USAGOLD Gold Discussion Forum Archive

Electronic reproduction sourced from
TownCrierGold Rises in Asia as Possible Iran Sanctions Spur Haven Buying#1528253/1/07; 02:18:10

March 1 (Bloomberg) -- Gold rose in Asia for the fourth day in five as the prospect of United Nations sanctions against Iran spurred demand from investors buying bullion as a haven.

Tensions surrounding Iran's nuclear program have heightened this week with the U.S., the U.K., Russia, China, France and Germany set to discuss by telephone later today elements of a new UN resolution against Iran...

"Fundamentally, nothing much has changed for gold, the geopolitical tensions remain, if anything it is a safe haven," said Darren Heathcote, head of trading at Investec Bank (Australia) Ltd. "I think the expectations are it will head towards the highs of yesterday, around the $679 level again."

Gold for immediate delivery rose as much as $8.20, or 1.2 percent, to $677.55 an ounce and traded at 676.96 at 12:11 p.m. Sydney time, extending the metal's 0.9 percent gain late yesterday in New York.

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It's almost comical -- that the very same 24-hr gold market can look so completely positive when viewed from the Oriental timeframe as compared to the gloomier paintjob in the Occident.


TownCrierBecause Inflation is 'Forever'#1528263/1/07; 02:48:19

(Mar 1st, 2007) Tim Iacono submits: The title of this post is not something you're likely to hear from the U.S. Postal Regulatory Commission as their rationale ... but that's the reality.

A new "forever" stamp -- good for mailing a letter no matter how much rates rise -- was recommended Monday by the independent Postal Regulatory Commission. The panel also called for a 2-cent increase in first-class rates to 41 cents...

"Adoption of this proposal is good for the Postal Service, postal customers and our postal system," commission chairman Dan G. Blair said at a briefing.
A forever stamp would not carry a denomination, but would sell for whatever the first-class rate was at the time.

For example, if the 41-cent rate takes effect, forever stamps would sell for 41 cents. If rates later climbed to 45 cents or more, the price of the forever stamp would also go up at the counter or machine, but those purchased before the change would still be valid to mail a letter.

If the forever stamp ever sees the light of day, get ready for a real, unambiguous indicator of "inflation expectations" from the American public.

The various data collectors who calculate inflation expectations may be able to stop asking people whether they think consumer prices will rise 3.2 percent or 4.1 percent or 2.6 percent in the year ahead and just watch the Postal Service printing presses as they struggle to keep up with demand for the new stamp where mailers can lock in current postal rates -- forever.

It seems that postal rates are rising much more rapidly than the government's Consumer Price Index.

Just like the U.S. Mint, offering $700 gold coins with a face value of $50, the postal service appears to be undoing the hard work of the Federal Reserve in establishing "inflation expectations" far different than those that exist in the real world.

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When this idea was first floated (a year or so ago) a few of our forum's very astute posters were clearly way ahead of the learning curve -- having fully discussed this and arrived at the same assessment that has been so eloquently presented in this current piece by Tim Iacono.

Keep up the good work, Forumers!


Lackluster"forever stamps"#1528273/1/07; 05:27:15

Some time ago here in Massachusetts, the Registry of Motor Vehicles implemented a new registration scheme, where one could, for a higher fee, register ones car for as long as you owned it. Normally one has to re-register every two years. It seemed like a good deal, I remember my Father registering his car that way.

Well, guess how long that new scheme lasted? Three or four years, then the Commonwealth needed money, so it went out the window. Even if one had signed up for it, one was forced to start registering the old way. I don't think the Registry reimbursed any of the people for their higher registration fee they had paid for the "forever registration."

TucoContest#1528283/1/07; 05:59:02

Thank you Sir MK and Sir Gandolf for sponsoring the price of gold guessing contest. I am a faithful lurker. Without going into long-winded detail, I can say that this site has had a great, positive impact on me. Again, thank you for the contest and the wonderful site.

Oh, my secret for winning--Just as Tuco would do in "The Good, The Bad, and The Ugly", I just spotted my target and fired from the hip.


mikalHeadline rundown#1528293/1/07; 06:36:50

Gold Rises in Asia as Possible Iran Sanctions Spur Haven Buying - Bloomberg
Yen Rises as Foreign Investors Boost Purchases of Japan's Debt - Bloomberg
Chicago manufacturing losing momentum - Chi. Trib
Fed Doesn't See Subprime Mortgages as Threat - Bloomberg Greenspan Says U.S. Recession Possible, Not Probable - Bloomberg
Commerce Department Says U.S. Economy Is Weaker Than Expected - NY Times
Mortgage Defaults Start to Spread - WSJ
Waning Appetite for Risk Poses Challenges - WSJ
Agencies issue subprime guidance: sources - Reuters
Is the S.E.C. Changing Course? - NY Times
Freddie Mac Tightens Standards - NY Times
Asian stocks wobble as aftershocks continue - AFP
Foreigners in for steep tax rises as China's parliament meets - AFP

mikalMore gov't 'figures' and 'guages'#1528303/1/07; 07:09:58 U.S. January Personal Spending Rises 0.5%, Core Prices Up 0.3% - - March 1, 2007 -- Excerpt:
"Personal spending in the U.S. increased more than forecast
in January and the Federal Reserve's preferred price guage accelerated, suggesting inflation wil remain the central bank's biggest concern."
The "CB's biggest concern" may be that we'll find out what their biggest concern really is.
The article goes on to admit that consumer spending is needed to fill the gap left by slowing manufacturing and housing, but does not question the methodology of sampling and measurement in the spending 'guage'.
Though this gap is addressed indirectly with the inclusion of anecdotes of disappointing results at some large retailers.

slingshotContest#1528313/1/07; 07:10:24

Congrats to the Winners. Thanks again to USAGOLD and Sir M.K. for hosting it. To all the participants, thanks for all the great posts. To Gandalf the White, for his time and patience a special thanks. Rules! We must have Rules! :0) I do not know for sure but I'm beginning to suspect this may have been the last contest. Too many warning signs and the majority of the expectations are positive for gold to rise. We all have thrown a piece of the puzzle into a blender and for some people that mixture will be a deadly drink who stay in the FIAT REALM.
This contest was at a turning point.Things are not as good in the market as it seems. Greed and Fear have raised their ugly heads. We are far ahead on the learning curve. Enough along that we all can weather the coming storm.


mikal(No Subject)#1528323/1/07; 07:32:05

Maybe Russell is Right - Peter Brimelow and Edwin S. Rubenstein - MarketWatch
Maybe P.E.'s and stock prices are too high

Clink!Contest#1528333/1/07; 07:34:51

Congratulations to the winners and a BIG Thank You to our gracious sponsor and his wizardly umpire. After a hesitant start because it was a pretty thought-provoking question, I was favorably impressed by some of the responses.

@ Goldi, I think you underestimate MK's knowledge of the market. He always chooses a moment when things look about ready to go crazy with volatility. After all, why have they always been called price-GUESSING contests, not price-ESTIMATING ones !!

@ Placer Gold - that was an interesting find you made in the bottle.


Silver Foxslingshot #: 152831#1528343/1/07; 07:36:19


Although the world's economy is indeed on the "edge", I wouldn't be surprised to see "them" pull the rabbit out of the hat again. It seems that all of the major players are working at keeping the "house of cards" standing. Mean while, each player maneuvers their position on the board; i.e. China & Russia chumming up with Iran, Europe entering into long term contracts for oil with "exporters". Given Rice's recent surprise announcement of the invitation of Iran and Syria to Iraq for negotiating, it may well be another dangerous "turn" has been averted.

One thing for sure, when the baby boomers begin to retire in earnest, the subsequent impact of reducing Federal tax receipts and while expenses explode will not be able to be avoided. Therefore, even if we avoid the immediate problems, derivatives, baby boomers and other issues WILL certainly collapse the dollar in the NEAR future.


GoldiloxDOW off 200 in early trading#1528353/1/07; 07:52:23

"Second verse, same as the first!"
GoldiloxBoomer retirement#1528363/1/07; 07:57:00

@Silver Fox

"One thing for sure, when the baby boomers begin to retire in earnest, the subsequent impact of reducing Federal tax receipts and while expenses explode will not be able to be avoided."

There has ALWAYS been a surplus in SSI, that the lawmakers have eagerly absconded with for wars and other pork-laden activities. Why do you think that those who work for the government are NOT dependent on SSI for their retirement? They KNOW they are stealing it, that's why!

Blaming the Baby boomers for "draining the swamp" is just what the media wants us to believe.

Silver FoxGoldilox #: 152836#1528373/1/07; 08:07:25

Boomer retirement

Worse, I believe it was on Goldseek Radio were I heard that ½ of all US baby boomers have no savings and will be 100% dependent on SS. If the politicians, (what am I saying, they don't control the government), if our "masters" try to significantly reduce the SS payments, I would bet on seriously angry boomer protests in the streets. That might be why the "masters" are debasing our currency so quickly.


GoldiloxSavings#1528383/1/07; 08:15:19

@ Silver Fox,

Worse yet, of the 50% who do have savings, if they aren't listening to the "paper will burn" warnings, they probably won't have any soon.

Got gold?

GoldiloxWake-up call#1528393/1/07; 08:19:00

My landlord called me at 6:32 and asked "What's happening to this market."

My reply? "The chickens are coming home to roost."

Don't know if he "gets it" yet, but he was mumbling something about buying some farmland near water.

I keep exhorting him to turn off CNBC and get on the Net, but he has a million excuses why he has no time.

Silver FoxGoldilox #: 152839#1528403/1/07; 08:41:20

TV: "Opiate of the Masses"

The six companies that control the media feed the masses a daily "dumbing down" of worthless, happyonomics: inflation is low, global warming isn't real, there is an unlimited amount of oil, the US economy is strong, the DOW is at a record high, bonds and treasuries are good investments, etc.

Karl Marx had it right last century, but anymore, it seems like the TV is replacing religion as the "opiate of the masses". Like your neighbor, when I try to talk "sense" to my friends, it is like I am speaking a foreign language that they just don't understand.

When the party is over, the Mogambo advises that "the collapse" will be over in a month. If at that time, you are not "holding" gold, it will then be too late. As such, I am afraid for my friends. Telling them "I told you so" will not bring me any joy.


YGMSilver Fox...try to talk "sense" to my friends#1528413/1/07; 09:13:25

I started on my friends about 1989, by 1999 I was hounding, being ridiculed etc. Sure buddy I'll buy physical Gold @ $265.00 or Glamis Gold @ $3.00...NOT! GATA? What would I want to join those goldnuts for? Well hey, I had the last laugh there also.
Well nowadays they're still working 9-5 for the bank loans on everything they "think" they own, and I owe not one red cent with all my assets paid for in cash. I seldom waste my time anymore, even tho there's still so much unseen upside to real hard in your hand 'Yellow' money!

MKIn a corner office facing the castle courtyard with a view of now winter garden: . .#1528423/1/07; 09:18:23

MK sits at his desk thinking simple contest thoughts. All is quiet for it is the beginning of the day and the castle mainframe (there is more to this castle than many think) boots up to the USAGOLD page. As he clicks to see the current gold price, the telephone rings with a lound trumpet like sound:

MK (loudly to the outer room, letting the phone ring): Marie, Marie. . . . .Can you please contact our great and wondrous wizard? He's programmed the phone ring on "trumpets" again. He must be having one of those infernal price guessing contests again at the forum. I was just thinking about that. . . .

Marie (picking up the phone): Good morning. This is the Castle. Yes, he's in. May I tell him who's calling. (Pause) The PPT? Can I ask the nature of the call?You can't say except that it is a matter of utmost importance to the nation? Very well, I'll put you through. (Puts the phone on hold.) It's the PPT, they would like to ask you a question.

MK: The PPT? What is that?

Marie: The Plunge Protection Team.

MK: The Plunge Protection Team? Who are they?

Marie: They are the organization that protects the kingdom against plunges.

MK: Plunges? What kind of plunges? OK. OK. I'll take the call. . . .(Picking up the phone) This is MK how can I help you?

PPT (Gruffly): MK, we understand that you are having one of your forum is having one of those famous gold price guessing contests.

MK: Well, yes. . .I believe so. . .at least Gandalf, our esteemed and noble wizard of at least 150 years, called the other day to see if the Castle Treasury still had. . . .

PPT (Interrupting): We don't need to hear all that. We know you are having a price guessing contest and we fear it is responsible for disrupting the markets!

MK: The markets? All of them??

PPT: Yes, all of them. And you probably know, if you read your own forum, that the PPT is charged with the possibility of keeping the markets stable, confidence up and liquidity flowing like the mighty Mississippi.

MK: The mighty Mississippi. Yes. I like that.

PPT: Occasionally we deem it necessary to take overt action when someone or something threatens market stability.

MK (with a chuckle): Have you talked to Alan Greenspan lately? No, No. . .just kidding of course. Now who did you say you represented again?

PPT: The PPT. The Plunge Protection Team. Let me get to the purpose of my call. These contests of yours cause volatility in the gold market which spills over to the stock market, then to the bond market, the housing market and finally the economy as a whole. We call it the USAGOLD Price Guessing Contest Falling Dominoe Effect and Syndrome, or USAGOLDPGCFDEAS for short. In short these contests endanger the public well-being, and we've come to the conclusion that something needs to be done.

MK (Excitedly): Aha! I knew it! And what about those trumpets. Those loud, blaring, mind-numbing trumpets. I've talked with Gandalf about that many times. . . . many times. The PPT needs to do something about that as well and let me say that I am 100% behind it.

PPT (Impatiently): We didn't call to discuss trumpets and wizards we called to discuss volatility and why there is market volatility across the boards every time you call the USAGOLD forum to contest.

MK: Well, I guess we all have our priorities.

PPT: We, the Plunge Protection Team, would like to know if you would mind if we manipulated your contests. You see, this is what we do. We manipulate things. Let me rephrase that -- we "manage" things. And this contest of yours keeps upsetting the apple cart. We are talking simple cause and effect here. The Team came to the conclusion that it would be the simplest, straight-line solution to simply manage your contests and then the gold market, stock market, bond market, the economy and the inflation rate will all fall into line. We won't need Bernanke anymore and Paulson can spend as much time in China as he wants. . . .and. . .well. . . . you get the picture.

MK: Incredible. All because of our contests? Oh my. . .So how do you propose to accomplish this?

PPT: You will make a new rule that everyone has to make the same price guess. That would eliminate the volatility.

MK: The same price guess? But, you see, the purpose of the contest is to. . .

PPT (Interrupting again): How can you care about contests when we are talking the whole world economy. What say you?

MK (thinking quickly): I'm not sure. Let me put you on hold.

MK: Marie. . .Marrrrrrrrrie. . . Please bring the portable extension, we must go to the vault and find that last Mermaid coin I've specially hidden for Tuco. You won't believe who I'm talking to on the phone. . . .Oh you say you know, who it is. You were the one who put them through to me. Yes. Odd isn't it. They are asking if they can manipulate the contests. . . .Did you bring the keys?

(Voices fade)

To be continued. . . .

Thanks everyone. Enjoyed the discussion in and around contest time.

GoldiloxPPT call#1528433/1/07; 09:23:00

@ MK,

Next time they call, have Marie ask for the caller's home phone number, and tell them you'll get back to them at dinner time!


YGMBank Failure in USA#1528443/1/07; 09:29:16

First bank failure in years happens in Pittsburgh

The streak is over.

After nearly 21/2 years without a bank failure, a small Pennsylvania bank collapsed this month.

Metropolitan Savings Bank of Pittsburgh was closed by its state banking department. About $12 million in deposits were assumed by Allegheny Valley Bank of Pittsburgh.

The Federal Deposit Insurance Corp. said Metropolitan had about $1.2 million in deposits in 70 accounts that could exceed the federal insurance limit.

The last bank failure occurred in June 2004, the longest period without a failure since the FDIC was formed in 1934.

GoldiloxComix Roller coaster#1528453/1/07; 09:45:30

Quite the battle raging on the trading floor around $670.

The chart resembles a condition that inspired new shocks on my motorcycle.

Gandalf the WhiteSIR MK !!! Now the PPT is calling me ! ON MY CELLPHONE !!#1528463/1/07; 10:13:07

AND see what they have done now after you spoke to them at 0930 East Coast Time ! (CLICK on the chart LINK !)
To get even, maybe USAGOLD should have MORE POG CONTESTS !!!

The HoopleGoldilox#1528473/1/07; 10:41:41

Maybe you've coined a new term for PPT operations at the Comex- "the shock absorber shorts".

Watching today's 200 point Dow drop, followed by recovery into a comatose state reminds me of someone facing an armed intruder wanting to terrorize them. The solution obviously is to take a tranquilizer and pretend he isn't there. After all if you can't remember him being there, he isn't, right?

SmeagolContesst Collusion Coalition#1528483/1/07; 10:44:51

Humor comes not oft from Ssir MK's pen! BWAHAHAHAAA! Sss! That one should be saved!

"MK: Incredible. All because of our contests? Oh my. . .So how do you propose to accomplish this?

PPT: You will make a new rule that everyone has to make the same price guess. That would eliminate the volatility."

we likes thiss... O yess we does... next Contesst, we'll all jusst guess... ssay, FRN30,000 per ounce of IT! That ought to "fix" things!

Trebuchets indeed! (cackle!) >8-)

By the way, Congratulations to the Contesst winners! ~8-)

Goldilox"Shock Absorber Shorts"#1528493/1/07; 10:55:12

@ the Hoople,

That would never do. In the world of gubmint/military acronyms, SAS is already spoken for, at least in hush circles, not to mention Scandinavian Airlines, and Serial Atached SCSI.

I still prefer "Paulson's Pirate Team", or SGIF (Spank Gold it's Friday).


From Wikipedia, the free encyclopedia

Special Air Service

The Special Air Service Regiment (SAS) is the principal special forces unit of the British Army. A small and secretive institution, it sometimes attracts a disproportionate amount of media coverage. The SAS was formed in 1941 with British volunteers to conduct raids behind enemy lines in North Africa, and today serves as a model for similar units fielded by other countries.

The SAS forms part of the United Kingdom Special Forces, alongside the Special Boat Service (SBS), Special Reconnaissance Regiment (SRR), and Special Forces Support Group (SFSG). The SAS is the oldest special forces unit in the world, tracing its existence back to 1941 and the North African Campaign of the Second World War. It is renowned for its elitism and is widely viewed as the best trained special forces unit in the world. It has been and is currently employed to train other elite units such as Mossad.

GoldiloxNow we've ticked them off !#1528503/1/07; 11:03:32

The after lunch crowd is dumping gold paper just to tick us off, I'm sure.

They're using the last trading hour to dump-and-run, like the cowards they are.

Spot and Spike, sic 'em!

WaveriderThe Golden Archives are calling......#1528513/1/07; 11:29:01

Yes Sir Smeagol - I would like to second your vote that Sir MK's PPT pose be entred into The Hall of Fame! Precious pieces MUST be kept in the Golden Archives!

Congratulations to all contest winners and another big thank you to Sir MK and Sir Gandalf for running the contest. Cheers,


donnemuirMK @ 152842 152848 152851#1528523/1/07; 12:28:44

Call for the question.....All in favor aye!
Caradocmy vote...#1528533/1/07; 12:46:27

Aye! MK's post of that phone call is a keeper.


TopazDelivery Ag.#1528543/1/07; 13:28:18

This is becoming the norm now, they neglect to post the Delivery Notice on the first day ...soften the blow I 'spose.
With 3100odd yesterday plus 800 today Ag might have nothing left (we'll get a better idea when they update the vol/OI) to give, inspiring this current drop-off.
Ag is normally a lot more honest than this ...particularly during delivery mth and I'd reckon this action is more a desperation measure than any wholesale loss of faith in Aggie ...we'll see!

Henricirca 2010 overheard near the tent camp of Sir Henri#1528553/1/07; 13:29:07

SH: what's that? Who goes there?

PTB: it's me, Henri...the sheriff.

SH: What you again? what do you want now?

PTB: Well sir its about your chip. It seems to have gone missing again.

SH: What my chip? umm, I had it yeshterday...yesheree ahm sureofit. where did that leedle rashcal go anyway...I don know why itsho impotent anyhow ...wayt da minute...howd you know my chip is gone anyhow?

PTB: Well our TV camera had you walking by with a bag of tagged groceries and we got no blip of who was carrying them so it recorded you and sent it in to central and they sent it to me nad well you know how the drill goes. Say how did you get those groceries anyway???

SH: Dang it you guys have gone too far now...I spect you have finally infiltrated the Amish now too. Did someone plant a tag in my groceries?! They were shposed ta be clean...I don't know where that chip is...ahhh hey wait a minute...those guys who beat me up last night mustve taken it...ya know thats the fourth one they got this winter... they trade.em ya know their good for so many of dem Imperial credits a month ya know...I wouldn't be sprised if they were sellin 'em.

PTB: Yeah, Yeah Henri, I've heard it all before...come to think of it your credits were being used in more than one spot at a time and and we wondered how you could be in three places at once when you're not anywhere at all out here in the camp. Say you wouldn't have sold yer chip ya know thats agin the law...

SH: An just exactly what would somebody have that I would want to sell my chip fer anyway??? I walk 20 miles to the farm in the mornin cause you took my license the first time they stole my chip...i work all day to get a meesly bag of veggies fer me stew pot and some rabbit meat that I got wi me snare...I spose thats agin the law too...hows a feller sposed ta survive anyway with all this chipotle merrygoroun'fest...I don..need no stinkin' chip anyway!

PTB: Alright Henri, you know the drill (He pulls the implanter from his holster)...

SH: Dang it sheriff you poke so many holes in me with that thing they think I'm a drug addict down at the railroad stop. Git that thing away from me... git back ye ahhhhhhRGH crap...that better not git infected again...

Liberty HeadOh That Volatility!#1528563/1/07; 13:35:21

A big big thanks to USA GOLD for allowing me to win a Silver Eagle.
I enjoyed this contest all the more for the volatility and the commentary.

Best Wishes

Henri@Topaz#1528573/1/07; 13:36:33

Are you saying that people are finally recognizing that the paper is no good without metal to back it? That the paper price is separating from the physical pricing???
SurvivorJust Another Example of Not Believing Everything You Hear. . . #1528583/1/07; 13:36:42

Time Magazine has released their top 25 of Crimes Of The [20th] Century.

I looked through the list, but did not find the 1913 act creating the Federal Reserve. Hmmm.

- Survivor (with tongue firmly planted in cheek)

TopazHenri#1528593/1/07; 14:11:01

Thats my greatest concern Henri, that as this evolves (devolves), a lot of good honest types will be caught divesting themselves of metal thinking the "price" is dropping. In reality, given the current price discovery mechanism, that couldn't be further from the truth, as what is being (or will be) discounted will be the ability of the paper receipt to "eventually" represent metal-in-hand.

Paper-Metal separation? These recent stealth actions on Comex (PoG/PoS) will give rise to more and more metal simply being witheld from market as metal-holders see through the P-D ruse imo.

Topazwhatsmore...#1528603/1/07; 14:32:21 not posting Wednesdays delivery notice the world was deprived of seeing what in fact caused the PoG price to hold up right into the close (last delivery for Feb) only to plummet in access trade shortly thereafter.

Answer: a handful of Au deliveries imo.

Hold your Metal close ...and TRY not to be influenced by these S/T price jolts.

flow5The Fed Funds "Bracket Racket"#1528613/1/07; 15:19:44

The buying and selling of Treasury bills, etc., under the auspices of the Manager of the Open Market Account through the New York Federal Reserve Bank for the accounts of all Federal Reserve Banks are tied to federal funds rates. As a guide to open market operations the rates are used as follows: a rise in the federal funds rate above the rate triggers open market selling operations. ; A fall below the rate, open market purchases. Open market operations of the buying type add (free gratis) legal reserves to the banking system; selling operations reduce reserves.
The technicians in charge of the hour-to-hour administration of open market operations apparently believe that there is, at any given time, a federal funds rate that is consonant with a proper rate of change in the money supply. They have in fact plugged this concept into a computer model. (e.g., the Taylor rule). What they have actually "plugged in" is an open ended device through which the commercial banks can decide whether or not there should be an expansion in the legal lending capacity of the banking system – the capacity to create credit (money) and to acquire additional earning assets. That this expansion in money and credit will always take place is attested to by the insignificant amount of excess reserves held at all times by the member banks.
A clear distinction should be made between the temporary and the longer term effects of open market operations on the level of interest rates. To hold down the Fed Funds rate (and other rates through this key rate), the Manager of the Open Market Account puts through buy orders for T-Bills or other eligible securities sufficient to yield a net increase in free, member bank reserves and free excess reserves. The Fed acquires these earning assets by creating free, new interbank demand deposits in the Federal Reserve Banks—that is by creating free, new legal reserves at the disposal of the member banks (IBDDs).
Assume the buy order is for T-Bills. The effect is to bid up their prices, reduce their discounts (interest rates) and add to free member bank legal and excess reserves. The expansion of free excess reserves increases the quantity of loan able "federal" funds thereby pegging or retarding the increase in the Fed Funds rate but the longer term effects of these operations are to fuel the fires of inflation.
An understanding of these temporary and longer term effects reveals why the tight money policy initiated in February 2006 brought about a continued upsurge in interest rates until 07/20/06.. But it had the longer term effect of bringing inflation and interest rates down, until the end of the FOMC's tight money policy in Dec..
Approximately 75 percent of the inflation between 1965 and the early 1980's was due to an irresponsible easy monetary policy. Since 1965, the operations of the trading desk has been dictated by the federal funds "bracket racket". This has assured the bankers that no matter what lines of credit they extend, they can always honor them since the Fed assures the banks access to free legal reserves whenever the banks need to cover their expanding loans – deposits.
Our monetary mismanagement has been the assumption that the money supply can be managed through interest rates. We should have learned the falsity of that assumption in the Dec. 1941-Mar. 1951 period. That was what the Treas. – Fed. Res. Accord of Mar. 1951 was all about The effect of tying open market policy to a fed Funds rate is to supply additional (and excessive free legal reserves) to the banking system when loan demand increases. Since the member banks have no excess reserves of significance the banks have to acquire additional, free, reserves to support the expansion of deposits resulting from their loan expansion. This has assured the bankers that no matter what lines of credit they extend, they can always honor them since the Fed assures the banks access to free legal reserves whenever the banks need to cover their expanding loans – deposits.
Apparently, the Fed's technical staff either never learned, or forgot, how Roosevelt got his "2 percent war". This was achieved by having the Fed stand ready to buy (or sell) all Treasury obligations at a price which would keep the interest rate on "T" bills below one percent, and long-term bonds around 2 -1/2 percent, and all other obligations in between. This was achieved through totalitarian means, involving the control of total bank credit and the specific rationing of that credit We had official price stability and "black market" inflation. This was reflected in the price indices as soon as price controls were removed.
The Fed cannot control interest rates, even in the short end of the market except temporarily. By attempting to slow the rise in the federal funds rate the Fed will pump an excessive volume of free legal reserves into the member banks.
The manager of the open market account uses a "creeping peg" inorder to add or drain bank reserves . The Manager of the Open Market Account should ignore the fed funds "bracket racket". A "Taylor like Rule" is responsible for our bubbles in stocks, oil, and residential and commercial real estate.

There is only one interest rate that the Fed can directly control: the discount rate charged to bank borrowers. The effect of Fed operations on all other interest rates is indirect, and varies widely over time, and in magnitude. In the last several months it's decoupled from legal reserves, inflation rates, and short term and long term interest rates.
As long as it is profitable for borrowers to borrow and commercial banks to lend, money creation is not self regulatory. This observation would be valid even though the Fed did not use the federal funds bracket device as a guide to open market operations. With the use of this device the Fed has actually pursued a policy of automatic accommodation. That is, additional free reserves and free excess reserves were made available to the banking system whenever the bankers and their customers saw an advantage in expanding loans. The member banks, lacking excess reserves, would bid up the federal funds rate to the top of the bracket thus triggering open market purchases, free bank reserves, more money creation, larger monetary flows (MVt), higher rates of inflation – and higher federal funds rates, more open market purchases, etc., etc.
Unfortunately, the effect of FOMC operations on the federal funds rate is unknown for an indefinite length of time. Using the fed funds rate, lags are variable. Likewise, the Fed cannot calculate the level of interest rates associated with the ROC in nominal gdp, as historically, they vary.
Monetarism involves controlling the volume of total reserves, not the volume of non-borrowed reserves as administered by Paul Volcker in Oct 1979 – 1982. Monetarism involves more than watching the aggregates, it also involves properly controlling them.. Monetarism has never been tried. If the money supply is controlled properly, the determination of interest rates can be left to market forces.
Because the Feds technical staff has based its policies on the incorrect assumption (that in their time deposits activities the commercial banks act as intermediaries in the savings-investment process), and the evidence is the elimination of all interest ceilings and reserve requirements on time deposits. Apparently, the Fed's technical staff believes commercial banks create new money, only in their transaction deposit operations, and not in their savings or time deposit operations. This must be their rationale behind discontinuing publishing M3. This will impact us in the long term, because it (the DIDMCA), will eventually cause our means-of-payment money to approximate M3
The "Taylor Rule"
R= P + .5Y + .5(P – 2) + 2
Where r = the fed funds rate
P is the rate of inflation over the previous four quarters
Y is the percentage deviation of real gdp from a target

flow5The Feb 28th Meltdown#1528623/1/07; 15:20:50

Guess what happened on bank squaring day, i.e., last day of the systems maintenance period? Banks postponed meeting a larger than normal part of their reserve requirements, until the last day of the reserve maintenance period, as the rate fluctuation data suggests.
So much for lagged reserve accounting. That happened to be one reason why contemporaneous reserve accounting, was favored over lagged reserve accounting. The volume of holiday transactions deposits was much higher 30 days ago, yet depository institutions had to meet their reserve requirements on those liabilities by Feb. 28, 2007. And because the volume of reserves supplied to the banking system by the FOMC was exceptionally low, the banks were unable to meet them.
As it happened, the funds "bracket racket" failed again. If the FOMC had been targeting the total member commercial bank adjusted legal reserve figure, there would not have been a panic in the financial markets. Consequently, to stabilize the financial markets, 17.25 bill of temporary repurchase agreements, consisting of treasury and agency securities, were issued on Feb. 28, 2007 (open market operations of the New York trading desk which added to the Federal Reserves portfolio -- SOMA). And because depository institutions total reserves had been drained beyond justification, I suspect that a significant number of depository institutions carried a 2% reserve shortage, into the next reserve maintenance period.
It has been repeatedly stated that the only tool at the disposal of the monetary authority in a free capitalistic system through which the volume of money can be controlled is legal reserves. If the FOMC ever came to grips with the historical experience, they would realize that the only type of bank asset that Fed can constantly monitored and absolutely control, are interbank demand deposits (IBDDs) held in the Reserve banks, owned by the commercial banks. This was the original definition of legal reserves in 1913, and it is the only viable definition.

A reserve maintenance period is a period over which the daily average reserves of a depository institution must equal or exceed its required reserves. Required reserves are based on daily average deposit liabilities in the reserve computation period

GoldiloxInflation causes?#1528633/1/07; 15:40:05

@ Flow5,

"Approximately 75 percent of the inflation between 1965 and the early 1980's was due to an irresponsible easy monetary policy."

My guess is you're only off by about 25%, or one third of the total.

Ain't statistics marvelous?

flow5The "Trigger"#1528643/1/07; 16:23:20

"The United States has the largest national economy in the world, with a GDP for 2006 of 12.98 trillion dollars" If we hiccup, it resonates around the world. In contradistinction, never, has it been any other way. So which do you think came first, the chicken or the egg?

fool me once, shame on you. fool me twice, shame on me.

Globalization isn't chic. There's no alternative. Imported oil, + U.S. foreign & domestic military policies will rapidly transform this country into one that has the highest poverty rate in the world. The exchange value of the dollar will perpetually, inexorably, relentlessly, depreciate, to where the U.S. will no longer have foreign policy choices.

TopazAggie update.#1528653/1/07; 16:48:48

Todays Vol/OI is posted and I'm encouraged by OI in the current month ...assuming it's not ALL market-maker churn we might get back on track.
In trading vernacular being seriously overweight might ultimately be injurous to your health's fun while it lasts tho!

TopazLand sakes!! You just don't know who to trust these days.#1528663/1/07; 17:03:18

Even the article downplays the fact that 24, not 13 charges were laid.
Love the part where the plot was uncovered and, rather than reporting it, they opted to blackmail the marks.
Can you say all-pervasive.

USAGOLD Daily Market ReportPage Update!#1528673/1/07; 17:40:37">
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.

THURSDAY Market Excerpts

March 1 (Reuters) -- COMEX gold futures dropped about 1 percent by late Thursday afternoon in New York as jitters set in after sellers returned to the stock markets. Even though gold is often seen as a safe haven in times of financial instability, analysts expected some investors to unload holdings and opt for liquidity as a wave of risk aversion swept through global markets for a second time this week.

Investors cashed in bullion holdings to pay for losses on equities.

The most-active April contract settled down $7.40 at $665.10, traded in a wide range of $664.40 to $680.20.

"It's just nervous, jittery type of trading right now. Gold is still pretty steady, although it's certainly run into some resistance between $675 to $680. So I still think you have that hangover from the Chinese news," said Bruce Dunn at Auramet Trading.

Dunn said gold would remain under pressure because of the volatile stock markets unless things turn around.

U.S. stocks tumbled early as a strengthening yen stirred concern that investors were being forced to unwind carry trades in a repeat of the risk aversion that sparked Tuesday's global market rout.

The Dow Jones industrial average and the benchmark Standard & Poor's 500 Index both sank nearly 2 percent in early morning trade. Both indexes finished just slightly down.

Gold hit a nine-month high of $689 on Monday as firm crude oil, tensions between Iran and the United States and a weaker dollar raised the metal's appeal as a haven and a hedge against inflation.

But it was hit, along with other financial markets, by heavy selling triggered by the biggest drop in China's main stock index in a decade.

Most analysts retain their friendly stance toward gold, with many looking for a move in coming weeks to $700 and above.

"Sentiment toward gold is still bullish, what happened this week is a blip, it coincided with a period when gold needed a consolidation period," said Stephen Briggs, analyst at SGCIB.

"The gold price is going to head toward $700, that's what people want it to do."

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

msiwantitallA disturbing presentation:#1528683/1/07; 18:24:28


I've enjoyed this site for the last few months, ever since a private wake-up call guided me into buy physical gold for the first time. And, although the inner voice that's always been pretty accurate in the past shouted at me to get my money out of the stock market and park it for spell, I didn't listen (again).

What is most frightening to me about all of the posts and articles I read about the reasons to get out of the stock market and buy gold is that they all basically confirm each other. The following 1-hour video/slide presentation, which was sent to me by a friend is a little different and worth a look. It presents insidiously cancerous fail-to-delivery shorting practices within the stock market that enables crooks to trade billions of dollars worth of stock without money. It also paints THE most unnerving picture of the SEC ever. The weirdest part is that, for all of the incredible information-packed content, the presenter is never identified. Here it is -- see what you make of it:

mikalOrbits, or bits.#1528693/1/07; 18:51:51;_ylt=AgTd5DdZrbafn0hZfYQLmXT2ULEF

Fears over launch of trading law By Anuj Gangahar in New York, Doug Cameron in Chicago and Jeremy Grant in Washington - 03/02/07
1 hour, 13 minutes ago -- Snippits:
"The US stock and options market will come under fresh pressure next week with the introduction of a controversial securities law that will push trading volumes to levels far higher than those that caused systems to crash during Tuesday's market sell-off.
The law, known as Regulation National Market System, or Reg NMS, is aimed at levelling the playing field in the US equity market, meaning trades must be routed to the exchange that offers the best price.
Reg NMS will shake up the trading environment and has forced exchanges to build new electronic trading systems or update existing ones to comply with the rule in time for next Monday's deadline.
It also means brokers must look for the fastest trades at the best price...

Some fear that the rapid development of electronic trading in the run-up toReg NMS means the systems might not have been sufficiently tested and that the spike in volumes that is widely predicted could ex-pose weak points. In Tuesday's sell-off some volume records were smashed, led by electronic trading, across almost all asset classes."

>> Daylight saving tech changeover coming later this month and now this all of a sudden. Good job probing some possible scenarios for the layman.
Tuesday was different and they're entitled to their opinion. What stands out is the original reporting AND the linkage to this week's event. This invites further exploration and speculation of all kinds. Bits and pieces.

GOLD FINGERAre the masses really that "stupid"?? (not meant to insult)#1528703/1/07; 18:54:17

It's amusing to me how the media will go to great lengths to tell others how it's "OK" to not really worry about the current market conditions.

If it was me I would be doing just the opposite. GET OUT AND STAY OUT!!

I hold NO paper investments other than fiat in stupid banks which I am converting ALL to hard assets by the end of this year.


This illusion is created by corporate staff writers to hold up the corporate torch! How sad that they can not get off the "feel good" bandwagon and report on the true state of economic affairs like greenspan has the balls to do. Maybe he wants to make a reversal and FINALLY stand up to the old school of doing business.

2007 will go down in history with some remarkable financial happenings!!

Here are some snippets from the good ole msn staff writers....guess they need to be concerned about MSN stocks too....

Americans hold on despite market

By Bradley Meacham
This week's global stock sell-off erased billions of dollars of market value.

But most Americans did exactly what investing experts advise in such a scenario: nothing.

According to a new MSN-Zogby poll, just 5% of Americans said they see a decline like this week's as an opportunity to buy, and only 1% said the slumping stock market causes them to sell.

Thirty-four percent said they either don't own stocks or are unsure how to react to a downturn.

Tuesday's around-the-world stock-market plunge trimmed more than $1 trillion from global equities. The Dow Jones Industrial Average ($INDU), which has recovered some of that day's 416-point fall, is still on pace for its biggest weekly drop since January 2003. The Standard & Poor's 500 Index ($INX) is on pace for the biggest weekly drop since September 2002.

Some sophisticated traders managed to profit handsomely from this week's chaos with complicated bets on bonds, foreign currencies and risky investments. Yet most investors who trade amid a market frenzy report losses, analysts said.

GF>>>>Again the only ones who really profit here are the investment bankers who win at others fall and the stock brokers. I read more and more how the little guy is being crushed and how the new babe boomers will retire to NOTHING!! This is not asset preservation!! What did they really expect?? To make a fortune? In today's political unrest? NOT!!

According to the poll, most Americans have heeded that lesson.

GF>>>>(SHAME)When a boat is sinking would you not want to get out or find something to float on? True you can't float on gold, but is a safety insurance for rotten times or ANYTIME!!

Among those (41%) who identify themselves as members of the investor class, 85% said they hold steady during market upheavals and don't make changes to their portfolios. But 8% of self-described investors say they buy, and 2% say they sell during a market downturn.

Men (61%) and women (59%) are about equally likely to hold onto their stocks during volatile shocks in the stock market.

The interactive survey was conducted Feb. 28 and March 1, and carries a margin of error of plus or minus 2.6 percentage points.

GF>>>>I WOULD HAVE JUMPED THE MOMENT I MADE THE "BIG GAINES " In this economy holding on would make no sence!! At least in some PAPER stocks.

PERHAPS HE REALLY IS help this time!

Much in demand
At the same time, Greenspan's outspokenness remains unusual for a former head of the world's top central bank. A year after erstwhile Fed chief Paul Volcker stepped down in 1987, he wasn't making similar market-moving statements. By contrast, Greenspan remains much in demand on the public speaking circuit and has seized the spotlight with other economic pronouncements since his retirement. The highly visible former chairman could prove a challenge for his successor even when their outlooks don't widely differ.

Get tuff!!
Get Smart!!
Get your gold!!



mikalCredit markets.... oh never mind#1528713/1/07; 19:03:18

Frenzied trading takes its toll on markets By Christopher Brown-Humes and Gillian Tett in London
1 hour, 16 minutes ago - 03/02/07 - - Snippits:
"Financial markets swung wildly on Thursday in volatile trading marked by further selling of equities and fears about an unravelling of the global carry trade...

At the same time, trading in US and European credit markets was exceptionally heavy for a third consecutive day. London trading was marked by particularly wild swings in the prices of credit derivatives, used to insure investors against corporate defaults...

Although the scale of market movements remain relatively small compared with historical crises, the spike in volatility now appears to be forcing investors to reassess their positions. Asset prices have been so stable that investors have adopted trading strategies based on the assumption that volatility will remain low - an assumption undermined this week.
Ronan Carr, European equity strategist at Morgan Stanley, said: "People initially thought we were only going to see a small pullback in equity markets, with no major correction. But it seems they are starting to doubt that."
Albert Edwards, at Dresdner Kleinwort, said: "We believe the long and widely awaited equity correction is upon us. We expect government bonds to be the safe haven."
The credit market moves suggest that the sentiment shift now under way in that sector could be more violent than anything occurring in the equity world."
Mikal-- I need to comment on this generous and motivated article due to Interantional Fair Use Copyright Laws. What you are seeing is little different than the scenario reprised over and over here. Lots of bluff, noise and "fury" as Jim Sinclair has stated. All in the name of stability, rolling seas notwithstanding. And if turbulence and volatility aren't
overused until we're all inured by them, we can enjoy the serenity afforded by a real safe haven...

mikalRe: Last post, 'turbulence' and 'volatility'- clarified#1528723/1/07; 19:14:46

If the words 'turbulence' and 'volatility' aren't
"reported" so often that they lose effectiveness as a warning, remaining objective on the markets and the often opposing news would come easier to some.
Thank you

GoldiloxTHE GOLDMAN FACTOR#1528733/1/07; 20:34:44


One can find a safe bet, that whenever gold flirts with the $700 mark, expect the unexpected. Silver was leading the way, moving into the mid-$14 level. Gold investors seem to require assurance to reinforce bravery. The events this week undercut that built bravery. As a result, gold and silver must climb a tougher wall of worry. My view regarding gold and monetary policy (central bank rate decisions) and stock/bond markets, against the backdrop of economic recession threats can be stated here simply. If over the next several months, gold fails to surpass $700, if silver fails to surpass $15, then we will be treated to a whopper recession. Why? Because the USEconomy has become driven by the financial sector in a truly bizarre display of a sick perversion. This is more than a tail wagging the dog. This is a Goldman tail wagging a dog sled team. In order to "control" gold, the powers must do irreparable harm to the entire economic system. They will therefore only permit little shocks. This accomplishes a concomitant fear factor to assist in the control of the gold price. My sure bet is that Goldman Sachs is behind the scenes working on the events this week. With Alan Greenspan gone from behind the curtain, Gentle Ben is not up to the task of pulling hidden levers. That job goes to the Team Goldman. The gold price was issuing loud shrill alarms. It will again, but fear must be quieted among the gold players. They must conclude once again, and they will, that gold will rise unless a painful recession is permitted from restricting the monetary spigot. The US cannot restrict that spigot, since its life blood is credit and not legitimate income from the manufacturing or other tangible sector. My gut tells me that the phrase "inflate or die" applies very aptly right now. The powers know it, so they shocked the system. Rates must rise in some global corners. Shocks might occur in other corners. But the flow of money which is constantly reflected in the gold price will remain brisk enough to lift that gold price. Is Goldman playing games, exploiting the cheaper gold price for large new long positions? Methinks probably yes


If all this gives you a headache, you are not alone. Rest assured that unless a global recession led by the crippled USEconomy is desired, gold will thrive in the months ahead. The gold price reflects the abuse of money, and in order to prevent a meltdown on the financial side and on the economic side and within the banking arena, money must flow briskly so as to conceal the damage and to fill the gaps, not to mention restore the losses by insiders on Wall Street. Gold will only falter persistently if the entire system crashes after permitting it to crash. As long as clownish desperate central banks are on the job, at the controls, you can count on monetary inflation. Printing money and perverting the statistics is what they do best. They live to inflate tomorrow's bubble in order to become heroes once again. They act as accident event underwriters of last resort in today's accident ridden world. Their jobs will not go away. Gold took a hit as it danced next to the $690 line, but it is stabilizing above the $660 line. That is not a bad place to rest and recover and regroup for the next skirmishes. Fires rage everywhere one turns. Gold rises from the heat.


JimWillie belives that nothing short of major recession will hold back PoG as things move forward.

Topaz@ms you want it all.#1528743/1/07; 20:50:30

Most deserving of a re-post in it's rightful spot in the link box ...scary huh?
Thank you.

CometoseWent awayfor two days and forgot to take my computer #1528753/1/07; 21:28:23

The dollar is approaching its new resistance at .8378

TO night 's THE NIGHT ........maybe ...............



Next stop for SILVER WILL BE


mikalMy apologies if a repost:#1528763/1/07; 22:52:10

Email from a stepbrother who is a senior:
"Maybe you've read this one....I know this feeling all too well...
Senior's Moment
A 98 year old woman wrote this to her bank. The bank manager thought it amusing enough to have it published in the New York Times:
Dear Sir:
I am writing to thank you for bouncing my check with which I endeavored to pay my plumber last month.
By my calculations, three 'nanoseconds' must have elapsed between his presenting the check and the arrival in my account of the funds needed to honor it. I refer, of course, to the automatic monthly deposit of my entire salary, an arrangement which, I admit, has been in place for only eight years.
You are to be commended for seizing that brief window of opportunity, and also for debiting my account $30 by way of penalty for the inconvenience caused to your bank.
My thankfulness springs from the manner in which this incident has caused me to rethink my errant financial ways.
I noticed that whereas I personally attend to your
telephone calls and letters, when I try to contact
you, I am confronted by the impersonal, overcharging,
pre-recorded, faceless entity which your bank has become.
From now on, I, like you, choose only to deal with a flesh-and-blood person. My mortgage and loan payments will therefore and hereafter no longer be automatic,
but will arrive at your bank by check, addressed
personally and confidentially to an employee at your
bank whom you must nominate.
Be aware that it is an offense under the Postal Act
for any other person to open such an envelope. Please find attached an Application Contact Status which I
require your chosen employee to complete.
I am sorry it runs to eight pages, but in order that I know as much about him or her as your bank knows about me, there is no alternative.
Please note that all copies of his or her medical
history must be countersigned by a Notary Public, and the mandatory details of his/her financial situation
(income, debts, assets and liabilities) must be
accompanied by documented proof.
In due course, I will issue your employee with a PIN
number which he/she must quote in dealings with me.
I regret that it cannot be shorter than 28 digits but, again, I have modeled it on the number of button
presses required of me to access my account balance on your phone bank service. As they say, imitation is
the sincerest form of flattery.
Let me level the playing field even further.
When you call me, press buttons as follows:
1. To make an appointment to see me.
2. To query a missing payment.
3. To transfer the call to my living room in case I
am there.
4. To transfer the call to my bedroom in case I am
5. To transfer the call to my toilet in case I am
attending to nature.
6. To transfer the call to my mobile phone if I am not at home.
7. To leave a message on my computer. (A password to access my computer is required. A password will be
communicated to you at a later date to the Authorized Contact.)
8. To return to the main menu and to listen to
options 1 through 7.
9. To make a general complaint or inquiry, the
contact will then be put on hold, pending the
attention of my automated answering service.
While this may, on occasion, involve a lengthy wait, uplifting music will play for the duration of the call. Regrettably, but again following your example, I must also levy an establishment fee to cover the setting up of this new arrangement.
May I wish you a happy, if ever so slightly less prosperous, New Year.
Your Humble Client (Remember: This was written by a 98 year old woman)

GOLD FINGERCrooks!...and I am sure there are MANY MORE!!#1528773/1/07; 23:53:27;_ylt=AgRK8Ao_kHxUc4pdHcPontIDW7oF

NEW YORK (Reuters) - Employees of some of Wall Street's top banks were among more than a dozen people charged on Thursday in what authorities called one of the most pervasive insider trading rings since the 1980s, accused of using leaked information and even blackmail to make millions of dollars.

Imagine how many more who have not and NEVER will be caught. Stealing the money of hard working American's~

Good time to buy Physical gold and keep it in YOUR hands.


melda laureFalling Knives, falling bricks, steel toed shoes.#1528783/2/07; 00:01:08

they say never to catch a falling knife.

This doesn't apply to gold, as it can never break- and even if it did, it would be unchanged.

Of course, the average investor is more likely to try to catch a falling index. Given the fundamentals, that may not be a good idea- besides, unless you are a Buffet, you could never take delivery.

TopazY-PoG#1528793/2/07; 03:37:13

After recently besting it's multi-year PoG high, Yen, following criticism from fellow G8 members at their recent knees-up in Essen, has reacted most out-of-character and plunged ...or better skyrocketed visavee everything!

BoJ are usually all over this sort of strength "managing" it back down. ...Hu knows why they're absent now?

Topaz$PoG.#1528803/2/07; 04:02:14

Odd little flurry in virtual SpotPoG just now. It popped up to accomodate the London "fix" @ $664 ...and now is settling back down.
I'd find the "fix" more credible if it popped $20 or $30 bucks and settled back down again to better reflect the Papermarket PoG.
It will one day ...count on it!

USAGOLD / Centennial Precious Metals, Inc.An inflation-adjusted hint at gold's price potential. PAST >>> PRESENT >>> FUTURE#1528823/2/07; 05:56:00">gold price potential
CometoseRED TAG SALE #1528833/2/07; 08:46:43

WHat a Party !!!

It looks like something's wrong with this picture .......

Someone paying homage to almighty dollar ..........

Funny that it is still bumping resistance this morning that was once support at .8380 and the silver and gold complex(s) are down 5.98% and 11% respectively....

since the drop began ....

WTIC .....not moved by all the monkey business ...maybe getting ready to roll over


How many billions were cashed out the other day at the fall of Mr Dow and SP and NASDAQ....

Good Cash to go on a buying spree at rock bottom prices after a precipitous and unlikely crash in metals.....

THE STENCH is going up my nose.....and smells of ROTTENNEESS.....

SPOILED RETARDS.......from IVY LEAGUE SCHOOLS that got in while the NETWORKING WAS GOOD ....NOW THEY DO ANYTHING THEY ARE TOLD for the security the FRN represents to them since they have NO OTHER KNOWHOW than to do what they are told be accepted by the crowd they married....and have given their souls to die for......

I am sure that everytime they do this ........
people who are a threat to national security and homeland security buy up the gold .......

PRESTO CHANGO .....and LOOK KIDS .......



DID any fundamental change happen in the last week to

WHAT you gonna do ......
Who you gonna call .....
What do people buy in times of global financial political instability ...
Do YOU think that the BIG BOYS are NOT POSITIONING THEMSELVES in allignment with this SEA CHANGE that relates to K WINTER ....inspite of having the neurotic bent to stay in control via unlimited PRINTING PRESS ABILITY...

When wars are waged, to the VICTOR go the SPOILS.....and I believe that the one trick pony show has arrived again ...
and we are on the verge of a STAND OFF or a WAR..
I believe banker's who finance war's require GOLD as COLLATERAL .....when these situations transpire.

Last night there was some IRREGULAR REPORTING OF PRICES at KITCO ......
THERE'S no limit to the mischief these people have to use at their disposal ......and it's a good CUT .....

REAL MONEY IS LIKE THE TRUTH , its the same yesterday today and forever....standing watch and serving its mission .....


The battle rages .........and skirmishes come and go and their casualties......but the longterm affects of inflation are embedded in the fundamental science of money and its distribution .....ever increasing supply of frns chasing limited supply increases of Natural resources required to sustain PEOPLES wants and needs causes PRICES of the RESOURCES to go up .

ONe has to decide if one wants to have GOLD OR SILVER IN ONES POSSESSION when the music stops and their are no more CHAIRS......just frns'''''' weimar germany style frns....

WHAT IS WRONG with the WEST ....the BANKER"S , POLITICIANS, and MEDIA , is that their time hozizon for doing things is not more than a few years ; it has to do with the next election or the year end botoom line ...
THEIR IS NO GUIDING LIGHT , vision , plan that THESE PEOPLE NAVIGATE BY,( excepting the social engineering programs that may or may not be leading to a NEW WORLD ORDER : a plan that is not in the interests of the people) . THE CHINESE are planning in 100 year increments . don't know what their plan is but long term given their population and buying power ....their plan is probably going to have more bearing on the future and global banking , politics .... than the activity taking place in the west.

I think , another cureency crisis their is not a destabilizing factor.......they will not be subjugated in this manner again .....Maybe the CIA will scare them into subjection by bringing more GERM WARFARE DIRTY TRICKS out of the closet .....again ...Maybe the ARABS and all of the far east and CHINA will get on board the NEW WORLD ORDER (BANKER CANCER) TRAIN ....and peace unity and harmony will grow out of a vacuum .........I DON'T THINK SO.....

as long as this is the state of affairs in the world ....
there will be no peace or trust ,,,,,,and GOLD WILL DO WHAT GOLD DOES ........acts as a WATCHMAN and it will be used as a tool from the EAST to KEEP WESTERN BANKERS and currency systems and governments HONEST.

mikalTime to lighten up says bank#1528843/2/07; 08:48:45 Dresdner recommends aggressive underweight in equities
Bloomberg | March 02, 2007

Druidflow5 (3/1/07; 15:20:50MT - msg#: 152862)#1528853/2/07; 09:07:18

"It has been repeatedly stated that the only tool at the disposal of the monetary authority in a free capitalistic system through which the volume of money can be controlled is legal reserves. If the FOMC ever came to grips with the historical experience, they would realize that the only type of bank asset that Fed can constantly monitored and absolutely control, are interbank demand deposits (IBDDs) held in the Reserve banks, owned by the commercial banks. This was the original definition of legal reserves in 1913, and it is the only viable definition.

A reserve maintenance period is a period over which the daily average reserves of a depository institution must equal or exceed its required reserves. Required reserves are based on daily average deposit liabilities in the reserve computation period."

Druid: Are some very large market participants beginning to realize this and adjusting their portfolios accordingly or, and probably a combination of both, is the CB banking cartel relationship(London, New York, Tokyo) beginnig to splinter which is feeding into this most recent volatility?
I would think, that through the interdependence that these CB's weaved together, someone would step up and cover any shortages.

SurvivorA Yen For Gold#1528863/2/07; 09:15:35

@Cometose. You asked:
"DID any fundamental change happen in the last week to

Now, don't get me wrong. . . I agree with GATA's perspective on gold pricing as much as anyone here, but in this case I think natural market forces are playing into the hands of those who prefer a lower gold price.

The reason is the Yen carry trade. Boatloads of Yen have been borrowed at almost zero interest. The currency is then "carried" to other markets around the world where it is invested (maybe "leveraged" is a better term) at higher rates of return.

I think it is inevitable that some of the carry trade funds have been invested in gold - probably paper gold (futures or ETF). We know the gold market is relatively small, so it would not take a lot of carry trade money to have a significant impact on the gold market.

The Yen carry trade operates on a spread of maybe 3% or so. During the last week, the Yen value has increased just enough to erase that spread. So what happens? Speculators get out of their positions and sell those Yen back ASAP. This is the unwinding of a leverage play which affects markets all over the planet.

I believe gold has been impacted by these currency moves. If I am correct, then the effect may be temporary.

- Survivor

KiloNothing New.#1528873/2/07; 09:32:09

When they have stocks to sell, "Equities are the best place to be......"

When they need to support the dollar, "Liquidity is the best place to be......."

Nothing new under the sun !

Au-someCarry trade#1528883/2/07; 10:15:49

"If you think stock markets were the only ones that went haywire this week, look again:

The dollar fell sharply, especially against the yen ... Treasury bonds soared, with the long bond gaining almost a point and a half on February 27 alone ... and gold prices swung all over the place.

In other words, volatility went off the charts in almost every market I track. A volatility gauge maintained by the Chicago Board Options Exchange, for example, exploded 63% in a single day, the biggest increase in U.S. market history.

What single force links all this action? What little (or big!) beast could possibly be behind so many seemingly disparate market moves? Here's my answer … "

Silver FoxTopaz #: 152874#1528893/2/07; 10:17:57

Topaz: thank you for that posting the Internet link to businessjive. I have known for over a decade that the stock market was rigged, I just didn't know how the game was played. I also always thought that the SEC was just another clueless federal agency. But this site does a great job of explaining how the "game" is rigged and that "our" SEC is a willing participant in the scam. Real scary...

All the more reason to own gold.


Thoreauly@ msiwantitall#1528903/2/07; 10:28:13

Terrific presentation that I highly recommend everyone watch.

What's it boil down to?

First we had fractional reserve banking, and now we've got fractional reserve trading.

Or to put it another way, the Mother of All Bubbles has birthed a new one.

In Gold We Trust (buying the dips accordingly).

GoldiloxDarkside#1528913/2/07; 11:49:48

@ Thoreauly,

I remember watching this presentation a few months back, when we were discussing "Naked Shorting". What a racket.

Seems to me that the FOREX is similar, as commercial banks that want to short a currency can borrow unlimited funds from the FED to do so, under their "relaxed" reserve rules.

If this is the case, it is one more "weapon of financial mass destruction" that can be weilded against those who challenge Dollar hegemony.

I believe this is why some state that commodities may divorce themselves from the paper trade at some point, as an FTD in paper is not quite the same as an FTD (force majore?) in goods.

Correct me if I am wrong . . .

mikalOpinions vary on gold market#1528923/2/07; 12:01:08

Gold's steep sell-off was exaggerated by heavy short selling. But numerous factors point towards gold's inclination to rapidly make up for lost time - surprises now will come only on the upside IMHO.
Opinions vary.
But all in all the following two articles, though dead wrong in such places as some assertions by Nadler and Gartman, should help fill any voids of understanding just what I'm saying:
Gold prices drop, on pace for an over $40 weekly loss
Marketwatch - 03-02-07 - Linked
See next post for next article

mikalNext article#1528933/2/07; 12:03:56

Gold's safe-haven status put to test on recent stock scare
March 2, 2007 10:08 AM
Dow Jones Newswires - LONDON (Dow Jones/AP)

TopazDown AND out!#1528943/2/07; 12:10:16$gold:$silver&p=D&b=5&g=0&id=0

It's one thing to wake up to another down day in virtual metals (ho-hum)'s a complete mystery though, in an Ag delivery mth, why the G-S Ratio is backpeddling.
The RSI 30 got me again (it's becoming a far too reliable turn indicator imo and will fail on the next visit) ...surely we'll come back with a vengance next week.

mikalBy the light of the...golden moon#1528953/2/07; 12:47:28

All eyes on eclipse of the Moon
By Roger Highfield, Science Editor
Last Updated: 2:28am GMT 02/03/2007
"If the sky is clear on Saturday night the first total eclipse of the Moon for three years should be visible.
The Moon will appear a shade of brown, coppery-red or orange, an effect that will be visible from all continents.
During the period of totality, from 10.24pm to 11.58pm, the Moon will only be illuminated by light filtered through the Earth's atmosphere.
Its precise appearance depends on the amount of dust in the atmosphere: following the eruption of Mount Pinatubo in 1992, which released large amounts of volcanic ash, the eclipsed Moon was nearly invisible.
As the Earth has not had a major eruption for some years "we can expect an impressive sight", said Ian Morison of the University of Manchester's Jodrell Bank Observatory...

Such an eclipse described in the Bible as the Moon "turned to blood" helped scientists to fix the date of the Crucifixion as Friday, April 3, AD 33."

Mikal--Looking for portents? This eclipse should put on a special show if clouds don't obscure it.
Historic correlations with astronomical events are
often called 'portents' or 'omens'.
But this eclipse may also herald a marvel.

GoldiloxGold's Safe Haven "tested"#1528963/2/07; 13:26:11

@ Mikal,

Totally "yellow press" journalism. Gold had gained over 13% in two months and gave back about half of those gains, and that brings its safe-haven status into question?

My Gawd, what claptrap! The shills are out in force, but then again, they are referring to the "losses" incurred by paper-gold holders much more so than physical advocates.

mikal@Goldilox#1528973/2/07; 13:52:54

Re: "The shills are out in force"
- Think of the mastheads that many of the large papers around the world pride themselves on. The motto part, like "All the news that's fit to print" or the "Mission Statement": "Our purpose...", "We promise...", etc.
They should all at least contain this disclaimer: "May the shill be with you."

Thoreauly@ Goldi re: Darkside#1528983/2/07; 13:53:52

I particularly liked his absolute dismissal of the mainstream financial media. After all, what incentive do they have to publish the truth, when doing so will only crash the economy and send their advertisers fleeing?

And yes, the FOREX the unholy trinity of fractional resserve banking and trading.

And the bigger the bubble gets . . .

flow5A forward look#1528993/2/07; 14:14:27

Golds Course 2/22/07
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.

Suckers Rally 2/26/07
If gold doesn't fall, then there's a new paradigm. The drop in member commercial bank adjusted "free" legal reserves is unprecedented

Everything is copasetic. This retracement is identical to what happend on Black Monday 1987.

First, there is no one on this earth that understands money & central banking. That includes me.

But some people can lose money even if the get tommorrows WSJ today. Everyone pursues their own interests. And everybody has something important to say. I can't think of everything, so I like to read other peoples view points.

I gave you something worth billions. No one else understands, nor is aware of, or believes in the concept of monetary flows (MVt) And since I discovered it, I've never lost any money in gold nor in bonds in 30 + years. I'm not too good in oil, or currencies though.

I'll leave your sanctuary alone.

Just one more thing....

flow5Monetary Flows (MVt) #1529003/2/07; 14:19:00

The transactions concept of money velocity (Vt) has its roots in Irving Fischer's equation of exchange (PT = MV), where (1) M equals the volume of means-of-payment money; (2) V, the rate of turnover of this money; (3) T, the volume of transactions units. The "econometric" people don't like the equation because it is impossible to calculate P and T. Presumably therefore the equation lacks validity. Actually the equation is a truism – to sell 100 bushels of wheat (T) at $4 a bushel (P) requires the exchange of $400 (M) once (V), or $200 twice, etc.

The real impact of monetary demand on the prices of goods and serves requires the analysis of "monetary flows", and the only valid velocity figure in calculating monetary flows is Vt. Income velocity (Vi) is a contrived figure (Vi = Nominal GDP/M). The product of MVI is obviously nominal GDP. So where does that leave us? In an economic sea without a rudder or an anchor. A rise in nominal GDP can be the result of (1) an increased rate of monetary flows (MVt) (which by definition the Keynesians have excluded from their analysis), (2) an increase in real GDP, (3) an increasing number of housewives selling their labor in the marketplace, etc. The income velocity approach obviously provides no tool by which we can dissect and explain the inflation process. Income velocity is used in the Fed's model, the model responsible for our roller coaster economy.

To the Keynesians, aggregate demand is nominal GDP, the demand for serves (human) and final goods. This concept excludes the common sense conclusion that the inflation process begins at the beginning (with raw material prices and processing costs at all stages of production) and continues through to the end.

Admittedly the data for Vt are flowed. So are nearly all economic statistics, but that does not preclude us from using them. An educated estimate is better than no estimate at all. For example, we know that the international balance of payments balances – debits equal credits, payments equal receipts, etc. The Department of Commerce statistics do not prove this, so in order to make their statistics balance, they put in an "errors and omission "balance figure. The triumph of good theory over inadequate facts.

The Fed first calculated deposit turnover in 1919. It reported weekly until 1941 (like M3, the series was also discontinued, in Oct. 1996). The figure "other banks’’ was used until 1996. Prior to this revision Vt included all banks located in 232 SMSA's excluding N.Y. City. This was the best that could be done to eliminate the influence on prices of purely financial and speculative transactions. Obviously funds used for short selling do not contribute to a rise in prices. The Fed calculates these velocity figures by dividing the aggregate volume of debits of these banks against their demand deposits.

In calculating the flow of funds (MVt), I am assuming that the Vt figure calculated by the Fed is not only representative all commercial banks in the United States, but that the velocity of currency is the same as for demand deposits. Is this valid? Nobody knows. But we do know that to ignore the aggregate effect of money flows on prices is to ignore the inflation process. And to dismiss the concept of Vt by saying it is meaningless (that people can only spend their income once) is to ignore the fact that Vt is a function of three factors: (1) the number of transactions; (2) the prices of goods and services; (3) the volume of M. Inflation analysis cannot be limited to the volume of wages and salaries spent. To do so is to overlook the principal "engine" of inflation - which is of course, the volume of credit (new money) created by the Reserve and the commercial banks, plus the expenditure rate (velocity) of these funds. Also overlooked is the effect of the expenditure of the savings of the non-bank public on prices. The (MVt) figure encompasses the total effect of all these money flows.

Some people prefer the devil theory of inflation: "It's all OPEC's fault." This approach ignores the fact that the evidence of inflation is represented by actual prices in the marketplace. The administered prices of OPEC would not be the actual market prices were they not "validated" by (MVt)

Goldilox"It's all OPEC's fault."#1529013/2/07; 14:24:09

@ Flow5,

Anyone "following the money" knows that the largest "royalty" paid any OPEC nation is 15% to the Saudis. The other 85% goes directly to the oil companies for their costs, logistics, and profit.

Filled up mike bike with premium yesterday for $3.26 /gal at the local cut-rate station. Now that the Oil Czars have experienced losses in the elections, they are not the least bit shy about gouging all the people who voted against their princes and princesses.

Goldiloxfit to print?#1529023/2/07; 14:28:39


I called and emailed every San Diego news outlet when the Amaranth story broke, to see who was covering the major losses by the County Employees Union Retirement Fund.

The excuse I got was "It doesn't affect enough of our viewers."

How many of their viewers are affected by the Circus Court proceedings on where Anna Nichole Smith's body is buried?

Major Claptrap and Infotainment!

Sierra MadreFlow5: your quotes from late last month...#1529033/2/07; 15:05:33

Well, congratulations, you were right about the fall. You connect it to the fall in required reserves, if I got it right - as I recall, from about $209 bil to about $90 bil.

Your predictions were correct about gold setting up for a fall. Credit where credit is due.

Interesting that you said this corection will endure to mid-March.

Now, could you PLEASE explain - as if you were talking to a twelve-year-old - WHY money flows had to affect gold the way they did? And WHY bonds rallied?

I am genuinely interested, but somewhat slow on the uptake.


Quixotethank you comex!#1529043/2/07; 15:32:09

because it stands as the price-discovery market for all general forms of gold, the paper sellers in the gold futures pits are making it painless for those of us who are exiting the stock market and wanting to move into the better security of metal at this time.

thank you comex. and thanks also for all the other forms of paper gold that reduce the actual competition from ever reaching metal's doorstep. thank you!

and sincerely thank you forum for the education!

Paper Avalanche@ Flow5#1529053/2/07; 15:43:19

Ditto on what Sierra said.

Thank you for the amount of effort that you put into your posts.


TownCrierYesterday's DMR explained it best of all#1529063/2/07; 16:09:32

The report indicated that jitters set in and gold was hit, along with other financial markets, triggered by the biggest drop in China's main stock index in a decade.

Now here's the key part. Reuters quoted Stephen Briggs, analyst at SGCIB, who said, "Sentiment toward gold is still bullish, what happened this week is a blip, it coincided with a period when gold needed a consolidation period."

Sentiment toward gold is still bullish,
what happened this week is a blip,
it coincided with a period when gold needed a consolidation period.

what happened this week is a blip...


Period. Exclamation point.

. . . . . . . . . . . . .

And indeed, if you look at the page of charts at the URL above, focus especially on the long term charts -- the 1-yr, the 5-yr and the 20-yr charts -- and you'll see that there is NOTHING out of the ordinary about this latest price retracement; it fits in perfectly with the established pattern.

A burger and fries with a beer: $12.50

A gold British sovereign: $176

An accurate 'big picture' perspective: Priceless


TownCrierJonathan Kosares covered the bases back in October. Did you read it?#1529073/2/07; 16:19:00

Gold market volatility: Has it changed the fundamental reasons for physical gold ownership?

(J. Kosares 10/17) -- Volatility in the gold market is here to stay. Thus far in 2006 gold has been as low as $525 and as high as $725, sometimes changing $50 or more in a single week.

Friday, October 13th's price rise of $12 marks the 50th day this year that gold has moved more than $10 in a single day in either direction.

By comparison, only nine days in all of 2005 showed moves of more than $10, and all nine occurred in the last three months of the year.

This essay offers one possible explanation for this erratic price movement related to the rapid growth of hedge funds and their investment tactics, and also speaks to the mounting systemic risk if these practices continue to proliferate...

^___(click URL to read the full text)___^


Titan685 to 640 in a week#1529083/2/07; 16:43:27

I know there are reasons why the POG did what it did this week. But it's hard not to be a little blue about seeing it back below 650 again when it was on such a nice upward path! Well, I guess we just get to watch it start climbing up again. Here we come, 700... 800...
CometoseCOT#1529093/2/07; 17:38:59

For options and futures for the the week the Commercials

in SIlver were net short 10000 contracts

in COpper were net short 1600 contracts

in GOld were net short 14000 contracts

USAGOLD Daily Market ReportPage Update!#1529103/2/07; 18:19:20">
The Daily Gold Market Report has been updated.

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

FRIDAY Market Excerpts

Gold sold to raise cash for other market losses

March 2 (Reuters) -- The global flight from risk knocked gold and silver hard for a third straight day on Friday, with bullion falling below $640 an ounce for the first time in 1-1/2 months as funds and currency investors cashed out on precious metals to pay for losses in other markets.

Many investment funds were seen to have bought commodities, including gold, over the past month with the proceeds from stocks as Wall Street reached record highs last month.

The COMEX April gold futures contract settled down $21.00, or 3.2 percent, at $644.10, after bottoming at $641.30, a 1-1/2-month low. It hit a session high of $668.20.

Carry trades, in which investors use low-yielding currencies like the yen as a cheap source of funds to buy higher-yielding currencies and assets, were largely to blame for Friday's sell-out in gold futures, analysts said.

This is because the yen rose to an 11-week high versus the dollar, and currency traders needed to close out their positions in gold futures to unwind bets on riskier assets that were financed by borrowing the Japanese currency.

"It seems that traders that are in the carry trade are obviously continuing their mass exodus. The money is coming out of gold and silver, mostly futures, where many of the carry traders have used gold and silver to park some of their carry trade profits," said Phil Flynn, vice president and senior market analyst at Alaron Trading.

James Steel, analyst at HSBC, said that general weakness in the emerging markets was a big factor in gold's decline. "Near term, I am still a little bearish. But I think it's going to be fundamentally very attractive quite soon. We will have to see how much further the correction has got to go."

Gold is often used by investors as a safe haven in times of financial uncertainties, but analysts said that this time funds opted for cash and to pay off losses because of the equities rout.

"It's one thing for people to run around and say it's a great diversifier and a safe haven to all the risks. But the fact is, when things start going bad, people tend to liquidate their gold holdings in order to pay for the bad stuff," said Bernard Hunter, director of precious metals at ScotiaMocatta.

"When equity markets start going down badly in particular, and people start getting calls for margins, gold seems to be one of the first things that people liquidate in order to raise cash to pay for losses on other products," Hunter said.

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

TownCrierPaulson says ... volatility a facet of markets#1529113/2/07; 18:30:29

WASHINGTON (AFP) - US Treasury Secretary Henry Paulson said Friday that the global and US economies were "strong" and that volatility is a facet of stock markets following heavy losses on Wall Street.

Paulson, in an interview with National Public Radio, said the US economy was shifting gears into a more sustainable pace of growth.

He spoke as a fresh wave of selling hit Wall Street Friday afternoon as economic concerns resurfaced and investors retrenched ahead of the weekend break.

It marked the third day of losses in the past four sessions and followed Tuesday's global stock rout which triggered the worst slump in US shares since the aftermath of the September 11, 2001 terror attacks.

The Dow Jones Industrial Average closed down a hefty 120.24 points as investors remained nervous over US economic growth.

^___(from url)___^

The lesson here is that metal volatility is not unique. Stock investors are feeling some pinches, too.


smiles45Total Net Commercial Shorts Up thru Tuesday-Good or Bad?#1529123/2/07; 18:33:40

Comatose, I think this week's gold COT report is highly misleading. Let me explain. Thru Tuesday the Commercial total net shorts stood at -194,000.(321Gold Hot COTs)
Normally that would be a signpost showing the trade feels a market down turn is iminent(but not). It takes weeks for them to build up their position. The net Big speculators (read hedge funds) added 10,600 contracts for a total of +149,000.
The worrying part is the trade had perfect cover story by the Tuesday delayed statistics which is always case. Wed thru Friday the Comex traded 353,000 contracts (very large volume).The POG ranged on those days $680 down to a close of $642 almost a $40.
My point is these Commercials buy on dips and sell rallies and it is virtually impossible that their selling continued thru Wed-Fri. In my experience a 3 day volume move like that would generate anywhere from 10,000 to 20,000 contracts being covered each day. This would drop net shorts to aproximately to -140,000. The inclusion of next Monday & Tuesday's figures could include (assuming the market is lower and hedge funds sell as they always do on selloffs)an additional 20,000 to 40,000 lower shorts to the 100,000 total net short area.
The Commercials have about a 70,000 fixed(never below) short hedge positions for miner's (this figure has been relatively constant lately). This would mean that with an additional covering of 30-50,000 shorts Wed-Fri next the POG correction could culminate. But from what price everyone is asking?
Tradionally, POG stops at about the 200 day EMA(expotential moving average) or somewhere in between the 200 & 300EMAs.
The 200EMA is currently $620 & the 300EMA at $600. I feel somewhere in between POG will bottom $610-$615.
The RSI should be 35 or below(under 30 best), a MacD at -0-to -5 area,a CCI -300 to -400, an ROC -15 to -20, and most importantly an Aroons # should be near -95 to -100( -100 is best). So far the indicators have dropped nicely towards those targets./Peter

TownCrierPaulson -- Markets Don't Always Represent Economic Fundamentals#1529133/2/07; 18:42:11

In an interview with National Public Radio, U.S. Treasury Secretary Henry Paulson said,

"For at least as long as I have been looking at markets, there is volatility in markets."

"Markets at any one time don't necessarily reflect the economic fundamentals in markets - certainly you don't move in a straight line one way or the other forever."

"So as long as you have markets, you're going to have volatility."

Paulson said the United States was "really pressing" China to move forward with financial market reforms to enable markets to determine the valuation of the yuan currency.

"We would like their currency to appreciate. We would like it to more adequately reflect the economic fundamentals."

^___(from url)___^

Do you REALLY want to be holding dollars as your long-term form of savings when U.S. monetary authorities are openly and actively pressing for the dollar to beceome relatively weaker?

Tangibles are where it's at. Choose gold. As a reliable source of ready, liquid funds, this week it is simply doing its job for those wrong-footed folks that are being massively squeezed for cash from one direction or another.

Paper AvalancheCan I post a link to Jim Turk's commentary and graph?#1529143/2/07; 18:56:14

Randy, MK or Admin,

I want to make that I don't break a forum rule.

His graph this week puts it all in perspective.

Please advise.


GOLD FINGERTGIF and gold is a bargin!!#1529153/2/07; 19:02:02


Great weekend to plan my gold's a deal!!

Take this oppertunity when this is low to stock up!


TownCrierPaper Avalanche,#1529163/2/07; 19:09:18

Very frankly, I'm embarrassed to admit that I really don't know. In all things, it's ultimately MK's call. Maybe he's nearby and can chime in.


Silver FoxHahaha#1529173/2/07; 20:04:12

Are you watching the POG & POS?

The "insiders" are really on a roll this week.

Sooner or later, their transaction will be in the "light".

Talk about a buying oppurtunity!!!


mikal@Chris Powell#1529183/2/07; 20:46:21 Thanks for the GATA dispatch linking to Peter Grandich
Grandich Letter Special Alert - Goldseek - 02-02-07 4 pm ET

mikalWe are the bulls#1529193/2/07; 22:01:55

Chris Powell and myself are not the only ones that
value the opinions, advice and humor of James Sinclair.
I must say he is one of the few that can approach gold and relevant world events objectively, from multiple perspectives and disciplines, and articulate it freely, clearly and casually.
With such fresh developments an essentially daily routine
it frames his unique approach to gold commentary and it's very special place in a fast-changing world.
"Market Summary", gold and silver analysis, currencies, and much more (even linked through a GATA dispatch Friday):

mikalSubject or object- which comes first? Both. And neither.#1529203/2/07; 22:27:23

I said JS has an "objective approach". I did forget to add that sometimes he is subjective- I don't agree with everything JS writes or speaks when he appears on the tele(such as the Bloomberg tv interview), on radio, etc.
Over time though, our views have merged like many bulls
and web surfers, lurkers, posters, chatters etc.
In this day and age, as Peter Schiff just recently commented, there has been information evolutions, internet revolutions and communication transfers unprecedented and unstoppable.
As difficult as it is for us all to come to terms with, everyone must have their own
unique, completely subjective vantage point from which to assess the world and it's
most puzzling aspects, such as the gold market- so that the seed of our lives remain vibrant and fresh, not barren and infertile- within the mutual parameters of objectivity, this place we call ego, self, me.
Subject or object- which comes first?
Neither and both.
"There is nothing new under the sun."
In the final analysis, we are one. All things go out from HIM and return thereto.

mikalWorld begins asking "Anybody home"?#1529213/2/07; 22:50:33 Army secretary removed amid veterans' scandal
Kristin Roberts - Reuters - Feb 02, 2007 Yahoo! News
The reputation of the dollar takes another blow

mikalMore on Saturday's eclipse#1529223/2/07; 23:00:08 Eclipse set to be 'best in years' | BBC NEWS | Science/Nature | March 2, 2007
Details such as when, where the best view is seen(map included) & stages of eclipse.

mikalEclipse in N.America info#1529233/2/07; 23:14:02 Total lunar eclipse Saturday night - - Mar 02, 07
A short one mainly for the N.American experience, with times in EST and other specifics. Enjoy.

mikalDerivatives doo doo#1529243/2/07; 23:28:11 Goldman Sachs, Morgan Stanley, Merril Lynch Almost 'Junk' Their Own Traders Say | Exclusive - March 02
GoldiloxLunar Eclipse#1529253/2/07; 23:31:13

Best viewing is a couple hours east of the GMT time zone, so most of the US will miss this. Should be quite nice in Rome or Athens.

It occurs from Noon to 4PM PST.

mikal@Goldilox#1529263/2/07; 23:43:19

"Go EAST, young man." ;)
mikalDollar not easily understood#1529273/2/07; 23:55:08 U.S. investors, meet the rest of the world - Stocks & Economy - - AP - March 2, 2007
This article advocates for, or at least expects Fed easing, lower interest rates as a means of supporting the stock markets.
But in closing, it maintains that the yen carry had a large role in the global stock selloff and that the yen will continue to rise and the dollar to fall.
So lowering rates wouldn't work for stocks either way.
A catch 22 right under the author's nose.

SundeckEclipse#1529283/3/07; 05:47:48

It is not commonly realised, but there are always at least two lunar eclipses every year, in contrast to solar eclipses, that are relatively uncommon.

Most lunar eclipses are "partial", but the one tonight will be total. They can only be viewed from the night hemisphere of the Earth; except for the comparitively rare selenehelion events (see link).

Nothing to do with gold, of course, except for the Moon's colour...



Cometosestrange#1529293/3/07; 06:27:55

the junior sector held up considerably better
than the road more traveled......... this week

that is very encouraging .....

indicating to me that this business is a blip

Hopefully the bargainhunters with fresh (equity) cash will find gold and silver irresistable come Monday morning

CometoseSilver/ continuous contract quote versus near month#1529313/3/07; 06:57:26$SILVER&p=D&b=3&g=0&id=p26821412816

I might be trying to sound too positive , but the divergence and discrepancy indicates to me , we might have gotten a little overdone on the down side in silver......

Hope springs eternal from the fountain of hope inside and the endorphins in my brain that rally forth therefrom

i will be buying more silver some day ; two road diverged in a yellow wood , and I took the one less traveled by ...

Do you think that Robert Frost was a GOLD BUG TOO......

perhaps yellow is a reference in symbolism
GOLD ........


flow5Member Commercial Bank Adjusted "Free" Legal Reserves#1529323/3/07; 08:06:52

163.986.10.19-0.091998-12-01 6.72
164.388.50.290.211999-01-01 6.79
164.583.40.000.031999-02-01 6.81
165.083.0-0.17-0.081999-03-01 7.04 6.92 7.15 7.55
166.782.90.13-0.041999-07-01 7.63
167.182.2-0.15-0.101999-08-01 7.94
167.987.00.090.151999-09-01 7.82 7.85
168.3100.71.730.501999-11-01 7.74
168.3115.43.241.091999-12-01 7.91
168.898.11.540.622000-01-01 8.21
169.882.2-0.32-0.082000-02-01 8.33
171.280.4-0.43-0.222000-03-01 8.24
171.381.6-0.13-0.082000-04-01 8.15
171.584.40.21-0.012000-05-01 8.52
172.483.4-0.360.062000-06-01 8.29
172.883.7-0.530.072000-07-01 8.15
172.882.6-1.81-0.012000-08-01 8.03
173.783.1-3.230.062000-09-01 7.91
174.082.4-1.56-0.052000-10-01 7.80 7.75 7.38 7.03
175.880.7-0.37-0.102001-02-01 7.05
176.280.1-0.34-0.112001-03-01 6.95
176.980.5-0.33-0.212001-04-01 7.08
177.783.80.13-0.042001-05-01 7.15
178.082.8-0.03-0.012001-06-01 7.16
177.584.20.180.082001-07-01 7.13
177.583.2-0.13-0.162001-08-01 6.95
178.3105.11.920.672001-09-01 6.82
177.790.40.32-0.432001-10-01 6.62
177.486.80.61-1.192001-11-01 6.66
176.789.50.95-0.362001-12-01 7.07 7.00
177.887.80.400.312002-02-01 6.89
178.886.20.350.192002-03-01 7.01
179.887.10.280.112002-04-01 6.99
179.886.90.370.142002-05-01 6.81
179.985.5-1.950.072002-06-01 6.65
180.186.2-0.420.152002-07-01 6.49
180.785.8-0.090.112002-08-01 6.29
181.087.9-0.160.232002-09-01 6.09
181.388.7-0.300.182002-10-01 6.11
181.390.40.260.192002-11-01 6.07
180.993.60.740.272002-12-01 6.05
181.794.10.710.562003-01-01 5.92 5.84 5.75
183.891.00.480.302003-04-01 5.81
183.591.80.600.382003-05-01 5.48
183.791.30.340.302003-06-01 5.23
183.994.00.530.452003-07-01 5.63
184.695.10.47-0.412003-08-01 6.26 6.15 5.95
184.595.70.520.262003-11-01 5.93
184.396.80.720.212003-12-01 5.88 5.74 5.64
187.493.90.250.282004-03-01 5.45 5.83 6.27
189.796.20.090.422004-06-01 6.29
189.495.70.120.412004-07-01 6.06
189.595.2-0.050.302004-08-01 5.87
189.998.40.160.412004-09-01 5.75
190.996.1-0.160.242004-10-01 5.72 5.73
190.396.90.300.122004-12-01 5.75
190.799.70.430.392005-01-01 5.71
191.896.00.010.262005-02-01 5.63
193.395.0-0.130.172005-03-01 5.93
194.695.70.010.162005-04-01 5.86
194.494.6-0.050.142005-05-01 5.72
194.595.5-0.300.062005-06-01 5.58
195.495.5-0.060.012005-07-01 5.70
196.494.8-0.23-0.022005-08-01 5.82
198.897.50.060.132005-09-01 5.77
199.295.8-0.380.012005-10-01 6.07
197.697.10.120.012005-11-01 6.33
196.897.40.24-0.012005-12-01 6.27
198.3101.50.580.312006-01-01 6.15
198.795.00.040.052006-02-01 6.25
199.893.5-0.20-0.082006-03-01 6.32
201.593.8-0.17-0.082006-04-01 6.51
202.594.5-0.03-0.072006-05-01 6.60
202.995.2-0.23-0.022006-06-01 6.68
203.594.8-0.11-0.022006-07-01 6.76
203.993.8-0.33-0.192006-08-01 6.52
202.994.7-0.27-0.062006-09-01 6.40
201.893.0-0.85-0.172006-10-01 6.36
201.593.6-0.14-0.142006-11-01 6.24
201.895.70.22-0.162006-12-01 5.32
202.497.60.380.072007-01-01 6.22

canamamiGas Crunch in Ontario#1529333/3/07; 08:30:59

A harbinger of things to come?
GoldiloxReserve numbers#1529343/3/07; 08:47:16

@ Flow5,

Do you have labels for the columns of reserve data you posted? I can guess a couple of them, but I often guess wrong.

flow5Monetary Flows (MVt)#1529353/3/07; 09:32:12

Sorry, posting the numbers, squeezes the data. The examples are not comprehensive, just some -- turning points.

(1) The stock market rebounded in Oct. 2002. Coinciding with the rebound was a turn in the rate of change (roc) in (Monetary Flows (MVt); for all historical purposes, debits corroborate -- "Free" Legal Reserves). They are symmetrical. I can't explain the lags, it's just an observation, but they've been constant since 1919.

I originated the roc's, but not the theory. No one else uses the info. And if you know Joseph Granville, of the Granville letter, you might remember in Sept. 1981, his on-balance-volume data, were set to register a market bottom, but so many subsribers anticipated this, that they bought into the market and prevented his prediction from coming true. The lesson is, you can't tell everyone the gospel, or it will stop working.

(2) The stock markets top in the first quarter of 2000 conincided with a +3.24 (roc) in Dec. 1999, which subsequently fell to -.32 in Feb 2000. Now that's an historic reversal!

(3) In Oct. 2002, the stock market hit a bottom. "Free" Legal Reserves (roc) reversed from -30 to a +26 beginning in Oct. 2002 and never looked back. That's not a conicidence. That's called a (roc) of real money in excess of real inflation - CPI, etc.

(4) When Bernanke was appointed Chairman, he initiated a tightening process. There was a succession negative real GDP (roc's) from Feb. 2006 until Dec. 2006, but inflation persisted, and the Fed was still trying to wring inflation out up until Jan. 2007. That was the motivation for sopping up reserves (the largest decline in history). Bernanke wouldn't have had a problem, but his technical staff still adhere's to the fallacious real bills doctrine.

(5) Black Monday in 1987 was the direct result of the fed soaking up reserves. Reserves declined at their steepest rate since 1915.

The (roc's) for both real GDP & inflation reversed to the downside in Feb. 2007.

(6) Bonds turned around in July 2006, a reflection of the fed tightening. Tightening reserves raises long-term rates in the short run, but lowers long-term rates in the long-run.

(7) This year, Feb. 2007, reserves declined at their sharpest rate ever. The Fed's staff, which didn't understand "Black Money" made the same mistake this year. The market decline in China was the direct result of Bernanke's policies. I love him. He's a sly dog.

And you can't always use the numbers because of changes in reserve requirements and changes in assets eligible for reserve ratios. And so it is obvious no one at the Fed, no professional economist, and no university professor has caught on.

GoldiloxLABELS#1529363/3/07; 10:25:40

@ FLOW5,

I understand about squeezing the data when moving from one application to another, but what does each column of data represent? There looks to be about 4 or 5 columns there of pure numbers with NO LABELS.

Please elaborate.

USAGOLD / Centennial Precious Metals, Inc.Spot the bargain#1529373/3/07; 10:56:52

shop for gold coins
TownCrierZimbabwe gold mining on the brink of collapse#1529383/3/07; 11:08:41

Harare - Zimbabwe's gold mining companies have been pushed to the brink of collapse due to a fixed exchange rate and soaring production costs, a leading gold producer said on Friday.

Miners sell gold to the Reserve Bank at ZIM$16 000 per gram, which is about $64 (about R470) at the official exchange rate...

The Zimbabwe dollar is officially pegged at ZIM$250 against the US dollar, but trades more than 30 times weaker on the black market, while the ZIM$16 000 per gramme price for gold has been fixed at current levels for five months during which inflation has risen by almost 400 percent.

...a Zimbabwe Stock Exchange listed mining company, warned in a statement to shareholders that the industry could no longer sustain operations in the face of rising costs and falling revenues.

"Without a realistic increase implemented shortly, this company, in fact, the whole gold mining industry in Zimbabwe, faces imminent collapse," FalGold chairperson Gary Perotti said in the statement. "No business can sustain an environment where rapidly increasing costs are matched against fixed revenue."

...Several mines have closed amid a worsening business environment characterised by exchange rate problems, inflation at almost 1 600 percent and serious foreign currency shortages that have made it difficult to import equipment...

Jitters over President Robert Mugabe government's plans to take control of foreign-owned mines have also seen limited exploration and mine development.

Mining output declined by 14.4 percent, while gold deliveries to the central bank were 18 percent down to just under 11 tonnes last year.

^___(from URL___^

Sending thanks once again to my friend, G, for this link to a highly instructive article. Read it at least twice, folks, and then make a decision to choose freely floating metal over mining shares and other market regime.


Chris PowellWhat treasury secretary might be telling Asia#1529393/3/07; 11:45:56

1:41p ET Saturday, March 3, 2007

Dear Friend of GATA and Gold:

The U.S. Treasury Department this week announced that Secretary Henry Paulson will visit Asia next week. Here is Treasury's press release.

* * *

U.S. Treasury Department Press Release
Thursday, March 1, 2007

Treasury Secretary Paulson
to Visit Tokyo, Seoul, Beijing,
and Deliver Speech
in Shanghai Next Week

Treasury Secretary Henry M. Paulson Jr. will travel to Tokyo, Seoul, Beijing, and Shanghai next week to meet with government officials and local business leaders. The secretary will deliver a speech in Shanghai on March 8 at the Shanghai Futures Exchange.

The secretary will be in Tokyo on March 5-6 to hold bilateral meetings with Prime Minister Abe, Finance Minister Omi, Bank of Japan Governor Fukui, Minister for Economic and Fiscal Policy Ota, and Financial Services Minister Yamamoto, among others.

He will travel to Seoul on March 6, where he will hold bilateral meetings with President Roh, Deputy Prime Minister and Minister of Finance and Economy Kwon, and Trade Minister Kim.

He will meet with Vice Premier Wu Yi in Beijing on March 7 before going on to Shanghai. While in Shanghai, Secretary Paulson will meet with financial sector leaders and local government officials, and deliver a speech on Chinese financial markets reform on March 8.

* * *

GATA's friend Peter Berry imagines Secretary Paulson's remarks to the Asian officials this way:

To Prime Minister Abe and his colleagues in Japan: "Good job. Your profits are waiting as agreed. Now please weaken the yen again, as the unwinding of the yen carry trade is making us dizzy and I need to return to the United States with something positive."

To President Roh and his colleagues in South Korea: "We think that our rapprochement with your family members across the 38th Parallel will provide you excellent markets for your (over)production. (While our own markets freeze up and will be closing soon. Sorry about that)."

To Chinese Vice Premier Wu Yi and the apparatchiks in Shanghai: "This is win-win. With your help, we've succeeded in lowering the price of gold and obtaining scarce physical by shaking the GLD tree to the tune of more than 3 million ounces in the last week. No one in the West believes in the metals anymore, and we will continue to beat back the price as well as we can to meet your reasonable demands to exchange our paper and electronic credits for something tangible. And now, if you will allow my colleagues and me, we can rig your markets for you better even than you can for yourselves."

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

* * *

To subscribe to GATA's dispatches, go to:

TownCrierA helicopter story: Geithner says Fed ready to act if financial crisis erupts#1529403/3/07; 11:49:42

WASHINGTON (MarketWatch) -- The Federal Reserve stands ready to lower interest rates if a financial crisis erupts, said Tim Geithner, the president of the New York Fed, on Wednesday.

"As always, central banks need to stand prepared to make appropriate monetary policy adjustments if changes in financial conditions would otherwise threaten the achievement of the goals of price stability and sustainable economic growth," Geithner said in a speech about liquidity in financial markets to a business group.

^___(from url)___^

Just gotta love that elastic money supply -- when the business climate and investments hit the skids, the Fed is not shy about sacrificing the value of the dollar in order to help refloat everyone's boats.

With unlimited waves of cash always looming on every horizon, a flood ever-ready to be unleashed, the wise person does not use the dollar for savings. He or she chooses gold -- because Mother Nature does NOTHING to sacrifice its value (that is, does NOT increase its supply) as the wayward monetary tides rolls the wreckage to and fro, buoyed as it all is on a sea of ever-devaluing dollars.


Lackluster; 11:57:27

But Towncrier, from your URL:

"Geithner said his remarks were general in nature and not related to "the specific conditions of the moment" where the stock prices plunged around the world."

Sounds like cold comfort.

TownCrierLackluster: Geithner said his remarks were general in nature...#1529423/3/07; 12:22:22

Of course. God forbid that a Fed official ever provide anything more SPECIFICALLY relevant to a current event than "The Fed does not comment on current market events."

However, the general lesson to be generally gained about the Fed's general policy toward life in general is generally that the quantity of money in the system will be generally goosed (and its value generally sacrificed) whenever specific conditions generally warrant as guaged by a generally political assessment of conditions.

When this lesson is learned to the deepest fibre of your being, the only choice for savings becomes tangibles -- with gold chosen specifically as the liquid component of ones accumulation of wealth.


Lackluster(No Subject)#1529433/3/07; 13:19:57

No, I know. My post was tongue in cheek. I am not sure how Geithner expects anyone to believe "...his remarks were general in nature..."
flow5Columns#1529453/3/07; 13:24:38

Cpi, legal reserves, 10 month rate of change, 24 month rate of change, date - year, month, 30 year mortgage yield
flow5source#1529463/3/07; 13:26:58

sometimes you don't want to swim upstream (if everyone else uses seasonally mal-adjusted data).

figure is not seasaonlly mal-adjusted.

mikalLast night's news#1529473/3/07; 14:04:08 well as this morning, a flood of press reports
appeared about Bernanke's speech last night.
Most of them were headlined with some variation of:
Bernanke says globalization is causing inflation
Some others were restatements from the past about "the good economy" or "Bernanke is satisfied".
This is little different than Geithner and the Fed circle's "achievement of the goals of price stability and sustainable economic growth", wielded in various settings as a universal, one size fits all slogan!
With GDP revisions after GNP revisions after original productivity measures, there is no semblance of concern
about the economy actually shrinking outside of an elite intelligentsia that know better and mostly don't live here.
Same with "price stability", which is no less a fiction in Switzerland or Japan or EU or Britain than the US of A.

mikalRe: "productivity measures"#1529483/3/07; 14:11:54

Is actually 'after original growth and productivity
measures'. Both of these are fictions, and more are due out this coming week, among other things. Interesting also that these kinds of figures get played up and any other stats get little or no mention.
An article in Bloomberg this week made mention of the contrast between 'anecdotal evidence' and stats showing slowing vs. other reports and that Fed and investment decisions relied upon a resolution of this.

GoldiloxMVt Labels#1529493/3/07; 15:03:30

@ Flow5,


I would have guessed one or more of them wrong!


GoldiloxGlobalism and Inflation#1529503/3/07; 15:21:14

While everyone loves to expound how decreased labor costs are the great benefit of Globalism, not a word is ever heard about how increased transport and security costs may offset or even exceed the savings generated.

As fuel prices rise drastically, the cost of transportation has dwarfed the cost of labor as a component of production and distribution.

Example, the $1 tennis shoes from China that still adorn US retail shelves at $100 or more contain much more than that $1 manufacturing cost in transportation, security, and marketing costs. I have no figures as to the precise comparison, but I am sure they would be interesting, if anyone does.

At what point does the rising transport and international security cost start to again favor local manufacturing?

The bulging Iraq war budget essentially puts a heavy toll on "raw materials" that is never amortized in any reports.

As Bucky Fuller once quipped (paraphrasing), "A society whose security and maintenance costs out-weigh its actual productivity, is experiencing regression, rather than progression."

GOLD FINGERWhat do you think about the "Big Boy's" keeping the majority POOR?#1529513/3/07; 18:24:08

How lucky are you?

I think the hidden truth is many of the big bankers and others in political power try keeping the poor class in that state is good for the economy...correct?

This may be a general idea and maybe even a broad thought, but, I do feel that some of the ingenious things that Mr. Bernanke says and dose and will YET do, will be in effect to knock down the world economies.

I think that when Mr. Greenspan commented last week on the idea that we might be headed for a recession was not to far off from the truth and I didn't hear Bernanke say it was incorrect.

I think depressions and recessions and high inflations are all cyclical. The goal is to keep enough people hungry who will work for peanuts and thus keep making the "excess" that many GLOBALLY GOBBLE UP!!

This is not just an American issue! It's a World Wide issue.

I think we will hit a recession and maybe even a depression!! Buckle down the hatches boys, it's going to be a rough ride. History repeats it's self right?

Happy Golden Weekend~


This leprechaun has a wee pile of gold (physical) and I am feeling even more lucky knowing so!!

GoldiloxWizards of Money and Money Masters#1529523/3/07; 19:23:27

@ Gold Finger,

Try these on for size, courtesy of Kilo, posted 2-17-06

Money Masters Part 1:

Money Masters Part 2:

The other really good one is Smitty's "Wizards of Money", which is a little older and has "made the rounds" of websites, so to speak. Haven't been able to find the original version lately.

They are both excellent primers to the point that "economics" is but a fiction designed to keep the same "privileged few" in power generation after generation.

mikalGold is only months away from complete resurrection#1529533/3/07; 19:26:01 The Gold-Plated Sting by Gary North - March 3, 2007
The sting institutuionalized around the world by insider bankers/central bankers confiscated honest money permanently says Gary North.
In the U.S. he insists, it was because two lies gave us a government-guaranteed, gold plated, gold standard.
But I agree with him you can't get "something for nothing" forever.
Therefore, what lies ahead is not so much a multi-year bull market in gold( if such a market in gold really exists in the classic sense), but a new paradigm in the midst of, or the incipient stages of, or on the doorstep of implimentation. Simply, a paradigm shift is occurring as we speak.
The stable state of the global economies cannot survive relentless exponential debt growth coupled with derivative
growth and inevitable, progressive failure(starting now with MBS's, hedge funds, junk bonds)- precipitated by both flawed CB and gov't policy and current dependence on the fraud of leveraged, unbacked paper promises- CB interest rate and money supply decisions are being exposed as naked shorting of citizens' savings and leaving only months or perhaps weeks bfre large institutions and fund managers
reach the limit of confidence in the IMS and it's reserve model.
IMHO and NIA. Do your own due diligence and good luck.

mikalTypo edit#1529543/3/07; 19:29:59

Typo: before, NOT "bfre"
GoldiloxClass distinctions#1529553/3/07; 19:31:05

@ Gold Finger,

Two excellently researched treatises to that effect are:

Money Masters videos (linked by Kilo on 2-17-06)

and Smitty's "Wizards of Money", which has made the internet rounds, but landed I don't know where.

Both support the theory that "economics" as we experience it, is but a fiction designed to enable major political power to pass from generation to generation in the same bloodlines.

GoldiloxSorry for the repeat post#1529563/3/07; 19:32:52

I thought the first one didn't make it.

- Department of Redundancy Department

slingshotA Story to Brighten Things Up.#1529573/3/07; 19:39:56

Well TPTP sure beat us up the past couple of days.Yet I'm not worried about it. Nothing really has changed that I can see. This story is true for it happened today. My hot water heater gave up the ghost with a vengence. Not only did it stop heating but began to leak. What has this to do with GOLD? Hang on, I will get to it. Only after major frustration and the need to fix the problem does one see a coalation. Before I continue I would like to say if your have a plumber,electrician,car mechanic or carpenter for a friend they are like gold. I treat them with respect when they make house calls. But for me I always give it a try first and hope I do not do too much damage before I call in the calvary. If you are a do it your self type, you understand the learning curve and equate the education of gold is par with any trade. Lots of variables and even with my long trips to and from the supply house I find I learn something new each time. And so it is with gold as each retracement occurs we learn more about the markets.
My point is that when it all goes down will you have the time to repair it (Financial). This is just an inconveinence (Cold Showers) but a great motivation to get the job done.
Another good point is you have all the info at USAGOLD about Gold and you don't have to make many trips.
An admission that I did feel the hot water was cooling in the shower long before the incident.
The writing is on the wall. Like my hot water heater. Sooner or later the FED has got to do something! Doing nothing is not gonna make it.
Smile everyone ;0)


slingshotGold Finger, Keeping the majority poor#1529583/3/07; 20:37:10

Well Good Knight, I think that is what it is all about.
One only has to recall the comment of Ford and especially Rockerfeller's comment about serfs, that you can see they don't give a damn and are Hell Bent to the New World Order.
You can see that more and more others in the backgroud(Like Kissenger) are brought back into the picture for advise. WHY? Do we not have any upcoming people who have newer ideas or are we staying the course. Refusing any new paths. Such is Greenspan. If he wanted to stay on scene then he should of held the job and not undermind Bernacke. If Paulson is running the show with the plunge protection team ,why do we have Bernacke? So it all comes down to Who Is Running The Show!

Gold Finger that is a Great Question but I am afarid I might run outside of the parameters of Forum Rules.


mikalChina#1529593/3/07; 20:48:20

This could just as well be India, Taiwan, Turkey, Russia etc.
China Seeks More Channels to Use it's Foreign Exchange Reserves - ChinaView - Xinhua - March 3, 2007
Reserves "quintupling in the last five years" are "still growing".
China "is seeking MORE (emphasis mine)channels to use it's massive foreign exchange reserves, economists said" before the 12 day, annual meeting begins(today) of "the country's TOP political body".
This meeting closes in 12 days, so that puts them two weeks(approx) shy of the end of the fiscal year for many Asian nations,
and two weeks (approx.) from now.

slingshotRecognition#1529603/3/07; 21:13:06

There are times we post and we feel nobody is paying attention to what we write. I wanted to say I read your posts. Sometimes don't understand it, but read it the same as to one day I might catch on.
Topaz,melda laure, cometose,flow5,mikal Druid,kilo,AuSome,
Silver Fox,msiwantitall,Goldilox Thoreauly,Sierra Madra,Quixote PaperAlvalanche,Smiles45,Gold Finger.Black Blade, Gandalf the White, Waverider,and Belgian.

**** Sir M.K., Towncrier, Marketalk ****

There are a Noble Bunch ;0)

Come on your Lurkers and Newbies. Join the fun.

slingshotunder surveilance?#1529613/3/07; 21:40:20

I happen to run across a link which involved our neighboring castle,as to WHO is looking at their posts. Lots of firms and people. I had to wonder why as we make up such a small percentage pertaining to gold. Surely if we are a small percentage, why would they have concern? And I am sure, as we are in only bullion, they have turned an eye towards our forum. While the media and market shrills downplay gold, it is odd that so many companies visit our sites. The mantra is gold is dead, and barbaric sounds aloud, while the undercurrent is to accumulate.
Strange indeed.

slingshotHeyTopaz#1529623/3/07; 21:52:34

Your on the wire?

slingshotGeorge and the Time Monks#1529633/3/07; 22:15:54

Don't know if your see George from Urbansurvival on the History channel but he may be on to something concerning 2012. But Bennie and the Fed, has electric boots, a mohair suit, and you read it in a magazine. Oh, Oh.
Bennie and the Fed. Has him Beat.

mikal@Slingshot#1529643/3/07; 22:18:59

Good posts. Thanks for the info on GE site. I like to hear what's happening around the web. I wonder what the web bot Goldi visits said about the past week(did it predict any or all the goings on?).
Mother Goose was the name for an anonymous collection of folk nursery rhymes. One very short one is called The Crooked Sixpence. Mother's goosing the house of cards?

The Crooked Sixpence
There was a crooked man, and he went a crooked mile,
He found a crooked sixpence beside a crooked stile;
He bought a crooked cat, which caught a crooked mouse,
And they all lived together in a little crooked house.

mikal@Slingshot#1529653/3/07; 22:28:48

Here's the plan (modus operendi, secret hidden agenda, code of honor):
If we get to the year 2012 and NOTHING happens(at all),
it's plan B, the Y2K routine- we make like we knew it all along and then predict IT happens a couple more years out, it'll keep us employed and the subjects happy. I assume you're going to be aboard. ;)

slingshotmikal#1529663/3/07; 22:34:52

One of my problems is that I do not make the connection between pivitol points as fast as others. This financial game is hard for me as it gets more complex as the it progresses. This may be what scares those who are at a point to enter the gold arena. It is hard and I have been at this Forum for a few years. I am for the Small time investor for I am one.

GOLD FINGERWhat could I possibly say.....#1529673/3/07; 22:35:52

...that anyone would like to read?

I am not sure other then I sometimes write for myself in a way of therapy and perhaps a form of venting.

Good? Bad?

I am not sure. I can understand many points of views and I do like the economic trivia and charts and graphs.

I try to stay clear of to may chat url's and write down what I may be feeling in regards to current economic times and how we are all being effected with this new globalization.

I think this is a new word for my generation. In the old days things were different. Now days so many other issues are at hand and I never realized what happens in India or China could have such a huge impact on me and others.

The working class are being stampeded away. Who's going to be left to provide for all the entitlements?

I am a hard working person. Self made and I push to be more innovating at what I do. I am pro fairness, but not complete socialization of our society. I feel that in this day it's extremely important to keep up and be prepared and keep that hot water FLOWing~


slingshotGF#1529683/3/07; 22:43:49

One post at a time ;0)

slingshotmikal#1529693/3/07; 22:47:34

I am going to make a statement.

I do not think they can fool us for long. That is those who are stating to think twice.

mikal@slingshot, Goldfinger#1529703/3/07; 22:57:30

Yup. You're staying ahead of the game, as hard as it is.
This is a good one, short and to the point:
Banks and Bubbles IV: Sudden Junk - John Rubino - March 4, 2007

slingshotGold finger#1529713/3/07; 23:00:19

We are not distant in our points of veiw and I find most Goldbugs are within a channnel which runs from doom and gloom to eurphoric. But a more realistic veiw may be from Hands On to Virtual Reality.

slingshotHey Topaz#1529723/3/07; 23:20:01

You on the wire?

mikal@slingshot#1529733/3/07; 23:21:13

Re: "Benny and the Jets"
Benny and the Jets Hueys - Gary Tanashian - March 4, 2007 - GoldSeek

slingshotmikal#1529743/3/07; 23:26:11

Yepper they are monitoring this site ;0)
Man was that fast.

slingshotOld Italian saying#1529753/3/07; 23:42:34

Over the span that I have been at this site there has been a notable statement as to the age of our posters.
Sixty years plus? Well let me set the record straight to those WIPPER SNAPPERS.
Experience (OLD AGE) will overcome Skill and Youth.

GoldiloxGeorge on the History Channel#1529763/3/07; 23:46:03

@ Slingshot,

I did catch George's appearance on the History Channel, but found the overall show as shallow as a lot of their shows on the ancient world.

The producers didn't do their homework very well, IMHO.

George did not embarrass himself, but there was no where near enough time alloted to explain the mechanics of the web bot project. The best explanation I've heard is from the inventor, Cliff, in a series of interviews with Alex Merklinger before Alex went "dark". The archives of those interviews can be found at:

While they tried to rally around the "doomsday scenarios" in many of the surviving ancient texts, they did not mention Neil Freer or any of the other folks who are doing some very interesting work to tie those ancient civilizations together, with some plausible theories on why certain themes appear in all the surviving manuscripts.

They also went off on a segment about flipping magnetic poles, and confused it with the effects of flipping geographic poles, NOT AT ALL the same thing. Then they brought up some yahoo's premise that crossing the Galactic plane might "flip" the atomic spin of all matter and destroy it. Whoo-weee! That's as silly as the assertion that toilets must flush clockwise below the equator and counter-clockwise above it.

I have to agree with Jim McCanney. Every time social balance deviates from the "bland", the doomsday prophets all start waving the Mayan or Vedic calender at us, looking for their 15 minutes of fame, and touting some pretty massive extrapolations of what we really "know" about any ancient civilizations.

But, it keeps the masses from "paying attention to the man behind the curtain" once again, so I imagine TPTB relish the "info-tainment" in true Marshall McLuhan style.

mikal@slingshot#1529773/3/07; 23:47:07 Just pulled this off MK's newswire. It's looks to be the same story Tanashian covered below.
A noose? A puppet string? A halo? ;) LOL Good night.

slingshotmikal#1529783/4/07; 00:05:11

Picture is worth a thousand words, but preception much more.

slingshotOh! the Horror of It All#1529803/4/07; 00:37:51

In my past posts I stated I wanted to meet some of the Great Posters on this Forum. Well, I can understand the reserve not to. But, you can even ask my wife, I have the strangest ability to meet people in the most Arkward circumstances. So one day, in a crowd or resturant or what ever,a word, name will prompt me to say. Hey Are you so and so?
What a nice day that will be.

TopazHey slingy!#1529813/4/07; 00:40:49

Just got back from giving the g-daughter her first horse-riding lesson ...getting her instructed I mean, that "pirelli" (sp?) method sure is user friendly both for Horse and fledgeling rider ;-)

A while back the subject of the Price of Oil came up. We identified that, in fact there were approx 20 P's of O dependant on factors as diverse as crude quality, transport etc and the PRICE generally quoted (say Brent) was but a reflection of the overall market.
It takes some stopping and thinking about eh? ...but once you've done it, it's filed away as only mildly relevant in the scheme of things.
Mildly relevant largely because Oil is consumed as fast as it's pulled from the ground. (give or take)
The same basic process for price discovery is also applied to Gold and Silver except that a whole lot of different circumstances come into play.
SO DIFFERENT is it that it could be said that the Price of Gold is determined by, on one hand a group who doesn't possess gold supplying the ASK side of the arrangement ...and a group who doesn't want gold, coming into the market to provide the BID...
...and via this quaint little arrangement, they expect ME to value my Gold in Hand accordingly?

Ain't gonna happen at MY place ...and many thousands of other places elsewhere I'd imagine.

Tannehillslingshot (3/4/07; 00:15:07MT#1529823/4/07; 00:47:50

Nope, I don't have anything to say, just lurking by.
slingshotHello Topaz#1529833/4/07; 01:05:00

Good to hear from down under and your Grand daughters ride on a horse. Great beast they are and most intelligent.
I did have the priviledge to ride a working horse and had the most wonderful time,(terrifying) as to using the reigns and heels directing the animal. Ocala was her name and was most acute to each movement. There is nothing to discribe when man and beast act as one. Not your usual D*** A** Yankee.
Now to oil. there is nothing much more to say as the race to claim the resources that are finite Only the POG to POO.

TopazCurrencies Gold.#1529843/4/07; 01:06:51

There was a time when I used to refer to "alt-currency" Gold ...where $PoG was a genuine proxy for the "others" namely currencies on the opposite side of DX.
As can be seen in the accompanying Charts, this is no longer the case as Gold NOW represents an alternative to ALL currencies.
We can rest assured this is but a means to an end compadre's ...not an end in itself.

Giddy-up aggie next week imo.

slingshotTannehill#1529853/4/07; 01:10:42

Nice to see your out there, Chime in when you want. But there must be something that is bugging you?

TownCrierGod luv ya, Topaz! This is why yer 1 of my favorites!#1529863/4/07; 01:12:36

"the Price of Gold is determined by, on one hand a group who doesn't possess gold supplying the ASK side of the arrangement ...and a group who doesn't want gold, coming into the market to provide the BID..."

Alton Brown would readily identify that as a recipe designed to serve up deliciously cheap prices for all comers savvy enough to dine on the metal.

To borrow the words of one of our greats... "Get you some."


TownCrierTo hammer the point home#1529873/4/07; 01:19:02

Gold 'enjoys' THE most perverse price discovery mechanism know to the modern marketplace.

Veritible "Good Eats" for the intelligent diner (-- to carry forward the A.B. theme).



slingshotFixation. T.C. and Topaz#1529883/4/07; 01:20:32

Did I not center on oil and missed the whole message.

Topaz@GOLD FINGER.#1529893/4/07; 01:23:29

There are generally two types of poster GF. Those who can draw a bead from 3000yds and hit the bullseye with one shot ...then there's those who, although arguably equally adept in the end, prefer to use a 12 gauge from 25yds and blow the sucker to kingdom come.

The important thing imo is: just keep shootin 'till they don't shoot back!

slingshotTapaz 152989#1529903/4/07; 01:26:22

Thank you. I'm the shotgun type.

Topazslingy#1529913/4/07; 01:34:34

No mate, I'd just used Oil as an example where market participants are (largely) suppliers and "demanders" whereas with Gold (particularly) no such parties are in evidence ...or not nearly in the same proportions.
slingshotTopaz#1529923/4/07; 01:36:02

Can you still have a weapon in OZ?

Topazslingy.#1529933/4/07; 01:53:04

No ...or they make it real difficult, restricting you to target pistols, members of shooting clubs etc.
Of course, like all restrictions, it only applies to the honest types who willingly handed in their guns on request.

NZ doesn't have any restrictions as yet I'm told ...and there are still places in OZ where "the Law" hasn't quite caught up.

These places are like "Oases of Freedom" downunder slingy.

Posting-wise, I'm content to spray away in close too.

slingshotTopaz#1529943/4/07; 02:24:18

I am sorry to hear that your have major restrictions. I want to tell you over the years of my military service, I have no better comrade to be with than a Brit, Goofy Newfy or Aussie on Liberty. They just do not run from a fight. But on another accord you are peaceful people. I will not give up my guns. I will not give up my gold. I will not Give up my LIBERTY and there are 250 thousand gun owners in the USA that say the same. Wait till they call us TERRORIST.

slingshotGood Morning#1530023/4/07; 04:33:15

Sundeck and Cometose.

CometoseSlingshot#1530033/4/07; 05:43:08

You da man ..........
Night owling it again .......
Sorry , I was bit late getting up ........
Enjoy your rest ......

CoBra(too)Dire Warnings from a friend ...#1530043/4/07; 07:11:11

As in all good cycle work a lot of FA is builds the base. Whith the world in an ever growing debt trap - in particular the Western world Chopper Ben may be forced to upon all spigots soon. All bets for a soft landing will be off by then - for the economy, the currency system crashing under the $'s de(bt)ad weight, taking every and all financial assets, mortgages and hedge funds down along with it.

Guess you all know what to do in the next few months, but read my friend's memo carefully and stay calm, cool and collected as in time who will care if he bought his bulllion
a little on the high side when it's again the only value of importance.

"Here are my thoughts after Tuesday and Friday. We still believe that a GOLDEN opportunity awaits us at lower prices...the $450 level is theoretically doable...but watch $526 as this may be the be safe and not too smart, anything under $500 is a must buy...who cares if it drops to the worst possible level foreseen of $410. At $3,000 an ounce we will not be arguing about 50 to 90 dollars on the buy price! The important thing will be...are we there at all?

The bull market is/was 52 months old....the cycle must complete by the end of April...the next two months are going to create financial turmoil if we are to arrive at under 8000 on the Dow in the stated timeframe. May, we see distress selling and the possibility of picking up the bargains.

While we are 70% liquid...the 30% are largely...about 29% in precious metals and base metal stocks...

So dust off your buy orders and wait patiently poised like a rattlesnake ready to pounce on its prey...

I understand that at Beranke Helicopters Inc they are getting the helicopters ready for takeoff full of those pieces of green paper...however, there are so many to load that takeoff is not expected momentarily...but in a few months' time. Yes as we predicted inflationary depression...and Notley saw this in 1979 when he trained me...amazing insight!


This week has brought a big change to the markets...a very major turning point which cannot be ignored. We expected it and we have planned for it. It was no surprise to us.

As of last night, the OBVs on some stocks have turned very ugly...Yamana, Coeur d'Alène, Northern name but three
The big drop in Yamana of 19.1 million shares last evening has certainly got the alarm bells ringing. Even Kinross went into a downturn OBV wise. Remember volume always precedes price.

It is for this reason that I have had certain misgivings about Granville's buy signal of 4 January...we did respect it and moved some funds back to the market but not anywhere near our commitment in May 2005 or November 2000 when we were virtually 100% long in the precious metals and commodity sectors.

Here Ian Notley's work provided invaluable insight into where we were on the extension...always higher be followed by the D phase of the cycle...which can be a nasty down or a painful patience testing sideways movement...

But I have these several Niagara Falls type OBV charts to look at where several huge down days are causing me to ponder long and hard...that just maybe our price objectives on the downside will be achieved setting up the fabulous buying opportunity which many will miss because of the fear factor which will prevail at the moment of opportunity. Take note from our Chinese friends...CRISIS is made up of two symbols..."fear" and "opportunity" in their sign language...sage thinking!

A clear mind, independent and aloof from the daily noise wlll be important together with Notley's charts and continued input from Granville and Prechter.

There is a certain amount of divergent opinion at the moment among the three...Granville being bullish on the gold stocks, Notley and Prechter being somewhat more cautious and looking for some downside action here.

This is now where the sheep and the goats will separate...

We need wisdom, discernment and courage over the next few weeks (months) to ascertain the moment to is conceivable we first have a few days of rebound and then another thumping. The months of March and April look particularly difficult and probably we may see some extreme turbulence in both directions as the war between the bulls and the bears moves up to a final major pitched battle. The outcome we believe to be a Dow en route to below 11,000 and then below 8, the bears will win.

However with Tuesday's breakdown now in place and yesterday showing further weakness, will there be a rebound? Again 1929 is useful history material...we first had the Dow break from 384 to 290, the rebound to 340 before the grand smash to 190...followed by a 6 month recovery to April 1930 and after that it was curtains for 95% of the market EXCEPT the gold and silver stocks.

So there is the picture at the moment...a real challenge to those of us who try and do our homework and dismiss the trivial excuses of the media who offer China as the reason for this meltdown...that is a woeful and painful and trite explanation to find a scapegoat for serious problems at the very heart of the financial system particularly in the USA.

Here liquidity and freedom from debt are going to be vital to the financial survival of many people as finally the hedge fund and mutual fund mentality meets the real world.

Long term we firmly believe and have not changed our stance...commodity based (particularly gold and silver) investments will be a great place to be. Canada promises to have a great future for the next five years...but first we have to cross this hurdle. For those who have read my recommended reading list then the near future will cause you no difficulty since you have read and studied for this precipitous moment in financial history. If you have not already read Prechter's "Conquer the crash" (published 2002) this would be a good time to take crash course in its contents"!


slingshotComet ose#1530053/4/07; 07:48:01

What a nice term. Now to finish the hot water heater. Night Owling ;0)

Rook.,.#1530063/4/07; 08:40:40

During the last 2 weeks, I have begun to change my -walk on the sunny side of the street- view of what possible end games the big boys have in mind.
To save you link time, one of the end games of the big boys is to have the US as the only nuke power. This link provides info on the actual state of china/russia nuke deterrent. Thier nuke forces would not survive a US limited first strike.
The game that really changed America from gold to fiat, and the founding of the fed, is being steered by 2 factors from the view of those boys, thier preplanned actions, and the -murphys law- that interrupts them, temporarily.

TucoThank You#1530073/4/07; 11:23:25

The Danish 20 Kroner coin arrived. It is beautiful! MK, Gandalf, thank you for hosting the contest and offering such a wonderful prize.
USAGOLD / Centennial Precious Metals, Inc.A prize mermaid that's found a good home. Congratulations, again, Tuco.#1530083/4/07; 13:23:57">gold Mermaid contest prize
mikal@Rook#1530093/4/07; 13:46:01

Thank you, I cannot elaborate on the Council on Foreign Relations position paper you linked.
Aside from the happy economy of words, a mere summary statement can be seen to be both salutary to the prevailing tone of the gold forum and most effective in rebuttal.
Neocon warmongering and isolationism in service of the military/security/industrial complex and it's affiliated illegal arms, drug and slave trade, cannot substitute for actual progress and enlightened governance in support of continuing the life of the universe and incraesing the good life of all lives.

mikal(No Subject)#1530113/4/07; 14:48:50

International Forecaster March 2007 (#1) - Gold, Silver, Economy + More

By: Bob Chapman, The International Forecast - Posted Sunday, 4 March 2007 |


The nation's manufacturing sector, or what is left of it, slipped into recession over the past year, but our media, Wall Street, our government and corporate America somehow didn't notice it. Now we are told, after multiple revisions, that GDP growth in the third quarter of 2006 was 3% and in the fourth quarter 2.2%. The later only two weeks ago was revised from 2.6%, up to 3.5%. Obviously the government is either hopelessly incompetent or was lying. We defer to the latter. Our Commerce Department tells us orders for durable goods, like computers, vehicles, aircraft and factory machines, plunged almost 8%.

These factors add fuel to the fire as markets in Europe and Japan fell as the Chinese stock market plummeted some 10%. US markets fell 3 to 4 percent, the worst fall since 2003. This is significant because with all their funds the "Working Group on Financial Markets" could not arrest the downward tidal wave even with the help of the Fed, although they found time and money to again viciously attack gold and silver. Of course, the market problems were the result of a computer glitch and if you believe that we have a bridge for sale you should take a look at.

We are in a recession, a real recession and not only manufacturing is telling us that, but so are the credit and housing markets. We have been in recession for a year and few professionals and investors know it yet. Can they be that dumb? We do not think so. They are in denial. They do not want their money feast to end.

Bad numbers have been coming for six months, but with market manipulation the players figured the elitists could keep the game going indefinitely. Even though manufacturing is only 12-14% of GDP, if it is in recession it is problematic for the entire economy. We also have high home inventories and foreclosures and a housing slump. We see GDP falling three quarters in a row, which sets a trend, a downward trend. The Street is again betting that there is a 52% chance of an interest rate cut. Maybe, that is if the Fed wants the dollar to collapse. Foreigners are not going to roll Treasuries and agencies if US yields fall as other rates are rising in England, Europe and in other countries.

The housing problems are approaching a crisis that will play itself out over the next 2-1/2 years as we predicted so long ago. The economy is facing major risks and most people are oblivious to them or in denial. This is human nature and it is natural, but it does nothing to make the problem go away.

The cartel in spite of their recent success in knocking gold and silver lower again is losing power. Their behavior is blatant and that of someone disparate. The US Treasury is trying to control the unwinding and sale of US dollar positions and at the same time orchestrating a flight into Treasuries. This is bullish, especially when they have to use the access market to try to control gold. In their arrogance they want you to know they are screwing you and the world investing public. This is not the central banks of other countries, this is the go it alone now US Treasury and our Fed. This is not control – it is illusion of control by delusional people. This is their final act. We are about to become another Zimbabwe, so get ready for real hyperinflation as the Illuminati tries to keep the game going."

flow5The Elliott Wave Theorist#1530123/4/07; 17:40:59

I have no faith in someone that can't even get their 800 number right.
flow5Inflation: A Monetary Phenomenon#1530133/4/07; 18:09:32

With the exception of hyperinflation, all the "flations" are the consequence of "too much money chasing too few goods and services", or the opposite. Inflation represents a chronic "across-the-board" increase in prices, or, looking at the other side of the coin, depreciation in money. If the depreciation of money is the consequence of a loss of confidence in the credit worthiness of the government, we have hyperinflation. The ultimate hyperinflations result when the existing government is destroyed, making its currency worthless - a 100 percent depreciation. There are, of course, degrees of hyperinflation.

It is a truism that if the flow of money in the market place increases relative to the flow of goods and services offered for sale, prices on the average will rise. Therefore, to say that a cartel or monopoly that posts a higher administered price causes inflation has to be premised on the assumption that the monetary authorities respond to such price fixing practices by increasing the volume of money and/or the public responds by increasing the rate of flow (transactions velocity) of money. The same reasoning applies to increases in wages achieved through the monopoly powers of a union. These price increases will result in a transfer of purchasing power and wealth to the groups with dominant economic powers. The resulting price distortions will weaken and depress the economy, increasing unemployment and ultimately creating a deflationary effect.

If the response of the monetary authorities is to provide additional legal reserves to the banking system, resulting in an expansion of bank credit and the money supply, other prices will rise and the monopolistically created prices will be "validated". This obviously may lead to an administered price ---credit money spiral, and we have the core of chronic inflation. If the monetary authorities try to compromise the situation and reduce the rate of inflation, we end up with stagflation. But this is preferable to an all out monetary effort to create full employment irrespective of the inflationary effects. For if the rates of inflation increase, so will interest rates; and high interest rates alone are a sufficient factor to induce a severe recession or even a depression.

In other words, the powers of the Fed are limited. The solution to this problem is to eliminate, or sharply reduce the economic powers of monopolies, oligopolies and any other form of concentration of economic power. How to do this without the creation of an authoritarian state has yet to be discovered.

Black BladeWE ARE IN CRASH MODE#1530143/4/07; 18:44:36

The Nikkei is in free fall at the open, the Aussie and Kiwi markets are following and the Hang Seng is expected to crumble at the open. Looks grim outta the gate.

Gold and Silver "portfolio insurance" is looking good about now even after the hedgies sell off last week to scrounge up cash to cover huge losses in the equities and mortgage securities markets.

As always, get outta debt and stay outta debt, stash enough emergency cash for several months' expenses, accumulate Gold and Silver "portfolio insurance", and start a storage program of nonperishable food and basic necessities.

- Black Blade

CometoseFlow 5 Elliot Wave Theorist doubter#1530153/4/07; 18:58:07

His predictions haven't been right either

He didn't make any money on his hunches that were in book form ......

only made money on his books ...........

Probably not an authority that one should take at his word ,because he didn't get results based on his VERBAL AFFIRMATIONS..

His talk in his books is the only medium through which he can make up for losses he sustained on his MISCALLS

ArcticfoxAnyone here follow Armstrong's work..This was written in 1999#1530173/4/07; 19:41:43

but look at 2007.15 on the graph...
jiHuman effort#1530183/4/07; 19:45:09

The volume or velocity of money doesn't matter. What matters is that the human effort to produce whatever is used as money is equal to the value of the human effort it is traded for.
Black BladeLooking Grim Tonight#1530193/4/07; 19:46:07

U.S. market index futures are down sharply (especially compared to "fair value"). At the current levels we are looking at a continuance of a tumbling market. We might be looking at "Black Monday" unless "The President's Working Group on Financial Markets" can step in overnight and flood some liquidity into the markets. Right now it looks rather grim.

- Black Blade

GOLD FINGERI do believe.....#1530203/4/07; 19:55:21


Have a glorious tomorrow!


flow5Crash Mode#1530213/4/07; 20:01:47

The history of pegged exchange rates, is that eventually, they collapse. Far East countries, which are export dependent, must at some juncture, reverse their foreign exchange positions.

For the U.S., imported oil, combined with unilateral transfers of funds by the Federal government to foreigners, ensure perpetual mammoth trade deficits, and an inexorable decline in the exchange value of the dollar.

Inevitably, the declining exchange value of the dollar vis-'vis the major currencies, will increase the number of depreciating, unwanted U.S. dollars, and magnify our trade deficits. Ultimately, there will be fewer dollars to recycle globally (fewer imports), higher interest rates, and higher prices.

contrarianArmstrong's Call#1530223/4/07; 20:06:40

Articfox--yes, I follow Armstrong's work, and posted here a few days ago the info about the amazing call he made for a turning point on 2007.15, which came to Feb 27, the day the Dow crashed 400 points. I think his work is brilliant and should be followed. My posting elicited no comment at the time, perhaps because this isn't a stock site, but actually the cycle can be useful for perusers of this site. It can be used as a guidepost for entering and exiting precious metals, as Urban Survival once posited, I believe--this global business cycle. It would be a contrary play.
flow5Armstrong#1530233/4/07; 20:16:35

Holy toledo! What kind of drugs are these guys on?
Black BladeU.S. Heading For Financial Trouble?#1530243/4/07; 20:23:31


CBS) When the stock market plunges like it did this week, everyone pays attention. The man you're about to meet says hardly anyone is paying attention to what really threatens our financial future. Like an Old Testament prophet, David Walker has been traveling the country, urging people to "wake up before it's too late."

But David Walker is no wild-eyed zealot. As Steve Kroft reports, David Walker is an accountant, the nation's top accountant to be exact, the comptroller general of the United States. He has totaled up our government's income, liabilities, and future obligations and concluded the numbers simply don't add up. And he's not alone. Its been called the "dirty little secret everyone in Washington knows" – a set of financial truths so inconvenient that most elected officials don't even want to talk about them, which is exactly why David Walker does.

Black Blade: Too bad this article is narrowly focussed. I would like him or the Treasury Sec. to discuss our national debt that now is in excess of $56 Trillion (on and off budget items). The last Treasury Sec. to spill the beans was Paul O'Neill, and he only did that to get back at the insiders who got him fired.

Silver FoxMacro Issues#1530253/4/07; 20:49:33

Well boys, hold on to your hats. We all know that the economic floor is made of wood, and it isinfested with termites. Now, the question becomes, does the s--t hit the fan this month, or as some well informed pundits believe, we only have a minor dip, and watch the dive in 6 to 8 months in the future...

One thing for sure, March is going to be an interesting month.

(Damn, this is so much better than any action packed adventure!!!)

Hope you are holding gold & silver.

Good luck & good fortune.


Black Blade"I See Red People"#1530263/4/07; 21:08:16

Black Blade: Looks especially grim in Asian trade. "Red" across the board.
GOLD FINGERHow about a little stock guessing contest?#1530273/4/07; 21:18:59

Hello Gold Bugs.....

How many points will the DOW loose tomorrow after it closes?

100 points?

200 points?

300 points?

Over 400 points?

I guess over 400 points!!

What's the prize you maybe wondering??




GoldiloxNikkei now down 3% - 500 points#1530283/4/07; 22:47:57


"If New York continues to slide and the yen continues to strengthen at this pace, there is no bottom in sight for Japan," said Kirby Daley, a strategist at brokerage Fimat.


"Falling, yes I am falling,

And she keeps calling . . . me back again."

The web bot report for the week came out today, and it is BLEAK!

melda laureThe special leprechaun buying season hath arrived.#1530293/4/07; 23:04:08

An' they'll be a grabbin' anythin that gets jostled out o your nasty little pocketses.

Hmm... the flations? Well I suppose... yet when things get bumpy it often seems to me that the money becomes more reactive than resistive, and reactances can be negative... that is to say they often behave in non-newtonian fashion. Best to carry the battle to the enemy, with lots o green.

Fill the pot.

Sierra MadreThat chart last Autumn..#1530303/4/07; 23:07:22

Remember that chart back about October 2006, showing how the stock market follows so closely the housing market, with a 12 month lag?

Maybe that lag is finally making itself felt.

Does anyone have that chart? Would be interesting to take a look at it now.


Sierra MadreNIKKEI -#1530313/4/07; 23:09:24

Nikkei now down 3.7%

Aiyee! Panic!


GoldiloxNikkei tumble joined by Hang Seng and Shanghai Composite Index#1530323/4/07; 23:28:38


SHANGHAI, March 5 (Reuters) - Chinese shares fell 3.5 percent by early afternoon trade on Monday, led by blue chips, as the market was hit by weakness on global markets and a cautious mood during the country's annual parliament session.

The Shanghai Composite Index was down 3.5 percent at 2,732.423 at 0526 GMT. Turnover in Shanghai A shares was a heavy 51.8 billion yuan ($6.7 billion) by midday.

Shanghai's fall was in line with a 3 percent drop in the Hong Kong benchmark index.

"The market was affected by weak global markets, including falls in Hong kong and Japan today," said analyst Yang Weicong at United Securities. "Also, the NPC session is a sensitive period as it brings many kinds of news -- both good and bad."

This year's meeting of the National People's Congress (NPC), China's parliament, kicked off on Monday.

Investors continued to sell financial stocks, which led a plunge in stocks last week.

GoldiloxTABLE-HK short selling turnover HK$2.01 bln by lunch#1530333/4/07; 23:32:11


HONG KONG, March 5 (Reuters) - Short selling transactions
amounted to HK$2.01 billion by midsession on Monday, compared
with HK$1.26 billion at the same time on Friday, the Stock
Exchange of Hong Kong said.

A total of 181.08 million shares of 162 companies were sold


The caca is being "spread".

GoldiloxThe Pound Sterling#1530343/4/07; 23:39:17

The pound, which was threatening a 2:1 $ ratio not long ago, is also not fairing well.

It's back down under 1,93.

Black BladeNikkei books biggest loss in 9 months#1530353/4/07; 23:41:32

The sell off is accelerating. When the Mikkei closes for mid-session it should be interesting to see what the reaction is in the second daily trading session. So far it appears that a pervasive weakness exists in the Asian markets. The European markets appear set to open sharply lower and the US market futures are sharply off indicating a possible sharp drop in the opening minutes of trade on Wall Street.

- Black Blade

Liberty HeadA Clue#1530363/4/07; 23:44:18

While global stock markets are in general decline, WEYERHAEUSER stock was going up.
Looks like somebody is expecting a higher demand for paper products. Ah ha ha ha ha ha ha ha ha ha ha ha

Best Wishes

Black Blade"Black Monday"#1530373/4/07; 23:47:21

Black Blade: The Nikkei was down 624 points at 1 a.m. & the Dow Jones futures slipped to minus 114. The world is definitely coming to an end. Looking even worse now.

In a word - "Grim"

GoldiloxMore to come?#1530383/5/07; 00:32:51

CBS MarketWatch:

Hong Kong's Hang Seng Index was down 2.9% at 18,882.74. The Hang Seng China Enterprises Index, a gauge of Hong Kong-listed shares of mainland companies, tumbled 5.7% at 8,475.36.

China's Shanghai Composite Index reversed early gains to trade 3% lower at 2,744.71.

"I'm not upbeat about the market direction," said Alex Tang, head of research at Core Pacific-Yamaichi in Hong Kong. "The global markets have been moving higher over the past year without any pause, so we are now paying for it."

Tang said the Hang Seng Index could decline another 500 to 1,000 points in the short term, but is likely to trend lower until reaching the 17,000 level around mid-year.

"We advise clients to offload shares on any rebound, the market is moving lower," Tang said.

GoldiloxAre we being robbed by the banks?#1530393/5/07; 00:42:51


In recent weeks, UK High Street banks have been announcing record profits. Are these figures to be criticised or welcomed?
Two commentators from opposite sides of the argument go head-to-head over the issue.


Nothing new in this debate, but the fact that it headlines the BBC Business section speaks volumes.

GoldiloxLloyds hangs up on Indian calls#1530403/5/07; 00:50:44


Lloyds TSB, the UK's fifth biggest bank, has said it is closing its call centre in Mumbai - but that back office work will still be outsourced to India.
Customer phone calls will now be answered in its 10 UK call centres and the numbers of branches made available.

Lloyds TSB said that calls had previously only been directed to Mumbai when its UK operators were busy.

It added an automated call-handling system had cut the number of callers who needed to speak to an operator.

This meant there was no need to continue to answer calls in its Indian call centre, which at its peak employed 600 people but now employs about 180 people.

The bank employs around 2,800 people in India, and staff at the call centre will be given new roles.

Lloyds TSB Group Union, which represents many staff at the bank, welcomed the move saying that outsourcing calls to India had proved "a costly failure".


Unhappiness with international "assistance calls" is not limited to the high-tech world. Globalism is losing some of its "charm".

ge@ Sierra Madre#1530413/5/07; 02:10:20

That chart last Autumn...
PaddingtonYen Carry Trade, Total Recoil ?#1530423/5/07; 02:28:30

Looking at the yen strengthen vs the us dollar there are the occasional sudden +/- 0.50 yen surges but nothing really to indicate capitulation at this stage.

I don't know how long this carry trade has been going on (years ?) or how big it is, but the FX graph seems to indicate the current unwinding as moderately orderly.

One presumes that so much money has been made with this speculation over the years that even the move from 121.50 to 115.50 in 6 trading days is not worrying too many.

As more funds liquidate however the yen is forced upwards further squeezing the margins of those still onboard creating a potential capitulation scenario further down the track.

Perhaps the occasional sudden +/- 1.00 yen surge going forward will be evidence of the snow ball effect moving closer to capitulation.

Sundeck@Sierra Madre #153030 Correlation SP500 and NAHB Housing Index#1530433/5/07; 03:26:27


I think this may be the chart to which you refer (see link).

The S&P500 index currently sits at about the same level as it did back in November last year when this correlation was reported (by Sir Thoreauly, I think). But the S&P index is certainly headed in a direction that suggests that the correlation may be sustained a bit longer.

One must be cautious not to read too much into these charts...correlations do not necessarily imply hard and fast causal linkages.



USAGOLD / Centennial Precious Metals, Inc.FREE Gold Information Packet...#1530443/5/07; 03:40:34">FREE Info Packet
flow5Paul van Eeden -- China#1530453/5/07; 08:12:29

On Tuesday for the first time in modern history China became a world financial trendsetter. The Chinese stock markets declined (the Shanghai Composite Index fell 8.84% and the Shenzhen Composite Index fell 8.54%) and stock markets around the world fell like dominos.

That China is important to the world's economies and financial well-being should not have caught anyone by surprise. China has been credited, or accused, depending on your point of view, with the increase in commodity prices for several years now and the ascent of its vast population to middle class is supposedly going to convert hundreds of millions of investors all over the world into millionaires. So when China's stock markets fell, the world took notice.

The reason for the markets' fall was China's government's announcement the previous day of a top-level task force to clamp down on illegal activities in the securities markets. Chinese investors have been flocking to stocks hoping to get rich, just as North American and European investors have been snapping up anything to do with China hoping not to get left behind. Chinese capitalism is today's Wild Wild West where just about anything can and will happen, where for every greedy investor there is an appropriately constructed plan to part him from his money and now the government wants to put an end to it.

The Chinese banking system is rife with bad loans made to well-connected people who set up unprofitable businesses. Corporations borrowed money to build factories, offices and apartments, many of which are empty or operating at a loss. The boom in China's stock markets was, to some extent, also driven by debt, although I suspect it would be near impossible to figure out just how much of the speculation had been undertaken with borrowed money. When markets are debt-driven they are massively volatile both during the upswing, as an inordinate amount of money chases limited stocks, and during the down-cycle, as investors panic and fret about losing all they have and more, so it is not really surprising that China's stock markets took a plunge.

The only explanation for the contagion caused by China this week is that investors across the globe have entrusted their money to mutual fund and hedge fund managers that are gambling on the greater fool theory with their clients' capital. When the markets around the world fell in sympathy with China it illustrated loud and clear that many investors have no interest or faith in the companies they own; they are merely holding them in the hope of trading the stocks to another fool in the future.

According to the World Bank approximately one third of all of China's production is exported, and if you consider the flow through effect then perhaps more than half of China's economy is export dependent. As a bellwether, the USA being the world's largest economy and largest consumer is therefore far more indicative.

Unfortunately the United States is not in good shape. The latest from the Commerce Department is that durable goods orders fell 7.8% in January; the National Association of Realtors reported that January new home sales were down 4.3% from last year and the median sales price was down 3.1%; the Commerce Department revised gross domestic production for the last quarter of 2006 down to 2.2% from an earlier estimate of 3.5%; business spending fell 2.4% in the last quarter although consumers did their part by increasing their spending by 4.2% yet residential fixed investment fell 19.1%.

Consumer spending accounts for more than 75% of US economic activity and the US accounts for more than a third of all the economic activity in the world. The US consumer accounts for about 25% to 30% of global economic activity, meaning that if US consumer spending fell by only 5% there would be a 1.25% to 1.5% reduction in world-wide economic activity. There is no other single more important economic factor than the US consumer. Because the US consumer has been financing his spending with borrowed money generated mostly due to rising real estate values, we should look at the US real estate market for future guidance - not to the Chinese stock market.

Nathan BrazilGold stocks in the end game#1530463/5/07; 08:12:59

The ultimate hyperinflations result when the existing government is destroyed, making its currency worthless - a 100 percent depreciation.

In the extreme, gold metal in hand has value for barter.

Does history speak to the fate of stocks that represent gold mines or metal during hyperinflation? Will companies survive the singularity and come out the other side re-valued in other currencies? I can find no precedent.

On another note, it is amazing how quiet this forum gets when we are taking a bath. If you came here for sage advice on timing this market you have my sympathy. If you are doing it with leverage, you have my condolences, I know that margin call really hurt.

For those of us with physical for cash this is an annoyance at worst or a huge opportunity if still liquid. Careful you aren't dashed on the rocks by the breakers while waiting for the tide.

flow5China - continued#1530473/5/07; 08:14:23

Existing home sales fell 8.4% in 2006, the sharpest decline in home sales in 24 years. 30-year mortgage rates are still only at 6.14%, and so homes should be very affordable, but because of rising real estate values home buyers are battling to meet mortgage payments. Falling real estate prices have reduced some home values below their outstanding mortgages, making the homeowners prone to default on their mortgage payments. Nearly 6% of all sub-prime home loans were more than two months in arrears by the end of last year and first-year delinquency rates are up about 200% in little over two years.
Approximately 16% of all mortgages issued last year were to sub-prime borrowers and with falling real estate prices the money available to these borrowers is drying up. That will reduce demand for homes.
There is an index (part of the ABX family of indices) that tracks how much it costs to insure BBB-minus rated bonds backed by mortgages to sub-prime borrowers. When the index falls it means such mortgages cost more to insure, which in turn is a proxy for the risk and value of these mortgages (as risk increases, insurance increases and value decreases). The index is down almost 30% since the beginning of the year. More than 20 sub-prime lenders have closed shop after having to repurchase bad loans they originated.
Mortgage defaults are now the highest in five years and rising with many of the problems tracing back to adjustable rate mortgages - what a surprise! Mortgage lenders such as Bank of America and Citigroup are now trying to get borrowers with adjustable rate mortgage to switch to fixed rate mortgages. That's a smart move for both parties: the US budget deficit will eventually cause interest rates to rise to much higher levels. Some banks are now also allowing borrowers to sell their homes for less than the outstanding mortgage and then forgive the shortfall since it is often less costly and time consuming than foreclosing on the homes. The catch is that borrowers may find they have to pay income tax on the forgiven debt. Sales of homes for less than their outstanding mortgage debt increased by 25% during 2006 according to Bank of America.
Keep in mind that the increase in bad loans is broad based and is occurring during exceptionally strong economic conditions, at least if you believe the authorities and talking heads. US consumer confidence is still at a five year high indicating that the collapse of the US real estate market has not had a major effect on consumer spending yet. What is going to happen when consumer confidence finally does fade and economic growth does stall?
As more and more home owners get into financial trouble and more and more homes go on sale it puts downward pressure on house prices. Home prices fell in about half of all metropolitan areas during the fourth quarter of 2006. For the first time since the National Association of Realtors started recording home prices in 1979 home prices fell in the majority of the cities surveyed.
Home construction has fallen to its lowest level in ten years. Housing starts in January fell 14.3% and building permits fell 2.8%. Luxury home builder, Toll Brothers, reported a 67% decline in its last quarter's profit as it wrote down inventory. The company also lowered its earnings outlook for 2007 based on fewer orders and rising cancellations. The company's net orders are down 33% from a year earlier as it struggles with a 30% cancellation rate.
It's not just real estate loans that are going sour. Wells Fargo, the 4th largest bank in the US by market value, reported $726 million in net credit losses for the fourth quarter and most of these were concentrated in its auto-lending portfolio. Consumers are increasingly unable to pay for all those new cars they bought when the car companies were running specials to get rid of inventory. US Bancorp, the 6th largest bank, saw a 25% increase in charge-offs and predicted that writing off retail loans will continue to increase during 2007. These are by no means the only banks seeing an increase in loan defaults, merely an example of what is happening.
The problems don't end with autos and homes either - the economy is integrated. Home Depot expects earnings during 2007 to fall between 4% and 9% as it doesn't expect the residential and housing markets to improve during the year. Manufacturing output fell 0.7% in January with manufacturing capacity utilization at only 79.6%. Manufacturing of automobiles fell 6% in January and excluding autos, industrial production was still down 0.2% for the month.
Is this all not more worrisome than the pullback of an over-bought Chinese stock market?
The dollar lost about 2.5% against the yen during the week. I wrote about the yen carry trade and how, when it unwinds, it will cause the dollar to fall. Last month Japan raised its overnight interest rate from 0.25% to 0.5% and this is potentially far more significant than what happened in China this week. Higher Japanese interest rates will cause the yen to appreciate on foreign exchange markets and will put pressure on the yen carry trade. On Tuesday of this week the dollar recorded its largest decline versus the yen in over a year as investors sold dollars to buy yen.
It is somewhat incorrect to say that the dollar is falling since it is actually the yen that is rising. The dollar has been reasonably steady against most major currencies this week but the yen rose against almost all of them. I suspect that over time the yen will rise against most currencies and the dollar will fall against most currencies because much of the yen carry trade involves being long dollars and the US still has an enormous trade deficit that has to be addressed.
From my perspective as an investor primarily interested in gold, the events of the week were very interesting because the gold price in US dollars fell even though the dollar was down sharply against the yen.
Unlike the investors who panicked and sold this week, I was happy to see falling gold stocks. Share certificates are certificates of fractional ownership in a business and I only buy stocks of companies that I really want to own, so I don't mind if the share prices fall because it means that I can increase my ownership at a lower cost than before the decline. When I look at my portfolio and see a stock that I would not like to see fall in price I sell it immediately, before it has a chance to decline.
With gold and gold shares falling I am quite content to wait and see what happens. Nobody can predict the future so to sit and debate whether this is going to be a big decline, a long decline, a short decline, a non-event, is pointless. The markets are so emotionally driven and far removed from any sense of value that there is no telling what will happen or how long it will take. Fortunately, if the carnage is short lived then stock prices will soon recover and everyone will be happy. If the declines continue then we will find much better buying opportunities going forward and I'll be very happy.
At some point I think the US dollar is going to come under serious pressure and when that happens the dollar and the gold price will decouple, with the gold price rising and the dollar falling. I am actually hoping that the gold price continues to fall in the interim as it only means there will be more money to be made in the longer term.

flow5Nathan Brazil - Gold Stocks in the End Game#1530483/5/07; 08:23:26

Good points. That would also ascertain its value during, say, revolution, war, etc.
Paper AvalancheCNBC Going All Out to Slam Gold#1530493/5/07; 09:00:21

Watching Liz Clayman discuss a CNBC Alert entitled "Gold Losing 'Safe' Status."

This is over the top propaganda even for CNBC (and that's saying a lot).

They said that $700 gold is now out of the question. I guess that there is no need to worry with gold anymore. Time to take my ball and go home.


Cometosebleeding#1530503/5/07; 09:02:28

looks like it is going into abatement
flow5Gold Will Shine!#1530513/5/07; 09:05:06

Imported oil, + U.S. foreign & domestic military policies will rapidly transform this country into one with the highest poverty rate in the world. The exchange value of the dollar will perpetually, inexorably, relentlessly, depreciate, to where the U.S. will have no foreign policy choices.

Besides, the world consumes 4,000 tons of gold per year, but mine production is 2,500.

mikal@PA#1530523/5/07; 09:20:05

They're so desperate for tv ad revenue, they're using sensationalism on top of infomercials.
But this isn't the first time they(or their guests) flipflopped either, and it won't be there last.
Good catch Paper Avalanche. We likes to see contrarian newses, we do! ;)

mikal@Cometose#1530533/5/07; 09:23:59

Yes, now we can cover our shorts whilst everyone thinks we're permabears. I'll meet you at the Hilton for dinner and cocktails at 2PM.
MineroNever Underestimate the PPT and PTB#1530543/5/07; 09:31:15

Our friends were up all night preparing their strategies and getting ready for market manipulation. They have gone to work placing long orders and avoiding a market crash. How many more times can they extract the rabbit from the hat? They really are good at what they do! One can breathe easier for the rest of the day.
mikal@Minero#1530553/5/07; 09:38:32

Re: "One can breathe easier the rest of the day"
Tell that to the guy breathing down Hank Paulson's neck- the poor man has fled to Asia.
Re: "PPT and the PTB". I won't breathe a word of it to anyone, I promise. ;)

LacklusterPaulson fleeing...#1530563/5/07; 09:50:53

Did he get arrested again?
Sierra MadreThank you GE and SUNDECK!#1530573/5/07; 09:52:06

Thank you to both, for the chart - SnP vs. HOUSING lagged one year.

SnP still fat and happy, no problema!


GoldiloxLiz Clayman#1530583/5/07; 09:59:54

@ PA,

Watching Liz Clayman discuss a CNBC Alert entitled "Gold Losing 'Safe' Status."

So Lizzie has graduated from being the on-screen cupcake to actually "analyzing" stories? I guess it helps to be married to the producer.

Contrary indicator?

SurvivorCNBC#1530593/5/07; 10:17:55

But did you see Peter Schiff on with Mark Haynes again this morning? Did you see Haynes' face when Peter explained to the audience that the DOW has not been anywhere close to the 2000 peak when inflation is taken into account?

Schiff was on a roll today. His comments more than offset anything Clayman could bring to the table.

Meanwhile, what's up with spot gold and equity indexes tracking each other this morning? Too strange! There may well be a price conspiracy with respect to gold, but that doesn't explain everything we have seen in the last week or so.

- Survivor

Paper Avalanche@ Survivor#1530603/5/07; 10:24:28

Schiff crushed Mark Haines as he normally does. I find it remarkable that CNBC still has him on as a regular guest. You would think that they would rather have someone who is less convincing, articulate, fact based and certain of the inevitable so as not to upset the end goal of the infomercial.

I believe that you are correct that Schiff's piece more than offset the tripe about gold that followed.


SurvivorOops . . .#1530613/5/07; 10:32:25

I mixed up Mark Haines with Haynes auto repair manuals. Oh well, I guess one bunch of nuts and broken parts is about the same as the next. :)

- Survivor

MKGoldilox and all. . . .#1530633/5/07; 10:47:33

It seems to me that people are reading a lot more into what is really just run of the mill corrections in both stocks and bonds than they need to. The dynamics here haven't really changed except for one aspect -- the volatility in most of the markets. And by volatility I mean the yo-yo effect that you see on the charts. I see it only increasing going forward due to the concentration of too much capital into too few hands - a circumstance we discussed on these pages long before it became CNBC fashionable. Combine the volatility, financial engineering (huge structured derivatives' plays of all sorts including now property derivatives on the way) and with dollar woes, the markets are now inherently unstable by their very definition. (Note Sec Paulsen's description of markets over the weekend as being "volatile" by nature.)

Physical gold, through all of this, comes out a winner because sooner or later the investing public will turn to it out of frustration with standard markets.

First, its primary function in the portfolio remains a representation of stability, liquidity and enduring value in an increasingly uncertain and hostile market environment. No one, not even CNBC, can that away from gold though its opponents will take even the scantest opportunity to club it. That hasn't changed.

Second, even the correction we just went through adds up to an insignificant blip on the long term charts (this was the heart of Jonathan's analysis a couple of months ago) and there are those (like myself) who would view this it as a healthy sign for the future. Therefore, the growing ranks of gold owners is not likely to shrink noticeably anytime soon, no matter how much anti gold propaganda CNBC telecasts on a daily basis. (No one believes them anymore.)

The people who will get hurt in this are the speculators and leverage players who are going to find themselves subjected to much whipsawing in the future as the overall market volatility gains velocity -- to what end I don't think any of us really know at this time. If you don't have the capital to play a position, then stay away from it. Going forward, leverage will not be the way to riches, but to decreased wealth. One is reminded of the example of the Nightmare German inflation and what happened to speculators then. Don't forget after all was said and all their winnings counted (assuming there were any), even the adept 1920s German investor still ended up with an eroding, valueless currency.

For peace of mind and restful nights, stick with the physical, my fellow goldmeisters.

GoldiloxMore "street" interest#1530643/5/07; 10:53:34

@ MK, all -

In addition to my Sculptor friend last week, I had a house painter and a retired mover asking me specifically about gold on Saturday. I think the shift in public thinking is beginning, although you are probably in the cat seat for analyzing that based on your "new accounts".

Interesting to me is that these are "savings" types, not the investment crowd.

CoBra(too)Tell a full room ...#1530653/5/07; 10:56:57

... of people some bad news and immediately 80% of the gathering will dismiss you and not like what you say.
If you happen to be right, the other 20% will loathe you...

What a great truism - and then you just have to wait for the things to fall in place, the dust settles and pick up what's real in the mad scramble for liquidity to rescue whatever's left or underwater in your financial assets.

This time it's different is starting to get a little long in the tooth; Though it really is, at least in comparison to 1929, where people could still survive - barely - and the US was still a creditor nation. Well, yes today it's really different in every aspect.

In this context I've posted a note from a friend the other day and with the lack of response, I assume my contention is totally, if not politically correct.

That's it for now - cb2

PS: Cheers, Lady Waverider - J.Turk is a personal friend and his chart is as beautiful as MK's and I stronly believe the outcome will be even stratopheric. Just be careful in the next few month's but get all your reserve resources ready to employ once we hit way lower lows for the move - and then get ready for the ride of a lifetime. My opinion only!

CoBra(too)@MK#1530663/5/07; 11:07:08

Sorry, haven't seen your input.

So just a thought; This correction may be more severe than any we've witnessed in decades, what with the hedge funds scrambling to survive in this beginning nosedive, which IMHO is long from over.

Gold will ultimately be seen as real security instead of US and other bonds - as it seems a lot of scared investors are still running to a totally doomed safe haven. That'll change as the scramble for liquidity pauses to re-evaluate the situation and then they come to the only conclusion left ... Got'ta Have GOLD!

Best to youse and I'll back off again ... Just thought to give a li'l warning as BB has done as well - cb2

MKGoldi - Savings not investment#1530673/5/07; 11:09:34

That's been the case ever since I can remember. People with a little wealth see gold as a form of savings that's not the dollar (or euro, or yen, etc). When I decided to make the theme of the first ABCs of Gold Investing "asset preservation," it was not a creative assumption on my part, or an attempt to convert people to that way of thinking. It's what our clients had been telling us for many years. So in a sense our clientele created the theme of the book.
MKCB#1530683/5/07; 11:14:09

In terms of the DJIA I agree with you. When you think about, we haven't seen a real correction in the Dow in many years. In fact, there is a case that can be made that this last upswing was really a bear market correction for stocks. I think the correction in gold, although it was sudden and strong, is in line with previous corrections along the road in this bull market - a correction in a bull market.
CoBra(too)@Mk#1530693/5/07; 11:35:58

I totally agree with you:

...MK "In terms of the DJIA I agree with you. When you think about, we haven't seen a real correction in the Dow in many years. In fact, there is a case that can be made that this last upswing was really a bear market correction for stocks. I think the correction in gold, although it was sudden and strong, is in line with previous corrections along the road in this bull market - a correction in a bull market". ...

... Well, dear MK I sure do. In the short term we may have a problem as I've characterized as mad scramble for liquidity and that's not the end. What we're seeing is a mad scramble to the perceived security of bonds and even to the Dollar. If it wouldn't be so "terrifficly" outlandish - to "coin" a new phrase, as the new paradigms have become in tight supply - the severance from both the former safe harbours will surely do the trick.

... And yes, I'm with you on former corrections on PM gold markets - just go back to 1974 - that's where I think we are and it doesn't mean not to go on accumulating - it just means accelerate your acquisition on every downtick.

... And what would a few bucks more or less mean in A/FOA's scenario of 30.000 $/oz of Au. OK, since we're not there yet, I guess there's a big chance out there to even beat the oldtimers to their game and acquire reality at even better averages ...

Thanks and see you in a golden future (with some silver lining) ... cb2

Federal_ReservesCredit bubble popping.#1530703/5/07; 11:47:21

Folks are starting to SELL THINGS to make their payments. This is the reverse from just last year when they could hold on to things as they went up and just rollover the debt and take cash out. In my neighboor last summer average selling price of a home 550k, this last month 435k. Things are collapsing fast, and much faster than most people realize. Rich folk don't feel it yet. You can check your zip code and monitor your neighboorhood on the attached website.
TopazA method in the madness.#1530713/5/07; 11:50:46

Provided we accept that PoG represents only a paper claim on Gold in the future, a clear pattern can be identified vis PoG and the Buck/Yield composite.
What we poor sad Goldphiles need to happen is for Bonds to sell-off without ratcheting Buck up "too much".

"Gold" nowadays simply can't exist in speech without a qualifier ...or better put, the term gold has become merely a qualifier (adjective) in itself.

Pathetic little buggers we are!

If they remade "Paint your Wagon", the opening scene with Lee Marvin uttering the word "Gold" would be totally different ...he'd now be saying: Gold-metal, No no, not stocks ...or April Contracts, not unallocated ...or for that matter allocated, not certificates ...real honest to goodness Gold in hand.
Welcome to the 21st century!

I think I'll rent it this weekend ...for old times sake!

Topaz...meanwhile, back at the Ratio Ranch.#1530723/5/07; 12:09:21$gold:$silver&p=D&b=5&g=0&id=0

We're getting creamed here with the only positive being an almost complete retracement from 30-70 on the RSI without too much damage along the way.
It's still early days in March so I'd be not too keen to bail out on Aggie just yet.

GoldiloxPaint Your Wagon#1530733/5/07; 12:45:37

@ Topaz,

TCM has been running PYW this month. Check the listings. I watched it a couple days ago, Partner.

Topazlast one, I promise ...Alt Gold. #1530743/5/07; 12:49:07

Without too much difficulty we can identify on the accompanying Chart, 5 times during '07 (so far) where $PoG and altDX have headed in different directions.
This is the signature of a Stage 2 GoldBull ...and we're due for another cracker separation real soon imo.
DX 90-92, $PoG 1000 here we come!
...and Aggie? don't wanna know!

SurvivorRe: Credit bubble popping#1530773/5/07; 13:21:26

The MelissaData site referenced by below is an example of why we should always be careful to take data on the Internet with a grain of salt.

For my zip code, MelissaData shows that real estate prices have gone up by 465% since December 2006, and the average price is $446,000. Neither of these data points is even close.

Our real estate transactions and statistics are regularly posted in the local paper. For reasons driven by the local economy, prices are relatively stable and average prices are around $300,000.

There is no doubt the real estate and credit bubble is loosing gas rapidly in many areas, but MelissaData may not be the best place to learn the details about your area.

- Survivor

mikalGold#1530783/5/07; 13:40:36

Here is a small sampling of the many good comments Jim Sinclair and Monty Guild made on this and related subjects, since last week:
"What has turned gold into a fearful thing for the unthinking is threefold:

1)The unwinding of the Yen Carry Trade. This is a hot one. It assumes that major clients, hedge funds, have borrowed yen in order to buy gold thereby improving their leverage and profit on the long side. The leverage for floor traders, which is what most hedge funds get, is 95% credit. To improve 95% credit is a trick that borrowed yen will not even do for you. The long side is played to a degree by every black box, but that is about all needed to get a 25 to 35 year old schooled to hate gold, turning them into an enemy thereof. The last point is nobody has knowledge of the size of the so-called gold/yen/carry. Therefore it becomes the best of fear makers because like the expert in the field where there is no expert, they cannot be wrong.
2)The collapse of the Chinese gold demand interpolated from a regulator-engineered liquidation of speculation."

"Do you not realize the minute the false yen bull move ends, motivated by panicked carry trade shorts to the loan covering, that gold will parade right back up to and through $690?

Do you really believe a 7% growth in China is a debacle?"

"The answer is simple. As the momentum of the Yen upwards move slows, and internal indicators indicate so, then putting the yen for qualified speculators is rational.

The minute the up trend on the yen breaks down then the down trend on gold break out and up.

Review the inner working of the economic Gordian Knot tied and unmovable by economic management for political advantage by as many administrations as one can recall."

"Monty Guild's Commentary

As predicted by many, Venezuela's oil output is faltering under the wise and able leadership of Hugo Chavez. Today it was announced they are cutting production by 40,000 barrels a day at the famous Boscan field.

On another note, according to my wise friend Larry Jeddeloh, the money supply growth in the last 12 months for the UK M4 is up 13%, Eurozone M3 is up 10.6%, China M2 is up 15.9% ,South Korea M3 is up 10.6% , Australia's M3 is up 13% and Russia's M2 is up 48%.

With numbers like this it is obvious that global central banks are continuing to provide a lot of liquidity to the markets.

For this reason and others, we expect this correction to be relatively short, after which gold and foreign stocks should rally strongly.


"The Carry Trade is huge in gold, except no one can know.
The standard argument is that a slowing economy is bad for gold because inflation will decline. It will not! The Formula speaks for itself.
I have already suggested to you the carry trade and bullion buyers are a contradiction of terms. It is like saying the meeting of NASCAR fans will be held at the Westchester Country Club. They simply are not the same people. The carry trade is in equities and thereupon derivatives first and further, currencies, but primarily government paper. The scam commercials pull under cover is completed by hammering the silver price to tip off the Black Boxes both in silver and gold. The Black Boxes then do the work for the commercials..."

GoldiloxMelissaData#1530793/5/07; 13:48:28

Melissa Data offers an opportunity to download the list of sales used in the calculation month by month. Most zip codes contain more than one style of home, so the list should show if the data is skewed by over-weighted proportions of lower or higher priced units.

My zip code showed a peak in late 2005, early 2006. Probably about right, but my zip code is heavily populated, so anomalies tend to get lost in the sheer volume.

Quantity of units sold is another dropping trend in my zip.

mikalDollar dazed by dizzying dimensions of debt, derivatives and defaults#1530803/5/07; 14:11:19;article=109686;title=APFN

The dollar index may be popping nicely the past week or so, but it's technically no where near staging a bull run to the upside. Topaz could be right and the index clear some technical barriers. We all remember the lengthy period last year where POG and $ index rallied together- maybe for a few days this year- and now some calling for some more. Maybe they'll chop around but then they'd better hurry because this things heading for a climax soon IMHO.(You know my timetable). Thank you.
Sun Mar 4, 2007 19:06
The Condition of the Dollar
By Lindsey Williams
Excerpt: "There is so much to touch on regarding the dollar this month, I hardly know where to start. Regardless of where I begin, the news is not good and affects all of us.
First on our list is China. They have now announced that they are refusing to accept American Corporations purchasing into their stock market any longer as they did in the past. China also said that they are no longer going to be purchasing our securities as they have in the past, including bonds and T-bills. China's decisions and subsequent announcements at the beginning of the week has sent a panic across the World's markets.
Additionally, OPEC met recently and they have also stated they will be diversifying into other currencies instead of just the American dollar. They will now begin accepting other currencies and limit the trade of oil via the American dollar.

March 21st 2007 will be one of the most significant dates this month. Iran has outlawed the American dollar and will put anyone in jail that uses it in their country after that date."

Clink!What to do in a panic#1530813/5/07; 14:52:32

I find that the best thing to get a perspective on things is to look at a long term chart. The URL attached is a beaut covering 25 years. TA tends to be more reliable the longer a trend continues. If you look at the green lines drawn from 2000, you can see that this is, so far, part of a normal pullback. The support line appears to be around $625-630, which is where we are coasting to. If the PoG breaks this, then, yes, it may be different this time.

I mentioned when I posted for the competition that the uptrend appears to be getting steeper, and this is clearly shown by the second green line. I saw this on the log(PoG) vs. time chart, but I'm not sure how this correlates to a linear P&F one. One thing that the P&F definitely DOESN'T show is that the speed of the falls is 10 times the speed of the rises !


CometoseSinclair / Monty#1530823/5/07; 14:58:24

Evident is the GLOBAL LIQUIDITY surge...

Globalization = the goal until the NEW WORLD ORDER

to get all the players on board including CHINA and the Middle East ......

Banking eventually HOOKS every one in

LIQUIDITY is VASELINE to enable this process continue without mishap .... keep everybody in line and on que

Since Globalization is PRIMARY OBJECTIVE to the New WOrld Order , and LIQUIDITY IS THE GREASE .....and this is a long term goal .......


flow5Consolidation Period#1530833/5/07; 15:45:02

"On Wednesday, Bernanke told the House Budget Committee he could see no single factor that caused the market's pullback a day earlier."

This is, of course, economic nonsense. We saw in the first two months of this year, Jan. & Feb. 2007, the sharpest, and largest, draining of legal reserves in the history of the Federal Reserve. (for an explaination of legal reserves see Modern Money Mechanics:

What happened? The Manager of the Open Market Account uses the federal funds "bracket racket" as a "trigger" to guide open market operations. The FOMC maintained their interest rate target, but disregarded the level of legal reserves. This is another, of an endless examples, of an extremely flawed monetary policy. Our money supply can never be managed by any attempt to control the cost of credit, that was what the Treasury Federal Reserve Accord of 1951 was all about.

If monopolistic powers "administer" an upward shift in a price, the long-term effect will not be inflationary, but will be deflationary unless monetary flows (MVt) "validate" these specific price changes.

The monetary authorities use two tools to control the money supply--free legal reserves and reserve ratios. If these tools are to be effective, all legal reserves of all money creating institutions have to be in a form which the monetary authorities can quickly ascertain and absolute control. The only type of bank asset that fulfills this requirement is interbank demand deposists in the Federal Reserve Banks owned by the member banks. Similarly, the monetary authorities have to have complete discretion over changes in reserve ratios. This is essential since under fractional reserve banking (the essence of commerical banking) these ratios determine the minimum volume of legal reserves a bank must hold against a specific volume and type of deposit liability.

Congress should "bite the bullet" and require all commercial banks to have the same reserve ratio and reserve asset requirments (pre-1959 requirements pertaining to assets). And as a long-term proposition, get the commercial banks out of the savings business. Never are the commercial banks intermediaries in their lending process.

See: Reserve Requirements: History,Current Practice, and Potential Reform.

There has always been a seasonal consolidation period. This historically ends mid March.

mikalBernanke plucky parrot#1530843/5/07; 16:30:34

Midas Report by Bill Murphy - March 5, 2007
Snippit: "For the skeptics out there who remain clueless on all this market management stuff, one only need go to the public record. For example:


In Bernanke's speech at Stanford on Friday he admitted that the FED manipulates markets:


``Given their scale, capital inflows and outflows certainly influence long-term U.S. interest rates and other key asset prices,'' Bernanke said. Still, ``the Federal Reserve retains considerable leverage over longer-term rates and key asset prices.''


How many times do key officials have to confess to manipulating markets before the main stream press will acknowledge it happens?
Mikal-- Way to go Bill! Way to go Adrian!

melda laureThe difference between catching a falling gold bar and a china cup.#1530853/5/07; 17:00:37

yes it is most definitely a garden variety correction... so far...

SNIP: Are subprime mortgage lenders like New Century Financial and Novastar taking it on the chin?...

No, more like a bullet wound in the aorta. Do not mistake the twitching for signs of life.

ArcticfoxBanner now going across CNBC stating that gold has #1530863/5/07; 17:43:20

been in surplus since 2002..huh?
pilgrims_goldGolden Movies#1530873/5/07; 18:04:17

I like to create a list of movies with a gold bullion/gold plot line of some sort.
Have quite a few good choices and am wanting all posters to help add to this list.
My list so far in no particular order:
The Good, the Bad, and the Ugly (A search for gold by the 3 adversaries)
McKenna's Gold (That vein of gold on the moutainside would give you a heart attack)
Goldfinger (A how to on robbing Fort Knox, 1st-disable an army, 2nd-radiate the gold)
Treasure of the Sierra Madre (The Prospectors Bible Movie)
Kelly's Heroes (A lot of nice gold bars!)
A Fistful of Dollars (Clint seems to do a lot of gold movies)
Paint your Wagon! (Pardner!!!! Is that Clint aggin?)
The Maltese Falcon
All the Kings Men
Die Hard III (Need a lot of Trucks to hual all that gold under New York)

Im hoping to have all of these on dvd eventually

Paper Avalanche@ pilgrim#1530883/5/07; 18:12:42

I would add the relatively recent "Italian Job" to that esteemed list. Good plot, action and plenty of gold to look at.


LacklusterGene Hackman gold movie?#1530893/5/07; 18:18:24

There was a Hackman movie not too long ago, where he steals some gold off an airplane. Can't remember the title, it had a surprise ending, I won't give it away here.

Seems like a common theme to a lot of these gold movies is theft. Why would that be?

mikalPaper mache' party pooper?#1530903/5/07; 18:21:50

Financial Services
A New Worry For Wall Street
Liz Moyer, 03.05.07, 6:00 AM ET - - Excerpts:

"Last week's market turbulence and technical glitches have overshadowed an important regulatory change that kicks in this week. Beginning today, all trade orders are supposed to be routed to whatever exchange offers the best price, meaning markets like the NYSE Group's (nyse: NYX - news - people ) Big Board could lose share to smaller regional exchanges and electronic networks.

The impact won't be completely felt for another month, courtesy of a delaying action from the NYSE. Last week, the exchange received an extension from the Securities and Exchange Commission that gives it until April 5 before it has to comply with all of the new rules, which are called Regulation NMS...

The chief executive of one relatively new network, BATS Trading in Kansas City, said in an e-mail to a regular group of some 1400 readers that he was "concerned about the stability of the public markets in the transition to Reg. NMS."
David Cummings, the BATS chief executive, added, "I would urge all participants across the industry, especially those with high-speed automated trading models, to be mindful of any unnecessary loads their orders could place on the markets."

The messaging snafus were enough to pique the interest of the SEC, which has been talking to NYSE about what happened. Thain has denied news reports that a bigger investigation into this week's events is underway."
Mikal-- This doesn't seem to be so much 'much ado about nothing' as incompetence. The coming weeks(or days) should reveal just how negligent or consequential 'glitches'
figure to be in 'the program'.

Paper AvalancheZhou Xiaochuan just called me.... this is big news#1530913/5/07; 18:25:18

He said that he has been watching CNBC all day. After Liz Clayman's story this morning, along with the other compelling reports on gold, he is rethinking diversifying the PBOC's reserves into gold. He said that he may go with an ETF (if anything) if he wants to get back into the gold market in the future.

He also said that he will be calling Shanghai later this morning (it is early morning in Beijing) to recommend that they mothball the Shanghai Gold Exchange since gold is no longer a safe haven and the need for a formal gold exchange in China would appear to be useless going forward. He is looking for a more productive use of the country's FOREX reserves such as Fannie Mae or Freddie Mac common stock / bonds.

I know that many here think that gold will go up in the future, but after speaking with Mr. Xiaochuan and learning that China has no further interest in gold as a reserve asset, I am leaning toward cashing out my gold bullion position and possibly moving that capital into something that yields a dividend such as Ford or General Motors stock.

I wish everyone the best, but I think that gold's run is over and now is the time to get back into the market while stocks are cheap since that is what the Chinese appear to be doing.


David LinkleyWhat I have feared is now occuring#1530923/5/07; 18:45:32

Physical gold at these prices may never be seen again in our lifetimes. Only huge liquidity increases from the already high levels we are experiencing at this point in time can prolong the the current economic cycle. The desperation of the New World Order was indicated with repeated IMF begging to sell gold. The Euro offers no haven and all other paper currencies will decline vs. gold. Good luck all as additional liquidity may buy a little more time (keeping averages up) but the tranquil investing periods we have known are over. The subprime lending defaults are just one of many battles to be lost by consumers from this point on. The battle between the bankers and gold has now reached the point of no return. The winner will take all. Slavery vs. freedom is now on deck. What will you chose?
GOLD FINGERWHAT THE......#1530933/5/07; 18:57:57

REF:Paper Avalanche (3/5/07; 18:25:18MT - msg#: 153091)
Zhou Xiaochuan just called me.... this is big news

Your not serious...a joke?? I wonder who uses the anti gold cloaking devise.

Gold's low price is an opportunity to buy and get into the market. The demand for oil will continue. Gold will soon rise again!


Paper Avalanche@ Gold Finger#1530943/5/07; 19:03:05

It's true. He somehow got my home phone number and called me to discuss the items in my post below.

I appreciate your concern. I hope that other central bank presidents don't take this as an open invitation to call me whenever they want.

I love you man. You are the reason I get up in the morning.

Take care,

TownCrierLackluster, the movie is called "Heist"#1530953/5/07; 19:07:20

I highly recommend it.


USAGOLD Daily Market ReportPage Update!#1530963/5/07; 19:11:34">
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

Gold piggybanks tapped on global market weakness

March 5 (MarketWatch) -- Gold for April delivery closed down $4.90 at $639.20 an ounce on the New York Mercantile Exchange. Prices climbed briefly Monday to touch a high of $645.30.

U.S. stocks saw another tumultuous session on Monday, as the yen rallied against major currencies, while stocks across Asia ended sharply lower, with indexes in Japan, Malaysia, Hong Kong, and Singapore retreating more than 3%.

"Gold traders see the stock market recovery off the days lows and are growing more bullish that a financial meltdown is not in the works," said John Person, president of

"If this stock market continued lower, then I would have expected gold to fall as well -- mainly because hedge funds and others who are cashed strapped would be liquidating holdings to meet potential margin calls [and] one holding might have included gold," he said.

"For some who believe the global economy is still vibrant, buying gold is a bargain near the $640 level," said Person, pointing out that gold prices were at $690 just a few days ago.

The contract has lost $50.60, or 7.3%, from the closing level of $689.80 on Feb. 26.

"It certainly presents a lower risk to buy today than it did last Friday."

So contrary to the expectations of some market observers who believe that gold absolutely must rise during periods of duress, gold has been under pressure, Dennis Gartman, publisher of the Gartman Letter said.

"Gold remains a source of liquidity that can be tapped when it must be tapped," Gartman said.

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

GOLD FINGERGET REAL!#1530973/5/07; 19:15:03

Paper Avalanche (3/5/07; 19:03:05MT - msg#: 153094)

Sarcasm is not very becoming nor is it very courteous.

I thinks CHINA will never devoid it's self of gold and neither will it's people. As far as choosing a stock that pays meager dividends...they can have it. Why would anyone choose to invest in a company that is going down to begin with?

Paper Avalanche@ Gold Fingerrrr#1530983/5/07; 19:16:14

I love you man.


MKArticfox - Gold in surplus#1530993/5/07; 19:22:03

This is a nebulous concept as anyone who studies the tables can attest. Gold is never in surplus; never in dearth. On the contrary, it is always in balance with price the final arbiter. One can make a case though whether the suppliers or the demanders were more aggressive. In the current time period, the demanders are more aggressive and the shorts will do all they can to tilt the balance in their favor, including manipulate the press. In that respect, nothing has changed for more than a decade.
Rook.,.#1531003/5/07; 19:41:16

Hi All, well, if there ever was a reason for Kennedy to meet his maker, according to Fed backers, the following would be reason enough. Surprised to find this, but here it is.

"As the Federal Reserve overprints more money, the money supply inflates, and too much money starts chasing too few goods and services, which means prices go up. But contrary to the charade put on by the Federal Reserve, inflation doesn't just come and go due to some arcane sorcery. The Federal Reserve can halt inflation any time it wants to by simply shutting down those printing presses. It therefore follows that both inflation and recession are fully under the control of the Federal Reserve.

Over time, that excess of printing has destroyed the value of that dollar you think you have. If you want to know by just how much, go out and try to purchase 371.25 in silver right now. Usually, the deterioration is gradual. Sometimes, it has to be obvious, such as the 1985 devaluation (done to halt the trade imbalance) which triggered the Japanese real-estate grab in this country.

Many politicians have attempted to reverse this process. John F. Kennedy issued an Executive Order 11110, requiring the Treasury Department to start printing and issuing silver certificates for the silver then remaining in the US Treasury.

Kennedy decided that by returning to the constitution, which states that only Congress shall coin and regulate money, the soaring national debt could be reduced by not paying interest to the bankers of the Federal Reserve System, who print paper money then loan it to the government at interest. This was the reason he signed Executive Order 11110 which called for the issuance of $4,292,893,815 in United States Notes through the U.S. Treasury rather than the traditional Federal Reserve System.

John F. Kennedy's United States Note.

That same day, Kennedy signed a bill changing the backing of one and two dollar bills from silver to gold, adding strength to the weakened U.S. currency.

Kennedy's comptroller of the currency, James J. Saxon, had been at odds with the powerful Federal Reserve Board for some time, encouraging broader investment and lending powers for banks that were not part of the Federal Reserve system. Saxon also had decided that non-Reserve banks could underwrite state and local general obligation bonds, again weakening the dominant Federal Reserve banks".

Kennedy's executive order was never implemented following his assassination, and shortly afterwards, United States silver coins were taken out of circulation and replaced with the copper clad slugs in use today. These two events, the failure to print new silver certificates, and the substitution of worthless slugs for our silver coins, may explain why the Warren Commission included on its panel John J. McCloy, a man with no experience in crime, law enforcement, or national security, but who had been the President of the Chase Manhattan Bank.

pilgrims_goldHeist and Italian Job have been added to my list!#1531013/5/07; 19:45:30

Thanks guys, I knew the Italian Job should have been on my list but could not remember the name of the movie for the life of me, thanks! I never seen the movie Heist and will look for it in the DvD movie rentals for a night entertainment.
Every one of these movies someone was trying to steal the gold, bankers must of financed the movies!

Paper Avalanche@ Rook - Re: EO 11110#1531023/5/07; 19:51:34

I may be mistaken, but it is my understanding that the EO was actually carried out a few days before he was shot in Dallas. Immediately thereafter all US silver notes were removed from circulation. I am not sure if many ever saw the light of day, but I want to say that about $4 million worth got into the banking system only to be recalled a week or so later. Please see link below for a better review of the topic.

I may be wrong. I often am.


Chris PowellHow can the U.S. dollar survive profligacy like this?#1531033/5/07; 19:52:50

The Coming Entitlement Meltdown

By U.S. Rep. Ron Paul
Monday, March 5, 2007

David Walker, comptroller general at the U.S. Government Accountability Office, appeared on the television show "60 Minutes" last evening to discuss the federal budget outlook. If you saw the show, you know that he painted a very sobering picture regarding the federal government's ability to meet its future obligations.

If you didn't see the show, Mr. Walker's theme was simple: Government entitlement spending is like a runaway freight train headed straight at American taxpayers. He singled out the Medicare prescription drug bill, passed by Congress at the end of 2003, as "probably the most fiscally irresponsible piece of legislation since the 1960s."

When it comes to Social Security and Medicare, the federal government simply won't be able to keep its promises in the future. That is the reality every American should get used to, despite the grand promises of Washington reformers.

Our entitlement system can't be reformed -- it's too late. And the Medicare prescription drug bill is the final nail in the coffin.

The financial impact of the drug bill cannot be overstated. Government projections that the program would cost $400 billion over the next decade were a joke, as everyone in Congress knew even as they voted for the bill. The real cost will be at least $1 trillion in the first decade alone, and much more in following decades as the American population grows older.

The Medicare "trust fund" is already badly in the red, and the only solution will be a dramatic increase in payroll taxes for younger workers. The National Taxpayers Union reports that Medicare will consume nearly 40 percent of the nation's GDP after several decades because of the new drug benefit. That's not 40 percent of federal revenues or 40 percent of federal spending, but rather 40 percent of the nation's entire private sector output!

The politicians who get reelected by passing such incredibly shortsighted legislation will never have to answer to future generations saddled with huge federal deficits. Those generations are the real victims, as they cannot object to the debts being incurred today in their names.

The official national debt figure, now approaching $9 trillion, reflects only what the federal government owes in current debts on money already borrowed. It does not reflect what the federal government has promised to pay millions of Americans in entitlement benefits down the road. Those future obligations put our real debt figure at roughly $50 trillion -- a staggering sum that is about as large as the total household net worth of the entire United States. Your share of this $50 trillion amounts to about $175,000.

Don't believe for a second that we can grow our way out of the problem through a prosperous economy that yields higher future tax revenues. If present trends continue, by 2040 the entire federal budget will be consumed by Social Security and Medicare alone.

The only options for balancing the budget would be cutting total federal spending by about 60 percent or doubling federal taxes. To close the long-term entitlement gap, the U.S. economy would have to grow by double digits every year for the next 75 years.

The answer to these critical financial realities is simple, but not easy: We must rethink the very role of government in our society. Anything less, any tinkering or "reform," won't cut it. A good start would be for Congress to repeal the Medicare prescription drug bill.

Paper AvalancheEO 11110#1531043/5/07; 19:53:28

Here is a more detailed look into EO 11110.


Chris PowellPeter Brimelow: Mysterious movement in gold market#1531053/5/07; 19:54:34

By Peter Brimelow
Monday, March 5, 2007

NEW YORK -- Gold had a tough time in the past week too.

No stock market enthusiasts will have any sympathy, but gold's friends are aggrieved. A week ago gold bullion closed at a 2007 high, and early this past week made highs in several major currencies, a favored sign of bulls. But furious selling, starting rather strangely in the thin aftermarket after Tuesday's close in New York, ultimately sent the metal reeling to a $39 per-ounce loss on the week.

Not all gold observers were caught.'s Martin Pring, who places great faith in the predicative power of gold equities, was worrying in his Weekly InfoMovie Report about their nonconfirmation of the metal. And several old hands were suspicious about the ballooning "open interest" in gold on the New York Commodity Exchange. In essence, this is a measure of the size of the bet laid down by speculators in gold futures. Seeing it pass 2005's record high without a new high in gold set off alarm bells.

How big was the seller?

The Gartman Letter, which for a loudly self-proclaimed non-membership in the gold fraternity spends a lot of time thinking about the metal and is actually quite a successful trader of it got the message on Thursday morning: "We find it disconcerting that spot gold has seemingly badly failed in the past two or three days to push upward through $685-690. Whoever, or whatever, the seller is at that level, it has been formidable indeed."

The Gartman Letter acted, halving its quite substantial holding and converting the rest into a long-gold, short-Nasdaq spread, consequently avoiding two-thirds of the week's loss.

The size of the blocking operation which stopped gold imitating oil this past week in making and holding new 2007 highs, perhaps paradoxically, encourages the considerable school of gold followers who believe gold is subject to heavy but surreptitious manipulation by the authorities. This is because of their theory of the mechanism involved.

As one of their leaders,'s James Turk, says in the new edition of his Free Market Gold & Money newsletter: "As gold climbed in price, we witnessed in recent weeks the huge buildup of open interest on the Comex. The gold cartel ... was selling whatever ... it felt... needed to try slowing and then capping gold's advance ... the gold cartel finally succeeded in capping gold. ... Fortunately, there was no serious long-term technical damage to gold's chart -- nor do I expect any in the days and weeks ahead. Any reversal of gold's major uptrend is unlikely because the gold cartel is already covering short positions at these prices, which will provide underlying support for gold."

This concept that the "enemy" trades around the gold price, and are not just constant sellers, is a sophisticated point that open interest behavior in the past can be interpreted to support.

Others, of course, presume that gold was just caught in the general stampede for cash. This must be true to some degree, but the latest open interest data (Thursday evening's, with half the week's losses booked) do not really show it.

Gold, of course, is not just part of the spectrum of financial assets seen from the West. It is also of great interest to the Indian population, easily the world's biggest buyer of physical gold. Over at, Bill Murphy is expecting the Indians will step in and stop the slide. His proprietary Indian premium numbers (full disclosure: Once provided by my brother John) have not so far shown this is happening. But after Friday's losses perhaps they will.

Chris PowellJames Turk: Buying gold ETF isn't quite buying gold#1531063/5/07; 19:56:10

5:30p ET Monday, March 5, 2007

Dear Friend of GATA and Gold:

Buying shares of the gold exchange-traded fund sponsored by the World Gold Council isn't quite buying gold itself, GoldMoney founder James Turk writes in an essay adapted from the latest issue of his Freemarket Gold & Money Report ( Turk's essay is titled "The Paper Game" and you can find it at Jim and Mary Puplava's Financial Sense site here:

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

SmeagolSss... Neither are the Silver ETFs...#1531073/5/07; 20:28:12

"A seminal moment during our brief soirée into Orlando came when a curmudgeonly sort sauntered up to our booth and demanded why, when he sought to retrieve the silver bars he had laid into receipted warehouse storage at this nation's most premiere repository in New Orleans, they could not produce them but, per contract, would happily replace with new bars. They were not deadbeats, this New Orleans outfit. They would honour the contract. He would get bars of equal value. "Why cannot I get my own silver back from your storage?" he asked.

"We leased your silver," they told him. His bars were gone. That was his story to us. And then along comes, just Sunday, a missive from Bill Murphy of GATA and LeMetropole Cafe, alerting us to an article by Tom Lauricella, dipping out of the Wall Street Journal (not to be confused with the Wallace Street Journal) to the effect that Barclays ETFs, which make owning silver so painless and easy, may have a more nefarious agenda: turns out the reason that their ETF schemes are so inexpensive and transparent is that there's a back-door to the money. Says Lauricella, "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."

In other words, there's just a niggling chance that the silver Barclays claims to be holding on your behalf may already be leased to somebody else. May already have ceased to exist. But because you are so confident in your investment in iShares, you'll not demand delivery of the physical because you are so far just enjoying the ride. After all, why would a bank lie to you? And this is the nut of a Ponzi scheme: as long as only a few make physical demand, the game continueth. Ponzi schemes unravel not because of their size, but because they run out of trusting players."

Sun- or Moon-metal, if you don't hold the Precious, precious, It might not be there when you need It most. WHEN will people learn?? ~8-(

GoldiloxFive words from the web bots#1531083/5/07; 20:38:33

Since they are already public domain, I think it's acceptable to reproduce them here. See Geo Ure's for authorized elaboration.

"Beware the Ides of March!"

GoldiloxSeparation#1531093/5/07; 20:54:23

I think I'm beginning to see why physical may well sever its connection to paper gold at some point.

As long as the paper gold commitment is to deliver "like value", the short sellers can manipulate the price down whenever either delivery or liquidity put them behind the proverbial 8-ball.

However, at the point that real sellers completely dry up, they then dictate a fictitious "settlement" price and make the buyer go away with only FRNs.

Their line in the Kangaroo Courts will be, "If it were selling, this is how we would determine the "price".

They better hope they don't meet up with a Judge who is fond of the metallic critters, or if they do, better hope he is also fond of Executive Hunting Junkets.

PalSilver Certificate#1531103/5/07; 21:13:11

My grandfather gave me a one dollar silver certificate on my 18th birthday. It was circulated and was part of the 1957 series so it has no numismatic value. The link above states...
"On March 25, 1964, C. Douglas Dillon, the 57th Secretary of the Treasury announced that silver certificates would no longer be redeemable in silver dollars. This decision was pursuant to the Act of June 4, 1963 (31 U.S.C. 405a-1). The Act allowed the exchange of silver certificates for silver bullion until June 24, 1968. This was the deadline set by the Congress. Since that date, there has been no obligation to issue silver in any form in exchange for these certificates. You may be interested to know that the Congress took this action because there were approximately three million silver dollars remaining in the Treasury Department's vaults. These coins had high numismatic values, and there was no way to make an equitable distribution of them among the many people holding silver certificates.

Silver certificates are still legal tender and do still circulate at their face value. Depending upon the age and condition of the certificates, however, they may have a numismatic value to collectors and dealers."

...that last part gets me where it points out its worth at 'face value'. If I had been given a physical silver coin then it would be worth 13x face value. Just Another example of how paper money should only be used as a transactional unit and not a store of wealth.


TopazOh it'll happen G'lox.#1531113/6/07; 01:50:19

The separation that is.
As we watch, PoG is only permitted to rise "with" the mainstream markets.
When ALL market machinations are factored in, the conclusion that MUST be drawn is that, one day, PoG will be called on to "price" that which it represents ie: nothing more than a promise to deliver "something" (not necessarily Bullion) at some point in the future ...usually at the discretion of the promiser.
Naturally that "price" will be a sad reflection on Gold per-se.
Rather than poo-pooing Golds inability to provide a safe haven in shaky times, CNBC should focus on the flawed mechanism that prevents Gold ..or the pricing thereof, from functioning in it's historical capacity.

The recent downturn highlights the need for just such an Island of Tranquility in a futuristic genuine Market Maelstrom imo.

geBaltic Dry Index rising, Australia Coal Queue at Record High (1 March 07)#1531123/6/07; 04:58:07

Australia Coal Queue at Record High (1 March 07)

Baltic Dry Index rising

Is this the way the world economy slows down? Strange?!

LacklusterJones on Money#1531133/6/07; 05:51:17

six minute video
Chris PowellHousing slide won't hurt financial sector, treasury secretary says#1531143/6/07; 06:08:47;_ylt=Anly86fIWQjI_KtJ0xJO8uy573QA

From Reuters
via Yahoo News
Tuesday, March 6, 2007

TOKYO -- U.S. Treasury Secretary Henry Paulson said on Tuesday that a weakened housing market will not have a major impact on the U.S. financial sector, which he described as quite healthy.

In a roundtable session with reporters during a visit to Tokyo, Paulson said the housing downturn had had some impact on certain types of mortgages but he did not see it as a major problem.

"Some of the credit issues are there, but they're largely contained," Paulson said.

The U.S. Treasury chief was on the first leg of a three-country trip that will also take him to South Korea and China before he returns to Washington on Thursday.

He described global economic conditions as very healthy and played down recent drops in global equity prices.

"The global economy is more than sound," Paulson said. "It's as strong in the last couple of years as I've seen in a lifetime.

"All the economies are growing, inflation is low, and liquidity is high," he said.

Global equity markets have been roiled over the past week and a half by several factors, including the Chinese stock market's sharp drop last week and a comment by former Federal Reserve Chairman Alan Greenspan that a recession was possible.

Another factor cited in recent market declines was a reversal of support from a long-running phenomenon known as the carry trade, which involves using Japanese yen to invest in global equities and other higher-yielding assets.

Asked whether an unwinding of such trades was a concern, Paulson said he had no comment on yen carry trade.

Paulson described the Japanese economy as being on "a very good trajectory" but said it was very important for Japan to continue with economic reforms.

He said Japanese financial institutions were offering a wider variety of investment options so that savers were less dependent on low-yielding bank savings, and he said that was a promising development.

Paulson was also asked whether there would soon be an unfreezing of North Korean accounts held in Banco Delta Asia, the Macau bank that the U.S. Treasury identified as a "primary money laundering concern" in 2005, calling the bank a "willing pawn" in aiding illicit North Korean activities.

"We've had a lot of bilateral sessions with the North Koreans, and I believe it'll be resolved in an appropriate way," Paulson said.

"No one who runs a respectable bank wants to be unwittingly duped into financing illegal activity. We are going to continue to be vigilant."

flow5There will be no recession to hold gold back#1531153/6/07; 06:52:05

Our Federal debt 8.7 trill. is so high in terms of available taxable resources, disposable income of consumers, and business income, we dare not have a severe recession; nor can we stimulate the economy for fear of higher rates of inflation and interest rates. We are currently in a balancing act that we cannot long endure.
Rook.,.#1531163/6/07; 07:10:08

iran oil bourse threat -splained-.
Scenerio for gold to find another function, again.

AdvocatusThe Bolivarian revolution proceeds#1531173/6/07; 07:25:32

"You know, not far from the White House is a statue of the great liberator, Simon Bolivar. He's often compared to George Washington -- Jorge W."

"Like Washington, he was a general who fought for the right of his people to govern themselves. Like Washington, he succeeded in defeating a much stronger colonial power, and like Washington, he belongs to all of us who love liberty."


Up is down. Black is white. The evil emperor is
an anti-imperialist liberator of the people.

Vive la revoluci--n! Vive Jorge!

Clink!For once I disagree with Dr. Paul#1531183/6/07; 07:26:19

Well, not entirely.

David Walker, Comptroller General at the Government Accountability Office, appeared on the show "60 Minutes" last evening to discuss the federal budget outlook. If you saw the show, you know that he painted a very sobering picture regarding the federal government's ability to meet its future obligations.

If you didn't see the show, Mr. Walker's theme was simple: government entitlement spending is like a runaway freight train headed straight at American taxpayers. He singled out the Medicare prescription drug bill, passed by Congress at the end of 2003, as "probably the most fiscally irresponsible piece of legislation since the 1960s."

When it comes to Social Security and Medicare, the federal government simply won't be able to keep its promises in the future. That is the reality every American should get used to, despite the grand promises of Washington reformers. Our entitlement system can't be reformed- it's too late. And the Medicare prescription drug bill is the final nail in the coffin.

End snip.

Everything he says is true, except that I think we can guarantee that the government will honor every cent of the promise. Quite what it will be worth at that point is anyone's guess, however.

But it does bring to mind (yet again) the curious fact that people in positions of power seem unable to act in the face of the blindingly obvious. One can say that an elected official is only interested in keeping the electors happy until he or she is no longer seeking office, and it can also be pointed out that government retirement and health schemes are not the same as for the masses. But don't these folk at least have brothers, sisters and children who will be royally bilked ?

Of course, the cynical (or better informed/educated) may realize that the positions of power are not where the real power lies, but you have to think that occasionally the PTB would make a few more mistakes and let a few loose canons shoot their mouths off. But the case of the admirable David Walker, who has been pretty loud and unequivocal for some time now, shows that people don't want to see the really bad news. I guess that's what's known as hysterical blindness.


Clink!@ Chris Powell#1531193/6/07; 07:32:00

"Housing slide won't hurt financial sector, treasury secretary says"

I got a sudden flash of the Mogambo screaming "HaHaHaHaHA!" at the top of his voice, while twin streams of tears of laughter course down his face, which is purpling in hypoxia, due to his having difficulty in pulling a breath.


Rook.,.#1531203/6/07; 07:32:18

Is the flaw with the plans of the iran bourse/euro dreamers, is the flaw the reality(?) that the euro has, as one of its functions, the function of a release valve for those that oppose the us, but in reality, the euro top guys are on the same team as the us elites, and will not upend the dollar riegn as perhaps china/russia, and some middle eastern nations would like. Opponents of the us run to the euro, which in reality is a partner of the us while posing as an opponent.
How do you upend a reserve currency anyway?
Cant the us destroy a competitor by printing dollars by the gazillions and buying, in this scenerio, euros?
The euro boys dont want to have the euro rated high anyway do they? And for what? The Iranians? What benefit is the trade off? So even if the iran oil bourse gets to start, and many nations change over to euro, wouldnt the euro boys themselves just buy dollars with all the extra euros?
Thereby keeping the game of the dollar alive?
MK said once that the euro is/will take a turn, I wonder his, or anyones thought on the structure of the currencies to be able to handle even a large switch to oil/euro trading. Before iraq, was chirac really pushing for the euro/oil behaviour of saddam, or was it actually a front because his elites are part of the us dollar elite boys.
And, either way, did the fall of saddam make it so the euro is now fully tied to the NWO and it is just appearences, for the sake of the NWO end game, that makes them appear to the iranians as a non dollar, non "empire-hedgeonomy" ally?

USAGOLD / Centennial Precious Metals, Inc.Soundbites & Solutions#1531223/6/07; 07:35:18

gold and volatility
slingshotLackluster#1531233/6/07; 07:37:47

Good informative video.

OvSGeneral Thoughts.#1531243/6/07; 07:40:08

I see that my good friend
CB2 is still alive and
kicking which, somehow,
makes my trigger-finger
itch. But, easy, OvS, he
sometimes is alright, really.

One thing has troubled me
since I'm part of the USAGold
forum.In order to be a sustain-
able business it has to practice
"feast and famine" marketing. I
mean, it HAS to do that in order
to just generate enough income
to be able to support this forum.
Meaning: Get the members buying
while the excitement is high, though
we "old, wise" fellows know that
it be three-steps-forward-and-two
steps-back-kind-of-a-struggle to
get the gold-price where it belongs.
Rather than step on the bandwagon
when the sap runs strong or is about
to, and rather then offer a beautiful
gold coin for dumb luck guessing, be-
cause that's what it is, rather, offer
a price as in good times past, for the
most effective essay to stimulate our
membership (especially the new ones)
to just keep investing steadfastly one
coin at a time, perhaps, but, stead-
fastly, and never look back, and never
count the worth of it, but just like
taking a breath, and then another one,
on and on, accumulate, no matter what
the price of paper gold is doing. This
not only will give each member a lasting
worth, but will build up a national
treasure that in time will be the back-
bone of America when the chips REALLY are
Every organic entity has various centers
for various functions and the US of A
definitely is the center of finance. On
a global scale, and that is the game now,
if we like it or not, it has earned that
distinction and I must agree, no other
place would have the drive or knowhow, yes,
and singleminded one-upsmanship-kind of
mind to challenge it for the forseeable
future. So be it.USAGold should feel that
it has a holy mission to fulfill. And for
that I'd recommend that it starts branching
out in a network, all over America. I'd bet,
that most members would be interested in an
equity position in a branch near them, if
USAGold would become a true dealer-ship kind
of organization, buying and selling, instead
of being a broker.
Sorry knights, I just wanted to make a small
point and here I'm rattling off. Restrain
yourself, OvS. Instead of loading up when
you get excited, give it to them, little by
little, steadfastly. OK?

Rook.,.#1531253/6/07; 07:43:46

Is/was it a false flag. When the iraq "threat" to swith to the euro was ongoing, was it part of a ruse by big boys, that saddam did not understand, that by making it seem like they were really a threat to the us dollar by swithing to the euro, it would telegraph to other nations, iran for one, the idea that the euro really was a threat to the us, however, if push ever comes, the reality would be revealed, that the two, euro and dollar, are controlled by the same guys, and so opposition to the us, as the nwo unfolds, will rally around the euro, and howling european govt leaders, but it will all be a ruse.
just guessing.
These guys have been playing chess for a long time.

Rook.,.#1531263/6/07; 07:50:18

sorry about multiple postings, final one.
IF that is the case, then indeed the NWO guys really dont have an achilles heel do they?

GoldiloxEquity?#1531273/6/07; 07:53:15


OvS is ready to "derivatize" MK's castle.

Having been through one successful IPO, I can tell you that it instantly requires a doubling of staff, just to handle the IR and IPO support capacity.

Then MK would have to get his wardrobe ready for that famous Wall St "tour".

contrarianI'll Believe That One When Pigs Fly#1531283/6/07; 07:57:24

Re "Housing slide won't hurt financial sector". Yeah right! Amazing nowadays how everything is spin and nothing about the truth. The subprime real estate collapse is the final nail in the coffin of the American economy and will propagate through the system over the next two years if not sooner.

"The last duty of a central banker is to tell the public the truth." - Alan Blinder, Vice Chairman of the Federal Reserve, on the PBS Nightly Business Report, 1994

Goldman, Merrill Almost `Junk,' Their Own Traders Say (Update2)

By Shannon D. Harrington

March 2 (Bloomberg) -- Goldman Sachs Group Inc., Merrill Lynch & Co. and Morgan Stanley, which earned a record $24.5 billion in 2006, suddenly have become so speculative that their own traders are valuing the three biggest securities firms as barely more creditworthy than junk bonds.

Prices for credit-default swaps linked to the bonds of the New York investment banks this week traded at levels that equate to debt ratings of Baa2, according to Moody's Investors Service. For Goldman, Morgan Stanley and Merrill that's five levels below the actual Aa3 rating on their senior unsecured notes and two steps above non-investment grade, or junk...

slingshotSir OvS#1531293/6/07; 07:59:08

USAGOLD is a business and with any investment you must do your research. Is there any other site that offers gold for your thoughts? Have you benefited from the information on this board. If the Newbies want to get into gold let them call and talk and after decide if it is a good deal.
Yes your question is one to think about but you came up short somewhere.

Just answering your question.

OvSGoldilox & David Slingshot#1531303/6/07; 08:35:44

You got your points. Though,
how about joining of forces
with Sinclair? His seasoning
would complement MK's and his
playmoney could provide the
initial funds... Hey, I'm
dreaming of course, but its
minus 13 outside and with the
windchillfactor minus 35. My
1982 Volvo with 246,000 miles
has a slight problem (probably
the fuelpump relay has to be
replaced) so I can't even get
to the nearest liquor store to
get a refill of brandy. Just
proves one can't plan enough
ahead, and not everyone is
like our BB. But, I'm learning,
slingshot, yes sir. OvS

OvSDerivatize MK's Castle?#1531313/6/07; 09:07:15

Risks? You bet.
Nicholas Deak comes to
mind. A big man one
year finito the next.
I actually sold them
a goldcoin ages ago.
They attached it to
a string, pinched it with
a fingernail and could
tell by the sound of it
that it was pure.
And Mr.Safra, oh boy. Gold
is a high-stakes game
and I don't know if MK
has a little 007 in him,
or, better, Mr.Goldfinger
in his gut. But, who knows,
what about Mr. Straus, and
I'm not talking about the
Waltz-Master; could he rally
the Knights?

TownCrierOvS "What about Mr. Strauss..."#1531323/6/07; 09:30:33

Me? Able to rally the Knights???

First-hand experience answers that matter with a decisive "No!"

In fact, it reverberates among these walls so definitively that I'm nearly convinced that neither could I successfully lead a 3-year-old to the sandbox.



Cometosetreasury secretary commentary#1531333/6/07; 09:47:33

He's in the fareast;

What is he supposed to say ......

He has to market ....

(that's advertise) with a further view toward SELLING ..

Guys that far up the ladder aren't supposed to have to sell

continued buying(bonds and securities) will continue to act as a cushion and a support ..

The Constitution has proven to be for sale ; Perhaps Paulson is trading something else to get continued support for our bond market........

As a dealmaker ; he's showing them the deal , they must be getting something else....

1st option on DEISTRESSED PROPERTY , when the hammer falls.

THERE is going to be ANOTHER (savings and loan ype) debacle

Maybe last weeks fall in the equity markets was part or the deal to show the Chineze how GOLDMAN managet markets. It's unlike the big boys to let the markets fall like they did last week ...

Where did they put all those bundles of SECURITIZED mortgages (trillions worth) .....Securities , hence they went into MUTUAL FUNDS,,,,,and other (poop shoots) of the stock market........and as ocllateral backs to BONB ISSUES
bon bon BOND BOMB ISSUES.......

If the Chinese would just keep kindly buying these issues , we promise to continues to help maintain an orderly market in these worthless peices of paper.....

BETTER for the U S to hold these peices of CACA over the heads of the CHINEZE than for the CHinese to hold them over the HEADs of the WASHINGTON WHORE BANKING ESTABLISHEMENT......

Who's going to eat the cheese banana...carrot....

who's leading who...?

WHo's sold what ?


I PRAY THE CHINESe aren't buying the BAD BS from PAULSON.

WE caused the currency crises of the last decade to try to stop them

Since then we have threatened them with the rumor of GERM WARFARE....

and now we are trying to sell them something to help prop of the consumer side of their economic equation .....


IF i was in a the last round of a poker tournament and I was holding two aces in Texas Holdem and there was an Ace and two kings on the flop and my opponent came offering me a deal

I'd probably do what the Chinese are doing .....

GRIN inside and keep playing .....

I heard that they like our beautiful country and that they haven't enough land or clean water......

Picture Paulson in a MAID UNIFORM waiting on CHinese dignitaries with a silver tray ....covered with WHORES D'OEVRES

osa104cWhite Wash.......#1531343/6/07; 11:55:42

Has anyone else noticed the skepticism displayed by the talking heads? Reminds me of the line in BLAZZING SADDLES when Mel Brooks character stated "We must do something to save our phony-baloney jobs."

Any bets on the equities tanking during/after Bernanke speaks…….?…HM?….AMF

mikalThe flowers are blooming, what a fine day#1531353/6/07; 12:27:46

Goldman Sachs warns of 'dead bodies' after market turmoil
By Ambrose Evans-Pritchard, International Business Editor
Last Updated: 2:19am GMT 06/03/2007
"The global currency storm of the past week is starting to infect the corporate bond markets and may prove harder to contain than last year's May sell-off, Goldman Sachs has warned.
Jim O'Neill, the bank's chief global economist, said investment firms playing the "carry trade" had been caught on the wrong side of huge leveraged bets against the Japanese yen."
Mikal-- Just the first in a series of opinions I am sampling from this article. Great simplification occurs
with regularity in the media and these comments reflect this. For example, no mention of leveraged derivatives, the gold carry, the swiss franc carry, and a great deal more risks or more accurately, time bombs.
And the article hasn't been updated to reflect the recent "stabilization" in the yen and global equities, though it does warn that it will take time to assess the damage.

""There has been an amazing amount of leverage on currency markets that has nothing to do with real economic activity. I think there are going to be dead bodies around when this is over," he said. "The yen carry trade has reached 5pc of Japan's GDP. This is enormous and highly risky, as we are now seeing.""

"Mr O'Neill said the danger was contagion to low-tier bonds, driving up the cost of borrowing for business.
"Our concern is that the repricing of risk we are seeing could spread to the credit markets. This is potentially more difficult to deal with, and needs watching," he said.
The Itraxx Crossover index used to take the pulse of corporate bonds shows that spreads have widened 43 basis points in a week."

"Stephen King, chief economist for HSBC, said it would take two or three weeks to gauge the severity of this shake-out. "The world economy is fundamentally strong, but this reversal of one-way bets built up over years creates great uncertainty. The key worry is that this could reveal a weakness in the architecture of financial markets. We just don't know who is trying to liquidate positions," he said."

Mikal-- Sublime understatement:
"Steve Pearson, currency strategist at HBOS, said global markets were waking up to the reality that perma-growth with low inflation was not on the cards. "We're seeing a creeping reassessment of the trade-off between growth and inflation. This is going to weigh on asset prices and threaten risky assets all through the first half of this year."

GoldiloxIdes of March#1531363/6/07; 12:56:49

@ Mikal,

"Stephen King, chief economist for HSBC, said it would take two or three weeks to gauge the severity of this shake-out. "The world economy is fundamentally strong, but this reversal of one-way bets built up over years creates great uncertainty. The key worry is that this could reveal a weakness in the architecture of financial markets. We just don't know who is trying to liquidate."


Looks like someone besides the web bots is targeting the "Ides" and succeeding weeks.

The caca is hitting the revolving air circulation system, indeed.

Don't expect the real news to tell us who is getting hammered. It will take a lot of rumor investigation to actually figure it out.

mikal@Goldilox #1531373/6/07; 13:09:11

I concur 100%. And so does gold, if you read this (and read between the lines), you're left asking what's up:

Gold breaks losing streak on Asia, Europe rebound
Myra P. Saefong & Polya Lesova, MarketWatch
Last Update: 2:02 PM ET Mar 6, 2007 -- Excerpts:
SAN FRANCISCO (MarketWatch) -- Gold futures closed higher Tuesday to register their first gain in six sessions as a rebound in Asian and European stocks as well as gains on Wall Street helped boost demand for the precious metal.
Gold "is looking at forming a base around the $640 level," Emanuel Balarie, senior market strategist at Wisdom Financial, said in e-mailed comments.
"The recent decline from the highs has put gold in an oversold position, and I would expect any type of stability in the global marketplace to spur an onslaught of fresh buying, especially out of Asia," he said.
Gold for April delivery closed up $7 at $646.20 an ounce on the New York Mercantile Exchange. The contract had declined 7.3% from the closing level on Feb. 26.
Some analysts believe that prices will return to their levels from two weeks ago.
"Investors that blink might be surprised to see the price of gold back at last month's highs within a relatively short period of time," said Balarie. "In light of continued inflationary pressures, a weak U.S. dollar, and geopolitical tensions, the decline of gold was fundamentally unwarranted."
'Investors that blink might be surprised to see the price of gold back at last month's highs within a relatively short period of time.'
— Emanuel Balarie, Wisdom Financial
In a note to clients, Neal Ryan, director of economic research at Blanchard said the "return of money to the precious metals' sector this week should be fast and furious, pushing prices back up to levels seen two weeks ago ($660-$680)."
"Volatility from the last week is settling out and money is being redeployed into markets," the European Central Bank will announce a decision on interest rates Thursday and U.S. employment data and international trade deficit figures will come out Friday, he said.
In the meantime, data on fourth-quarter productivity, housing sales and factory sales were released Tuesday, and "the numbers are weaker across the board than was expected," he said.
"All of the above should combine to push precious metals' prices back up in short order," he said.
Looking further ahead, Peter Spina, chief investment strategist at said he sees two scenarios for this month.
Gold could rebound strongly from these levels and consolidate around the mid-$600s, or it can reverse and power ahead -- ending the month "approaching or exceeding the $700 mark." But he said it seemed unlikely the retreat "will last very long."
Still, "questions and valid doubts remain about the near-term and intermediate time horizon prospects of the precious metal in the wake of recent events," said Jon Nadler, an analyst at Kitco Bullion Dealers, in emailed comments.
"A true resumption of the bullish march may have been set back by weeks, if not months," Nadler said. "Volatility will remain a defining feature for the time being, as investors are keeping a nervous grip on various triggers."
James Moore, analyst at, wrote in a note to clients: "Physical players and bargain hunters will be keen to take advantage of sub-$650 gold, but I think the yellow metal may have to weather a little more weakness before short-term sentiment improves."
"The long-term outlook remains strong though, with the current dip likely to be viewed favorably by investors seeking to enter the market," Moore said...

"Crazy as it might seem after watching a week in which prices were down $40 per ounce, last week's activity and subsequent flight to cash across the board will help to strengthen investor interest in the future for precious metals," said Ryan.
"Fundamentally, the supply/demand aspect of the precious metals markets couldn't look more bullish and investors have been presented with yet another nice dip in which to enter the market," Ryan said."

mikalOdds and ends#1531383/6/07; 13:36:34

Greenspan sees 33% chance of recession
USATODAY - Bloomberg News - March 6, 2007 - Excerpt:
"Former Federal Reserve Chairman Alan Greenspan told Bloomberg News that there's a "one-third probability" of a U.S. recession this year and that the current expansion won't have the staying power of its decade-long predecessor.
"We are in the sixth year of a recovery; imbalances can emerge as a result," Greenspan, 81, said in an interview with Bloomberg News.
"Ten-year recoveries have been part of a much broader global phenomenon. The historically normal business cycle is much shorter" and is likely to be this time, he added."
-- Bernanke and the maestro, all in one neat package. But like a jack-in-the-box at the end of the song, these jacks of all trades lose some entertainment value as we mature.

mikalTypo#1531393/6/07; 13:40:38

"the maestro" NOT the maestro. Glory be, that was a close one. ;)
Silver FoxUp, up and away, oops, smack time...#1531403/6/07; 14:04:10

With both the POG and POS on the rebound, I am think'en that POG will go through $700 this time and the POS will go through $15. 'Bout' the time it does, Paulson & Bernanke will have to go back to work smacking them down again, with some more of the "high quality" paper...


Placer GoldBuying One Bullion Coin at a Time#1531413/6/07; 15:05:51

Not everyone on this forum will ever become a big player, and some who may just be venturing out into the world of physical ownership of gold and silver might want to go slow at first. The overhead when purchasing just a single gold buffalo is discouraging. I understand that a company like our host needs to make money and that selling one coin at a time requires them to charge a premium. Here is a suggestion. Continue to charge the necessary premium but for each small transaction allow the buyer to accumulate a "contingency credit" which will kick in on say the 10th coin purchased so that the buyer gets all or some of his single coin premium back. This will encourage a customer both to remain loyal and to want to accumulate more gold especially as he nears the point where the credit kicks in. It seems like a sound business practice to me.


Palet tu Bruté#1531423/6/07; 15:25:45

@ Goldilox and Mikal

Laird in his article linked above made me think of the latest web bot warning from George Ure.

Christopher Laird:
"The other problem is the Yen carry trade is still very much out there, like water flooding our Aircraft carrier. Sooner or later, the weight of that will again cause successive waves of market liquidations.

Ultimately, it may turn over. (read great world stock collapse).

That remains to be seen, but it certainly is the big question of the day as to whether the ship fire fighters can put out the blazes, and the pumps keep ahead of the inrushing water, (ever pressuring Yen carry still outside the hull trying to get in) on our wounded market ‘Aircraft Carrier’.

In the Asian crisis of ’97, that was barely done. (a world wide financial and liquidity collapse happened anyway).

This time, I consider the risks far greater. The Yen carry since has grown to incredible levels. And leverage in every market has also grown to incredible levels, and then add on top of that the explosion of the derivatives business – formerly at only $20 trillion about 1990, that is now, in my estimation over a $quadrillion in value (1000 trillion)."

Web Bot:
"However the actual [visible flip/roll] shows for February 27. The coming period of 8/eight days leading up to the Ides of March release period will also be presenting more [visible] (manifestations) of financial crumbling, but by that time, it is far too late to react to stem the process. In fact, as of this interpretation, ...alea jacta est/the die is cast. Start running now, just guess correctly as to which way the iceberg will roll."

Maybe we could join the two descriptions above and tell the tale thus...
A week ago the ship RMS Novus Ordo Seclorum sailed directly into the largest debtberg in all of recorded history. As we speak the great sea of liquidity is quickly entering the starboard side of the great ship and quickly rising to the first bulkhead, PPT. Giant chunks of derivatives, ARMs, and Yen-Carry are breaking off and causing further damage. The watchful individuals whose concern was raised by the speed of the ship were already on deck and saw the 'berg from afar. The party-goers did not heed the warning of those on deck and will soon find the ship without enough golden lifeboats to go around. There is still time though to find a golden boat and get to safety before the giant debterg reveals its true size and flips over to crush the mighty ship.

Lackluster.#1531433/6/07; 16:22:52

Pal, I, for one, like your hybrid tale!
USAGOLD Daily Market ReportPage Update!#1531443/6/07; 16:28:01">
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.

TUESDAY Market Excerpts

Physical buying drives gold higher

March 6 (Reuters, DowJones) -- COMEX gold futures finished 1 percent higher on Tuesday, helped by renewed physical buying after sharp losses in previous sessions, as global shares rebounded after a tumultuous sell-off last week.

The most active April contract settled up $7.00 at $646.20 after bottoming at $634.50, a level last seen on Jan. 19. It hit a session high of $648.90.

David Meger, metals analyst at Alaron Trading, said that a rebound in the Asian and U.S. shares prompted physical buyers to enter the market.

Meger said that gold also got a reprieve from the selling pressure by funds that was seen in the last few sessions. He also cited short covering for gold's gain.

Bernard Hunter, director of precious metals marketing at ScotiaMocatta, cited bargain hunting and a stronger yen, which made prices relatively cheaper for bullion investors in the Tokyo market.

The yen last week posted its biggest weekly percentage gain against the dollar since December 2005. The Japanese currency dipped against the dollar on Tuesday.

The metals lately have been "money-flow markets" more so than markets moving on fundamentals, said Bill O'Neill, one of the principals with LOGIC Advisors.

"If there is one phrase I'd use for today, it's that there is clearly a different money-flow pattern than there has been in the last week," he said.

"But certainly these markets are not out of the water and we need to see more normalcy come in. The jury is out and it's premature to say that everything is over."

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

OvSTrust, ect.#1531453/6/07; 16:36:24

Why do foreigners invest in the
US stockmarket and trillions into
the US bond and treasury markets?
Are they really stupid? No, they
are clever and sharp like rasor-
The simple answer is:
They want to sell 10 billion of
whatever, or buy, the US market
will accomodate them. LIquidity!!
When you think about it: liquidity
equals to trust and confidence.
Let's say you are a successful
Chinese. Would you rather trust the
Japanese markets or Europeans, or
the US markets? When it comes to
the really big deals, there is no
equal to the United States Market.
All these Arab trillion, made with
oil revenues. Where do they wind up?
In Manhattan and London. Who else
can you trust with billions? Who is
the largest single investor in a
Jewish run Citi Bank Group? An Arab
Prince from Saudi Arabia. Get the
picture? (Yes, it used to be the
WASP money that dominated the banking
industry, but they have been margina-
lized by the more daring tribes, and
rightly so). That's not politically
correct, so ignore the previous
sentence. Anyways, trust and confi-
dence. In India, there are really
major problems with that. Lots of
fake jewellry, etc. That's why I think,
USAGold would do extraordianrily, on
a world-wide basis: it would beat hands-
down any other foreign gold-retailer
on that score: trust and confidence, and
foreigners would flock to its dealer
ship deals.
So what's the problem?
Well, liquidity and trust and confidence
only go so far. When liquidity (injec-
tions of the Federal Reserve) is used
to CREATE trust and confidence, then
watch out... There is a fine point in
blancing these entities and that balncing
act I leave to more accomplished jogleurs
and hope for the best. In order not to be
left out in left field, I have the safety
net of precious old-age verified assets.
I might be short on quick gains in quick
deals, but human nature usually reasserts
itself and my precaution will save my
needs and my childrens. OvS

flow5Greenspan#1531463/6/07; 17:46:29

I don't know why Greenspan thinks anyone respects his opinion. His conundrum (the payments gap that's filled by foreigners) was, at his helm, what produced the housing crisis.

Allan Greenspan discontinued publishing two important economic statistics; 1) M3 in March 23 2006 (all countries conducting monetary policy on a prudential reserve basis report M3), and 2) the debit series in October 1996 (elminating the only valid velocity figure)

Under Greenspan's tutelage the Federal Reserve caused the 87 stock market crash, thwarted Bush senior's re-election challenge, drove the Y2K stock market bubble, forced a bear market, created the subsequent recession and corresponding deficits (the war not withstanding) and sanctified our gross housing speculation (avg. price of house rose 83 percent in 5 years).

Dr. Greenspan presided over the Asian currency crisis. He completely ignored the most important reasons for the crisis – growing current-account deficits, excessive short-term foreign borrowing, banking sectors weighed down by speculative property loans, and pegged exchange rates.

Dr. Greenspan tenure covered the current account deficit, which from the time he was sworn in, to the time he left office, amounted to the collosal sum of 5,139 trillion.

To put the current account deficit in perspective, the cumulative deficit of 5 trillion, is equal to the "combined market capitalization of the following fifteen Dow Jones companies: Alcoa, American Express, Boeing, Caterpillar, Coca-Cola, DuPont, General Motors, Hewlett-Packard, Home Depot, Honeywell, 3M, McDonalds, Merck, SBC Communications, and Walt Disney".

For Dr. Greenspan to speculate that the U.S. could lapse into a recession is preposterous.

melda laureyesta ya#1531473/6/07; 17:51:09


I would have thought the bidness sells itself when prices are high... When POG is floundering is when the old timers advice comes in handy.

GOLD FINGERGOLD shines on!!#1531483/6/07; 18:32:24

Hello to ALL TRUE gold bugs!!

REF:flow5 (3/6/07; 17:46:29MT - msg#: 153146)

I don't really like Greenspan either Flow. However, he gained the world's ear with his last calling as Chairman of the FED. Can anyone really do the job? Even with the current genius Ben? It was absurd for the Government to even create that department/branch/calling/ in the fist place.

This was only because most in Congress are to ignorant to handle it as a committee! To allow some man or for that matter any man to dictate the issuance of rates and other economic information is what's ridiculus.

He may have a point with "his recession" forecast. If the slump in the housing sector lasts long and the Price of OIL increases significantly we could slide right into one. I mean...we have had them in the past!


mikalEchos #1531493/6/07; 23:35:38 RGE - US and Global Financial Turmoil: Ten Observations on the Coming Financial and Economic Hard Landing by Noriel Roubini | March 5, 2007
Summary of a larger piece on the US and world economies. Very incisive with some original thinking and disturbing implications. (Peter Schiff just wrote a similar piece today, but was upbeat about prospects for some select, mostly foreign stocks, bonds, and currencies, unnamed, and strongly endorsed gold.)
You'll notice some high quality comments following Roubini's summary, especially immediately after it was posted(probably the first on the ball).

LebiequeDerivatives revisited (on an old joke)#1531503/7/07; 00:32:39

Explaining derivatives is often a long and tedious affair. But it doesn't have to be. Take that guy who bought and paid cash of a thousand Nam$ for a cow of his fancy, on the premise to have it delivered the next morning. Come next morning, prior to delivery, the cow died. On wanting his money back, he was informed that it was his own cow that had died. Nimble on his feet, printing and selling five hundred and (?, for service fees) raffle tickets of two Nam$ each, with a cow as first prize, was but a short mornings effort. The raffle winner, as sole complainant, got his money back unobtrusively.
GOLD FINGERWHO IS SPOOKED HERE??#1531513/7/07; 02:21:35

Hello Friends,

I find it interesting how some so called investors in other countries and here in the US can at times be very jittery about their stock portfolio. I am often amazed at how they behave and act.

By owning stock and entering that market you might think your so called "prudent" investing would be something not to worry about or even tinker with. Yet, oddly, so many jumped when wolf was called out.

Now, if they could hold onto what they own and then add some gold to what they have and ENDURE maybe they could sleep at night.

I do think there is a tremendous difference in the way physical gold owners behave Vs. the way paper holders behave or act. It's like they have a nervous twitch and are always looking behind their backs and rolling over thinking while they try to sleep....will the Asian markets crash again tonight??

I take personal comfort that the gold I have is right at my feet and I know where it is and it sure helps me to BEHAVE!! Not to mention sleep.

Get some to calm your nerves today!! Better than Valium!


LacklusterWho is Spooked?#1531523/7/07; 03:23:44

These guys:


Gold piggybanks tapped for other market losses

March 2 (Reuters) -- The global flight from risk knocked gold and silver hard for a third straight day on Friday, with bullion falling below $640 an ounce for the first time in 1-1/2 months...


Flying from risky gold and silver.

LacklusterTwo $ trillion in 401(k)s ?#1531533/7/07; 05:54:37

Yikes, I didn't know that!

Why don't these people get a little gold, no hidden fees there.


"More than $2 trillion is invested by U.S. workers in 401(k) plans, named after a section of the U.S. tax code. Money is invested into the plans through pretax payroll deductions. Withdrawals may be made around retirement time."

CopperfieldCredit ratings raised because government will bail out banks in a default??#1531543/7/07; 06:06:48

JPMorgan, Wells Fargo May Receive Top Moody's Ratings
By Mark Pittman and Joseph N. DiStefano

March 2 (Bloomberg) -- JPMorgan Chase & Co., Bank of America Corp. and Wells Fargo & Co. may have their credit ratings raised to the top Aaa level by Moody's Investors Service under a new system that assumes the government will bail out banks in a default, Credit Suisse Group said.

Full text at url

Copperfield: are they nuts? CreditSights thinks so:

CreditSights Ditches Moody's `Worthless' Bank Ratings
By John Glover

March 5 (Bloomberg) -- CreditSights Inc., an independent bond research firm with 700 subscribing institutions, says it stopped using European bank ratings from Moody's Investors Service because they're out of line with investor perception.

``Ratings agencies are sometimes accused of living in an ivory tower,'' CreditSights European bank analysts Simon Adamson and John Raymond wrote. ``Well, Moody's now seems to have rented the penthouse apartment there.''

Full text at url:

Rook.,.#1531553/7/07; 07:29:27!-Global-systemic-crisis-April-2007-Inflexion-point-of-the-phase-of-impact-US-economy-enters_a448.html

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

USAGOLD / Centennial Precious Metals, Inc.March Buyers' Group -- The Popular Gold German Mark#1531563/7/07; 08:24:01">gold and volatility
TownCrierSouth Africa's 2006 gold output is lowest since 1922#1531573/7/07; 09:17:49

London (Platts)--7Mar2007

South Africa's gold output fell by 7% in 2006 to the lowest level in 84 years while the 2006 fourth quarter showed a near double-digit decline when compared on-year, the Chamber of Mines said on Wednesday.

The Chamber, which counts AngloGold Ashanti, Harmony and Barrick among its members, said that total South African gold production for 2006 fell to 275,119.40 kilograms, down by 7.5% on that produced in 2005.

"This is the lowest level of gold production since the strike in 1922 reduced production to 218,031 kilograms," the Chamber said in a statement.

...the fourth quarter 2006 figures which saw South Africa's gold production fall on a year-on-year basis by 9.3% in the fourth quarter compared to the 2.9% decline recorded in the third quarter of 2006.

There was even worse news... Total production costs showed an increase, before capital expenditure, of 11.9% on a year-on-year basis to Rand 99 725/kg ($13,471/kg), with the Chamber blaming higher input costs.

Total production costs including capital expenditure rose by 20.8% to Rand 125,030/kg.

^___(from url)___^

With trends like these, who needs enemies?

When you have money for investment or savings, here again we see reasons to choose metal in hand instead of shares in companies struggling to extract a dwindling underground supply in the face of rising production costs -- to say nothing of the looming risks of national taxation or nationalization in one form or another.

Call USAGOLD-Centennial Precious Metals today to get your piece of this latest price dip while it lasts. 1-800-869-5115


Rook.,.#1531583/7/07; 09:50:31

Regrettably, I must agree with the links view.
Despite artful play acting, I also agree with conspiracy nuts who are not part of the link, but who say that global elites have a set of dominoes that they are pushing over, that will lead to a result they want. An absolutely unilateral drive to a one world structure. Order.
If they have an achilles heel, I do not see it.

Golden RatioCastles in the air#1531593/7/07; 10:08:06

"The more important Central Banks are becoming skittish about the enormous amounts of "reserves" which they are accumulating. The Central Bankers are bureaucrats, but they are sensing that these enormous holdings are rather worrisome; however they do not know what to do about them. The fact is, they have been had. Their "reserves" are simply numerical and lack any substance. They are imaginary and as useless as castles in the air, unless they can manage to get rid of them by passing them on to some unsuspecting seller of tangible goods...

It appears that they have finally realized that the reserves that are actually worth something are the gold reserves, and not the "foreign currency" bond holdings which they were so eager to hold because they "provided earnings".

However, if they start to unload their imaginary holdings, the exchange value of the holdings will begin to fall. So they are in a dilemma, a choice between two distasteful alternatives: "Shall we hold on to the imaginary money and wait and see what happens, or shall we begin to unload it and risk collapsing the value of the larger part remaining with us?"

Up till now, the Central Bankers have been doing what bureaucrats usually do when they are faced with a difficult choice: nothing. They are waiting to see what happens.

More than half of the world's Central Bank "reserves" are held by the Central Banks of China, Japan, South Korea and Southeast Asia. These Central Banks ended up with these huge "reserves" because they accepted a means of exchange - which was no more than imaginary money, digits on computer discs - as if it was payment. In other words, they believed a fairy tale, like the one where Jack trades his cow for a handful of colored beans.

So, we are living in a fairy tale world, where money is not money at all. Alas, reality cannot be fooled by means of fairy tales. How we shall fare, when the dream has vanished into thin air and the last fool has had to recognize the difference between a payment and a fairy tale?"

Methinks we at this forum shall fare well, well indeed.

TopazThe World IS flat afterall!#1531603/7/07; 12:24:48

It sure is interesting watching the various currencies as they wax and wane vis Gold.
In the period from 1/1/07 the Yen went from weakest to strongest of the bunch and now appears to be settling mid-field.
The Canuck thing is weakening as I type and will, in all probability be the first to best it's MYH this time through.

I don't think the SM rout is over and done with just yet and, given the favourable RSI on PoG, don't be too surprised to see PoG/S rise this next time.

GOLD FINGERJust another signal concerning metals....#1531613/7/07; 12:32:10

Up..up..and away..??

Just a few days ago our wondrous state legislature took it upon themselves to make it more difficult for scrap metal dealers to collect the so called "SCRAP" from a seller.

The new restrictions make it now necessary to log each transaction, details of the seller with a photo id and on large transactions they have now wait a grace period prior to being paid.

Oh, CONTROLS will make all commodities go HIGHER!!

We know what there are trying to do...don't we?

P.S. Hint: I live in a very rich mineral state


TopazCuriously,#1531623/7/07; 13:17:43

Since the Comex close today, we've been in $ freefall with concurrent strength in Bond.
No apparent SM action just yet, ...Put your helmets on ...just in case ...;-)

Federal_ReservesTrust but Verify#1531633/7/07; 14:08:16

PHILADELPHIA - An unknown number of new George Washington dollar coins were mistakenly struck without their edge inscriptions, including "In God We Trust," and are fetching around $50 apiece online.
flow5Recession#1531643/7/07; 14:10:44

GF: I agree with you on our legislators. It's just that I think Bernanke is a very smart man, i.e., despite his recent catastrophic error. There should be no recession.
TopazDaffy Daq and the red-line fever.#1531653/7/07; 14:13:16

Daffy, or for that matter his three nephews Hui-e, Dowie or SPewie, can't seem to get any traction above the water-line these days. ...Keep paddling boys!
SurvivorNew Scrap Metal Laws#1531663/7/07; 14:27:08

If things in your state are going the way of ours, new laws are needed to slow the pace stolen metal products. Thieves are stealing everything from highway guard rails to brass statues. Wire and plumbing gets stripped right out of the walls of new construction. Even 'live' wire sometimes gets liberated.

This is an self sustaining loop. Higher metal price drives demand; demand leads to theft; theft results in new laws; new laws drive up metal prices.

Just another endless cloverleaf on the inflation highway.

- Survivor

GoldiloxBernanke#1531673/7/07; 15:39:49


No doubt Choppa Ben is very smart, as was Greenspan. Neither is or will be in the position of Savior, any time soon.

Just ask Nikolai Tesla how far "smart" gets you in the cut-throat world of business and politics. He invented most of what made Westinghouse and GE the power giants they became, and his reward was "kook status" when he suggested evolving from their "fixed" media - after they cheated him out of contractual royalties.

One must play their cheaters' game, or watch the entire foundation erode beneath one's feet!

USAGOLD Daily Market ReportPage Update!#1531683/7/07; 16:07:03">
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

March 7 (DowJones) -- Gold futures on Wednesday continued their rebound from early Tuesday's decline to fresh six-week lows. Higher energy futures prices combined with a weaker US dollar to push the metal higher.

Prices closed near their daily highs Wednesday; April gold rose $6.70 to $652.90 on the Comex division of the New York Mercantile Exchange.

"Overnight, gold did perform well, despite the weakness seen in the crude oil market" during that timeframe, said Dan Vaught, futures analyst at A.G. Edwards. Then when the energy markets began to rally during the day session Wednesday, the precious metals were further boosted, he said.

Another analyst said short covering following the recent steep declines in gold and silver also has supported the markets' rebounds.

Early Tuesday, April gold dropped to a fresh six-week low of $634.50, marking a decline from last week's high of $692.50.

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

CometoseSwan Diver is back#1531693/7/07; 16:17:20

and all the HUI can do is WILT like lettuce .......

or for you ladies.......

fall like Soufle


Cometoseand the CRB today#1531703/7/07; 16:19:57

had a stunning day .......thanks to OIL which is up handsomely ..........
SOme things just never change and BS NEVER STOPS

Yes some day the BS will stop ......


MKGoldilox#1531713/7/07; 16:30:37

What you are talking about there with respect to Messrs. Bernanke and Greenspan is whether monetary policy - or perhaps central banking itself - is most successful when viewed as an art or a science. An interesting question. Bernanke, it seems, leans toward science (I am certain he is surrounded by reams of stats, charts and the like) and Greenspan (the old Greenwich Village trombone player) leans toward it being an art. It is interesting to see this new, unforeseen interplay between Bernanke and his old boss. I don't think AG liked being out of the limelight, so he's back, and his presence could be a continuing problem for Bernanke as we move along in these oddest of times.

Some interesting recent Greenspan quotes:

"I was aware of the problem that if I stayed public, I could make it difficult for Ben. For the most part it has worked. I was beginning to feel quite comfortable that I was fully back to the anonymity I was seeking.''

"I thought I had successfully moved into a state of anonymity that I cherish after being in the public domain for so long. I'm as much surprised that remarks I made supposedly affected the markets because I've been making those remarks for months and nobody noticed. I try as much as I can to avoid comments relevant to what the Fed is doing. But I have a profession and I'm a private citizen."


This morning Greenspan grabbed headlines again by stating that the yen carry trade has limited room to run, that it "has to turn around" at some point. Mark my words, it won't be long until he's talking about gold again.

TownCrierWhat was the ECB doing during last week's mini-rout in the markets?#1531723/7/07; 16:32:00

Looking at the Eurosystem's consolidated reserve movements, it was pretty-much business-as-usual.

Under the auspices of the CBGA, there was a decline in gold and gold receivables of only EUR 34 million in value (i.e., 2.2 tonnes).

Meanwhile, the Eurosystem's net position in foreign currency was off-loaded by yet another EUR 200 million.

To reemphasize a point made many times previously, gold (now 'weighing' in at EUR 176.45 billion, up from only EUR 99.6 at euro-launch) has evolved into position as the Eurosystem's primary reserve, whereas the once-dominant holdings of foreign currency have been pared by one-third of its former size to a minority position valued at only EUR 145 billion.

This evolution in the structure of reserve holdings is definitely one trend that IS your friend. You, too, can 'follow in the footsteps of giants'.


CometoseROOK / Achilles HEAL#1531733/7/07; 16:39:13

HEAL SPOT.......

UMMHHH is Human Nature .......GREED and arrogance a system that is run by men

REFERENCe to this is made in the Book of DANIEL ....

IRON mixed with Clay

Napoleon tried it
Hitler tried it ........

It's not going to happen again in the world that you and I know ........

Driving hard now toward a new world .....but NOT OF THE ORDER or DESIGN Counted on Expected or SCRipted

melda laurewhen capitalists fall from wisdom.#1531743/7/07; 17:19:49

You will note that your serbian inventor was paid mostly in bank balances and stock certificates.... That he ended up with nothing is in part due to his determination to invent, as opposed to accquire permanent wealth which he had plenty of opportunity to do.

I doubt that many whom he helped build fortunes actually shared his goals. It is one thing to build up wealth, quite another to create freedom. Two ships pass in the night and may share the same course for a time, but ultimately have their own destinies, as Galadriel might have said: much gold will pass through your hands but it will have no power over you.

Many have walked the golden road to ruin, others have walked to fortune bound with great misery.

CometoseMelda Laure#1531753/7/07; 18:00:14


Thoreauly@ MK re: Greenspan#1531763/7/07; 18:26:34

"Mark my words, it won't be long until he's talking about gold again."

No, it won't, as he will soon be giving full credence to his very unGreenspanesque candor before Congress in 1999:

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

Paper Avalanche@ Town Crier - ECB Numbers#1531773/7/07; 18:29:10

Hi TC, thanks for the regular updates on the ECB numbers. It is both intriguing and remarkable to watch gold evolve as the ultimate wealth asset / reserve vis-a-vis the paper currencies per the ECB's continual adjustments.

Is there a historical table of the ECB numbers that you report to the forum? I would be curious to chart (and track going forward) the percentage moves in the ECB numbers. I am not sure what percent of the ECB's reserves gold comprised when the MTM mechanism was first introduced and these numbers were first reported, but it would interesting to see how the overall percentage of gold as reserves for the ECB changes going forward.

FWIW, per your numbers below, the ECB's gold holdings comprise 54.89% of its reserves.

Thanks in advance,

mikal(No Subject)#1531783/7/07; 18:47:12

This article appears in the March 9, 2007 issue of Executive Intelligence Review.
London's Cayman Islands:
The Empire of the Hedge Funds
by Richard Freeman - Snippit:

On Feb. 27, the world's hedge funds, through their manipulation and miscalculation of the yen carry-trade, led to a violent unwinding of that carry-trade, which triggered disintegration of the world financial structure. Stock exchanges fell, from the Dow Jones exchange in the United States, to China's Shanghai composite index, to Brazil's Bovespa index, shedding more than $1.5 trillion in paper losses. Secondary incidents contributed to setting off the downturn. But hedge funds had already bled the major international commercial banks and corporations into absolute bankruptcy, and had leveraged borrowed funds and derivatives into the biggest financial tumor ever. That, combined with their yen carry-trade role, amplified the effect of the secondary incidents, and is now driving the financial system further into systemic breakdown.

And where are those hedge funds? Though they may have offices in locations like Greenwich, Connecticut, or New York City, 8,282 out of the total of 9,800 hedge funds operating at the end of the third quarter 2006 worldwide, were registered in the Cayman Islands, a British Overseas Territory, run like a dictatorship by a Royal Governor appointed by Queen Elizabeth II, with a total population of 57,000 people.

There is good reason for this. The Cayman Islands Monetary Authority (CIMA) is supposed to "regulate" the hedge funds, but instead runs a protection racket for their derivatives trading and tax sheltering. The CIMA gives each hedge fund, at registration, a 100-year exemption from any taxes; shelters the fund's activity behind a wall of official secrecy; allows the fund to self-regulate; and prevents other nations from regulating the funds by insisting on first and final authority in this area.

And the remainder of the world's hedge funds, not registered in the Cayman Islands? Most are registered in other British Overseas Territories and satrapies, such as the Bahamas, Bermuda, the British Virgin Islands, and the Isle of Man.

Global Financial Oligarchy's Instrument
Since mid-January, forces internationally—ranging from the Danish government, to German Vice Chancellor Franz Müntefering (who has famously labeled hedge funds "locusts"), to U.S. Sen. Carl Levin (D-Mich.)—have directed initiatives geared to regulating, and potentially bringing under control the predatory activities of the world's hedge funds. For his efforts, Müntefering was outrageously attacked on Feb. 14 by the German edition of the Financial Times, the London financier oligarchy's mouthpiece, as an "anti-Semite."

Chris PowellMartin Armstrong: The white-collar defendant time forgot#1531793/7/07; 18:53:05

8p ET Wednesday, March 7, 2007

Dear Friend of GATA and Gold:

Back in 1999, not long after GATA was founded, the first personage of the financial establishment to engage us in cordial correspondence was Martin A. Armstrong of Princeton Economics International in New Jersey. Armstrong disputed our contention that the gold market was manipulated, a contention we now consider proven by the several admissions of central bankers and other major players in the gold market since that time. But we did credit Armstrong for an insight with which we increasingly have agreed over time -- that the central banks should sell all their gold and thereby remove the overhead supply and forfeit their power of market manipulation and unleash a lasting bull market for gold. We just wanted the central bank selling and leasing to be done openly and with proper accounting so the world would understand the manipulation.

Soon after our correspondence Armstrong ran into trouble with the U.S. government. We're not in a position to judge his culpability but his long imprisonment on a count of contempt of court -- now more than seven years -- is beginning to seem tyrannical, like too many other things recently in the United States. A few weeks ago The New York Times published a story updating Armstrong's situation. Thanks to our friend Mark Webber for bringing it to our attention. It is appended.

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

* * *

In Fraud Case, 7 Years in Jail for Contempt

By Gretchen Morgenson
The New York Times
Friday, February 16, 2007

On Jan. 14, 2000, Martin A. Armstrong, a globe-trotting investment manager, was told to produce $15 million in gold and antiquities, as well as documents, in response to a civil suit by the government accusing him of securities fraud involving hundreds of millions of dollars.

When he said that he did not have the items and could not produce them, a federal judge ordered him jailed for contempt of court.

Seven years later, Mr. Armstrong sits in the Metropolitan Correctional Center in Lower Manhattan.

Imprisoned two years before Enron and WorldCom brought corporate crime to center stage, Mr. Armstrong, 57, is the white-collar defendant time forgot. Over the years, the losses of his former clients have been repaid by a bank involved in his trades.

Still, he remains jailed on one of the longest-running charges of contempt. In many cases, a federal law limits to 18 months how long someone can be held under civil contempt while the court tries to coerce compliance with an order. Even in cases of criminal contempt, whose goal is punishment rather than coercion, an individual is entitled to the full protections of due process after six months.

"A legal proceeding is supposed to be the quest for truth," Mr. Armstrong said in a phone interview last week from the 12-story building, which is used mostly as a temporary holding site for prisoners. "But this contempt was used to stop me from going to trial, and it's been nothing but bad faith from the government ever since."

How Mr. Armstrong has been held for so many years without a trial is a tangled and bizarre tale. Mr. Armstrong, his lawyers say, has been stuck in a surreal situation in which criminal prosecutors have never had to prove their 24-count indictment at trial while the civil case tied him up. Nevertheless, they have gotten their desired result -- a lengthy prison term for Mr. Armstrong.

Last August, he pleaded guilty to one count of conspiracy in the criminal case. He struck that deal with federal prosecutors after he was moved from the 75-square-foot cell he shared with another prisoner into solitary confinement and had not slept for days, his lawyer said. Over the years, prosecutors have said that they were ready to proceed to trial and that civil contempt had nothing to do with their case. Mr. Armstrong countered that his detainment impeded his efforts to mount a proper defense, blocking his access to essential documents and computers as well as the assets to pay counsel.

Because there has been no jury trial in the case, it is impossible to say which side is right: the government, whose indictment in September 1999 contended that Mr. Armstrong misappropriated hundreds of millions in client funds; or Mr. Armstrong, who said that officials at the bank executing his trades generated temporary losses that could have been recovered in the market. (Two of those officials later pleaded guilty to fraud in a related case involving the bank.)

But this much is certain: Mr. Armstrong's years in jail for civil contempt will soon exceed the sentence of 6.5 to 8 years that he would have received if he had been convicted of all 24 criminal counts of securities fraud, commodities fraud, and wire fraud.

"The case sends a very bad signal," said Bernard V. Kleinman, a criminal lawyer in White Plains who represented Mr. Armstrong until 2004 and argued twice for his release before the U.S. Court of Appeals for the 2nd Circuit, in Lower Manhattan. "I think it bodes very ill for anybody held in civil contempt. District court judges can look at this case and feel that the likelihood of the circuit reversing them is small and that time is, in and of itself, no factor in determining whether civil contempt has lost its coercive effect and has become punitive."

John F. Keenan, the federal district court judge overseeing the criminal case, has not yet sentenced Mr. Armstrong. It is unclear whether the judge will give Mr. Armstrong credit for the time he has served. Under federal sentencing guidelines, his lawyers expect a sentence of about five years.

A spokeswoman for the U.S. attorney in Manhattan said the office did not comment on open cases.

Judge Richard Owen, the senior district judge who ordered Mr. Armstrong held in contempt, still sits on the bench in the Southern District of New York, where he has been for 34 years. When he ordered Mr. Armstrong taken away by federal marshals, he declared, "Mr. Armstrong has the keys to the jail cell in his pocket by production and telling people where to go to get it and dig it up and turn it over."

Over the years, Judge Owen would revisit the contempt order every 18 months, guided by the federal statute. He repeatedly said that Mr. Armstrong was motivated by greed and was awaiting his release from jail to retrieve the $15 million that the government said was missing. According to lawyers who worked on the case in the early days, the financier's headstrong manner irritated Judge Owen almost immediately.

But Judge Owen was moved off the case in November by a panel in the 2nd Circuit Court hearing Mr. Armstrong's third appeal on the contempt charge.

The three judges unanimously rejected the appeal to free Mr. Armstrong but found that on the seventh anniversary of his confinement, "his case deserves a fresh look by a different pair of eyes."

It was the second time in less than a year that the Second Circuit had ordered Judge Owen replaced on a high-profile case. In March a panel overturned the 2004 conviction of Frank P. Quattrone, the former investment banker at Credit Suisse, because Judge Owen failed to instruct the jury properly; the panel assigned the case to a new judge in the "interest of justice." Later the government decided not to retry Mr. Quattrone.

Judge P. Kevin Castel has taken over the Armstrong civil case. A hearing is scheduled on the contempt matter for March 15. A request to interview Mr. Armstrong in person was denied by corrections officials, and Judge Owen did not return a call seeking comment.

At the peak of his career in the mid-90s, Mr. Armstrong oversaw $3 billion in client assets. He was widely quoted in the financial news media, including The New York Times, on interest rate and currency movements. He began working at a coin and stamp dealership when he was 13 and opened a collectors' store when he was 21. He founded Princeton Economics International, based in Princeton, N.J., in 1981.

Mr. Armstrong, an intelligent and imperious man who claimed to have made his first million by age 15, seems to have begun having trouble in 1999 when trading losses turned up in accounts that were held for the firm at Republic Bank. The problems appeared as the HSBC Group conducted a financial review before acquiring Republic.

The government said that Mr. Armstrong had improperly commingled accounts and overstated the value of the account's securities in client statements.

Mr. Armstrong said that he did not authorize the transactions that produced losses and that he was not involved with commingling of the accounts. He was indicted in September and released on $5 million bond.

In January 2000 the receiver appointed by the court in the civil case said that Mr. Armstrong had purchased gold coins and other assets with his firm's money. His lawyers argued that the assets might have been purchased before the suspected wrongdoing.

When Judge Owen ordered the assets returned, Mr. Armstrong delivered four of the five computers sought, eight of the 11 requested boxes of documents, and gold coins worth $1.1 million. He said that was all he had. The receiver said assets worth about $15 million were missing. Mr. Armstrong's odyssey in the judicial system began.

His assets frozen, Mr. Armstrong has been unable to pay lawyers. He now relies upon David Cooper and Steven Z. Legon, two lawyers from the Criminal Justice Act panel, set up to help indigent defendants, and Thomas V. Sjoblom, a lawyer at Proskauer Rose, who has received nominal compensation.

"On what grounds can you tie up the system of criminal procedure and civil procedure and hold everything in abeyance during contempt?" Mr. Sjoblom asked. "What about your speedy trial rights? What about the government's need to move forward in the civil case? You're using the contempt process to wring a settlement or a plea out of the person. That, to me, is abuse of the process."

Over the years, more than half a dozen government lawyers have cycled through the case. In 2003, Mr. Armstrong changed his legal approach in challenging the contempt charge, saying that he did not have to produce the assets and citing his Fifth Amendment right.

The receiver, meanwhile, has recovered the vast majority of money said to have been lost by investors in the case. In January 2002, Republic New York Securities, a brokerage firm that housed Princeton Economics' accounts, pleaded guilty to conspiracy and securities fraud charges. Republic Bank paid $606 million to victims, all Japanese companies. It was "full restitution," the assistant United States attorney said at the time.

Alan M. Cohen, then a lawyer at O'Melveny & Myers and now executive vice president and global head of compliance at Goldman Sachs, is the court-appointed receiver.

His former colleague, Tancred V. Schiavoni, a lawyer at O'Melveny, said that all the victims had been satisfied. "We tried to do the right thing, and we've gotten nothing but grief," he said. "What this guy wants is to be given credit for time served on the contempt and leave with the money."

O'Melveny & Myers has received at least $3.9 million to cover its fees and disbursement over the years, according to court filings.

The discovery process was protracted partly because of the complexity -- hundreds of boxes of materials had to be examined and data transcribed into digital format -- and because Mr. Armstrong was in jail and relying on lawyers working pro bono.

In January 2006, criminal prosecutors said they were eager to put Mr. Armstrong on trial in October. Then in early August, federal prosecutors appeared at the correctional center to strike a plea deal. The visit, Mr. Sjoblom said, came a week after Mr. Armstrong had been ordered into solitary confinement -- known as "the hole" -- for damaging a vent in a common area.

Mr. Armstrong pleaded guilty to one count of conspiracy to commit securities fraud for failing to keep his investors informed about losses and for agreeing to make investor funds available to Republic to cover Princeton Economics' unrelated trading losses.

"I think the government just wore Marty out," Mr. Sjoblom said.

On Dec. 7, Stephen J. Obie, regional counsel for the Commodity Futures Trading Commission, visited Mr. Armstrong with a settlement offer in which he would sign over some $30 million as a penalty. Mr. Armstrong declined.

The Securities and Exchange Commission and the CFTC declined to comment on the case.

The government has said that $21 million is still owed. Even if that must be paid by Mr. Armstrong's firm and not Republic Bank, an estimated $40 million is left in what was once Princeton Economics: $30 million in the United States and $10 million in a British entity. Mr. Armstrong and his lawyers learned of the $10 million three weeks ago.

Mr. Armstrong, who is divorced, has two children and an elderly mother who await his release. His daughter, Victoria Armstrong, 30, visits most Wednesdays, spending about one hour with him in a common room with other visitors and prisoners.

"You never stop thinking about where he is and what he goes through," Ms. Armstrong said in an interview last week.

Her brother, Martin, 31, said he was bewildered at what he sees as the breakdown of due process in his father's case. "That you can keep someone in contempt for such a long time with so many unanswered questions -- that part of it has been a real eye-opener," he said.

Sonia Sotomayor, a judge on the 2nd Circuit panel that heard Mr. Armstrong's appeal last year, seemed to echo this point. "The district court's finding that Armstrong is motivated solely by greed is not enough to justify disregard for due process," she wrote. "Courts must exercise caution in their use of the contempt power and must recognize when it has reached the limits of its utility."

Rook.,.#1531803/7/07; 20:05:40

Thankx fer respondin Cometose.
Have you seen this link?

Rook.,.#1531813/7/07; 20:24:34

Cometose, if you scroll down to bottom, hit button, goes to where I meant to link.
TownCrierPaper Avalanche,#1531823/7/07; 21:16:42

I'm pleased to learn that there's someone else (beside just me) who's gaining some insight from this particular ritual of observing the evolution of the Eurosystem's reserve architecture.

To answer one of your questions, when the EMI transitioned into the ECB, on euro-launch day -- January 1, 1999 -- the Eurosystem's gold holdings (EUR 99.5 billion) represented only a slim third (30%) of total reserves. At that time, the net position in foreign currency was EUR 227.4 billion, making up 70% of their total Int'l reserves.

From my other post today, it is truly warranted to say, "My, look how far they've come," -- gold holdings now represent 55% of total reserves.

Structurally, the consequences of the monetary union created a unique circumstance regarding an opportunity of "excess" reserves among its member states, but the lesson remains valid regarding the shift in proportions of their holdings.

Now, can anyone imagine China beginning to follow in those giant footsteps? In the course of that affair, you can be sure that China won't be a CBGA-style gold distributor, but rather an accumulator.

Subsequently (these years following the euro-launch), even within the U.S.-dominated IMF we now see the majority of its participants following this European-style MTM accounting as the new standard in best practice. It's only a matter of time before the U.S. Govt, too, grudgingly but necessarily travels that golden trail.

To address your other question, no, I don't have a continuous table or chart of the evolution in Eurosystem reserves. I only have a handy set of periodic and notable benchmarks along the way. Having a continuous chart to show off would probably be a very useful instructional tool. I'll look into assembling one when time allows -- probably not until later this summer.

Thanks for the feedback.


SundeckGreenspan and gold#1531833/7/07; 21:53:28

Mmmm....I'm well behind in my reading of The Forum, but noting Greenspan's "casual" remarks of late (about recessions and yen carry trades and the like) made me wonder what the consequences would be if the dear man were to make a few "casual" (positive) remarks about gold...

I wonder what his "release agreement" entailed when he left The Establishment?

I wonder if he is on a retainer with any particular lobby groups??

Just thinkin...


GoldiloxChina#1531843/7/07; 22:55:59

@ TC,

"Now, can anyone imagine China beginning to follow in those giant footsteps? In the course of that affair, you can be sure that China won't be a CBGA-style gold distributor, but rather an accumulator."

Not that I am specifically contradicting your guess, but watching China, one thing that stands out is NO ONE REALLY KNOWS what they are planning, and they seem to like it that way.

TownCrierGoldilox, on China#1531853/7/07; 23:22:18

Politically speaking, a shroud of mystery or uncertainty certainly has its advantages.

But on the point of gold, did you see the notice given three weeks ago by its appropriate agency that China expects to develop something on the order of 1500 tonnes domestic reserves of gold by the year 2010?

It surely gives one reason to ponder why they felt a desire to divulge such info... and WHY THIS (odd???) TIMEFRAME?

I seem to recall a rather handsome fella speaking of 2010 as a political convergence point for gold's bright future. Was China signalling acquiescence with such a timeframe? They've certainly taken the schedule of liberalization of their gold market as a political priority during this decade for SOME reason or Another.


GOLD FINGERThe china Factor#1531863/7/07; 23:32:38

I think China is not as stealthy as everyone thinks.
They are building a massive army and from what
I gather our satellites are tracking many of their

What do they have to hide that we don't already know?

We will be in a dance with them for many more moons!


GoldiloxChina#1531873/7/07; 23:49:53


Again, I'm not quibbling with your reading of their "announcements", but others have noticed the Chinese are famous for announcing one intention on Monday, followed by a contrary one by a completely different source on Tuesday. They seem to have more than ample bureaucrats to match their gargantuan population, so there are innummerable "agencies" that may from the outside seem to overlap in jurisdiction.

Just the sort of hierarchy to embellish their "shroud of mystery".

TownCrierPost analysis#1531883/8/07; 02:47:54

My great gold-minded friend, G, asked me if I would care to help him out with an assessment of OvS's intriguing post about "Trust, etc." -- msg# 153145.

It began...

OvS (3/6/07; 16:36:24MT - msg#: 153145)
Trust, ect.
Why do foreigners invest in the
US stockmarket and trillions into
the US bond and treasury markets?
Are they really stupid? No, they
are clever and sharp like rasor-
The simple answer is:
They want to sell 10 billion of
whatever, or buy, the US market
will accomodate them. LIquidity!!
When you think about it: liquidity
equals to trust and confidence.
Let's say you are a successful
Chinese. Would you rather trust the
Japanese markets or Europeans, or
the US markets? When it comes to
the really big deals, there is no
equal to the United States Market.
All these Arab trillion, made with
oil revenues. Where do they wind up?
In Manhattan and London. Who else
can you trust with billions?
. . .(continued)
---[see url for the full post]---

Upon getting my response, my friend requested that I post it, thinking it might be of benefit to a few others. Therefore, here is my (windy) critique -- the response to his emailed inquiry.

> Any thoughts on OVS mes # 153145 ?
...First of all, let me say I'm glad you took specific notice of it
and have called attention to it for full scrutiny.

OvS makes a very good point where he says up front,

When you think about it: liquidity
equals to trust and confidence."

It sounds good on the surface, but an astute thinker will recognize
that there is more here than meets the eye.

Simple equality implies that both sides of the equation are simply equal,
and that further details are unnecessary.

Consider, 2 plus 3 equals 1 plus 4...

2+3 = 1+4

It would be just as valid to reverse order and say

1 plus 4 equals 2 plus 3...

1+4 = 2+3

It goes without saying that either half could be scrutinized as follows...

2+3 = 5
1+4 = 5

That order makes a natural presentation. However, you will note that even
though we are dealing in equivalency, it nonetheless seems a bit queer to
change the order and say it as follows...

Five equals two plus three
5 = 2+3.

Perhaps it seems odd in that order because it is sounds too definitive -- as
though it were the all- inclusive situation. However, we inherently know that
it isn't. We know as we read it that it could have been stated alternatively
with matching validity...

Five equals 1+4.

The essential point here boils down to Cause and Effect.

2+3 can be the Cause of the singular Effect we know as 5.

1+4 can Cause the singular Effect we know as 5.

In these examples of equality, we recognize that there tends to be
a natural assignment of Causes and Effects, each to its respective side.

That is to say, even though it is mathematically acceptible, it is not quite
natural to portray the reverse ordering

5 = 2+3

because it implies that, if we make a simple initial observation that "five" exists,
that it is a Cause of a predictable, singular Effect. But we know it isn't.

Thus, it is best to say it (and to order it) as so...

2+3 >> 5

Whereby my >> symbolism implyies that there is a (directional) natural progress
of Cause and Effect in the particular type of equivalency that is being scrutinized.

From the lesson above, OvS's opening statement would therefore be more
intuitively arranged if it were presented as the following equation.

trust and confidence >> liquidity!!

That progession of T+C giving rise to Liquidity should sit most naturally in our mind.

OvS does eventually make this subtle but very important point, although it
isn't completely made until the latter portion of his post. He says, astutely:

"So what's the problem?
Well, liquidity and trust and confidence
only go so far. When liquidity (injec-
tions of the Federal Reserve) is used
to CREATE trust and confidence, then
watch out..."

Interestingly, he goes on to say,

"There is a fine point in
balancing these entities and that balancing
act I leave to more accomplished jogleurs
and hope for the best."

So, I hope I've successfully juggled some good sense into a helpful
interpretation of his words.

All this is to say, the U.S. (with the Fed as its monetary agent) has been
benefiting by playing on the world's sloppy sense of equivalency regarding
Liquidity and Trust+Confidence vis-a-vis Cause and Effect.

Just as the world can, for a period, be inclined to believe strongly that, given FIVE,
it naturally follows that TWO+THREE is present.

OR, perhaps the world tends to believe almost as strongly that given FIVE,
it follows that ONE+FOUR is present.

We, however, are clever enough to know that an equally valid (but considerably
less popular) worldly interpretation could be, given FIVE,
the other side can simply be FIVE+ZERO.

Do you get the important difference?

We SHOULD say, with the PROPER ordering of Cause and Effect, that
Trust plus Confidence give us Liquidity as the payoff.

Trust + Confidence >> Liquidity.

However, by focusing on liquidty, the U.S. Fed is TRYING to turn around this
directional equivalency -- to engender a popular interpretation that Trust and Confidence follow as an effect. Presented graphically...

Liquidity >> Trust + Confidence.

What does this all mean? The appropriate word of caution in this backwards
focus should now be readily accessible. In the good company of our deeper
thinkers, we are keenly aware that Another very valid outcome of this
backwards presentation of liquidity as the given (i.e. as the Cause) could
certainly be this following sad hyperinflationary conclusion (Effect):

Liquidity >> Liquidity + ZERO

In other words, as the focus, a provision of liquidity can, in the extremis, be
liquidity and nothing else;
such as piles of cash (or accounts loaded with digits) having NO VALUE in trade.

Was this useful?


mikal@Sundeck#1531893/8/07; 02:49:05

Good question. The syndicate.
FreedomThe Analysis #1531903/8/07; 05:47:40

Randy, you're a genius. The simplicity of your reasoning can be applied to EXPLAIN some things I considered illogical. Sincerely, Thank You.
Lackluster.#1531913/8/07; 05:57:29

Hey, let's keep it simple.

Here is a quick vid on economic principles.

CometoseRandy ; Liquidity trust and confidence#1531923/8/07; 06:18:17


Simple ........and Lying there right underneath our noses
in the state of illusion /delusion


DruidTownCrier (3/8/07; 02:47:54MT - msg#: 153188)#1531933/8/07; 07:52:04

Druid: TC, homerun that cleared the stadium. I nominate this one for HOF status. Thanks.
USAGOLD / Centennial Precious Metals, Inc.An over-the-shoulder look (via inflation-adjusted prices) revealing some of the liquidity that's been (so far) 'successfully' pumped into our system#1531953/8/07; 08:20:21">gold price potential
flow5Foreign Exchange Value of the Dollar#1531963/8/07; 10:22:01

If the volume of demand for U.S. dollar denominated investments increases sharply while interest rates are falling in the U.S. and rising abroad, it cannot be explained in terms of nominal returns. What seems to be reflected here is a "risk-adjusted" return. In other words, the U.S. has become increasingly the world's "safe haven" for investments, made even more attractive by the depth and freedom of our markets.
SmeagolTownCrier (3/8/07; 02:47:54MT - msg#: 153188)#1531973/8/07; 11:11:33

We seconds! Thank you for that illuminating insight. ~8-)
CoBra(too)Safe Haven @ flow 5#1531983/8/07; 11:19:34

You've postulated:

"Foreign Exchange Value of the Dollar
If the volume of demand for U.S. dollar denominated investments increases sharply while interest rates are falling in the U.S. and rising abroad, it cannot be explained in terms of nominal returns. What seems to be reflected here is a "risk-adjusted" return. In other words, the U.S. has become increasingly the world's "safe haven" for investments, made even more attractive by the depth and freedom of our markets".

I'm really in total disagreement with your statement; After all the US $ has lost about 30 - 40% in value vs some harder currencies in this scheme of a free floating currency regime, backed by nothing as promises to pay back... what?! The lender of the last resort used to be the IMF and its SDR's, which seem out of fashion, or altogether defunct. The purchasing power of all currencies and in particular the US Dollar has even surpassed its fall vis a vis other currencies.

What I see here is a mad scramble for liquidity to bail out underwater financial assets such as margin positions, hedges or plain buy the dips mantra.

No, Sir, IMHO this is just a dead cat bounce in the safe haven of attractive by the depth and freedom of the $- markets - well, maybe you've been meaning this ironically and in this case I rather not be tempted to even grin.

I guess - and I won't say again the time is near to repent as to redempt is only past tense from here on - so, the time of the pm complex to seperate smartly from all financial safe havens to the real safe haven of pm's is close - we only have to work off the few decades old mantra of the Dollar and floating rate delusion of debt backed paper and the need for constant growth within a finite world.

Someone a lot smarter than I said - as a holder of physical gold you'll only perish in the second row; It was by no means my friend OvS, who probably seduced Mr. Straus to over-interpret his latest missives.

Be that as it may - It's only over when it's over - and we're still in a young gold bull; Some fireworks may be seen even before summer, though probably not the last.

Cheers cb2

968Ben S Bernanke: GSE portfolios, systemic risk, and affordable housing#1531993/8/07; 13:01:24

Remarks by Mr Ben S Bernanke, Chairman of the Board of Governors of the US Federal Reserve System, before the Independent Community Bankers of America's Annual Convention and Techworld, Honolulu, Hawaii (via satellite), 6 March 2007.


"This line of business has raised public concern because its fundamental source of profitability is the widespread perception by investors that the U.S. government would not allow a GSE to fail, notwithstanding the fact that – as numerous government officials have asserted – the government has given no such guarantees. The perception of government backing allows Fannie and Freddie to borrow in open capital markets at an interest rate only slightly above that paid by the U.S. Treasury and below that paid by other private participants in mortgage markets. By borrowing at this preferential rate and purchasing assets (including MBS) that pay returns considerably greater than the Treasury rate, the GSEs can enjoy profits of an effectively unlimited scale. Consequently, the GSEs’ ability to borrow at a preferential rate provides them with strong incentives both to expand the range of assets that they acquire and to increase the size of their portfolios to the greatest extent possible."

"From the end of 1990 until the end of 2003, the combined portfolios of Fannie Mae and Freddie Mac grew more than tenfold, from $135 billion to $1.56 trillion, and the share they hold of outstanding residential mortgages increased from less than 5 percent to more than 20 percent.5 Moreover, to finance their own holdings of MBS and other assets, in 2005 the two GSEs together issued almost $3 trillion in debt. Today, the two companies have $5.2 trillion of debt and MBS obligations outstanding, exceeding the $4.9 trillion of publicly held debt of the U.S. government (Lockhart, 2007). The activities of the GSEs are not confined to debt markets; because the GSEs engage in extensive hedging activities, these companies are among the most active users of derivative instruments. Thus, by any measure, the GSEs have a significant presence in U.S. financial markets."

See URL for full text...

Gandalf the WhiteWE agreessss, two!!! -- <;-)#1532003/8/07; 14:17:58

Smeagol (3/8/07; 11:11:33MT - msg#: 153197)
TownCrier (3/8/07; 02:47:54MT - msg#: 153188)
We seconds! Thank you for that illuminating insight. ~8-)
The Hobbits "thirds" !
Go to the FORUM HOF, without passing GO !

flow5Forecast#1532013/8/07; 15:12:45

90.9 -0.36 -0.17
95.5 0.03 -0.01
95.5 0.07 0.04
95.5 0.17 0.00
95.5 0.08 0.00
95.5 0.25 0.03
97.4 0.38 0.00
96.5 0.08 0.03
97.0 -0.06 0.00
97.4 0.65 0.00
101.5 0.60 0.00

The table represents the volume of legal reserves required to sustain real gdp at c. 2% without inflation. A lower volume of reserves will result in declining rates of inflation and slower roc's of real gdp; higher roc's will produce increasing rates of both real gdp and inflation.

Aggregate monetary demand is measured by monetary flows (MVt), not nominal GDP.

The source of our means-of-payment money is legal reserves.

All of the variables needed to estimate the "multiplier" (the ratio of a given injection of new reserves into the member banks relative to the expansion of money) are well known and can be estimated with sufficient accuracy. These include: the ratio of currency held by the non-bank public to their holdings of transaction deposits, and the reserve ratios applicable to various classes of deposits within each size group.

1) 30 year mortgages

2) Trade weighted exchange rate – Broad

3) Trade weighted exchange rate – Major Trading Partners

mikalLooking ahead of the Fed#1532023/8/07; 15:43:56

Economists warn Fed on inflation expectations
To judge if their policies are working, central banks often rely too much on inflation expectations, according to a paper.
March 8 2007: 4:52 PM EST
WASHINGTON (Reuters) -- Several economists warn the Federal Reserve and other central banks in a paper released Thursday against relying too much on inflation expectations to assess whether their policies are indeed keeping prices stable.

"Our data findings serve as something of a cautionary note for policy-makers against excessive reliance on measures of inflation expectations as indicators of policy effectiveness," wrote the economists in a paper on the inflation process to be presented at a conference Friday.

Some policy-makers focus intensively on inflation expectations as the primary determinant of inflation itself, the economists said.
"Our results suggest that this practice is misguided," the study's authors wrote.

The authors of the paper, "Understanding the Evolving Inflation Process," are Stephen Cecchetti, Peter Hooper, Bruce Kasman, Kermit Schoenholtz and Mark Watson.

Fed officials often cite the importance of keeping inflation expectations low as way to keep inflation itself under control. If inflation remains too high for too long, businesses and consumers begin to make future plans for spending and investing on the expectation that prices will rise by a certain amount, leading to inflationary pressures.
In the current situation, Fed officials are worried about higher than desirable core inflation levels but cite low inflation expectations as grounds for optimism that core inflation will recede.

"A further gradual decline [in core inflation] was seen as the most likely outcome, fostered in part by the continued stability of inflation expectations," minutes of the Fed's Jan. 30-31 meeting said.

The study says none of the various measures of inflation expectations appear to have been able to forecast U.S. core inflation in recent years."
Mikal-- Looking ahead, the vested Fed may wed a gold-plated bed, or in their stead a nested BIS dread or arrested.
Greenie plead, "I am well-bred, don't turn red- the dollar bled, we are well-rested".

USAGOLD Daily Market ReportPage Update!#1532033/8/07; 16:42:21">
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

March 8 (MarketWatch) -- Gold futures climbed for a third-straight session to end Thursday at their strongest level in a week, supported by a solid performance on international stock markets and strength on Wall Street.

"We received our expected bounce/reversal and that was the easy short-term call," said Peter Spina, chief investment strategist at "Now we will watch in the coming sessions if these gains can extend." He said he believes "this momentum will continue to take us back to the upper $600s." But for now, "a move past $655 is the first step before moving back up to the $675 resistance area."

Friday's "economic reports may be the catalyst to help gold move past this initial $655 resistance," said Spina. Economic data due Friday include U.S. trade deficit numbers, non-farm payrolls and the unemployment rate for February.

"The next trading day looks favorable for gold, good bid support below at this time. An upward bias is seen even with a bit of jitteriness lingering from the recent sell-off," he said.

The COMEX April gold contract closed up $2.60 at $655.50. It's now gained $16.30 during a three-session climb, which followed a five-session losing streak that drew down prices by more than $50.

On the currency markets, the dollar rose against major counterparts, putting some pressure on April gold, which touched a low of $652 during Thursday's trading session. The euro fell against the dollar after the European Central Bank raised its key interest rate by a quarter-percentage point to 3.75%.

"Sentiment has improved dramatically across the metals spectrum in the past 24 hours through a combination of fundamentals and external factors such as the dollar and oil," said James Moore, an analyst at TheBullionDesk.

Still, "overall, the next few days are likely to be nervous as the [metals] market digests why the recent sell-off rippled through so many markets and what it was telling us," said William Adams, an analyst at

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

CometoseCrime rate up all over the nation #1532043/8/07; 17:58:15

Violent Crime across the nation is UP ......


It indicates that there is nowhere near enough education

on PLANNING (short and longterm)


Multi dimensional approaches toward financial independence

Foundational survival skills .....

Goal Setting

and the act of focusing on Believing Images of victory.....

Proactive Thinking

It also indicates that the leaders in charge of compiling and reporting ECONOMIC NUMBERS ............


The HoopleCometose#1532053/8/07; 19:05:16

Dead on about soaring crime rates as proof of a declining economy. Another obvious dot mainstream media can't seem to ever connect.

The ficticious government numbers on the economy are skewed in SO many ways. Of the many is how as income disparity grows, 1 yacht that sells for 150 million can mask the general decline of an entire city, yet it's all GDP to beancounter eyes. I assume too for CPI purposes that yacht is hedonically deflated to reflect quality improvements. It was actually 200 million before hedonics, vs. 145 million a year ago. Voila! we have both a strong economy and low inflation at the same time. It's all a big steaming load.

msiwantitallGold Hitting Mainstream Media in a BIG way:#1532063/8/07; 21:09:10

Topaz, Silver Fox, Thoreauly, etal:

I'm glad you found the video/slide presentation ( interesting and successful in raising some real concerns -- I actually found it so much as the straw-that-broke-the-camel's-back to make me liquidate half my holdings in the stock market.

This little video, although nowhere near as terrifying, is by its sheer existence telling us that the need for security that gold provides is permeating the mainstream (this is the third clip I've seen on gold on this site in two weeks). Do note the political innuendos:

Rook.,.#1532073/8/07; 21:24:41

Thanks Randy, today I heard that china invested(?) 200 billion in fannie and freddie, and THAT was where the money came from to loan to all the marginal home buyers.
The loans that will be first perhaps to flounder in a downturn.

GoldiloxLies, Damn lies, and statistics#1532083/8/07; 21:39:10

@ Comatose, the Hoople,

It's business as usual.

A CEO gets a multi-million dollar bonus for kicking 1000 workers to the street and demanding 60 hr weeks of his remaining workers, who must give up the vacation and health care benefits promised when they were hired. Despite his public self-effacing remarks, does he really care? Certainly not enough to pledge the bonus he got for sacking them to their welfare, nor enough to put his golden parachute on the line.

Banks create a zillion ways for people who can barely afford to live to mortgage their future, skimming hefty loan origination fees off the proceeds of the loan. Then they entice customers to borrow once again to get "caught up", jumping their rates to astronomical levels as "Credit risks". Risk? HAHA. The loan was generated from fractional reserve thin-air, and between the origination fees and the astronomical rates, it gets paid off three or four times. Poor, indigent banksters!

Captive utility customers see their rates double and triple to support "deregulation", only to find out it winds up in some ENRON political slush fund in a Caribbean Bankster haven. When word gets out, the "big cheeze" is "suicided" prior to sentencing, because he spent a few too many days visiting the White House while his company was bilking the public.

MNF viewers give $400M to "Katrina Relief" supported by their gridiron heroes and marketed by two ex-presidents, but not a penny went to any "victims". It is being earmarked to rebuild New Orleans for some politically-connected developers.

Gold is confiscated and forbidden to the American people for 40 years, because bankster "speculation" and margin debt has gambled away their savings. Then laws are passed so their own taxes must be used to bail the gamblers out and replace their losses in future scandals.

The Maine, the Lusitania, Pearl Harbor, and Gulf of Tonkin "intelligence" is hidden from the public and they are fed "rah rah" ideological horse hooey to get them aroused enough to use their children as human sacrifice to the gods of commerce, who are so greedy they must always challenge each other for control of more wealth than any human could ever spend. The modern world has elevated human sacrifice to assembly line proportions.

Yep, in the immortal word of Dubya's daddy, when describing the CIA planned and executed wholesale slaughter of 100,000 non-Europeans in South America with more than a third-grade education "on his watch",

"it's business as usual!"

Free markets? Ha! Name one!

OvSSee Bee Too!!!#1532093/8/07; 21:49:01

OvS seduces Mr.Straus.
If it weren't so funny
I'd be outraged.
Still laughing.

I always knew that Straus
either is/was a talmudic
scholar or a jesuitic mind
or a grammar school math
teacher. But what the hell.
As long as he loves gold,
all is forgiven. OvS

GonlyoldChina Taxing US Businesses in Their Country#1532103/8/07; 22:28:45

If I understand this correctly, China announced today that they will be taxing US businesses in their country in order to prop up their value losses in the dollar. Sorry no URL. Maybe some of you people can research this. Just a heads up.
GoldiloxChina plans business tax shake-up#1532113/8/07; 23:08:49

@ Gonlyold,

Is this what you are referring to?


Many foreign firms investing in China are to lose tax benefits they have over domestic firms as a result of reforms proposed by the government.
Tax paid by foreign and domestic firms will be unified at 25% under the plans.

China has also unveiled a series of tax breaks to promote high-technology business, energy saving and environmental protection.

It came as the US treasury secretary urged China to open its financial markets faster to boost the economy.

'Diverse economy'

On a visit to Shanghai, Henry Paulson said that open markets were the best way to ensure prosperity.

"The risks for China are greater in moving too slowly than in moving too quickly towards transparent, liquid, stable markets," he said.

He urged China to move away from low-cost manufacturing, which has caused major environmental damage.

"Your long-term economic strength requires a diverse economy with high value-added manufacturing and world-class services, including financial services," Mr Paulson said.

Domestic firms currently pay income tax of 33%, while foreign-funded businesses pay between 15% and 24%.

Under the reforms, China's finance ministry expects domestic forms will pay a total of 134bn yuan ($17.1bn; £9bn) less in tax, while the overall bill for foreign firms' tax bills will rise by 41bn yuan.

A controversial 50% tax break for foreign firms that focus on exports - which the US had said was anti-competitive - will be scrapped.

High-technology firms will be taxed at 15% under the reforms, which are set to be approved later this month.

"The reform of unifying the two income tax laws will not only promote improvements in China's economic structure and upgrading of is industries but help create a legal environment conducive to fair competition," said Finance Minister Jin Renqing.


However, analysts did not expect an eradication of the preferential tax regime to deter foreign investment into China.

"A lot of foreign companies no longer regard these kind of so-called tax incentives as a major driving mechanism for them to continue to invest in China and work in China," said Edward Tse of consultants Booz Allen Hamilton.

The Chinese government's tax revenues jumped 22% in 2006, official figures show. In addition to the fast-growing economy, China's tax revenues have been boosted by increased efforts to collect taxes from private businesses.

GoldiloxPlant Power#1532123/8/07; 23:26:00


According to a former Brazilian ambassador in Washington, Rubens Barbosa, the tour is a belated attempt by Mr Bush to regain ground lost to Mr Chavez as a result of the US administration's neglect of Latin America.

Sugarcane-derived ethanol provides 45% of Brazil's transport fuel

In the case of Brazil, Mr Barbosa says that while co-operation between the world's two largest ethanol producers is welcome, the real benefits will come only when the US lifts its steep tariffs on imports of biofuels.

"This is a limited proposition, because as far as Brazil is concerned, what matters is the reduction of the restrictions, the protectionist attitude that the US has towards ethanol," he told BBC News.

"The duties that the US imposes on ethanol is nearly equal to the price of production, yet Brazil is so competitive that we are exporting directly to the United States, despite the duty.

"To say in advance that this issue is not on the table shows how this matter is being dealt with by the administration, only in the area that is of US interest."

The big sugarcane growers of Brazil, who already supply some 45% of vehicle fuel in the country, have welcomed the initiative to expand the ethanol market in the Americas, but also argue that the US import tariffs make no sense.

Bioethanol is big business in Brazil

Alfred Szwarc of the Sao Paulo sugar growers' association (UNICA) says the current US trade position penalises renewable fuels while rewarding fossil fuels. It should, he said, be the other way around.

He believes that while tariffs are not on the official agenda of the presidential visit, moves are afoot in the US Congress that could eventually reduce or end the protectionist policies on biofuels.


While Dubya trumpets his trip to Brazil as a "victory" for biofuel, the Brazilians remind him that the US taxes the snot out of biofuel imports to "protect" his oil czar "friends and family".

GoldiloxBillionaire club membership jumps#1532133/8/07; 23:32:41


Membership of the world's billionaire club has swelled to almost 1,000, while members' net worth has risen by 35% on last year, according to Forbes.
A record 946 billionaires - worth a total of $3.5 trillion (£1.82 trillion) - now exist, up from 793 last year.

Microsoft founder Bill Gates held the top spot for the 13th year in a row with a net worth of $56bn.

Forbes put the increase in wealth down to surging commodity prices, real estate and strong equity markets.

"In the last five years... despite all the turmoil in the world, all the conflict in the world, the global economy in real terms expanded over 25%," said Steve Forbes, the magazine's editor-in-chief.

"Never in history has there been such an advance."


Hard to determine just how much this reflects "wealth transfer", and how much it demonstrates hyperinflation at work. More "statistics".

As Puplava reminds us, the defiinition of a millionare in California is "home-owner".

flow5Crime #1532143/9/07; 06:00:29

Minneapolis is sending KC 50 policeman to help curb gang violence. Were #1 in the nation in violent crime. There have been a string of gun battles. The chief of police held up a machine gun this morning that was used to fire on the police. It was from teenagers who were in a drive by shooting. They got caught murdering 2 of their rivals.
GoldiloxNew Century falls on bankruptcy rumors: analysts#1532153/9/07; 06:16:57


NEW YORK (Reuters) - New Century Financial Corp. shares fell as much as 34.1 percent Thursday on market speculation that the subprime mortgage lender would seek Chapter 11 bankruptcy protection, analysts said.

Laura Oberhelman, a spokeswoman for Irvine, California-based New Century, said the real estate investment trust does not comment on market rumors.

The rumors surfaced six days after New Century disclosed a criminal probe into securities trading and accounting, and said its survival might depend on getting help from its own lenders. Earlier Thursday, Greenlight Capital LLC, the REIT's second-largest shareholder, said its principal David Einhorn resigned on Wednesday night from New Century's board.


Trouble in the RE "boom".

Clink!China's horde of dollars#1532163/9/07; 07:17:07

We all know that China has accumulated a vast store of electronic worth, which could become worthless at, literally, a key push. And that trying to get rid of it - or even just not adding to it - is likely to depress its value too. China is not alone in this, either.

So if you are a Chinese leader, what would you do ? How could you best use the dollars, even if their value does fall to zero ? This is a thought that has preoccupied many over the past few years, both at the Forum and elsewhere.

Assuming that you consider that the U.S. is your biggest threat (China's major oil supplier is Iran, after all), two items hit me over the last 24 hrs :-

The first is the tail-end of an article by Paul Craig Roberts which is interesting but off topic.

China has announced a 17.8 percent increase in its military budget for 2007.

China is America's most important banker. How long will China fund America's wars and trade deficit when it finds itself so threatened by America's "leaders" that it has to accelerate its military spending?

End snip.

So, in other words, China can either risk losing the value of the dollars, or will have to spend them on something of only marginal economic value (defense).

The other comes from Sir Rook yesterday :-

Rook (3/8/07; 21:24:41MT - msg#: 153207)
Thanks Randy, today I heard that china invested(?) 200 billion in fannie and freddie, and THAT was where the money came from to loan to all the marginal home buyers.
The loans that will be first perhaps to flounder in a downturn.

End snip

The old "build them up to knock them down" trick. After all, it worked in the USSR, which was a nice "controlled" implosion at its end, using overwhelming debt to stifle economic activity.

As China has experienced great hardship over the last seventy + years, and has managed to claw its way back to a degree of prosperity, I believe the first thing on the Chinese leader's mind would be to maintain the gains i.e. the economic system that has been rebuilt. The USA is in a totally different phase of its existence - decline leading to crisis - and may be totally blind to the risks it is running.


msiwantitallRE: Looking Ahead of the Fed#1532173/9/07; 07:54:10

Thanks to Mikal for posting this article. Bernanke's exhaustive effort to sound reassuring has sunk to new lows. By promoting "the importance of keeping inflation expectations low as way to keep inflation itself under control" is basically arguing to be allowed to perpetuate denial. How blatant can it get?

From one mouth of the government, you have David Walker, US Treasury Comtroller, going around spewing to anyone who will listen, including 60 Minutes, that the US is heading for financial trouble -- if Congress doesn't do something about it, as if it is all their fault; and from the opposite mouth, Bernanke is worried that if people get too scared about an impending inflation, they might (horrors) start spending less and saving their money, thereby inviting inflation!

This is as outrageous as if Kenneth Lay, just as Enron's unraveling was becoming evident to the Feds, had begged if he could keep things under wraps, lest it became known and all the employees started pulling out their money, possibly causing the collapse of the largest company in the world. Instead, he simply did not allow employees to take their stock out, and kept the money for himself.

Is there a lesson here?

flow5Bernanke's Politics Don't Make Their Way Into Monetary Policy#1532183/9/07; 09:12:37

Bernanke's technical staff uses a "Taylor-like Rule".

In 1992, Stanford University economist John Taylor developed a simple equation that, using grade school math and only three variables, told the Federal Reserve what to do:
r = p + .5y + .5(p - 2) + 2
where r is the federal funds rate
p is the rate of inflation over the previous four quarters
y is the percentage deviation of real GDP from a target.

The "r," of course, is what the Federal Open Market Committee deliberates at every meeting, and Taylor's formula not only described past Fed policy moves with startling precision, but also provided a systematic method for making future "r" decisions.

Ever since, scholars have been tweaking coefficients, modifying variables and debating its function, but Taylor's rule has remained the gold standard, so to speak—open to doubt and subject to discretion, but impossible to dismiss. "A simple equation that has proved remarkably useful as a rule-of-thumb description of monetary policy," wrote now-Fed Chairman Ben Bernanke in 2004. Or as Taylor observes in the following Region interview, "Staying close to the rule works pretty well."

The Fed's guru on legal reserves and the monetary base -- Richard Anderson

"well, yes, I suspect in part. The Fed's staff are all very sensitive to the Fisher equation and its implied spread between nominal market rates and "real" rates. Every economics class has taught about the Fisher equation for decades. But, of course, there are open issues -- which maturity of nominal rate to use? And which price deflator? Some folks would use an overnight rate, some a 90 day rate, some a government rate, some a private sector rate, some would use the 10-year bond rate, etc......

All monetary policymakers now understand what the academics call "Taylor's Rule" (due to John Taylor) -- when inflation increases and market interest rates rise with that inflation, the central bank must increase its target rate by more than the increase in market yields -- else, the central bank is just keeping abreast of the market and not leaning against the inflation. If such a rule is approximately correct, then it should also moderate the growth of the base and reserves (which of course are feeding the inflation). It would be a useful task to build such an empirical model and demonstrate how the process works, but I'm not aware of anyone doing so..."


CometoseWhat do you think ?#1532193/9/07; 09:31:28

$640 look about right on a pullback

Back up the truck

ToolieHelp#1532203/9/07; 10:19:26

Am I missing something obvious?

Snip: The monthly trade gap shrank 3.8 percent from December and was less than the median forecast of $59.7 billion made by Wall Street analysts surveyed before the report.
U.S. exports, which have been aided by a weaker U.S. dollar and stronger foreign economic growth, rose 1.1 percent in January to $126.7 billion.
U.S. imports fell 0.5 percent to $185.8 billion, although two categories -- food, feed and beverages and capital goods -- set new records. (end snip)

If Imports fell by 0.5% and exports rose by 1.1% , isn't that a 1.6% change? What am I missing?

Chris PowellPaulson tells China: Let Goldman Sachs, Morgan Chase take over your banks#1532213/9/07; 10:47:03

Paulson Urges China
to Deepen Reforms

By Geoff Dyer
Financial Times, London
Thursday, March 8, 2007

Hank Paulson, U.S. treasury secretary, outlined a new approach to economic and trade relations with China on Thursday in a speech calling on authorities in Beijing to deepen reforms of financial markets and let in more foreign investors and investment banks.

In a 45-minute address to financial executives in Shanghai, Paulson made only one indirect reference to China's policy for the renminbi, the economic issue that has dominated debate between the two countries in recent years.

Instead, he used his only public comments of a two-day trip to China to urge the country's leaders to speed financial reforms in order to create more balanced economic growth, encourage innovation, and make better use of natural resources -- all objectives that Beijing has itself recently emphasised.

"The risks for China are greater in moving too slowly than in moving too quickly toward transparent, liquid, stable capital markets," said Paulson, on the last leg of a three-country trip to Asia.

He added: "China is a large and powerful country and you should not limit your own potential by restricting your access to world-class financial expertise that can enhance your capital markets."

The message Paulson was sending, according to Andy Rothman, a Shanghai-based economist for CLSA, was: "If you give foreign firms much more access to your capital markets, that will enable us to dampen down protectionist sentiment in Congress and take a bit of pressure off the exchange rate issue."

Rothman said China might take some steps to open up its financial services market further before the next round of bilateral talks in Washington in May in order to reduce political pressure for measures against Beijing.

Since he became treasury secretary last summer, Paulson has repeated calls by other U.S. officials for China to allow the renminbi to appreciate more quickly against the U.S. dollar as pressure on Capitol Hill for retaliatory legislation against China has been mounting. But Thursday's speech, which detailed a set of capital markets reforms he said China should adopt, was part of an effort by Paulson to shift debate away from the short-term focus on Chinese currency policy, where pressure from the United States has so far had only modest results.

As well as letting in more foreign financial expertise, Paulson said China should take steps to boost its bond market, improve financial disclosure, and strengthen the base of institutional investors in its capital markets.

Paulson, a former Goldman Sachs chairman, urged China to let foreign companies take majority control of domestic investment banks and asset management companies -- where they were currently limited to 33 percent and 49 percent stakes respectively in joint ventures. He said Brazil, Russia, and India had all eliminated ownership caps in the securities industry.

"Experience demonstrates that the joint venture model does not work in the securities sector because investment banks are difficult to manage and control," he said. By letting foreign banks take controlling stakes in Chinese small and medium-sized banks, credit analysis skills in the banking sector would be also improved, he said.

Chris PowellChina forms company to spend FX reserves#1532223/9/07; 10:48:47;_ylt=AqF_a7vqnoH15bLifJ8YBg1u24cA

By Joe McDonald
Associated Press
via Yahoo News
Friday, March 9, 2007

BEIJING -- China is creating an investment company to make more profitable use of its $1 trillion in foreign currency reserves, the finance minister said Friday, in a move that could change the flow of billions of dollars in global markets.

Finance Minister Jin Renqing gave no details of how the Cabinet-level company might invest the reserves, which are believed to be mostly in safe but low-yielding U.S. Treasury bonds. He also did not say what portion of the reserves might be channeled through the company or when it would start to operate.

"We can achieve more profit from the investments," Jin said at a news conference. "We are now preparing the organization of this new corporation."

Analysts have speculated for some time that China would create an investment company, and officials have said repeatedly they want to make better use of the country's reserves.

Economists have suggested Beijing might allocate as much as $200-400 billion to the new company, which in a single move could create one of the world's richest investment funds.

"They want to be more aggressive than what they do with current reserves," said economist Mingchun Sun at Lehman Brothers in Hong Kong.

"They could invest in higher-yield products -- stocks, corporate bonds, maybe even commodities," Sun said. "Basically, the returns would be higher because the risk is higher."

Jin said Beijing would try to learn from the experience of other governments. He cited the example of Singapore's Temasek Holdings, which manages nearly $90 billion in government pension funds and other assets.

Temasek owns stakes in Singapore Airlines and Singapore Telecom, as well as in banks, real estate, shipping, energy and other industries in India, China, South Korea and elsewhere.

Spokespeople for Jin's ministry and the central bank and foreign currency regulator declined to give any other details.

A shift in China's investment strategy could change its purchases of Treasuries, affecting a market that Washington relies on to help finance multibillion-dollar budget deficits.

But Sun said that with the reserves growing by as much as $20 billion a month, Beijing could afford to keep buying U.S. government bonds while also channeling billions into new investments.

U.S. Treasury Secretary Henry Paulson, in an interview this week on the U.S. television network ABC, rejected suggestions that changes in Chinese bond purchases could affect the United States.

Paulson said Beijing's entire holdings represent the equivalent of less than a single day's trading in Treasuries on global bond markets.

Chinese economists and media reports have suggested China might adopt more unusual investment approaches, ranging from stockpiling oil and other raw materials to spending more on social programs in order to encourage Chinese consumers to spend more and reduce dependence on exports.

The growth in China's reserves is driven by the rapid growth of its exports, which brings in dollars, euros and other foreign currency, and by the billions of investment dollars being poured into the country.

The surge in money flooding in from abroad forces the central bank to drain billions of dollars from the economy every month by selling bonds in order to reduce inflationary pressures.

The composition of China's foreign currency reserves is a secret. But economists believe that as much as 75 percent is believed to be in U.S. dollar-denominated instruments, mostly Treasuries, with the rest in euros and a small amount in yen.

Stephen Green, chief economist at Standard Chartered Bank in Shanghai, calculated that last year the central bank made a $29 billion profit on its Treasury holdings after paying interest on its own bonds and other expenses.

But even that represents a return of less than 3 percent on the $1 trillion in holdings.

By contrast, Singapore's Temasek says it has averaged an 18 percent annual return since it was created in 1974.

flow5Trade Stats#1532233/9/07; 10:58:49

Jan Dec %
Balance -$59.1 -$61.5 3.8%
Exports $126.7 $125.3 1.1%
Imports $185.8 $186.7 -0.5%
don't add percentages

mikalLike day and night#1532253/9/07; 12:27:39

ECB raises benchmark interest rate as it warns of inflationary pressures
By Carter Dougherty Published: March 8, 2007
Snippits: "FRANKFURT: The European Central Bank on Thursday raised its benchmark interest rate a quarter percentage point, to 3.75 percent, as it made clear that it was willing to tighten credit even further — possibly by this summer — in a humming European economy that could generate higher inflation.

The ECB president, Jean-Claude Trichet, pointed to possible spikes in energy prices and, above all, big pay increases in major European wage settlements as reasons why the threat of higher inflation, its chief bête noire, might require a response.
"I didn't say we are at a peak," Trichet said. "Full stop.""

Mikal-- Unlike yesterday's American reports that the ECB would almost certainly not raise beyond 4%, this diverges in every respect as well as with constant reports of tepid or sluggish euro-zone growth that aim to support the dollar vs the euro. You can't rely on mainstream media by and large wherever it comes from, but you jump at the chance when it hands you something, especially if it stands out like day vs night on a whole raft of issues.

"Having hinted strongly at more rate increases to come, Trichet left open the question of how much and when. Most analysts believe the answer depends on whether the euro-zone economy — which grew at a six-year-high rate of 2.6 percent last year — keeps up that pace this year.
On Thursday, the ECB forecast growth for 2007 to 2.9 percent from 2.1 percent, slightly higher than its prediction only three months ago, reflecting brisk economic growth toward the end of 2006.

The ECB's policy of tighter money reflects fears that a recovering euro- zone economy will generate more inflation, now hovering slightly under the bank's target of close to, but below, 2 percent.
Following the bank's seventh interest rate increase since it began raising rates in December 2005, the ECB is nearing the "neutral" rate which neither feeds nor hampers economic growth, which has experienced a sustained pickup over the past year in the 13-nation euro area...

Bank watchers generally agree that there will be at least one additional rate increase, and some expect two or more."

MKAre you a member of the USAGOLD NewsGroup?#1532263/9/07; 12:28:09

Well, if you aren't, we invite you to become one.

In our current issue, find out why.............

Goldman Sachs is warning of "dead bodies" after last week's market turmoil. What does it mean for the future? Why the sense of urgency?


Who is the prominent analysts who says "gold is dirt cheap here" and why is he saying it?


How will South Africa go about keeping its position as the world's number one gold producer? You might be surprised at the answer.


Let's entertain for a moment the possibility that Alan Greenspan is on-the-money with his prediction of a one-third probability of a recession by the end of the year. How will gold fare?


Goldman and Merrill Lynch see a U.S. rate cut coming before the end of the year. If so, how will it affect gold? The dollar? Your portfolio??

This particular NewsGroup was assembled FOR THE WEEKEND -- for those interested in developing the deep background behind the gold market headlines.

We invite you to become a full-fledged member at the link above. We find the news most important to gold owners, rate it's overall importance on 5-Star basis, throw-in our own gold-based interpretation and deliver free of charge to your personal e-mail box.

We invite you to join us at the USAGOLD NewsGroup.

GoldiloxTrade stats#1532273/9/07; 12:43:31

@ Flow5,

While those are interesting as raw numbers, our actual "production" numbers look even more abysmal.

It looks like Paulson is lobbying to get GS and Chase more Chinese banking business to jury-rig the stats to appear that the US is actually producing something.

The Chinese will probably:

1) create their own pyramid schemes and see how GS likes them apples, or
2) tell them to "go pound sand".

The golden rule: "Them what has the gold, makes the rules."

TopazOdd action around the E-rate move.#1532283/9/07; 12:43:49

There's certainly enough contrary activity in the Markets today to give one cause to suspect the carnage 'aint quite over just yet.
DX minnow the CAN$, along with it's bigger brother GBP ...and the little Aussie bleeder all rallied in support of the Buck whilst the others sold off heavily.
I'd have thought an E rally would have been a gimme on notice of a rate hike??

This from a bloke STILL waiting for the Au-Ag ratio to get to 30:1 over the next few weeks ...thank god I've got a good day-Job!

TopazOddities seen better here.#1532293/9/07; 12:52:26

Don't want to labour the point but heres a view of the contrary activity today.
The various currency-PoG's

mikalDupli-city#1532303/9/07; 12:55:36

London v New York: top US regulator attacks AIM ‘casino’
Tom Bawden in New York and Martin Waller in London
The Times Online | 03-09-07 | Excerpts: "The US Securities and Exchange Commission (SEC) launched an astonishing attack on the City's regulatory standards yesterday, just weeks after an American bidder failed in its quest to buy the London Stock Exchange...
"I'm concerned that 30 per cent of issuers that list on AIM are gone in a year. That feels like a casino to me," Mr Campos said on the sidelines of the SEC Regulation Outside the US conference in London. "It is a losing proposition to tout lower standards as a way to promote your markets."

As the competition to be the world's leading financial centre hots up between London and New York, Mr Campos upped the ante by suggesting that the LSE would also suffer as a result of the lax regulation of AIM. "There's also a danger with higher standards; if it's too affiliated with an exchange that has lower standards, it gets painted with the same brush."

Have your say - (Comments)Snippit:
"When comments like these come out, combined with various papers coming out recently about the competitive disadvantage US exchanges now have compared to elsewhere in the know the US exchanges (and their regular) are concerned.
For this they only have themselves to blame - bringing in the hugely time-consuming and expensive Sarbanes-Oxley rules would not have stopped an Enron, but does have the effect of capital going to a more appropriate regulatory environment than the sledgehammer of SOX. The US regulators appeared to forget there are alternatives to listing in the US, but now they have been reminded by US companies listing there they complain.

Nicholas Hanes, Tunbridge Wells, UK"

Mikal-- Not necessarily a terminal pissing contest between these enormous entities. But as one letter writer comments, "This is meant to be the gold standard of stock market regulation?"

ToolieTrade data#1532313/9/07; 13:01:24

Thanks flow5
flow5Pullback to 640?#1532323/9/07; 13:05:55

I know nothing about support & resistance, only about time and rocs.

Only March looks weak to me this year. Though when considering that short time frame, I wouldn't want to miss out on the overall trend. That said, it would be hard for me to expect any weakness from now on.

But I have no doubt, in the long run, it's impossible for the U.S. to continue to run huge current account deficits without the dollar falling, and conversely, gold appreciating.

GOLD FINGERQUESTION??#1532333/9/07; 13:41:59

What comes after Trillion?


Then what??

How far can this all go?

Maybe Flow5 has a point on this...or anyone??


Happy Spring

adminFinal warning#1532353/9/07; 14:01:48

on stock touts. Be advised. The rules are the rules and they apply to ALL.
CometoseCOT#1532363/9/07; 14:12:50

THE COMMERCIALS in SIlver were NET long 17000 contracts
The commercials in Copper were net short 760 contracts
and the commercials in Gold were net long 48800 contracts

mikalClearing the air, one fresh gust at a time#1532373/9/07; 14:26:18

Gold likely to remain in up-trend for years to come
The Canadian Press - Business News
2007-03-09 14:15:00 - Snips:
(Special) - The rise in the price of gold is often attributed to world political factors, such as Iran's defiant stance on uranium enrichment.

But even when world political tensions concerning the Middle East eventually subside, there is one underlying cause - the re-pricing of U.S.-dollar assets because of that country's deficits - that is likely to continue to keep precious metals in an uptrend for years to come.

It's not just gold and silver that have been affected. The U.S.-dollar prices of many metals have climbed dramatically."

Mikal-- Good points throughout. Like glacial water, not much you can do to improve it. Like a good bracer, you
want to drink it though it would be tough against some faces.
If I may be overindulging with the reprinting here, I hope that the unrelenting, vital nature of these qualities would exonerate me in full measure.

"But the attraction of U.S. assets has been wearing thin. Holders of U.S. dollars worldwide, including some central banks, are instead now choosing more often than before to accumulate gold or alternative currencies such as the Euro.
It's just common sense. Why should they continue to prefer U.S.-dollar assets when their value is steadily dropping against virtually everything else?
The U.S. Federal Reserve may find it harder to navigate through the deficit mess in the coming years.
If the Fed were to continue to support the U.S. dollar with additional interest rate increases, U.S. stock and home prices would likely tumble, causing economic turmoil. If instead the Fed were supportive of stock and home prices (by holding down interest rates), the U.S. dollar would depreciate further.
Obviously, when the deficit problem turns into a crisis, the Federal Reserve will print money and keep interest rates on the low side in order to keep the economic wheels turning, even if it means higher inflation.
If you are sitting in the United States, you may conclude this is the right thing to do. But if you are anywhere else, you would be asking yourself why you should continue to hold U.S.-dollar assets if their fate is a further loss of value.

What has happened historically is that assets in a country with a high current account deficit lose value relative to the assets in countries that don't have such problems. As investors look for ways to preserve their wealth, the value of precious metals also goes up relative to the assets of the country with a high current account deficit.

Recent developments are indicating that history is repeating itself. U.S. assets, particularly financial assets, are losing ground against all others.
The process is likely to continue for many years to come, and precious metals will be among the beneficiaries."

Cometosesilver#1532383/9/07; 14:29:20

Someone said volume precedes price .

If the volume spikes in some of the junior miners is any indication and some of the other activity including break outs............

Many of them are also flagging ......

Looks like something is brewing and bubbling hereunder ....

Looking over at yonder horizon , there appears to be a major eruption on the way .......

a geologist might think these indicators parrallel
Seismic activity....

TopazAxually GF, a zillion doesn't get a gurnsey. #1532393/9/07; 14:39:00

Topaz (2/28/07; 01:05:59MT - msg#: 152787)
@PA ...billion.
A Billion here a billiad there, pretty soon we're talking PaperMoney.

There is a quirk in accounting in Europe that you may or may not be aware of ...and it may or may not be relevant to ECB accounting.

American British
million 6 6
billion 9 12
trillion 12 18
quadrillion 15 24
quintillion 18 30
sextillion 21 36
septillion 24 42
octillion 27 48
nonillion 30 54
decillion 33 60
undecillion 36 66
duodecillion 39 72
tredecillion 42 78
quattuordecillion 45 84
quindecillion 48 90
sexdecillion 51 96
septendecillion 54 102
octodecillion 57 108
novemdecillion 60 114
vigintillion 63 120

Good to see the US SM's recover in that rarified vapor that is aftermarketAu Trading on a Friday.

TopazGF ...also, somewhere...#1532403/9/07; 14:49:11 that lot (the numbers represent Zeros) lurks a Googol ...of Google fame. It's claim is 10 to the 100th power, or 10 with 100 zeros.
TopazBond.#1532413/9/07; 15:02:19

One didn't have to look too far to account for the PoP in DX at 0800 this am.
Those pesky E-Bond traders in Europe and points east served up a doozie to the day traders ...who managed to eke out an unch on the day after all was said and done.

flow5gold's upturn#1532423/9/07; 16:01:18

As of 7/1/06 the current account deficit was 5,563.78 trillion.

By the PPP index, the dollar is overvalued against all of our trading partners.

To prop their economies and forestall exchange rate losses, the far-eastern countries peg their currencies against the U.S. dollar.

Their foreign-exchange reserves are in the trillions.

Throughout history, pegged exchange rates, sooner or later have always failed.

The Bush administration 1) ignores the consequences of our excessive U.S. government unilateral transfers to foreigners (the war in Iraq, etc.). This drain alone was enough to end the dollar's convertibility into gold. And 2) ignores our dependence on imported oil (65% of the 763 bill trade deficit in 2006? I think).

The Fed has nothing to do, and can't have anything to do, with exchange rate value of the dollar. The Fed is powerless in this regard.

The dollar has no where to go but down.

USAGOLD Daily Market ReportPage Update!#1532433/9/07; 16:46:44">
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 Report

March 9 (MarketWatch) -- Gold futures fell from a one-week high near $660 an ounce Friday as a rise U.S. payrolls met most market expectations and the trade deficit narrowed, boosting the dollar and easing investment demand for precious metals. But after climbing over the last three sessions, gold futures finished the week with a more than 1% gain.

Gold for April delivery closed down $3.50 at $652 on the New York Mercantile Exchange. The contract had traded as high as $659.80 earlier in the session.

Early Friday, the market was on its way higher "but the market perceived economic data as dollar friendly," said Peter Spina, chief investment strategist at

U.S. jobs data showed that nonfarm payrolls increased by 97,000 in February, slightly lower than the 100,000 expected by economists surveyed by MarketWatch. It was the smallest job gain since January 2005. The unemployment rate fell back to 4.5% from 4.6%.

Following the jobs report, the dollar rallied against the yen and rose against the euro.

Goldman Sachs bullish on gold...

"The recent sell-off in gold and gold equities has created a good buying opportunity for gold, given strengthening fundamentals," said Oscar Cabrera, a Goldman Sachs analyst, in a Friday research note.

Goldman Sachs expects gold prices to end 2007 at $725 an ounce and to average $689 an ounce during the year, boosted by further declines in the dollar.

Expectations of widening interest rate differentials between the United States and the rest of the world will continue to weaken the dollar in 2007.

Factors that will provide support for the precious metal, Goldman Sachs said, include a weak U.S. January durable goods report; concerns over performance of sub-prime mortgage loans which could impact the U.S. financial system, further weakening of the dollar; concerns of an over-extended yen carry-trade, which if unwound could strengthen the yen versus the U.S. dollar; a 9% drop in Chinese equity markets, rising global risk concerns; and comments by former Federal Reserve Chairman Alan Greenspan that a recession was possible in 2007.

Demand for gold has also remained strong, while mine production has slipped in the last few years, as companies deal with mature ore bodies, lower grades and increasing costs for developments, Goldman Sachs said.

Finally, net central bank sales fell sharply in 2006, and the central banks of important emerging markets, like China and Russia, are adding to their gold holdings to diversify their reserves.

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

USAGOLD / Centennial Precious Metals, Inc.Step inside and shop at your convenience. Open 24/seven.#1532443/9/07; 19:59:56

shop for gold coins
OvSTreasuries.#1532453/9/07; 20:07:50

Paulson: China's entire
holding of US treasuries
represents less then the
daily total of US treasu-
ries traded each day on
the global bond-markets.

Globalization is going on
for a long bet!

Mindbending. OvS

slingshotTEOTWAWKI#1532463/9/07; 20:08:40

And I Feel Fine.
by Doug Casey.


slingshotThe Worst Is Far From Over#1532473/9/07; 20:15:39

By Peter Schiff.


Paper Avalanche@ slingshot#1532483/9/07; 21:04:31

From Peter Schiff's piece...

"Since 70% plus of the U.S. economy is based on consumer spending, how can we possibly avoid a recession if the credit well financing much of it runs dry? Since home equity has been the principal asset collateralizing that credit, how can consumers keep borrowing and spending when housing prices fall?"

I believe that the answer will be to simply fire up the helicopters to rain money down on the lumpentariat.

How do you do that?

Increase the minimum wage by 40% (from $5.25 to $7.50) over a 24 month period. This will serve to inject new "money" into the system as the refi / home loan ATM spiggot slowly becomes a memory.

On another note, the banks will enjoy having a new (and growing) sub-set within the borrowing population of the lumpentariat who are now forced to borrow at far higher rates as a result of their being ground up in the easy-money / real estate sting.

If I wanted to grind up a part of the most susceptible part of the population for profit I would do the following:


1. Lower interest rates to artificially low levels
2. Remove all viable borrowing qualifications (i.e. income verification, etc.) to suck in the stupid and the greedy
3. Actually fund television ads that run all day prompting people to take out big mortgages for new homes / assume more debt on their existing homes (it might ryhme with Hi-tech)
4. Instruct my paid whores in the financial media to endlessly promote a new bull market in real estate so as to prompt the average viewer to take advantage of items 1 and 2 above


Once I was convinced that asset prices had peaked and that everyone who had a pulse was in hock as part of the grand scheme, I would lower the boom by doing the following:

5. Have my bought and paid for politicians reform the bankruptcy laws to ensure that there is no way out for the lumpen from a life as a chattel slave when the music stops
6. Have the same upstanding politicians pass additional legislation just a few months following doubling the minimum payment on credit card debt
7. Manufacture a crisis of confidence in subprime lenders to tip over the first domino (please see Peter Schiff's article for how the dominos will fall from bottom to top in the real estate market) such that lenders no longer provide easy money via such things as zero down mortgages (please see story on GMAC announcing today that it will be doing just that)
8. Simply wait for the inevitable to play itself out.

Were the above played out over a period of months intsead of years then maybe more people might see how ingeniously this trap was laid, executed and will ultimately be profitable for those whose agenda is to profit at the expense of the masses. Like shrub says, connect the dots.


Rook.,.#1532493/9/07; 21:09:49

I think the value of the napkin I have that was signed for me in 1969 by Neil Armstrong and the other feller who first walked on the moon, just went down.
I was a kid, and of course am surprised to have found a web site that shows some curious photos that seem to support thier claim that the first moon walk didnt happen.
I was ok finding out about the easter bunny, and of course Santa was a bit more of a dissapointment, then parents, police, president, all humanity, well, childhood is best served with innocence and some cheerful fantasy, however, I WOULD like the revealings to come to a stop. But, I suppose that aint in the cards.

GEMSTOCKSIMF to sell gold?#1532503/9/07; 21:58:42

According to Kiplingers Letter the International Money Fund (IMF) will soon start selling the $63 billion in gold it owns. Has anybody else heard that? Where did the IMF get that much gold?

Kiplinger's said it would be sold slowly so as not to affect the POG but there's no way anybody can sell that much without having an affect.


mikal@Gemstocks#1532513/9/07; 22:18:24

Welcome. IMF sales must be approved by Congress( the 'swing vote' goes to Washington) but Congress will soon be overtly and directly marginalized and over ridden by the one world government, instead of covertly and less efficiently.
At the same time, some beleive the IMF doesn't actually have PHYSICAL GOLD even as a custodian, but rather, paper commitments or contracts etc.
If GATA is right about the amount of physical gold held by CB's, it doesn't matter whose gold they sell, Japanese WW2 gold from the Philipines or the CB's own allocated promises. Because of the supply/demand deficit, ongoing demand curve steepening, flight to quality and ultimate POG reappraisal by the financial establishment itself.
Any "sales" by the IMF will be offmarket transfers between CB's after the intentional collapse of the markets.
If this does not happen within months, it will not happen.

mikal@slingshot#1532523/9/07; 23:17:03 Thanks, good ones.
Bill Murphy's Midas report is on a roll lately also.
You may have seen this one, spot on in many regards
(it hasn't the length needed to fully develop and substantiate one or two of it's assertions),
but I agree with most of it thus far:
The Federal Reserve Will End in Bank Failure by Lee Rogers March 9, 2007

mikalGreenie and Heli Bennie ready for Fannie and Freddie?#1532533/9/07; 23:45:50 Greenspan's recession comments on US spooks global stock market - Headache for Bernanke | AP | Arab Times - 3/10/07
Grrenspan will apparently exercise more precautions to prevent his paid, private remarks and investment tips from being leaked into the mainstream if this article is to be believed.
However, IMO such forecasts have value to CNBC and the PTB at the very least as they permit a sideshow to draw in viewers and satisfy investors with a diversion (excuse, alibi, rationale) for market happenings.

GoldiloxMany Revealings#1532543/9/07; 23:51:21

@ Rook,

One of the main themes of the web bot analysis is "secrets revealed" being the trojan horse in the wayward gubmint!

mikalTwist and shout, let's do the twist...#1532553/9/07; 23:59:24 Greenspan still the guru, now with recession twist-Business-The Washington Times, America's Newspaper - AP - Martin Crutsinger - March 10, 2007
Here is a better link to the story

GoldiloxMany "Revealings"#1532563/10/07; 00:05:52

@ Rook,

One of the main themes of the web bot analysis for the last couple years has been "secrets revealed" as the Trojan Horse for the wayward PTB!

One of my favorite questions is:

If they really went to the Moon, why are they just now offering a "prize" to anyone who can design bio-protection from the van Allen radiation belts?

Ummmm . . . aren't those located somewhere between here and the Smiley Face in the night sky? There's a lot of "solar energetics" going on outside our comfy shield that low Earth orbits (like Space Stations and COMM satellites) are naturally protected from.

<(:^) G'lox

slingshotmikal#1532573/10/07; 08:12:15

We are again below the resistance level of $660. The solid bashing downward to slow recovery has lots to say about gold. Everything that I read is geared to the ultimate outcome as the PTB invent new rules to prolong the game of FIAT. With each tremor (bashing) the fault line is letting us know that a huge earthquake is on the horizon.
I prepare for the major moves in price and expect them for that is what needs to happen to send gold higher.

As we prepare our necessities one should put away some luxuries like a few bottles of Good Brandy or a box of Fine Cigars. Not as items to gloat but items to reward ourselves for our labor.


slingshotFuture of Gold#1532583/10/07; 08:40:12

Everybodys talking about it ;0)

mikal@slingshot#1532593/10/07; 08:40:59

Re: Large price changes - You mean this month was just a warm-up? :)
Re: reward ourselves, 'There is no rest for the wicked.' ;)
Story from January that may be old news to some, but still current(unless we return to the stone-age, make that GLASS stone-age):
Bloggers - Fifth Estate of journalism - MarketWatch - 01/31

MKAre you a member of the USAGOLD NewsGroup?#1532603/10/07; 08:57:30

Well, if you aren't, we invite you to become one.

In our current issue, find out why.............

Goldman Sachs is warning of "dead bodies" after last week's market turmoil. What does it mean for the future? Why the sense of urgency?


Who is the prominent analysts who says "gold is dirt cheap here" and why is he saying it?


How will South Africa go about keeping its position as the world's number one gold producer? You might be surprised at the answer.


Let's entertain for a moment the possibility that Alan Greenspan is on-the-money with his prediction of a one-third probability of a recession by the end of the year. How will gold fare?


Goldman and Merrill Lynch see a U.S. rate cut coming before the end of the year. If so, how will it affect gold? The dollar? Your portfolio??

This particular NewsGroup was assembled FOR THE WEEKEND -- for those interested in developing the deep background behind the gold market headlines.

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flow5There will be no recession!!!!#1532613/10/07; 09:11:17

Pay attention. I'm the only one on this planet that knows the Holy Grail. (I had a 6 pack before 9:00 am). It would be an historical break, and a theoretical break if the economy turned down.

97.60.380.07 Jan
92.9-0.16-0.09 Feb
95.50.03-0.01 Mar

legal 10 roc 24 roc

Riddle me this:

If commercial banks create money in the lending process (through fractional reserve banking)
Then why do commercial banks pay for savings (which they do not loan out)
Only Bernanke can take money out of the banking system.
Money flowing to the intermediaries actually never leaves the commercial banking system as anybody who has applied double entry booking on a nation scale should know. And why do commercial banks pay for something they already have? --- interest on their deposits?

Paper AvalancheThe domino effect becoming a reality#1532623/10/07; 09:13:12

Apears that Peter Schiff's prediction of the real estate dominos falling from bottom to top is materializing more quickly than anticipated.


Troubles Hit Real Estate at High End
Published: March 10, 2007

Until now, deep-pocketed Wall Street tycoons and foreign investors benefiting from a weak dollar seemed to be holding up the luxury real estate market even as the low-end fractured. But there are signs that some high-end real estate developers are also being hit by the slowdown.

Skip to next paragraph

John Loomis for The New York Times
A condo-hotel developer let the mortgage expire on the Royal Palm Hotel in South Beach, an area of Miami Beach.
Last night, a condo-hotel developer who was a partner with celebrities in selling luxury perches from Miami to Chicago let the mortgage on the Royal Palm Hotel in South Beach, a trendy section of Miami Beach, expire. The missed deadline places another luxury condo project into the hands of bankers specializing in troubled mortgages.

Jack McCabe, a real estate consultant in Deerfield Beach, Fla., said there would be more troubles for developers, lenders and title insurance companies.

End Snip

slingshotflow5#1532633/10/07; 09:25:28

Commercial banks can not print money and so pay depositors for the use of their money. It is a small amount to pay deposits as the lending interest rate is higher.
Slingshot---- <Wild Guess>

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Rook.,.#1532673/10/07; 09:51:28

Paper Avalanche, rather than "hit" with the slowdown, I suspect they are taking advantage of the slowdown, and even collude with the guys they hand properties off too.
As a newbie to "conspiracy nut" status, I also imagine that the change in the yen last week was pre known by those in the know, the "our crowd" folks, and I would like to know just who got clobbered in the leverage trader carry trade wipeout. I suspect that who is NOT on that list, would tell us a lot.

Rook.,.#1532683/10/07; 09:59:08

Sir Slingshot, your link to found me accepting the logic until I reached this line in qoutes;
"I do not believe that that we will enter into a World War for resources..."
I would like to see the analysis from someone who really does believe we absolutely will. Or perhaps more accurately, ARE.

Silver FoxRook #: 153268#1532693/10/07; 12:37:57

Resource wars.

Unfortunately, I am you man. First, lets establish the "situation" prior to the resource wars. The readers of this forum are aware that the "dollar" will, at some point, crash and become worthless. Hopefully, the rest of the world's economies will not follow. However, given how the rest of the world is following in the US's foot steps in printing increasing amounts of fiat money, it is also likely that their currencies will follow step. So this collapse will likely be a worldwide event.

Next step in assessment: The collapse of the currencies will result, for a time, the end of world trade. As the dollar becomes worthless, there will be a large disruption in domestic consumption. Food, gasoline and electricity will be permanently disrupted. You can anticipate the rioting in the streets when basic necessities are no longer available. No more oil from OPEC countries. No more cheap electronics from China. Basically, no more trade. You can't have international trade without an agreeable currency.

Next step, go forward 3 to 5 years. Machiavellian types will endeavor to seize political control in the different countries. These shysters will identify the "evil doers" who were the cause of "all our grief". This is usually when the war drum starts to beat. This is a fairly good assessment.

Unfortunately; DO YOU REALLY BELIEVE WE ARE IN IRAQ AND THREATENING IRAN because of weapons of mass destruction? One BIG clue is the lack of activity with (no oil) North Korea.

I believe that the US is ALREADY in a Resource War. The current administration jump-started the war "while" the US "still" has a military. As you are probably aware, in the next few years the baby boomers will begin to retire in masses, (that is 27% of the US population). Our government's tax receipts will plunge at the same time Social Security and Medicare costs skyrocket. There will be no money left for the military. As such, I doubt that the US's military in 2015 will be able to punch it's way out of a preverbal paper bag.

So, how do you start a resource war? I suggest you research the attached website for additional information. If you do the research, I think you will find that it looks like our "leaders" pulled the trigger on the twin towers as a psychological ploy to manipulate the "righteous" revenge minded US citizens into supporting a war. This is a stealth war for oil resources and dollar hegemony. It is no surprise that China & Russia are maneuvering against the US by selling high tech "defensive" weapons to Iran. With two, (soon to be three), aircraft carries task forces in the Persian Gulf, no wonder Representative Ron Paul is worried about another Gulf of Tonkin incident, resulting a war with Iran. You can just "see" this stuff coming our way…

When these bombs drop, you better be holding gold.

Sorry for this miserable assessment.


PS: I hope I "didn't" cross the line with this posting.

Placer GoldQuestion for Flow5#1532703/10/07; 13:24:19

Could you explain what your chart represents and what it means?

97.6 0.38 0.07 Jan
92.9 -0.16 -0.09 Feb
95.5 0.03 -0.01 Mar
95.5 0.07 0.04
95.5 0.17 0.00
95.5 0.08 0.00
95.5 0.25 0.03
97.4 0.38 0.00
96.5 0.08 0.03
97.0 -0.06 0.00
97.4 0.45 0.00
101.5 0.60 0.00
legal 10 roc 24 roc


USAGOLD / Centennial Precious Metals, Inc.March Buyers' Group -- The Ever-Popular Gold German Mark!#1532713/10/07; 14:27:34">gold and volatility
Topaz$^ = PoG "what??"#1532723/10/07; 14:30:34

PoG relates to the Bond/Dollar in concert and can currently be relied upon as a barometric indicator of the success or otherwise of composite Buck management.
I can imagine a scenario where PoG = $1000 ...and DX was 90, just as easily as I can PoG $400 and DX 80. In both instances the Yield on Bonds would be off the scale in either direction mind you ...but BOTH are doable!

TopazLS Crude/alt Dollar.#1532733/10/07; 14:41:30

PoO seems more inclined to "stick with the program" this year than it has in the past ...see Chart.
So Higher Dollar = Lower PoO far in 2007 anyway!

mikal(No Subject)#1532743/10/07; 14:41:34

Profiting From Impending Stagflation and Equity Markets Breakdowns
Posted Friday, 9 March 2007 | DEEPCASTER LLC - Snippit:
Wealth Preservation Wealth Enhancement
Financial and Geopolitical Intelligence
and a Precious Metals and Strategic Commodities Markets Warning

Deepcaster uses the term "Impending" qualifiedly since the Real Data shows that the U.S. economy has been in a stagflationary condition for some months now. But given the probable duration and depth of the Stagflation to come, the use of the word "impending" is nonetheless appropriate.

The Good News is that understanding the character and causes of Stagflation and the ongoing Markets Intervention allows the savvy investor to develop a Rational Strategy for Profits. For a Summary Overview of Markets Interventions and Data Manipulations see "Juiced Number IV: How the Government Gets the Statistics It Wants, Markets Get Manipulated, Citizens Get Deluded and Worse" available at
Lest there be any doubt that the U.S. economy is in fact in an Inflationary Recession (i.e. Stagflation) consider two key data - - the GDP and CPI as reported in Deepcaster's March Letter - - plus another recent key datum as reported below:"

osa104cPick your collective brains?#1532753/10/07; 16:01:54

How do Central Banks decide on the CURRENT exchange rate of RELATIVE worth to one another...........Is a short, simple answer or concept possible, as I may share with another?............gratitude in advance ............ AMF
Paper AvalancheThe M3 Chart is updated through 3/9/07#1532763/10/07; 16:31:53

GoldiloxRelative currency values#1532773/10/07; 19:16:38

@ osa104c,

If the currency is traded on the FOREX or other markets, the "market' determines the relative value, based on supply and demand. If not, some arbitrary "value", called a "peg" is maintained, as long as possible by internal banking machinations.

Chris PowellA mining speculator fights a gold Goliath high in the Andes#1532783/10/07; 19:32:37

Rick Westhead
Toronto Star
Saturday, March 10, 2007

COPIAPO, Chile -- When mining speculator Rodolfo Villar discovered Canada's Barrick Gold Corp. wanted to buy his claim to a remote, rugged tract of land in the Andes mountains, he anticipated a million-dollar payday.

It was no secret that Toronto-based Barrick, which owned a sprawling mine in the mountain range called Pascua-Lama, was anxious to buy Villar's nearby claim, the 56-year-old said.

Located in the thin, frigid air of the Andes some 4,500 metres above sea level in northern Chile, the mine reportedly has gold and silver reserves worth US$12 billion. Lucky for Villar, the lone road to the mine snakes straight through his claim.

But days after he signed over mining rights to a 3,100-hectare plot, Villar said he learned what he had unwittingly agreed to.

"I got $20," said Villar, a pot-bellied and balding former miner with a round, bronzed face. "I felt sick and cheated."

A Chilean court agreed last fall that Villar had been wronged and ordered Barrick to return the rights to the plot.

The contentious court decision, which the company is appealing, now threatens to at least delay Barrick's efforts to tap one of the world's largest undeveloped deposits of gold, silver and copper, as it wrestles with the multi-million-dollar legal claim.

A spokesperson for Barrick, Vincent Borg, calls Villar's case a "nuisance suit" and said the company is appealing. Chile's appellate court could decide as soon as April whether to uphold the decision against Barrick. The company has received permission to proceed with plans to develop the mine until the ruling.

Like many mining ventures, Barrick's efforts at Pascua-Lama, which straddles Chile's border with Argentina, have been controversial.

Environmentalists have bristled over plans to move literally mountains of ice to access the coveted deposits. But what sets the Barrick dispute apart from most mining battles is its thorny, if unlikely, dispute with Villar.

Villar acquired the mining rights to the area in 1996 after a former rights-holder let the claim lapse. He owned them for a year before Barrick approached him with a purchase offer.

"My lawyer was my friend for a long time," Villar said from his hometown of Copiapo, Chile. "I drove down to Santiago to his office and he opened the contract to the last page and said sign here. I trusted him."

The same day he signed away his mining rights for land near Pascua-Lama, Villar's lawyer sold a much smaller parcel of land to Barrick for $650,000. Barrick spokesperson Borg says the company believed it had a package deal to buy both parcels of land.

Villar's new lawyer, Hernan Montealegre, is a prominent human rights advocate; in 1998, he travelled to London to assist prosecutors building a case against dictator Augusto Pinochet for genocide, terrorism and torture.

"There's no way to get trucks to the mine without going through Villar's concession, and there's nowhere to put waste rock without having that land," Montealegre said, motioning to maps showing the disputed territory. "We had first asked Barrick for $1 million to settle this, but after the court decision, we wouldn't take less than $300 million."

It's pointed out to Montealegre that his client's signature is clear on the photocopied sales contract he pulls from a ream of files.

"That doesn't mean anything," he said. "You think he would get in his car in Copiapo and drive 10 hours to Santiago for the day, staying over for the night, so that he could sell this land for $20? It doesn't make sense and the judge agreed with that. Rodolfo has an eagle eye for mining, but not for business."

Yet Barrick lawyer Patrick Garver said Villar made the trip because he eyed a much larger payday.

Both Villar and Montealegre have been trying to sell financial interest in their case against Barrick, "on the streets of Vancouver, on the Internet, and wherever else they can," Garver said.

For instance, a Dec. 1, 2006, email solicitation allegedly distributed by a German company offered Villar's "litigious rights" for $600 million. The email, provided by Garver, alleges that once Villar's claim is confirmed by Chile's high court, the value of his mining interest will eclipse $1 billion.

"Barrick Gold is trying to negotiate with us, but we are not prepared to subordinate our timing to theirs," the email said. "We are going to negotiate with the first investor that is willing to close this negotiation within the parameters expressed in this letter."

The tactic, Garver said, amounts to an "interesting marketing campaign.

"They're literally selling pieces of their litigation like lottery tickets," he said.

"The first time Villar raised his head and said anything about this was 2001. Where was he for four years if he thought he had been defrauded out of $1 million?"

Barrick also contends the judge's ruling in its case against Villar is replete with inconsistencies.

For starters, the judge, Maria Isabel Reyes Kokisch, was an interim on the bench and had access to the case file for mere days before issuing her decision, Garver said, adding that Kokisch issued her judgment without having heard any testimony on the case.

Garver said a Chilean appellate court judge commissioned to investigate Kokisch's conduct has recommended that the justice ministry take a closer look at the case. A justice ministry spokesperson couldn't be reached to comment.

Even if it fails in its legal battle against Villar, it won't thwart Barrick from using the narrow roads to Pascua-Lama, Garver said. That's because Villar would only control mining rights to the disputed territory, not surface rights.

Garver said surface rights are all the company needs to shuttle trucks to and from Pascua-Lama.

Its battle against Villar is just one vexing obstacle for Barrick in this mineral-rich South American country.

Chile's Huasco Valley is a strip of fertile farmland that stretches several hundred kilometres from the Andes to the Pacific Ocean. A few hours south of the world's driest desert, the Atacama, water that originates near Pascua-Lama is used throughout the valley for drinking and crop irrigation.

Environmental groups charge that a chemical spill could cripple farms that grow olives, tomatoes and grapes used to make wine and pisco, Chile's iconic colourless brandy.

Some critics say Pascua-Lama may never be developed because of a host of public-relations setbacks and growing opposition to the project.

"Barrick has totally botched this," said James Whalen, an adviser to the Canadian silver mining company Silver Standard Resources Inc., who also wrote Out of the Ashes: Life, Death and Transfiguration of Democracy in Chile.

"It's a fiasco," Whalen said. "Barrick is widely viewed as the bad guy here and they don't know how to manage it.

"People here have the mindset that the environmentalists are on the side of the angels. There are very serious questions about whether Barrick will be allowed to move forward."

Barrick's plans to mine Pascua-Lama have sparked a maelstrom of debate.

The company had planned to use dump trucks to move thousands of tonnes of ice from three glaciers sitting atop some of the gold, to a larger nearby glacier nearby that wasn't exposed to direct sunlight.

Under pressure from environmentalists, Chile's mining regulators rejected that plan and Barrick has since pledged that it won't disturb the majestic glaciers.

The Andes can be treacherous terrain. Forty-five Chilean soldiers froze to death last year while on manoeuvres in the mountains, where exposure to the open air can burn the skin in seconds and sear the eyes purple.

At least three years before Pascua-Lama is to produce its first gold and silver bars, 12 people have already have died in accidents related to the mine's preliminary construction.

The most recent were four workers in 2001 who were caught in a severe blizzard high in the mountains. As snow engulfed their pickup truck, the four left the engine idling to keep warm and died of carbon monoxide poisoning, Kettles said.

In the streets of Vallenar, a bucolic city of 20,000 replete with leafy plazas and bright-coloured, clay-roofed houses, opinion over Pascua-Lama is polarized.

The unemployment rate here hovers around 12.6 per cent, nearly double Chile's national average and Barrick has said Pascua-Lama, 119 kilometres away, would create 1,500 jobs.

"This project is going to give us a chance to grow up," Edgardo Toledo, president of the pro-Barrick Rural Communities Association of Vallenar, said in an interview at the firm's office.

The world's largest gold company already has bought an ambulance and radio equipment for the nearby village of Alto del Carmen, and says chances of a chemical spill are remote.

But Marcela Castaneda, a 32-year-old English teacher whose family has lived in the city for generations, offered a more skeptical view of the project as she gave a tour of the town.

"Many people think Barrick is going to poison the valley with chemicals," she said. "For Barrick, what's the worst thing that can happen if there is a spill and Vallenar becomes a dying town? They'll have filled their pockets with money and moved on, but we will still be living here."

Every ounce of gold requires 30 tonnes of rock to be taken from the earth. Before being bathed in cyanide, which leaches the gold from the rock so it can be milled, it is broken into small pieces.

Boulder-sized chunks of waste rock are discarded. Exposed to the rain and air, sulphides in the rock react with oxygen, making sulphuric acid. That can free heavy metals like cadmium, lead, and mercury.Barrick's Ron Kettles, the Canadian-born manager of the Pascua-Lama project, said waste rock at Pascua-Lama would be kept in a pair of covered pits lined with a 1.5-millimetre to 2-millimetre membrane that, he said, "You couldn't pierce with a knife."

Kettles said Barrick would set up intermittent emergency stations along the traffic route to deal with accidental spills and that cyanide, transported in 18-gram briquettes, could be easily cleaned up.

The Barrick imbroglio comes with the Canadian mining industry at a crossroads. For more than a year, eight federal ministries have been discussing with companies and their environmental adversaries how Canadian companies can be better held to account for their actions abroad.

A Foreign Affairs spokesperson declined to comment on the hearings or on Pascua-Lama. The ministries are expected to present to cabinet a final report with recommendations as early as this month.

Back in Vallenar, in the late afternoon shade of his small vineyard and with the sun fading fast, Rene Sandoval, a local homeowner who has spent years working in the fields near this city, likely spoke for many locals when he said he expects the Barrick mine to proceed despite the continued protests.

"It's not an easy thing to say that you should just stop mining, because that's not going to happen," he said. "But there are dangers, however, and no one should pretend that is not the case."

Chris PowellNo more no-money-down mortgages from Countrywide#1532793/10/07; 19:34:25;_ylt=AkkKAW4KkseHFYHJMzWixHLMWM0F

From Reuters
Friday, March 9, 2007

Countrywide Financial Corp., the largest U.S. mortgage lender, on Friday told its brokers to stop offering borrowers the option of no-money-down home loans, according to a document obtained by Reuters.

Loans financing 100 percent of a home's value are among those that have led to a sharp rise in delinquencies at U.S. mortgage lenders. Such mortgages below "prime" quality have resulted in losses, sales and even closures at more than two dozen mortgage lenders, analysts say.

"Please get in any deals over 95 LTV (loan-to-value) today!" Countrywide said late on Friday in an urgent e-mail to brokers. "Countrywide BC will no longer be offering any 100 LTV products as of Monday, March 12."

Countrywide joins other large lenders that will require homeowners to have at least a 5 percent stake in their homes, including Washington Mutual Inc. and General Electric Co.'s WMC Mortgage. Fremont General Corp. last month stopped making "piggyback" loans that are often used to make up 100 percent LTV loans, and last week stopped lending altogether amid pressure from regulators.

The surge in delinquencies, due to loose underwriting standards and a cooling housing market, has alarmed financial markets in part because it has happened so quickly. The bulk of delinquencies is coming from loans made last year that are as little as one month old, making 2006 perhaps the worst ever in terms of mortgage credit quality, according to analysts at UBS Securities.

Countrywide Chief Financial Officer Eric Sieracki this week said the Calabasas, California-based company will survive the downturn in subprime mortgage credit quality since it has not been forced to sell loans into a turbulent market.

Monoline lenders such as Fremont and New Century Financial Corp., which focus on subprime mortgages rather than a broader line of lending, have to sell their loans to maintain cash flows. They are going through "a very dark time," Sieracki said at a Raymond James Financial conference in Orlando, Florida.

Countrywide is the largest subprime lender, with $38.5 billion originated in 2006, according to trade publication Inside B&C Lending. But the volume makes up less than 10 percent of the total $468.2 billion originated by Countrywide last year, Sieracki said.

The general pullback in credit to riskier borrowers will take a toll on the overall economy, economists at Goldman Sachs Group Inc. said in a research note this week.

More cautious lending could cut annual new home purchases by 200,000 units in "a relatively conservative scenario," the economists wrote. Higher defaults and foreclosures of existing loans will dump more supply on the market, they added.

mikal(No Subject)#1532803/10/07; 22:01:38

Commodity Bull Takes Bearish View of U.S. Economy | | March 8, 2007 | Toronto
Jim Rogers sees $100+ oil, recession, commodities bull, outperforming loonie. See what he means when he says "they lie about these things".

GoldiloxRoger's remarks#1532813/11/07; 00:40:22

@ Mikal,

Jim's response to Greenspan's remarks make me think of the TV meteorologist who clings steadfastly to his prediction of 30% chance of rain, all through the live broadcast of their "roaming street reporter" getting completely soaked!

Like, DUH! There's nothing more comical than someone "stuck" analyzing historical data, when the real-time data is making the conclusion brutally OBVIOUS!

Besides, I give special dispensation to a guy with the cajones to do 26 thousand miles of third-world market exploration on an R100LT, with his girlfriend on another old beemer - and NO chase vehicle.

The book is called "Investment Biker" for anyone interested. Out of print, but available at Amazon or Alibris used for peanuts.

geDeepCaster's Analysis#1532823/11/07; 03:20:03

DeepCaster's analysis starts wisely; then routes into convoluted pathways.

They diagnose that inflationary recession has already started which may develop into hyperinflationary depression by the end of the decade.

Afterwards they say :
"the key to capital preservation and enhancement is to be intermittently long bonds (i.e. long-term Treasury Bonds) and intermittently short gold, silver and crude oil until The Interventional Landscape changes. And that is the third key to the puzzle: intermittently....Only when the prices of Gold, Silver and Crude Oil are at considerable risk of breaking loose from the shackles of Cartel Intervention will we see them climb, and likely explosively, to their “true market values.”"

Huh? Why not load up physical and sip my tea while the market "intermittently" gyrates?

As a side note they may have suggested a good play for the cash (anti-dollar cash, I mean) component of the portfolio. If the stock market is taken down too quickly, as DeepCaster suggests, a playable panic bottom may occur; or may be not!

mikalNothing to see here...'cept gov't jobs#1532833/11/07; 05:15:57 February Jobs/Employment Data | Mish's Global Economic Trend Analysis - Friday, March 9, 2007 - Mike Shedlock/Mish
mikalHard assets a harder challenge#1532843/11/07; 06:14:47

Lowest production of gold in years, but value is up - Melbourne Age - Business - 03/11
mikalDoctor's "misadventures" show waste through years of experience#1532853/11/07; 08:50:47

By: Roderick T. Beaman
Over the years, I' ve witnessed and read about a number of events that have left an indelible impression on me about the welfare system. In no particular order, here they are. I leave the reader to arrive at his own conclusions.
When I was an intern, on my first surgical rotation, I was given the duty of discharging a post-surgical female. The surgeon instructed me to tell her to take a good general vitamin. When I told her, the patient demanded a prescription for it. She was actually indignant, saying "I'm on welfare. I shouldn't have to pay for it." When I told the attending that she was demanding a prescription, he told me to tell her that vitamins weren't covered. He told me that he'd be damned if we should have to pay for something like that. She, grudgingly, accepted.
For a while during the 1960s, the welfare department of New York City was having trouble finding living quarters for their clients. So, they put them up in hotels. And if they couldn't find a spot in just any old hotel, why they'd put them up at The Waldorf-Astoria! When one welfare client was asked how she felt about living at one of the most expensive hotels in the world, she responded, "The maid service could have been better." Esquire Magazine gave it a dubious Achievement Award for the year with the caption, "What do they want? What do they really want?"
When I used to work the emergency room, I'd often treat patients or their children. It wouldn't be unusual to later go to some neighborhood Formica table top restaurant and see the mother working as a waitress. She was working 'under the table', as the saying goes. She wasn't supposed to be receiving any wages at all. At least give her credit for trying to earn something but, if she had been found out, she would have had her monthly allowance reduced.
Welfare patients used to come to the emergency room for routine medical visits. Our hospital had no contract with the welfare department, so they'd pay the physician nothing for the visit because they maintained that it should have been treated in an office. We'd have to treat the patient because if we didn't, the welfare department would withhold all payments to the hospital. But if the recipient called them up and didn't know what to do about some minor medical complaint, they'd tell him to go to an emergency room.
One day, I was looking out one of our windows overlooking the parking lot, when a Lincoln Town Car pulled up. A woman, wearing an ankle length fur coat, got out and walked to the back entrance. I said to myself that she was on welfare and was coming to the E.R. for a medical problem for which we'd get paid nothing. .
Sure enough, a few minutes later, I heard the receptionist's typewriter tapping. When she handed the patient's information sheet through the window, I looked at it and could tell by the case number that she was on welfare because of ADC (Aid to Families with Dependent Children). I asked the receptionist to get her case card so I could look at it. She had five children with four different last names and she had a fifth. That meant that she had five children by four different men who were either contributing nothing or nearly nothing to the costs of raising them. So, it fell to the taxpayers.

I knew a couple who got divorced because they couldn't afford health insurance for themselves and their three children. When they divorced, she immediately qualified for ADC. He worked but had no health coverage. Three or four nights a week he'd stay at the house with her and the other nights, sleep elsewhere. He couldn't stay all the time, because if it was discovered, she'd lose the welfare coverage.
I know a woman who was sent to optometry school while on ADC.
I know another woman who was went to hairdressing school while on welfare, after she had a child out of wedlock. Since she graduated, she has never worked a day as a hairdresser.
Another patient brought her son to the E.R. while I was an intern, and handed him to us, lifeless. We tried to resuscitate him but he was Dead On Arrival. She broke down into tears when we told her of it. She sat in the E.R. crying that 'I only have six kids, now.' The more children the recipient had, the higher her monthly grant.
We used to submit our payment claims for medical services on IBM cards. We'd often have the cards returned to us for signatures, usually the physician's. One colleague often told the story of how he had one returned and said, "Let's see if they'll pay it, if I sign it 'Donald Duck'." He signed it 'D. Duck', sent it in and, sure enough, he got paid.
In my private practice, for a long time, I refused accept welfare patients because of the bureaucratic snafues and the length of time, often three or four months, that it took to get paid anything, that was if you got paid at all. It wasn't unusual for them to 'lose' a bunch of claim forms.
One of the departments at the hospital, had a woman who did volunteer work and was on Rhode Island Disability. They asked me to treat her for her back problem and I relented. I treated her at the hospital and she came to my office. After I treated her, she asked me how I thought she would be. I told her that I thought she was over the worst of it but she might have some more pain, but probably much less. She thanked me, saying that she was glad because she was going to Bermuda the next week and she didn't want it to ruin her trip.
We had another patient who was on General Public Assistance (GPA). GPA is usually for some type of general problem, often mental such as retardation or psychosis, that renders the client incapable of work. This one patient had a brown belt in karate, yet he was on GPA. You should ask why someone with a brown belt in karate shouldn't be capable of some kind of gainful employment. He was what we call a frequent flier. He'd come in regularly for some kind of chronic problem that should have been seen in an office.
One time he came in with his girl friend who had no coverage. The physician, Bert, a no nonsense kind of a guy, examined her and gave her a prescription. The Karate GPA Kid came in and asked Bert to give him a prescription on a welfare form in his name because he could get it for no charge. Bert threw him out and called the welfare department to report it as fraud. The woman there asked him why they were bothering them for something like that.
There was another woman, a frequent flier, who had an asthmatic son. He was truly sickly but the mother used to bring him in on a Friday night to have him admitted so that she and her boy friend could take off for the weekend. She did it every five or six weeks. I fell for it a few times but finally wised up. This one weekend, she brought him in and I told her that he wasn't sick enough to admit him.
She went off on a sob story about how it was too much for her to take care of him. She might have to stay up all night with him, crying for dramatic effect. I told her, look lady, I have four kids and many a night my wife and I spent walking the floors with one or more of them, so her sobs fell on my deaf ears. She didn't like it but shut up. She went out into the waiting room as her boyfriend arrived with his suitcase packed. So when she told him about her son not being admitted, he got mad.
These are some of the misadventures we had over the years in just this one man's experience with welfare. Your tax dollars at work.

"Published originally at : republication allowed with this notice and hyperlink intact."
Mail this article to a friend(s) in two clicks!
Dr. Roderick T. Beaman is an osteopathic family physician practicing in Jacksonville, Florida. He was born in New York City and attended New York University as an undergraduate. He is a published poet, on-line columnist and is a recipient of a 2003 Ron Paul Liberty in Media Award. He has written an un-published novel about the abuse of government power. He is a regular columnist for Ether Zone.
He can be reached at: This email address is being protected from spambots. You need JavaScript enabled to view it.
Published in the March 9, 2007 issue of Ether Zone.
Copyright © 1997 - 2007 Ether Zone.
We invite your comments on this article in our forum!

mikalFresh capital flows may stagnate, become repellant#1532863/11/07; 09:11:55,22606,21363195-913,00.html Trillion-dollar problem for China - AdelaideNow - March 11, 2007
Short synopsis of China's new fund, new direction in thinking and investment ventures abroad.

mikal(No Subject)#1532873/11/07; 10:15:52 Greenspan is Wrong: Yields Say Recession Risk is 50% - Bloomberg | March 11, 07
Up is down, more is less, left is right are
truisms of a lending trade that seems inimical to stable interest rates and honest accounting.

GoldiloxDoctor's misadventures#1532883/11/07; 11:53:04

@ mikal,

It's not too hard to come up with stories about gov't assistance abuse, but they all pale in comparison to the abuse of government funds by the military and Homeland Security establishments - if only because the of the size differential in their budgets. A full 30% of the Iraq reconstruction money (many billions) just "went missing". Eighty-five percent of the New Orleans refuse disposal money (hundreds of millions) was "absorbed" by layers of sub-contracting, according to the OMB. As with Nancy Grace and her ilk, the press spotlight is typically pointed at the individual abuser, and away from the corporate abusers, who reap much more.

Let's face it. At 95% dollar depreciation over 94 years, and loan reserve requirements all but a fiction, the banks have received the most "government assistance" of all. Lest we forget, they also received a free gift of confiscated gold in 1933 that was almost immediately "revalued" from $20 to $35.

While there is no doubt, also, that assistance programs (individual, military contractor, or relief contractor) do a lot of good, those who suggest that they become breeding grounds for fraud and waste by the nature of their very size have a good point. Only a week before he was silenced, Dr MLK talked publicly about the HUD fraud (in the TRILLIONS) that was "rediscovered" by Catherin Austin Fitts 20 years later.

But I find it most interesting that the most staunch supporters of "the survival of the fittest" welfare attitudes are the very same people who cringe at the thought of that theory being taught in their schools!

Reagan, who advocated small government, while accelerating spending more than any previous president except Roosevelt, had an interesting platform, but was totally inept at implementing it, since his support base was strongest on the military contractor "gravy train".

Unfortunately, besides Dr. Paul, the last Congressman who meant it when he talked about government limits was Davy Crockett, a LONG time ago.

Thoreauly@ mikal re: recession#1532893/11/07; 12:15:21

Here's Deepcaster citing on the subject:

Regarding real Gross Domestic Product, (Deepcaster's choice for obtaining Real Statistics) indicated that "GDP declined" roughly 1.4% in 2006 versus the official 3.4% gain.

Similarly, Real Consumer Price Inflation, specifically,'s Alternate Consumer Inflation Measure, averaged 10.2% in 2006 rather than the 3.2% claimed by the Government Statistics masseurs. (Shadow Government Statistics January/February 2007 Edition issued February 20, 2007.)

The recent datum also reported by relates to Annual Payroll Growth: "on an unadjusted year-to-year basis, Annual Payroll Growth slowed sharply in January, 2007to 1.61% from 1.70% in December."

In that same report, summarizes our current and prospective condition: "the economic downturn already underway in the United States is an inflationary recession which could evolve into a hyperinflationary depression by the end of the decade." ominously continues: "In terms of hyperinflation, the circumstance envisioned is not one of double or triple digit inflation but more along the lines of seven to ten digit inflation seen in other circumstances during the last century. Under these circumstances the currency becomes worthless as seen in Germany (Weimar Republic) in the early 1920's and Hungary after World War II, in the dismembered Yugoslavia of the early 1990's. The historical culprit has generally been massive printing of currency…."

GoldiloxInflafla#1532903/11/07; 12:24:35

@ Thoreauly, mikal,

George Ure's estimates are similar, perhaps because he reads the same source.

As long as TPTB and the media can hoodwink the public into believing that inflation is a linear curve, the Ponzi scheme is still "ON". "Whole Life" insurance had a 30-40 year run based on those crummy numbers.

Once the public gets the hyperbolic drift, the Wall St exits will be clogged with those seeking "real" assets.

Chris PowellChina will keep buying U.S. Treasuries as it diversifies reserves#1532943/11/07; 18:02:22

By Christina Soon
Bloomberg News Service
Sunday, March 11, 2007

BEIJING -- China will keep buying U.S. Treasuries after a new state investment agency begins operations to help the nation manage its $1.07 trillion foreign-exchange reserves, central bank Vice Governor Wu Xiaoling said.

China, the second-largest holder of U.S. government debt, wants to invest its reserves to support an economy that grew 10.7 percent last year, without causing large swings in global markets. The dollar slumped 1 percent against the euro in the week ended Nov. 11 after central bank Governor Zhou Xiaochuan said he plans to diversify holdings.

Asked today in Basel, Switzerland, whether China would continue to buy U.S. Treasuries, Wu told Bloomberg News: "Yes." Wu is attending the bi-monthly meeting of central bank governors from the Group of 10 nations.

The People's Bank of China had a 26 billion-yuan ($3.4 billion) loss from exchange rate movements in 2006, according to estimates by Stephen Green, senior economist at Standard Chartered Bank Plc in Shanghai.

The new agency will seek to "maximize the profits" of the reserves, Finance Minister Jin Renqing said March 9. The central bank's Wu on March 8 said "any area is possible as long as it will ensure and increase the return of our investment."

Wu told reporters in Basel that a timeframe for setting up the new reserves agency had yet to be set. "It's still under preparation," Wu said.

China is still studying what the agency will invest in, she said.

Wu said former Vice Finance Minister Lou Jiwei is leading a team in the preparations of the new agency. Lou was on March 6 promoted to deputy secretary general of the State Council, the cabinet.

China is unlikely to diversify "massively" away from U.S. Treasuries to prevent the yuan from strengthening, Jan Lambregts, head of research at Rabobank International in Hong Kong, said in an interview today.

The central bank buys dollars to prevent the value of the Chinese currency from rising from the inflows of export earnings. Diversifying away from U.S. Treasuries would mean selling dollars, Lambregts said.

"They have a policy that they will allow gradual appreciation of the yuan, but no more than that," Lambregts said. "They don't want to see the dollar crash. I continue to see the Chinese as substantial buyers of U.S. Treasuries."

The trade gap swelled 74 percent last year, driving reserves to a record. The surplus and China's foreign-currency holdings have left the economy awash with cash, making it difficult for the government to slow lending and investment to curb asset bubbles.

The yuan has been allowed to gain by as much as 0.3 percent against the dollar either side of a so-called central parity rate since the end of a fixed-exchange rate regime in July 2005.

The central bank calculates a daily rate by taking a weighted average of quotes from commercial banks designated to act as market makers in the currency.

U.S. Treasury Secretary Henry Paulson on March 8 urged China to reduce control over the exchange rate.

Some officials from the U.S. and Europe deem the more than 6 percent yuan appreciation since China dropped a dollar link on July 21, 2005, insufficient to balance the world's lopsided trade. They say the Asian nation deliberately keeps an undervalued currency to benefit Chinese exporters.

China will develop its yuan-denominated corporate bond market this year, Wu told reporters.

"That's part of the broader push to develop domestic financial markets, and a well-functioning bond market is at the heart of such a new financial system," Rabobank's Lambregts said.

The central bank in February ordered lenders to set aside more money as reserves for the fifth time in eight months. Lenders must set aside 10 percent of deposits, up from 9.5 percent.

The central bank has raised its benchmark interest rate twice since April. The current interest rates are "appropriate," Wu said.

The nation is trying to slow investment and lending to curb inflationary pressures and asset bubbles in property and stock markets. The economy expanded 10.7 percent in 2006, the fastest pace in 11 years.

Premier Wen Jiabao on March 5 said China is seeking slower economic growth of 8 percent this year. Ma Kai, director of China's top economic-planning agency, the National Development and Reform Commission, on March 7 said the target is just a guideline.

CometoseCHina #1532953/11/07; 19:15:18

Maybe China will become the 52nd State or one of U S protectorates
GoldiloxChina's reserves#1532963/11/07; 20:48:49

Let's see, they want the Yaun to remain low, but they want the inherent value of the reserves that are backing it to increase "profitably".

Am I the only one that sees the contradiction here?

How can their value of their currency NOT rise if their reserves compound their own value?

melda laurewhat?#1532973/11/07; 23:06:39

Yes. what's the worry? The US doesn't worry about its currency becomming too expensive- we have a printing press for that.
TownCrierGold likely to remain in trendy for years to come#1532983/12/07; 05:29:43

(The Canadian Press) -- The rise in the price of gold is often attributed to world political factors, such as Iran's defiant stance on uranium enrichment.

But even when world political tensions concerning the Middle East eventually subside, there is one underlying cause - the re-pricing of U.S.-dollar assets because of that country's deficits - that is likely to continue to keep precious metals in an uptrend for years to come.

It's not just gold and silver that have been affected. The U.S.-dollar prices of many metals have climbed dramatically.

Countries that have these "hard assets" like Canada have seen their currencies appreciate against the U.S. dollar.

Even the rise in real estate prices worldwide can be traced to some degree to people's expectation that an upward swing in inflation, in other words, a devaluation of paper assets, is the natural consequence of the severe U.S. government and current account deficits.

...the attraction of U.S. assets has been wearing thin. Holders of U.S. dollars worldwide, including some central banks, are instead now choosing more often than before to accumulate gold or alternative currencies such as the Euro.

It's just common sense. Why should they continue to prefer U.S.-dollar assets when their value is steadily dropping against virtually everything else?

...The process is likely to continue for many years to come, and precious metals will be among the beneficiaries.

^___(see full text at url)___^

A rare presentation from the media.


slingshotNews on the US Dollar#1532993/12/07; 08:22:11

The Condition of the Dollar

By Lindsey Williams

There is so much to touch on regarding the dollar this month, I hardly know where to start. Regardless of where I begin, the news is not good and affects all of us.

First on our list is China. They have now announced that they are refusing to accept American Corporations purchasing into their stock market any longer as they did in the past. China also said that they are no longer going to be purchasing our securities as they have in the past, including bonds and T-bills. China's decisions and subsequent announcements at the beginning of the week has sent a panic across the World's markets.

Additionally, OPEC met recently and they have also stated they will be diversifying into other currencies instead of just the American dollar. They will now begin accepting other currencies and limit the trade of oil via the American dollar.

March 21st 2007 will be one of the most significant dates this month. Iran has outlawed the American dollar and will put anyone in jail that uses it in their country after that date. They have the ominous notoriety of being the first nation in the world to do such a thing. The real issue in Iran is NOT nuclear, but rather the decision to not use the American dollar for trade and the sale of oil. On the heels of Iran's decision, North Korea has followed suit and also outlawed the use of the American dollar in their country. Finally, Malaysia the next day did the same thing.

Central banks around the world are increasingly diversifying their reserves, including cutting holdings of American dollars, according to a survey sponsored by Royal Bank of Scotland Group PLC, the U.K.'s second-largest bank. Italy, Russia, Sweden and Switzerland have made "major adjustments" in foreign-exchange holdings favoring the Euro and the British pound, according to the poll conducted by Central Banking Publications Ltd. between September and December. "Central banks are open to saying they've been diversifying to improve returns and reduce exposure to any single currency," said Sean Callow, senior currency strategist at Westpac Banking Corp. in Singapore. There's no doubt that when they say 'diversification' they mean selling dollars.

Last week a friend of mine told me they called their bank president in Vancouver, BC and he agreed with everything I have been saying about the dollar. What amazed me the most was her comment that he told her his bank is currently making preparations for the crash of the American dollar!

My dear friends, I urge you to structure yourself and get out of the liquid dollar immediately. I suggest that you get out of stock markets and into international hard assets such as real estate, gold and other assets.

Thoreauly"Gold nanorods assemble themselves"#1533003/12/07; 09:22:08

"Rice University chemists have discovered that gold nanorods spontaneously assemble themselves into ring-like superstructures. The finding could potentially lead to the development of novel nanodevices like highly sensitive optical sensors, superlenses, and even invisible objects for use in the military.
Chris PowellChina promises more market liberalization, including gold#1533013/12/07; 10:42:49;_ylt=AuiGiQRWCIFzRLFiii.wzkO573QA

Big Trade Surplus Overshadows China's Reform Pledge

By Eadie Chen and Tamora Vidaillet
via Yahoo News
Monday, March 12, 2007

BEIJING -- China pledged on Monday that 2007 would be another year of extensive financial reform but said there was no quick way to bring down its record trade surplus.

Central bank governor Zhou Xiaochuan said China would pursue reforms in areas including the exchange rate regime, interest rates, foreign exchange derivatives, and the gold market.

In a wide-ranging statement and accompanying news conference, Zhou set out the sort of market-orientated reform agenda that U.S. Treasury Secretary Henry Paulson urged on China during a keynote speech in Shanghai last Thursday.

But on the emotive issue of China's trade surplus, which is stirring protectionist sentiment in Washington, Zhou said the solution lay in deep-seated structural reforms that, by definition, would not have an impact overnight.

"The current trend of imbalanced trade will take some time to be adjusted and addressed," the central bank chief said.

As if to underline his point, China later reported a trade surplus for February of $23.76 billion, three times bigger than expected and the second-biggest monthly total on record.

That took the rolling 12-month surplus to a record $205.2 billion from $183.9 billion in January, providing fresh ammunition to U.S. critics who say China is deriving an unfair trade advantage by holding down the value of its currency.

Zhou said China would introduce more flexibility to the yuan, which has gained a further 4.7 percent since it was revalued by 2.1 percent in July 2005 and allowed to float in managed bands.

The central banker also promised that China, which retains strict capital controls, would let more money flow abroad.

But he added: "The most effective way of addressing imbalances in international payments is to enact policies aimed at bringing about structural adjustments to the economy. First is to encourage domestic demand, particularly consumption and growth in the services sector."

Sharing the podium with Zhou, Commerce Minister Bo Xilai said China was not pursuing a big trade surplus for its own sake. But he, too, cautioned against expecting instant cures.

"The trade surplus does not come about solely or mainly from trade but a result of the overall pattern of the industrial structure and international economy," he said.

The measures outlined by Zhou mark a further step toward a greater role for market forces in an economy that remains a mixture of unbridled capitalism and unreformed state planning.

In the same vein, parliament later this week is due to pass the first law enshrining private property rights since the Communist Party took power in 1949; it will also level the playing field for foreign and domestic firms by unifying the corporate income tax rates they pay.

Zhou said the central bank was studying introducing more currency derivatives so banks and firms can hedge the risks that come with a freer-floating exchange rate.

China would actively push to liberalize interest rates so the cost of money -- the most important price in any economy -- is determined by market supply and demand and responds to the monetary policy decisions of the central bank.

To reduce the dominant role of banks in providing finance to the economy, companies would be encouraged to issue more bonds; even China's gold market would be opened up further, though Zhou did not say how.

One of the headaches of China's huge trade surplus is that it floods the banking system with cash, and Zhou said the central bank would remain active in mopping up the excess money, which it fears will fuel a rebound in investment or speculation in shares.

Since last June Zhou has already increased 5 times the proportion of deposits that banks must tie up in reserve at the central bank, instead of lending out, and he said further increases were on the cards in the months ahead.

Zhou touched only briefly on the new investment agency that China is creating to help manage its $1.07 trillion in reserves.

"When reserves are high, the considerations involved in managing foreign exchange reserve portfolios may vary and there may be some adjustments," Zhou said.

"For example, when reserves are high, you may invest more in long-term assets and there might be some shift in the balance of risk and security of the products you invest in," he added.

melda laureWhat's a poor iranian saver to do?#1533023/12/07; 13:08:07

@ Sir Slingshot.

Outlaw use of FRN's in-country? That only forces all the FRN's into hiding, or into the state banks.

Will the state bank be switching to euro or other alternative clearing currencies Ex-country? Moreover, will there now be a rise in demand for euro notes in these anti-dollar nations? The use of paper dollar notes in these countries persists for a reason; therefore, if they can't have dollars, what is the next best thing? (and is it yellow and shiney?)

Topazconflagration averted!#1533033/12/07; 14:04:54

Seems just after 3pm today we had a minties moment where "everything" went south hard.
Thank God management were on their toes eh?

Topazcause and effect.#1533043/12/07; 14:26:40

Looks as if someone bought a few 10's to market circa 1440 triggering an across the board(s) adjustment.

Markets are VERY skittish at present.

Topaz...further,#1533053/12/07; 14:48:37

The thing to take away from this afternoons little flurry (assuming I've got the timelines correct) is that in an SM rout, we'd expect the "flight-to-quality" to show up in Bonds ...right? So where is the retreat path when the so-called "quality" itself sells off?
If today's action is any sort of harbinger, the next stop after quality is "VAPOR", as it didn't show up/green ANYWHERE!

flow5crime update#1533063/12/07; 16:33:29

channel 5 spotlighted recent gang related wars tonight. 12th street (the old school, lead by a woman who has murdered 6 people), 31st street & 51st street gangs have had 4 battles in the last week. police confiscated dick tracy-like guns with 100 round clips. It's all about money made from rap music. A rapper was murdered. then revenge, & retaliation, until they are caught...
flow5Hey! I'm not chicken little!#1533073/12/07; 16:55:34

The Fed's technical staff is antagonistic towards the discussion of member commercial bank adjusted "free" legal reserves. Just review their research papers. Fed speak on bank reserves is heresy. Heaven forbid economists debating anything other than the proper level of the federal funds rate, which is supposedly consonate with the proper level of the adjusted monetary base [sic]. Richard Anderson (the Fed's guru on the adjusted monetary base and reserves) said no one at the Fed watches legal reserves.

However, the money supply can never be managed by any attempt to control the cost of credit. And the fed funds "bracket racket" is responsible for the boom bust characteristics of our economy since 1965.

I give you freely what was given me.

It is mid March.

USAGOLD Daily Market ReportPage Update!#1533083/12/07; 17:48:46">
The Daily Gold Market Report has been updated.

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

MONDAY Market Excerpts

March 12 (MarketWatch) -- Gold futures ended a volatile session Monday with a modest loss, pressured by uncertainty over global precious-metals demand and falling oil prices. Even so, gold still managed to finish above the $650-an-ounce level for a fourth session as dollar weakness and declining supplies of the metal provided support.

Gold for April delivery fell $1.70 to close at $650.30 on the New York Mercantile Exchange. It traded between $647 and $654.30 for the day, but it has closed above $650 in each of the trading sessions since Wednesday.

On the currency markets, the dollar declined against major rivals on Monday, raising the prospect of gold demand and providing some support for the metal's prices ahead of key economic data to be released later in the week.

The dollar was last down 0.6% at 117.61 yen, while the euro rose 0.6% at $1.3188.

Oil's weakness had contributed to gold's decline Monday. Crude futures fell near their lowest level in three weeks, with warm weather in parts of the U.S. leading heating-fuel prices lower and key oil producers unlikely to take any action to stem the slide in prices at a meeting later this week.

But all things considered, the decline in the dollar, Australian supply slumping, a Citigroup report calling for $700 gold soon and news that Buenaventura, a large gold mining company from Peru, has reduced its hedge book by nearly 500,000 ounces in the first quarter to 1.45 million ounces are "all very market positive," said Blanchard's Neal Ryan.

"After the gyrations of two weeks ago and the rebound and consolidation last week, this week may well see some more direction as each metal starts to trade its own fundamentals more," said William Adams, an analyst at

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

USAGOLD / Centennial Precious Metals, Inc.You are invited to join the NewsGroup. Enjoy a review the archives here to see what you've been missing#1533093/12/07; 18:10:47">join the newsgroup
flow5The "Ms"#1533103/12/07; 18:11:11

There has always existed professional sanction for a variety of bias and ignorance:

1)For example, MSB's balances in the MCBss were designated as interbank demand deposits (IBDD's –balances maintained by customer banks in correspondent banks), presumably because MSBs were called banks (with the exception of 6 MSB banks that had MCB regulations) and were insured by the FDIC and not the FSLIC (and not counted in M1). At the same time S&L's deposits were insured by the FSLIC and their balances in the MCBs were not designated as IBDDs (were counted in M1); neither institution had the right to hold deposits transferable on demand, without notice, and without income penalty (the legal basis for becoming a MCB), prior to the DIDMCA; both were the customers of the MCBs; and neither had REQ Q restrictions prior to 1965.
2)From the standpoint of monetary authorities, charged with the responsibility of regulating the money supply, none of the current definitions of money make sense. The definitions include numerous items over which the Fed has little or no control (e.g., M2), including many the Fed need not and should not control (currency). The definitions also assume there are numerous degrees of "moneyness", thus confusing liquidity with money (money is the "yardstick" by which the liquidity of all other assets is measured). The definitions also ignore the fact that some liquid assets (time deposits) have a direct one-to-one relationship to the volume of demand deposits (DDs), while others affect only the velocity of DDs. The former requires direct regulation; the latter simply is important data for the Fed to use in regulating the money supply.
3)Money should be defined exclusively in terms of its means-of-payment attributes. The present array of interest-bearing checking accounts has confused the distinction between means-of-payment accounts and saving-investment accounts and created a dilemma as to what portion, if any, of these interest-bearing accounts should be considered as savings. This dilemma is resolved if transactions velocity is taken into account; i.e., M1 is analyzed in terms of monetary flows (MVt). No money supply figure standing alone is adequate as a guide to monetary policy.
4)It is inaccurate to exclude the Treasury's General Fund Account from the assets included in M1. No one has established any unique price effect of federal oulays as compared to state and local government outlays, or expenditures by the private sector. Of course, the shifting of funds to and out of the Federal Reserve banks has a dollar for dollar effect on member bank reserves, but that is another problem that can be, and is dealt with through open market operations.
5)It is ironic that professional economists, who confuse the supply of money with the supply of loan-funds, conclude that increases in "L" are inflationary. The conclusion is tantamount to saying, "don't save money" as savings (which we don't have enough of) adds to "L" and therefore has an inflationary bias, when in fact, savings (a large portion of "L") is evidence of money that has already been spent.
6)Monetary policy objectives should not be in terms of any particular rate or range of growth of any "M". rather, policy should be formulated in terms of desired rates of change in monetary flows (MVt) relative to rates of change in real GDP. Because of monopoly elements and other structural defects which raise costs and prices unnecessarily and inhibit downward price flexibility in our markets, it is probably advisable to follow a monetary policy which will permit the rate of monetary flows to exceed the rate of change in real GDP by c. 2 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 (there is evidence to prove 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.

flow5The importance of M3#1533113/12/07; 18:13:14

CB disintermediation is not, and has not been, predicted on interest rate ceilings. Disintermediation for the CBs can only exist in a situation in which there is both a massive loss of faith in the credit of the banks and an inability on the part of the Federal Reserve to prevent bank credit contraction, as a consequence of currency withdrawals. The last period of disintermediation for the CBs occurred during the Great Depression, which had its most force in March 1933. Ever since 1933, the Federal Reserve has had the capacity to take unified action, through its "open market power", to prevent any outflow of currency from the banking system.
Disintermediation for the intermediaries-S&L, MSB, CUs, MMMFs, etc., is predicated on their loan inventory (and thus can be induced by the rates paid by the commercial banks); earning assets with historically lower rate and longer term structures. In other words competition among CBs for time deposits has: 1) increased the costs and diminished the profits of commercial banks; 2) induced disintermediation among the "thrifts" with devastating effects on housing and other areas of the economy; and 3) forced individual banks to pay higher and higher rates to acquire, or hold, funds.
The monetary authorities of the Federal Reserve System, through their control over the volume of Reserve Bank credit, and the reserve ratios applicable to member bank demand and time deposits (and Eurodollar borrowings) can control the size and rate of expansion of the nonmember banks – as long as the member banks hold a substantial majority of all commercial banks assets. Since 1942, money creation is a system process. No bank, or minority group of banks (from an asset standpoint) can expand credit (create money) significantly faster than the majority banks expand.
Under the Act the legal reserves of the member banks remain the same, namely, balances in the Federal Reserve banks plus vault cash. Nonmember banks, S&Ls, MSB, and CUs ultimately (after eight years) were subject to uniform reserve ratios as these pertain to size of institution and type of deposit. But there is this important difference in reserve asset requirements: The nonmember banks can hold a part of their legal reserves in the form of interbank demand deposits (IBDDs) in correspondent member banks; the S&Ls, as IBDDs in the Federal Home Loan Banks; and the Credit Unions, as IBDDs in the National Credit Union Administration Central Liquidity Facility. Presumably in order to prevent the pyramiding of reserves, the Act requires all institutions holding these particular IBDDs to redeposit the funds in Federal Reserve Banks. Unfortunately, pyramiding will not be eliminated unless the Fed imposes a 100 per cent reserve ratio on these accounts. But the Act specifically exempts all except correspondent member banks from any reserve requirements.
There is no possible way for the Fed to get a "handle" on the money supply unless it has (and properly exercises) direct control over the volume of legal reserves, and the reserve ratios, of all money creating institutions. This the Act does not provide. The legal reserves of all money creating institutions should consist of directly held balances in the Federal Reserve banks – that and that alone. This was the original definition of the legal reserves of member banks in the Federal Reserve Act of Dec. 23, 1913 – (Owens Glass Act) and it is still the only viable definition (pre-1959 requirements pertaining to assets).
In due course, under this Act, our means-of-payment money supply (now designated as M1A by the Board of Governors) will approximate M-3.

flow5Importance of M3 cont.#1533123/12/07; 18:17:54

From the standpoint of the individual commercial banker, his institution is an intermediary. An inflow of deposits increases his bank's clearing balances, and probably its legal reserves - and thereby it's lending capacity. But all such inflows involve a decrease in the lending capacity of other banks, unless the inflow results from a return flow of currency to the banking system, or is a consequence of an expansion of Reserve Bank credit.
The source of time deposits to the commercial banking system is demand deposits, directly or indirectly via the currency route or through the banks undivided profits accounts. The financial intermediaries are the customers of the commercial banks. Money flowing to the intermediaries actually never leaves the commercial banking system as anyone who has applied double entry booking on a national scale should know. And why, from a systems standpoint, should the banks pay for something they already have. I.e., Interest on deposits? From the standpoint of the commercial banking system, CBs would be more profitable, if our legislators got the commercial bankers out of the savings business. The effect of allowing CBs to "compete" with MMFs and other intermediaries has been, and will be, to reduce the size of the intermediaries – reduce the supply of loan-funds (available savings), increase the proportion, and the total costs of CB time deposits.

Paper Avalanche@ flow5#1533133/12/07; 18:40:46

flow, while your esoteric analyses of banking history / mechanics is deserving of thanks from the standpoint of volume alone, I would like to make a suggestion that would possibly make it even more valuable to those at this forum.

At the end of each posting, try ending with something to the effect of "and here's what this means for gold (or the dollar, or inflation, etc.)." Barring a direct tie-in to the topic at hand you give the impression that you are posting just to hear yourself speak.


flow5Message#1533143/12/07; 19:12:43

1) Because of the DIDMCA of March 31st 1980, the Fed cannot control the money supply. Our means-of-payment money supply is in transition. It will eventually evolve into a figure approximating M3. Then, reporting M3 will become increasingly important.

And a larger money supply, one which the Fed has chosen to ignore, will develop into one of the best indicators for the growth of GDP, and other things being equal, rates of change in M3 will become an even better predictor of the price of gold.

2) The "Ms". or what is money? The Fed isn't an expert in their own field. The Fed only tries to control the fed funds rate, and it can only do so in the short run. It will always overshoot its money targets, because its models use income velocity (Vi/GDP). Everything that I can think of will benefit the price of gold.

Chris PowellTreasury says subprime problem is manageable#1533153/12/07; 19:13:24;_ylt=AjqrK7XAOlcnDx9nJZy3Y81v24cA

Like, what else are they going to say? "It's a disaster and we're going to have to reduce interest rates fast, devalue the dollar by 40 percent, and impose currency and credit controls"?

* * *

By Marcy Gordon
Associated Press
via Yahoo News
Monday, March 12, 2007

The government is monitoring the distress in the subprime mortgage industry and believes the current situation is manageable, a Treasury Department official said Monday.

The comments by Robert Steel, the Treasury undersecretary for domestic finance, came as concern mounted on Wall Street and elsewhere that a blowup of companies that make higher-risk home loans to consumers with poor credit or low incomes could spill over into other industries.

"We monitor the markets all the time, and are hopefully pretty aware of market conditions," Steel told reporters in response to a question. "It seems to us that the situation is a manageable one, that we're watching."

Federal bank regulators, concerned about a spike in delinquencies and defaults on subprime home mortgages, earlier this month called on lenders to exercise caution in making the loans and to strictly evaluate borrowers' ability to repay them. The regulators said the guidelines, if formally adopted by the agencies and followed by lending institutions, could result in fewer borrowers qualifying for subprime loans.

Stocks rose on Wall Street on Monday as investors looked past widening cracks in the subprime lending sector. A warning from New Century Financial Corp. about its financial woes initially overshadowed positive merger news in the trading session.

The prospect of bankruptcy loomed over New Century, the nation's second-largest subprime mortgage maker, which scrambled to stay afloat after all its bank lenders cut off funding or informed the company of their intent to do so because of its failure to make payments. Irvine, Calif.-based New Century, which already has stopped accepting all new loan applications, said there is no guarantee it will receive additional financing.

Like other subprime lenders, New Century uses short-term borrowings to finance mortgage loans it makes and buys. Also like others, the company has been having difficulty obtaining the short-term lending needed to finance the mortgages.

The subprime sector has seen a sharp decline in banks' demand for potentially troublesome loans as the housing market has slowed since late 2005, grounding the high-flying real estate boom of earlier in the decade. As long as home prices were going up, borrowers who got into trouble could just refinance or sell their homes, sparing banks from being stuck with sour loans.

The fallout from the housing downturn has spurred several subprime lenders, including ResMae Mortgage Corp., Ownit Mortgage Solutions and Mortgage Lenders Network Inc., to file bankruptcy in recent months.

On Capitol Hill some mortgage industry executives told lawmakers that the subprime turmoil is a cause for concern but does not warrant government intervention, because the financial market can weed out the problem companies.

"There's absolutely no question that there were lenders with this product that got aggressive," John Robbins, chairman of the Mortgage Bankers Association, testified at a hearing of a House Financial Services panel. Those lenders are now being punished by the market as investors abandon them, he said.

Another witness, Karen Shaw Petrou, managing partner of Federal Financial Analytics, noted that subprime mortgages account for an estimated $1 trillion of the $8 trillion U.S. home-mortgage market.

"It is a very distressing picture at this point," she said. "People forgot that subprime means higher risk, higher risk means more losses."

A liberal think tank said Monday that the federal government should take new steps to protect low-income homeowners at risk of foreclosure.

The Center for American Progress said the government should consider grants to expand mortgage aid and foreclosure prevention programs for families falling behind on their monthly payments. As many as 2.2 million families around the country could lose their homes to foreclosure in the coming years, according to a 2006 report by the Durham, N.C.-based Center for Responsible Lending.

"Congress can't wait for that many families to foreclose," said Almas Sayeed, who wrote the report for the Center for American Progress. "The economic impacts for communities and for the country could be devastating."

flow5sorry about the error#1533163/12/07; 21:31:41

I was talking to my wife. riddle me this, if these comments are tied to gold, then they should reflect the price of gold?
SmeagolNow you can have your plasstic...#1533173/12/07; 21:45:14

sss...and sspend it too! ~8-/

(news item from the Usagold Daily Market Report)

"The government of Hong Kong Special Administrative Region (HKSAR) approved Monday to issue for trial a ten-dollar polymer note this year to circulate alongside the existing ten-dollar paper notes and coins, both of which will remain legal tender.

Hong Kong Financial Secretary Henry Tang said that the move aims to find out whether polymer notes are suitable for issue in Hong Kong and whether the community will accept them.

"Experience in countries that have introduced polymer notes suggests that they are cleaner, more durable and more secure. They are also more environmentally friendly, since they last longer and can be recycled for other use. As an international and vibrant city, there is a need for Hong Kong to explore this alternative technology for currency notes," Tang said."

(more at link)

...recyclable (cackle) other wordses, precious, when we need to add more zeroes, we can...sss... melt them down and reprint them! >8-)

Paper Avalanche@ flow5#1533183/12/07; 21:55:38

Thank you for the cliff's notes versions of your earlier posts.

Regarding your riddle, absent any direct correlation from your posts via a bridge (i.e. "what this means to the price of gold is..." or "how this impacts inflation that will manifest itself in the near term is...") to a more direct statement, much of what you have submitted reads like a textbook of interest only to those who want to know how a watch is built, not what time it is.

I do appreciate your effort in putting your thoughts together in the way that you have. However, if it is your purpose to educate / instruct those on this forum as to the import of the machinations of banking, I would respectfully ask what you intend the end result to be. Do you wish forum participants to comprehend the inner workings of central banks or how the most recent actions by said central banks will affect them (and what actions they can take to best position themselves for a potential outcome)? I would submit that the latter would be the better desired outcome for posters at this forum.

My wife has called me away as well. I await your response.


Topaz@smeagol re; polymer.#1533193/12/07; 22:23:52

The first poly notes were these, way back in '88. Their launch was not entirely without mishap though as the first batch had to be withdrawn due to a glitch with the holographic window as I recall.
I've got some AA prefix ones somewhere about the place and am told they are quite valuable nowadays ...fetching about $7US EACH!

flow5for what its worth#1533203/12/07; 23:15:40

flow5 (2/26/07; 14:34:35MT - msg#: 152672)
Suckers Rally
If gold doesn't fall, then there's a new paradigm. The drop in member commercial bank adjusted "free" legal reserves is unprecedented.
flow5 (2/22/07; 19:08:03MT - msg#: 152471)
Golds Course
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.
This isn't fool's gold. But then, what is the likelihood that I know something that no one else does on this planet? And what would be the chance that I would share it? No, this is a gold mine.

There is something in this more than natural -- Hamlet

GoldiloxGold path#1533213/12/07; 23:44:35

@ Flow5,

Web bots suggest we "beware the Ides", as well. Only 49 hours away on the Left Coast.

GoldiloxHistorical "rhymes"#1533223/13/07; 00:02:37

The last few posts inspired me to reference last year's Mar-Apr "gold rush".

Between Mar 25 and April 15, PoG rocketed up $180 from $550 to $730, a rather tasty 32% romp for Spot and Spike. Spike may have had the most fun, but Spot leveled out about 100 points higher on average, so romp they did.

"Historical precedent is no indication of future performance",

but then, again, why not?

GoldiloxCorrection#1533233/13/07; 02:14:07

Make that "between Mar 20 and MAY 15".
GoldiloxPOSITIVE METALS OUTLOOK #1533243/13/07; 02:18:13


"There is a good chance that metals prices move higher from current levels through at least mid-07," Citigroup's analysis suggested. "We expect copper to regain the psychologically significant $3.00/lb range in the coming months due to a combination of incremental U.S. consumption growth (rather than retrenchment), Europe and Japan continuing to turn the corner organically if modestly, solid Chinese re-stocking demand, and the supply side likely to undershoot 5.6& expectations."

"We regard the recent sell-off in commodities and emerging markets to be yet another contest between negative macro thematics and positive metals micro-indicators, such has been seen at least one per year in 2004-05-06," Hill and Wark indicated. "In each case, it has paid to dwell on the metals micro-indicators, which remain positive for copper in terms of inventories, merchant premia [prices], scrap prices, and smelter TC/RCs."

Citigroup also advised that "gold is quite likely to move to the $700/0z level or higher due to a mix of macro and supply/demand catalysts."

"Chinese resource regulatory and taxation changes, plus solid steel production growth in the 14.5% range, suggest that moly will stay above $20/lb," the analysis concluded.

TopazTheres a bit of a pattern emerging here#1533253/13/07; 03:17:39

with Bond, reminiscent of an old Pug who's had one too many bouts ...each time the bell sounds he comes out ...but at the end of the round he's more than happy to have just held station.
At this pit (0400) they're none too heavy on the punches and should reflect a droopy SM at the open. He might be able to manage a few airswings on his own account today!

Ah, but you should've seen him in his prime ...seconds out ...Ding, Ding!

Paper Avalanche@ flow5#1533263/13/07; 06:35:23

Thank you for your response and for highlighting the thesis of your posts.


flow5Mar 25 and April 15#1533273/13/07; 06:41:34

Good observation. But that period shifts slightly every year. Its parameters usually fall between 3/12 - 5/5.
flow5seasonal mal-adjustments#1533283/13/07; 07:14:52

There are 3 different ways in which monetary policy can influence current prices. In order, 1) the most dominant is the current level of reserves, e.g., Y2K, 911, etc., 2) the second is the 24 month roc of in reserves (inflation), & 3) the last is the 10 month roc of in reserves (real gdp).

The relative strength or weakness of the seasonals can be calculated by comparing the same period of time in each of the preceding 20-30 years. However, this is deceiving, and it simply shows "asked" prices and doesn't presage prices or how far a swing may sway.

slingshotFailing banks and subprime loans#1533293/13/07; 07:32:24

Was 24. Now 36! A place to see them all.

MKHeads up#1533373/13/07; 09:02:10,Authorised=false.html?

The New Century Financial problem has potential systemic implications. . .Also consider that the NCF problem doesn't begin and end with just that mortgage lender -- others are vulnerable. The real threat is not to the housing sector (though it will be affected) but the big banks, once again, through the web of counter-party contracts and automatically engaged reciprocal agreements. Many of Wall Street's biggest involved in this. We may get a chance to see if the counterparty system is capable of bailing itself out. . . .or not. More later.
Federal_ReservesBig trouble now - wait until unemployment spikes!#1533383/13/07; 11:19:02

The market is taking a turn for the worse as the afternoon gets underway. The Financials sector is now down sharply (-1.7%) after the Mortgage Bankers Association (MBA) recently said the rate of homes entering the foreclosure process hit a record 0.54% in Q4 and the delinquency rate on U.S. home loans jumped to 4.95% from 4.67% three months earlier. Delinquency rates rose in 49 states in Q4, foreclosure inventory rates grew in 44 states and the MBA pushed back its forecast for the housing market to regain footing from the middle of the year to the end of 2007.
968Gold in Russian reserves edges up 2.2%#1533393/13/07; 11:30:16

MOSCOW. March 13 (Interfax) - The amount of gold in Russia's state reserves rose 2.2% to 402.8 tonnes, not including gold used for swap deals, between December and March, the World Gold Council (WGC) said.

The WGC said that 2.8% of Russia's gold and foreign exchange reserves consisted of gold, unchanged from December. Russia remained 13th in the world in terms of the amount of gold in its state reserves.

mikalTermination of mirages#1533403/13/07; 12:07:55

Guest Commentary, by Michael J. Panzner

Rise of the (Selling) Machines
March 13, 2007
Michael J. Panzner is the author of Financial Armageddon: Protecting Your Future From Four Impending Catastrophes, published by Kaplan Business, and a 25-year veteran of the global stock, bond, and currency markets.
"In the popular 1984 film, The Terminator, current California governor and former actor Arnold Schwarzenegger plays a cyborg sent back in time to eliminate the mother of future leader John Connor before he could be born. Single-minded and highly developed, the robotic killer relentlessly pursues his intended prey throughout the movie, despite strong resistance from the hero's supporters, although the good guys eventually win out in the end."

"Under the circumstances, index-related selling, for example, could transform markets in thinly-traded securities that have been unusually liquid and serene into boggy swamps of illiquidity. This would spur widespread fear and even a sense of panic, along with a substantial increase in volatility, as hordes of investors scramble nervously towards the exits.

The broad use of chart-based, trend-following, and momentum-driven trading and investing strategies is also likely to exacerbate the market's woes in the face of a sustained downturn. With fear a more powerful motivating force than greed, the herding behavior that such methods naturally encourage will likely create a snowball effect that will be hard for anyone—either those diving in or those bailing out—to resist.

Other modern risk-management methods and tactics will also fan the bearish flames once former long-term bull markets start coming apart at the seams. These include..."

slingshotGold and the DOW#1533413/13/07; 13:50:49

Gold down $8.00 but the DOW down 220 points. Betcha they can not wait for the BELL TO RING. Overseas Markets looking RED. I have NO PITY for the banks selling mortages to those who should not have qualified. Can't blame people for trying to better themselves, but that predatory nature of banks and everyone is going to pay for it.

slingshotDOW#1533423/13/07; 14:06:33

Lets see how much lipstick they put on this PIG?


mikalSubtle design mutation said rare, valuable#1533433/13/07; 15:27:47

First a "Godless dollar," now a faceless one
By Chase Squires
The Associated Press
Article Last Updated: 03/13/2007 02:49:46 PM MDT
Snippit: "Denver - Mary and Ray Smith can't make heads or tails of a new presidential dollar coin they found last week. It doesn't have either.
A week after the revelation that some of the coins slipped out of the U.S. mint without "In God We Trust" stamped on the edge, the Smiths said Tuesday they found one with nothing stamped on either flat side.

It does have "In God We Trust" on the edge. What's missing is the image of George Washington on the front and the Statue of Liberty on the back. Instead, the Smith's coin is just smooth, shiny, golden metal.

"We're just so excited," Mary Smith told The Associated Press. "I'm just dumbfounded that we actually found something significant."
U.S. Mint spokesman Michael White said officials had not confirmed the Smiths' find. But Ron Guth, a professional coin authenticator in Newport Beach, Calif., said he is certain the coin is authentic.

"It's really pretty rare," Guth said. "It somehow slipped through several steps and inspections."

It could be worth thousands of dollars, maybe more, he said. The value will depend on how many similar misprints are found, but the Smiths' will always be worth more because it will be the first one to be independently authenitcated, Guth said.
The first "Godless" coins, which went into circulation Feb. 15, initially sold for $600 but were attracting bids of up to $152 on eBay Tuesday. It's not certain how many were made."

Lackluster.#1533443/13/07; 15:57:07

"Instead, the Smith's coin is just smooth, shiny, golden metal."

Choose golden metal.

GOLD FINGERThe gold finger points to......#1533453/13/07; 16:11:18

A recession!!

If I am correct recession seems to loom when the Real Estate and Mortgage markets take a hit like they are now.

I wonder if Flow5 still believes that we are 100% clear of a recession hit? I bet he has a different opinion now! If not....just wait until the unemployment figures come out.

I think a lot of these investment bankers and mortgage bankers are just trying to keep their head above water by offering new "refinancing products" and they are STILL trying to reassure everyone that the economy is good.

Well, this time around what makes will make a big difference?

The PRICE OF OIL>>>> It's still high and going to go higher. Put all these indications together and I bet you can spell out some not so happy economic results.


Buying opportunity for PHYSICAL GOLD!!!


USAGOLD - Centennial Precious Metals, Inc.2-day College Hoops Buyers' Group!#1533463/13/07; 16:19:06

A special note from Jonathan:

As most of you know, this Thursday will mark the beginning of another NCAA basketball tournament. Others may or may not know that my beloved alma-mater, Notre Dame is making its first appearance in four years as a respectable six seed. Their achievement has encouraged a generous mood.

For two days only, until the first tip off on Thursday morning, we'll be offering some very nice discounts on pre-1933 Fr. Napoleon III gold coins. (The pricing is laid out at the URL posted above.)

As an additional incentive, should Notre Dame advance to the Sweet 16, requiring two wins on their part, all who purchase 5 or more coins through this offer will be given a free Silver US Eagle!

Great discounts, and I secretly get you rooting for the Irish. Cunning... I know.

--Jonathan Kosares

USAGOLD Daily Market ReportPage Update!#1533473/13/07; 16:53:22">
The Daily Gold Market Report has been updated.

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

TUESDAY Market Excerpts

March 13 (Reuters) -- Gold futures finished Tuesday modestly lower, then extended their losses to nearly 1 percent in late electronic trade when U.S. equity markets were toppled across the board and oil fell.

US stocks fell sharply in afternoon trade, with the Dow Jones Industrial average ending down about 2 percent, all 88 components in the S&P financials index trading lower, and the Nasdaq Composite Index off more than 2 percent on news of mounting losses in the subprime mortgage sector.

"It was pretty quiet during exchange trading hours, but afterwards equities started to drop off and we're following them with the greater worries of the subprime mortgage sector," said one New York gold dealer.

Nervousness in the stock pits spread to gold investors, some of whom needed to sell out of precious metals to pay for holdings [losses] in other riskier assets, traders said.

"We believe people are liquidating gold in order to get capital together for other areas. And I think some people are just scared right now," said one trader.

The COMEX April gold contract lost 90 cents to close at $649.40, trading in a range of $648.80 to $653.50. After hours, April gold dropped $6.40, to $643.90, falling with U.S. stocks and other metals.

According to a Mortgage Bankers Association report, U.S. home owners initiated the foreclosure process in the fourth quarter of 2006 at the fastest pace since the MBA began its foreclosure survey 37 years ago.

The news undermined financial shares, the broader stock market, and then spilled over to commodities markets.

Earlier, gold moved definitively into positive territory after of a softer-than-forecast U.S. retail sales report and a Bundesbank announcement that it would not sell gold this year.

Crude oil prices, whose earlier rally pulled gold up to its session peak, reversed course, falling sharply in late trade as the stock slide rekindled worries over the health of the economy in the world's largest energy consumer. Some short-term gold players took that as their cue to grab quick profits as the day's early gains faded.

With a plethora of gold-supportive factors in the market both Monday and Tuesday, some traders said they thought gold would hold its earlier gains. But fears of loan delinquencies in the housing sector having a knock-on effect in other markets and in the economy caused some players to unload commodities, including gold.

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

melda laureCoins wihtout markings.#1533483/13/07; 20:38:29

What a clever marketing gimmick. Like those rare and fantastic mortgages with no documentation.... really a great marketing gimmick, once you examine what you have up close you see it is just a "blank", which the mint produces in large quantities and whose intrinsic value is zero- except for the dollar's worth of value that one exchanges to accquire it.

So it begins. With a good POG spanking. The lies and misdirection in subprime are just sickening.

March 9 (Bloomberg) -- Subprime mortgage bonds are falling in part because Wall Street dealers are lending less money to managers of collateralized debt obligations that buy the securities, according to investors.

Isn't that putting the cart before the horse, or perhaps, confusing the cart with the horse, and expecting the former to push the later?

Low-rated subprime mortgage bonds were ``relatively insulated'' from concerns about rising delinquencies until last month, Lehman said in March 5 report. Between August and February, spreads widened less rapidly than credit derivatives that provide bondholders protection against default.

Isn't that because the credit insurance was WORKING? This is like blaming the fire on the fire extinguisher, if only it hadn't run out of gas!

The drop in CDO demand may be temporary as rising yields on subprime mortgage bonds make it possible to offer higher yields on CDO securities.

This is like saying that the chaos in Iraq will make military recruiting easier because of the guaranteed hazard pay. Not only will there be a flood of volunteers, but on the other side of the trade, the Iraquis WANT their children to get blown up in the heavier cross fire too.

Just a bit logic challenged, but hardly unusual of late. There seems to be a lot of brave cheering going on. "We who are about to die salute you" BOSH! That would be courage. Instead these shills are saying "We who are about to watch you all get slaughtered salute your market savvy!"

Disgusting! Shameful! Cowardly!

Somebody get me a rope... I'll be back as soon as I finish cashing in my bank account at the coin shop.

And pin a medal on Doug Noland for bravery or something.

Chris PowellHousing decline, subprime mortgage crash 'largely contained,' Paulson says#1533493/13/07; 21:05:26;_ylt=AhdaPw6RzSUaK1k89J0x_bC573QA

From Reuters
Tuesday, March 13, 2007

WASHINGTON -- U.S. Treasury Secretary Henry Paulson said on Tuesday a decline in U.S. housing activity has caused some damage in subprime mortgage markets but was not hurting the overall economy.

"I continue to believe the U.S. economy is healthy," Paulson said in an interview on CNBC Television when he was asked about a big drop in the stock market.

"We have had a significant housing correction in the U.S.," Paulson added. "You can't have a correction like that without causing some dislocations. It's too early to tell whether it's bottomed. I believe it has."

The U.S. Treasury chief said it "shouldn't be a surprise to anyone that there's some fallout in the subprime mortgage market ... but it's largely contained."

Paulson said the U.S. economy was "diverse" with growth in exports outstripping imports and consumers still spending.

"Inflation would appear to be contained so again I continue to believe we are making a successful transition from an economy that was growing at an unsustainable rate to one that is growing at a more sustainable rate," Paulson said.

After hosting a day-long session on capital markets and regulation, Paulson avoided a direct answer when asked whether the threat of rampant lawsuits was driving capital away from the United States to other centers.

"We have the best capital markets in the world. They're the most liquid, the most competitive capital markets in the world and they're very important to our economy," he said.

Paulson was interviewed on a day when U.S. stock markets posted their second-worst selloff of the year.

On another issue, he was asked whether pressuring China to let its yuan currency appreciate risks potential backfire if China becomes reluctant to buy U.S. debt securities.

But Paulson, who visited Beijing and Shanghai last week, said China does not yet have a market-determined currency exchange rate and indicated he was not about to back off in demanding that China move toward one.

"They need to show more flexibility," he said.

melda laureDestiny takes no prisoners, but sometimes takes golden joyriders#1533503/13/07; 21:31:07

Gold and real estate will be here tommorrow, the only questions are in who's possession, and under how much water.

Paper is burning
Mars rises and Beckons
The stars wheeling and turning
Birthing time Reckons.

Merlin Returning
the Wizard awakend
With scholars surrounded
of courage new quickend

The birds are a flying
in snowflake formation
For winter is banished
economic deflation.

Aure Entuluva
Earth Rumbles and Shudders.
Auta i Lome
Trader's heart flutters.

A new sun arising
A vision I see
Paper is Garbage
Turn off the TV.

Derivative garbage
So dull and dreary
Cherry trees blooming
are pretty! not Scary!

The spying potato
with leveraged diction
will rot in the washout
With bloomberg's eviction.

Derivative garbage
So dull and dreary
Cherry trees blooming
are pretty! not Scary!

Capital values
ought be lovely, not cruel.
(And gold is an asset that follows that rule!)

Not the end, of course, but perhaps, the end of the beginning, the end of the title page, the passing of the prologue, and other useless preliminary stuff, and perhaps in time the inaguration of something better.

Try not to get splashed with too much pidgeon blood.

TownCrierCommodities still in bull market -- at least 10 more years says Schroders#1533513/14/07; 01:29:03

HONG KONG (Reuters) - Commodities are in the early stages of an extended bull market, especially agriculture where price increases have only just begun...

Christopher Wyke, emerging markets debt & commodities product manager at fund management firm Schroders, which managed about US$244.1 billion worth of assets last year, said the bull run would last at least another 10 years, driven by constraints on new supplies and rapidly growing demand.

"Over the last hundred years, commodity bull markets have lasted on average for about 20 years. And for a very simple reason, it's only when prices rise that people invest in new production and that takes a long time to come onstream," he said.

...Wyke said commodities also provide diversification from assets like equities and bonds.

He said what is typically bad for equities, including war, political uncertainty and rising inflation, have historically been positive for commodity prices, so they provide a good hedge.

"Historically, commodities are still cheap," he said.

^___(from url)___^

Historically, paper is overvalued.

What is your savings worth? Can it reliably command real wealth at any given moment? Better still, make the right choice and your savings will already BE real wealth. Among tangibles, choose gold for durability and liquidity.


TownCrierBundesbank confirms it will not sell any gold reserves this year#1533523/14/07; 04:59:25

St. LOUIS ( -- Bundesbank President Axel Weber said today the German central bank plans no substantive gold sales in the current year of the central bank gold agreement and has made no firm decision for next year. The Bundesbank has already sold 5.3 tonnes of the 8 tonnes of gold it had set aside for gold coins.

In other news, Russia's gold reserves rose 2.2% to 402.8 tonnes between December and March, according to the World Gold Council (WGC). The WGC said that 2.8% of Russia's gold and foreign exchange reserves consisted of gold, unchanged from December.

In the last three months, Belarus has added 6.2 tonnes of gold to reserves, Kazakhstan has added 7.6 tonnes and Greece has added 3.8 tonnes. An unnamed ECB bank or banks added 14 tonnes in February alone.

RI calculates total gold sales for the CBGA year at just over 110 tonnes, on pace to end the year about 230 tonnes short of the 500-tonne quota...

^___(from url)___^

Always lost in any review of stats of this nature (CBs selling and CBs buying) is the market's unfailing appetite to absorb all physical gold brought forth under cover of the buyers' best friend -- the papergold price.


Gandalf the WhiteDon't you "LOVE IT" when entities show their TRUE COLORS ? <;-)#1533533/14/07; 09:36:11

Metals - Gold falls as investors shun risky assets amid economic weakness
Wednesday, March 14, 2007 12:49:42 PM
OF COURSE -- Gold is a "risky asset", NOT !!!

Gandalf the WhiteBEAUTIFUL WATERFALL today ! <;-)#1533543/14/07; 09:58:36

Silver FoxGandalf the White #: 153353#1533553/14/07; 10:04:18

Risky Asset…

If it is SO RISKY, why has the Bundesbank hitting the brakes on selling gold? Why are so many other CBs buying gold? Risky? This is more like "do what I say, not what I do". When the sheep wake up, they will find out that they have been screwed.


MKGandalf, my wizadrous friend, and ALL. . . . . . .Gold & Human Folly#1533563/14/07; 10:18:34

Funny you should bring up gold and risk. It's what's been occupying my mind lately and also that of Alan Greenspan and Hank Paulsen judging from this morning financial page headlines.

We live in a ultra-risky world -- much riskier than ever before and getting riskier by the day. I need not provide the litany. Those here know it well.

But what to do about it? Aye. . . There's the rub.

At the core, we all know that risk is something we must deal with in order to become successful individuals. On the financial front, we need to protect ourselves against our own faulty investments. In other words, we must protect ourselves against ourselves. We must also protect ourselves against human folly inspired by government policy. In other words, we must protect ourselves against against breakdowns in the social system. Third, we must protect ourselves against breakdowns in the private (quasi-public) financial system -- what we've come to call "systemic risk." In other words we must protect ourselves against the system. And last, we must protect ourselves against an economic breakdown. In other words, we must protect ourselves against what might be the greatest risk -- the imposition of nature on the international economy as it is cleared of the debris.

Human folly then (including our own), by far, imposes the greatest risk to our own personal well-being. By reducing the effects of human folly on our own individual lives (and those of our family), we elevate the degree of comfort and happiness in which we live. So in the end, how we counter risk is one of our most important undertakings as social individuals.

Financially, there is no surer way to cover our risk exposure to human folly, than through physical gold ownership. A strong, core holding of this benign, highly-desired and ultimately liquid substance is truly one of the keys to individual happiness. The real reason to own gold is not to make a profit. It is not to display our wealth, or to enter impressive numbers on our personal balance sheets. It is to provide peace of mind and security so that the other things of life can be more readily enjoyed. This is wealth that no one can take away from us. If one desires financial peace of mind, gold is the road that takes you there. And that, my friends, has been gold's little secret for all these centuries -- the one the central bankers, Wall Street highflyers and Beltway politicians by and large don't get -- and the reason you will never see it disappear from the well-heeled investment portfolio.

Sierra MadreFWIW: my take on where we are at this time....#1533573/14/07; 11:25:31

1. MAYBE, some people are trying to save their hides because they are getting margin calls (?) or they are otherwise pressed for $$$ cash and decide to jettison gold in order to raise cash. That MIGHT be so.


2. The most likely cause of the continuing weakness in the price of gold, responds to another cause: the Establishment is desperately trying to head off the stampeding herd which is running out of stocks, trying to head them off so as to avoid BY ALL MEANS, having the herd stampede into gold, which would be total disaster - the "R.I.P." headstone for the grave of the dollar.

The Establishment KNOWS that once the idea of buying gold takes hold amongst the herd, gold will be in four digits in a matter of days. Thus, if the stock market goes down, gold MUST be made to go down as well - "No refuge there!" is what the Establishment wants the herd to feel.

This tactic can work for a little while. If the stock market continues its decline, and the consequences of the real estate debacle go forward, plus x, plus y, plus z factors also take their toll simultaneously, there will definitely be a point below which it will not be possible to lower gold any further.

As things stand, I FEEL that gold supply, to prevent a physical price of over $640, is just not available in sufficient quantity.

Finally, fear will take over; the more perceptive among the herd fleeing from paper assets will see that gold is not falling any further, and the next stage will be a very strong rally into gold. Now add to all factors, another huge factor: an attack on Iran. If this comes to pass, I just cannot see how gold could be kept down any longer.

Aren't you glad you aren't sweating blood like those in charge of keeping gold down? Time is on OUR side, not on theirs!

Well, if I am wrong, that will be proof I don't know nuthin...


TopazThat dirty stinkin rotten ...#1533583/14/07; 11:59:57

Aggie is to blame!
Golds woes can be sheeted home to the fact that we're in off-delivery mid-month and as such coming under the influence of Bond ...PaperGold has a "distance" (time component) that is clearly not apparent with "here-and-now" Bullion, and as such waxes and wanes as an altBond.

PoG will face off against here-'n-now "Dollars" around Mar 25 as she is subjected to delivery pressures.

None of that excuses Aggie who should be much better placed at this pit.
Shes quickly descending from red-carpet status to swine-trough candidate here and if things don't improve in the coming days, I'll have to resort to name-calling ...and we don't want that, do we my sweet?

LexxGold. Physical or paper#1533593/14/07; 12:01:59

Sir Sierra Madre, Is the POG falling because of physical sales or because a Supply of New Contracts(paper) is added to the pile of short contracts on the Comex? It is my opinion that nobody knows what the true price of gold is in regards to the $dollar.If you look at the history of gold and how it is valued vs fiat currency it is pretty obvious that is should be much higher than it is in $dollars. Looking back in the archives of USA Gold and reading the posts of Another where he stated that the physical price and the paper price (Comex) would seperate makes a lot of sense. I personaly would not sell my gold for any price that has been listed on the Comex. Lexx
Topazwell, well! #1533603/14/07; 12:10:31

...the threat of name-calling had the desired effect and Aggie "almost" eked out an unch on the day ...Good dog, I mean ...Princess!
Paper Avalanche@ sierra#1533613/14/07; 12:31:33

My thoughts exactly


flow5Historical "rhymes"#1533633/14/07; 13:55:40

Goldilox (3/13/07; 00:02:37MT - msg#: 153322)
Historical "rhymes"
Goldilox (3/13/07; 02:14:07MT - msg#: 153323)
Make that "between Mar 20 and MAY 15".

Looked at some historical data: Your begin date is more accurate than mine was: "Mar 20". As of today, I would bet gold will resume its climb on this date. But I'm still sticking to an end date of: May 5.

This period varies widely over the years. The dominant senario is up 2 weeks beg. 3/20; then down 2 weeks ending 4/15; then up 2 weeks. After that I don't see a seasonal pattern until Sept.

Can't foresee a recession, no matter how you define it: the traditional 2 quarters; or declining rates of change in real gdp lasting more than a couple of months (which is more consistant with the BEA's definition).

Due to our gargantuan Federal deficit, monetary authorities will avoid any restrictive policy or tightening that would lead to significantly lower federal tax receipts.

mikal@Sierra Madre#1533643/14/07; 14:05:17

Re: "As things stand, I FEEL that gold supply, to prevent a physical price of over $640, is just not available in sufficient quantity.
Finally, fear will take over; the more perceptive among the herd fleeing from paper assets will see that gold is not falling any further, and the next stage will be a very strong rally into gold. Now add to all factors, another huge factor: an attack on Iran. If this comes to pass, I just cannot see how gold could be kept down any longer.
Aren't you glad you aren't sweating blood like those in charge of keeping gold down? Time is on OUR side, not on theirs!
Well, if I am wrong, that will be proof I don't know nuthin..."
You are RIGHT on all points except an attack on Iran is not necessary for gold to draw interest nor are TPTB sweating.
They have had ample opportunity to defend their line in the sand and acquire gold insurance before it becomes attractive. Have you seen the new Fed cartoon? It's an online reprint of an old one from 1981, released when the Fed was unsure of what to do during the currency crisis.
Among their "educational" materials for schoolchildren, this one surely stands out from the crowd, but in time it will be exactly what the crowd pines for.
I'll stick my neck out and tell you this comic book was included in yesterday's MIDAS report by Bill Murphy This letter by "Bix" started out with righteous indignation at the Fed for their comic book in which children learn inflation is created when people wish to pay more for goods and the prices just keep rising.
Take the time to laugh and then it hits you...
Read this latest comic...for some reason they had to get it out on line on 1/1/07 instead of in comic book form.
Am I losing it or does this talk about the coming gold moonshot??
OK, "The Road to Roota" was put out by the Federal Reserve Bank of Boston in 1981...basically the last time there was a currency crisis. Back then here was the news:,9171,921073,00.html?promoid=googlep
Of course the ultimate decision by banks was to rig the gold market with Rubin's gold leasing program, but that was then...this is now! Now there is no more gold/silver to sell off.
On January 1, 2007 the Federal Reserve Bank added "The Road to Roota" to their web it a coincidence?
Doubt it. Something big this way comes!

mikalLink for Fed comic#1533653/14/07; 14:22:28

Wishes and Rainbows(included in the Teachers Guide- 'The Road to Roota')link to comic reprinted online.
The 'little people' dig out of their 'colorless' world
to find the way to happiness?
Something tells me it ain't gonna come cheap.

SundeckPosting problems#1533663/14/07; 16:48:16

TownCrierSundeck, posting problems#1533673/14/07; 17:00:00

I've been getting that once in awhile, too. The good news is that I've been toiling greatly to get the site migrated over for hosting on a new server. The bad news is that that we're not quite there YET. Meaning right now.

So in the meanwhile, try splitting your intended post into two halves -- maybe you'll have success posting it in parts. It's worked for me. Strangely, SIZE isn't the issue, but rather something undetectable about the characters involved in any given post as a whole. In other words, sometimes splitting it will work, or sometimes merely editing an opening, closing, or middle sentence will do the trick, too.

Sorry for the hassle.


SundeckTest#1533683/14/07; 17:22:51

Problems posting...


Thanks TC...

The above is what I tried to send last night (after failing several times to get a longer post away).

Can't get much simpler than "Test" and "Problems posting...", but still wouldn't go.

Good luck with your debugging...


flow5forecasts#1533693/14/07; 17:29:45

It's mathematically impossible to error when forecasting. And as you might imagine, our chieftains' don't know this. They have learned their catechisms. They are both ignorant and arrogant.

There is no other way, and I continue to emphasize this. Legal reserves are the source of the money supply. It is a more accurate measure than adopting a new measure of the money supply when the old one doesn't work. Even though the transactions velocity is unknown, the development of financial innovations is at the top of the curve.

My friend, who possessed an exceptional intellect, described himself as a rates-of-change & flow-of-funds economist. The press described him as a monetarist. Friedman was his classmate in Chicago while Friedman was earning his masters, but Friedman didn't have enough money to finish so he accepted a scholarship at Columbia.

No one has ever discovered and therefore confirmed the nexus to monetary lags. These lags are "precise", unvarying, etc. in contradistinction to Bernanke and Friedman.

201.895.70.22 -0.16 2006-12-01 6.14
202.497.60.380.07 2007-01-01 6.22
92.9 -0.16 -0.09 2007-02-01 6.29
95.50.03 -0.01 2007-03-01

Feb. is over. Mar. is weak. However afterwards, it will be very hard for the Board of Governors not to exceed the monetary targets.

TopazCrier#1533703/14/07; 17:31:25

Sundeck acknowledged suggestion thought give a
Seems a of to to if insist!
K's raff found playpen?

TopazTown#1533713/14/07; 17:31:33

As hasn't your I I'd it try.
like lot trouble go but you

Notice riff have a new

Sundeck@Topaz#1533723/14/07; 17:50:04

Time, space and gramattical multiplexing seems to work...


mikalRoad markers#1533733/14/07; 17:53:47

Bank Bust & Sea Change: 3 Views
By: Jim Willie CB,
-- Posted Wednesday, 14 March 2007 -- Excerpts:
"Greenspan was responsible for creating the mess, now he leads interference for reactive policy change. He has talked about a recession likelihood, but continues to deny a spillover of the housing debacle into the real economy. More accurately, he awaits the spillover. One should regard the Greenspan role as carefully orchestrated, not by any means accidental. He has created the psychological backdrop perfectly for Bernanke to cut official interest rates. Ben needed a shock to stocks, a change in sentiment and outlook. He got it."
Mikal-- Excellent observations on the whole are the norm for Willie, and this one delivers a chunk of them. If you gather all of the accumulated evidence including
some found here, our future looks clearer and more concrete
than even many of the best laid plans...


The shocking developments are at work now, a clear testimony to a failed self-regulated inflation management scheme abusing a fiat currency, just as Von Mises warned:

MONEY SUPPLY GROWTH IS AT 10% (according to USGovt statistics)
PRICE INFLATION IS AT 10% (disregard USGovt statistics)
ECONOMIC GROWTH IS AT MINUS 1.4% (disregard USGovt statistics)

The Shadow Government Statistics folks do great work. Here is their view of reality, after removing what they call a steady stream of gimmicks in USGovt official economic statistics. They eliminate the garbage methods known as substitution, quality improvements, geometric averages, double counting, cockeyed weights, and more. We are in the midst of a queer mixture of severe monetary inflation, damaging high price inflation, yet an economic recession, weighed down severely by a housing bust and a mortgage finance crisis. Yet, the USGovt & Dept of Treasury & US Federal Reserve tag team are pumping money from the printing press like there is no tomorrow, in utter futility. They had better push harder on the accelerator, since the crises and shocks have only begun. We are in for a wild ride. See their website at ( )."

Mikal-- Further snips can't do justice to some ideas on bonds, stocks, currencies and commodities he's developed IMO.
And there's something for just about anybody here, even where our opinions diverge(I'm not 100% with Willie), because of some sound points of reference, data and conclusions here.


One highly significant topic barely touched upon is the shock wave to the credit spreads and the direct linkage to USTBonds. Long-term interest rates will be falling (NOT RISING) even though price inflation abounds."

TownCrierTopaz, you make a good point#1533743/14/07; 17:58:29

A nice reminder to me to work harder on my communication skills.

Acknowledging that I hadn't even considered that a post had latitude to be halved as you have so masterly demonstrated, I think this lesson shall have the effect to slow my future output to a standstill. ("And there was much rejoicing.")


mikal(No Subject)#1533753/14/07; 18:03:46

Foreign love for U.S. assets at risk in subprime drop - Reuters - Snippit:
"Securitized consumer debt like ABS and MBS have been the Gatorade quenching the global thirst for yield," added Pomboy, referring to asset-backed and mortgage-backed securities.

Figuring how much juice foreigners put to work in these CDOs and collateralized loan obligations or other exotic derivatives is difficult to pin down, said Peters and Pomboy.

U.S. Treasury data show in 2006 that 81 percent of net foreign inflows were in so-called agency debt sold by Fannie Mae (FNM.N: Quote, Profile, Research) and Freddie Mac (FRE.N: Quote, Profile, Research) and U.S. corporate bonds, which include ABS and MBS. These are securities that are packaged in CDOs."

SundeckTesting, testing...#1533763/14/07; 18:10:40

My daqughter sent this to me a few months seems strangely relevant now...

>>fi yuo cna raed tihs, yuo hvae a sgtrane mnid too.
>>Cna yuo raed tihs? Olny 55 plepoe can.
>>i cdnuolt blveiee taht I cluod aulaclty uesdnatnrd waht I was rdanieg.
>>The phaonmneal pweor of the hmuan mnid, aoccdrnig to a rscheearch at
>>Cmabrigde Uinervtisy, it dseno't mtaetr in waht oerdr the ltteres in a
>>wrod are, the olny iproamtnt tihng is taht the frsit and lsat ltteer
>>be in the rghit pclae. The rset can be a taotl mses and you can sitll
>>raed it whotuit a pboerlm. Tihs is bcuseae the huamn mnid deos not
>>raed ervey lteter by istlef, but the wrod as a wlohe. Azanmig huh?
>>yaeh and I awlyas tghuhot slpeling was ipmorantt! if you can raed tihs forwrad it.

Damned server still won't accept the post I really want to send!


Chris PowellGoldman Sachs pays $2 million to settle 'naked' short-selling case#1533773/14/07; 18:18:51

By The Associated Press
via Yahoo News
Wednesday, March 14, 2007

WASHINGTON -- Goldman Sachs Group Inc.'s clearing unit has agreed to pay $2 million in civil penalties to settle allegations that it allowed customers to illegally profit by selling securities short just before public offerings of stock, regulators said.

It marks the first settlement of a Securities and Exchange Commission and NYSE Regulation Inc. case alleging that a prime brokerage firm played a role in a type of abusive short-selling practice that has prompted some companies to launch a high-profile campaign against "naked" short selling. That involves selling borrowed shares without having first borrowed the shares.

"That is an important case and it reflects our interest in this area," SEC Chairman Christopher Cox told reporters after a speech to the U.S. Chamber of Commerce. He declined to say if the SEC is investigating other Wall Street firms for naked short-selling abuses.

A Goldman Sachs spokesman declined to comment. Goldman Sachs Execution & Clearing LP, one of the biggest clearing firms on Wall Street and previously known as Spear, Leeds & Kellogg, settled without admitting or denying wrongdoing.

The regulators said that customers of the Jersey City, N.J., clearing unit made their trades through the firm's direct access system, called REDI. Customers who were selling securities short -- or selling borrowed securities in a bet on falling stock prices -- had instead used the system to mark their trades "long," regulators said, indicating that they were selling shares they owned. Customer agreements allow brokerage firms to rely on such representations.

But because the shares weren't actually in the client accounts, Goldman had to lend shares to its customers in order to complete the trades, regulators said. The result was a pattern of illegal trading ahead of stock offerings from March 2000 through May 2002 that went undetected -- but should have been investigated -- by the brokerage firm, the SEC and NYSE said.

"A broker must have a reasonable basis to believe its customers' representations that they own the securities they are selling," said David Nelson, the director of the SEC's office in Miami, in a statement.

"If, as in this case, there are significant trading disparities indicating that a customer may be lying to the broker, the broker must investigate the customer's trading and review its trading records to determine whether it can reasonably continue to rely on the customer's representations," Nelson said.

For the past two years, the SEC has been focusing on abusive short selling that violates a regulation intended to prevent abuses that can occur when companies conduct secondary or follow-on stock offerings. Mostly, those cases have been brought against hedge funds or individuals, who have been accused of using improper tactics to cover short sales with stock they had purchased through such additional offerings.

"This is the first case that we've brought against a broker," said Teresa Verges, assistant regional director at the SEC's Southeast regional office. She said Goldman was liable as a result of its role in executing the short sales.

The case grew out of an earlier action involving individual brokers. In 2003 brokers Ethan Weitz and Robert Altman agreed to pay more than $1 million to settle charges that they had engaged in short selling in advance of 15 stock sales. Securities rules prevent such trading on the theory that it can manipulate the prices that companies are able to generate through their stock sales.

Although the two weren't mentioned by name in the SEC's case against Goldman, they were two of the clients who traded through the firm's direct access system.

mikalMore 'road markers'#1533783/14/07; 18:19:39

Top investor sees U.S. property crash - 03/14/07 Wed - Snippit:
"MOSCOW (Reuters) - Commodities investment guru Jim Rogers stepped into the U.S. subprime fray on Wednesday, predicting a real estate crash that would trigger defaults and spread contagion to emerging markets.

"You can't believe how bad it's going to get before it gets any better," the prominent U.S. fund manager told Reuters by telephone from New York.

"It's going to be a disaster for many people who don't have a clue about what happens when a real estate bubble pops.

"It is going to be a huge mess," said Rogers, who has put his $15 million belle epoque mansion on Manhattan's Upper West Side on the market and is planning to move to Asia."

Sundeck** Commodities bulls, spooked cows, US recessions and global impacts.**#1533793/14/07; 18:28:51

Please be kind to little old me, oh great and wonderful server!!!

Smooch, smooch...

Sundeck tries again....


Part 1

With China's GDP growing at around 10% p.a. and robust growth also in India, Russia and Brazil, one wonders what affect a sharp economic downturn in the USA will have upon the global particular on the demand for and pricing of commodities...base metals, in particular.

Much is made of the notion of the USA being the "consumer of last resort". But how important is US consumption to commodity prices going forward? The US dollar may still be the "global currency", but its command is waning around the world. So too, I suspect, is the impact of the US economy and, more particularly, RECESSIONS in the US economy, on the world at large.

If a severe economic and financial crisis is brought on in the USA by, say, increasing sub-prime mortgage defaults, the effects might be expected to rattle upstream... manifesting in reduced demand for manufactured goods imported into the USA from countries like China.

But presumably, there would not be a complete disruption of China's exports of manufactures to the USA. Perhaps a 20-30% drop. It may be that growth in China's domestic consumption, coupled with increased exports to countries other than the USA, will be sufficient to ameliorate (after a few jitters) the economic impact within China of a marked recession in the USA. Furthermore, over and above its manufacturing and export industries, perhaps the major portion of China's imported commodities go into fixed infrastructure associated with China's burgeoning cities. In fact, a "recession" in Chinese terms may amount to a drop in GDP growth from 10% to, say, 6% for a couple of years!...even though certain parts of its manufacturing sector, say, may be hit quite hard. I suspect that demand for commodities from China will hold up and grow annually for many years, thereby sustaining prices, even in the face of a recession in the USA.

Therefore, "commodity-countries" like Australia and Canada, that supply raw materials (iron ore, copper, coal, etc) to China, may not be so greatly affected as once they may have been when the USA was truly the "engine of growth".

The coming US recession, whenever it occurs or how it is defined, is going to be "interesting" to observe in terms of its global extent and manifestation...



Part 2

In the longer term, somewhat similar development paths, but with their own array of problems and peculiarities, may occur in the other developing giants...India, Brazil and Russia. It will be interesting to compare "development" in India - the world's largest democracy and decentralised "free" economy - with development in China and its "command economy".

Russia is an interesting case. Growth in living standards across the population, leading to increased demand for middle-class consumables, is greatly dependent upon how well the redistribution of "energy wealth" occurs. The risk of energy wealth falling into the hands of a few oligarchs seems to have been averted, but at the expense of a free economy and the return to an inefficient pseudo-state-controlled hybrid. Putin and his successor (which include Putin himself) have a real juggling act to perform in Russia.

In the longer term (20-50 years) it looks like China is cultivating Africa as a destination for its products. Huge investments in selected countries within Africa should lead to improving "westernised" (with a Chinese hue) living standards over time; with the concomitant increase in demand for middle-class consumables...all coming from China.



Part 3

How imminent is an US recession? "Sub-prime" and other dubious house mortgages in the US constitute only about 20% of all outstanding mortgages. Of these, about 13% (and rising) are in trouble. This represents only a few percent of the overall mortgage market…on the face of it, not a terrifying shock to have to bear. Yet, it appears to have been sufficient to well-and-truly rattle the equity markets around the world.

Possibly just a herd rampage…

Look at the Shanghai fall in equities a week or two ago… About 80% of the Shanghai market capitalization (I understand) are moribund government owned stocks that contribute about 20% of China's GDP. The vibrant and profitable sectors of China's economy that contribute about 80% of GDP are not listed on the Shanghai bourse; yet the herd charged off to lower climes when the lead cow spooked…

Possibly the same is going on on Wall St. …but certainly things are tense around the traps, and spooked cows can do a lot of damage before they are calmed (or put down).

Just a few semi-connected thoughts...


TopazRandy#1533803/14/07; 18:29:03

You do just fine on the communication front mate. I'd hoped to provide a little light-hearted distraction is all.

BETTER than "just fine"

SundeckAh ha!#1533813/14/07; 18:31:00

I have found the secret...flatter the server!!

(Just teasn, big boy...let this one through too...please, there's a sweetie!)


USAGOLD Daily Market ReportPage Update!#1533823/14/07; 18:32:08">
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

March 14 (Reuters) -- Gold futures closed lower on Wednesday, pulled down on renewed selling in oil and U.S. equity markets as investors liquidated holdings in the precious metal to shore up riskier investments, traders said.

After the exchange floor closed, major equity indexes turned positive along with the price of oil. Gold's lows held in electronic trade, and eventually trimmed closing losses.

"We're following the equity market. It's simple as that. The three main factors affecting gold in the last few weeks have been the U.S. dollar, the oil price and the equity market," said Bernard Hunter, director of precious metals marketing at ScotiaMocatta in Toronto.

The COMEX April contract ended $6.90 lower at $642.50 after hitting an eight-day low at $637.70.

Hunter and others said fallout in the equity market from foreclosures in the subprime U.S. mortgage loan sector was impacting the gold market. "People are looking for liquidity or looking to pull profits or losses out of positions, and as a result, we (gold) really are tracking Dow stocks extremely closely," he said.

Some traders said they saw evidence of physical gold buyers poised beneath traded levels from about $635 and down.

Oil, which has also been following share prices, has added to gold's gyrations. Investors also regard oil as a commodity asset, but oil selling is more connected to the implications for the U.S. economic outlook with an equity market sell-off.

Mounting losses in U.S. subprime mortgage loans undermined financial stocks again on Wednesday, and spilled over to the gold market where some participants have been selling precious metal holdings to make margin accounts in the stock market.

ScotiaMocatta's Hunter called it 'the rainy day effect'.

"Because it is a stored value or a store for uncertainty, gold plays a bit of that rainy day investment role. You put aside your gold investment, because of your fears of a rainy day. When the day comes you liquidate your position," he said.

He added, however, that once the rainy day has passed and a more stable environment restored, investors will likely begin putting money away for a rainy day again.

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

flow5rates-of-change#1533833/14/07; 18:35:27

"Money alone sets all the world in motion" Publilius Syrus (c. 42 B.C.)

92.9 -0.16 -0.09 2007-02-01
95.5 0.03 -0.01 2007-03-01
95.5 0.07 0.04
95.5 0.17 0.00
95.5 0.08 0.00
95.5 0.25 0.03
97.4 0.38 0.00
96.5 0.08 0.03
97.0 -0.06 0.00
97.4 0.45 0.00
101.5 0.60 0.00

The Fed has no leeway. This worked on "Black Monday", during Paul Volcker's tenure, Nov. 2006, Y2K. It has always worked. Those ivy league celebrities are vacuous.
As Einstein said "imagination is more important than knowledge".

This is a new perimeter of knowledge.

GOLD FINGERSir MK#1533843/14/07; 18:45:53

REF:MK (3/14/07; 10:18:34MT - msg#: 153356)

Your Awesome!!

I loved what you wrote about gold. Perfect!!



TopazSundeck.#1533853/14/07; 19:23:08

The jumbled word test is a practised art as the more you do it the better you get at it.
Re: the (excellent) Tome...
...I think the depth of participation in the broader "domestic" RE market would have increased immensely over the years as Bank Tellers, Seamstresses, Boilermakers etc moved out of those industries (having either succumbed to technology of offshoring) into housing related activities. ref: mikals post below.
A monumental stack of cards built on the premise of rock solid RE ...and it can't help but get UGLY imo.

China, whilstever the Yuan maintains a limpitlike peg to the Dollar is effectively the World reserve currency by default and you'd have to think a lot of air that still persists in Buck today is due largely to the Peg.
Is it any wonder Paulson etal get cranky ...they're not able to dictate their own currency's value in trade.

You're dead right, we live in interesting times Sir.

MKMy experience, FWIW, has been#1533863/14/07; 19:30:57

that when you copy through photos, ads etc and try to carry that to the posting box, it nixes your post. Those sguiggleys are going to be killers until Randy gets us out of this venue, it seems.
MKOne more point. . .#1533873/14/07; 19:37:46

We are working on 1997 equipment due to the fact that I have been too stubborn to let us move into the new century until it was absolutely necessary. That equipment hangs by a thread, our esteemed behind the scenes techmaster tells me. And he's flat run out of paper clips and bubblegum. Well, almost anyway. As a result, our sitemaster has put in a string of 18 hour days that would make the middle linebacker for the Chicago Bears blanche. But we are close, the techies (including Randy) tell me. . . .

So on we go, my fellow goldmeisters. Post your best for we may not be here tomorrow.........................

Onward, my friends. Damn the torpedoes, full speed ahead!!

GOLD risky to ...EXTRACT??#1533883/14/07; 19:43:20

Now speaking of risk....

How about this?

"In Colombia, authorities reported Wednesday that nine geologists searching for gold were captured by the FARC. In addition, the army confirmed that four contractors hired by Colombian oil giant Ecopetrol were missing near Colombia's border with Venezuela."

This country has a very high kidnapping rate.....How many gold and other mineral hunters have been killed or kidnapped for this MOST VALUABLE STUFF??

It's my view with many of these mineral rich countries becoming more socialistic and closed to out-siders, gold and other resources will only become more valuable and more scarce.

Good way to drive the price UP!


Paper Avalanche@ MK#1533893/14/07; 20:17:42

Your post concerns me..

"So on we go, my fellow goldmeisters. Post your best for we may not be here tomorrow........................."

You say the word and I will cut a check to help fund any IT improvements necessary to keep the forum afloat if it should ever get to that point. I may not personally be able to contribute enough to buy a new server, but I am confident that there are enough noble gentlemen and gentle ladies at this forum (along with myself) who place an exceedingly high value on the service that you deliver with this web site and would find such an investment worth far more than however many FRN's it takes to keep things going.


Cometose'THE PIG"#1533903/14/07; 20:22:46

Lipstick and Mascara making her look so much better

Until the LUOOOW or whatever way you spell it

and the Music is begun.

THE HICKORY CHIPS .........aromatherapy to my nose ....


Keep the Olive Oil at the Ready

Don't want her to burn while she's ROASTING .......

I haven't seen anything so apparently ridiculous in recent memory as the action we are now witnessing

Cometosethe PIG#1533913/14/07; 20:26:24

Perhaps some Nitro GLYCERINE injection straight to the heart. .....

or Electric SHOCK THERAPY ....

or maybe just some HWORESQUE PERFUME..........A GALLON ought to DEW

melda laurePhew! #1533923/14/07; 21:05:55

Is it the luau, or the MBS CDO market burning?

Depending on the backing, the shakeout has removed many of the bit players. Now the giants may continue the subprime racket on more favorable terms perhaps...

... or not.

If it is not contained, it becomes a mexican standoff soon, or a "soldier's battle" if you prefer: wholesale butchery. If gold gets whacked here, we will be along later to "strip the dead". The vermin will be cast into the pit to be burned.

Goldiloxspring pattern#1533933/14/07; 21:07:11

@ Flow5,

I think your pattern is essentially within the bounds. My estimation has been that the retracement in the middle relates to a lot of shorts against rising options. The writers will expend a fair amount of capital to ensure that expiring options do so without value. While gold options and equity options expire on different days, it apprearts that there may be more money in the stock options, and more risk to cover.

SurvivorPosting Tip#1533943/14/07; 22:31:01

This should help with posting troublesome material: If the content is copied from another Web site or from a word processor on your computer, try pasting it into a text editor before posting here. In Windows the text editor is Notepad. (Does Mac have a text editor?) Look at it in the text editor. Delete anything that looks like Donald Duck swearing in the funny papers.

This should rid the text of any funny hidden characters that cause unexpected results when you post. It could apply to the 1997 gear and/or the new hardware. By the way, congratulations on the upgrade!

Wish I knew as about our economic topics!

- Survivor

ToolieMish Shedlock#1533953/14/07; 22:59:04

Mish is on Coast to Caoast AM tonight!

@Mikal: I was left with the same impression about the Fed comic book. A nice analogy to freegold! The "golden sunlight" produces the pretty colored flowers that everyone desires. – Arrgh...

melda laureSubprime, Gearing, CDS, Maxwell's daemon, Archimedes Lever#1533963/14/07; 23:14:52

There seems to be some misunderstanding in this whole subprime fiasco. The default rate on subprime mortgages is not at an extreme level yet.

Perhaps someone has a better understanding of how these contracts are "sausagized" into CDO's and how it is that a 1.5% minimum payment rate can be used to fund a 5-layer-tranche-cake of bonds with an 5% coupon? And perhaps there is something to be said on the availability of credit default insurance (or a sudden lack of counterparties).

This whole thing has the hallmarks of sand in the derivatives gearbox. Who threw the sand, and into what part of the gearbox? How (and whether or not) this bears upon paper gold is another intersting mystery- I doubt very much that the typical subprime defaultor is liquidating his hoard of soverigns or good delivery bars in a panic.

Mr Willie's screed only hints at the underlying iceberg rollover. Mr Schiff's article addresses the iceberg, but not it's dynamic tipping points. Recall that the commodities takedown has been blamed on GS "reformulated" index. While the subprime arena has always been fragile, it is possible that humpty dumpty was pushed.

TopazBond : Gold.#1533973/14/07; 23:53:04

Currently this eve Eastern management have deemed it appropriate that the Bond sell-off initiated in daytrade yesterday, is being continued on their watch.
PoG, is a direct beneficiary ...although not nearly enough to threaten the SM uptick.
It may even be a ploy to continually "shock" the SM's into a decline ...and systematically pick up the equities as they falter. a deep-pockets strategy if ever there was one.

Gold per-se will ONLY be deployed as a last resort on the eve of Systemic meltdown imo.

When OUR Masters devised the singular ..."WE" we-the-People ...we (the Corporation) ...I bet they didn't envisage being usurped by "others", time will tell how our masters sell us this new threat to their hegemony.

melda laureEye of newt, extract of volatility: one drop#1533983/15/07; 00:15:10

CDOs have become an important part of the mortgage market because they buy the riskier parts of MBS that others don't want. The higher-rated portions, or tranches, of MBS are sold to pension funds and insurers. But if the riskier tranches aren't sold too, the whole deal is off, Mason explained.

The so called "equity tranche" also known as "toxic waste" needs to find a home (hedgefund kamikrazy), or the whole alchemical deal cannot be executed.

melda lauremortally wounded but still dangerous.#1533993/15/07; 00:24:42

Rusty Bayonnet? Who makes this stuff up? I would dispute most of what Chris Laird has to say. But he does have a nice quote:

CIGA Rusty Bayonet is quoted to say regarding the last week of February,"I know for a fact that there was not a single buyer of subprime mortgages last week. I have a buddy who trades them and said he could not find a bidder down to 93... Essentially the subprime industry ceased to exist last week." This is the stuff of bank crises, from liquidity seizures, which to date have been minimized and fully denied. The next phase will center on negative amortization mortgages.

If in fact, the lack of derivativist volunteers ("patsies") is the primary cause, then all that is needed is for an of-shore-hedgefund-SpecialPurposeEntity-vortex-deus-ex-Machina-CreditFromTheVaccum-assymetrical-regauging-CentralBank-backstopped Fund to start selling credit insurance, and the crisis will pass... Heck that might only cost a measly giga-buck.

Like THAT will happen... but if it did, then Laird is premature.

melda laureThere can be only one... (just dont lose your head)#1534003/15/07; 00:36:54

Willie has a comment on the non-newtonian gold market action...

One highly significant topic barely touched upon is the shock wave to the credit spreads and the direct linkage to USTBonds. Long-term interest rates will be falling (NOT RISING) even though price inflation abounds.

So there is NO flight to quality but an unwiding of spread trades, and the commodities (and gold) will separate soon.

Since the year 2003, commodity & energy contracts (their stocks also) have been tightly yoked to the mainstream stock market, as in the S&P500 index. We are about to see that yoked effect be broken. We are about to see a reversion back to the traditional lack of correlation...

mikal@ChrisPowell#1534013/15/07; 00:41:50

Is this storm over or just supressed? - An unscientific sampling of letters finds both views closely held - Peter Brimelow, MarketWatch
Brimelow quotes Bill Murphy, Don Hays and Mark Hulbert on equities. Bill's comments on Wednesday's equities market(and gold and silver) are taken out of context as is becoming his norm.
While Brimelow just MAY be right that equities could lift off(IMO due to global hyperinflationary liquidity in the pipeline and the possibility of lower rates), he's taken a subjective and unfair "unscientific" approach- pairing off Hulbert's and Hays' equities-oriention against Bill's gold-letter. Brimelow seems less congenial towards gold and GATA in his last few missives but the man can't seem to shake his underlying passion for us can he?

TopazBond:Gold#1534023/15/07; 01:36:15

We've had a 4/32nds (red 08 to red 04) in the last hour or so ...will bear watching into the NY open as here lies the future imo.
Chart depicts the relationship that has developed between PaperGold:Bond - during off-delivery ...also (for those with eyes to see) the delivery month PaperGold:Buck - contra relationship.
No stress, no fuss, simply someone pulling or pushing these markets to the benefit of ??

TopazThe "this time it's different" crowd.#1534033/15/07; 02:11:41

Came out to play in Oz today.
Hot on the heels of a mediocre NY close, they took the (piddling) Bull by the horns and ran with it ...HARD!
You see, the Oz markets NEVER go down!
...and the reason??
As a Nation, through our compulsory Superannuation program (401K ish) every 8 weeks or so, the ENTIRE weekly wage bill of the country (equivalent) is committed to the markets ...and starts seeking out Yield.

The Lawmakers identified the folly of this arrangement some years ago and made it so subscribers could manage their own A/C's (with a few provisos) ...but most are content to sock it into their Union Fund etal and sit back on a retirement motza.
My wifes immediate superior was served up a shock on this latest pullback and has deferred retirement "for the time being".
This is truly a terrible way to approach the GOLDEN Years of life imo.

USAGOLD / Centennial Precious Metals, Inc.Become your own central banker. Own gold.#1534043/15/07; 06:33:15">central banks and gold reserves
flow5PPI#1534053/15/07; 06:56:00

Before seasonal adjustment, the Producer Price Index for Finished Goods increased 1.1 percent in February to 162.0 (1982 = 100). Ignore the seasonally mal-adjusted data.

2005-09-01 162.2
2005-10-01 166.2
2005-11-01 163.7
2005-12-01 163.0
2006-01-01 164.3
2006-02-01 161.8
2006-03-01 162.2
2006-04-01 164.3
2006-05-01 165.8
2006-06-01 166.1
2006-07-01 166.8
2006-08-01 167.9
2006-09-01 165.4
2006-10-01 162.0
2006-11-01 165.1
2006-12-01 166.0
2007-01-01 164.2
2007-02-01 162.0

TownCrierMarch Madness... and gold!#1534063/15/07; 08:30:15

Only about 90 minutes left on Jonathan's (shameless) Irish cheerleading special.

Will free silver Eagles be in anyone's future?


mikal(No Subject)#1534073/15/07; 08:49:56

Gold makes gains after surprise wholesale-level inflation surge - MarketWatch - Mar 15, 07
flow5EUR/USD#1534083/15/07; 10:47:24

The Euro is moving up in a straight line -- or c. 150 pips since 3/5.
mikal(No Subject)#1534093/15/07; 13:12:00

Dollar Loss Has No Precedent - Ann Berg - March 15, 2007
Good overview of dollar's history and impact.

Federal_ReservesHousing advocates warn of default ‘tsunami’#1534103/15/07; 15:02:56

WASHINGTON - A coalition of housing groups and advocates for the poor on Thursday warned of a growing "mortgage tsunami" affecting millions of Americans, particularly minorities, as fears rose that rising defaults could spill over into the broader economy........

> Each day the "fears" grow larger and the thunder clouds
> come closer. Like that woman in the movie COLD MOUNTAIN > soon everyone will shout "ITS RAINING"!

GOLD FINGERWHY? Sould he even care? What's the point? To protect HIS STASH??#1534123/15/07; 18:10:15

"The former Federal Reserve chairman told a meeting in Florida that the problems in the subprime home mortgage market are "not a small issue." If home prices go down, he expects problems to spill into other sectors. While Greenspan was careful to say he hasn't seen such spreading yet, he added, "I expect to."

"If we could wave a wand and prices go up 10%, the subprime mortgage problem would disappear," he said.

Maybe he should just take his millions and buy more gold and move to a sunny place with lots of _____and_____


Gary SevenIdle Musings on a March Madness evening#1534133/15/07; 19:28:43

Mostly I just wanted to see if my password still worked after all these years.

I bought "some" gold back in '00 and '01 when it was still cheap, thanks to the compelling arguments I read here at the table round. I have never been so grateful for good advice in all my life. For all the newbies and lurkers here, let me tell you that most of these guys know whereof they speak. I am not in that class, but I know class when I see (read) it. This forum is among the classiest in the web, as befits the subject matter. Whenever there are dramatic moves afoot in the world I always check into the USA Gold forum to get the straight poop. I never fail to get astute observations to clarify my thinking.

Have partaken of perhaps a few too many Negro Modelas this evening (thank you Black Blade), I feel overly qualified to comment on most any subject. I will try to resist the urge. However, I will say this: owning physical gold as a significant percentage of your new worth is THE best way to get a good night's sleep during these present and coming tumultuous times. I still keep track of daily market moves, but they don't affect me like they used to, because I know I have a solid (literally) store of wealth that I can rely on in even the worst case scenario. Okay, it won't help in case of a major life extinction event, but what will?

As someone used to say, "Gold - get you some."

slingshotTheir greasing up the presses#1534143/15/07; 19:32:25

Think they will bail out everyone?

I could use some cash.

slingshotFed Cuts Rates?#1534153/15/07; 19:49:22

I was Crazy when I said that, But I'm all right now!

USAGOLD Daily Market ReportPage Update!#1534163/15/07; 19:56:48">
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.

THRUSDAY Market Excerpts

Gold up as Producer Price Index soars

March 15 (DowJones) -- Stability in equities and crude oil, plus the ability to hold chart support, encouraged bargain hunting in gold and silver futures Thursday, traders and analysts said. April gold rose $4.60 to $647.10 on the Comex division of the New York Mercantile Exchange. The metals corrected back higher after slumping the prior day.

"The equity markets are a bit stronger, the U.S. dollar is a bit weaker and oil prices are bit stronger. All of those three factors came together and helped put a little bit of a floor under the gold price," said Bernard Hunter, director of precious metals at Scotia Mocatta.

"There is a bit of bargain hunting around."

Stock-index and crude oil futures were not up much as the metals pits closed, but at least avoided extending Wednesday's lows.

Another trader commented that some gold-market participants using pullbacks as buying opportunities were encouraged when Wednesday's slide stopped short of the lows from a little more than a week ago.

Still another trader noted that with equities and crude oil stabilizing, there was little impetus for traders to keep going short in the metals. Comex April gold's descent on Wednesday was halted at $637.60, above the March 6 low of $634.50.

The day's heavy slate of U.S. economic data did not appear to have a major impact on precious metals, although at least some support may have come from the strong Producer Price Index, said Bill O'Neill, one of the principals with LOGIC Advisors.

PPI soared 1.3% during February, with core PPI excluding food and energy up 0.4%. This was well above consensus forecasts for 0.6% and 0.2% rises, respectively.

"That was perhaps mildly supportive," said O'Neill. "But I don't think that is the focus. The market is focusing on physical demand, what the yen is doing and the Asian situation. So the PPI had a minimal influence.

"But if the CPI (Consumer Price Index) comes out hot tomorrow, I think it would have more impact."

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

slingshotGreenspan Speaketh#1534173/15/07; 19:59:09

Still in the picture.

TownCrierYou ought to click through to read the FULL article...#1534183/15/07; 21:41:44

A few enticing excerpts:

(All Things Considered) March 15, 2007 -- Almost 10 years ago, sociologist Sudhir Venkatesh was interviewing poor people in Chicago about unemployment when he noticed something: Many of them seemed to spend more money than they earned each month.

That's because they were doing odd jobs, working off the books.

He ended up writing a book out of his research called Off the Books: The Underground Economy of the Urban Poor.

Venkatesh says there's a huge amount of economic activity taking place in the inner city that isn't reflected in official government statistics about income and employment. He says this underground economy enables a lot of people survive -- but it also exacts a toll.

...A few years ago, Sudhir Venkatesh was talking to a vendor at a newspaper kiosk in Harlem. Venkatesh realized that he'd somehow torn the pants he was wearing.

"And the guy said, 'Well, why don't you go to my friend who's a tailor on 117th Street, and tell him that your cat keeps creeping up your leg.'

"And I said, 'Well, hi, Joe sent me and my cat keeps creeping up my leg.'

"And he said, 'Oh, OK,' and he takes me in the back where there's another whole store that's completely off the books. And I pay in cash, and I get treated fairly and it's completely off the books."

Venkatesh returned to the vendor and ask more questions.

"And he said, 'Well, do you need someone to clean your apartment? Do you need someone to fix your car? Do you need a Social Security card? Do you need a plane ticket to Haiti? What do you need?'"

Venkatesh tells the story to illustrate how big the underground economy is in neighborhoods like Harlem. Outsiders come into the inner city and see only unemployment and idleness, but many people are working off the books...

Venkatesh says there are countless people in the inner city, scraping by on odd jobs. They make and sell box lunches at construction sites, or fix cars in an alleyway. Venkatesh admires the entrepreneurial drive...

"These are flexible entrepreneurs who have enormous skills, and will go where the market takes them," he said.

But Venkatesh says there's also a big downside to the underground economy. Because this kind of work is unregulated, people can't go to the authorities for help when they need it. That means there's no one to resolve disputes.

"There's no government that's enforcing contracts, so you have to simultaneously solve the disputes you have, to simultaneously create the norms and expectations for what's fair and what's right," he said. "You may have to go out and punish people who don't pay you or don't deliver a good or service."

[...I had observed many seemingly minor disputes escalate into verbal and physical fights, and became extremely sensitive to the need to prevent miscommunication from spiraling out of control...]

In that kind of environment personal relationships matter, even more than in the mainstream economy....

...the book reveals a world most Americans know little about.

It's also a world where business owners cooperate with one another to a surprising degree. They lend one another money and workers, and swap information...

[A person] was given the chance to take a contract in another neighborhood -- one that would have brought in a lot more money. "But he won't do it because it's the ghetto that enables him to survive, and he feels that if he goes out to a neighborhood where he doesn't know anyone, he's ... not going to have friends who support him."

Venkatesh says that is one of the big downsides to the underground economy. People who work off the books for long periods can end up afraid to leave that world and isolated from the broader economy — which limits how much money they can make. He says that's an issue that society will have to address if it ever wants to bring real growth to the inner city.

The book just does an outstanding job of providing information on the way people have top make ends meet and how people survive," Wilson said. "And the importance of using different strategies."

^___(click URL to read the article's full, informative text)___^

Where many socio-economic-political commentators go awry is that they haven't attained for themselves a reasonable understanding of the these very real and informative facets of life at the grassroots level.

Interestingly, a wide-eyed trip back in history (to simpler (i.e., less structured) times) can also work wonders to provide this sort of insight.

So, if your exposure to "grassroots" (ghetto and Third world countries) is limited for any of a number of reasons, try putting your easy-chair to good use with a stack of well-chosen books of both contemporary and historical life.

Before you know it, you'll have enough deep perspective to recognize the shortcomings that dominate much of the superficial commentary being put forth by many of today's loudmouths and so-called experts on the ways and means of our political economy.

Cheers to you -- the power is in your hands.


Chris PowellChina says investment plans won't affect its dollar assets#1534193/15/07; 22:34:27

Maybe ... if owners of hard assets around the world are willing to trade them to China for China's U.S. government bonds and not liquidate the bonds and spend the cash on anything themselves. There's a sucker born every minute, but are there really THAT many suckers outside China?

* * *

By the Associated Press
via Yahoo News
Thursday, March 15, 2007

BEIJING -- China's creation of a company to invest a portion of its $1 trillion in foreign exchange reserves will have no impact on Beijing's holdings of U.S. dollar-denominated assets, Premier Wen Jiabao said Friday.

Wen made the comment at a news conference in response to a question about how the planned company would invest the reserves. Some economists have suggested that China's plans to diversify its investments could affect its substantial purchases of U.S. Treasuries, which helps to finance the U.S. government budget deficit.

China is believed to keep as much as 70 percent of its reserves in U.S. Treasuries and other dollar-denominated assets.

"It is true that in China's foreign exchange reserves, U.S. dollar-denominated assets account for a large proportion," Wen said. "I can assure you that instituting such a foreign exchange company will not have an impact on the U.S. dollar-denominated assets."

Wen gave no other details.

GoldiloxCentral Bank gold holdings fall to lowest since 1948, IMF says#1534203/15/07; 23:24:04


old holdings by central banks and other government organizations declined for the eighth straight year in 2006, to the lowest in almost 60 years, figures from the International Monetary Fund show.
Bullion holdings were 867.6 million ounces last year, down 1.2% from 2005, the Washington-based International Monetary Fund said on its Web site. That's the lowest since 1948, according to the World Gold Council. Gold climbed 23% last year as investors took up some of the supply through exchange-traded funds, or ETFs. „There is a lot of speculation some major central banks out of Asia or emerging countries will be increasing their gold position," said Markus Bachmann, manager of the $280 million Craton Capital Precious Metals Fund in Johannesburg. „What is far more important is the demand coming from the ETFs."

Of the top 15 government holders, Russia was the only bank to make purchases. Its total was 12.91 million ounces in December, up 3.8% from 12.44 million a year earlier, according to the IMF. Russia central bank spokesman Vladimir Lavrov in Moscow declined to comment. Sellers last year included France, Austria, Spain, the Netherlands, Portugal, Sweden, the Philippines, the Czech Republic, Serbia, Colombia, El Salvador and Mexico. The European Central Bank was also a seller, according to its Web site. China's holdings of 19.29 million ounces in December have stayed unchanged since 2001, when they were 16.1 million ounces, the IMF figures show.


I'll leave the "analysis" to someone better prepared than I.

Silver FoxTipping event.#1534213/15/07; 23:24:09

Respected forum readers.

My experience and many of you from previous posts the difficulty in getting respected (none-gold holding types with high IQs) peers to acknowledge coming fiscal problems of the US and the world. I can talk until I am blue in the face, and I might as well be speaking in Farsi. Happyeconomics news dominates news and their perceptions.

I believe most of us believe that the long-term fundamentals of fiat money will drive events resulting in a significant increase in the POG & POS. Try as it might, the US freight ship is taking on water, and the harder the government tries to pump it out, the more water is leaking in. Unfortunately, the rest of the world is in the same fiat money boat.

My question to you is what sort of event/s, (which should be anticipatable), will drive a change in their paradigms?

1- War with Iran and $250/barrel oil. (this event one will do it!)
2- But what other event/s????

I am sure we can put an interesting list together of landmines, i.e. derivatives, etc.

I think this would be a good list to KNOW… Don't you?

Thanks for any input or comments.


SundeckChina's reserves#1534223/15/07; 23:24:45

Well...if their investments are not going to effect their current US dollar-denominated assets, perhaps they are just going to capitalise their new investment company with future surpluses...which amounts to about $20B per month.

$20B per month should test the mettle of any goodly fund manager!!

That way: "instituting such a foreign exchange company will not have an impact on the [existing] U.S. dollar-denominated assets." and Wen's comment will be literally correct...


mikalChina passes landmark legislation#1534233/15/07; 23:31:26

China passes new law on property - BBC NEWS | World | Asia-Pacific | 03-16-07
Two bills pass by large majorities- one affecting personal property rights for the first time and the other ending "preferential tax treatment" for foreign companies

Goldilox"Slipping point"#1534243/16/07; 00:05:50

@ Silver Fox,

Tipping points? There are many, and I think Sinclair enumerates them well.

As I get caught up on things after a 4-day conference on "Data Protection, Encryption, and Security", I notice the old Sawbuck is a full point beneath its 50 day MA.

The "Titanic" is developing some leaks!

GoldiloxGasoline "temperature map"#1534253/16/07; 00:15:55

Zoom in to see the average gasoline pump prices in your locale.
TopazCB Gold holdings.#1534263/16/07; 03:18:53

The IMF by their own admission have encouraged double dip accounting standards these last several years when it comes to CB Gold.
I'd be loath to take ANY "official" estimate on Gold holdings seriously, particularly from them ...they're likely to be WaY off IMHO.

Now for Silver: Speaking of ways, if the thing can find a way to best $13 I'd reckon it wouldn't stop 'till ...$18ish.
Find a way Girlie! You know you want to.

Bond showing 1/32 green ..should stop Gold in the NY open.

Let's watch!

TopazManagement meeting 3am.#1534273/16/07; 03:45:48

A wave of green just swept across Europe ...E-Bonds went Red, Dow futures rose 15 to be -13 ...The World lurches and limps hopefully onward and upward! 'till one day doesn't!
GoldiloxDollar Blues#1534283/16/07; 03:54:33

Uncle Sam's Sawbuck is still in the woodshed in Europe, with the Oz $, Swissy, and Yen as the major beneficiaries by percentage.

Supporting Sinclair's hypothesis, gold seems to be tracking the Yen's motion, at least short-term.

Sierra MadreDollar falls is up...#1534293/16/07; 05:52:15

Early check-in on the situation....

Over at INO, the dollar five-day chart shows a series of cascades, and this morning we have another cascade...the dollar index now at 82.73...

Gold is perky in London this morning, now at $650 or so.

Well, I guess gold will get its hair done later today in NY - can't have the market close on a high note for a weekend.

Enjoy the Human Comedy!


GoldiloxSomber Sawbuck#1534303/16/07; 06:09:37

@ Sierra Madre,

The daily DX low that I've seen is 83.03, not yet below 83. Perhaps you were looking at the YTY chart, with an 82.70 ish low in December?

In case no one's watching the Sawbuck "haircut" has been 2.5% in the last month, almost 5% since Oct, and 9% YTY.

Gotta love those "interest bearing" accounts. Seen any 11 percenters lately, that barely cover the currency loss and cap "gains" tax for a break-even?

Sierra MadreDollar in 82's...#1534313/16/07; 07:17:10

Well, I might be mistaken...but I tot I taw it.

In any case, looks like we'll see it before long.


LebiequeGold dips and subprime real eatate becomes more valuable?#1534323/16/07; 07:26:49

...Greenspan said, and I quote Skoloff: "that if home prices would go up 10 percent, the subprime mortgage problem would

Wanton mischief or plain vanilla stupidity? If, once the new "greenspan 10% housing increase" has been reached once
again, then all problems should miraculously have cease to exist, according to him. Why then did this not happen during the
numerous previous 10% increases, perhaps because this brainwave did not come from him at the time? My guess is, he's
been listening to his "hearing committee" for too long and thinks the whole world is as shamelessly accommodating.

USAGOLD / Centennial Precious Metals, Inc.Today's CPI data shows prices up another 0.4% in February. Meanwhile, this chart shows gold has familiar headroom to climb.#1534333/16/07; 08:47:18">gold price potential
Black BladeTop investor sees U.S. property crash#1534343/16/07; 09:05:22

Black Blade: Check this link out! Jimmy Rogers is moving out of the United States. He's selling out everything and going to live in Asia. Doesn't expect the global economy to survive intact.

He has had a good record so.... If anything its best to be prepared come what may. As always, get outta debt and stay outta 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"

mikal@BlackBlade#1534353/16/07; 09:07:38

Good advice. That's the 3rd rerun of that link here though.
mikalInflation spiral outmaneuvers media histrionics#1534363/16/07; 09:12:35

The Return of Inflation Ex-Inflation | The Big Picture Blog
by Barry Ritholz w/feedback comments

Black BladeMikal#1534373/16/07; 09:19:27

Thought it worth mentioning as it was being pounded by Bob Pisani again on CNBC this morning and the recent Subslime mortgage debacle is the hot topic in the financial media. Of course cold hard cash (Gold and Silver) are doing fairly well today.

- Black Blade

Black Blade(No Subject)#1534383/16/07; 09:23:45

NEW YORK (Reuters) - Canada's Barrick Gold Corp. <ABX.TO>, the world's biggest gold miner, may bid for No. 2 Newmont Mining Corp. <NEM.N>, BusinessWeek reported in its March 26 edition.

Citing "some pros," the magazine said Barrick would go after Newmont for its proven and probable reserves of about 95 million ounces of gold.

A deal would likely value Newmont in the "mid 50s," BusinessWeek said, citing pros.

Black Blade: Something is wrong with this picture. Megahedger Barrick going after unhedged Newmont? Sounds like an admission by Barrick that the Randall Oliphant era was a big mistake and they are desperate to get more Gold to cover the under water hedgebook. I know people at Newmont and I am sure that they are not impressed.

TopazAg Fox.#1534393/16/07; 09:27:10

It's late Friday eve (axually early Sat morn) here and I've just enough fire in the belly to tackle your challenge posed yesterday.
Assuming the "Silver" is an indication of vintage as well as disposition, we "older types" lean a lot more to caution/prudence than do our less-lived brothers. I can recall (as no doubt you can) my Father alerting me to many and varied perils that, as a youngster of 30odd I cared not to acknowledge ...never, I might add, to my peril (lucky I guess).
So we stumble on until we reach an age where self-preservation is uppermost in our thoughts ...and then it seems, we embrace the basics of it all.
Our, or MY fondest hope is that I pass away some time in the next 15-20 odd years and am able to bequeath a sizeable Au/Ag stash to my kin hoping it's value then reflects it's value NOW a bit for good measure ...;-)

What might constitute a tipping point?

Probably the most insidious (of many) negative aspect of a Democratic System is the pandering to minority groups to the detrement of the majority.
The masses tolerate a HUGE amount of "crap" ...then one day, as if by magic, they do a Newsfront and simply "don't take it any more".
If I had time and inclination I'd list a few items/examples where "the People" have been shafted by the Few ...but somehow I think you get my drift.

Another aspect of the devolution is our newfound Fiat regime which exaserbates the above to no end.
Without proper weights and measures, society degenerates into a dog-eat-dog mentality where morals, ethics etc simply become passe.

So, on one hand we have Revolution to look forward to ...and on the other, a knock down, drag out chaos.

Hmmm, I hope I'm not around to see it.

GoldiloxBequeathing wealth#1534403/16/07; 09:43:14

@ Topaz,

One thing about "bequeathing" wealth. You don't have to stick around and watch your decendents squander something they didn't sweat to earn!

My parents will pass away with the books "squared", and I will hopefully do the same. The greatest trans-generational gifts? Undying love and support, and the ability to take responsibility for ones' own decisions.

otish mountainBlake Blade re: Barrick#1534413/16/07; 09:51:02

Good to see your posts, I have a suspicion that Barrick will resume to their old tricks once they get more ounces in the ground. With their failing to obtain Nova it was just a matter of a short time before this latest attempt.Remember who is on their directors board.
geUS posts 1st investment income deficit#1534423/16/07; 11:02:46

mikalHeadline heydays#1534433/16/07; 12:32:30

Dollar falls to three-month euro low - CBS Marketwatch (03/16/2007 9:49 AM)
Oil Rises Because of Robust U.S. Fuel Demand, Falling Supplies - Bloomberg (03/16/2007 9:51 AM)
U.S. Consumer Prices Rise 0.4% in February on Fuel - Bloomberg (03/16/2007 7:53 AM)
Greenspan warns subprime woes could spread - Reuters (03/15/2007 1:21 PM)
Subprime Mortgage Woes Are Likely to Spread - WSJ ($) (03/16/2007 5:02 AM)
U.S. Michigan Consumer Sentiment Index Fell in March - Bloomberg (03/16/2007 9:50 AM)
As Costs Climb In Food Chain, Consumers Pay - WSJ ($) (03/16/2007 5:11 AM)
Subprime Defaults to Soar, Lenders to Fail, Hedge Funds Say - Bloomberg (03/15/2007 4:21 PM)
Private equity tightens grip in debt markets - FT ($) (03/15/2007 9:30 PM)
Subprime spiral poses biggest investor risk: Lehman - Reuters (03/16/2007 5:20 AM)
Risky Business Still Attracts Eager Lenders - NYT$ (03/16/2007 5:21 AM)
US mortgage woes could be tip of iceberg: economists - AFP (03/16/2007 5:27 AM)
Fed Is No Savior - (03/16/2007 8:07 AM)
Home prices can fall beyond your fears - CNN/Money (03/16/2007 8:18 AM)
Warning on hedge funds' conflict of interest - FT (03/15/2007 12:17 PM)
California home sales fall to 10-year low for February - San Diego UT 03/16/2007
G.M. Says It Has Found Serious Flaws in Accounting - NY Times (03/16/2007 5:23 AM)
China's Growth Is Unstable, Unsustainable, Premier Wen Says - Bloomberg (03/16/2007 5:11 AM)
Airbus workers stage Europe-wide strikes - Houston Chronicle (03/16/2007 8:04 AM)
Adam Smith's hidden hand is vanishing - FT (03/15/2007 12:17 PM)
From Subprime To The Ridiculous - Forbes (03/16/2007 5:25 AM)
Moody's, Stupid or Greedy, Flip-Flops on Banks - Bloomberg (03/16/2007 5:31 AM)

Sierra MadreBarrick to buy Newmont?#1534443/16/07; 12:39:12

Does not sound good to me, at all.

Barrick has acted for all the world as if it was a GOLD-MINING ARM of the Fed. Am I right?

Now, it wants to gobble up Newmont, No. 2. So, a bigger ARM OF THE FED to supply the DEEP STORAGE GOLD will be operative, going forward.

Sounds very much like the Fed et al. are carrying out a kind of NATIONALIZATION OF THE GOLD-MINING INDUSTRY. They have the dollars necessary to do it, no doubt. They do not care if it is a money-making operation, also. The stockholders can take a hike, so can the stock price.

What is important, is CONTROL OF THE SOURCE OF GOLD, so that it can be fed into the system, along with paper gold, and thus keep the price of gold down, and the dollar up.

"The Dollar Up" - the only important consideration. Otherwise, game over.

Just my take on Barrick-Newmont. I am not a stockholder in any listed mining company.


ge@ Sierra Madre - an optimist's view on Barrick-Newmont#1534453/16/07; 14:25:44

The nationalization of gold mining industry may perhaps be a good omen for the gold price. It is possible that FED is trying to build gold reserves for the post-crash era where trade balances between major powers are settled in physical gold. If true, this would indicate that physical gold supply for the retail investors would be squeezed - driving the price up. Secondly, US interests would initially require a high gold price to settle the trade balances with the outer world - the manipulators would manipulate in our favor. Hope springs eternal! May be my optimism is misplaced. I don't know.
mikalWhere there's a will there's a way#1534463/16/07; 14:33:43

A Lender Who Will
-- Posted Friday, 16 March 2007 by Adrian Ash
16 March 2007 | Excerpt:

"Creative new subprime loans – 'piggyback', 'interest-only', and 'no-doc' loans, among others – accounted for 47% of total loans issued last year," reported the Wall Street Journal recently.
"At the start of the decade, they were less than 2% of total mortgage loans."
But that's the nature of innovation. It either accelerates...or grinds to a halt. Scream if you wanna go faster!
"As long as lenders made loans available on virtually non-existent terms," writes Paul McCulley, managing director at Pimco, "the price didn't really matter all that much to borrowers. The availability of credit trumped the price of credit. Such is always the case in manias."
Hence the Fed's failure to touch the US credit bubble with its 17 hikes in interest rates. For as long as credit remained innovative, the inflationary trend would stay on track.
And now?
"The ongoing meltdown in the subprime mortgage market," says McCulley, will "unambiguously render any given stance of Fed policy more restrictive...Just as mortgage demand seemed inelastic to rising short rates when availability was riding relaxed terms, so too will demand seem inelastic to falling short rates when availability faces the headwind of restrictive terms."
In short, the Fed couldn't stop lenders from lending simply by raising its rates. Nor could the Bank of England, ECB or anyone else.
The Bank of England began raising its rates at the end of 2003. So did the Australian and New Zealand central banks, too. The US Fed started to hike Dollar rates in 2004, and a year later, the European Central Bank tagged along too.
Japan and Switzerland finally began hiking rates – albeit from near-zero – in 2006. But the effect on world money supply has been negligible up until now. Indeed, the "reflation" unleashed by record-low interest rates starting in 2003 just couldn't be tamed, not by a few measly basis points at least.
A quarter-point here and a quarter-point there was nothing against the forces of financial innovation.
Seventeen hikes in US rates? So what! US broad money, according to John Williams at, is growing by 11% annually. Eurozone money supply has been growing at 9.8% year on year. Britain's enjoying a 14% year-on-year bubble in money, even though short Sterling rates have risen by one half.
The global money supply has come to have little to do with interest rates, or so it would seem. Some three-quarters of all liquidity comes in the form of derivatives and securitized debt, as the analysts at Independent Strategy have observed. And if raising rates did nothing to slow it, the bubble in money might just start to deflate even if short-term rates now get clipped back towards zero.
The top of the credit cycle may be in – not because real Dollar rates have finally turned positive (which they haven't, by the way...), but because the lenders themselves are shuffling back from the edge.
Leave the market-leader's position to somebody else. The innovative step in finance today is to retrench...ask for secure credit ratings...demand proof of income...switch from digital and paper promises to hard, physical assets.
Once everyone's crept back to tight lending standards and a hatred of credit, the time will have come to step forwards again – and clean up in finance by lending on easy terms yet again.
But that time's not now. The retrenchment has only begun. Be brave – and step back."

GoldiloxLatvia struggles with currency weakness#1534473/16/07; 14:54:16


Lat's movement has implications for emerging market currencies

Last Update: 2:04 PM ET Mar 16, 2007

NEW YORK (MarketWatch) -- A year ago, a sell-off in the currency of Iceland, a North Atlantic island nation with a population of less than half a million, triggered a meltdown in emerging markets across the globe. There are growing signs that Latvia may be the next Iceland.

Speculation has been rising that the Baltic republic may soon have to devalue its currency, the lat, which is getting closer and closer to the low end of its narrow fluctuation band. The Bank of Latvia only allows the lat to trade in a 1% range against the euro.

In fact, the Latvian central bank confirmed that it has intervened in the market in the past two days by selling euros to support the local currency, according to Lars Christensen, senior analyst at Denmark's Danske Bank. The lat breached the lower limit of the trading band on Friday.

Latvia's domestic situation increasingly resembles that of Iceland last year - it has an overheated economy fueled by credit growth, soaring inflation and a huge current account deficit.

In fact, the country's current account deficit, at 22% of gross domestic product, and inflation rate, running at 6.6%, were the highest in the European Union in 2006, according to Fitch Ratings.
"It's not often that you see this sort of headline, but Latvia could be the one to watch if the recent weakness in emerging market currencies is to gather speed," said Steve Barrow, chief currency strategist at Bear Stearns.

Scary numbers

The Latvian government is trying to restore confidence in the lat by playing down the devaluation risk. But global risk aversion, which is on the rise following the sell-off in the equity markets of the past several weeks, will keep the pressure on the lat and with it, on the riskier, and more volatile emerging market currencies.

With such a narrow trading band for the lat, and with some "scary" looking economic numbers, "it seems almost inevitable that something has to give," Barrow said.

The ripple effect from a sharp slide in the lat could be significant. It was the sudden depreciation of the Thai currency, the baht, which triggered the Asian financial crisis in the late 1990s. And there was a similar domino effect from a sell-off in Iceland's krona last year.

Emerging-market currencies fell sharply between February and June 2006 after an unexpected downgrade of Iceland's outlook by Fitch. Fears of a global liquidity crunch forced investors to bail out of riskier investments.
The Latvian economy by any measure is quite small, said Danske Bank's Christensen.

Still, "the Latvian story is extremely interesting in the sense that [it] should be a reminder to people about other countries with similar problems," he said.
The current account deficit and debt liabilities make Latvia vulnerable to an increase in risk aversion because of its dependence on external financing.
Earlier this month, Fitch warned that the country looked most vulnerable to an "abrupt adjustment in capital and financial flows and slowdown in economic growth."


Canary in a "bugger-thy-neighbor's currency" coal mine?

GoldiloxGold -- a victim of its own success#1534483/16/07; 15:01:31


Traditionally, the precious metal has been seen as a way to hedge against losses in times of financial crisis and economic or political uncertainty -- and there's certainly been a great deal of that in the global markets recently.
'Gold has moved from being a beneficiary of a stock market sell-off -- to a victim.'
— Kevin Kerr, Global Resources Trader
But "the gold market has thus far been frustratingly unable to summon its historical safe-haven attributes," said Jon Nadler, an analyst at Kitco Bullion Dealers.
"When you have bullion moving in tandem with equities, you have to scratch your head," he said. And "the last thing the traditional buyers want from gold is for it not to perform when the going gets tough in paper assets."
The various means by which gold is acquired and sold has expanded -- and that diversity has been both a friend and enemy, feeding a very volatile trading environment.
Gold has "evolved so much that now investors are faced with numerous choices on how to own the precious metal," said Kevin Kerr, editor of Global Resources Trader, a newsletter of MarketWatch, the publisher of this report.

"Gone are the days of merely futures and bullion. Today, investors have a wide variety of exchange-traded funds, hedge funds, mining shares and a myriad of futures and options contracts all over the globe," he said.
At the same time, "what's happened is that gold has moved from being a beneficiary of a stock market sell-off -- to a victim," he said.
Subject of success

So you might say gold's a victim of its own success.

"The apparent quest for liquidity among global investors has made gold a victim to its own recent success," Nadler said. "A preference for cash is evidently excluding the ultimate form of cash that gold is normally thought to be."

Still, Amaury Conti, an equity trader at San Antonio, Texas-based Austin, Calvert & Flavin Inc., doesn't believe the view of gold has really changed. It's the way to trade it that's different.


Interesting view on how the growth of ETFs and other paper-gold may be masking ITs traditional "safe-haven" status. Victim of its own success, or victim of derivatization, the financial WMDs?

flow5CPI#1534493/16/07; 15:19:25

The non-seasonally adjusted CPI is up 6.1% yoy.
flow5CPI - correction#1534503/16/07; 15:32:18

6.1% was from Feb 2005 to Feb 2007.
Paper AvalancheCatch the latest fad in home finance.....#1534513/16/07; 15:37:30

Deed in lieu of foreclosure.

Heard that this is becoming epidemic in the Detroit area.

Gold does not have such encumberances. Get you some.


Paper AvalancheA recent story on DILOF#1534523/16/07; 15:41:40


As the number of homeowners in financial distress soars, Gorney said banks are increasingly willing to consider alternatives that may be cheaper and faster than foreclosure.

Some troubled homeowners are turning over deeds in exchange for banks ripping up mortgages, a practice called "deed in lieu" of foreclosure. It damages credit ratings, but not as severely as a foreclosure would.

Even with those tools available, Gorney rejects nearly half of the applications she receives from homeowners looking for a way to avoid foreclosure because there is simply nothing she can do to help them.

end snip

TopazGold:Silver.#1534533/16/07; 15:56:33$gold:$silver&p=D&b=5&g=0&id=0

Staring at this Chart muttering "wher'd I go wrong" isn't gonna fix it!
The thing (Ag) looked so promising coming into the Feb/Mar roll-over, started downward and then...pop-up,, like as if it was a stock or something.
I'm gonna bite my tongue for Another week then "lookout" ...abuse will be forthcoming!
You HAVE BEEN warned, Beeotch!

TopazPA.#1534543/16/07; 16:14:55

The trend here is "at all costs" don't give 'em their Deeds ...Even if they pay down their mortgages, the Banks etal will argue black and blue before releasing the Deeds.
I put this down to the fact that these Mortgages have been bundled and on-sold as investment "packages". It becomes a headache big time, if the need to extract individual "deeds" becomes pervasive.

Another point, don't give any bouquets to those blood-sucking paracites ostensibly "helping" those in need. Like the vermin before them, they do it for the bucks PA, not out of any grand sense of lending a helping hand.

Just my HO tho.

Sierra Madrege - your view may well be correct!#1534553/16/07; 16:28:34

Yes, the thought also crossed my mind, that this move to join Barrick and Newmont might have the purpose of preparing for a critical need for gold, in the post-crash environment.

SO FAR, we have not been given the slightest hint that that may be on the minds of the Masters of the Universe. But then, if they were thinking of this development, they wouldn't be casting any hints at all, or the show is OVER.

I think there cannot be an orderly reform of the International Monetary System. If any group of countries expressed the need to call a conference for that purpose, gold would immediately go through the roof! Because anyone with any sense knows that "reform=gold".

So, we'll just stagger into a reform after a crushing crisis.

Have a good weekend, everyone!


USAGOLD Daily Market ReportPage Update!#1534563/16/07; 19:21:01">
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.

FRIDAY Market Excerpts

March 16 (MarketWatch) -- Gold futures climbed Friday to close at their highest level in more than a week, boosted by a weaker U.S. dollar and uncertainty surrounding the outlook of the U.S. economy. Gold's benchmark contract finished $1.90 above the week-ago closing level.

"With stable equity markets, gold is able to concentrate on the declining dollar spurred by inflationary data," said Peter Spina, a chief investment strategist at

And "despite a truckload of new gold bears and many gold bulls openly licking their wounds, gold has once again shown its internal strength by consolidating its overbought condition and now resuming its climb to $700+," said Peter Grandich, editor of the Grandich Letter.

Gold for April delivery rose $6.80 to close at $653.90 on the New York Mercantile Exchange. It climbed as high as $656.50 earlier, a level not seen since last Friday, though it hasn't closed at a level this high since March 8.

"Gold finds itself once again pushing the $655-$660 resistance," said Spina. "A break above should bring in additional momentum and extend its rally." But "with the subprime debacle resonating in the background, the threat of another market sell-off does remain a concern for the metals, which have become vulnerable on such strong selling pressures -- a rush for liquidity," he said.

For now, "stable equity markets do allow gold to return its focus on the fundamentals and we see this today with the U.S. dollar back testing important technical support levels," he said.

The dollar fell sharply Friday, strengthening demand for gold. Consumer prices increased 0.4% in February, a little higher than expected, led by higher prices for food, energy, shelter and tobacco, the Labor Department reported earlier Friday.

"The terminally ill U.S. dollar and the mounting economic and political woes in the U.S. are only added reasons to expect $700 faster than most could imagine," said Grandich.

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

mikal@Goldilox#1534573/16/07; 23:24:46

Re: Latvia - Good find. I agree, may be a kind of sleeper. Hear that PTB? Or is there enough market noise to wake the dead?
No matter. Everything's under control...
for @ least as long as I can control myself.
And Goldilocks says it's just right. You can't be related, I'm sure ;)
This week copper was up over 8% and nickel over 12%. OPEC also refused to increase output(ref link).
News reports Friday say all OPEC's cuts, recently agreed upon, have still to affect the markets. These include new enforcements curbing overproduction! The Nigerian mercenaries may volunteer to back that up.
Someone had a link to a rickshaw builder. There'll be more rickshaws around. Now there's a fine walk of life, provided the Chinese don't take it all TOO seriously and think we're a colony ;)
Gubbermint regulators and taxmen(city, state, Fed) may walk all over you for licenses, fees etc., but the rest is a walk in the park, or at least around the block if you're lucky!

Base metals power ahead led by nickel and copper | Chris Flood | | MARKETS | Commodities | Mar 17, 07 02:00
Those naughty miners! Make that EVIL TARRISTS! It's a conspiracy wth those oilmen, er I mean Ayrabs, (never mind they're a minority of the oil producers) to inflate our prices and destroy our great nation, what's left of it that is. We're going to have to do something about this. Get Dick on the line! I want all available state troopers to secure them dadblamed mines for our company, er I mean our people! Before the commies do it.

USAGOLD / Centennial Precious Metals, Inc.Finding peace of mind amid market volatility#1534583/17/07; 06:24:29">gold and volatility
slingshotI can't do it.#1534593/17/07; 08:03:31

Good read.

ToolieRe: I can't do it#1534603/17/07; 09:09:39

Why are dollar deposits safe in a FDIC insured bank? Because they can (and will) make them in unlimited amounts.
mikalDIY- Do it yourself#1534613/17/07; 11:40:25,1759,2104989,00.asp?kc=EWRSS03119TX1K0000594,1759,2104989,00.asp?kc=EWRSS03119TX1K0000594 Study: Businesses Unprepared for Aging Workforce / EWEEK / Mar 16, 07
TopazAg on the LaunchPad?#1534623/17/07; 14:59:33

Well, we've taken a peek at +13 ...It'd be a brave soul that would declare the $13 level done and dusted but ...if we can stick to the good, honest rate of ascent as described by Silver these last couple of days ...should be a goer into the 13.20's then ...Oh lordy ..a week of bliss riding the Silver freight train ee-haaaa! Sub 30:1 Ratio here we come!
geIran to Sell Oil in euros and other currencies - March 17, 2007#1534633/17/07; 15:57:28

Here we go again
CometoseCOT#1534643/17/07; 18:06:29

FOr the Week the Commercials in

Silver were net long 5000 contracts

the Commercials in Copper were net short 120 contracts

and the Commercials in Gold were net long

5600 contracts......

SundeckParallels with the 1970s are striking#1534653/18/07; 04:52:13

...according to this commentary... I suspect they are not far off the mark...


slingshotI Know Nothing.#1534663/18/07; 07:49:36

Includes 67 page report on money lending.

I am getting the impression as I read most of the editorials/articles on this mortage moster, that a escape goat is being sought.

slingshotHousing bubble#1534673/18/07; 08:06:15

The article is great and a sizable commentary afterwards.

I know these articles have no mention of gold but I am trying to put into prespective where the rush to Quality/Wealth will begin. They have thrown caution to the wind. When they realise what they have done, it maybe too late to recover.

slingshotMetals diverge from stocks#1534683/18/07; 08:26:51

The start of things to come?

USAGOLD / Centennial Precious Metals, Inc.Become your own central banker.#1534693/18/07; 08:29:36">central banks and gold reserves
slingshotStocks Retreat#1534703/18/07; 08:48:40

Another concern.

slingshotBloomberg link#1534713/18/07; 08:54:49

That is the link but don't come up
Article at Bloomberg site.

slingshotPrecious Points#1534723/18/07; 09:36:38

Love the Graphs.

slingshotStock Market /Next Recession#1534733/18/07; 09:49:51

"Bank Regulators have just been loosed from their cages."

Just had to laugh at that statement. GO GET'EM BOYS! Yeah, that's the ticket.

slingshotRoofing#1534743/18/07; 09:55:18

Going to help my neighbor put a new roof on his home.
Working second shift ;0) Be back later.

Gandalf the WhiteTEST #1534753/18/07; 11:40:02

-- <;-)
Cometosedollar , media hacks and obscure writer prognosticators #1534763/18/07; 13:25:17


the majestic SWAN DIVER

Toolie~~~ It's like living in the future ~~~#1534773/18/07; 13:27:10

From Motor City to ‘mater city.

This article is along the same lines as Townie's underground economy article of a few days ago. Can bartering for arrowheads be far behind?

Snip: Detroit, experts say, has quietly become the nation's mecca for urban farming.
"What's going on is quite a phenomenon," said Kami Pothukuchi, a Wayne State University professor specializing in urban planning and food systems. "You have a community that needs access to fresh food, and you have open land. The two are coming together."
The downturn in Michigan's job market -- the city of Detroit has an unemployment rate of about 15 percent -- means people are looking to eat affordably and to generate income, he said.
Detroit provides a perfect setting for urban gardening. (end snip)

The truth told, you'd be better off with an arrowhead, it doesn't lose value in your pocket.

CometoseTHE MUSIC#1534783/18/07; 13:27:27

ROCK AND ROLL WILL NEVER DIE ............Neil Young

Gold will never cease being a hedge against willful acts of bankers and politicians nor against their sins of ommission.

Cometoseretrospective on the Yen Carry trade#1534793/18/07; 13:32:17

Looks like Yen Carry was all set up originally as


Knowing that this was necessarily going to end ........

it is being replaced by HELICOPTER BEN'S PROP eller

mikalComplimentary thrusts#1534803/18/07; 13:49:16

A recent news article by AFP on the subprime mortgage market left out specific connections with the larger mortgage and default swaps etc. markets, but
narrowed in on the case for and against further subprime fallout, happily snuggled within the establishment media
nest with the other warm and irresistably fuzzies.
But the following snip ending the article pointedly predicts the dual irony of the struggle for precedence in public polls and profits that the latest housing "twist" or stage or cycle turn if you will, opens to both predatory and conscientious initiatives.
Politics and profits make strange bedfellows, more so when the governing system is ostensibly a free market one.
So if overegulation follows fast on the heels of underegulation, who will be the wiser if drastic measures(quick injections of grease)bring quick results to certain "sqeaking wheels", the 'loudest' or the most connected? Few politicians will care until the new econo-financial imbalances and social dislocations are felt 3, 5 or more years hence. We will conveniently withold mention of psycho-ethical costs and other such 'hypothetical' indulgences.
But this overegulation irony is merely the compliment to the dual thrusts terminating markets' status quo.

The other force of the vortex is in
the snippet below on the ORIGINAL mismanagement and the "market discipline" to follow.
So, corporate-undermined "regulation" and government-enabled "predatory lenders" will result in "market discipline" and targeted, ill-advised, compromised, politically correct "legislation".
"Democratic Senator Christopher Dodd (news, bio, voting record), a 2008 presidential contender, attacked "PREDATORY LENDERS and REGULATORY failures" that he said are costing rising numbers of Americans their homes, and promised to look at new legislation.

The MBA's Duncan, however, rejected changes to the law.

He said "market discipline in this industry is swift, can be severe, and is more effective at changing lending practices than any potential changes in regulation."

mikalTypo#1534813/18/07; 13:59:40

Fuzzied, NOT "fuzzies".
GoldiloxThieves drag gold from museum#1534823/18/07; 18:19:47


TOKYO: A group of three masked men dragged a hefty block of gold bullion weighing about 100 kilograms from a museum in central Japan, police said on Sunday. The block of gold worth about 200 million yen ($1.7 million) was placed in a safe and exhibited with the safes door open so that visitors to the museum could touch it, owner of the gold, Hisao Nakahagi, told AFP. The gold was exhibited on the second floor, which was monitored by a security camera from the first floor, said Nakahagi, 59. An employee on the first floor heard a noise from upstairs and rushed up there, he said. Three masked men were trying to move the gold bullion. The men pushed the employee aside, dragged the gold in a bag downstairs, and drove away with a fourth accomplice, he said.


Nice security! One museum employee on another floor to watch a 220 lb. block of gold?

GoldiloxGREENSPAN SIGNATURE#1534833/18/07; 18:26:39



The current mess of mortgage defaults and foreclosures testifies to the venerable and highly acclaimed serial bubble inflation engineer Greenspan's leadership and counsel as destructive in high order. Alan must be shuddering and cringing at the extreme damage to banking balance sheets, the spate of lending institution collapses, and the contagion within banks. He urged millions of US homeowners to rush into adjustable rate mortgages, so as to reduce their monthly costs. Here is an actual quote from Greenspan, extolling the virtues (vultures) of innovative mortgages. IT IS A SHOCKER, from a modern day John Law, who assisted in the transformation of the USEconomy into a giant hedge fund. Its foundation sits atop bubbles. Remember the two concepts Alan loves the most. That "innovation" is just another misleading term for broadened leverage to ramp a particular market. That "productivity" refers to more computing power for program stock & bond & derivatives trading (to earn fees), to displace workers (ending employer labor costs & fringe benefits) in the age of the great financial engineering miracle. Or is it a miraculous destruction? Would Sir Alan recall his words? Would he be proud of them? Methinks no and no. Why was he knighted by the Queen? Could it be because he helped bring down the US challenger to Old Europe? The lost US manufacturing base is a direct consequence of chronic inflation topped off by Greenspan policies. The housing bubble is one of Greenspan's more direct accomplishments. Decide for yourself.

"Innovation has brought about a multitude of new products, such as subprime loans and niche credit programs for immigrants… With these advances in technology, lenders have taken advantage of credit scoring models and other techniques for efficiently extending credit to a broader spectrum of consumers… Where once more marginal applicants would simply have been denied credit, lenders are now able to quite efficiently judge the risk posed by individual applicants and to price that risk appropriately. These improvements have led to rapid growth in subprime mortgage lending,… fostering constructive innovation that is both responsive to market demand and beneficial to consumers." -- Alan Greenspan, April 2005

The reality is that innovation efficiently grew a dangerous reckless housing bubble, using the bizarre financial engineering alchemist tools to corruptly leverage the inflated (crowbar cranked as in amphetamines) construction into a monster which is now exploding, taking down everything tied to it. Credit scoring models were uniformly abused to grant loans to unqualified buyers who now are losing their homes and invested equity. Risk was systemically improperly priced. It fostered destructive innovation to cater to market demand in predatory fashion, to the detriment of consumers. What resulted was a temporary bailout from the 2000 stock bust with a Greenspan signature, followed by a greater housing bubble & bust with added Greenspan fingerprints, and a highly mysterious continued ongoing unjustified adulation admiration and worship of a knighted serial bubble engineer!!! He is celebrated much like the village drug dealer, only to escape criticism when the addict is down & out.

The current housing bubble & bust serves as vivid testimony of the failure and inability for free people to manage money and a monetary system, without the discipline and rigorous enforcement of a gold standard. When we run out of new available bubbles to puff, we will earn a new system, which is most likely to be less friendly and less gentle with liberties and freedom. Like now!

Greenspan was responsible for creating the mess, now he leads interference for reactive policy change. He has talked about a recession likelihood, but continues to deny a spillover of the housing debacle into the real economy. More accurately, he awaits the spillover. One should regard the Greenspan role as carefully orchestrated, not by any means accidental. He has created the psychological backdrop perfectly for Bernanke to cut official interest rates. Ben needed a shock to stocks, a change in sentiment and outlook. He got it.


From the Jim Willie article at the competing castle (Willie/mar142007.html)

TannehillGoldilox @ Thieves drag gold from museum#1534843/18/07; 20:48:19

informally known in the business as the unwinding of the gold "carry" trade. :-)
Goldilox"Carry" trade#1534853/18/07; 21:41:47

@ Tannehill,

Between your pun and my Dad sending me the latest "Idiot Sightings", my day is complete!

mikalCarry trade and gold spade#1534863/18/07; 22:03:02

When the yen carry trade DOES start to unwind, we'll know and it could take a year or more.
Sir Alan Greenspan says that rising gold prices are not an indication of increasing inflationary pressures.
On the face of it, this seems as numbnuts as saying
the stock market now moves (in tandem) with gold or
that gold is a risky, not hard asset, that's being shed,
along with others in times of instability and volatility.
But Sir Alan knows better than that.
He knows gold is the ultimate form of international settlements and POG has been rising relentlessly
in trend since 2001(and in earlier periods).
He knows we Americans are endlessly told inflation is 'contained'- as Chairman Mao Tse Greentung he called it by various euphemisms.
He knows the Fed's monetary stimulus is still in overdrive.
Characteristically, he knows gold DOESN'T indicate inflation YET- while he kept his NOSE clean(out of trouble)amongst the banking fraternity so far, could he be nosing around in dangerous regions with quotes such as these?
Or is it just that he possesses a good nose for the direction of gold in an enhanced international monetary system?

mikal@Tannehill, Goldilox#1534873/18/07; 22:26:23

@Tannehill- We know the goings on in Asia carry much weight, but this is too much!
@Goldie- Re: "my night is complete"
If you must, but please consider that you may have gotten carried away just a tad. MK is not alone in insisting we "carry on"!

mikal@Tannehill#1534883/18/07; 22:32:38

Your "Carry trade"- Great pun!
SundeckHumour#1534893/18/07; 22:37:10

The humour on the forum is deteriorating. Please try not to get carried away. Just stick to the gold, hard facts... Au I'll get Agrivated...


mikalGold carries the day#1534903/18/07; 23:01:33

Intelligent analysis, though as a letter may have been edited. Omits the issue of gold entirely and assumes that the Forex markets and equity must have equal footing in future deliberations upon volatile economic events like those we've just seen. / Comment & analysis / Letters - Focus on yen carry trade limits discussion to forex market - Mar 19, 07

spotlightGreenspan quote#1534913/18/07; 23:02:59

There are those I told of your Grenspan quote who demand your source. Can you provide it please?

"Innovation has brought about a multitude of new products, such as subprime loans and niche credit programs for immigrants… With these advances in technology, lenders have taken advantage of credit scoring models and other techniques for efficiently extending credit to a broader spectrum of consumers… Where once more marginal applicants would simply have been denied credit, lenders are now able to quite efficiently judge the risk posed by individual applicants and to price that risk appropriately. These improvements have led to rapid growth in subprime mortgage lending,… fostering constructive innovation that is both responsive to market demand and beneficial to consumers." -- Alan Greenspan, April 2005

mikal@Sundeck#1534923/18/07; 23:19:42

Re: "gold, hard facts" and "Aggrivate" Gold is hard yes, silver too, but only one is known as the warm metal. 'Hard cold fact' or two- I didn't want to be left out in the cold so I put both in cold storage and one or two of them is going to keep me out of hot water.
I don't wish to Aggrivate you, but one will surely be HOT, and the other not as hot and so some may turn a cold (shudder) shoulder to the other, brother.

GOLD FINGERI found iT~#1534933/18/07; 23:57:21

spotlight (3/18/07; 23:02:59MT - msg#: 153491)
Greenspan quote

Who really cares what he has to say anyway. Some do not like him and think he is far to political anyway. I mean who is he trying to save? The country? The world? Or just a few???


SmeagolGreenspan quote#1534943/18/07; 23:57:26

Will thiss do, Ssir Spotlight? ~8-)
GoldiloxSir Greenspan#1534953/19/07; 00:29:23

@ Gold Finger,

After 20+ years of so many people riding his every burp and flatulence as a "market sign", GS is probably convinced that his "leadership" is still intact.

Or, he perhaps he is trying to assuage his pangs of conscience.

"Who knows what evil lurks in the hearts and minds of men?"

GoldiloxBarrick quashes $25bn Newmont bid rumour#1534963/19/07; 00:57:57

Seems like someone with press connections may have had some Newmont call options to dump before Friday's equity options expiry and invented a rumor that bumped them long enough to unload profitably.

For those who don't regularly watch the paper market shenanigans, this is one of the games the hedge funds play, and is RARELY ever noticed by the SEC.

spotlightGreenspan's speech#1534973/19/07; 01:33:39

Yes it will do nicely.

USAGOLD / Centennial Precious Metals, Inc.Has gold market volatility changed the fundamental reasons for physical gold ownership?#1534983/19/07; 05:04:37">gold and volatility
contrarianGreenspan Signature#1534993/19/07; 05:08:09

Goldilox--Thank you for an astute post--the financialization of the US economy and the destruction of the manufacturing base--essentially the destruction of the US economy, as paper and balance sheets go up in flames.

Beyond Greenspan (as he has always been known as a social climber) I'm still trying to figure out who is the shadowy entity untimately responsible for all this--pulling the strings. Is it the Council on Foreign Relations? Is it the Anglo-Dutch synarchists, as LaRouche claims? Is it the Rothschilds? Is it the Vatican? Is it the Illumaniti? I would be curious to hear what other think.

Nevertheless, the goal has been the complete and total destruction of the United States, from which will spring forth the foundation of the New World Order, like an acorn split open by the winter cold and germinating into a brand new sapling.

TownCrierBen Stein: How Not to Ruin Your Life -- The Long and the Short of Down-Market Investing#1535003/19/07; 05:18:46

(Stein) March 16, 2007 -- ...right now I'm moved by the stock market's continued gyrations downward to say a few deathless words on that subject.

A Bank or a Casino?

Let me explain a few basic things about the stock market. It exists for a variety of reasons. For one thing, it allows entrepreneurs and established companies to raise money for factories and laboratories and mills and mines.

It also allows small and large investors like you and me to purchase stocks to place long-term bets on the economy. We buy into America's industrial growth, and help it propel us into retirement and prosperity. The stock market allows this.

But the stock market is also a vast casino for the people who work in it. They play feverishly, trying to make a dollar or two (or a million or a billion) via short-term trades. They sell short, buy and sell options, use trades so complex they break computers -- all to make a quick buck.

In particular, they can make money by selling short and using "sell programs." These allow traders to make money as markets fall, just as we long-term investors make money by holding on for the long run.

These trades should be totally irrelevant to us long-term investors, except for one thing: Sometimes, when the traders and gunslingers drive down the price, they give us a chance to buy into long-term growth on the cheap.

As I've said before, if the market sells itself down a few percent or more, why not take advantage of the sale the same way you would a sale on paper towels or a washing machine? It's the same market, and eventually the traders will decide to start their manipulations to make the market go up. And there we'll be...

^___(from url)___^

Those excerpts are about all that you'll find helpful in this one. For the most part, Ben Stein is behaving as a bona fide cheerleader for Wall Street and is herein supporting the status quo of the financial corps.

In spite of the headline, for the most part, he seems hell bent on herding people toward the ruin of their life.


GoldiloxThe man behind the curtain#1535013/19/07; 05:53:40

@ Contrarian,

It seems a major theme in post-monarchic society was that expressed so eloquently by L. Frank Baum, "Pay no attention to the man behind the curtain".

Again in "Swordfish", the theme was "misdirection", refocusing attention to an event that distorts one's entire perception of the whole.

Those who would have us believe "all is well, and FIAT is good", will continue to refocus the masses on effects and call them causes, destruction as the route to productivity, and promote divisive ideologies to keep us at each others' throats. When the game itself is threatened, they will offer up a compliant underling as a scapegoat for the masses to blame, and assure us once again that "all is well". Then they resume their game of "divide and conquer," endeavoring always to transfer political power to another "insider".

When no "insider" is available, the only answer is war and complete upheaval, as they care not for the welfare of mankind, only for their ability to maintain the "wizard's curtain" of control.

For those who think this idea radical, I submit that the very same "powers" who rallied the troops to stop Hitler, used the Great Depression caused by their raping of the Weimar Republic and speculative market greed to build his power base in the first place. Banksters lined up with ill-gotten gains from the Hoover-Roosevelt transition to finance the "economic miracle" of German recovery, as surely as they stood in line to pick the pockets of the public for the Cold War build-up and the post-Cold War "peace dividend".

The only theme that has remained constant is the continual debasement of currencies, allowing governments to "finance" that which they cannot really afford. The piper will be paid, but that part of the story must remain "behind the curtain".

GoldiloxUS 'resolves N Korea funds row'#1535023/19/07; 06:16:09


The US says it has resolved a financial row with North Korea, as talks on Pyongyang's nuclear programme resume.
The US said $25m of North Korean funds, which were frozen in a Macau bank amid money laundering allegations, would be transferred to an account in Beijing.

The North has not yet officially commented, but had warned it would not proceed with a deal to shut its nuclear reactor at Yongbyon without the money.

Delegates from the six nations involved in the deal are meeting in Beijing.

They are discussing progress on the 13 February agreement, in which Pyongyang agreed to "shut down and seal" the Yongbyon reactor within 60 days in return for substantial fuel aid.


Interesting that these funds were previously revealed to be tied to North Korean gold production, which is NOT mentioned in the article. Instead, it tries to make it all about shutting down the reactor sold to them by Rummy and his Swiss financiers in the 1990s. It seems McCanney may be correct that they will be allowed to re-enter the gold business if they willingly exit their competition with the western nuclear fuel cartel of the US, Russia, and France.

contrarianThe Man Behind the Curtain#1535033/19/07; 06:26:48

Goldilox--How true. You never read in the papers about the real powers behind the scene. They make sure they are never seen, never heard. "Who was that? I don't know. They vanished!"

And most certainly, when all else fails, the war card is played. Usually along with the false flag--to distract and deflect righteous wrath--to stop payback to the true criminals and instead assign blame elsewhere.

Whoever are the real powers behind the scenes, it has to involve money, as money is the root of all evil--especially fiat money. I would call the paper pushers the greatest evil the world has known--ultimately responsible for untold suffering and destruction--millions dead, hundreds of wars and battlefields. When money is no object, who's to stop them?

GoldiloxEarly smackdown#1535043/19/07; 06:38:40

Paulson's Pirates are up early this morning. The gold spanking started right at the COMIX open.
slingshotWall Street Crossroads#1535053/19/07; 07:24:56

Opening up on Wall Street.

slingshotRate Cuts.#1535073/19/07; 08:00:32

Fed May Lower Rates Three Times on Housing Woes, Options Show

By Daniel Kruger

March 19 (Bloomberg) -- Options traders are starting to say the Federal Reserve may cut interest rates three times this year as the housing slump threatens the economy's growth.

Options on Federal Fund futures at the Chicago Board of Trade show a 24 percent likelihood the central bank will lower its target rate for overnight loans to 4.5 percent from the current 5.25 percent. Just seven weeks ago, options prices suggested no chance of that large a reduction this year.

Federal_ReservesSee Me, Touch Me, Feel Me, Steal Me.....#1535083/19/07; 11:49:31

Gold theft in a Japanese museum

The museum left the safe open so that visitors could touch the gold. Three masked men have stolen a massive block of gold bullion on display in a museum in Japan. The gold bar, valued at $1.71m (1.27m euro; £0.87m), weighed about 220 pounds (100kg) and was kept in an open safe.

The museum, in the central city of Takayama, said the gold was not protected by sensors as they wanted visitors to be able to touch it.

But the group of thieves went one step further, helping themselves to the precious metal and dragging it away.

The gold was lugged past an employee alerted by the noise, down a staircase and out of the museum where the three men were driven away by a fourth accomplice.

mikalDollar dog tag days #1535093/19/07; 13:04:07

Headlines like this do affect global sentiment towards the dollar, towards dollar-denominated investments, towards gold and you guessed it, towards the dollar/gold relationship..............................................
Monday, March 19, 2007 -

Four years after the invasion of Iraq, the high and growing demand for U.S. troops there and in Afghanistan has left ground forces in the United States short of the training, personnel and equipment that would be vital to fight a major ground conflict elsewhere, senior U.S. military and government officials acknowledge. -Washington Post

Click Here For The Full Story

mikalBaa, baa, black sheep, have you any wool?#1535103/19/07; 13:18:07

More actions that invites censure, any one of which could trigger a paradigm shift in attitudes, in the financial order and in the global system of payments. Torn within and increasingly isolated without,
there appear signals by global sanctioning bodies to herd US back into the fold.
Monday, March 19, 2007 -

A consensus on the need to protect the world's environment is emerging among rich and developing countries, but the US remains at odds with other nations on key points, Germany's Environment Minister has said. Environment ministers of the Group of Eight leading industrialised nations, and officials from leading developing countries, were meeting to prepare for a June G8 summit where they plan to discuss specific targets for protecting the environment. -SMH

Click Here For The Full Story

melda laurePeople act.#1535113/19/07; 13:33:41

@ Contrarian.

The answer is Yes.

To paraphrase Mises: "TPTB act". The only difference is where you or I must act within the limits of our means, they seem to be able to re-gauge the entire economy (via perceptions, etc).

"men will not die for good causes, but they sometimes will do it for a bit of yellow ribbon". While it is true that perceptions will not put food on the table, that is only so because first you must scare the congress into an "appropriation response". Perhaps we are not asking the correct question yet. Is it all about money? Or is inducing this dark energy of fear partly the whole reason for being? Perhaps in addition to "who are they", we might ask "what are they?"

I'm afraid this is not very helpful.

melda laureWas subprime due to derivatives?#1535123/19/07; 13:38:03

Did a sizeure in credit derivatives halt the subprime market?

If so can it be unstuck? Or is the whole CMO machine counting down to "warp core breech"?

mikalAnother week, another step closer#1535133/19/07; 13:53:46

This week the Bank of Japan meets on interest rates and the FOMC meets on Tuesday and Wednesday with the statement on rates expected about 2:15 PM EST. Also a bit of economic news such as some housing stats. This is a small sample
of significant events just this week alone will bring.
For example, a reappearance of Iran's leader for another speech in NY at the UN and subsequent headlines on this and sanctions. In the days and weeks to come, this may be overshadowed by divisions in the Security Council as they seek to agree on what to do, if anything, about Iran and their "fiery" leader.
At the very least, this is spelled GEOPOLITICAL TENSION:

Security Council braces for sanctions showdown with Iran leader | Gerard Aziakou | Sun Mar 18, 2:29 AM ET -- Excerpt:
UNITED NATIONS (AFP) - The UN Security Council braces this week for a dramatic showdown with Iranian President Mahmoud Ahmadinejad over a vote on new sanctions to prod Tehran to comply with demands that it suspend uranium enrichment.

South African Ambassador Dumasani Kumalo, who chairs the 15-member Council this month, said Friday there had been no objection from members to a request by the mercurial Iranian leader to attend the session at which a new draft sanctions resolution is to be adopted.

The full council was set to meet Wednesday afternoon to review the compromise text agreed Thursday by the council's five permanent members -- Britain, China, France, Russia and the United States -- plus Germany.

A vote on the draft, which toughened sanctions already adopted by the council in December, was likely to follow a few days later, diplomats said."

USAGOLD Daily Market ReportPage Update!#1535143/19/07; 13:55:10">
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

March 19 (MarketWatch) -- Gold futures posted a small gain Monday, taking their three-session win to almost $12 an ounce as traders eyed upcoming U.S. economic data as well as a decision by the Federal Reserve on interest rates due later this week.

"Traders were on economic-data watch," said Kitco's analyst, Jon Nadler. But "buoyancy in the dollar kept a lid on fresh longs."

Gold for April delivery rose 40 cents to close at $654.30 on the New York Mercantile Exchange, its strongest level since March 8. Prices peaked at the $656 level earlier. The contract had also dipped to a low of $652.80 Monday as the dollar rose against major counterparts in the foreign-exchange market.

But on Friday, the metal had rallied 1%, adding $6.80 to close at $653.90, and the contract is up 1.8%, or $11.80, from Wednesday's closing level.

The Federal Open Market Committee, the Fed's policy-setting panel, starts its two-day policy meeting on Tuesday. Economists believe the Fed will almost certainly keep monetary policy on hold for the sixth consecutive meeting, maintaining its federal funds rate target at 5.25%.

The Fed will announce its decision at 2:15 p.m. Eastern on Wednesday.

Nadler said a rate adjustment is not expected at the coming Fed meeting, thought a cut is possible at the next meeting.

"There is no doubt that the folks with their fingers on the interest rate faucet are having a tougher time steering the economy by relying on old tricks," Nadler said.

Even so, "a rate cut in the U.S. dollar would likely encourage sidelined metals buyers and current dollar holders to bite the bullet and start buying [gold] once again," he said.

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

flow5Yuan#1535153/19/07; 14:48:12

China Hikes Rates To Slow Lending, Stocks Its third rate hike in 11 months comes amid signs that the torrid pace of investment growth isn't letting up. Click the link below to read the full story:
additional gold support

flow5China's Rate Hike#1535163/19/07; 15:04:59

China: Rate Hike for a Hot Economy

mikal@melda laure, Contrarian#1535173/19/07; 15:40:55

Derivative doo doo smelling up far beyond the mortgage industry:
Restructuring industry foresees wave of insolvencies
Mon Mar 19, 2007 4:00am ET - By Elena Moya
Snippit: CAPE TOWN, March 19 (Reuters) - A new wave of insolvencies will hit markets over the next few months - with more parties willing to profit from the pie than five years ago, when a cycle change sent dozens of companies into bankruptcy.
More than 400 restructuring lawyers, accountants and bankers will debate in Cape Town, South Africa, over the next two days when the downturn is expected and who is going to profit most from it.

"People are definitely getting ready," said James Moylan, a managing director at Barclays Capital in charge of distressed debt. "We've seen pressure in the U.S. housing market. I suppose the market could turn quickly but default rates remain at all-time lows."
Concerns about the U.S. housing market have pushed down stock markets around the world but, still, ample liquidity and investor appetite is suppressing debt payment failures.

A sharp increase in defaults is not seen until next year, although pressure on sectors such as retail, chemicals and paper and packaging may mount over the next few months, market experts including credit rating agency Standard & Poor's have said.
"There's a huge amount of leverage in the system," Moylan said. "Leverage buy-out deals continue to go higher, that leaves them very susceptible to an economic shock."

Mikal -- Extensive mess yes? While I agree it's "about money" and "control", it's more about mistakes
wrought by this short-sightedness, greed, hatred, etc.
The capacity for mistakes is evident in such figures as the 60trillion$ future obligations US of A owes. The estimated 400 to 1900 trillion global derivative pyramid. The public, private and corporate debt overload, balance of payments, name the incipient crisis.

mikalMany markets overpriced, awaiting destiny#1535183/19/07; 15:59:56

Many markets are overpriced and could be sitting on a timebomb. Because they are elaborately interconnected with global markets, the US markets outlined below sent a twinge of fear through those unable to shed feelings of security invested psychologically and materially in the US economy's reputation and stability. But it the grace of God and gold that stays the hand that types this post. :)

Correction Injected a Healthy Does of Fear Into Extended Bull Market | Posted on Mar 19th, 2007
J.D. Steinhilber (Agile Investing) submits:
"A Healthy Does of Fear
What was more unusual than the sharp recent stock market decline was the length of time that markets had steadily risen without any sort of correction. Volatility has now returned after a period of very unusual calm, and we do not expect markets to revert any time soon to such low levels of volatility (e.g. VIX readings near 10, which are historic lows, for the six months leading up to this correction).

This correction is potentially constructive in that it is washing away some of the excesses and injecting a dose of fear into investors who had become too bullish and complacent about risk assets. A variety of shorter-term sentiment gauges have quickly shifted from complacent to fearful readings, which will likely serve to limit further near-term declines. But it is hard to argue at this stage that risk aversion has returned in any significant way to the financial markets. We have had only a modest, brief correction in stock prices after an extremely long rally, and credit spreads between U.S. Treasuries and junk bonds and emerging-market debt remain near record-tight levels.

It is notable that the market is suddenly fixated on issues such as mortgage-lending problems and the potential unwinding of the yen carry trade. These issues have been hanging over the markets for quite some time, and now they are on the front pages and are shaping market psychology. Psychology can, in turn, influence the fundamentals, and if confidence deteriorates and longer-term risk aversion builds in the weeks and months ahead, that development in and of itself could make an important difference in the performance of risk assets and the economy at large."

melda laureRumours of an early demise have been exaggerated.#1535193/19/07; 16:39:29

"We want to assure homeowners that there is still an extensive selection of mortgage loans to suit a multitude of personal and financial circumstances," said Tom Hunt, managing director of Countrywide Home Loans. "We recognize it's been widely reported that some major lenders, like Countrywide, no longer offer 100% financing. In fact, we have made changes to certain subprime and other special mortgage programs, but we have not eliminated 100% financing. We still offer one of the widest selections of low- and no-downpayment options to qualified customers, including those with less-than-perfect credit."

The pause in gold prices may be altogether unwarranted. Perhaps this was only the first shakeout; give it another 3 months and we'll see who's left standing.

Paper AvalancheQuietly creeping back on to the launch pad#1535203/19/07; 16:40:33

With little mention or fanfare gold has crept its way back to the edge of uncharted territory.

$650 looking more like a floor instead of an obstacle.


Paper AvalancheWe Tied 1980 Record for Days POG Closed $650+#1535213/19/07; 17:31:14

Today gold closed over $650 for the 27th day this year.

In 1980, gold closed above $650 only 27 trading days.

In 2006, gold closed above $650 only 22 trading days.

Tomorrow we may set a new record and cross yet another milestone in POG history.


ThoreaulyCan't post#1535223/19/07; 17:44:52

I've tried numerous times to post a message and can't do it.


ThoreaulySee!#1535233/19/07; 17:46:42

It'll post these but not one that contatains a few URLs.


Chris PowellJim Cramer explains on TV how to manipulate the markets#1535243/19/07; 19:19:20

9:11p ET Monday, March 19, 2007

Dear Friend of GATA and Gold:

A video interview conducted with CNBC market guru and former hedge fund manager Jim Cramer by Aaron Task of "Wall Street Confidential" on is flying around the Internet, and with good reason.

In the interview, conducted December 22, 2006, Cramer candidly explains how hedge funds and other big stock traders such as he used to be aggressively and profitably manipulate markets, indifferent to the law and government regulators.

The interview is a little longer than 10 minutes and you can watch it at YouTube here:

A description of the interview that allowed your secretary/treasurer to date it can be found at SeekingAlpha here:

If you want to understand what has been called the financialization of the United States, the looting of the country and the destruction of its productive capacity and working class by the financial elites that have taken over the government, you should watch this.

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

MKChris. . .#1535253/19/07; 19:28:19

You watch that interview and you realize that owing stock -- any stock -- is the game of fools. As an owner, you become a sheep in line to be sheared. . . . .very revealing. A life lesson for those who choose to accept it.
MKAnd I should add. . .#1535263/19/07; 19:31:02

A very strong argument for gold ownership.
Chris PowellLearning from Cramer#1535273/19/07; 19:35:21

MK, I was going to add to that dispatch
the very conclusion you drew -- that
metal in hand is the only security and
that the rest is speculation -- but I
had spent an hour sourcing the
interview and was rushing to get it
out. Good thing you're here!

Chris PowellArabs again test whether their dollars are any good in U.S.#1535283/19/07; 19:36:13

Dubai Aerospace in Talks
to Buy US Defence Assets

By Lina Saigol and Stephanie Kirchgaessner
Financial Times, London
Monday, March 19, 2007

Dubai's ruling family is set to acquire a series of aerospace and defence businesses across the US which will test the country's readiness to entertain Arab owners of infrastructure assets in a deal which could be valued at more than $1.5 billion.

Dubai Aerospace Enterprise, which aims to create a $15 billion aerospace and aviation services company, is in advanced talks with Carlyle, the private equity firm, about acquiring part of Landmark Aviation and Standard Aero, which both provide engine repair and overhaul aviation services.

DAE, which is chaired by Sheikh Ahmed bin Saeed Al Maktoum, chairman of the Emirates airline group and president of the Dubai department of civil aviation, is interested in buying only Landmark's maintenance, repair, and overhaul services business.

In September 2006, DAE teamed up with Abu Dhabi to acquire Zurich-based SR Technics, the world's leading independent provider of aircraft MRO services for around $1,334 million.

The potential deal is likely to face tough scrutiny in Washington, where a bid for the takeover of five US port terminals by another state-owned company, Dubai Ports World, was scuppered following a congressional backlash last year.

Chuck Schumer, the New York Democratic senator, who led the opposition to the Dubai Ports deal and earlier this year reiterated his criticism that the emirate had been at the "nexus" of terror finance, told the FT: "This purchase is not as much of a security risk as Dubai Ports World, but because it deals with maintenance of aircraft, it certainly raises security questions."

Sen Schumer said if a thorough review of the deal was done by the committee on foreign investment, or Cfius, which vets foreign deals on national security grounds, "and necessary safeguards are taken, the deal is unlikely to have problems in Congress."

DAE and Carlyle are expected to request a full 90-day review by Cfius, which is controlled by the Bush administration.

Both parties to the potential deal are expected to show the US government that they are willing to agree to tough conditions to win approval, including a so-called "evergreen" clause, which would allow the government to unravel the transaction at any time in the future if the companies fail to comply with an agreed security arrangement.

Although the transaction does not involve the transfer of any classified defence information, any probe is likely to take into consideration lingering questions within some quarters of the Bush administration about the transfer of materials from the UAE to Iran.

The Dubai Ports World debacle last year exposed mixed feelings about the UAE -- specifically Dubai -- which is seen as an ally in the US war on terror.

MKOne more point, my old friend. . .#1535303/19/07; 19:42:05

We all gain power the result of your presence here.

Thanks, Chris.

Chris PowellYOU'RE thanking ME?#1535313/19/07; 20:12:21

Hell, MK, if not for the USAGold Forum,
I wouldn't have anywhere else to go. I'd
be out in the street!

Chris PowellInflation is eating U.S. wage gains#1535323/19/07; 20:57:16

By Mark Trumbull
Christian Science Monitor
Monday, March 19, 2007

Brian Fortinberry, who runs Front Range Barbecue in Colorado Springs, Colo., is feeling the brunt of a spike in prices.

Beef costs about 10 percent more than it did in January, he says. Fruit and lettuce are also pricier. Gasoline has gone up, adding to costs when his restaurant does a catering job. And Colorado voters just raised the minimum wage -- pushing up his payroll tab.

"We haven't increased our prices, but we're looking to do that," Mr. Fortinberry says. "Eventually you have to pass it along."

The economy may be a bit cooler than it was a year ago, but inflation is still running hot. It's not like the runaway price train of the '70s, but it's enough so that people notice at the grocery checkout, when they pay for day care, or when they buy college textbooks.

Some prices -- namely for housing, food, and medical care -- have been more noticeable than others of late, jumping at a 6 percent annual rate during the three-month period from December through February, the government reported Friday. Retail gasoline prices rose 7 percent in just two weeks, according to a March 12 report by the US Energy Information Administration.

Of course, not everything is getting more expensive. The core rate of inflation -- prices of all goods and services minus volatile food and energy -- has been edging up, not soaring, for the past three months. Still, at a 2.6 percent annual rate, inflation is hotter than Federal Reserve officials would like.

Economists are divided over what happens next. Some say inflation is bound to taper off -- though maybe not for some months -- as the ripple effects of a housing-market downturn cool the economy. Others say that rising prices will persist and that the economy, instead of cooling off, will run close to its speed limit.

"You're going to see continued [inflationary] pressure," predicts Michael Darda, chief economist at MKM Partners, an investment firm in Greenwich, Conn. "Firms will find the pricing power" to pass along increased costs. "I think it is a broad-based issue."

Doug Stoddard, who works at a computer job in Boston, doesn't need government reports to tell him about rising prices. He's seen them in numerous bills over the past year.

"Rent went up. Cable went up. My gym membership went up," he says.

His subway pass rose from $44 to $59 a month. And he's noticed higher prices for gasoline and groceries.

Mr. Stoddard figures that all this has outstripped the change in his income. Higher health-insurance costs alone ate up most of his last raise, he says.

Millions Americans face a similar touch-and-go battle to keep up with rising prices.

In the past two months, average weekly earnings have fallen in real terms (adjusted for inflation). That marks a reversal from last fall when, thanks to a dip in energy prices, real incomes were enjoying sturdy gains.

Consumers are being buffeted from several directions. The resurgence of inflation comes even as homeowners face a dip in property values and as the stock market has sagged from a recent peak. All this dragged consumer confidence down a notch in an index released Friday by the University of Michigan.

These economic crosswinds also pose a challenge for Federal Reserve policymakers. At a meeting Tuesday and Wednesday, they will weigh the risks to the economy -- whether the threat of inflation is greater than the opposing forces that could cause an economic slowdown.

Many investors have been anticipating that the Fed will cut its short-term interest rate later this spring. That would help ensure that the housing downturn doesn't push the nation into a recession.

To pave the way for such a move, the Fed could first announce a "neutral" policy stance, rather than its current inflation-fighting bias toward raising interest rates.

But the latest news on consumer prices is dimming hopes for both the tonal shift and a subsequent interest-rate cut.

Not everyone has given up on the possibility of some easing by the Fed. But it now looks less imminent.

"The Fed will be on hold for the balance of this year," predicts Carl Tannenbaum, chief economist at LaSalle Bank in Chicago. He says surveys of wholesale and retail prices "are suggesting that inflation is not entirely under control."

In fact, the Labor Department's consumer price index on Friday showed price momentum in a wide range of goods. Food, clothing, shelter, medical care, energy, and airline tickets all posted sizable gains in February.

Some of the recent price changes may represent one-time shocks. Beef prices are reacting, in part, to a devastating storm that buried cattle country in snow. The higher costs for fresh vegetables and fruits such as oranges can be attributed in part to bad weather. Oil and gasoline prices have gone up and down based on forecasts for demand, production quotas set by OPEC nations, and glitches at refineries.

But if the Fed doesn't need to worry about any one price, it does have the task of watching the overall price level. A loose monetary policy can allow a broader cycle of price hikes in the economy, damaging consumer and investor confidence. Such a spiral, once started, can be hard to stop.

The Fed wants "to maintain a healthy investment environment where investors are not seeing their ... returns eaten by rising prices," says Mr. Tannenbaum. That stability helps businesses create jobs and boost productivity, allowing workers' real income to rise.

Some economists say a cooling economy will help to tame inflation. Prices have been falling, in fact, for cars, computer equipment, and other categories that respond to cyclical swings by consumers.

Other analysts are skeptical that the economy is slowing down. Mr. Darda expects both output and inflation to show surprising strength.

"I think we're going to end the year with core inflation much closer to 3 than to 2.5" percent, compared with 12 months before, Darda says. The Fed may not act soon, but "the next move is probably a tightening."

GoldiloxRecord close#1535333/19/07; 21:10:23

@ PA,

Don't mean to burst your bubble, but $650 in 1980 dollars is a LOT more than $650 in 2007 dollars.


Gold is WAY undervalued at $650 in 2007.

slingshotInflation#1535343/19/07; 21:41:06

Like I have said before.

People are going to find out the difference between what they WANT and what they NEED!

OH, wait. There is no inflation if I don't eat or drive my car. Give up my cable you say?


GoldiloxThe Retirement Trap#1535353/19/07; 21:49:48


Walking into the Sunset

Wall Street continuously reminds us "Everything is Wonderful." As long as you keep buying its "investment products," you too can retire to a beautiful lake, just like those handsome senior citizen couples in the financial services commercials, walking hand-in-hand into the sunset. But in reality, storms are brewing over the horizon. Millions of Baby Boomers, even those who have saved hundreds of thousands of dollars, are likely to face a retirement of dwindling choices and lowered expectations. Ultimately, the stark reality is many, many retired Americans will face "Un-retirement," looking for work in their 60's and 70's to make ends meet.

The pitfalls of retirement are a subject you have likely read about, perhaps ad nauseum. But for most Americans, this subject cannot be discussed often enough, or emphasized loudly enough. The obvious approach is to start saving and investing, as much as you can. But for many it is easier said than done. Many Boomers have children at home and elderly parents they must look after. That is one of the demographic challenges facing this generation; having children later than earlier generations and seeing the costs of child rearing skyrocket, along with medical care costs for their own parents. There are also cultural factors at work. Baby Boomers, un-chastened by the Depression that defined the lives of their parents and grandparents, have pretty much lived for the moment. And they have been encouraged to do so every step of the way by Madison Avenue and the televised popular culture.

Given that background, many Boomers look at retirement planning as a necessary evil, and something to be ignored if possible. Those who are more involved often see their future as an extension of the past, projecting their retirement based on the past 25 years, an era of uncommon prosperity, characterized by falling interest rates. The Retirement Trap can be avoided, but a clear-eyed, sober view of reality is an important place to start.

Beware the "Conservative" Portfolio

I frequently mention to clients nearing or in retirement that they can't enter their golden years relying solely on the purchasing power of a fixed amount of US dollars, looking forward to a 20 to 30 year retirement. The two-headed monster of a future currency devaluation and future inflation make fixed income assets questionable at best. The only way the US government is going to meet even a portion of its trillions in unfunded liabilities is to print vast, unimaginable sums of currency. Financially, those liabilities cannot be paid without massive tax hikes and severe budget cuts. Politically, that will be impossible to implement. But the currency will be printed. The currency's purchasing power will be another matter.

Millions of Baby Boomers, as well as older retirees today, will rely on fixed annuities and long term bond portfolios to survive. Unfortunately, this fixed stream of US dollars will be at a growing risk of currency debasement and inflation. Over long retirements, 20 years and more, Boomers will face the horror of eroding purchasing power, and by extension, an eroding quality of life. The "conservative approach" may have worked in the days when our nation produced more than it consumed. But those days are gone. We as a nation have consumed the wealth created by our forefathers.

This is the reason I believe a fixed-income "conservative" portfolio, denominated solely in US dollar assets at retirement is not conservative at all. It's a gamble that the US dollar will not lose its purchasing power at an accelerating rate. That is a gamble most retirees cannot afford to take.

(Insert $INDU:$GOLD chart here)

Think of this chart like the exchange rate between two currencies. What this chart shows is the DJIA depreciating relative to gold. In 2000, gold was 1/44th a share of the DJIA. Today, gold is now worth 1/16th of a share of the DJIA, meaning it now takes far less gold to buy a share of the DJIA than it did six years ago due to the depreciation of the dollar. This shows the importance of looking at one's assets in terms of purchasing power, not just how they are doing in US dollars.


Nothing new here, but a good presentation.

mikalBarking up the wrong tree#1535363/19/07; 22:57:58 FOMC to Help Spot Gold Breach Resistance - Westpac | March 20, 2007 9:12 HKT | Dow Jones Newswires | Quamnet

Read what it means to be a deluded journalist advocating "free, open, but orderly markets". Their masters can't help themselves when it comes to tipping their hand on their true gold proclivities- fear and lust, and now panic.
Dow Jones lapdogs know who calls the shots but they
play the top dogs when the tail is wagging the dog.

P.S. Another great MK report at the forum!
Midas report at beginning to outdo itself regularly. You'd better believe when I say,
the more that read it, the better!
Link below courtesy of the patrons and sponsors of one of the world's finest news feeds @

mikal@Thoreauly, slingshot#1535373/19/07; 23:19:55

@Thoreauly - Sorry to hear that. Keep trying.
@slingshot - Good points. As for cable, will be interesting to see if gubbermint information ministry doesn't find a use for it. Perchance some philanthropists and foundations with their think tanks could help shephard something through Congress if the president didn't make it a priority. After all, the cost is minimal after the equipment is installed and there's no shortage of reruns to lull the sheeples. It could be sold as a public service like food stamps but you wouldn't need to 'qualify'.

GoldiloxThe future of cable#1535383/19/07; 23:29:51

@ mikal,

I think the future of interactive cable was already demonstrated in Bradbury's "Fahrenheit 451"

"Tonight's 'starring role' will be played by [insert subscriber name here]."

GoldiloxThe Great Global Warming Swindle #1535393/19/07; 23:46:13

How does an "environmental lobby" become a media scare? How much government funding is totally dependent on "toeing the dogmatic line"?

Interesting video.

melda laureWe seem to have many hoaxes.#1535403/20/07; 00:41:05

And while were on that topic, here's a twist on the whole abiotic oil: It seems Mr Thomas gold may have had a bit of research help from some russians.

I express no opinion on the source, but as our host has expressed doubts about the whole peak oil meme, and as nobody has posted any half way decent link to any alternative theories that have even a shred of plausibility, here at least is a start. Of course someone will have to do a good bit of following up on the threads here.

As to the whole abiotic issue, I could hardly care. The question always boils down to: "how much of that is recoverable?" After all, we are told that Triton is loaded with lakes of liquid methane- way out around Saturn somewhere.

Regardless, digging up treasures will always be more work than typing on a FED terminal.

Kiwi EnvoyJust sums things up nicely#1535413/20/07; 04:01:21

Hi all, here is an article I found whilst browsing lately about my favourite subject of gold.

IMO I dont see the general population in the US ever believing that gold is better than the greenback, so it will make the whole exercise of the plunge protection committee last that much longer...and of course resulting in gold going that much higher.

The thing I cant figure out is why are the "all so educated types" expounding the US economy as being in good shape.

Maybe they dont fear the gallows; like what has just happened to Saddam's Vice President yesterday.

Is it a long stretch (no pun intended)to think that Bernanke and Paulson won't end up in prison...on death row...with a rope around their necks.

Between helicopter Ben and BIG RIP OFF Goldman Sucks merchant Paulson they have both willingly destroyed the future livlihoods of many good Americans, Australians, New Zealanders etc etc with the continual flooding of the world with US dollars.

Kiwi Envoy

USAGOLD / Centennial Precious Metals, Inc.A combo of assets and info assembled especially for those who are taking their first step...#1535423/20/07; 04:32:20">gold ownership starter kit
Sierra MadreKiwi Envoy: a response to your thoughts#1535433/20/07; 04:40:34

You wrote: "IMO I don't see the general population in the US ever believing that gold is better than the greenback, so it will make the whole exercise of the plunge protection committee last that much longer...and of course resulting in gold going that much higher."

It is NOT an encouraging thought, but my experience shows me that you are probably right, in a certain sense, that "the general population in the US [will never] believe that gold is better than the greenback..."

The problem is, people have to make a living, have to earn their daily bread, or come by it somehow, and gold is just too scarce and valuable for daily use in small operations.

In the abstract, people may accept that gold is superior to paper money, BUT, their belief will not translate into a desire to hold some gold, because Americans are generally people in a hurry, in a rush to make some money, and holding gold is simply, boring - it's not doing anything and Americans are impatient. They want action, not a hoard of gold coins!

Silver might still, very probably, come back into circulation, as it is more abundant. Silver has for centuries been the everyday-money, and could, I believe, easily come back into circulation.

Gold is for large transactions, for wholesale payments, large contracts, long-term bonds, etc.

My grandfather lived through the gold standard era when the dollar was 1/20.67 of a Troy ounce (one ounce Troy of gold=$20.67 Dollars) and I really don't think he ever saw a gold piece more than a few times in his life!

However, we have to take into the account that a huge learning experience awaits the American People! This will be most interesting to watch, from the safety of gold holdings well stored away. When FEAR raises its ugly head a little ways down the road, where are the wealthy and the wealthy-wannabees going to turn? This is a new experience for two or three generations of living Americans! Since 1945, the USA has had the world at its feet. Living Americans have never known FEAR. The Depression Generation is now an insignificant factor.

Greed is strong but FEAR is mighty! Let's watch that learning experience! Will it be Euros or gold, or both?


968Qatar Triples Gold Reserves to Protect Against Dollar #1535443/20/07; 04:43:28

By Matthew Brown

March 15 (Bloomberg) -- Qatar tripled its gold reserves in January from the previous month to protect against a weakening dollar.

The Persian Gulf state, owner of the world's largest single natural gas field, increased its holding of gold to 158.1 million Qatari riyals ($43.4 million) from 44.3 million riyals in December, the Qatar Central Bank said in its monthly bulletin. Foreign currency reserves fell 1.5 percent to 15.5 billion riyals in the same period.

Qatar joins oil producers including Iran, Venezuela, Indonesia and the United Arab Emirates, looking to shift their currency reserves out of dollars or sell their oil, currently priced in dollars, in euros.

``Qatar and other central banks have indicated that they are looking to diversify their reserves as the dollar weakens, to protect the size of their reserves in non-dollar terms,'' Monica Malik, an economist with Standard Chartered Plc, said in a telephone interview from Dubai, United Arab Emirates, today.

The dollar traded at 1.3216 against the euro as of 8:05 a.m. in London, compared with 1.3223 last yesterday.

Gold spot prices jumped one tenth of a percent immediately after the statement. It was trading up 50 cents at $645.20 as of 07.45 a.m. in London today.

Calls to the Qatar Central Bank this morning were not returned.

Oil Revenue

The United Arab Emirates will convert 8 percent of its foreign-exchange reserves to euros from dollars before September after the U.S. currency slumped in the last year, the country's central bank governor said Dec. 24.

Gulf Arab energy producers will earn as much as $500 billion from oil sales this year, the International Monetary Fund forecasts. The region's central bank reserves represent a fraction of the currency holdings of state-owned investment firms such as Abu Dhabi Investment Authority which is estimated to have over half-a-trillion dollars under management.

The dollar fell 9.4 percent against the euro in the past 12 months, partly as a result of the growing U.S. current account deficit, the broadest measure of U.S. trade with the rest of the world.

Central Banks have contributed little to the price of gold, which has risen for the past six years. Gold holdings at central banks last year were the lowest since 1948, according to World Gold Council and International Monetary Fund data.

``There is a lot of speculation some major central banks out of Asia or emerging countries will be increasing their gold position,'' said Markus Bachmann, manager of the $280 million Craton Capital Precious Metals Fund in Johannesburg. ``I'm very cynical of those views.''

To contact the reporter on this story: Matthew Brown in Dubai, United Arab Emirates, at This email address is being protected from spambots. You need JavaScript enabled to view it. .

TownCrierFormer Head of Citibank Commodities Desk Gets 15 Years#1535453/20/07; 05:37:10

Corporate Crime Reporter; March 19, 2007 -- David Becker, the former head of the commodities trading desk at Citibank NA, was sentenced to 15 months in prison.

In September 2006, Becker pled guilty to scheming to inflate the trading profits of the Citibank commodities desk by as much as $20 million during 2003 in order to enhance his apparent job performance and his eligibility for bonuses from Citibank.

...inputted false data into a computer model used to estimate the value of positions held by the commodities desk.

...also input fictitious options trades into the computer model in order to reduce reported market risk and increase reported profits.

...also directed a broker at an independent commodities brokerage firm to supply false market quotes to the Citibank financial control department in order to undermine its monitoring of the Citibank commodities desk.

^___(from url)___^

Even though it comes under the heading of "commodity" market, the shenanigans at play are mostly paper, and, as a participant attempting to diversify your portfolio, you don't truly have wealth and security via this arena until your diversification strategy takes you firmly into the realm of tangibles.

Choose corn and copper if you'd like, but for storage efficency and for liquidity, gold reigns supreme. The choice is yours.


Paper Avalanche@ Goldilox#1535463/20/07; 05:53:37

Agreed. The $650 figure is in nominal terms, and not inflation adjusted. However, TPTB know that the sheeple will respond en mass when new nominal records ($850) are eclipsed regardless of what the inflation adjusted price really should be. To that end POG must be contained in terms of nominal price to control Joe Six-Pack's expectations and deesires. It appears that the ability to even do that is becoming more difficult by the day.


TownCrierGold steady, investors look to US rate verdict tomorrow#1535473/20/07; 06:23:15


The FOMC's two-day meeting on interest rates starts today, with analysts looking for any hint from the central bank over where rates are headed in the coming months.

Although most expect the committee to leave rates unchanged when they announce their decision tomorrow, cuts are expected later this year, which would pressure the dollar downwards, a bullish move for gold.

^___(from url)___^

As will all things, to get the best price, you need to take action ahead of the trend -- ahead of the masses.


Chris PowellNew York Post: Cramer reveals a bit too much#1535483/20/07; 06:55:25

By Roddy Boyd
New York Post
Tuesday, March 20, 2007

Flamboyant Wall Street trader turned TV host Jim Cramer, not known for being the shy, retiring type, might have said too much in a video interview he did for a financial Web site.

The host of CNBC's daily program "Mad Money" had hedge fund-trading desks buzzing yesterday after he bragged about manipulating stock prices during his days as a trader.

In the video from's "Wall Street Confidential" Webcast, Cramer boasts about manipulating the price of a high-flying stock down, and even acknowledges that doing so might have been illegal. The video is making the rounds on YouTube.

"A lot of times when I was short, I would create a level of activity beforehand that would drive the futures. ... It's a fun game," Cramer said in the Webcast, which was moderated by Executive Editor Aaron Task.

Cramer later said that "no one else in the world would ever admit that, but I don't care."

However, seconds later, he acknowledged, "I'm not going to say that on TV," referring to his show on CNBC.

A remarkably successful money manager when he ran the $450 million Cramer Berkowitz hedge fund, Cramer in the Webcast shared his "tips" on how to drive a stock price down so that a short position -- a bet that a stock price would drop -- remains profitable.

He added that the strategy -- while illegal -- was safe enough because, "the Securities and Exchange Commission never understands this."

A call to Cramer was not returned.

TownCrierExpect Gold to Benefit as Re-inflation Efforts Fail#1535493/20/07; 07:02:44

(Greg Silberman) Mar 20th, 2007 --

. . .The odds favor a Fed induced re-inflation program to begin sooner rather than later in order to protect asset prices. And I'm wondering, just wondering, will the Fed really be able to reinflate?

To re-energize the economy, the Fed will cut interest rates and cause a flood of new money to enter the market. Nothing wrong with that, except that the Fed cannot direct where the new money will flow.

We see from the 2000 – 2002 bear market that the Fed was ineffective in reinflating the collapsing tech bubble and instead, new money found its way into real estate. By the same token, the Fed will fail to bolster real estate this time round.

So where will all the new money go?

My guess is it will find its way into government sponsored programs like infrastructure and defense. Nobody but federal, state and local governments will have the stomach to borrow and spend after the current real estate debacle.

It will also find its way into agricultural commodities where, for example, live cattle prices have recently broken to new highs (even whilst stocks are sagging).

The problem is that higher food prices and higher infrastructure / utility bills are strong warnings of rising price inflation. As inflationary expectations increase, market participants demand higher yields on bonds to compensate for the additional risk (even whilst short-term rates are falling).

And when consumers perceive inflation to be rising they will demand higher wages from employers to compensate for an obvious increase in the cost of living.

Higher wages and higher borrowing costs will have a negative effect on corporate profits, yanking the rug from under the stock market and creating a vicious circle of falling asset prices.

All the while making it necessary for the Fed to inject ever more fresh money to stimulate the economy.

None of this will be lost on gold which is a chief inflation indicator.

...Gold is poised to be the major beneficiary and, at current levels, is significantly undervalued.

^___(from url)___^

Unfortunately, many of the media-influenced masses no longer possess the wit or the intellectual fortitude and willfulness to exersise the independent action necessary to bring physical gold into their lives.

The metal, therefore, will continue to flow to the Third World peasants -- in billions of drips and drops that swell to a flood -- and thereby shall facilitate a massive transition in fortune in an enlighted era as the true power of physical wealth shall ultimately trump the presently prevailing position in the socioeconomic hierarchy now being enjoyed by papers of empty promises.

In which category are you?


slingshotCramer#1535503/20/07; 07:23:05

Has been three months since the interview and just now it resurfaces. How many others doing the same manipulation?
All those watching did nothing? Or has the SEC taken a stance of Don't Rock The Boat.

I own NO STOCK, But I'll tell you what. If I was in the market and heard that statement, the cogs in my head would be turning.


Silver FoxNice jump on POG and POS#1535513/20/07; 07:47:00

Markets appear to be on the move up today. Does this portend another "smack down" Friday?


flow5Down the Tubes#1535523/20/07; 08:14:39

Nothing like being hit from all directions:

flow5Looks like you hit it#1535533/20/07; 08:25:57

Goldilox (3/13/07; 02:14:07MT - msg#: 153323)

Make that "between Mar 20 and MAY 15".

CalidorCramer - Tricks of the Carnival Barker #1535543/20/07; 08:55:39

So ...... as hedge fund manager, Cramer's admission of the ease of manipulating stocks and how he enjoyed the illegal "game" ......

I wonder how difficult it is for "greater" powers with deeper pockets to manipluate the markets, hmmmmmmm ??!

The game ....CAN'T.... be rigged.


Chris PowellChina says it will stop accumulating FX reserves#1535553/20/07; 09:36:50

From Reuters
Tuesday, March 20, 2007

GUATEMALA CITY -- China will stop stockpiling its massive foreign exchange reserves, China's central bank governor Zhou Xiaochuan said in an interview published on Tuesday.

"Many people say that foreign exchange reserves in China are (already) large enough," Zhou told the Emerging Markets magazine, whose latest issue was released at a meeting of the Inter-American Development Bank in Guatemala.

"We do not intend to go further and accumulate reserves," Zhou said, adding the government will "cut a small piece of reserves" for a new agency to be set up by China's central bank and finance ministry to manage its massive foreign reserves, which have swollen because of the trade surplus.

He did not say how much money would be passed to the agency.

China's premier, Wen Jiabao, said last week that plans to form a new agency to invest part of the country's swollen foreign exchange reserves, the world's biggest at more than $1 trillion, would not have an adverse impact on the U.S. dollar.

China's central bank also said last week it would not significantly adjust the composition of those reserves. A large part of them are denominated in dollars.

As the reserves have ballooned on the back of China's record trade surpluses, demands have grown for part of the hoard to be invested more aggressively.

Investors have long fretted over Beijing's plans to diversify its foreign exchange investments because of their potential impact on global markets.

Studies have shown investment by China and other Asian countries in U.S. bonds has reduced long-term American interest rates by as much as 2 percentage points.

TownCrierDollar falls after reports China to sell some reserves#1535563/20/07; 09:42:59

LONDON (AFX) - The dollar fell, particularly against the yen, after reports emerged that China plans to sell a small amount of foreign currency reserves.

Analysts cited a report that emerged this afternoon quoting People's Bank of China governor Zhou Xiaochuan as saying that China will sell a small amount of reserves and not accumulate any more.

"Comments from Chinese Central Bank official Zhou about reserves sent the greenback into offered mode," said Colin Clarkson at Thomson IFR Markets.

A huge amount of China's reserves are in US Treasuries, despite moves towards diversification away from the dollar.

Reaction has been muted, however, with analysts sceptical that the report may be old or that Zhou may have been misquoted.

^___(from url)___^


Paper Avalanche@ CPowell - Re: China FX#1535573/20/07; 09:43:45

The world just lost its biggest sponge to absorb the dollar deluge.

Inflation (hyper?) looms with even greater certainty as a result, IMO.


Thoreauly@ Goldi re: Interesting video#1535583/20/07; 09:49:06

I was trying to post that link along with several others to make the case for "Three Peaks" -- i.e., Peak Oil (see link), Peak Credit (see Peter Schiff on March 10's Financial Sense Newshour), and Peak Swindle (the global warming video).

Still can't post it for some reason, so maybe this will suffice, my overall point being that the first two peaks will likely render the third peak moot, as the world will be too busy coping with its real problems to spend any time on the global warming (read: statist) fraud.

GoldiloxChicken and egg?#1535593/20/07; 10:13:11


The authors make it quite plain that we are in a period of global warming, but that the CO2 research data tends to follow warming patterns, not lead them. The other great anomaly is that we were ina period of cooling from 1940 to 1980, during our largest expansion of western industrial growth.

The longer-term numbers suggest that CO2 concentrations are more likely a product of, not a cause of global warming.

Perhaps not unlike the CONgressional reps who blame China for price inflation, which is a product of, not a cause of real inflation.

At least one scientist I have read lately suggests that the "warming story" is a front for the private takeover of water supplies, something Pulava has been noticing for a few years.

ThoreaulyChicken and egg#1535603/20/07; 10:30:27

Exactly, i.e., there's a correlation, but it's the opposite of what the global warmers are preaching. And I like your Fed/inflation analogy.

But to watcth the Peak Oil presentation is to go drop-jawed at the correlation between it and credit expansion, as it suddently becomes clear that the world's oil supply would not have been depleted nearly so rapidly had it not been for easy, non-asset-based credit.

Result? What would have been a gentle, market-driven rise and fall -- with alternative fuels, modes of transportation, and modes of development introduced as the price of oil rose -- has turned into a steep bell curve that we now sit atop, staring into the abyss on the other side.

Just as we are with Peak Credit.

GoldiloxPlatform#1535613/20/07; 10:34:40

@ Flow5,

We're back to Sinclair's "platform", so now we will see if launch is on schedule, or delayed as often as a NASA launch.

Interesting that the PM equities had the snot knock out of them in the last couple weeks, so they will require some "ketchup!"

GoldiloxMisdirection#1535623/20/07; 10:42:16

@ thoreauly,

It's NOT about credit, oil, climate or gold. The manipulations are about who sits in the seats of power - PERIOD.

Saddam and NK are perfect examples. Rummy and the NeoCONs built them up, and will maintain their power base until the day they rebel from their "program". The opening of the NK gold market (and closing of teh NK nuke fuel market) suggests that NK knows this well.

Gold is a measure of how TPTB are faring. IT takes off when the pereception of their control wavers, and sits quietly the rest of the time, but I would not trust this analysis on a day-to-day basis, since they also manipulate IT.

ThoreaulyMisdirection#1535633/20/07; 10:51:13

To me, insofar as it's all about the money (and isn't it?), it's about what all the non-asset-based credit has wrought. And since this fraudulent credit has reached the point where the global house of cards could come tumbling down at virtually any moment, it's all about when, not if, we begin our slide into the abyss.
GoldiloxThe Abyss?#1535643/20/07; 11:01:27

@ thoreauly,

Ah, but even the Abyss must be timed properly -

1) US forces busy in ME and 130 other countries, so foreign troops stationed in AZ and WA are "invited" to act as "UN Peacekeepers" in their stead. After years of send UN PKs into other nations, I wonder how the US electorate will enjoy that irony?

2) Mexican troops poised at the border to kindly help with any emergency
(We don need no stinkin' "posse comitatus")

All we need is for someone to yell "fire" in the theater (TeeVee).

Or as scripted in "The Russians are Coming, the Russians are Coming",

"Amergency, Amergency! Everyone to get into street!"

ThoreaulyAmergency#1535653/20/07; 11:25:27

Yes, Goldi, if it can in fact be timed correctly -- i.e., the expanding war in the ME triggers an Amergency that provides the legal cover for Bush to bring the North American Union and the amero into being, effectively naturalizing the Mexican workforce and replacing the dollar with the crisp new (but equally worthless) amero.
TownCrierThoreauly ... "it's about what all the non-asset-based credit has wrought"#1535673/20/07; 11:29:06

I'm trying to wrap my mind around your comment about "non-asset-based credit".

You also indicate that it is "fraudulent credit", seeming to imply that "asset-based credit" is to be much preferred.

Is that it?

If that's in sync with your meaning, then I next find myself trying to wrap my mind around the meaning of "asset-based credit". Would that be something like a gold loan?

Asset-based or not, credit by any of its names (loan, credit, promise) all boils down to a potentially defaultable contract among counterparties.

"Ugh!" Look at the havoc that has been historically wreaked during our past periods in which asset-based gold loans were heavily utilized. The strength of the credit still boiled down to mere contract performance, and yet, at the same time, the biggest measurable difference was to be found in the depression it brought upon the value of gold in the marketplace -- because vast supplies of papergold were thereby brought forward at the margin.

As more and more goldbugs gain an understanding of this, they begin to change their old views of the merits of fiat currency within an economy and within a person's financial affairs.

Credit-based money and fiat currency are fated by form and function to exist in sync with the elasticity of supply associated with our modern financial/banking institutions. And while blessedly convenient, it is fully acknowledged that the ratcheting supply does wreak havoc upon the value of the currency (monetary unit) over time. This is why something tangible -- such as gold -- is best left free and clear of these types of credit associations.

To put this all very simply into a nutshell:

---Credit-based money (and its representative fiat currency) is the perfect form to populate your CHECKING account.
---Physical gold is the perfect form to populate your SAVINGS account.

In each case, the attributes of the given form are perfectly matched to function they are asked to provide.

Amen. Amen. Amen.


Paper AvalancheNew Record#1535683/20/07; 11:36:59

Gold closed above $650 for the 28th day this year, beating the old record from 1980 of 27 days of closes above $650 in a calendar year.

Going forward it may be easier keeping track of the days that gold closes below $650 in a given year.

The king of useless trivia and gold statistics,

GoldiloxGold Savings#1535693/20/07; 12:42:47

@ TC,

If I may expound on your post, gold in-hand savings has shown itself to be much more secure than the paper chase, even in "well-managed times" for all but the speculators who try to time their jump onto the "moving train".

How much more "secure" may that be in the more tumultous times that may be ahead?

Bottom line, while gold is the perfect "savings" vehicle during upheaval, the growth curve (or depreciation curve if one is looking at the alternative FIAT currencies) over the long-term, has made it preferrable to the "interest bearing" instruments for both safety and profitability.

mikalHoping to weather "the slowdown"#1535703/20/07; 12:42:51

Can world weather slow down in US? | By Michael R. Sesit - Bloomberg 5:00AM Tuesday March 20, 2007

Excerpt: "As the US$13.3 trillion ($19 trillion) US economy slows, will the rest of the world pick up the slack?

It's a question that has bedevilled economists. The debate over whether global growth can weather a steep US slowdown has all the earmarks of a number-crunching exercise, and it is already having an effect on stock prices in Asia and Europe."

GoldiloxMore layoffs in sub-prime market#1535713/20/07; 12:55:53,1,7104393.story?track=rss&ctrack=1&cset=true


The shakeout in the sub-prime lending industry continued Monday, with more people losing their jobs and a prominent lender losing its name on a baseball stadium.

Fremont General Corp. of Santa Monica said it had told "significant numbers" of its 2,400 home-loan employees to expect pink slips in two months. Company officials declined to say how many employees would be dismissed.

Fremont is the latest lender to announce layoffs in the sub-prime market, which targets people with dented credit. Rising defaults and foreclosures have ravaged the industry, and some economists fear the sector's woes could extend to the housing market and the broader economy.

The Orange-based parent of Ameriquest Mortgage Co. and Argent Mortgage Co. announced large but unspecified layoffs last week. On Monday, Ameriquest said that its name was coming off the Texas Rangers' baseball stadium in Arlington, Texas.


Trouble in bubble-land. I guess it's back to the grease pits for all the "new" mortgage writers. "Would you like fries with that?"

Dem bones, dem bones . . .

Thoreauly@ TC re: non-asset-based credit#1535723/20/07; 12:59:44

I'm taking my cue from Sir Alan, back when he was a lowly but principled commoner:

"Under a gold standard, the amount of credit that an economy can support is determined by the economy's tangible assets, since every credit instrument is ultimately a claim on some tangible asset. But government bonds are not backed by tangible wealth, only by the government's promise to pay out of future tax revenues, and cannot easily be absorbed by the financial markets. A large volume of new government bonds can be sold to the public only at progressively higher interest rates. Thus, government deficit spending under a gold standard is severely limited. The abandonment of the gold standard made it possible for the welfare statists to use the banking system as a means to an unlimited expansion of credit. They have created paper reserves in the form of government bonds which -- through a complex series of steps -- the banks accept in place of tangible assets and treat as if they were an actual deposit, i.e., as the equivalent of what was formerly a deposit of gold. The holder of a government bond or of a bank deposit created by paper reserves believes that he has a valid claim on a real asset. But the fact is that there are now more claims outstanding than real assets. The law of supply and demand is not to be conned. As the supply of money (of claims) increases relative to the supply of tangible assets in the economy, prices must eventually rise. Thus the earnings saved by the productive members of the society lose value in terms of goods. When the economy's books are finally balanced, one finds that this loss in value represents the goods purchased by the government for welfare or other purposes with the money proceeds of the government bonds financed by bank credit expansion."

Thus, "money proceeds" -- irredeemable paper -- are but an extension of this ex nihilo and accordingly fraudulent credt, which has expanded to the breaking point.

Conversely, asset-based credit, stemming from sound (i.e., commodity-based) money could never expand in this manner, limiting the state accordingly and precluding anthing like we're seeing today.

TopazBond : Gold.#1535733/20/07; 13:22:32

Today we see the 20-20 hindsighters out in force with their "reasonings' for PoG action ...borrrr-ing!
Today, in fact was the first day where PoG moved to distance itself from Bond to seek an alignment with Buck can be perfectly explained as we approach the April Delivery Period.
If we reconfigure the comparison Chart to GC and alt-DX, we can see there is quite a lot of ground to make up on the alts as we go into April.
Ag? absolutely disappointing AGAIN! (still) ...Love is blind though.

TownCrierThoreauly ...#1535743/20/07; 13:37:34

Unfortunately, your comment...

"asset-based credit, stemming from sound (i.e., commodity-based) money could never expand in this manner, limiting the state accordingly and precluding anthing like we're seeing today" a very popular notion among goldbug, yet it is nonetheless an outright fallacy. It will expand, and expand, and expand... in fits and starts... until eventually being abandoned as an ineffectual hoax. History does bear this out.

I'll throw this open to a larger audience.

Knowing as we do that the currency of the realm is destined to inflate, if given an opportunity to order my affairs accordingly I would therefore choose to have my SAVINGS well-insulated (separated) from the monetary mayhem that my CHECKING account must endure.

By the time we're all seventy, I would hope that our (gold) SAVINGS have become the much larger (and more important) of our two pools of liquidity.

Why, then, would you want to put our most important avenue of well-being into jeopardy by arguing implicitly for a gold-standard?

Can anyone clearly explain to me why they beleive that physical gold savings isn't enough? Why do they always want to cast a shroud over the elegant value of gold ownership by seeking to get it entrenched and encumbered into the elaborate shell game that is our modern banking system?

Bottom line: The only thing truly wrong with fiat currency is that some people have been misguided enough to think that currency ought to function as a long-term store of value, and that among these people, some are actually foolish enough to try to use it as their savings because they believe that money/currency is a reasonable store of wealth.

It isn't. For that, you need to choose tangible property. And among tangibles, gold reigns supreme because it is chosen for its durability, divisibility, and especially its liquidity.


Chris PowellThe more gold Dutch central bank sold, the higher the price went#1535753/20/07; 15:33:41

Sell it all, you blankety-blanks!

* * *

From Dow Jones Newswires
Tuesday, March 20, 2007

AMSTERDAM -- The Dutch central bank, DNB, sold 54 metric tons of gold in 2006, it said in a press release Tuesday.

Its gold supplies therefore stood at 640 tons at the end of December 2006.

The Netherlands' gold reserves are now worth around EUR10 billion, according to the DNB. Because of the steep rise of the price of gold over the past two years the value of the DNB's gold reserves has increased while the volume has decreased, DNB said.

The Dutch central bank has been selling gold since the early 1990s. DNB can sell up to 165 tons of gold between 2005 and 2009.

In 2005 and 2006 combined, the DNB sold 136.5 tons of gold.

ThoreaulyTC#1535763/20/07; 15:37:40

Let me get this straight: I quote from a classic article posted on this site, and you're saying that credit shouldn't be issued in a sound-money economy because it "will expand, and expand, and fits and starts...until eventually being abandoned as an ineffectual hoax"?

"History does bear this out"?

I'm at a complete and utter loss.

Chris PowellYa think? Newcrest contemplates ending gold, copper hedges#1535773/20/07; 15:46:49

5:36p ET Tuesday, March 20, 2007

Dear Friend of GATA and Gold:

MineWeb reports that Australia's Newcrest Mining Ltd. says it's not likely to do any more hedging of its gold and copper production. The company's CEO, visiting financial analysts in North America, is quoted as remarking that Newcrest's hedging has been "constraining" the company's earnings.

The financial analysts in his audience may be able to respond only as the guys in the Guinness commercials: "Brilliant! Brilliant!"

Of course maybe a little too much Guinness explains all the hedging Newcrest is stuck with.

You can find the MineWeb story here:

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

TownCrierThoreauly -- history does bear this out, and is aided greatly by the recent past#1535783/20/07; 16:37:59

It's easy to reconcile the difference when you consider that Alan, in crafting his "classic", wasn't able to draw upon the additional 40 years worth of additional worldly insight and experience that we now draw upon today.

Consider this. Drawing upon the hard experience of the 1980's and 1990's, many dyed-in-the-wool goldbugs will now readily castigate mining companies for engaging so heavily in gold hedging programs -- basically amounting to a system in which gold forwards and gold loans (essentially "gold as money" behavior) came to dominate the landscape of the gold market.

Because the given quantity of available metal was being effectively diluted by vast quantities of paper gold that traded as equivalents in the marketplace, the result was a suppression of the market value of "gold". And I say "gold" in quotes because in this period it no longer existed purely as a metallic substance, but had instead been largely dematerialized into an accounting concept where most ounces of gold existed on the books in name only.

As a result of these recent decades, many of those newly informed goldbugs now realize that a monetary gold standard is NOT a preferrable goal. Why? Because such an arrangement would mean that every loan would be a gold loan -- effectively swelling the undesirable ranks of the gold hedging miners to include every corporation and every government and every borrowing Sam on the face of the planet.

Bullion banking on that scale is what makes it feasible to engrave and maintain a functional illusion of a ridiculously low market value such as $20 upon a gold coin that would otherwise trade at significantly higher prices if valued on it's metal content.

The lowly copper penny is beginning to teach this very same lesson in our modern day.


USAGOLD Daily Market ReportPage Update!#1535793/20/07; 17:40:38">
The Daily Gold Market Report has been updated.

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

TUESDAY Market Excerpts

March 20 (Reuters) -- Physical demand and buying by funds drove U.S. gold futures to end higher for a fourth straight day on Tuesday, as a weaker dollar also helped lift the precious metal contracts to a two-week high.

The COMEX April gold contract settled up $4.70 at $659.00, and traded between $653.30 and $662.00, the loftiest level since March 2.

David Meger, metal analyst at Alaron Trading, said that a resurgence of gold demand, particularly from Asia, drew buying interest back into the gold market. "We have another round of fund- or speculative-type activity. More importantly than anything else, we had that physical demand element come back to the market," Meger said.

The April contract was up nearly 9 percent from its five-month low in early January, but it was still down from its 2007 peak of $692.50 on Feb. 27 after investors were rattled and stock markets saw some volatile price swings in the past few weeks.

Carlos Perez-Santalla at Hudson River Futures also said that Tuesday's rally was largely due to fund buying.

Gold was also boosted by the notion of a weaker dollar after China's central bank governor Zhou Xiaochuan said in an interview published on Tuesday that China would stop stockpiling its massive foreign exchange reserves. The bulk of China's currency reserves is held in U.S. dollars.

The dollar fell sharply against the yen after the news, but the greenback also slipped about 0.1 percent against the euro. Investors are looking for signals from comments about the U.S. economy out of the Federal Reserve's rate-setting meeting, which begins on Tuesday and is due to conclude on Wednesday.

In other news, U.S. brokerage Merrill Lynch raised its long-term forecasts for gold prices, citing positive supply-demand fundamentals, while keeping its view unchanged that bullion could hit $700 an ounce by mid-May because of buying for the Indian wedding season.

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

mikalShort circuit?#1535803/20/07; 17:47:13

Can Dollar crash now? What is the effect on world stock markets and economies?
Jaren Zuba | India Daily | March 18, 2007 - Excerpt:
A drop below 78 in dollar index can create a massive wave of selling pressure. If Euro can cross $1.50 mark to one euro, the European currency will reach $2.00 very fast. That will crash the dollar. The dollar index will fall to 65 level – unprecedented.

That will create a massive financial meltdown in the world economies. The exporters to US will go bankrupt. Japan and China will be worst hit. Indian outsourcing industry will end its existence. The Asian exporters will face massive depression.

The scenario for dollar is bad for the short to intermediate term and very bullish on the long term. As the US economy realizes the stealth deflation in the economy, it will create massive gyration within the financial system. Once the Federal Reserve signals a rate cut, dollar collapse in a very violent way. The last thing the currency markets are expecting is a real deflationary recession or depression in the economy. The negative savings rate will finally come to an end. The effect on the stock markets worldwide will be severely negative."

ThoreaulyTC#1535813/20/07; 19:55:02

"It's easy to reconcile the difference when you consider that Alan, in crafting his 'classic', wasn't able to draw upon the additional 40 years worth of additional worldly insight and experience that we now draw upon today."

So the quotation marks around the word classic means that you don't actually consider it a classic? Then why post the article on your site?

Furthermore, of the "40 years of additional worldly insight and experience we now draw upon today," 36, and counting, have been experienced amid a world of pure fiat, which I'll let 1999 Nobel Laureate Robert Mundell (ultimately a monetary wimp, but that doesn't make his words any less true) put in perspective:

"The main thing we miss today is universal money, a standard of value, the link between the past and the future and the cement linking remote parts of the human race to one another. ... The absence of gold as an intrinsic part of our monetary system today makes our century, the one that has just passed, unique in several thousand years."

As for the shenanigans of the mining companies, isn't it clear that this is all part of the fiat game? After all, who would be stupid enough to play such a game under a true gold standard, where purchasing power would only increase as time went on (see link)?

Lastly, OF COURSE "every loan would be a gold loan," as every good would derive its exchange value from the most precious good: gold.

Please, TC, please explain what I'm missing here, else I be asked to believe that gold needs a government- and fiat-based monetary system in order to function!

Gandalf the WhiteBEAUTIFUL WATERFALL today ! <;-)#1535823/20/07; 19:59:32

flow5Dollar Collapse#1535833/20/07; 20:28:20

A flight from the dollar will cause not depression, but hyperinflation in terms of dollar denominated assets.
GoldiloxAsian Gold creeping back up to #1535843/20/07; 20:51:33

@ Flow5,

Are we a day late, or experiencing some pre-FED jitters?

All eyes seem to expect the FED to stand pat tomorrow, in order to keep from dashing the ailing housing market on the rocks.

A rate-hike to hold back price inflation might very likely send both the lending and stock markets into a tailspin, and a cut would surely fuel the fires of inflation to a roaring blaze.

Can you say "between a rock and a hard place", boyz and gurlz?

Goldilox"the platform"#1535853/20/07; 20:53:52

. . . is what I was trying to add to the previous title before my arthritic fingers chose their own keystrokes.
GoldiloxNew Debt limit?#1535863/20/07; 21:49:13

Surfing over the the Brillig National Debt clock, I noticed we're within $163B of the debt limit set by CONgress a year ago last week.

That should be easily exceeded by the June 30 Fiscal year end.

Hyperinflation? Naw, they've only raised the ceiling three times for the Drunken Sailor CONgress and Admin in the last 7 years.

$5.7T in 2000, $8.9T in 2007.

More than one-third of the entire total has been added during Dubya's watch, with 7 fiscal quarters still remaining. Can they reach 50% ? If you count off-budget expenditures, they already have! Some legacy.

With over 1000 members of the "Billionaire's Club", how long until Hyperinflafla and DC spend-o-mania delivers our first "Trillionaire" ?

QuickbeamVery interesting - from Stephen Roach at Morgan Stanley#1535873/21/07; 07:17:46

Babylon speaking the truth? I guess da cat is outta da bag.
GoldiloxSinclair's Commentary#1535883/21/07; 08:29:30


Below are some examples of the very real effects commodity prices are having on businesses. These product updates are current as of March 19th, 2007. Courtesy of CIGA Marc.

Romex Electrical Wire
Raw copper has continued to increase to over $3.00 per pound. Prices will once again increase by 5-10%. Expect the increase to be implemented on March 20, 2007.

Copper Tubing & Pipe
Open market raw copper has increased enough in price that tubing prices should increase by 5% over the next two weeks. This applies to soft and hard copper.

Plumbing Pipe
Crude oil prices have shown small declines recently, however producers are experiencing higher resin and other material costs. Pricing is up approximately 12-15% on some items while pressure pipe and DWV pipe may only be up 7-10%. At this time fuel surcharges still apply to orders.

Inflation is eating US wage gains

Food, housing, and healthcare costs rose at a 6 percent yearly rate in the past three months.
By Mark Trumbull | Staff writer of The Christian Science Monitor

Brian Fortinberry, who runs Front Range Barbecue in Colorado Springs, Colo., is feeling the brunt of a spike in prices.

Beef costs about 10 percent more than it did in January, he says. Fruit and lettuce are also pricier. Gasoline has gone up, adding to costs when his restaurant does a catering job. And Colorado voters just raised the minimum wage – pushing up his payroll tab.

"We haven't increased our prices, but we're looking to do that," Mr. Fortinberry says. "Eventually you have to pass it along."

The economy may be a bit cooler than it was a year ago, but inflation is still running hot. It's not like the runaway price train of the '70s, but it's enough so that people notice at the grocery checkout, when they pay for day care, or when they buy college textbooks.

Some prices – namely for housing, food, and medical care – have been more noticeable than others of late, jumping at a 6 percent annual rate during the three-month period from December through February, the government reported Friday. Retail gasoline prices rose 7 percent in just two weeks, according to a March 12 report by the US Energy Information Administration.


Up, up, and away . . .

GoldiloxNational Gas "temperature" map#1535893/21/07; 08:33:56

Heating up again. Here in the "blue" state of California, gas prices are solid "red" - up about $0.80 since the election.
mikal(No Subject)#1535903/21/07; 09:35:28 Are We Experiencing the Last Days of Constitutional Rule? by Paul Craig Roberts | March 21, 2007
Roberts does not address many economic and financial violations such as off-budget expenditures, fraud, antitrust violations that have deep roots extending across centuries and continents.
But this short, apt, nonpartisan summary of violations and infringements implies gross neglect, fiscal mismanagemnet and breach of duty that affect everyone, everywhere.

flow5Last days of constitutional rule#1535913/21/07; 10:07:04

His remarks are understatements. Why sugar coat it? We are headed for a command economy and a totalitarian mold. This is about our preditory society, greed and evil. It is about our "elastic" legislators, lobbyist, and their constituents.
mikalBetween a rock and a bullet train#1535923/21/07; 12:35:24

Fed keeps rates steady, sees inflation elevated
While acknowledging slowdown, FOMC maintains bias toward raising rates | Rex Nutting & Greg Robb, MarketWatch
Last Update: 2:28 PM ET Mar 21, 2007 -- Snippit:
WASHINGTON (MarketWatch) - The Federal Reserve held its benchmark interest rate steady Wednesday, saying its "predominant policy concern remains the risk that inflation will fail to moderate as expected."
In its statement, the Federal Open Market Committee acknowledged recent data showing both higher inflation and a weaker economy. See the full text of the statement.
In its statement released at the conclusion of their two-day meeting, the FOMC no longer said the economy was "somewhat firmer" as they did in comments issued at the conclusion of their January meeting. Instead, the Fed said recent indicators had been "mixed."
"Nevertheless, the economy seems likely to continue to expand at a moderate pace over coming quarters," the FOMC said.
And instead of saying it saw "some tentative signs of stabilization" in the housing markets, the committee said "the adjustment in the housing sector is ongoing."
The FOMC repeated that rising inflation remains the greatest risk to a stable economy. "Recent readings on core inflation have been somewhat elevated," the statement said. "The high level of resource utilization has the potential to sustain those pressures."
In one small hint that the FOMC may be moving closer to cutting rates, the committee dropped a phrase from previous statements about the "additional firming that may be needed." But the committee also heightened its concern about inflation, suggesting that it is still leaning toward higher rates if inflation does not moderate.
The Fed has held its key short-term rate at 5.25% since last June.
Since its last meeting in late January, more signs of a slowing economy have emerged, including further troubles in the mortgage market and a sharp downward revision to fourth-quarter growth. But inflation worries have also mounted, putting the Fed in a delicate position. Read our complete Fed coverage.
With forces pushing them in opposite ways -- to raise rates to quell inflation and to lower rates to revive growth -- the Fed opted to do nothing while events play out. The Fed's baseline forecast is for both inflation and growth to stabilize.
Financial markets have priced in one or two rate cuts this year, but a sizable number of economists and strategists say the Fed is more likely to raise rates to stop inflation from getting too high.
The Fed's official policy stance leans toward raising rates, but that could change in an instant if growth slowed too quickly or signs of systemic market turmoil emerged.
The vote to keep rates steady was unanimous.
The Fed targets overnight lending rates to loosely control inflation via their impact on economic activity. Higher rates cool the economy, reducing inflationary pressures over time as demand slows. Lower rates can boost demand."

Sierra MadreFlow5: "Last days of constitutional rule"....#1535933/21/07; 12:42:17

The last days of constitutional rule happened many, many years ago!

Like Cicero fifty years before Christ, Paul Craig Roberts is crying for help in preserving the Constitution. But there is NO REPAIR to what has taken place through many decades. Nothing can ever be "restored". What's past is past.

The "Republic" cannot be restored or even saved, for it is dead and gone, and has been gone for many a year.

The USA is now a vassal state, under the complete control of a foreign nation. So it cannot be called an "Empire", for it is not sovereign. The US Government is a sort of "management" installed by the majority stockholder and responsible to it. Management takes its cue from stockholders, who can hire and fire it, certainly not from the employees. AIPAC is the proxy for the stockholders.

GOLD will prove useful in what is yet to come.


mikalAtmospheric pressure#1535943/21/07; 12:57:05

Why the Economy Cannot Withstand More Mortgage Foreclosure
Posted on Mar 21st, 2007
"Michael Panzner submits: According to the Wall Street Journal, the "Economy Can Withstand More Mortgage Foreclosures." However, when you read the article, you realize that the optimistic outlook depends on two very big -- and very unlikely -- assumptions.
About 1.1 million foreclosures are likely to result from jumps in monthly payments on adjustable-rate home-mortgage loans made in 2004 through 2006, according to a study by First American CoreLogic.

Christopher Cagan, director of research at the real-estate-information concern based in Santa Ana, Calif., said those foreclosures are likely to occur over six to seven years and won't be enough to damage the national economy. (Financial markets could be hurt, however. See Abreast of the Market1.)

Dr. Cagan analyzed 8.4 million adjustable-rate loans made during those three years and estimated that 13% of them, totaling $326 billion, will end in foreclosures. After lenders resell those properties, the total losses for lenders or investors holding the loans will be $113 billion, he estimated. That is about 1% of total U.S. home-mortgage loans outstanding.
"The vast majority of borrowers will be fine," Dr. Cagan said.

The estimates are based on an assumption that average home prices will remain about level with the December 2006 level over the next five years. If prices drop 10%, the number of foreclosures would jump to 1.9 million, Dr. Cagan projected. But a 10% rise in prices would cut foreclosures to 489,000, he estimated. When prices rise, people struggling with loan payments are more likely to be able to refinance into a loan with easier terms or sell their homes for more than the loan balance.

Given the extraordinary gains in home prices in recent years, the fact that inventories, vacancies, and delinquencies are at or near record levels, purchase-contract cancellation rates are still outpacing sales at many new home builders, housing completions have only just begun to level off, and a large segment of prospective home buyers -- those categorized as subprime -- will find it difficult, if not impossible to obtain mortgage financing under new, more restrictive guidelines and difficult market conditions, then the view that "average home prices will remain about level...over the next five years" seems totally unrealistic. But that's not all."

Chris PowellYes, the IMF IS changing its rules to end double-counting of leased gold#1535953/21/07; 13:09:00

3p ET Wednesday, March 21, 2007

Dear Friend of GATA and Gold:

Resource Investor's Jon A. Nones today confirmed that the International Monetary Fund is heeding GATA's longstanding complaint and the immense work of Blanchard & Co.'s vice president for research, Neal Ryan, and is rewriting its rules to prevent the double counting of gold leased by central banks.

You can find Resource Investor's report, "IMF Posts First Draft of Changes to Gold Loan Accounting," here:

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

mikalSailing, SAILING ahoy!#1535963/21/07; 13:11:42

Ahoy me maties, from the far seas, from sea to shining
sea, anchored fast where the west wind blows- we waits
while the good ship Dow cow merrily, verily, heads for the
breakers and shoals. Aye, I can't bear ta look, can ye?

TownCrierFed's FOMC stands 'as is'#1535973/21/07; 13:15:25

March 21, 2007 Press Release

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

Recent indicators have been mixed and the adjustment in the housing sector is ongoing. Nevertheless, the economy seems likely to continue to expand at a moderate pace over coming quarters.

Recent readings on core inflation have been somewhat elevated. Although inflation pressures seem likely to moderate over time, the high level of resource utilization has the potential to sustain those pressures.

In these circumstances, the Committee's predominant policy concern remains the risk that inflation will fail to moderate as expected. Future policy adjustments will depend on the evolution of the outlook for both inflation and economic growth, as implied by incoming information.

Voting for the FOMC monetary policy action were: Ben S. Bernanke, Chairman; Timothy F. Geithner, Vice Chairman; Thomas M. Hoenig; Donald L. Kohn; Randall S. Kroszner; Cathy E. Minehan; Frederic S. Mishkin; Michael H. Moskow; William Poole; and Kevin M. Warsh.

^___(from url)___^

This commentary is even less useful than usual. Maybe that tells us something. As a general rule, the worse things are (i.e., the closer to a crisis scenario we are), the less candid (and more opaque) these officials typically become.


mikal@Chris Powell#1535983/21/07; 13:18:07

Congratulations. They bit off more than they can chew
but the IMF was never known to practice good eating habits.

Silver FoxDollars moving.... down.#1535993/21/07; 13:23:04

It doesn't appear the some people who are holding dollars liked the "Fed's" announcement.


GoldiloxFED Open Mouth Committee#1536003/21/07; 13:31:42

@ TC,

"This commentary is even less useful than usual"

-Consider the source!

GoldiloxCNBC bug#1536013/21/07; 13:41:35

is reporting Gold at 660. Is the April contract below the spot price of 663?
Paper Avalanche@ Goldilox#1536023/21/07; 14:22:31

After 1:30 EST CNBC reports the closing price for the day which was $660. They do not report any after-hours market activity that we see in INO.


Sierra MadreBureaucrats faced with a dilemma -#1536033/21/07; 14:28:52

When bureaucrats - such as make up the Fed - are faced with a dilemma, that is, with the need to choose between two disagreaable alternatives, the standard procedure is - TO DO NOTHING!

That's what they did today: nothing. Trouble is, doing nothing is still, doing something.

The markets have understood and the result is evident: the dollar falls and gold rises, rather aggressively compared to recent days' action.

So, now what? Who knows, but it will be interesting to watch. Long run, GOLD can only go UP, in my opinion.


Sierra MadreMemories I relish...#1536043/21/07; 14:33:47

Ah, yes! How I relish the memory of Swiss Bankers telling me in 1999, that - gold was done for; that no one wanted gold anymore; that they had closed their gold fund; that the CB's really wanted to get rid of their useless gold.

"Is that so?" I replied. "Buy me some more."

"What an ODD customer!" they must have thought.

My stature has since improved, in their evaluation.

How sweet it is!


SundeckDollar, gold and housing#1536053/21/07; 14:57:36

Mmmm....stocks up sharply...does this mean we are likely to see an easing on the downward pressure on housing prices as well?

If so, that may result in some increased sales, and also stave off some foreclosures that arise from falling equity that people hold in their houses (becoming more negative in many cases), but it will not necessarily help those people who can't meet the loan repayments (and probably never could!!)...they need increased income. They need a break-out in wages such as we saw in the '70s and '80s (in Australia, anyway, that is what happened). Their wage-increases need to get ahead of interest rates and stay there for a while.

Well, stocks went up, gold is responding upswards as it should, houses may also respond upwardly (but the response is not so instantly visible as they are less liquid)...and the dollar certainly got it right! That must surely qualify for one of the fastest "corrections" on record.


mikal@Sundeck- Summers brings back Charles Dickens? #1536063/21/07; 15:59:00

Re: "That must surely qualify as one of the fastest "corrections" on record." Not so fast! ~8O

Ex-Treasury chief Summers warns on market risks
Tue Mar 20, 2007 12:28pm ET
ATHENS, March 20 (Reuters) - Financial markets are not adequately pricing geopolitical risk and are more likely to surprise on the downside than the upside, former U.S. Treasury Secretary Lawrence Summers said on Tuesday.
In a speech to business people on the main challenges and risks facing the global economy, Summers identified geopolitics as one area of concern.

He said he saw serious, incipient nuclear proliferation threats, a growing resentment between the United States and Europe, and less leadership in the global system with nations jockeying for position.
Summers also said he saw an increasingly hostile and authoritarian Russia and a China more active in the Middle East and Latin America.

"To the first approximation, none of this is priced into markets," he said. "There is a near complete disconnect between geopolitical risk and risk that is priced and perceived in financial markets."
"It's like something out of Dickens, you talk to international relations experts and it's the worst of all times. Then you talk to potential investors and it's one of the best of all times."

Looking at how financial markets were priced, the former treasury secretary said "there is probably more room for surprise on the downside than the upside."
"Risks are not small from where we are. Policy challenges are large," said Summers, who was Treasury secretary from 1999 to 2001 under then-President Bill Clinton."

USAGOLD Daily Market ReportPage Update!#1536073/21/07; 16:17:44">
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

March 21 (Reuters) -- U.S. gold futures finished $1 higher on Wednesday on higher crude oil prices, though investors largely held their bets ahead of an interest rate decision by the Federal Reserve.

The COMEX April contract settled up $1.00 at $660.00, traded between $657.50 and $662.90. Gold futures closed higher for a fifth straight day.

After the pit session ended, the Fed held benchmark interest rates steady at 5.25 percent and said inflation remained a concern. It said the economy is likely to expand slowly in the months ahead and left its future policy options open. In a statement outlining its interest rate decision, the Fed dropped a reference that had been contained in its last policy announcement to the possibility of further "firming" of monetary policy, saying simply: "Further policy adjustments will depend on the evolution of the outlook."

The dollar fell sharply against the euro after the Fed's statement.

Gold futures rose further in electronic trade.

Gold usually moves in the opposite direction of the dollar. By 2:53 p.m. EDT, the April contract rose to $663.50 in electronic trade on CME's Globex system.

Emanuel Balarie, senior market strategist at Wisdom Financial, said that gold had been trading in a range between $635 to $660 an ounce on a spot basis. "I'm still keeping an eye on gold and how it's been tracking the equities market. I think sooner than later we'll see a decoupling from that and (gold) to trade on its own merit," Balarie said.

In other news, investment bank UBS said in a daily note that bullion prices could have a rocky ride in the near term. "We still believe that gold may have another dip lower on further long liquidation if broader asset market weakness continues, but we continue to forecast higher one-month and three-month gold prices at $700 (spot) and $750 an ounce respectively," UBS said.

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

mikal'Liquidity' meets it's match?#1536083/21/07; 16:44:32

Unique, short look at the housing and mortgage finance debacle written with humor and wit:
What goes boom must go bust
Commentary: U.S. housing collapse comes as liquidity dries up By Scott Reamer
Last Update: 9:08 AM ET Mar 21, 2007
"Scott Reamer works at Vicis Capital, a multi-strategy hedge fund in NYC. He also writes for
NEW YORK (MarketWatch) -- Mortgage marketing campaigns have been changed from "Money? Free!" to "Last four years of W2's - notarized!", font sizes have been reduced in print ads, get-rich-on-real-estate infomercials have been moved from prime time to 2am, your brother in law has finally clammed up. Indications, all, that something has changed - really changed - in the housing market."

"But things are different now, measurably so. And that difference is not just that the demand for credit to speculate on housing has declined. It's that supply is now contracting. And when a credit cycle starts seeing supply contract (liquidity declining), all sorts of things start to happen: speculation gets robbed to pay a tax to prudence."

"Booms turn to busts not because something 'happened.' They turn to bust because there is simply no other path.
It is said that when men go mad they do so all at once. But they gain their sanity slowly and one by one.
That credit supply is being tightened means we've passed the 'one-by-one' stage and we're approaching 'all-at-once.'"

melda laureBeans Bees etc.#1536093/21/07; 17:36:42

It was only a matter of time before the commodities folks started putting two and two together... Fortunately it doesn't affect mine output. But it may keep a bit of pressure on interest rates.
melda laureIt ought to be obvious... but only to the experts.#1536103/21/07; 18:12:17

Finding an example where depreciating national money led to lower interest rates is difficult. No, it is impossible to do.

Well it's dollar reserve status.... DUH!

When someone owes the "bank" two trillion dollars, the "bank" set the rate. Do a test. Call your credit card company or your mortgage lender. Tell them you have decided to lower the interest rate on your loans.

the days of the Chinese Banker may yet come. With it, the rules may well change.... Somehow, I dont think Mr Schmidt is quite correct. To comment on Sierra Madre in mssg #153593, I just dont see China as one of the principle shareholders. Nor do I think the british crown is one of the proxies of the shareholders. On the other hand, what sort of relationship does exist is a bit of a puzzle. (TPTB like it that way).

I would take Paul Skarps comments on solar flares with a big grain of salt. Blaming flares is like blaming the US economy on "high inflation"- the obvious retort being that our low interest rates suggest a tame CPI. Both these measures are very misleading as an indicator of real inflation.

Likewise, solar activity is not a proper measure of solar energies as much of the hyperdimensional activity is countercyclical in the same way that a pendulum alternates between manifesting energy as kinetic (at the bottom of the swing) to potential (gravity- at the top of it's swing where the pendulum momentarily stops moving). But of course hyperdimensional physics is phantasy, just like M3.

Explaining complicated effects with a half-wrong theory is likely to mislead.... but as aureophiles we already know that. The rest of the poor schmucks will be cheering the real-estate market all the way to schlemeel status.

melda laure"For the fashion of the world was changed"#1536113/21/07; 18:44:09

It's dangerous to bee too far ahead of the curve. It's very informative, but not a profitable way to trade. Ethanol was a great trade, and probably a lousy investment. Gold has been a lousy trade (for those who bought at 750) but will be a great investment regardless where you bought. O(3) electrodynamics is at this point just "entertainment". It is not a good investment or a good trade. Oil stocks have been a good investment, but their future depends on many unknowns. In particular, consider how real estate will be priced in the future, that is, what will be a future "good" LOCATION?

(Fault-riven subduction zones located amidst arid lowlying coastal areas?)

Gold's present price is based on flawed economics: hedging, flawed CPI, hidden M3, reserve games. These same things hide the value of water rights, farmland, and other things while inflating bonds, paper, pensions and the value of a large over-seas-based standing army. It is easy to demonstrate this: just look at the cash flows. You pay to be too far ahead of the curve.

At least gold is no longer too far ahead. It's been appreciating like 20% (in flawed dollars) per year for some time now. Not every insurance instrument can say the same.

melda laureBag of air, bag of gold. Pillar of heaven, pillar of salt.#1536123/21/07; 19:03:57

Consider real estate and gold. Which is inflating because of massive leverage, and which is rising in spite of massive leverage pulling back on the reins?

We have seen that going back all through history that there have been the same elite few that have desired to dominate and rule the world.

Yes, but it's all a waste of time. Rothchilds sought control of money. Canute tried to control the tides. Did the lords of the west cause the deluge? Or were they powerless to prevent it? To this the remnant of numenore know not the answer, Eru alone knows. I leave you to guess

Bernanke thinks he controls the dollar. Let him, there is no future in it.

Chris PowellIndia may be indifferent to gold ETFs without delivery of metal#1536133/21/07; 20:35:59

Gold ETFs May Not Be A Big Hit

By Ashutosh Joshi
Business Standard, Mumbai
Thursday, March 22, 2007

MUMBAI -- The launch of the country's first exchange-traded gold fund by Benchmark Mutual Fund has paved the way for investors to invest and trade in the yellow metal just like in any other equity investment.

But the scheme, called Gold BeES, may not attract investors in large numbers as having a demat account is mandatory for investing in the ETF. Besides, investors may not be keen to invest in this product since on redemption the repayment is done in cash and there is no physical delivery of gold.

These requirements hit fund houses' plans to garner big investments for such schemes as number of demat account holders in the country is small compared with the that of bullion investors. Traditionally gold has been a safe investment for future.

In a bid to overcome this issue, the fund houses are tying up with depository participants (DPs) and offering demat account services to investors, said officials.

"We have tied up with a few top DPs who on request by the investor would open a demat account within 24 hours," Rajesh Bhojani, president for sales, UTI Mutual Fund, said. The MF is expected to list its gold ETF scheme by the end of the month.

At present India accounts for 23 percent of the world's jewellry demand and around 35 percent of global investment in gold comes from the country.

However, a large number of investors put their money in gold not only to see value of their investment grow but also to use the metal for making jewelry later.

The MFs are also working out a strategy to pay back investors in the form of bullion.

"The physical delivery of gold on redemption is possible. New regulations are to be put in place," Sanjiv Shah, executive director of Benchmark Mutual Fund, said.

Benchmark BeES has collected around Rs 100 crore during its new fund offer period and received applications from 22 states in the country.

The minimum subscription for the scheme was Rs 10,000, while it is Rs 20,000 for the UTI's GETF scheme.

Besides Benchmark and UTI, five other MFs have also lined up to launch their gold ETF schemes.

Topazalt-PoG#1536143/22/07; 04:08:13

We're witnessing a nice advance in US$PoG here but the other currencies have Gold covered for the moment.
We're about to see if the nascent stage 2 Uptick has legs here as PoG moves from April Gold to Current Gold.
You can all but rule out London trade impacting PoG/S IMO as this NY Paper game has metal, Gold ...and particularly Silver, in it's grasp.
That's not to say the thing can't run. Watch as Current PoG rolls over and smokes not only Buck, but ALL the alts as well, in one fell swoop!

mikalGreat charts#1536153/22/07; 07:05:19

The Real Value of US Financial Markets When Deflated by the Euro and Gold, From May 1998 to the Present by Jesse
Four charts by this frequent Midas contributer- equities and treasuries deflated by gold revealing the "boiling frog syndrome" and the "crossroads" along with comments.

mikalCorrection#1536163/22/07; 07:11:10

As my title states, these charts are "equities and treasuries deflated by gold" AND EURO, not just "gold". Thank you.
USAGOLD / Centennial Precious Metals, Inc.An invitation to review the archives; join the NewsGroup for timely updates by e-mail!#1536173/22/07; 09:36:52">join the newsgroup
TownCrierMineweb interviews Paul Walker, CEO of GFMS, London#1536183/22/07; 10:47:03

Thursday , 22 Mar 2007
It's a good time of the year traditionally for gold. This time last year the price went from $550 above $700. Is there anything that tells you we could see a similar run?

Well, I think that, you know, people are always looking for particular trading patterns and regularities in this market, and you're right that over the last few years we have seen the price running up at this time of the year.

Really, what I think you need to do is just look at what's happening to the broader macroeconomy, you need to look at the gold market's specific data that's out there.

We're about to publish the gold survey next month, and the data there is broadly supportive of higher prices because I think demand has been fairly strong - even at $630, $640, $650. I think we'll find that at the moment the demand is coming off on the back of the price pushing above $660, but really the building blocks from the physical market side are there, the building blocks from the investment side are still there, and at the end of the day what's going to drive this higher? Well, there's going to be something that will trigger it and, you know, I've been looking for these particular triggers for some time.

Was it is going to be the problem with sub-prime lending in the US? Is that going to be the straw that breaks the camel's back and finally sees the dollar going to 1.40, 1.50, you know, possibly even higher against the euro?

Under those scenarios we're looking at $700 gold with great ease, and I think we're still in that position where these things are working through the marketplace. You're still seeing valuations on, for example, the Dow Jones, and I find I'm somewhat mystified as to how they can be justified by the fundamentals of those stocks.

And once the market has worked trough these things and issues like the under-pricing of global risk -- I mean, I can rattle off a million and one things that I've been talking to you about for the better part of a year, a year and-a-half -- that's when I think you'll see the price moving higher. But at the moment there's still this kind of hiatus where people are waiting for the economic data to come through, I guess, unambiguously in one direction or t'other, and you know this dithering about what the Fed is going to do and so on and so forth is a reflection of the kind of ambivalence that's out there in the market.

So you'll find it trading $20, $30 either wide of this, but our view at GFMS is still very, very clear that the building blocks are there for higher prices in the medium term. And I think we'll see $700 gold.

You know, arguably the longer it takes for the US economy to crack, the higher the upside is.

^___(from url)___^

That's all fine and dandy, but who needs the economy to crack to foresee higher gold prices?

After all, the global economy hasn't exactly "cracked" per se during the past six years, and yet during this common time the price of gold has been showing nice strength -- more than doubling from $255.

This represents 27% annualized gains.

To be sure, assuming we continue to allow gold's price to float, the "upside" of gold through time is WITHOUT LIMIT -- be they good times or bad. It's only the PACE (and path) of the climb, as influenced by many factors, that remains a matter of discussion.


mikal"Survey" weaker than expected#1536193/22/07; 11:08:03

US leading economic index weaker than expected | AFP | Business News - 22 March 2007 2331 hrs
Snippits: "WASHINGTON : A key measure of future US economic activity turned sharply lower in February, reflecting turmoil in the housing and manufacturing sectors, the Conference Board said Thursday.
The business research group's index of leading economic indicators fell 0.5 percent following a revised 0.3 percent decline in January.
Conference Board economist Ken Goldstein said the overall economic outlook remains positive despite the weak figure.
The index is meant to gauge economic activity in the coming six to nine months...
The index was below the average Wall Street forecast of a 0.3 percent decline and the latest in a string of weaker-than-expected economic reports."

mikalTemporary Open Market Operations#1536203/22/07; 11:41:31

Today's 17 billion Fed add insuring the perfected storm.
"Temporary Open Market Operations

To implement monetary policy, short-term repurchase and reverse repurchase agreements are used to temporarily affect the size of the Federal Reserve System's portfolio and influence day-to-day trading in the federal funds market.

Temporary Open Market Operations for March 22, 2007
Last Updated: March 22, 2007 9:41 AM
Number of Operations Today: 2"

mikal(No Subject)#1536213/22/07; 11:46:09

Housing, mortgage woes contagion feared - 03/21/07 Wed -- Snippit:
WASHINGTON (Reuters) - For months as the U.S. housing market unraveled, the Bush administration, the Federal Reserve, and most economists maintained the decline did not risk hitting the economy at large, but economists are growing increasingly concerned the broad economy may take a hit.

An abrupt exodus of more than two dozen so-called subprime lenders from the market has heightened fears other lenders may soon start choking off credit to businesses and consumers."

mikal(No Subject)#1536223/22/07; 11:52:02

Bernanke: Credit Key to Healthy Economy
March 22, 2007 - Snippit:
WASHINGTON (AP) -- The smooth flow of credit is "essential for a healthy economy," Federal Reserve Chairman Ben Bernanke said Thursday, amid continuing concerns about the impact of risky mortgage loans on the economy.

Bernanke, in brief remarks to a Federal Reserve conference, didn't talk about the economy, interest rates or problems with risky mortgages, per se.

But he did say, "Credit risk is a very important topic."

The Fed chief's remarks come amid recent turmoil on Wall Street about mounting troubles for lenders who made mortgages to people with blemished credit histories. Delinquencies and foreclosures for such risky mortgages are spiking, rattling investors and politicians.

Smoothly functioning credit markets are good for the economy because they support spending and investment by consumers and businesses alike. That helps to bolster economic growth. A credit crunch can have the opposite impact."

TopazAggie update.#1536233/22/07; 12:53:38

The "4 letter S word" might be "finally" coming to life here in late March.
A continuing flurry of activity at the warehouses, a nice little 130 contract equivalent delivery today (to best 5000 total for Mar) and a raggedy looking Spot chart augurs well for the the old girl in the coming daze methinks.

Please let it be dear God ...or management, whichever is the more omnipotent in this Market.

mikalDiseases lurk in the shadows#1536243/22/07; 13:39:26

Some still maintain a US avian flu outbreak will occur at some point in time. And there's a "new" disease in Mexico beginning to cause concern along the US border where outbreaks among illegals are increasing.

Report: Avian flu would sicken economy | UPI | Snippits:
"WASHINGTON, March 22 (UPI) -- A severe flu outbreak could put a huge dent the U.S. economy, according to a new study.
The U.S. gross domestic product could drop by nearly 6 percent, a $683 billion loss, says a report by the Trust for America's Health, a non-profit group that focuses on disease prevention.
"The U.S. is not prepared to face an economic shock of this magnitude," said Jeff Levi, executive director of the group.
In the advent of a flu pandemic on the scale of the deadly 1918 flu outbreak, 90 million Americans could be sickened and 2.2 million could die, the report says. That would result in many workers staying home from work and reduced consumer demand for products and services...

Washington, D.C., Maryland and Virginia -- because their economies are concentrated in government -- face the lowest predicted economic losses, the study's authors said."

mikalMissing the forest for the trees#1536253/22/07; 13:51:33

Crisis looms for entire economy
Congress must focus on rising mortgage defaults to prevent a slip in confidence leading to collapse
Peter Morris is chairman of the PRM Realty Group, with offices in New York and Chicago.
March 20, 2007 - Excerpts:

"If Washington doesn't address the rapidly building multi-trillion-dollar crisis in residential mortgage defaults, its paralysis will help trigger a national economic recession that could touch every homeowner.

The crisis has been building for months - if not years. Experts agree it is a result of banks and other lenders' granting home loans to people who were not truly able to afford the payments. Now, with the national economy in a slide, the number of mortgage defaults is rising at an alarming rate."

Mikal-- The author is typical of those who cannot see that a SYSTEMIC crisis awaits, not one in which solutions can be simply, easily focused on real estate. With a vested interest in real estate, it is small wonder they clamour for gov't(Federal and State) and private aid of all kinds- aid that is both unlikely and unfunded, and new "oversight" that would be too little, to late, and even in some cases, too MUCH, too late.

mikalOne more snippit (and reply) that didn't make it through the browser#1536263/22/07; 14:02:34

"Whether the fault of this mortgage crisis lay in the lenders' laissez-faire attitude or the distractions of presidential politics and a nation at war, the potential destabilization of our economy must occupy the political epicenter of our national debate. We need aggressive policies that create public-private risk-sharing and regulators who will unmask and prevent the unbridled greed that got us into this fix.
Congress must realize that we are on the abyss of an enormous economic crisis. Capitol Hill has the means, the opportunity and the motive to prevent a mortgage market collapse if it acts decisively.
The failure to act could do as much strategic damage to the United States as a terrorist attack, more lasting harm than a hacker taking down the Internet and more sustained pain to every American family than the collapse of Social Security."
Mikal-- There's more, but what he's saying is what we've been saying for years in a slightly different form. The day of reckoning is too close for comfort and entails a certain expectation, after manageable sacrifices and preparation, of great future success. The outlook for the future of politics is less clear, however if this writer and others like him expect progress, they mustn't use excuses like "greed" and "excessive risk-taking" to place blame primarily on consumers.

TownCrierIran gets 60 pct of oil income in non-USD#1536273/22/07; 14:29:43

TEHRAN, March 22 (Reuters) - Iran, embroiled in a nuclear row with Washington, is asking more clients to pay for oil in currencies other than the dollar and 60 percent or more of its crude income is in other units, an official said on Thursday.

Hojjatollah Ghanimifard, international affairs director of state-owned National Iranian Oil Company (NIOC), told Reuters almost all of Iran's European clients and some of its Asian customers had accepted making payments in non-dollar currencies.

He said Iran, which has pushed for payment in euros and other currencies since September when Washington slapped sanctions on a big Iranian bank, was concerned about the weak state of the greenback and not being prompted by politics.

Washington is leading efforts to isolate Iran over what it says is Tehran's bid to build atomic bombs. The United States has imposed sanctions on two big state banks and has urged international firms to avoid doing business with Iran.

Iran, the world's fourth biggest oil exporter, insists its nuclear plans are aimed at producing electricity so that it can conserve its oil and gas resources for export, and also to prepare for the day when its huge energy reserves run out.

"We have asked our clients that whenever they are ready to exchange the dollar into any other currency, including the euro, we would be welcoming that. In Europe, almost -- I can say -- all have accepted, in Asian markets some," he said.

But he said payments were still based on dollar pricing.

"Pricing as you know is based on the quotations that we get from the international market and when the international market quotes anything for crude or for the products all of them are for the U.S. dollar," Ghanimifard said.

^___(see url for full article)___^

Those of you who haven't yet read the "Thoughts!" of ANOTHER would be well-advised to do so now.

Why? Because that 'future'... is now. Or rather, we are On The Doorstep. The pricing mechanism remains an evolutionary work in progress. The gold market, too, is an associated work in progress.

Are you reading this one, G?


Sierra MadreHere comes Friday!#1536283/22/07; 16:30:24

Here comes Friday, and it's not TGIF, it's OMGIF - "Oh my God! It's Friday!"

What's it going to be? $645 or $601.30? When I see $663 just dribbling along and little or no action, I suspect the first guess is more likely.

But that is what makes GOLD so interesting. Thanks to the people who are doing their job at the Cartel, one can never really tell. Smart people, the Cartel! Always a new rabbit up their sleeve.

Meanwhile, two carrier groups are marking time off the coast of Iran and the mad, mad, mad, mad Veep has the button at arm's reach.

Times like these, and one feels like joining the St. Ewagiow. Get a paperback "The Funhouse", by Benjamin Appel. You'll find it a futuristic novel written about 1960, which talks about a Funhouse - a massive high-tech amusement park in Florida - when Disney World at Anaheim was just a dream of Walt Disney's.

At the Funhouse, the St. Ewagiow has hidden an A-Bomb. A detective from The Reservation has been hired to find the thing before it goes off. The Reservation is an area of the US that has been kept free of all government, so that there is a Reserve of rugged individuals that can be called upon for special services.

The St. Ewagiow - "Society to End the World and Get It Over With". The Society for those who have had their fill of this crappy world.

Well, I'm just joking of course. But, I do think it is true that this tremendous stress that most everyone is living in, is certainly not conducive to mental health. I do think we are all going just a little nuts, under the tension. This is no way to live and this situation must come to a moment of "release", as George at says.

Gold helps diminish stress, certainly, that's why all who can, should own some. However, we all hope the time never comes when we actually have to use it.


Sierra MadreOOPS! - A typo!#1536293/22/07; 16:35:35

My guesses should read, "$645 or $661.30?"


USAGOLD Daily Market ReportPage Update!#1536303/22/07; 16:40:04">
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

March 22 (DowJones) -- Gold futures were boosted overnight by yesterday's statement from Federal Reserve policy-setters, and strength in copper and crude oil Thursday also spilled over into the precious-metals arena, traders and analysts said. All of the precious metals ended up hitting roughly three-week highs.

April gold rose $4.20 to $664.20.

The metals began their surge in after-hours trading on Wednesday after the U.S. dollar sagged following release of a statement from the Federal Open Market Committee, traders said at the time. It was construed to lessen the chance of another rate hike but increase the odds of a rate cut later in the year.

Overnight, the euro hit a two-year high of $1.3411.

The metals remained stronger throughout Thursday's session, with a Comex gold/silver floor trader reporting that the recent uptrend in copper was spilling over into the precious metals. "Copper has been very, very strong the past couple of weeks," said the floor trader.

"We're slowly following it up. There is not a lot of volume being traded and not a lot of money coming into the metals right now. It seems like a lot is in the stock market and bond market. But slowly, drips and drabs are starting to come back in (to metals). People are starting to get long in gold and silver."

Bill O'Neill, one of the principals with LOGIC Advisors, described physical demand for gold as strong.

The metals previously fell in late February and early March due to outside issues, namely a tumble in equities that prompted traders to liquidate metals positions to raise cash. However, that pullback was not related to the metals' fundamentals, said O'Neill.

"Inflationary data has been a little on the high side. And oil prices all of a sudden are picking up again as well," said O'Neill. "All of that bodes well for the (metals) market. They're all in long-term uptrends."

A short while after Comex gold closed, May crude oil was up $1.54 to $61.15 a barrel.

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

TownCrierCourt: Cyanide Can Be Banned In Gold Mining#1536313/22/07; 17:03:24

(AP) DENVER -- The Colorado Court of Appeals has ruled that counties have the authority to ban the use of cyanide in gold mining under a state law that preempts counties from taking other steps to regulate mining.

In its two-to-one ruling today, the court says the state Mined Land Reclamation Act takes precedence over any county or local regulatory standards for restoring land damaged by mining activity. But the ruling says Summit County's ban on the use of cyanide had nothing to do with land reclamation.

The ruling reverses a trial judge's August 2005 order throwing out the county's ban.

The Colorado Mining Association sued to challenge Summit County's ban after county commissioners approved it in June 2004

...Conejos, Costilla, Gilpin and Gunnison counties have similar bans, and other counties are considering banning the use of cyanide in gold mining.

^___(from url)___^

From a combination of reasons, including legislative as seen here, it continues to become more and more difficult to prize new ounces of gold from the ground.

Accumulate yours cheaply while you still can.


MKTownie. . .Cyanide#1536323/22/07; 18:50:20

Leave it to the home state to not only assert states' rights but county rights as well!! There was a day when this would have had the Reaganites kicking into full gear. . .But, alas, those days are over.
GoldiloxMining Rights#1536333/22/07; 19:19:15

@ TC, MK,

Given that someone else just lost a land-use rights suit because it "violated NAFTA precedence", this is significant, although it pretty much follows the spirit of the Montana law that crippled Canyon Resources.

I wonder how high up the Court chain this will travel?

GoldiloxMissing the Forest for the Trees#1536343/22/07; 19:24:22

@ Mikal,

I agree with your analysis. The author seems to think, like some FED officers have, that the solution to their excesses lies in "more liquidity" to bail them out from the ravages of "too much liquidity".

ThoreaulyTC#1536353/22/07; 19:40:38

Still awaiting, honestly and earnestly, your reply to me last post (3/20/07; 19:55:02MT - msg#: 153581)
Chris PowellRun for your lives! Fedsters laud credit derivatives#1536363/22/07; 19:46:50

Rise of Credit Derivatives
Said Boon to U.S. Economy

By Krishna Guha
Financial Times, London
Friday, March 23, 2007

WASHINGTON -- The explosive growth of credit derivatives has strengthened the US financial system, making it more efficient and more resilient, two Federal Reserve governors declared on Thursday.

Their comments suggest the Fed believes the financial system is in better shape than in the past to withstand shocks and might absorb losses from the subprime mortgage market.

One of the governors suggested that the Fed would be wary about drawing conclusions about what movements in stock and bond prices say about the economy.

Don Kohn, Fed vice-chairman, said: "As these markets develop and become more complete, they facilitate risk transfer and diversification, thus increasing the resilience of the financial system.

"Credit derivatives, like all derivatives, are in zero net supply and, abstracting from the important issue of counterparty credit risk, they neither add to nor subtract from the stock of financial risk in the economy."

Mr Kohn added that credit derivatives "do, though, provide new and more efficient ways for sharing and hedging the risks that do exist and they facilitate the transfer of those risks to those who are most willing to evaluate and bear them."

Randall Kroszner, a Fed governor, said: "These developments have greatly enhanced the efficiency and stability of the credit markets and the broader financial system."

He added that many concerns about the development of credit derivatives were ill-founded and that 70 percent of outstanding credit derivatives were not complex products at all but single-name credit default swaps -- simple products that insure against the likelihood that a particular borrower will default.

Most der­ivative contracts entered into by banks with unregulated entities such as hedge funds were backed by collateral, Mr Kroszner said. But creditors should exert effective discipline on hedge funds to ensure they did not take ill-judged risks.

Both governors flagged up the risk that defaults on credits embedded in complex derivative portfolios could be more closely correlated than banks believed, resulting in potential for higher-than-anticipated losses in bad times.

Mr Kohn said that, while the Fed monitored markets closely, it would be wary about drawing strong conclusions from recent market volatility that the economy was in trouble. Economists did not understand why the risk premium on shares or corporate bonds was as high as it was, or why it varied as it did, he said.

"All these problems complicate our interpretation of what implications, if any, movements in equity markets have for the economy."

Chris PowellNext week, an EFT for credit derivatives#1536373/22/07; 19:47:57

Eurex Has Confidence
In Credit Derivatives

By Paul J. Davies
Financial Times, London
Thursday, March 22, 2007

Eurex is confident that the world's first exchange-traded credit derivatives contract will take off when it launches on March 27 in spite of the reticence of many investment banks about becoming involved with the product.

The German-based derivatives exchange, partly owned by Deutsche Borse, said on Thursday that the product had huge potential and would open the world of credit derivatives to a broader range of participants, many of whom are restricted from trading in the established, private, "over-the-counter" markets.

The explosive growth of credit derivatives in the past few years has left exchanges around the world keen to gain a slice of this business. The Chicago Mercantile Exchange and the Chicago Board Options Exchange are also planning credit derivatives launches.

However, investment banks have seen a strong and highly profitable market develop off exchanges and only SG CIB, the French investment bank, has so far come out publicly in support of an exchange-traded product. Many banks at best say they will wait and see whether it is something their clients want to trade before getting involved.

Peter Reitz, a member of the Eurex executive board, said: "The long-term potential is huge for this product, although how long it will take to evolve, we are not so sure."

Eurex said that while several banks were still in a testing process for the futures, it would have price providers on the exchange on its launch.

However, some banks saying it will only increase efficiency for those who wanted to trade in smaller ticket sizes than the E10 million minimum used in OTC markets.

TownCrierFor Thoreauly,#1536383/22/07; 20:02:30

Please be assured that the two responses I've already given you represent the best effort I have to illuminate the matter for you. If you are sincere about pursuing the matter, my firm belief is that a dedicated open-minded rereading of those posts would likely prove to be better food for thought than having me try to rehash those potatoes.


Chris PowellCramer tries to wiggle out of confession to market manipulation#1536393/22/07; 20:47:53

10:40p ET Thursday, March 22, 2007

Dear Friend of GATA and Gold:

CNBC market guru, founder, and former hedge fund manager Jim Cramer today briefly answered criticism of the comments he made on's "Wall Street Confidential" program December 22, 2006.

Cramer declared today that he respects the securities laws, never violated them at his hedge fund, and always "played fair." And yet the videotape of the December 22 program shows him confessing to aggressively manipulating markets in his hedge fund work.

Maybe there IS a distinction between manipulating markets and violating securities laws, but on that program Cramer said what he said -- not just that manipulative trading goes on every day but that he himself was one of the manipulators, and that, indeed, manipulation is essential practice for ALL hedge funds.

Cramer's "explanation" is appended, along with the official link to the December 22 program. See for yourself again.

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

* * *

The Least I Owe You

By Jim Cramer
Thursday, March 22, 2007

You may have seen some articles the past several days attacking me about an interview I gave recently where I discussed the kinds of manipulative trading practices that go on every day in the investing community.

Let me say this: No one knows and respects the securities laws more than I do. (I didn't go to Harvard Law School for nothing!)

When I was a hedge fund trader in the 1990s, I played fair, and I did nothing that violated those laws. But others did not play fair, and that's why I started and have been writing about these abuses for nearly a decade -- to explain to my readers how the markets really work. I wanted to give transparency to the market and tell people the good and the bad.

Some professional traders don't like it when I expose how their game is played, and some of the's competitors don't like it when people are interested in what I have to say. But I am going to continue to write and talk about how the markets really work -- in my own sometimes hyperbolic and tongue-in-cheek style -- and call them as I see them. That's the least I owe you.

* * *

Editor's note: Click here to view the video, which aired Dec. 22, 2006, on TV:

mikal(No Subject)#1536403/23/07; 01:12:17 Jim Cramer's big mouth - MarketWatch - Thomas Kostigen - March 23, 2007
mikal(No Subject)#1536413/23/07; 01:22:50 Defending Cramer's trading warts - Allen Wastler | CNN | Thursday, March 22, 2007
mikal(No Subject)#1536423/23/07; 01:33:00 Crude oil prices surge 3% as U.S. gasoline stocks tighten | Matthew Robinson | Reuters | Mar 22, 07

mikal(No Subject)#1536433/23/07; 02:56:53

How consumers hijacked the media model by Bambi Francisco
MarketWatch - March 22, 2007

SundeckWar, Energy, Banks & USDollar#1536443/23/07; 06:04:55

...from Jim Willie...

...a wide-ranging rant with some sobering charts showing decline in Saudi oil production...which really is a blue-whale in the baby-bath, a dinosaur on the dinner-table...not to mention an elephant in the living-room; all in one...

...but that is just my view.


ThoreaulyTC#1536453/23/07; 06:15:09

You invited others to comment, but no one did, probably because they're as flabbergasted as I am that you oppose a gold standard. Perhaps there's confusion about what is meant by the term, my definition being private, 100% metals-backed money that includes the digital variety that Richard Rahn describes in the linked article.

I believe others refer to this as freegold -- which would put an end to the fraud government-issued fiat currencies -- but whatever it's called, is this something you would favor or oppose?

flow5Gold Standard#1536463/23/07; 06:31:04

flow5 (2/11/07; 21:44:44MT - msg#: 152006)
Gold Standard

A pipe dream.

Paper Avalanche@ Thoreauly - I will jump in on this one FWIW#1536473/23/07; 07:04:22

Without having read the article you linked, my thoughts are that having gold / silver backed money is only amenable to the freegold concept where investors / businesses / countries / banks exchange gold or silver at a given weight (i.e. an ounce or fraction thereof) and nothing more.

The danger lies in when governments assign a national unit description (i.e. franc, pound, dollar, etc.) to said weight of gold or silver. That starts the slippery slope of inevitable fraud and deception that the US dollar endured (which is orginally defined as 1/20th of an ounce of gold or approx one ounce of silver). Over the past 140 years since the civil war the US dollar (silver) has evolved into the worthless script that it is today via the following evolution:

1. One ounce of silver

2. A note stating that one ounce of silver is on deposit at the treasury and will be paid to the bearer on demand

3. A note stating that the bearer is entitled to one dollar's worth of silver (which is less than an ounce at then market prices - but a clever nuance nontheless to accelerate the fraud) not a specific weight of silver (an ounce)

4. A note that is no longer by anything at all

IMO, this can be avoided by governments not defining a specific weight of gold or silver as a form of national money (i.e. franc, pound, dollar, etc.) to begin with. Doing so sets the stage for subtle changes down the road for banksters who will have said politicians rewrite the rules a generation or two out to result in the same monetary evolution detailed above wrt the US dollar.

Absent the trading of gold / silver in universal weights that are wholly allocated and not encumbered by government-issued notes which will invariably be abused, anything else is not pro-freegold. IMO, the central thesis to the freegold concept is gold as a STORE OF WEALTH and not, not, NOT money. This is crucial to understand, again IMO.

I may be wrong. I often am.

Best regards,

contrarianWould You Like Your Money in Gold or Notes?#1536483/23/07; 07:20:50

Saw an old movie last night, "Johnny Guitar", set in the Old Wild West, mid to late 1800's, when the railroads were expanding West. Vienna (Joan Crawford) decides to get outta town, goes to the bank to withdraw her money, and the teller asks her "Would you like your money in gold or notes?" "Notes is fine" she says. Now why can't we go back to the days of the Old Wild West, when people knew what real money was. Banks weren't looting people, people were looting banks!
Thoreauly@ PA and flow5#1536493/23/07; 07:24:21

Thanks, PA, as that's certainly an accurate recap of the dollar's demise. I don't understand why freegold wouldn't also be money, however, since, along with being a store of value, it would be a medium of exchange as well.

As for a gold standard being "a pipe dream," what do you foresee instead, flow5? The NAU and the amero, perhaps, followed by the merger of these monsters, decades hence, into a world state, their fiat currencies merging into a single "unio"?

This is the banksters' dream, no doubt, along with their fellow globalists, no matter what a living nightmare it would be for the rest of us.

But can they in fact pull it off? If not, then again, what do you foresee?

What do any of you foresee? TC? MK?

mikal(No Subject)#1536503/23/07; 08:15:05

15 British sailors detained by Iran - - Mar 23, 07
USAGOLD / Centennial Precious Metals, Inc.A world of gold at your fingertips...#1536513/23/07; 08:32:58">gold -- a global calling card
GoldiloxDetentions#1536523/23/07; 09:09:53


Wow, no mention of the coalition detention of Revolutionary Guard members earlier in the week in the USA Today article, even though it can't be more obvious that the Iranians are playing "You kidnap ours, and we'll kidnap yours."

No shots were fired, but that pleasantry can't last if the kidnappings continue on both sides.

Any responsible journalist should have linked those together, but like the detention of US Embassy personnel in 1980, the public is NEVER given the whole story.

It was years before anyone reported that the US Embassy detention was in response to US banks "freezing" $billions of Iranian government money as reparations for the deposed "Shah".

Paper AvalancheWill wonders never cease....#1536533/23/07; 09:15:51

The traditional smack down at 10:00 am CST has commenced in earnest. You can set your watch by it these days.

It would be more fun if it were not so predictable.


ge@Thoreauly #1536543/23/07; 09:23:42

According to the book titled "THE THEORY AND PRACTICE OF OLIGARCHICAL COLLECTIVISM" by Emmanuel Goldstein, the problem of the current ruling elites is that automation tends to destroy the hierarchical structure of societies. Fiat money is probably one of the countermeasures designed by the elites to stave off defeat.
"In earlier ages, class distinctions had been not only inevitable but desirable. Inequality was the price of civilization. With the development of machine production, however, the case was altered. Even if it was still necessary for human beings to do different kinds of work, it was no longer necessary for them to live at different social or economic levels. Therefore, from the point of view of the new groups who were on the point of seizing power, human equality was no longer an ideal to be striven after, but a danger to be averted."....

"In a world in which everyone worked short hours, had enough to eat, lived in a house with a bathroom and a refrigerator, and possessed a motor-car or even an aeroplane, the most obvious and perhaps the most important form of inequality would already have disappeared. If it once became general, wealth would confer no distinction. It was possible, no doubt, to imagine a society in which wealth, in the sense of personal possessions and luxuries, should be evenly distributed, while power remained in the hands of a small privileged caste. But in practice such a society could not long remain stable. For if leisure and security were enjoyed by all alike, the great mass of human beings who are normally stupefied by poverty would become literate and would learn to think for themselves; and when once they had done this, they would sooner or later realize that the privileged minority had no function, and they would sweep it away. In the long run, a hierarchical society was only possible on a basis of poverty and ignorance."

GoldiloxGeorge trumps BB#1536553/23/07; 09:24:05


From the emails:
"I found you only about a week ago and have been reading what you have shared. You have mentioned in one of your letters that you have moved your investments into tangible assets. What do you have your money invested in? From what I have read about the housing market, I would imagine that you did not put your life savings into more property. But then, I can't figure where you would have put it. Please share that with me."
In no particular order? Dehypnotize from mainstream media. Downsize voluntarily. Use your downsize as a tool to get out of debt. Pay your credit card off so you don't pay banks interest. Get 6-months to a year of money in the bank at a subsistence level - better: get it in gold. Banks can close. Move to a few acres if you can and put in a garden. Grow food. Have a well. You need to plan on being self-sufficient. Partner with neighbors. Demand Constitutional accountability. Vote against American family dynasties, such as the Kennedy/Bush/Clinton, etc. clans and the liberty-stealing plans (like the North American Union) fomented by their minions. Own a gun. Guns. A side arm, a long arm, a shot gun.) Have ammo. Take gun safety courses. Shoot regularly. Spend time with your kids. Get a ham radio license - no code required now - ditch the cell phone. Don't eat GM foods. Get/grow heritage seeds. Keep organic wherever possible. Cut out unnecessary monthly recurrent bills. Have one parent in the home when kids are of school age. Build a shop. Own a generator. Read books. Learn new skills constantly. Own your life.

You also, by the way, own your government. Not the other way around. Says as much in the Constitution. Read it. Again. Bill of Rights, too..

And get that all done by Monday, would you?

SurvivorFreeGold, BB, Goldilox, Urban Survival, and msg# 153655#1536563/23/07; 10:34:43

Wow. That describes my life exactly! Get it done by Monday? Sure. Took me a lifetime. Had to get past misdirection, indecision, sacrifice, bad luck, and impatience! :) But, I have been there for many years now. It lets me watch with interest and amusement the things that others watch in fear or horror.

Freegold: Regarding any future linkage between paper currency and gold/silver, I agree with Flow5. There will be no linkage in the US unless we return to constitutional government. The US constitution has been in a death spiral for most of a century; it will take at least that long for a new constitutional government to emerge within these borders – if it ever happens.

In the meantime, the REAL freegold is with us now. You are free to buy it, hold it, and sell it. Don't worry. Be happy. When in doubt, buy some more!

- Survivor

flow5Definition, Fiat vs. Managed-Currency System#1536573/23/07; 12:46:20

The essence of a managed-currency system, is a system in which the volume of currency in circulation is impersonally determined by the total effective demands of the public or the amount which meets most closely the needs of trade. The basic process by which currency is put into and taken out of circulation is through the banking system. This particular procedure distinguishes a managed-currency system from a fiat currency system and makes our currency self-regulatory. While the money supply as a whole is not self-regulatory and must be kept under careful surveillance and control by the monetary authorities, the currency part of our money supply can be left can be left free to seek its own level.

Even in a managed system, however, governmental fiscal, monetary, and debt-management practices can influence the volume of currency held by the public, although the volume cannot be determined by any governmental edict, law, or administrative practices. The public's holding of currency will be influenced by governmental practices which change public expectations in regard to such matters as prices, income, and employment.

A fiat system is one in which the volume of currency issued is dictated by the deficit-financing requirements of the issuing government. In a fiat system the volume of currency is not self-regulatory, for the more issued the higher prices will rise. The rise in prices creates a demand for still more currency, and soon the government's credit, probably in jeopardy when the fiat system was first introduced, becomes completely undermined. A hyper-inflation then follows inflation with the price level perhaps completely "running away" In short, the currency becomes worthless and ceases to fulfill its role as a medium of exchange.

flow5Foresee#1536583/23/07; 12:50:04

A continuation of the current trend, larger federal deficits, and larger trade deficits, until the credit of the government is put in jepordy, and the dollar declines to a level that will force a balance of payments on us.
SurvivorFiat vs. Managed-Currency System#1536593/23/07; 13:33:03

@Flow5. In practice, is Fiat vs. Managed-Currency a black-and-white dichotomy or more of a grey-scale concept?

Which definition best characterizes the US monetary system at this time? Which one describes the early FED years?

- Survivor

USAGOLD Daily Market ReportPage Update!#1536603/23/07; 14:21:37">
The Daily Gold Market Report has been updated.

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

FRIDAY Market Excerpts

Traders take profits from gold's weekly gains

March 23 (MarketWatch) -- Gold futures closed with a loss Friday as traders locked in a six-session gain of more than 3%, but prices still finished the week over $3 higher.

"Nervous and technical traders moved in to take gold lower Friday using U.S. housing data as the excuse to lock in gains and in the process hit a technical support level to sell gold off further," said Peter Spina, chief investment strategist at GoldSeek. "Gold is grinding its way higher, while still consolidating from the prior correction," he said.

The COMEX April gold contract closed down $6.90 to trade at $657.30. On Thursday, the contract closed at a three-week high of $664.20. It had climbed $21.70, or 3.4%, over the course of six trading sessions.

In the backdrop, the dollar advanced against European currencies Friday after a report showed sales of U.S existing homes unexpected rose last month. Sales of existing homes unexpectedly rose 3.9% in February, reaching a seasonally adjusted annual rate of 6.69 million units, the National Association of Realtors reported Friday.

Gold futures shrugged off news that 15 British sailors have been detained at gunpoint by Iranian forces while patrolling off the coast of Iraq. Crude-oil futures, in contrast, rallied on the report.

A British Navy boarding party had completed an inspection of a merchant ship when Iranian vessels surrounded the British forces, and then escorted them into Iranian territorial waters, the U.K. Ministry of Defense said. May crude climbed past $62 a barrel to a two-week high.

Looking ahead, "rising energy costs and the inflationary impact this will have not only on the U.S. economy but globally, will likely prove very supportive to gold and its unique anti-inflationary qualities, mid to longer-term," said James Moore, metals analyst at TheBullionDesk.

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

TownCrierZimbabwe: Gold Mines Face Imminent Collapse#1536613/23/07; 14:30:14

(Harare) March 23, 2007 -- ZIMBABWE'S gold mines face imminent collapse as it emerged this week that the Reserve Bank of Zimbabwe (RBZ) is failing to pay them for gold deliveries made since last November.

Sector players say they could be forced to shut down their mines if the central bank does not pay for deliveries in foreign currency in the next few weeks.

BusinessDigest understands that troubles in the gold sector are also likely to intensify on news that the central bank has no plans to devalue the dollar in the first half of the year.

Mines have been clamouring for a devaluation, arguing that the current rate of $250:US$1 at which they are getting 25% of their gold sales is undermining their viability.

Gold mines are supposed to get 75% of their gold sales to the central bank in foreign currency while the remainder is paid in Zimbabwean dollars at the official rate.

...The central bank is understood to have told some mining executives that it does not have foreign currency and instead offered to pay them in local currency at the ruling exchange rate.

The miners rejected the offer...

A central bank official said it was highly unlikely that gold mines would get any joy because the central bank does not have foreign currency.

^___(from url)___^

Understand that this is (bad) politics, NOT economics.


melda laureWeekend sale.#1536623/23/07; 16:20:17

And you guys call yourselves TPTB, what a bunch of wusses, iz that the best you can do, 655? Howza poor elf gonna retire if I cant load up at under $600!!? I thought you guys were supposed to be giving this worthless stuff away? I'll never be able to afford a 400 oz good delivery bar at these prices. How am I supposed to pave my shower stall when you cant get your act together? Geez, it's like, you've all lost your grip or something.

Or was that a stranglehold?

Toolie@melda laure#1536633/23/07; 18:14:21

I'm with you. I'm planning on a golden brick patio though. Yep, just as soon as that gap between $20 and $35 is filled.
CometoseCOT#1536643/23/07; 18:27:05

The combined options and futures postitions Commercials held this week changed in the manner following

Commercials in Silver were net long appx 700 contracts

Commercials in Copper were net short appx 4000 contracts

Commercials in Gold were net long appx 2000 contracts

TownCrierThoreauly, I think the only hope here is to try to reframe this basic monetary 'bizness' for you#1536653/23/07; 18:30:09

To do this I must shamelessly borrow an instructional tool that, admittedly, I've seen wielded better in the hands of others. So please bear with me.

Imagine yourself on an extended camping trip. With you are two of your buddies. You're gathered around the campfire one evening. You would like to harvest and then sharpen the end of a hefty twig so that you may skewer and safely roast some food near the flame.

You turn your pockets inside out, but to no avail.

You turn to your nearest friend, Ian. He upon reaching into his own pocket he produces only a note -- an IOU to be exact.

"Oh, that's right," Ian says. "Last week I lent my knife to my son."

As he sits there offering you the note in his outstretched hand, ANOTHER hand reached toward you in the warm yellow glow of the firelight. "Here, use this," says the voice of your other friend, Godfried. Nestled there upon his open palm is, apparently, the only physical knife in camp.

Upon closer inspection, it's not "just" a pocketknife. It's actually one of those fancy all-purpose Swiss models. Ian recognizes it as the same as his (a birthday gift from his wife), the kind of knife that can do just about anything -- from chopping lumber for building a cradle, to peeling potatoes, to digging your own grave.

Seeing that you are nearly paralyzed, completely and utterly in awe of his property, your friend Godfried withdraws his arm. He crosses over to a nearby thicket and soon reemerges with a wand of brich that's perfectly suitable for the cooking task at hand.

As you undertake efforts to char a marshmallow, you watch your friends each return the real knife and the IOU-knife to their respective pockets, and you make a mental note of a lesson learned.

Imagine that a few days of canoeing and fishing have passed. A perfect morning has dawned, and an extended hike has been decided upon as the ideal activity to explore what the surrounding landscape has to offer for the remaining week of your vacation.

Packing up some light gear good for two days away from basecamp, the three of you set out upon a nearby Trail. After half a day's walk, you break for lunch at a pleasant spot where two roads diverge in a yellow wood.

As you eat, your party of three contemplates the decision of the road(s) ahead. To best broaden the group's exposure to the resources of the region, it is decided that you will spit up in order to collectively gain the knowlegdge obtainable from both roads.

Unable to split the group evenly, your adventurous spirit has you voluteer to be the party of one. It also becomes necessarily appropriate to redistribute the singularly-suitable collective gear to best accommodate two separate parties. A flurry of activity resembling barter commenses in which canteens, foodstuffs, and other items of worth are assessed, divided where possible, and traded 'round. What began easily becomes difficult -- how to deal with the few unique, important items. Which party gets the lighter, which gets the compact fishing pole, etc. Despite the share-and-share alike spirit of cooperation, the "who gets what" question for these highly-prized items is initially decided upon the foundation of actual personal ownership of the item.

Anticipating the needs of the day-and-a-half ahead, you calculate that it would be worth offering a trade of both your hatchet and your compact-shovel in return for Godfried's multi-utility knife of Swiss persuasion.

You make the offer to Godfried.

Godfried elbows Ian.

Ian, being quick on the uptake, pulls out his IOU.

You laugh dismissively.

Ian, ever the clever one, tries to massage new life into the deal.

He suggest that, now reminded of this abundance in supply, you've shrewdly determined that his party doesn't need TWO knives, and are therefore holding out to renegotiate a better offer.

He suggests a market 'discount' is indeed probably appropriate, given this vast supply, and therefore proposes that the trade commence for the shovel alone -- effectively half the price of your original offer.

Laughing twice as hard as before, you shake your head (effectively setting the price at ZERO), then you shoulder your pack and set off down the road less traveled -- thus filling the heads of both parties with lingering Thoughts(!) of the workings of the shrewd marketplace and its inexplicable pricing discount when offering judgement upon the value of "knives".

To put a finer point on it, when you insist that gold ought to be brought back into full function of money, whether you realize it or not, and certainly you do not, you are effectively asking that gold be marginalized as IOUs in the economy, to suffer the resulting discount by the marketplace as demonstrated in the parable given above.

Visit the URL provided for more precise insight and instruction.


flow5Fiat vs. Managed-Currency System#1536663/23/07; 19:16:34

Fiat paper money, such as the Civil War greenback and the inconvertible currency issued by the Confederacy, was issued directly to defray the government's expenses, it added to the total money supply, increased inflationary pressures, accentuated the loss of confidence in the government's credit, and created a need for still more issues.

Today we have only the Federal Reserve Note, and there is only one restriction placed upon its issuance. No Federal Reserve Note can be put into circulation unless there is a prior transaction involving the relinquishing by the public of an equal volume of bank deposits, and an equal diminution of the holdings of Interbank Demand Deposits (IBDDs) on deposit with the Federal Reserve Banks; In other words, the issuance of our paper money contains no inflationary bias. Its issuance does not increase the volume of money. It merely substitutes one form of money for another form (the essence of a managed-currency system).
In the period from 1913-1933 we had neither. During the "early years" we needed a central bank that could and would pump IBDDs into the commercial banks in a volume sufficient to satisfy the public's demand for currency, specifically paper money (currency is an asset the Fed does not, should not, and cannot control). In the control of the monetary aggregates, the monetary authorities are completely dependent on their power to control the volume of bank credit.
It was not until 1933 that we began to unshackle our paper money from the numerous and unnecessary restrictions pertaining to its issuance. With the numerous types of paper money in circulation at the time, this would seem to have been a non-problem. Here is the list: gold certificates, silver certificates, national bank notes, United States notes, Treasury notes of 1890, Federal Reserve Bank notes, and Federal Reserve notes. With that array of paper money there should have been plenty to meet the liquidity demands placed on the banks by the public. But the volume of each type that could be issued was so circumscribed by restrictions that even the aggregate group could not begin to meet the panic demands of the public.
We now actually have a central bank. It is called the Federal Reserve Bank of New York. An amendment to the Federal Reserve Act in 1933 established The Federal Open-Market Committee and gave it the power to control Total Reserve Bank Credit. The Fed can now buy an unlimited volume of earning assets. (With the federal debt at over 8.7 trillion, and expanding, and billions of dollars of "eligible paper" available, the term "unlimited" is not an exaggeration in terms of any potential needs of the Fed.) In the process of buying Treasury Bills etc., new InterBank Demand Deposits (IBDDs) are created. These deposits can be cashed by the banks into Federal Reserve Notes, without limit, on a dollar-to-dollar basis.

flow5For Opportunists...#1536673/23/07; 21:14:49

Short gold now.
melda laureExcellent marshmellon roast. Sir TC.#1536683/23/07; 22:20:34

Where is the payday-cupcake story?
melda laurePaper bullets, shoooting blanks.#1536693/23/07; 22:28:27

HOF nomination, sir TC. I would like gold to be brought back as ordnance, though coins might suffice. In reference back to zimbabwe, what they need is not foreign currency but for someone to build a mint- but the "profits" for the government mightn't be as lucrative.
mikal"Chuck checks in", TC, etc.#1536703/24/07; 00:19:02

If you have a subscription to this site (or free trial) by Bill Murphy, you can read some amazing things and the last few weeks seem particularly good.
That's because I'm not seeing anything but an improving outlook for gold every month going forward. Especially as I read all the blogs, letters, news & commentary and as I post links and discussion.
For example, "Chuck", Bill and others have some new, pretty major revelations at Lemet's "Midas" section today.
All told, you can't deny the foundation for gold is not just geopolitical and political, economic, financial and monetary, technical, cultural, etc. It's a base you don't talk about so much as share, having accumulated
understanding and experience of years.
Though it's reflected in each day's news and revelations which become increasing bullish, it's becoming focussed and rarified and condensed to a state where fewer words are required to effectively convey it's condition.
And the state of the all world's markets and countries and people are no less relevant to gold, crucially affecting and affected by it.
At some point WORDS WILL NOT describe gold's foundation and presence, often felt and known but never as plain and tangible and practical as the day that approaches.

GoldiloxWater as the next political "commodity"#1536713/24/07; 00:56:53

1. Investing in Water: Blue Gold
By Chris Mayer

A gallon of crude oil costs $1.45. A gallon of Evian costs $11.91. This simple observation led one successful investor to assert that oil is undervalued.

We see things a little differently...Oil may be undervalued, but NOT relative to drinking water. For most of the world, clean drinking water is a far more precious commodity than oil.

While water largely covers this hardscrabble little planet of ours, less than 3% of it is fresh water. And the presence of pollution and disease has made much of that water undrinkable. Unlike with oil, no amount of technological wizardry can replace water [that statement is misleading, since the technology certainly exists to clean up water supplies - G'lox]

Water resource enthusiasts, such as money manager John Dickerson, know these facts well. He is familiar with all of water's charms — but the biggest is the simple scarcity of clean water.

2. Dirty Water, Clean Profits

"Unlike other commodities, the demand for water is unwavering and certain. What's more, water does not suffer the threat of the discovery of an 'alternative' source. No 'alternative' water will present itself in the future."

by Eric J. Fry

Dirty water is a worldwide tragedy. Clean water is a worldwide investment opportunity.

3. Fortune Magazine predicts:

"Water promises to be to the 21st century what oil was to the 20th century: the precious commodity that determines the wealth of nations."


For those missing the current scramble for water control, here is a source that collects and disseminates information, although not without its own biases. There are those who suggest that the real "causes" of climate change and timeline are being held close to the vest, while shills like Al Gore and other publicity hounds mistakenly lead us down avenues of half-truth and misdirection.

Don't have a source to verify it, but a number of Internet pundits have suggested that the new Bush Ranch in Paraguay sits atop one of South America's largest aquifers - certainly more important than lack of extradition at his level of global "amnesty".

LebiequeHard Money#1536723/24/07; 02:19:51

Now that we know, what we've always suspected, that the Stock-markets, Futures-markets, Bond-markets and Derivative-virtual-markets, can and are being, as we speak, acted upon by the HedgeFunds at will and without fear. Remember, we've got it from the mouth of America's No.1 speak-easy Super Horse after all. We can now and for ever more all rest in peace. Never again will we have to fear a correction in anything. Milk and honey will forever be sloshing in ever greater waves over Dulls ville. And it's all so simple. Every month a larger slice of the fixed income, or effectively zero interest, of the aged is confiscated to satisfy the greater needs of corporate hegemony (sic) and it's young in-house whiz-kids, whose escalating incomes are thankfully inflation proofed. With a regulator, also with inflation proof income naturally, looking on, feigning helplessness and paying homage to his own good deeds in affirmative action, fight against poverty, gender workshops, concern for the children and keeping track of his donations for the cause. Tomorrow is so far away it barely warrants a thought. Anyhow, there's always the venerable Bob Mugabe's fight against inflation, by simply decreeing the elimination of three, or was that nine naughts, to make counting of his currency easier.
GoldSilverRatioFlow5: Dismal Monetary Science#1536733/24/07; 07:17:18

Flow5: Would you please identify for us the source of your fiat-apologist information? I am firmly in the camp of
Antal E. Fekete of Gold Standard University who wrote in his THE GOLD STANDARD MANIFESTO on the subject of dismal monetary science and the reason for it: "The Federal Reserve …in making grants to anybody pretending to be able to write awe-inspiring, mathematically convoluted, nonetheless vacuous, papers on macroeconomics, or anything else of which the fraudulence and charlatanism is hard to detect.
As a result of this immoral way of financing research a veritable deluge of worthless papers has glutted the technical literature on money which has one common earmark: they all attempt to defend the indefensible. They try to defend the issuance of irredeemable promises to pay: the bonds issued by the Treasury and the Federal Reserve notes issued by the Federal Reserve banks. Thus, then, the basis for money creation is the flimsy check-kiting scheme whereby the Federal Reserve banks buy the bonds with the notes while the Treasury uses the notes to pay the bondholders at maturity. The bond is supposed to have value because it is ‘redeemable’ in the note which, in turn, is supposed to have value because it is ‘backed’ by the bond. In effect both instruments are irredeemable and both lack backing in the form of any verifiable wealth. At the heart of the money-creating process, however explained, analyzed or defended, is the stubborn fact that both the Treasury and the Federal Reserve banks are privileged to issue obligations that they have neither the intention nor the means to honor. For any other would-be check-kiters the running of such a scheme would constitute a crime dealt with by the Criminal Code.
This double standard of justice has, of course, an immensely demoralizing effect. But what concerns us here is that the grant departments of the Federal Reserve banks have effectively put themselves in charge of deciding what should and what should not be researched on the subject of money. While they control research on money directly, they control the appointment of heads of economics department and directors of research institutions and other think-tanks indirectly.
This incest in financing research stands without precedent in the entire history of science to the eternal shame of our "enlightened" age, regardless what yardstick we may choose to measure it, of which the dollar amounts of grant money is only the most conspicuous, but we should not ignore the more subtle yet more persuasive methods of arm-twisting: bribe and blackmail."
We do ourselves a tremendous favor by reading Antal E. Fekete's extensive and extraordinary writings and signing up for Gold Standard University.

flow5Enough Journalists; Where are the Prognosticators?#1536743/24/07; 07:21:47

Wake up & smell a.m. coffee. There is always a reason for market movement.
slingshotGreat Day to be a Goldbug#1536753/24/07; 09:04:14

Just wanted to chime in and let you know what is happening in the Flea Market/Swap Meets. The number of venders selling coins has grown. There use to be only two. Now there are six. Morgans and Peace dollars both slabed are up in price. Some are selling 1/10 and 1/4 gold Eagles and these people are now regulars at the market. The new Washington Dollar is selling at $1.50 to $2.00 ea. I just do not get it. The low grade silver dollars jumped from $14.95 to $17.00 in two weeks.
A snap shot in time.

mikalCoins of the realm attract scrutiny#1536763/24/07; 09:15:38 Presidents mask inflation by controlling data collection - 03/24/2007 - - Bloomberg
As some countries in South America are singled out
for dishonest policies, it underscores inflation's prevalence and "first-world's" bias.

mikal(No Subject)#1536773/24/07; 09:29:14

Fed Changes Tone, Supports Gold and Oil Prices | Walt Breitinger, A.G. Edwards correspondent for the Times | Northwest Indiana Times( - March 24, 2007
mikalIMF's WEO(World Economic Outlook) report due mid-April says dollar must, and will decline...#1536783/24/07; 09:38:26

IMF to urge further depreciation in dollar: paper - Yahoo! News - Reuters - March 24, 2007
German paper on IMF report due in a few weeks.

mikalAxel Merk places bets on currencies, paper#1536793/24/07; 09:54:02 FUND VIEW - Greenback slide is Merk Fund's safest bet - MSNBC Wire Services - - Reuters - 03/24

Mikal-- Like the IMF and countless other highly paid "professionals" , they endorse gold without once mentioning the feared 'g-word'.
Could it be MY future POG estimates are also too conservative? _od only knows, but opinions welcome! :)

mikal@slingshot#1536803/24/07; 10:00:30

Thanks for the update from 'the field'. Asking my banks for Kemnedy half dollars paid off this week better than most with some silver and silver clad specimens. The remainder- spending money- elicit more awe than the new "presidential dollars' fetching a price at those flea markets.
Chris PowellJapan says it won't diversify reserves out of dollar#1536813/24/07; 10:25:55

By Yoko Nishikawa
Friday, March 23, 2007

TOKYO -- Japan has no plans to divert its foreign currency reserves -- the world's second largest -- out of dollars and will not sell foreign assets to help redeem its government bonds, Finance Minister Koji Omi said on Friday.

It now also expects a higher funding cost for its external reserves due to recent rate hikes by the Bank of Japan after years of enjoying virtually zero costs while earning much higher returns from its mainly dollar-denominated reserve assets.

The currency breakdown of Japan's external reserves is a state secret, but historical data on the country's currency intervention, which has mostly taken the form of dollar buying, suggests most of Tokyo's hefty reserves are in U.S. dollars.

"We do not comment on the composition of currencies in foreign reserves as it may have an unexpected impact on markets, but we have no plan to substantially change the composition," Omi told a parliamentary committee.

Acknowledging that most of Japan's official reserves, which reached a record $905.048 billion in February, are in dollars, Omi also stressed that Japan's reserve portfolio management focuses on ensuring the stability and liquidity of assets while pursuing their profitability under those constraints.

Over the past few years, Japan has diversified the types of dollar-denominated assets in its reserves, shifting to more active management from its traditional buy-and-hold policy.

But it has stressed that it would not shift its reserves into other currencies such as euros, as it knows that even a suggestion of such moves could trigger a sharp dollar selloff, which would not be in Japan's interest.

Japan's reserves ballooned after yen-selling intervention worth a record 20 trillion yen ($169.5 billion) in 2003 and a further 15 trillion yen in the first three months of 2004, when the government fought to prevent a rapid yen rise from aggravating deflation and derailing an export-driven recovery.

Tokyo has not intervened in the market since then, as the world's second-largest economy has been enjoying modest but healthy economic growth and shown signs of breaking free from years of deflation.

Hiroshi Watanabe, vice finance minister for international affairs, told reporters that Japan, unlike China, has no plan at the moment to create a new investment body to more aggressively manage its foreign reserves.

Some lawmakers at the parliament committee suggested that a special account that holds Japan's foreign currency assets acquired through intervention, called the Foreign Exchange Fund Special Account, could be used to help finance Japan's public debt by redeeming government bonds.

But Omi noted intervention has been financed by borrowing yen by selling short-term government paper.

Even if Japan sells dollars for yen in the market in the future, that will be used for paying back three-month finance bills, which the ministry uses to fund its foreign exchange special account.

"Thus, we don't have any plans to sell foreign currencies to redeem government bonds," Omi said.

The forex account paid about 7.56 billion yen in interest in the fiscal year that ended in March 2006, while earning some 3 trillion yen in interest rate income and other investment revenues.

Three-month finance bills yield about 0.58 percent, while three-month U.S. Treasury bills yield 5.05 percent.

Part of those gains are set aside as a cushion for potential losses that could arise from a higher yen and any reversal in U.S.-Japan interest rate differentials, although Watanabe said such a reversal was unlikely in the near future.

A new bill, which was debated in the committee, says the forex account can earmark up to 30 percent of Japan's foreign assets for such purposes, on the view that earmarking such an amount means the health of the special account would not be hurt by its unrealised losses.

Tokyo, meanwhile, expects higher funding costs after the BOJ scrapped its zero interest rate policy last year and has since raised the key overnight call rate target to 0.5 percent.

It now estimates that the special account will need to pay 460.6 billion yen in interest in the current fiscal year ending on March 31 and 1.16 trillion yen in fiscal 2007/08. ($1=117.98 yen)

mikalShort, recent interview is recommended reading#1536823/24/07; 10:30:43 This articulates much of the predicament facing the world and the global economy as it discusses the dollar, the US economy and major struggles over the world's future.
Rep. Ron Paul on War, Peace, and the NewsMedia by Michael Shank, George Mason University

flow5Where's the Blog that has futures traders?#1536833/24/07; 10:59:21

Same ol, same ol. Didn't you see?
USAGOLD / Centennial Precious Metals, Inc.A world of gold at your fingertips...#1536843/24/07; 11:35:11

shop for gold coins
Clink!When is a reserve not a reserve ?#1536853/24/07; 11:45:55

RE: Chris Powell's #153681

So if we read between the lines and put words into Omi-san's mouth, it would appear that he cannot say how many dollars or other currency Japan is holding in reserve, because if he did, those reserves might not be worth what "the market" currently says they are worth. It seems to me that this is the EXACT opposite of what reserves should be - no matter what happens in the market, you should always be able to fall back on your reserves.


Sierra MadreGoldsilverratio: thanks for the good post!#1536863/24/07; 12:09:09

In my opinion, Antal E. Fekete is, at this time, the world's most enlightened economist.

There is QUALITY in what he writes, that you will look for in vain elsewhere. That Quality will stand the test of time. A century from now, his words will ring with truth as clearly as they do today.

And a certain poster here, a newcomer, who writes long, long paragraphs, has disqualified not Fekete, but himself, by refering to Antal E. Fekete's thoughts as "tripe".

Rational criticism is always to be taken into account; insults are unacceptable in civilized discourse.


mikalWhat makes a trend?#1536873/24/07; 13:00:28

The US$ tied a ten year low this week in the broad dollar index. Dan Norcini's charts "part 1":

mikal(No Subject)#1536883/24/07; 13:13:04

Frames #'s 10, 12 and 13 have particularly important charts and comments by Dan Norcini:

mikalThere IS a Part 2#1536893/24/07; 13:18:39

My last post is on part 2, a 2nd pdf, not the same as the first.
melda laureFeteke's History Lesson#1536903/24/07; 13:26:08

Whether the real bills doctrine is a "good idea" and whether or not they are "self liquidating" is a matter of some debate among Dr Feteke's detractors.

I haven't seen anyone ably refute these points. What is clear is that his researches are based on historical practices: there WAS a bills market, there WAS a mideveal market clearinghouse. The question is did these mechanisms constitute coercive central banking, and how (if ever) could these practices take over from the current regime of monetary totalitarianism?

At present (and even under a free-gold system) real goods mature into more fiat. It is not a case of gold debts maturing into gold, but of debt holders repudiating paper (which has ever been the means of proving papers worth- absent it and one cannot be certain).

Simply, somebody has to plunk down their paycheck and demand gold.

The two systems are not compatible (I suspect) absent some strong market discipline which is anathema to modern banking. Perhaps digital gold currencies may allow this in an international clearing environment... (once the dollar is toast). Clearing is a function the market cannot live without, witness Argentina.

TopazGettin' ready to RUMBLE!#1536913/24/07; 13:47:05

With just 2 days left to Options trade and but 3or4 'till the fun really begins for April, we can almost taste the volitility about to be unleashed in the Gold-pits.
Check out some of these Options numbers ...the 575 call for starters, do the math on THAT!!

I'd reckon if they can mark time on PoG until they clear the Options it then "could" PoG reverts back to the here-and-now (current) and we "should" see a pop of $50 in a couple of days to realign with the (current) droopy Buck.

Ag is not "utterly" done just yet either's looking futile this go-round tho ...there's always May ;-(

Let's watch!

mikalVideo#1536923/24/07; 14:18:58

Wednesday, January 24, 2007
The Secret Government - Bill Moyers
Posted by manystrom

GOLD FINGERBreaking News....#1536933/24/07; 15:20:13

Troops seized by Iranian's? British and now US? I just heard this...GOLD...oh it will JUMP!!


ge@Thoreauly - Orwell, Rifkin and automation#1536943/24/07; 15:55:14

Working like a good detective, let us first look at the clues available to us:

First, a press release from Conference Board:
China Losing More Manufacturing Jobs Than U.S. But Adding Service Jobs at a Rapid Pace (July 8, 2004)

"China is losing more manufacturing jobs than the United States. For the entire economy between 1995 and 2002, China lost 15 million manufacturing jobs, compared with 2 million in the U.S., The Conference Board reports..."

Rifkin writes at Der Spiegel, more bluntly:
The End of Work,1518,368155,00.html

"European politicians often like to blame outsourcing for the disappearance of jobs. But in reality the work isn't going to the Chinese -- it's going to the robots."

Rifkin verifies the information supplied by Conference Board:

"A lot of politicians in Europe and America say, gee, the jobs are going to China -- if only we could get the manufacturing jobs back, we would have jobs. What they don't know is that China has eliminated 15 percent of all its factory workers in seven years."

As a side note, he interestingly relates the abolishment of slavery to the invention of steam engine. Frankly, this thought had never occurred to me, until I read him:

"The last great structural shift in labor occurred at the beginning of the industrial revolution. We ended slave labor and that was a great structural shift. For 10,000 years people held each other as slaves. From an economic point of view, it became cheaper to feed coal to the steam engine than to feed the mouth of a slave."

All right where do we go from here? Rifkin writes; "The new high- tech revolutions of the 21st century end mass wage labor -- meaning the cheapest worker in the world is more expensive than the intelligent technology coming online to replace them."

How shall the new society be formed?

"Worldwide unemployment is now at the highest level since the great depression of the 1930s. The number of people underemployed or without work is rising sharply as millions of new entrants into the workforce find themselves victims of an extraordinary high-technology revolution. Sophisticated computers, robotics, telecommunications, and other cutting-edge technologies are fast replacing human beings in virtually every sector and industry - from manufacturing, retail, and financial services, to transportation, agriculture, and government."

"Many jobs are never coming back. Blue collar workers, secretaries, receptionists, clerical workers, sales clerks, bank tellers, telephone operators, librarians, wholesalers, and middle managers are just a few of the many occupations destined for virtual extinction. While some new jobs are being created, they are, for the most part, low paying and generally temporary employment. More than fifteen percent of the American people are currently living below the poverty line."

"The world, says Rifkin, is fast polarizing into two potentially irreconcilable forces: on one side, an information elite that controls and manages the high-tech global economy; and on the other, the growing numbers of permanently displaced workers, who have few prospects and little hope for meaningful employment in an increasingly automated world."

"Rifkin suggests that we move beyond the delusion of retraining for nonexistent jobs. He urges us to begin to ponder the unthinkable - to prepare ourselves and our institutions for a world that is phasing out mass employment in the production and marketing of goods and services. Redefining the role of the individual in a near workerless society is likely to be the single most pressing issue in the decades to come."

"Rifkin says we should look toward a new, post- market era. Fresh alternatives to formal work will need to be devised. New approaches to providing income and purchasing power will have to be implemented. Greater reliance will need to be placed on the emerging "third sector" to aid in the restoration of communities and the building of a sustainable culture."

Here I would emphasize the term "information elite vs. permanently displaced workers". Ok, now enters Orwell, that enigmatic writer. Within his book titled 1984, there is another book titled "THE THEORY AND PRACTICE OF OLIGARCHICAL COLLECTIVISM" by Emmanuel Goldstein.

"In earlier ages, class distinctions had been not only inevitable but desirable. Inequality was the price of civilization. With the development of machine production, however, the case was altered. Even if it was still necessary for human beings to do different kinds of work, it was no longer necessary for them to live at different social or economic levels. Therefore, from the point of view of the new groups who were on the point of seizing power, human equality was no longer an ideal to be striven after, but a danger to be averted."

Now, the question is, could the fiat money be a scheme designed to preserve the (no longer needed) steep hierarchy of the existing societal order?

Toolie"Chinese automation"#1536953/24/07; 16:37:19

If what Rifkin writes is correct, why not American robots?
Why do we raze our factories and build new ones in China?
What are the cost advantages to building a highly automated Chinese factory?

Before the Big three automakers moved most of their tooling supply sourcing (including "end of arm" tooling, as in robotic "end of arm" tooling), the assembly machinery that we put into developing countries made greater use of human labor than what is common here in the states. The term "chinese automation" meant replacing a machine with human labor. We've all seen those videos of an automated "body in white" welding line (where automotive shells of the car is index into particular stations, and an army of robots send sparks flying on each side of the assembly line). In China, Mexico, Brazil those robots are human beings operating weld guns, the transfer of the body between stations is human powered.

Even the slightest expense into providing for the safety of the operator is laughed at, as "there is a line at the factory door of people waiting to get a job there".

Must be booming days for tooling/automation manufactures huh? – not.

So now I ask myself; what is the purpose of advancing this bogus study?
Who does Rifkin hope to convince, and of what?
It takes little imagination.

Sierra Madrege: that message of Rifkin's appears pretty dismal...#1536963/24/07; 16:47:13

No wonder economics was called "the dismal science".

The worry is about machines and technology taking over production and creating a mass of workers who, at any price, are too expensive; or at any rate, a second choice after machines.

Well, if that were so, then - as I see it - the only solution would be to reduce the human population drastically. No useful employment for masses of millions? Then they should not be walking upon the surface of this planet. Any scheme to keep them alive, living off of nothing they have earned, would not be viable - however much the idea might appear charitable and humane. Drastic birth control would be in order.

But, happily I don't think that we need to worry too much about that surplus of humans, at least not yet.

For this reason: that ARTIFICIALLY LOW INTEREST RATES around the world have made it possible to misdirect investment into robot machinery, which displaces human labor.

When the grand correction comes, which we are all waiting for, the scarcity of real Capital will become quite clear and thus, interest rates will rise to ration Capital to the most urgent uses. Building robots will not be one of them!

High Tech requires massive Capital investment. We have a "High Tech Era" NOT BY COINCIDENCE, with a paper money era which makes investors feel wealthier than they are and which also makes consumers act as if they are wealthier than they are.

Again, the world's monetary system, in which "payment" consists in tendering papers called dollars, euros, pounds, yen, yuan, etc. has induced mass delusion in the Chinese markets, for instance. The owners of masses of numerical units of dollars - actually nothing in themselves - feel quite rich and are splurging wildly.

Witness the building spree in Shanghai, for instance - the Chinese are going crazy with so many dollar digits in their accounts; they are crazed by this imaginary wealth and are acting like crazy people - building huge outlandish office buildings and immense robot factories and probably, letting their own unemployed face starvation.

But ask yourself: digits in a dollar account, digits in nine figures if you will - are these DIGITS Capital?

No, they are certainly NOT Capital. The owners under the paper dollar spell, think they are Capitalists and very wealthy. But, digits are intangible, they are nothing. Capital is always TANGIBLE, it is another name for tools.

Thus, these owners of these huge numerical quantities of imaginary Capital are splurging on the use of their digits and building factories whose true cost is unknown to them. They think they are acting wisely; actually they are lost, their financial compass is sending them to their eventual doom by providing mistaken information.

So, the nature of the international monetary system is producing enormous distortions in the structure of investment.

When the big correction comes, as it must, there will be Hell to Pay in China! And everywhere else, as well.

Gather your gold, day by day, while you can. The paper money madness will collapse one fine day and you must be prepared to face a great upheaval in our Western Way of Life.



Paper Avalanche@ mikal - Re: Kennedy Halves#1536973/24/07; 16:52:59

How many halves do you normally have to get from the bank before you find a silver one? I may be interested in taking up this hobby as well.


TopazOutsourcing to China.#1536983/24/07; 17:16:45

On of the never mentioned but highly relevant aspects of the China embrace by multi-national corps in manufacturing is the contempt China has both philosophically and personally for Patent/Copyrighting on production of all stripes.

It's just as much a tactical ploy IMO on the part of the Global operators to embrace the Chinese ethos so as to maintain control of their particular sphere of influence, as it is to seek to lower costs via cheaper labour.

Believe you me, if my Copyrighted/Patented turf was to be threatened by lassez-faire Chinese production techniques, I'd be inclined quick-smart to move my robots to China.

mikal@Paper Avalanche#1536993/24/07; 18:48:30

Re: Kennedy halves #'s? You need ask for only a very few considering your likelihood of success.
In my town the big banks nearly always have some loose pieces or a roll or two at minimum, between all tellers. Request if the other tellers have them or if you can order them. Search through them and keep in mind that your success rate will probably(mine has) be affected by how diligently you spend and spread the copper-clads into interested hands and if you divulge your source(s)
(This is usually unsolicited and boring trivia.).
My avg. 'haul' is a few 40% pieces and one 90% per couple rolls, partly due to my 'missionary' work. :)

ToolieHeads, I win. Tails, you lose#1537003/24/07; 19:01:12

More on moving production to China.
GM vs. Chery
FWIW, I see any automation in China, beyond what is required to add quality, as offering a poor return on investment. Whether "intellectual property rights" are respected or not.

Isn't IP (intellectual property) just another method of producing "wealth" from thin air? Secure a decree from a government that X is IP and you secure an income stream indefinitely.
We've seen that movie before. It's currently playing at the comex.
Don't be fooled by imitations, stick with the Real McCoy (hint: It's shiny, yellow and you can't see through it).

mikal(No Subject)#1537013/24/07; 20:31:52

Technology, climate change spark race to claim Arctic resources by Doug Mellgren, Associated Press - Hammerfest, Norway - March 24, 2007
All the fuss over resources, the claims, the counterclaims, the shows of force with many 'allies' even squaring off against each other! And this is just one region of the globe. I'll take 'global cooling' over warming any day.

melda laure"I bid 1,000,000 quatloos for the barbarians"#1537023/24/07; 21:22:51

Rifkin may be a bit confused. The whole point of accumulating capital is to reduce the need for work. An end to drudgery is the final end product of capitalism, universal leisure its final product.

Exactly who is going to buy all those products if there are no employees with wages? Who will defend these elitists from a chinese industrial powerhouse? It conjours up images of John Christopher's "No blade of Grass" and other similar works.

In fact it is many years since the technology to do this was available. So far it has yet to take place. It takes a special kind of anthropologist to capably study the tribe of TPTB. (Few anthropologists have the required understanding of economics, gold, or physics, let alone exopolitics).

melda laureDr Kurt agrees.#1537033/24/07; 21:46:21

In regards to the "end of work" here is an interesting essay:

With an annual current account deficit of more than $800 billion, the U.S. economy is definitely a big loser in foreign trade. To offset this loss of domestic spending and income, alternative additional demand creation is needed. Essentially, all job losses are in high-wage manufacturing, and most gains are in low-wage services. In essence, the U.S. economy is restructuring downward, while the Chinese economy is restructuring upward.

Considering that Chinese wages are just a fraction of U.S. or European wages, IT APPEARS ABSURD that the Chinese authorities deem it necessary to additionally subsidize their booming exports by a grossly undervalued currency, held down by pegging the yuan to the dollar.

So sirs Toolie and SM, it appears that Mr Richebacher agrees with you.

mikal"An acceleration of the buildup"#1537043/24/07; 21:55:54

Global Boom in Coal Power and Emissions | | Mark Clayton - March 22, 2007
Pollution and climate considerations aside, the impact on economics and geopolitics will needlessly complicate matters unless simple, straightforward solutions and resolutions get priority.
At the same time, opportunities include new technologies, new ideas and entirely new markets also unfolding at a rapidly accelerating clip.
And lastly, the manic development of coal plants reflects the same global growth that is consuming finite resources and life sustainers such as (rare + precious + base) metals, oil, land, O2 & H2O supplies.

Topaz@ Toolies link.#1537053/24/07; 22:14:26

Despite affected OS parties having local affiliates, it appears BOTH will struggle to get a positive outcome ...Lord help those "without" a local presence eh?

Japan went this rout eventually fine-tuning the product to a higher standard than the original "mark".

What seems clear looking forward is that ultimately China R and D will stumble upon and develop those many previously discovered advances in Science/Technology that have been squirrelled away by "western" interests on the basis of protecting Patented albeit inferior products ...Can that time be far away?

GoldiloxAdvanced technologies#1537063/25/07; 03:14:03

@ Topaz,

At some point, a lot of "advanced technologies" that have only been available to black ops and the military will find implementations in the commercial world . . . probably just in time to "save us" from oil depletion.

The "patents" will all be mysteriously transfered from public ownership to private political insiders, as TPTB will not let "untaxable" energy infrastructure proliferate.

Notice how quickly some enterprising legislators introduced an "energy surcharge" in an effort to keep self-generating households and businesses paying taxes on their own electricity.

TopazMany happy returns EU Guys ...turning 50 today.#1537073/25/07; 03:35:45

Looking forward to the Berlin Declaration to change the course of mans existence for the better ...not!

Would make for a nice change though. With Germany at the helm and a known recalcitrance in selling off their Gold, it would be nice of them to let slip a Golden directive eh?

TopazFor those who think...#1537083/25/07; 03:43:58

...this Euro thingie is nought but a flash in the Pan, this Wiki primer might be a good place to start.
TopazG'lox.#1537093/25/07; 04:38:13

The Energy "issue" becomes more clouded by the day mate. I'm of the opinion that "western" interests have in fact admitted defeat in controlling Oil as of fairly recently and have refocused on "noocular".

The resident neocon knee-puppet in this neck of the woods ie: Oz PM Howard, has turned a distinct Yellow (not OUR yellow;-) of late with "glowing" (pun intended) endorsement of Uranium mining in Aust. The immediate and enthusiastic support from his State counterpart the QLD Premier, albeit from the opposite side of the political devide, just goes to show how political philosophy is the first skittle to fall when Pigs and troughs become one.

I'm thinking we're going to hear a lot more on "Peak Oil and Global Warming" (two theories neither of which imo stand up to scrutiny) to aid and abet a nuclear biased future all under the watchful and fully controlled management of the "west".

Those polluting, planet-warming terrists had better look out as we go clean and glow green.

Kiwi EnvoyAmerican oil#1537103/25/07; 05:14:44

TOPAZ...nice read thanks.

I've been duped like many others but now my eyes are starting to open. All of the oil in the world precluding oil priced in US dollars belongs to the US. I know that any country that imports oil from US controled nations like Iraq are required to get their mits on US dollars to pay for it...soo all oil sucked and pumped from the ground and sold in US dollars belongs to the US.

It is just so easy with the US reserve currency as numero uno, but now Iran and the US are itching for a scrap bigtime, with Iran banning the US dollar for oil transactions this last week, it is when and not if, the scrap happens.

IMO I reckon this will be the final coffin nail for Bush and his Neocon buddies. I live in Australia and have watched John Howard's approval ratings fall off the cliff. These blokes just don't learn from history. This is the end times for Anglo Saxons running around with pointy sticks for a long time to come.

Anyway, to gold, it will be interesting to see what strength is there when the market opens tomorrow, there was a decent dip last Friday. If the dip buying pops the POG back over $660 the I'm guessing that the Asians are buying into the whole reserve currency is dead thing.

Kiwi Envoy

AdvocatusThe energy issue#1537113/25/07; 09:10:59


Clouded indeed. But there are a number of technologies on the horizon that promise cheap and plentiful energy. There are a number of companies scaling up production of cheap solar. In particular the thin-film CIGS semiconductor deposited on flexible steel foil cells appear promising. Robust enough to be used as roofing material.

The main impediment to solar energy or electric vehicles is the lack of cheap or light electrical energy storage. But recently, a game-changing breakthrough has surfaced: see the link above. And it is ready for production.

The above relies on well-established physics. However there are also schemes based on anomalous physical phenomena, at least one of which is very well corroborated by experiment. It is probably not a coincidence that multiple new energy technologies are popping up now that the petrodollar recycling system has eroded...

mikal(No Subject)#1537123/25/07; 10:23:56 Dollar's Weakness Goes To Perception - New York Post Online Edition | John Crudele | Mar 25. 07
Short question and answer article where one segment is about the $.

Chris PowellVenezuela would shift oil trade away from U.S. and toward China#1537133/25/07; 10:42:41

By Christian Oliver
Saturday, March 24, 2007

CARACAS -- Venezuela said on Saturday it was working on a raft of oil deals with China, giving impetus to President Hugo Chavez's attempts to break his country's dependence on oil exports to the United States.

The China National Petroleum Corp. will look to develop heavy crude oil production in the Orinoco Belt and cooperate with Venezuela in building three refineries in China and a "super-fleet" of crude tankers, the Information Ministry said.

"The United States as a power is on the way down; China is on the way up. China is the market of the future," Chavez was quoted as saying by an Information Ministry statement after meeting CNPC President Jiang Jiemin in Caracas.

China's economic expansion has turned it into the world's second-biggest oil consumer. OPEC member Venezuela was the fifth-biggest oil exporter to the United States in January. Analysts reckon it pumps about 2.7 million barrels per day.

Chavez has ambitious plans to lift oil exports to China to lessen its dependence on its arch-foe the United States, saying it hopes to send 1 million barrels per day to China by 2012.

This optimistic target follows an earlier goal of more than tripling oil exports to China of 160,000 bpd by 2009.

The Information Ministry said CNPC would sign on Monday a preliminary deal to take a 40 percent stake in various Venezuelan heavy crude projects.

CNPC is already working in the Junin 4 block but Chavez said the Chinese oil giant wanted to expand its Orinoco operations with "billions of dollars" of investment.

Chavez is pushing ahead with a nationalization of Venezuela's oil industry, stripping major U.S. companies such as Exxon Mobil Corp., ConocoPhillips, and Chevron Corp. of their majority stakes in heavy crude projects.

While sidelining such majors, Chavez is seeking to do more business with China, Russia, and Iran, part of forming what he describes as a multipolar alliance against the United States.

He said the three proposed refineries in China would process 800,000 barrels per day of Venezuelan crude. The proposed new tanker fleet would not just run China-Venezuela routes but also operate in the Caribbean and take shipments to Africa, Chavez said.

Although Venezuela has signed many memorandums of understanding on commercial cooperation with countries in the developing world, many of the proposals have been very slow to turn into anything concrete.

In a sign that Venezuela's ties to China hinge on politics as well as commerce, Li Changchun, who sits of the Chinese Communist Party's omnipotent nine-member Politburo Standing Committee, will visit Venezuela next week.

ThoreaulyWhence the dollar and gold#1537143/25/07; 12:20:10

Odd that almost no one cared to weigh in on my question about where the dollar and gold are ultimately headed.

Me, I'm with Jim Puplava (see link; 3rd hour) that we're heading for the amero (he calls it the amigo) as Peak Oil and Peak Credit arrive in the next few years and gold goes to the moon. And why gold would ever return to earth is beyond me.

Also interesting that in Puplava's 2nd hour interview about the new book "Peak Oil Prep," the author says that people consider moving to Central America, as this is something I'm considering myself.

The exodus of wealthy Americans is already underway, after all -- -- and with 78 million boomers starting to retire in less than ten months, one can expect the exodus to become a stampede, the question being how long an increasingly desperate US government will allow it to continue.

GoldiloxBiofuel demand makes food expensive#1537153/25/07; 12:58:09


The corn trading pit of the Chicago Board of Trade is an extraordinary place.

People yell orders and give frantic hand signals to seal their bargains.

The traders wear garish jackets, so that someone across the floor will know who he or she is dealing with.

The latest prices of consignments of corn for future delivery are displayed on giant electronic boards along the walls.

And, although the price fluctuates minute by minute, over the last year wholesale corn prices have roughly doubled.

A fifth for ethanol

The reason for the surging price is increasing demand from refineries that are buying corn - or maize as it is sometimes called - to turn it into ethanol.

The ethanol is then blended with conventional fuels for use in ordinary cars.

"We are using 20% of our corn for ethanol," says Roy Huckabay, executive vice president of the Linn Group, which advises commodity investors.

"When the energy markets went bananas over the last year, the value of corn as an energy source sky-rocketed."

Lucrative work

The US Government is promoting the use of ethanol with subsidies.

At the coffee-shop people were talking about doctors quitting and taking up farming
Sam Martin, farmer

Quick guide: biofuels

And President George W Bush has set ambitious targets for increasing the use of bio-fuels in future.

Ethanol produces lower greenhouse gas emissions than conventional fossil fuels.

But many observers think that the big attraction of bio-fuels for the Bush administration is that they will reduce America's dependence on imported oil.

The policy is also making some American farmers very happy.

Sam Martin manages 19,000 acres of land, mainly in Illinois.

He has always used some of the land to grow corn, but is now adding to the area that will be seeded with corn this spring.

"2007 should be a wonderful year," he says with an optimism uncharacteristic of the often hard-pressed farming community.

"At the coffee-shop people were talking about doctors quitting and taking up farming."

Cheap food no more

But the impact of soaring corn prices on consumers is likely to be less beneficial.

Corn is used directly by the food industry in things like corn flakes.

It is also widely used for feeding animals like pigs and chickens.

And food companies are warning that high corn prices will feed through to everyone's grocery bills.

In Mexico, there have been street demonstrations about the rising cost of tortillas, which are made from corn.

And rising food costs are unlikely to be the only impact of biofuel refineries buying into the corn market.

In places like Illinois, the price of agricultural land has started to rise.

That will eventually feed into the cost of other agricultural commodities.

Sam Martin puts it succinctly.

"I think that cheap food is history," he says.

GoldiloxGold to touch record levels, says CPM MD#1537163/25/07; 18:33:42


MUMBAI: Gold is on track to set record levels, "probably this year, possibly next," according to Jeffrey Christian, MD of the global bullion markets research and consultancy outfit, CPM Group.

Prices would mainly be driven by investment demand. "The price of gold will range anywhere between $590 and $690 per ounce, averaging at $640-650 levels this year," said Mr Christian, who is in Mumbai to release the CPM gold year book, brought out in partnership with MCX.

He explained that the average price in 1980, when gold had hit record levels was $612 per ounce, and in 2006, the average price was $606. In the first two weeks of March the average price has been high at $650, hinting that this could well mean that gold is still on the upward course.

"Prices could subside in the following year, but at a new level, in order for the bull run to sustain. This is the third bull run since world war II, and has so far been the longest," Mr Christian said.

He further added that CPM projects that that there could be a consolidation period for the next two years, keeping in mind the economic environment. "If the strong real growth and industrial development continues in the next five years, it would be good for commodities in general," he said.

He pointed out that the risk premium built into the gold price is not going to reduce any time soon. Even though he projects a lower price for gold in 2008-2009, he said it would not be risk-free. The volatility in gold price has also risen, and investment demand for the metal is very high.

In the current bull run for the yellow metal, which began in 2001, the investment demand has been tremendous. In the last five years, global investment demand has been close to 241 million ounces, of which India accounts for almost 20%, Mr Christian said.


While the media is noticing the effects of currency buggering and rampant monetary inflation, few recognize the cause, and attribute it to "investing".

Gold is up in early Asian trading, again knocking on the "platform" door.

The HoopleGoldilox, re: CPM/Jeff Christian#1537173/25/07; 19:16:44

Jeff Christian is a master of disinformation. He omits the small detail that $606 in 1980 dollars would be closer to $1,500 in todays sorry FRN's. This is no way near a record high and he knows it. He comes out sounding bullish yet spends the article basically scaring you out of investing in the shiny, much like JPM and G-S. Predicting an average $640-$650 this year? It's almost $10 above that right now, that's a decline from where we are. A 2 year consolidation period? Now he wants us to believe a bad economy will be BAD for gold. Christian has been almost dead last for the last 7 years in the annual POG price forecast competition so I can only assume he has once again low-balled it by $100-$200.
Sundeck@Advocatus msg#: 153711 - Energy storage technology#1537183/25/07; 20:12:06

Interesting link to innovative capacitor technology, which may greatly assist the energy crisis if it proves to be manufacturable in large quantities and overcomes all the other concerns alluded to in the article...

Of course, energy storage is one thing and energy sourcing is another.

At the moment there is great resistance from the dominant incumbents (oil and coal and gas) to have any of their profit-making patch taken over by upstarts with bright ideas, promising technologies and big plans. The lobbying by the dominant incumbents goes to the very top of the political hierarchy in many countries (after all, oil is still the biggest game in town); deciding questions like whether to wage war to corner the oil market and preserve dollar hegemony (US example), down to just inhibiting support for innovation and alternative energy solutions (Australian case).

Coupled with this is the sheer necessity to "ride the development tiger" until it tires (China case). China, having started its industrialisation/modernisation, now has to find energy in whatever form is available to gulp down ...almost irrespective of the consequences. The US and other industrialised countries too must meet the energy demands placed upon them by the cultural/social expectations of their (clamouringly selfish??) populations.

The interplay between growing world (human) population, cultural and social expectations in these globalised societies, the inevitability of "peak oil" and the inexorably growing, but initially miniscule, contribution from "new energy" minnows, makes for a heady mix in today's world. This mix, as it unfolds, will decide things like the price of a barrel of crude in "invarient" currency (i.e. gold), the lifespan of the US-dollar, the dominance of nations and the ultimate future of humans as a viable species in the short-term (next several millenia) and the long-term (next few million years).

You can be sure of one thing however... Gold will be there in the end with its lustre intact...



Chris PowellFed contrives a clamor that it is too tough on inflation#1537193/25/07; 20:38:05

Miskin Fuels Inflation Target Controversy

By Krishna Guha
Financial Times, London
via Yahoo News
Sunday, March 25, 2007

WASHINGTON -- The Federal Reserve would have to think twice before trying to push inflation below 2 percent, governor Frederic Mishkin has warned, in an explosive speech that is likely to unleash a fierce debate as to what the US central bank's inflation objective is and should be.

The speech challenges the market's belief that the Fed sets policy with the intention of returning inflation to a "comfort zone" of 1-2 percent as measured by the core personal consumption expenditure (PCE) deflator.

It raises the possibility that some members of the interest rate-setting Federal Open Market Committee could be willing to settle for bringing core PCE -- which is currently running at an annual rate of 2.25 percent -- down to about 2 percent.

Mr Mishkin suggested it should not be too difficult to get inflation back to that level, given the pull of entrenched inflation expectations.

His remarks -- in a speech to the San Francisco Fed -- could trigger a sharp response from Fed hawks committed to driving inflation below 2 percent.

Financial markets are likely to interpret the speech as further evidence that the Fed is stepping away from a singleminded focus on inflation and opening the door to interest rate cuts, though the message was more complex than this.

Mr Mishkin did not expressly endorse the idea that 2 percent inflation would be acceptable.

What he did say was that it would be much easier to get back to 2 percent than to go much below that.

Further, is it unlikely that his view represents a consensus at the Fed. The FOMC -- made up of the Washington-based Fed governors and presidents of the regional Fed banks -- does not have an agreed inflation objective.

Individual forecasts by members of the FOMC suggest most could live with PCE inflation at or slightly below 2 percent (roughly equivalent to consumer price inflation of 2.5 percent) in the medium term.

However, many members are also publicly committed to the 1-2 percent "comfort zone."

Some regional Fed presidents favour the low end of that range, which -- given measurement error -- might be close to true price stability.

Last year Jeff Lacker, the president of the Richmond Fed, voted against keeping interest rates on hold and in favour of rate increases precisely because he believed inflation expectations had to be hammered lower to achieve a rate of inflation he could be comfortable with.

The confusion over what the Fed is trying to achieve injects uncertainty into the market, which cannot be sure how the US central bank will respond to economic data.

This reinforces the case for an explicit inflation target. Mr Mishkin -- a champion of inflation-targeting -- knows this, and may have deliberately set out to force the debate on this issue forward.

"I think that we can be reasonably optimistic that core PCE inflation will gradually drift down from its latest 12-month reading of 2.25 percent," the Fed governor said.

"I am less optimistic about the prospects for core PCE inflation to move much below 2 percent in the absence of a determined effort by monetary policy."

This, he said, was because people seemed to expect inflation of about 2 percent. This would help the Fed reduce inflation from 2.25 percent to 2 percent, but hinder any effort to go lower.

Mr Mishkin warned that the cost in terms of unemployment and lost output of driving inflation expectations down could be very high, because of inflation no longer responded quickly to changes in unemployment.

This implies that it would only be worth trying to drive inflation from, say, 2 percent to 1.5 percent if there were big additional benefits.

GoldiloxEnergy Sourcing or Storage#1537203/25/07; 22:32:42

@ Sundeck,

Since energy can neither be created nor destroyed, storage is really the name of the game. Currently, energy is "stored" in fuels, but development of better storage technologies will give rise to more diverse methods of capture and utililization.

The greatest hindrence to using more direct electrical technologies and abondoning the inefficient and poisonous hydrocarbon chain has been the primitive state of battery technologies. Maybe someday soon, we'll catch up to the 3000-4000 year-old Sumerian clay batteries that keep being stolen and re-hidden everytime someone invades the ME.

Every oopart (out-of-place artifact) that suggests anything other than a linear progression from "creation" to the current state seems to find "private homes" with the help of complicit armies and private "contractors".

There is a lot of political "energy" invested in keeping the world believing that the ancients were "prophets", rather than "reporters" of cyclic social and solar system events. That should not be surprising, since the Roman Church is the largest private landowner on the planet. Their appeal to the masses, like that of the Islamists and other religious heirarchies, depends entirely on "belief" in their interpretations of antiquity.

GoldiloxEnergy and gold#1537213/25/07; 22:48:25

While I recognize the tangential nature of our Sunday energy discussions, they bear an uncanny similarity to the "barbarous relic" excuses coming from the same puppet masters.

If no one challenges the nature of energy sources, society will accept what is handed to it by TPTB without question. The same is true of "money" and "value". It has value by "proclamation", as does the beauty of the Emperor's clothes.

How many of the participants in sub-prime lending thought nothing could alter the geometric rise of real estate prices. After all, "they ain't makin' any more dirt!"

Manipulation, paid analysts, government statistics, "owned reporters" and other forms of misinformation have become so pervasive that we no longer even call them lies or falsehoods. We have accepted them as "politics" with implied immunity.

Sundeck@Goldilox msg#: 153720 - Energy understandings, ancient and modern#1537223/25/07; 23:41:15

Alas, Sir Goldilox,

I hope you acknowledge that "the inefficient and poisonous hydrocarbon chain" as you put it, has been the power-provider for our modern societies and, in particular, our modern understanding of matters physical, from cellestial mechanics to quantum phenomena. The explosion in human 'development' has been made possible by the rapid utilisation of carbon fuels laid down over millions of years. It is still by far the most important power source available to us. We in the western world would be a sorry bunch indeed if it were suddenly turned off. I would hesitate to deride it and its significance.

The 'discharge of this fossil-fuel capacitor', so to speak, is substantial, and not without serious consequences...both in the context of global change to the biosphere and in the context of the present strictures of the built-environment; which we are now forced to inhabit and to which we have been lead via the convenience of drawing our power from this 'fossil-fuel capacitor'.


With regard to the concept of energy and energy-technologies through the ages...

Understandings of batteries and other things physical, including "cyclic social and solar system events" (whatever you have in mind) in todays scientific formalisms is, without question, far, far more detailed and sophisticated than anything available to the ancients. To suggest otherwise, except in very rare cases indeed, is fanciful.

That is not to say that modern historians, 'digging' in the past are not frequently surprised by the level of sophistication reached by 'the ancients'...such as the 'Baghdad battery', to which I think you refer, or the Antikythera mechanism (see link), to name a few examples.

However, if you are suggesting that the technological knowledge represented by these artifacts is superior to that of the present era and, somehow or for some reason, has been suppressed and made unavailable to modern enquiry through the intervention of "complicit armies and private "contractors"", then that too, I believe, is fanciful.


This discussion, however, already stretches the limits permitted by our gracious host and there is little doubt that the interplay of religion and societal development over the centuries (to which you allude) falls well beyond the limits...



TopazBerlin Declaration?#1537233/26/07; 01:46:55

I am at a loss to explain the lack of coverage provided with this declaration. It was supposed to be rel