepted historical cause. How could something so trivial start such a conflagration? Quite simply the fruit was fully ripe- the merest breath of air was sufficient excuse for its fall.

melda laurefriendly manor, yes#1524812/22/07; 23:48:09

"He who is prepared for change, finds time unfolds in a friendly manor."

Indeed, he has left the smouldering casino and the faulty towers, and found a better home: one less prone to arson.

Gandalf the WhiteTAA TAA TAAAAAAAAAAAAAAAAAAAAA TAA TAA! #1524822/23/07; 00:08:47

$$$$$$$$$$$$$$ A "PRICE of GOLD" (POG) GUESSING CONTEST!! $$$$$$$$$$$$

We shall have a price guessing contest on the closing (Settlement price) of gold for the April COMEX Contract (GCJ07) on the last day of this month. Wednesday, February 28, 2007, ---BUT all entries must be posted to the TableRound before Midnight on Saturday, February 24th, AND ALL ENTRIES must answer "THE QUESTION" !!

Based on numerous prognostications from both recognized metals industrial companies executives, financial "experts", taxi drivers, "politicians" and "OTHERS" – that the price of gold this year will be somewhere between $500 and $2,000, the QUESTION is:

What do you think the highest SPOT price of gold (POG) will be this year, AND, in thirty words or more, Why????

This POG Contest winner -- the closest price guess to the actual Settlement Price -- will receive a rather rare collectors piece, a Danish 20 Kroner goldpiece, having the likeness of King Christian IX on the obverse, but commonly known as a "Mermaid" for the content of the reverse side of the coin !

The "Mermaid" 20 Kronor goldpiece had a total mintage of only 1.5 million, as compared to the nearly 110 million mintage of its period cousin, the English Queen Victoria sovereigns. It gets its name from the blend of a stoic Lady Liberty, enthroned with what I think is a porpoise or dolphin, swimming at her feet. Christian IX, pictured on the obverse of the coin, was known as the 'father-in-law' of Europe because two of his daughters and one son married into the royal lines of England, Russia and Greece respectively, and his grandson became the King of Norway. This coin is exceedingly popular with the people of Denmark in that the "Mermaid" is the national symbol of the country. These beautiful gold pieces were minted between the years of 1873 and 1900, have a Fineness of 0.900, and Actual Gold Content of 0.2592 troy ounce. This prize coin was minted in the first year of production, 1873 !

There will be also be two runners-up prizes for the next closest prognostications --- each winning an one ounce pure Silver U.S. Eagle.


1) The Winner is the poster with the Price Guess closest to the Settlement price of the COMEX (most active) April 2007 Gold Contract (GCJ07) on the date of Wednesday, February 28, 2007.

2) Price "Guesses" shall be stated in Dollars and tenths !
(Such as $666.6)

3) "Guesses" shall be SHOWN in the SUBJECT BOX location AND enclosed in markers of "Dollar Signs" so as to be OFFICIAL !
(Such as $$$$$ $666.6 $$$$$$$ )

4) ONLY one "Guess" per Knight or Lady is allowed, and once that "Guess" has been "taken" -- no one can duplicate it !! FIRST COME has rights to that "Guess".

5) HOWEVER, All "Guesses" MUST be posted before the clock in Denver strikes MIDNIGHT (24:00) on Saturday, February 24, 2007.

6) AND MOST IMPORTANTLY (as this part MUST accompany the Price prognostication) --- In order for your entry to be valid, entries will need to have a full answer to the QUESTION, in 30 words, OR MORE. <===== NOTE !!!
LET the CONTEST continue !!

Gandalf the WhiteSPOT and SPIKE give THANKS ---#1524842/23/07; 00:27:45

for the Roo Meat delivery from DOWNUNDER !!!
Get ready to ROCK AND ROLL !!!!

goldpuppyprice guessing contest#1524852/23/07; 00:33:51


Gold is still gaining support at $675 but I feel there are dangerous undercurrents gaining force in the global financial system and so may unexpectedly break out on the upside another $25 in the next week or so in the futures market.

USAGOLD / Centennial Precious Metals, Inc.Meet the SATURDAY Night DEADLINE for THIS PRIZE ! ! !#1524862/23/07; 00:34:31">gold Mermaid contest prize
GoldiloxJS comments#1524872/23/07; 00:58:35


There came a time in the late 70s where it became obvious that my extreme trading activity had maximized it's usefulness. At that time I reduced my sales on strength and increased my buying on weakness until finally maxed my position and sat back for the ride. Gold broke above $400 for the 2nd time and that was all the full sized lady sang. There are some signs that this time may be approaching again.

Stop looking for reasons to be wrong, which is the apparent hobby of the new crowd, and see the clear success you have waited for. I do not like the reasons why this will occur, but better to be on top of a rolling barrel than under it.

TopazFull Spectrum TA.#1524882/23/07; 04:11:50$gold:$silver&p=D&b=5&g=0&id=0

So, by the end of Mar or absolutely by mid-Apr we'd expect to be at (ballpark) 30:1 on the G:S Ratio.
How might this manifest in the current $Po's? lets crunch a few numbers.
If our new-found PaperTrading friends are proven right and PoG "corrects" here (the Commercials are "always" right, aren't they?) we might have over the next 4-6 weeks a 600:20 Au:Ag Ratio develop ...not beyond the realm of possibilities eh?
If OTOH our FSTA is proven to be correct, something of the order of 750:25 might be closer to the mark.

Scenario 3 figures the ratio won't adjust downward by anywhere near the assumed amount but I've ruled that out "completely" ;-)

mikalStealth bull market in gold, under the radar, beneath the noise#1524892/23/07; 04:27:05 Short Lived Economic Pessimism: Pollyanna is Back - With a Vengeance - Michael Panzner - SeekingAlpha - Feb 23, 2007
This concise summary of three recent examples of professional or high-level expediency and evasion from the EU and US, that make clear where certain corporate interests prevail or are sancrosanct. The true goal of "regulation" is beyond contrivances, artifice and nostrums.

TopazMexican stand-off.#1524902/23/07; 04:47:05

Yesterday PoG failed to react to a genuine softening in the Buck:Bond composite, tonight we're witnessing the opposite with BB (him strong hombre!) ....and "again" PoG/S is comatose.
Given the action/reaction earlier in the week where an attempt was made to whack PoG and answered by the $20 pop, I'm thinking they're too er, frightened, to sell it down for fear of initiating a really descent spike.

GoldiloxFriday Follies#1524912/23/07; 08:41:28

I was thinking, just as I retired last night,

"What if, instead of a Friday Spank-down", we saw a Friday short-squeeze, just for variety, and voila, here we be.

Off to the races? We just flew by my guess for next week.

Cometosedollar#1524922/23/07; 08:43:37

Looks like the dollar is being taken for a long overdue trip to the woodshed

It's been said this week that .8380 is support.

Spring Baseball is right around the corner .

Oil is going up .

Tension with Iran is riper and riper.

THIS IS A DUM_ TRAP .........

I bet there's a computer model doing some interesting
games relative to playing CHICKEN with IRAQ........


The military industrial complex likes having someone who is so pliable at the helm ......

For years we did a good job of staying out of it ...letting the major factions fight it out among themselves .......IRAN IRAQ war ..........
AFghanistan and Russia .....The oil companies like this
hubris which inevitably has made more powerful their place in the CORPORATE FACTION of shadow government .
Saudi's like the Protection ...
Munitions co's like the activity ...

The reprisals (which look like they are global with the sides lining up with CHINA and Russia backing IRAN in addition to other alliances )may be suprising .

I fear that while the UN sanctions IRAN for its' activity , we *US* will be on the recieving end of another set of economic sanctions that are at this time in the wings awaiting deployment .

The business in Iran Has large looming war implications.

Since ENERGY seems to be at the center of this game and the ILLUSION OF A SCARCITY IS upon us .........

maybe the wise thing to do EXPOSE THE WIZARD
and to diffuse tensions over ENERGY is for one of the major players ..............CHINA .........

to begin to produce an AUTO that with CARBURATION TECHNOLOGY that gets ........130 miles to the gallon ...

WITH THE PROFITS ,,,,,,perhaps they could buy the board of some media company and we could get more fair and broad perspective reporting on GLOBAL EVENTS .....

THE COMPETITION for the PREMIERE POSITION in POLITICAL LEGITIMACY as well as ECONOMIC LEGITIMACY might be easily won ........wisely before it is necessary to plunge the world into another GLOBAL WAR.

THE US seems to have fallen into the hands a group of POWER DRIVEN GREED DRIVEN GROUPS .....that always go back to the same damn REGIMEN .. It worked for the IMPERIALISTIC BRITISH ....before the fall of the POUND ...
LET'S GET A RUN FOR OUR MONEY WHILE THE SUN HASN"T yet set on the almighty dollar ........

THE same group run by avarice .......always comes out of the shadows takes over and does THEIR ONE TRICK PONY SHOW .
IT"S AN OLD STORY .........and BORING ....IT"S TIME the WORLD GETs past this nonsensical business and gets to the next level of civilizaion ...

Our way of life is being destoyed from within ....
THe dollar gets thinner and thinner .....
Our rights are being evacuated .....
because of terror (real or illusionary )
causing a state of war (rumor or real?)
to secure resources (scarce or bemused as such )

If there is a man out there .......who has the technology to make cars run to 138 mpg ...........
the CHINESE who have perhaps the most to gain (in improved lifestyle) might be wise to take in this man and his technology .......and donate that technology through transfer and distribute that technology to the world
and thereby unseat the boys who use resource scarcity
as a pretext for making imperialism live
and strike up the war machine

If they have that technology , they might not show up for this WAR ... THey also might not share that technology .

mikalHedge funds, prime brokers and the law#1524932/23/07; 08:53:11

The Bankruptcy Development That Has Wall St. Worried - Jenny Anderson - New York Times | Feb 23, 07
Regarding the recent court decision that will be appealled, "It poses a tough question for Wall Street. What does it need to know about it's clients?"

YGM$$$$695.25$$$$#1524942/23/07; 09:22:58

IMHO, Gold will most likely move into the $800.00 range in 2007. Geopolitical concerns, various CB's are already replentishing their Gold reserves, China and a few others are undoubtably quietly buying Gold. Those few (ie: Iran) who would wish the US dollar ill will would be prime candidates for helping push Gold higher. The buying in Gold always feeds on itself accross a very broad spectrum once it's renewed interest is on solid footing. Dubai is a good example being currently abuzz with Gold talk & buying interest like never before. Topping it off are majors like Barrick, cleaning out their hedgebooks. Lots of factors to consider when second guessing Gold's future prices, all positive and many previously unseen. It could just be that this time it "IS" different. I believe GATA has far more than it's fair share of credit due for the many years of raising the awareness on the reality of the rigged Gold markets and the games played for so long. USAGold can take a bow as well....YGM
GoldiloxRip rah ree, where is our cheerleading squad?#1524952/23/07; 09:34:54

32 entries in a free gold contest?

80 points up in 20 days?

Where are the pom-poms and rally chants?

Come on, "Gold Diggers", this stuff doesn't happen in a vaccuum.

Ya gotta bleeeve! Show some spirit!

"Rip rah reeze, hit 'em in the knees!
Rip rah rorts, hit 'em in their shorts!"

Oh Great Wizard, is the gold army under a sleep spell cast by some evil Witch of Wall St?

Goldilox80 points in 50 days#1524962/23/07; 09:36:15

Even I am having my senses dulled by the Evil one's spell!
Topazalt currency PoG.#1524972/23/07; 10:12:29

I'm sure todays action will see the Canuck thing burst through into the rarified air of multi-year high PoG, following Yen-san into that greenest of pastures.
Can the Swiss miss (or better "airswing") be far behind?
Then the Continental composite (aka "compost"), Greenspam, Ozzie bleeder, GB "miligram" (they're metric now) ...through you all go bumwipes, bask in the reality!

CometoseWar Premium #1524982/23/07; 10:22:09

Is beefing up in the GOLD market...........

It's interesting to watch the XAU and HUI unbelief(less than stellar participation) .

Cabal Participants in this HUI market are just as suppress oriented as in the GOld Market ........but perhaps more effective here

However it's not a conicidence that the drivers at the GOLD MARKET seem to be developing a long BENT for the weekends.......

since the shorts got their spanking in the gold pits wednesday , THE HUI just keeps on sauntering along not paying much attention ..not believing ...

I guess over the weekend , those institutions that have been holding back will have time to evaluate the costs of remaining inactive ..........

If this keeps up some are going to resort to taking their business out of the sector and exacting their returns from a more honest medium ....that isn't subject to the local manipulation .

I wonder if this is what ANOTHER was referring to when stated paper would separate from the metal ....

The false creation of a non confirmation in the Hui will not stop the metal .......Some of us will have to seek other means to garner our honest returns from the metal if these mining companies remain walking dead.

On the other hand , another outcome might occur , if the divergent behavior continues much longer.......

that being the GREAT CATAPULTING ACTION that occurs when
prices(HUI) veer too far off course from FUNAMENTAL METALS
action .....a BOOMERANG LAUNCH OF HUI AND MINING CO PRICES from underbought to overbought ......

Maybe the next place the FUNDS will go for action .....will be to oppose the shorts in the HUI SECTOR


Federal_ReservesYou have heard of the Supremes?#1524992/23/07; 10:28:51

Introducing the Subprimes!

STOP in the name of the law, before you break the bank.

Gandalf the WhiteREAD THE RULES !!! #1525002/23/07; 10:34:01

Sir Yukon Gold Miner --- The Hobbits think tha you should thank Sir Goldpuppy for the nickel to make both his and your POG Contest entry valid.
PS: YGM -- trying to give the Ol'e Wiz a bad time ?

Gandalf the WhiteResponse to Sir Goldilox --- <;-) #1525012/23/07; 10:43:38

I think that the movement from $604. in early Jan to the present $688. interim level, has numbed the minds of far too many of the "nonbelievers" and made them comatose.
WHILE true Goldhearts are realizing that, we and Toto are NOT in Kansas anymore !!
ENJOY to ride!

YGM$$$$695.2$$$$#1525032/23/07; 10:59:06

Gandy...Sorry about that old friend. I wouldn't want to have you send 5 hobbits after me. They'd demand 5 pennies back for the copper, instead of a nickel. (smiles)
YGM$$$$695.3$$$$#1525042/23/07; 11:00:49

OK that's fine. Spot likes the extra 5 cents!
Gandalf the WhiteBEAUTIFUL WATERFALL today !#1525052/23/07; 11:11:59

Sir Smeagol -- you should check out that pool at the bottom of the falls ! GOLDFISH !!

Sierra Madre$$$$692.1$$$$#1525062/23/07; 11:12:16

I have been in communication with an ET for the past several years and it (I have not inquired about its sexual preference) has revealed to me that the settlement price of the April contract on February 28th, will be $692.1 FRNs. The highest price for 2007 will be $1012.67 FRNs.
Rocky$$$$689.0$$$$#1525072/23/07; 11:21:55

Gold will rise into the $750's and return to the $725's. The cause? Inflation! Inflation is generally the result of increased demand against a steady or falling aggregate supply. The basic prescription against it is straightforward, at least in principle. Good monetary and fiscal policy is needed to support aggregate spending in a manner consistent as possible with the full utilization of economic resources. Simplistically, we can expect our current crop of verbose experts in Washington to continue their inflationary practices that drive the over printed dollar down, resulting in the rise of Gold.
TownCrierGold market 'inextricably changed'#1525082/23/07; 11:23:13

[] -- TWO years ago, David Davis, a gold analyst for Credit Suisse Standard Securities (then Andisa Securities), wrote a 55-page report called ‘The Future of Gold’. At the time, the gold price had staged a promising recovery from a low of $255/oz to around $430/oz. The gains represented a recovery but there was scepticism the gold price could travel much further.

According to Davis's report, however, the gold price would be $700/oz by December 31, 2008 increasing to $1,200/oz in 2015. History shows us now that even Davis was too conservative for 2008...

"Putting all the factors together we've got an inextricable change..."

...the astounding fact is that the world's primary production of gold has been in supply deficit, with minor exceptions, for the last 15 to 20 years. That means not enough new gold is being mined to feed demand. Take 1997 which recorded a primary gold supply deficit of 1,000 tonnes, said Davis. Why then the 20-year long gold bear slide?

According to Davis, secondary supply of gold from central banks filled the supply deficit. Today, this is changing as the difficulty of finding new primary supply increases. Geopolitical disorders and US dollar distress are other factors changing the playing field. For years, hopelessly convicted gold bulls have been talking (raving) about a runaway gold price. They could be right.

Perfectly respectable professionals, becoming emotional about the infamously fickle gold price, may appear unseemly, but the change in sentiment towards gold is broader than that...

Ian Cockerill, CEO of South African gold producer, Gold Fields, said he recognised the hand of professional investors in the recent improvement in the gold price. "You can see it happening. The gold price goes up and then corrects, but never to the level from which it came.

"Personally, I can see the gold price going significantly higher."

Like it or not, the volumes of newly mined gold are falling off a cliff, and so are the reserves to replace it. Of the 81 million oz in primary gold consumption, only nine million oz is being replaced by newly discovered gold.
Suddenly gold is sexy again ... Official sector gold sales are slowing, and fast. Of the 500 tonne/year quota on central bank sales to end-September, 2006, it's thought only 370 tonnes hit the market.
General funds are joining their emerging market counterparts in buying gold shares to mitigate against geopolitical, currency and other financial risks. The US dollar is tipped to weaken further. Equities are doomed. And there's no impact yet from China whose highly regulated gold market is being slowly liberalised.

^---(see url)---^

Speaking of China, that big consumer of physical gold has been on holiday this whole week.

What new fireworks may may their reentry next week bring?


TownCrierStrange bedfellows giving gold upward momentum#1525092/23/07; 11:44:50

(Globe and Mail) --

...Yesterday the price slipped $1 to $683.With all of the whipsaw action in the market lately, Bart Melek, senior economist at BMO Nesbitt Burns, thinks the recent price gains will be very tempting to traders looking to pocket some profits.

But over the next few months, Mr. Melek expects gold to climb.

"It takes very little imagination to envision gold north of $700 later in the year -- and we are very imaginative," Mr. Melek says.

The economist says that gold is moving because of an unusual conflict of influences:

On the one hand, investors are worried about a pickup in inflation after Wednesday's higher-than-expected consumer price index data in the United States.

On the other, the market is expecting the U.S. Federal Reserve Board to cut interest rates, which would in turn lead to weakness in the U.S. dollar.

Meanwhile, the bond market is not performing particularly well.

"The [gold] market is finding data to go where it wants to go and at the moment it seems to be up."

Mr. Melek points out that gold traders are not necessarily buying the bill of goods from the Fed.

...At Merrill Lynch Canada Inc., analyst Michael Jalonen points out that lots of the recent buying has been spurred by the citizens of China, who have been welcoming newborn babies with a gift of gold.

The Chinese New Year on Feb. 17 marked the start of the Year of the Pig. Since this will also coincide with the year in which gold passes through the Chinese zodiac for the first time in six decades, it is also being called the Year of the Golden Pig.

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

A great custom -- babies EVERYWHERE ought to be welcomed with a gift of gold, to help them get their lives started on the right foot. Imagine the lasting psychological impact that will have when those youngsters reach the age of self-identity and begin asking their parents about their various baby pictures and mementos. Forever a gold accumulator/saver he or she shall be.

Again, China's gold market was on holiday this week. How many babies were born, and what will next week bring?


TownCrierGold turns hot cake in city of gold#1525112/23/07; 11:50:33

IRIS (23 February 2007) -- According to World Gold Council's regional office in Dubai, sales in UAE increased by 53% during fourth quarter of 2006 as compared to the same period in 2005.

This is the most remarkable growth in a quarter during past couple of years. Usually the growth has never gone beyond 25%...

" must be mentioned here that UAE is also known as the country with highest per capita gold purchases. While the per person consumption of gold is a measly 0.5 grams in China, and just above 1 gram in India, in UAE it is over 30 grams", said Shailendra Kumar.

UAE buys more than 2 grams gold for every one thousand dollars of its GDP, the highest in the world; even Germany doesn't buy more than 0.5 grams.

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

Measured in ounces or grams, are you keeping up, or are you falling behind in the "wealth race"?


Peculium Aurum$$$$718.00$$$$#1525122/23/07; 11:51:44

Well, Saint Patrick's day is just around the corner and all the little people are doing there best to fill their pots of gold to the rim. I still have quite a ways to go to fill my pot.

China and India having an unquenchable thirst for gold and with these two
most populated nations on earth seeing their economy expand rapidly , their ability
to purchase will put an upward pressure on the price of gold that may continue for years.
Couple that with the world wide "Inflate to infinity fiat theory of economics" (ITIFTOE)
And we may find out that even the great soothsayer of gold , Mongambo , has been understating future price of gold.

With that my prediction for the year end price of gold at $788 with a peak around $830
Now the big one, the COMEX CLOSE $$$$718.00$$$$

Placer Gold$$$$ $708.8 $$$$#1525142/23/07; 12:13:05

Based on the inherent fragility of fiat currency, gold ought to be at around $4000/oz. But by the time it gets there it ought to be even higher because the paper money will have deteriorated further. As long as the devaluation of the key world currencies remained relatively slow and regulated, smart money didn't need to consider gold because huge profits could be made within the currency markets themselves and those profits could be reinvested in the game to make more profits. But once the dikes break, what good is it to hang on to any country's watered down money? At that time I think more of the paper profits will be converted to gold, a certain store of wealth and also a form of money which will ride out the flood. I think that is happening now in a nascent way.

Placer Gold

Quickbeam$$$$ $692.5 $$$$#1525152/23/07; 12:22:49

I think the spot price of gold will make it to 850 this year. Of course, all of the geopolitical reasons are there as well as increased CB buying/holding, etc. More up close and personal for me, however, was what my daughter told me yesterday (she'll be 10 soon). She told me she just saw a commercial on TV about how to invest in gold.

Also, this past holiday season, my local news (Washington D.C.) area covered a story about how someone had put a 1 Oz. gold coin in the Salvation Army pail instead of "money". They noted that the coin was worth well over $600 dollars.

Once a wider public audience starts seeing more of these stories and commercials along with wider coverage by news media, the POG will only benefit more.

Rimh$$$$$$$ 705.2 $$$$$$$#1525162/23/07; 12:30:58

The highest spot price this year may well be $800+. If I had to pick a number out of thin air, I'd say $875. It could easily be higher, much higher. At this point in the game, no one is sure how much control the CB's have left in them but it seems evident they are losing their grip and/or forcing the US out into the open with their "strong dollar" policy. The only potential hold-up in a big price run up is the on going efforts by China and other nations trying to get rid of as many US dollars before the price is "revalued" over a weekend. It would seem from reports, though, that China has been able to unload a great deal of US dollars already by making numerous deals with poor countries in Africa.
Federal_Reserves$$$$ 2007.00 $$$$#1525172/23/07; 12:37:29

We are on the verge of a major war in the Middle East and when it breaks out with IRAN gold/oil will skyrocket. What's happened in IRAQ to date will look like child's play when the big one starts. The credit bubble is bursting - Subprime and mortgage defaults abound. While Wall Street fat cats party on and invest their big bonuses into the stock market driving it higher and higher on margin debt the rest of the economy is rotting away. Home, Auto, Durable goods sales are tanking. Unemployment except in the armed services is going sky high. The US dollar is going to melt and rich folks are going to panic and rush into the only really safe asset class - GOLD! It will be called the RICH MAN'S PANIC of 2007.
xyloForgot Year High in my contest entry - $$$$863.0$$$$#1525182/23/07; 12:40:31

Re-reading my contest entry this morning I noticed that I gave my guess for the end of year closing, but forgot to mention my guess on the high for the year of $$$$863.0$$$$.

Hope it's not too late to make a correction to validate my entry!

mikal(No Subject)#1525192/23/07; 13:07:50

Gold producers hedge less as prices hit $700
Laura Mandaro, MarketWatch
Last Update: 2:01 PM ET Feb 23, 2007
SAN FRANCISCO (MarketWatch) -- Excerpt: Confident that sub-$300 gold is a bogeyman of the past, miners of the precious metals are increasingly doing away with hedging contracts designed to insure against a drop in prices.
Producers reduced their hedging positions by 25% last year, the sharpest drop in at least five years, to 40.2 million ounces, said a study published Friday by Mitsui & Co., London consultancy Virtual Metals and Toronto-based consultant Haliburton Mineral Services.
Taken another way, dehedging totalled 13.4 million ounces, or more bullion than European central banks sold last year.
Miners have been shying away from using financial instruments like forward contracts, which act as agreements to sell gold at a certain price in the future, to manage their gold sales. These contracts protect them from a drop in prices -- but don't work so well if prices go up.
"While dehedging in 2007 is not expected to be of a similar magnitude to what it was in 2006, little appetite exists for new hedging," said Edel Tully, head of precious metals research at Mitsui's Mitsui Global Precious Metals, in a statement.
On Thursday, Barrick Gold Corp. said it had completely eliminated its corporate hedge book and planned to eliminate its remaining floating spot price contracts by the end of the second quarter."
Mikal-- I'm SO relieved "that sub-$300 gold is a bogeyman of the past". Aren't you?
Miners no longer look a gift horse in the mouth.
It even looks as if they're digging in their heels and renouncing future hedges.
Digging deeper, there's more here than meets the eye
of course- that analysis goes to those more grounded in these things.

Prius$$$$695.5$$$$#1525202/23/07; 13:18:38

I think it most likely that gold will reach $900 this year. It could be much higher as many respected members of this forum have pointed out. The reasons are simple: War and Debt. The US economy simply cannot continue to appear ok when the leadership of our country fails to lead. In a dog pack, the "followers" will never follow an unstable leader. Perhaps we could learn a few things from the dogs.
Gandalf the WhiteThe POG Contest "King of the Hill" report !!! <;-)#1525212/23/07; 13:32:56


Friday 2/23/2007
GOLD COMEX April 2007 Contract (GCJ07)



$$$$ $687.8 $$$$ Lebieque (2/15/07; 03:55:18MT - msg#: 152174)

The present KING OF THE HILL is: ===> Sir Lebieque !!

GoldenBear$$$$ 693.9 $$$$#1525222/23/07; 15:01:12

I beleive gold will be in the 700 this year at least, but i hope it can make it to 850. I may even convince my husband to sell some of it if it does get there. Fingers crossed!
Cometose****$698.00****#1525232/23/07; 15:30:31

I am sure that the price of Gold will reach $844 this year because

THE ROADRUNNER HAS EATEN THE COYOTE'S CABBAGE......... again. The charlatans have been exposed and are now going to begin to receive the spanking that is due them ....

their wages are due ......AS THE PENDULUM SWINGS.....

NOTE: It is rumored that Mises School of Economics has opened CAMPUSES in BEIJING and BOMBAY.

Jack BE NIMBLE couldn't be NIMBLE because he got STUCK IN


Clink!$$$$ 686.0 $$$$#1525242/23/07; 15:34:48

We all look at charts of PoG progress, whether temporal or P&F. The standard ones show a mostly smooth curve all the way back to the beginning of 2001, but they plot on a linear scale, which doesn't allow you to see if the rate of increase is itself increasing or decreasing. This is obviously of key importance as the standard of measure, the dollar, is itself losing value at a certain rate. Further, of real importance is not the maximum value that gold might attain, but the level of the rising floor under the market, below which it is very unlikely to go. So I grabbed the P.M. Gold fixes from the LBMA since 2001 and plonked them in Excel. Plotting them against a log chart allowed me to see that :-

1/ The rate of increase of the PoG floor was amazingly consistent all the way from Jan '01 to Dec '05, with just a small dip in mid '05 as it meandered for what seemed to be an eternity.
2/ The massive rise from then till May '06 led to a blow off top and pennant oscillation which lasted until the end of this January.
3/ The floor re-established after the blow off was both at a much higher level than a continuation of the '01-'05 line (which would put a floor of $600 at the end of this year, while the current floor is already around $630), but has a much steeper slope, representing around a 34% annual increase. If the new floor holds (it only has about 4 months of data to support it so far, so that is still a big IF (although a pleasurable one to contemplate, nevertheless !)), this would mean a minimum of around $810 at the end of the year.

And a high price ? On May 12th '06, the $725 fix was about $235 above the floor. This would give a potential (without breaking any previous performance records) of $1,200 this year.


Survivor$$$$$707.7$$$$$#1525252/23/07; 15:49:05

Give or take a major world event or two, the value of gold has held steady during the US dollar bear run this decade. On the other hand, the relative purchasing power of the US dollar (and other fiat currencies) has eroded at a quickening pace, especially during the last year or so. This accelerating fiat erosion has contributed to the attractiveness of gold at every level from central banks to individuals. There is increasing demand for the metal at the same time mine output is down. There is likely to be new upward pressure on the value of gold in real (non-fiat) terms.

With the price of gold expressed in ever-devaluing US dollars, and demand for gold on the rise, it is reasonable to expect that spot prices expressed in US dollars will dance in the $800-$900 range before 2007 is over. Toss in widening military action in the middle east, or a sudden shock to the monetary system, and that range could double or triple quickly.

- Survivor

slingshot$$$$$$$$$ 698.8 $$$$$$$$#1525262/23/07; 16:42:52

The price of gold for 2007 will rise to $975 an ounce.
There will be plenty of VOLATILITY. The Dollar will be defended till it is overwhelmed by the worlds central banks and their slow repudiation of it. There are too many Players in this Game of Greed where new rules are made up at whim to continue the game. Iran,Iraq, Housing,Debt,Oil Inflation and Gold are some of the game pieces on the board.

milkhon$$$$ 694.0 $$$$ milkhon#1525272/23/07; 16:57:44

The POG will reach a high of 744.00 during 2007. After flirting with new highs there will remain downward pressure as factors keep gold from breaking out. There is basic strength so I don't expect it to drop to far unless the general market starts a correction during the year..
otish mountain$$$686.9$$$#1525282/23/07; 17:20:44

Well if the increased volatilty in POG this week is any indication of things to come I would hazzard to put a guess of $875.00 for the year high spot price for gold.
Now I say "hazzard to guess" because who knows for sure. If gold reached $3,000.00 or even $30,000.00 this year would anyone who has followed this board for any lenght of time be amazed at the price? Or would we be more amazed at the cascading rate of change in the price over such a short period of time?

slingshotSir Smeagol#1525292/23/07; 17:27:01

You can always borrow my slingshot but you will have more fun with my trebuchet. Although the element of surprise is lost with a larger projectile, it sure is fun watching them run as they see it in mid flight.


solosza$$$680.50$$$#1525302/23/07; 18:18:02

i believe gold will test the $750 range by eoy. all of us who frequent this wonderful discussion forum know that it should be much higher than it is now or what it will be by the eoy. i believe the PTMB will continue to push the fed to run the printing presses relentlessly until the once mighty dollar falls flat on her @$$! which in turn will catapult "our precious" to never seen highs! so to all of you newbies who are still not sure about converting a good amount of your savings to gold, as sir goldilox said in an earlier post "I do not like the reasons why this will occur, but better to be on top of a rolling barrel than under it."

$$$$$$$$$$$$$$ THE FEBRUARY 2007 "PRICE of GOLD" GUESSING CONTEST!! $$$$$$$$$$$$


Entries as of DAY #9 -- (2/23/07) at just about 18:18 Denver time !!!

Listed in order of decreasing values !

$$$$ $2,007.0 $$$ Federal_Reserves (2/23/07; 12:37:29MT - msg#: 152517)

$$$$ $1,250.0 $$$ Beamer (2/21/07; 23:42:07MT - msg#: 152436)

$$$$ $775.5 $$$$ Sprout (2/16/07; 18:42:09MT - msg#: 152256)

$$$$ $742.0 $$$$ Caradoc (2/22/07; 21:41:15MT - msg#: 152475)

US$730 (HK$5,694) 2- 22- 2007 -- Gold will touch --per ounce this year, according to William Lee Tak-lun, president of the Chinese Gold and Silver Exchange Society.

**** $727.5 **** Thoreauly (2/17/07; 07:46:31MT - msg#: 152267)

$$$$ $725.0 $$$$ Armageddon (2/22/07; 21:30:39MT - msg#: 152473)

$$$$ $724.6 $$$$ Topaz (2/15/07; 04:55:38MT - msg#: 152177)

$$$$ $718.0 $$$$ Peculium Aurum (2/23/07; 11:51:44MT - msg#: 152512)

$$$$ $715.2 $$$$ Boxman (2/22/07; 18:16:35MT - msg#: 152469)

$$$$ $711.7 $$$$ Tevye (2/21/07; 19:50:55MT - msg#: 152424)

$$$$ $708.8 $$$$ Placer Gold (2/23/07; 12:13:05MT - msg#: 152514)

$$$$ $707.7 $$$$$ Survivor (2/23/07; 15:49:05MT - msg#: 152525)

$$$$ $705.2 $$$$ Rimh (2/23/07; 12:30:58MT - msg#: 152516)

**** $701.7 **** goldpuppy (2/23/07; 00:33:51MT - msg#: 152485)

$$$$ $701.5 $$$$ Pal (2/20/07; 09:17:37MT - msg#: 152369)

$$$$ $699.1 $$$$ 24karat (2/22/07; 22:14:38MT - msg#: 152477)

$$$$ $698.8 $$$$ slingshot (2/23/07; 16:42:52MT - msg#: 152526)

**** $698.0 **** Cometose (2/23/07; 15:30:31MT - msg#: 152523)

$$$$ $695.5 $$$$ Prius (2/23/07; 13:18:38MT - msg#: 152520)

$$$$ $695.3 $$$$ YGM (2/23/07; 09:22:58MT - msg#: 152494)

$$$$ $695.0 $$$$ Sundeck (2/16/07; 04:38:24MT - msg#: 152221)

$$$$ $694.0 $$$$ milkhon (2/23/07; 16:57:44MT - msg#: 152527)

$$$$ $693.9 $$$$ GoldenBear (2/23/07; 15:01:12MT - msg#: 152522)

$$$$ $692.5 $$$$ Quickbeam (2/23/07; 12:22:49MT - msg#: 152515)

$$$$ $692.1 $$$$ Sierra Madre (2/23/07; 11:12:16MT - msg#: 152506)

$$$$ $691.2 $$$$ glockmaster19 (2/22/07; 16:35:32MT - msg#: 152464)
$$$$ $691.1 $$$$ Tin Man (2/21/07; 20:08:52MT - msg#: 152426)

$$$$ $689.0 $$$$ Rocky (2/23/07; 11:21:55MT - msg#: 152507)

$$$$ $688.0 $$$$ Goldilox (2/16/07; 11:26:32MT - msg#: 152238)

$$$$ $687.8 $$$$ Lebieque (2/15/07; 03:55:18MT - msg#: 152174)

$$$$ $686.9 $$$$ otish mountain (2/23/07; 17:20:44MT - msg#: 152528)

$$$$ $686.0 $$$$ Clink! (2/23/07; 15:34:48MT - msg#: 152524)

$$$$ $685.0 $$$$ Toolie (2/15/07; 03:10:40MT - msg#: 152170)

$$$$ $684.8 $$$$ Freedom (2/18/07; 13:37:59MT - msg#: 152295)

$$$$ $682.4 $$$$ Wheelthru (2/20/07; 15:01:11MT - msg#: 152382)

**** $678.0 **** Rook (2/17/07; 19:55:35MT - msg#: 152278)

$$$ FRN677.7 $$$ Smeagol (2/22/07; 21:36:03MT - msg#: 152474)

$$$$ $676.5 $$$$ pilgrims_gold (2/22/07; 16:47:36MT - msg#: 152465)

$$$$ $675.1 $$$$ xylo (2/20/07; 13:21:27MT - msg#: 152379)

$$$$ $673.5 $$$$ Lothar of the Hill People (2/17/07; 13:25:18MT - msg#: 152271)

**** $670.0 **** Liberty Head (2/17/07; 10:03:22MT - msg#: 152270)

$$$$ $666.6 $$$$ Minero (2/17/07; 07:39:45MT - msg#: 152266)

$$$$ $663.8 $$$$ Flatliner (2/22/07; 23:02:49MT - msg#: 152479)

$$$$ $662.5 $$$$ Henri (2/16/07; 11:02:33MT - msg#: 152235)

$$$$ $662.1 $$$$ balzac (2/22/07; 09:35:46MT - msg#: 152446)

$$$$ $658.0 $$$$ flow5 (2/15/07; 12:19:26MT - msg#: 152184)

$$$$ $647.1 $$$$ smiles45 (2/21/07; 21:26:01MT - msg#: 152431)

Gandalf the WhiteGOT ya Sir Solosza#1525322/23/07; 18:25:49

Keep them coming until Midnight tomorrow !!
12UP Saturday eve, February 24th is the DEADLINE !!!

GOLD FINGER$$$$680.00$$$$#1525332/23/07; 18:55:27


What do you think the highest SPOT price of gold (POG) will be this year.....? $800.00

WHY?? The 50,000.00 question!

2007 for better or for worse will be another turbulent year for gold. I am not overly bearish or bullish. I do see a few factors making an impact as we can see it now having an effect on gold.

Calendar predictions of this year of the "BOAR" pegged metals to NOT be overtly ready as in the past. Perhaps we can see how sometimes these traditions are wrong. I can base my prediction for the highest price of the year on several factors that seem constant.

1. The dollar will decline further, due to our huge financial mismanagement.

2. The wars will not stop. Both seem rather persistent and both are determined to win. This spells disaster and gold wins in either case.

3. China and India love gold and will continue to buy if not hoard it.

4. OIL this little break we see here in the price was to just take the heat off....well, you know who!!

The number one national security issue is.....ENERGY! Since we need it and since we have no big fuel alternatives, it is only pegged to go HIGHER! Oil goes up and so will gold. Oil goes seems to hold! Just an observation.

5.I think it was Sir Armageddon who mentioned something about the "Last Days"? Well, weather or not Nostradamus or any other prophet has any wise information here we all can see that it might not be the wars that bring us into the world's last days.

War might be a by-product of this occurrence. What I am talking about here is something we ALL contribute to, and that is GLOBAL WARMING. If our environment is so incredibly fragile and Ice caps are melting and weather conditions are changing and effecting the earth's atmosphere, consider for a moment what all these nuclear bombs that have been tested have done to our good ole planet earth? How much more can Mother Earth take?

Predictions and Gambling seem to go hand in hand. I am neither a prophet or a gambler. I go with my GUT! If gold's ultimate price increases hinge on the unforeseen world disasters or other situations, for me what we see on a daily basis is more important than trying to predict the highest price for the year. Gold's price climb these last few days tell a story. I think it's being written before our eyes.



R Powell $$$$$$ 668.8 $$$$$$$ #1525342/23/07; 19:22:48

"What do you think the highest SPOT price of gold (POG) will be this year, AND, in thirty words or more, Why????"

Price prediction is, at best, mostly luck. Price direction is the goal. But thinking that silver may peak somewhere just under thirty if a bit of fund mania catches wind under her, then the POG could easily peak at $1200. Why? My kids won't even bother to pick up change (coins) off the ground while growing up (still don't, I still do) and the minimum hourly wage when I started working won't even buy a cup of joe today.

SmeagolSsir Slingshot#1525352/23/07; 19:25:53

Ssss! a TREBUCHET! =8-) O Yesss! Close is good enough with one of those (cackle)!

Very effective, yess precious... esspecially considering, that yellow glint we sees in the counter-weight box! ~9-)

phil288$$$$$$$696.2$$$$$$#1525362/23/07; 19:41:14

I believe the dollar will depreciate in value until it will take $1000 of them to acquire an ounce of gold sometime in 2007. Volitility is the name of the game and while the dollar may not close the year that low it will definitely hit that level as Middle East pressures, internal and external debt issues, oil supply problems and internal political games depress the U.S. currency. Gold is after all the benchmark upon which all other currencies are measured and the dollar could be especially vulnerable in the coming year. Whether inflation or deflation or some combination is our fate, getting physical while there is still time, and here is as good a place as any, will yield the best outcome. Got gold.
FreedomClink ! #1525372/23/07; 19:51:51

While reading Sir Clink's message number 152524 ~ it occurred to me that Clink is a mathematical artist. If you visualize him on his back, on top of high scaffolding, painting the ceiling of the dome inside the castle ~ you'll get a far better picture of what he's saying.

He breaks out his brushes (Excel) and sets to work painting. Today we find him painting a floor at $630. Lower, to his left, we see a previous floor where he painted an object (a burned out Chinese fireworks Roman candle) that had a blow-off top at $725. Sir Clink paints along the floor, coming to his pennant oscillation (these are dancers at The Kings Ball) and after the Ballroom scene he begins painting new support beams, $640 then $660, to hold an even higher floor.

I see, judging by the size of the dome, this painting could take years to finish. Thank you Clink, for your mathamatical illustration.

Waverider$$$$$ 710.50 $$$$$#1525382/23/07; 19:53:12$GOLD&p=W&b=3&g=0&id=p64126949554&a=38522465

Hey Sir Gandalf!! I see that our gracious HOST is having another Price Guessing Contest......YAHOOOOO!! Above is my humble guess. I think that the HIGHEST price in 2007 will be $$$$$$ 819.00 $$$$$ As per my link, we seem to have just broken out of a symetrical triangle and I get a price objective of $819.00 by adding the length of the base of the triangle to the point of breakout. There's also a nice MACD cross-over. By P&F charting, (your FAVORITE), I get a PO of $790.00 with Gold having recently made a triple top breakout. I'd rather be OPTIMISTIC and guess the higher number. Are you recording these guesses and going to let us know who was closest? Cheers,

Lady Waverider

cinksl4gold poll#1525392/23/07; 21:30:59

$$$$ 652.0 $$$$ There is a school of thought that the price of gold could go much higher here, in order to price itself out of the reach of the average gold consumer. I am hoping it does not, and stays in the 600's for the rest of the year so we might be able to buy more 'flation protection.
smiles45Where' our Gold?#1525402/23/07; 22:43:31

Rob Kirby has a very important essay this week. A few weeks ago a phrase "deep storage" was referred to in an audit(but not signed off on)on the Treasury gold stocks. Really the audit just reads documents and forms and made NO physical inspection of the bullion.
Mr Kirby makes a point that deep storage ( a new terminolgy in gold storage) refers to gold in the ground not yet mined. Through tricky in wording the U.S. has been able to avoid an actual physical country for decades.One might think a government owning 8,500 metric tons of gold might want to advertise that figure. Especially since their fiat currency has serve devaluation.
The problem is if the gold is in the ground does the US government have a prior claim over the shareholders?
"This raises the question as to the veracity of Treasury's/Fed's claims to possess physical gold. It raises questions as to the make up of any gold held on the books; is it custodial - if any is physically present at all - or is it simply paper promises? If one supposes the Treasury does not have any physical gold inventory and, in fact, has swapped promises to deliver gold at a future date – this could pose a systemic problem if miners’ collective ability to produce gold over a given time period was exceeded by Treasury's promises to deliver.

Such a case would beg the question; who really owns gold all the gold being mined then? I would suggest that all of the gold currently being mined in much of the world – might possibly have been sold twice. That would quite possibly infer that at least one class of owners has actually been sold a bill of goods [or down the river, perhaps?].
Gata for years has suspected that over half our Treasury gold bullion was missing or leased out and sold in the market. To whom you may ask. U.S. monetary authorities have confiscated their nation's gold in the past. This is a fact."
And here we thought were were safe by owning PM shares and ETF's for the coming financial fiasco. These buggers have garnered every oz for themselves and then proceeded to buy as much as they can with their paper debt and FRN currency. Welcome to the 21st Century! So the only safe individuals are physical coin holders in the end. One problem with is they might enact stringent reporting restrictions or call them in. In that case where to people sell? I am sure we can all figure enough prime suspect from our leaders past and present./Peter

GoldiloxGold Commentary#1525412/23/07; 22:53:34


"People who shut their eyes to reality simply invite their own destruction, and anyone who insists on remaining in a state of innocence long after that innocence is dead turns himself into a monster."
--James Baldwin Biography - Fiction Writer, Essayist, Social Critic, 1924-1987

Dear CIGAs,

As we discussed last evening, gold is discounting both the obvious as well as the opaque. The economic factors outlined in the Formula are lining up as if they had a calling to perform. You might review the comments concerning the duration of the equity bull market and its dependence on continued earnings growth. Liquidity has made the bull equity and continued growth of earnings is required to maintain this ebullience.

I would classify the Formula as the obvious. I would consider geopolitics as the opaque. You might recall my comment when crude was trading intra-day below $50. It not only was cheap but it was a geopolitical gift.

The world is walking on eggshells as major powers choose allies. Iran keeps thumbing their nose at the West with Russia standing directly behind. China is tying up raw materials worldwide. Iraq is beyond repair.

The next shoe to fall is in Afghanistan where spring will bring a surprise even to those that anticipate a more powerful, trained, effective Taliban. Afghanistan will reach the degree of violence that exists in Iraq but between the Taliban, Taliban Allies from outside of Afghanistan and whatever of NATO remains.

As you can see, the British are stepping up their presence as others become reticent to do so. Some NATO members are considering reduction. The extreme growth of the Afghanistan conflict is the next wound to be inflicted on the British and the US in the standard operating practice of Middle East War. It is the bleeding process that the USSR could not stop that caused them to retreat out of Afghanistan and was one of the major links in the chain leading to national bankruptcy.

This time around it is the West that is in the cross hairs of a geopolitical chain of events leading to its bankruptcy. The risk that is being discounted by the gold market is that strong military nations facing economic crisis will use their strength indiscriminately to seek ways out of the assembly of problems. This causes the risk of nuclear proliferation to become extreme.

So it is logical to assume that the gold market will also become extreme.

I do not feel you can be long gold and be wrong unless you are margined. There will be many instances where the bucking bronco of the gold price tries its best to throw you out of your position. Late afternoon today could be an example. If you are margined you become the effect of others actions in the market. If you are without borrowing you are your own master. Be masterful on your way to success.

COT will take a stand, but not here. $690 was close enough for a Friday liquidation of longs but only that. The block will be thrown just above April gold at $700. I do not believe it will be successful as $761 is where this phase of the bull wishes to go.

Precious metal shares will perform because they cannot and will not be ignored. This will come as general equities and the bond market becomes less attractive and appreciating gold is a beacon for direction of large stores of available liquidity looking for a home. It will occur.


Market manipulation works so well as long as the story "sells". Look to the ENRON and bubbles for great examples.

Then Greenspan extended the housing bubble by exhorting the great unwashed to enter their homes and savings into the high risk "adjustable rate" crap shoot.

But the grand-daddy bubble of them all is the "strong dollar policy" whose only remaining proponents are the military suppliers and oil Czars who have skimmed the life blood of both the resource nations and the western consumer simultaneously for two decades of continuous rule by the Bushistas (Clinton included).

That bubble is now threatened by the lack of willingness to sustain the Ponzi scheme. The cracks in the dyke are almost too many to mention and definitely too many to "repair". Got your golden "water-wings"?

In the immortal words of Bill Cosby paraphrasing the Almighy's message to Noah, "How long can you tread water?"

Goldendome$$$$$$$ 690.10 $$$$$$$$#1525422/23/07; 22:55:15

Credit problems in the real estate market, combined with rising interest rates will lead to a credit crunch and a lower dollar in the currency markets, dollar down – gold up. A serious deterioration in the economic numbers could force a late year interest rate cut. Again – good for gold. Excluding war with Iran, I'll say gold goes to an $855.00 high this year. Hostilities with Iran? Gold will go higher depending on the overall damage.
GoldiloxWho's driving this bus?#1525432/24/07; 00:18:29


Elsewhere, the recent G-7 meeting at Davos, Switzerland revealed that other leading figures are getting seriously concerned. Never one to mince words, the Financial Times’ Gilliam Tett quoted ECB President Jean-Claude Trichet as stating that "current conditions in global financial markets look potentially 'unstable.'" According to Tett, Trichet went on to suggest that investors "prepare themselves for a significant 'repricing' of assets" with Trichet noting that "the recent explosion of structured financial products and derivatives had made it more difficult for regulators and investors to judge the current risks in the financial system." Noted Trichet, "We are currently seeing elements in global financial markets which are not necessarily stable," with Trichet pointing to the "low level of rates, spreads and risk premiums" as factors that could trigger a "repricing." Trichet concluded his remarks to Tett stating that "There is now such creativity of new and very sophisticated financial instruments that we don't know fully where the risks are located. We are trying to understand what is going on, but it is a big, big challenge."

Ok, now I don't know about you, but if he is the President of one of the worlds largest Central Banks and he doesn't get it, ... Ah… where does that leave the rest of us? All of which brings us back to the DJIA and S&P, and the constant chorus of euphoria resounding through the hallowed halls of Cable TV where ‘in depth’ coverage often means nothing of the sort.


Frank Barbera's market wrapup from Tuesday last. It seems especially poignant only a few days later.

mikal(No Subject)#1525442/24/07; 00:22:00

US Mortgage Crisis Goes Into Meltdown by Ambrose Evans-Pritchard | Business | Money | Telegraph - Saturday, February 24, 2007
A one-page article ties together quotes from Noriel Roubini, Peter Schiff and others.

smiles45Where's our Gold?#1525462/24/07; 00:34:24

This presentation would be best made by Mr. Chris Powell of Gata.For many years Gata have suspected and in many cases proved the US gold depositories Ft. Know, West Point and Denver were devoid of what the US Treasury has claimed. No physical audit has beed performed in decades. One would imagine a country with problems with it's paper currency would want to brag upon rooftops of it's vast hoard of 8,900 Ton of bullion.
Mr Rob Kirby has done a further hunt for the socalled "deep deposits" named on the last paper audit. What is becoming painfully clear these deep deposits are not in fact our bullion, but bullion yet mines. The issue of mines nationalization comes to mind with the onus on the present PM issue shareholders.
This is well worth examining carefully. Reference to ETFs as cash cows for govts out of control are scary to say the least. This could leave gold investors of ETFs and mines shares in the learch. We know bullion in hand is probably the safest and best way to retain wealth, but with a govt that has a 2x record of confiscation of gold is not a pleasant though. A govt so eager to denude us of the Bill of rights can and will do almost anything.
The well known concept of a cashless society is another problem. If that occurs who does one buy or sell to?? A 2-tier system one for govt (with gold) and one for the people forbidden to own gold. The variable are numerous. Where are poster Belgium, Another and FOA when you need massively important advic? I quote Mr Kirby below
"The Very Deepest of Do-Do

So what does all of this really mean?

If the Treasury's gold reserves are, in fact, ‘yet to be mined’ or deep storage gold - this has ENORMOUS implications for the gold equity markets. If significant amounts of ‘yet to be mined gold’ have been sold forward by the Fed and/or U.S. Treasury – this raises SERIOUS questions as to priority claims on yet to be mined gold. Specifically, would any Fed or Treasury claims [via swap agreements] pre-empt gold company equity shareholders?"

I invite all opinions and remedies/Peter

smiles45Sorry for the poor typing and grammar#1525472/24/07; 00:38:25

Hope the post was helpful anyway/Peter
Topaz@smiles45#1525482/24/07; 00:47:21

The term "deep storage" as I recall was first mooted approx 6 yr's ago coincident with South Africas move to "nationalise" their in-ground ore deposits. You MAY recall the Rand was headed to zool around X'mas 2001 I think and suddenly reversed on the announcement of same ..and hasn't looked back.
Black Blade$$$$696.70$$$$#1525492/24/07; 00:56:38

I see the price of Gold breaking the all-time high this year pushing well over $850/oz. I would not be at all surprised to see the price rocket to $1,000/oz before year-end. Nothing has fundamentally changed as we are still burdened with the "twin deficits", depreciating currencies, and now an imploding real estate bubble with ripple effects in the banking and credit sectors. We are just beginning to see cracks appear that suggest the Federal reserve is losing their grip to to a lid on their definition of what is "inflation".

Worldwide people from Asia to the Middle East to the E.U, to Latin America to North America are reallocating their wealth into hard assets. They are skittish and ready to bolt to Gold and Silver. The world is an ever-more unstable place where the slightest spark can trigger geopolitical and economic upheaval. Gold and Silver have a history of being a store of value that spans over 6,000 years.

One small act that threatens the world's oil supply can easily be that trigger. The world's major oil fields are in decline and no new ones have been discovered since 1976 (Cantarell Mexico being the last). More costly small fields and unconventional oil and gas production is making up the difference for declining production from the major oil and natural gas fields around the world. A way of life is being threatened and that uncertainty will ripple through the global economy like a tsunami. Few assets like the precious metals are best positioned as "portfolio insurance" for wealth preservation.

As always, get out of debt and stay out of debt, stash enough cash for several months' household expenses, accumulate Gold and Silver portfolio insurance, and start a storage program of nonperishable food and basic necessities.

We live in "interesting times".

- Black Blade

Gandalf the WhiteYES ! Lady Waverider ---- <;-)#1525512/24/07; 01:51:36

GREAT to see you posting again !
AND Sir Black Blade too !!
NOW the competition is heating up !!!

Gandalf the WhiteTAA TAA TAAAAAAAAAAAAA, ---- LAST POSTING !!!#1525522/24/07; 01:55:13

$$$$$$$$$$$$$$ A "PRICE of GOLD" (POG) GUESSING CONTEST!! $$$$$$$$$$$$

We shall have a price guessing contest on the closing (Settlement price) of gold for the April COMEX Contract (GCJ07) on the last day of this month. Wednesday, February 28, 2007, ---BUT all entries must be posted to the TableRound before Midnight on Saturday, February 24th, AND ALL ENTRIES must answer "THE QUESTION" !!

Based on numerous prognostications from both recognized metals industrial companies executives, financial "experts", taxi drivers, and "idiots" – that the price of gold this year will be somewhere between $500 and $2,000,
the QUESTION is:

What do you think the highest price of SPOT gold (POG) will be this year, AND, in thirty words or more, Why????

This POG Contest winner -- the closest price guess to the actual Settlement Price -- will receive a rather rare collectors piece, a Danish 20 Kroner goldpiece, having the likeness of King Christian IX on the obverse, but commonly known as a "Mermaid" for the content of the reverse side of the coin !

The "Mermaid" 20 Kronor goldpiece had a total mintage of only 1.5 million, as compared to the nearly 110 million mintage of its period cousin, the English Queen Victoria sovereigns. It gets its name from the blend of a stoic Lady Liberty, enthroned with what I think is a porpoise or dolphin, swimming at her feet. Christian IX, pictured on the obverse of the coin, was known as the 'father-in-law' of Europe because two of his daughters and one son married into the royal lines of England, Russia and Greece respectively, and his grandson became the King of Norway. This coin is exceedingly popular with the people of Denmark in that the "Mermaid" is the national symbol of the country. These beautiful gold pieces were minted between the years of 1873 and 1900, have a Fineness of 0.900, and Actual Gold Content of 0.2592 troy ounce. This prize coin was minted in the first year of production, 1873 !

There will be also be two runners-up prizes for the next closest prognostications --- each winning an one ounce pure Silver U.S. Eagle.


1) The Winner is the poster with the Price Guess closest to the Settlement price of the COMEX (most active) April 2007 Gold Contract (GCJ07) on the date of Wednesday, February 28, 2007.

2) Price "Guesses" shall be stated in Dollars and tenths !
(Such as $666.6)

3) "Guesses" shall be SHOWN in the SUBJECT BOX location AND enclosed in markers of "Dollar Signs" so as to be OFFICIAL !
(Such as $$$$$ $666.6 $$$$$$$ )

4) ONLY one "Guess" per Knight or Lady is allowed, and once that "Guess" has been "taken" -- no one can duplicate it !! FIRST COME has rights to that "Guess".

5) HOWEVER, All "Guesses" MUST be posted before the clock in Denver strikes MIDNIGHT (24:00) on Saturday, February 24, 2007.

6) AND MOST IMPORTANTLY (as this part MUST accompany the Price prognostication)
--- In order for your entry to be valid, entries will need to have a full answer to the QUESTION, in 30 words, OR MORE. <===== NOTE !!!
LET the CONTEST conclude at MIDNIGHT !

Gandalf the WhiteLAST CALL (for sssistance) <;-)#1525532/24/07; 02:07:27

IF I have missed your POG Contest entry ---
PLEASE YELL at me !!

Topazfurther @smiles 45.#1525542/24/07; 03:58:30

Just had a violent thunderstorm go through.
It may have been only 4 or 5 Yr's ago come to think of it. At the time the world became quite focused on the "plight" of Africa generally (for approx 6 mth's).
I recall a Presidential press conference announcement and, as Iraq was the subject du jour, the World press held it's breath. however, at the PC, GWB flanked by Sec'y Powell spoke inanely for 30secs about the Africa ...and that was it ...most peculiar.
Shortly thereafter T'Sec'y O'Neill went with U2's Bono to Africa ...and promptly resigned on his return. (remember the silly hat photo?)
The conclusion I drew at the time was that Sth Africa had nationalised their "resorces" (as opposed to Mining Co reserves, proven and unp) and had swapped them for T's (paperised)

So, I don't think your Shareholders are under the pump just yet as the said paper would be similar to a 30 Yr Long Bond ...only Gold backed.

Shanti$$$$$ 696,90 $$$$$#1525552/24/07; 07:59:24

Since the "push the button" has been discovered to print "a la volonté" by (almost) all CB's, we see the reality happening before our eyes. The plot written in the Gold trail archives here at USAGOLD is coming closer & closer every day, there seems no way back anymore.

The accelerating overhang of huge liquidity of the above together with the liquidity created by fractional banking + the use of multi leveraged derivatives is snapping around the world for ROI. With just 1 mouse click away today it is astonishing that bazillions of currency can be transferred in nanoseconds........ Just imagine if only a small part is looking for GOLD what you think POG will do.......?

Long term trend is crystal clear what trend we are heading for, although short term is guessing, so for this year high my guess is $$$ 999.99 $$$

Still we have to reconsider what we wish for, if POG heads for extraordinary highs the other side of the medal would may be not so nice. To be prepared i would recommend to follow the slogan of Black Blade.


slingshotDeep Storage Gold#1525562/24/07; 08:21:45

Hope the link works

Camel$$$$$ 694.5 $$$$#1525572/24/07; 08:36:33

Gold this year will briefly revisit its former all time high of around $850 and the reason may be expressed in one word ..... China .

China has allocated about 200 billion of its one trillion reserves to be shifted from US Treasuries to other types of investments which will be negative for the US dollar . The dollar spent many months in a highly choreographed equilibrium around 90, then fell to the 85 level where it has found another equilibrium. As China reallocates its reserves the dollar will drop to around 80 where it will again find an equilibrium awaiting further developments in the coming years which will lift it to even greater heights..

GoldiloxMore trouble on the "home front"#1525582/24/07; 09:50:59,0,3998543.story?coll=chi-business-hed


Lowe's Cos. on Friday reported an 11.5 percent drop in fourth-quarter profit, but the results still beat estimates and the company said sales will start to pick up in the second half of the year.

The Mooresville, N.C.-based company said net income fell to $613 million, or 40 cents a share, from $693 million, or 43 cents a share, a year earlier. The latest result surpassed estimates by 3 cents a share.

Sales slipped 3.7 percent, to $10.4 billion, the first decline in at least a decade. The fourth quarter had one fewer week than the year-ago period. Adjusted for that, sales rose 5 percent. Same-store sales, a key measure of industry performance that is based on sales in stores open at least one year, fell 5.3 percent.


Not as bleak as Home Depot, but certainly feeling the effects of a slumping home sales market.

GoldiloxPoG review#1525602/24/07; 10:10:47

Click to the "8 hour" view to hone in on the last four months - a 105 point, 18% rise. Not without some "back and fill", but pretty steady, none the less.

Many are predicting another "breather" soon, but from what level?

$688 (yesterday's high), $700, $720, $730 (old high), $730+ (new high)????

Get your guess posted today for Wednesday's April contract close to help lighten CPM's load by one fabulous coin.

Be sure to follow the Wizard's simple rules, as the Hobbits can get cranky!


GoldSilverRatio$$$$$$$$$$$$$$ 684.6 $$$$$$$$$$$$ #1525612/24/07; 11:04:16

$$$$$$$$$$$$$$ $684.6 $$$$$$$$$$$$
The "price" of Gold will remain One (1) piece of Twenty US Dollar Genuine Constitutional Gold Coin, of course. The reason being, there is insufficient time, let alone inclination for Congress and the States to amend the Constitution this year. Even if the Honorable Ron Paul was not the only one in Congress thinking honest thoughts on money.
The exchange rate of Gold in terms of Silver: I expect Gold to continue dropping against Silver. Not just this year, but until the present ratio of about 48 drops to around 20 or lower, perhaps in a few or several years. Then it would be very profitable to trade in bags of 90% Silver Coins for Gold Coins, getting more than twice as many Gold Coins as I could afford today.
In terms of Genuine Copper Pennies or Genuine Nickel Nickels, Gold price has already reached a plateau and their commodity values should trade pretty much in tandem. In theory, you could simply buy rolls of Pennies or Nickels. But practically speaking, non-precious metals take too much space. Besides, realizing their inherent melt value is illegal for now, until and if they are demonetized allowed trading freely. Long wait, meanwhile getting only their pitiful one cent and five cent face values. So, the only game is in precious metals.
We may possibly be better off with silver coins in stable times until the ratio finds sort of equilibrium.
We are definitely best off with gold coins in turbulent times of wars, rumors of wars, reckless printing of money and derivatives.
The degree of stability is a subjective guess and requires vigilant monitoring and teamwork. Therefore, I don't disagree with holding gold and silver in any particular ratio.
In any event, I expect to be worst off and feeling rather foolish holding Federal Reserve Notes and related promises in the longer term, meaning months, any time hereafter. It is bad enough that "in-service" choices in my 401k Fidelity holdings are being held hostage in FRNs. I am frustrated about the future of Social Security, having involuntarily contributed the maximum all these years. 56, victimized, all the way, all the time.
Therefore, regardless of the gold "price", this year, and thereafter, all discretionary funds simply must go to purchasing precious metals for delivery. Still, it is not nearly enough to compensate for the risks.

Best Case Scenario: Should peace and prosperity break out unexpectedly, the price of Federal Reserve Notes should be dropping only at the moderate rate of synthetic M3 inflation or 11%. This implies Gold trading at only FRN760 this year. Luckily, there is more time to accumulate more gold at these attractive exchange rates.
Worst Case Scenario: Should the Decider decide to attack Iran, or should the foreign holders of FRNs decide to cash in their chips, or should the luck of High Roller hedge funds run out, or should there be a run on the casino, the fiat FRNs could likely experience the familiar Sudden Death Syndrome, following hundreds of similar paper currencies of similarly deceptive, greedy, reckless and arrogant regimes. Once confidence begins melting down at accelerating rates, first suspicion, then alarm sets in, quickly followed by desperation, panic, then finally collapse with its horrors. Rational expectations would lead to FRNs continuing their inexorable collapse at rates of thousand fold ahead of the rate of money supply increase. Milton Friedman was dead wrong, since the final stages of inflation, like a drug overdose, are hyperbolic and out of control. Nothing like the easy-to-manipulate early stages where most can be fooled most of the time. Recall the hurricane of Perfect Storm or look down on the vortex next time you flush the toilet. The underlying math of the logarithmic spiral is analogous. In this worst-case scenario, neither very likely nor entirely impossible this year, only a fool would exchange Gold for collapsing paper at any rate. Well, except perhaps a few ounces to pay off a mortgage and another to pay the annual real estate tax - if you are a really brave optimist or lack alternatives. Else, use small gold coins to get tickets on the last train out, fill up the SUV one more time, or bribe the guards. At that point it would make absolutely zero difference how many zeros are printed on FRNs: FRN10,000/oz, or FRN1,000,000,000 or FRN1,000,000,000,000,000 since the fraud perpetrated on unsuspecting paper-promise holders would be fully exposed. The groups three zeros did not matter on French Assignats, Weimar Republic Reichsmarks, Hungarian Pengos or Yugoslav Dinars. Tragically and unnecessarily, most people not having the foresight and discipline to accumulate all the gold affordable NOW will likely be ruined, like holders of Continental Dollars or Confederate Dollars. Holders of paper promises of all kinds, life insurance policies, especially retirees on fixed FRN-designated incomes like Social Security or mutual funds or ETFs, yes, ETFs, will be destitute and many suicidal. Ancient, recent and current history is full of hundreds of precedents.
Most Likely Scenario: Somewhere between the above extremes, with accelerating fiat depreciation, increasingly violent volatility in the make-believe paper markets to pry gold from weak hands. Highs FRN1,000/oz this year, FRN2,500/oz within three years, FRN50,000/oz in five to seven years.
However, the price of gold will remain Twenty US Dollars in Genuine Constitutional Gold Coin with the same purchasing power it had in Constitutional Times.
I suggest the next guessing game, if any, to go something like this: How many counterfeit, aka paper FRNs, will be exchangeable for a Constitutional pre-1933 $20 Gold Coin? How many ounces of silver will be exchangeable for one ounce of gold? Or to make it easier: How many barrels of oil will trade for one ounce of Gold? Where are we on the Golden Trail?

Gandalf the WhiteTAA TAA TAAAAAAAAAAAAA ----