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ARCHIVED DISCUSSION FROM 10/12/2000
All times are U.S. Mountain Time

(Yesterday's Discussion.)

Cavan Man (10/12/00; 23:56:49MT - usagold.com msg#: 38924)
@Farfel
I know you don't read other's commentary because you've said so explicitly but just in case you've changed your mind...

I don't care if you're a Jew, Christian or Muslim.
I don't care if you are a goldheart or not.
I don't care if you went to harvard or yale.
I certainly don't care if you are a successful Hollywood vendor or not (I think Hwood s%$#*)!

I DO care if you don't post your comments here. I, for one, am very interested in your thoughts. Know thyself!

Golden Truth (10/12/00; 23:30:14MT - usagold.com msg#: 38923)
GOLD down already?
As predicted Gold is now down 10cents? I guess everyone that bought today is selling tonight?
I just don't think so, I say it's time to break out the GUNS and start a WAR and shoot the S.O.B's who are keeping gold down. You know who you are and soon we will to!!!!!!!
Keep up your little games for now, for your time is growing short.

jayzee (10/12/00; 23:20:26MT - usagold.com msg#: 38922)
Paper IOU's for gold
Watch for the BB's to sell unlimited amounts of paper certificates (IOU Gold)to drive down the POG. I am sure that they are happy to see a small rally so that they can sell a lot of paper for say - $275, then continue selling until the price drops to $270 or less. Then the investors bail out, giving the BB's a profit in addition to the profit they are making on leasing gold from the central banks.
The only way investors can beat this manipulation is to get a safe deposit box (or other safe storage), and buy only coins or bars.

Mr Gresham (10/12/00; 22:56:49MT - usagold.com msg#: 38921)
On Market Manipulations and Moral Hazard
http://www.prudentbear.com/international.htm
Lots here.


Peter Asher (10/12/00; 22:34:30MT - usagold.com msg#: 38920)
SteveH and Town Crier

Re Steve's >>>how much does gold go up in price per ounce for every dollar rise in the price of crude?<<<

Today, Gold was up $5.80 and Crude $2.75 therefore under the influence of a month long crude crises and a week long war coming to a head today Gold moves $2.00 per dollar of crude price rise. If crude breaks $40, then the fear of the effects that will create would probably see Gold @Over $300. So another $4.00 on crude might move Gold another $24.00 say, that would be 5:1.

There is no rule or ‘lock' that "makes Gold trade at a specific multiple and there are two reasons for this.

1) ME nations converting dollars to Gold will only be doing that out of "Discretionary income," Much of what they receive goes in one bank window and out the other. After all, everyone needs food, clothing and fighter-bombers just to survive!

2) Any Gold-for- Oil ratios considered to be ideal will be irrelevant in any volatile Gold market that has major global factors in play.

My personal opinion of the Gold/Oil phenomena is that it is only a historical statistic and forecasting any future occurrence by that history is pure numerology.

Golden Truth (10/12/00; 22:21:54MT - usagold.com msg#: 38919)
gold up? Ho-Hum!
They are already pounding it down tonight. I'll bet by morning it will be down, and then sold down all day long.
Why would this time be any different than the last two years. I bought physical at $290.00/oz and i still can't even break even??? FARFEL i agree with you 100% Gold is being held down, it's so Goddam obvious it hurts! P.S i Love your posts man, they are great! Keep it up.

When the NUKES start flying over the Middle East Gold should rise $15-$20/oz. That rally?? would last about one week. Just enough time to sell???
G.T







Marius (10/12/00; 22:05:06MT - usagold.com msg#: 38918)
Someone pinch me!
Wow! Oil is through the roof, gold shows signs of waking up, the Middle East is about to erupt, AND FARFEL'S BACK!!!
I'm going to have to put on a Sam Kinison tape just to throttle back for sleep--maybe his rant on the 100 days war.
Oh, OHHHHHH!!!

M

JLV (10/12/00; 21:56:39MT - usagold.com msg#: 38917)
Wasn't it Another
that said Oil, the Dollar and Gold would all go up together?

From Europe's perspective that's been happening for a year.

auspec (10/12/00; 21:52:52MT - usagold.com msg#: 38916)
The Thinking Midas Mulligan
Hello soldier,
Can see you're getting quite a rise out of the USA GOLD troops, very unlike you. With enough persuasion you will be able to convince all to THINK as you do, soon. Have you gotten used to posting anonymously yet? Did you see the movie- An Officer & a gentleman?
Regards.

TheStranger (10/12/00; 21:50:58MT - usagold.com msg#: 38915)
Midas
Midas, dear fellow, you are forgetting. Only some investors sell when the market goes down. Most just sit in anguish and watch their net worth vanish into thin air.

TheStranger (10/12/00; 21:42:02MT - usagold.com msg#: 38914)
Speaking of the Middle East on "Money Line" This Evening...
Zbigniew Brzenzski said, "We are on the brink of a very major crisis."

Midas Mulligan (10/12/00; 21:37:13MT - usagold.com msg#: 38913)
I got issues with all many of yall
Yall keep on saying that investors are seeing their money "go up in smoke" etc...when the markets fall but it aint true. They are only selling and turning frozen liquidity into cash holdings. Cash holdings are not smoke but a source of purchasing power for goods and services. Finally people are going to spend and live instead of save in preparation for death. "Carpe Diem!"

Midas Mulligan (10/12/00; 21:26:40MT - usagold.com msg#: 38912)
Response to Farfel and prediction
There is no anti-establishment conspiracy against Gold, it only appears that way. In reality no one understands it's value except the rare conceptualizing person, like an IFR pilot, with an eagle eye. All others see is what, like a VFR pilot, they perceive ("perception is reality") and what they perceive is something which has steadily fallen in price for the last 20 years, something which does not pay interest, and something which wastes an opportunity for capital gains in paper asset investments. Gold producers only know how to mine the metal, and sell short only to raise cash needed to operate.
For the last 18 years we've been in a downward spiral of falling interest rates, falling inflation, and a falling gold price resulting in soaring stock and bond prices. But now the spiral has been reversed upward as interest rates, inflation, and the price of gold are soaring and the prices of stocks and bonds are falling. This reversal however, should take less than a year to unwind as opposed to the 18 years it took to wind up, and will be like a volcano eruption or a space shuttle Atlantis takeoff. In the next year control of the money supply will simply shift from those who know gold because they know how to think to those who don't.

SteveH (10/12/00; 21:26:04MT - usagold.com msg#: 38911)
TC
Thanks.

So, $639.72 is the absolute +-(au) value of gold at the current US$ price of oil. Or, perhaps we can use this as a lampost:

$ OIL in +-AU (absolute value)
$5.00 $88.87
$10.00 $177.73
$15.00 $266.60
$20.00 $355.46
$25.00 $444.33
$30.00 $533.19
$35.00 $622.06
$40.00 $710.92
$45.00 $799.79
$50.00 $888.65
$60.00 $1,066.38
$70.00 $1,244.11
$80.00 $1,421.84
$90.00 $1,599.57
$100.00 $1,777.30
$150.00 $2,665.95
$200.00 $3,554.60
$300.00 $5,331.90
$400.00 $7,109.20
$500.00 $8,886.50
$1,000.00 $17,773.00
$2,000.00 $35,546.00

This table represents the 30 year relations of gold to oil as presented by RossL and discussed by Hill Billy Mitchell. In 1996 the traditional relationship of gold to oil changed. You can see this in the current price of oil at $36 and the actual price of gold at $275.00, whereas it should be at $639 or so, had the relationship held since 1996.


REVELATION (10/12/00; 21:19:04MT - usagold.com msg#: 38910)
FARFEL "Patience is a virtue"
I thought you knew !

All heavy weight bull markets that a worth investing
in take forever to develop. When gold reaches it's
climactic high evaluations, it will be trading for several
thousand dollars an ounce. By 2003, I expect this to be
the case. If it was legal I would stake my life on it.
With my life savings on gold maybe that's good enough.
So my point is making 10 fold on your money was never
easy in a few short years. It's extremely rare, if not
unheard of for these kinds of returns in such a short period
of time. If you are not in, you won't make any money.
Forget about the tech boom and the returns investors
had or didn't have. Most, if not all, will never live to
see their money because it's already up in smoke.
The fire is still burning and will continue to burn
until these people are broke. Gold on the other
hand will never burn and has stood the test of
time. Gold is as solid as GOLD it's just this generation
has taken longer to wise up. With a shortage of
energy and inflation rearing it's ugly head, the public
still doesn't get it. But they will, and by then gold will
be up several hundred dollars, if not thousands. Then
gold will be ready to collapse, just as they start buying.
These are the same suckers in the stock market
now, not in 82. when the bull began. The public
has completely sold out gold, and I'm a major buyer.
WHEN WILL YOU GET THE MESSAGE ??????
Answer: Like everyone else, after it's already gone
up. More people wait and see, but most all of them
will never get in. Only when it's time to sell. The record
speaks for itself " Most investors lose money, buy
at the top and sell out at the bottom". It's all about
patience. Have a good night and I always enjoy
your commentary. You are an extremely bright person
and there is no reason why you can't enjoy this once
in a lifetime experience in one of the greatest gold bull
markets in history. FACT: THERE IS NOTHING LIKE
"GOLD FEVER".


TheStranger (10/12/00; 21:12:24MT - usagold.com msg#: 38909)
And Another Thing
Goldman's chirpy Abby Joseph Cohen and Morgan Stanley's consistently sanguine internet analyst, Mary Meeker were both dropped from their number one rankings by Institutional Investor Magazine, yesterday.

Say goodbye to an era, folks.


Peter Asher (10/12/00; 21:11:47MT - usagold.com msg#: 38908)
Giovanni Dioro (10/12/00; 14:02:00MT - usagold.com msg#: 38876)

You said >>>>>When buying shares from another does not add to net savings
Mr. Asher, ----Savings generally refer to income that is saved by lodging it into a bank which in turn loans the money out for capital formation which in turn produces more income.<<<<<

Which seemed to be in response to my -- "Unless in cash or Gold/Silver, ‘Savings' are really funds ‘Lent' to the bank and carrying an obligation to be returned on demand or at a specified time." — So, I am confused. Did you mean to address that comment to Midas M.??

Now, in regard to your >>>When you buy shares in a company, someone else sells you those shares. So for you, you are considered to be saving whereas for the seller, he is dissaving. But this is a wash with a net-saving of Zero. The exception is if you are talking of a new share issuance or some sort of venture capital project.<<<<

To repeat from msg#: 38824 "That is not ‘Saving', That is ‘Spending'! The money is spent on acquiring shares of corporations. There is no obligation to those shareholders to give them back a single dime of that money they have parted with. They have an asset that they ‘Hope' to sell to someone else for more then they paid for it."

When you say "You are considered to be saving", tell me, by whom? I see that the stock purchasers consider themselves to be saving, but they are not. Their money is GONE! Re-the stock seller, he is not "dissaving" He is acquiring cash!

He might save it or spend it, invest it or lend it: but if back into stock, as cash that will end it!



TownCrier (10/12/00; 21:09:25MT - usagold.com msg#: 38907)
Sir SteveH ... the multiplier you're looking for is 17.773
Every dollar rise to crude in your hypothesized scenario would translate into a $17.77 rise in gold, were the relationship you've expressed to be put into effect. Similarly, under such a scheme, the POG could at any given time be quoted by multiplying the total crude price by this multiplier.

TheStranger (10/12/00; 21:03:58MT - usagold.com msg#: 38906)
Heard On The Street
I excerpt what's below from the Heard on the Street column in today's Wall Street Journal. There is quite a bit more, too much to post here, I am afraid. But this gives you the gist of it. Once again, things discussed here at the Forum months ago only now enter the public conciousness.

USAGOLD, WHERE TOMORROW'S NEWS IS OPEN FOR DISCUSSION TODAY!

Plunge in Tech Shares Hurts
Earnings From Portfolio Sales
By GREG IP and CASSELL BRYAN-LOW
Staff Reporters of THE WALL STREET JOURNAL


Intel may be the world's best-known seller of microprocessors, but some of its smartest sales this year have been of stocks, not chips.

In February, it filed to sell 250,000 shares of Red Hat Software at $63.87 each, to rake in $16 million. A little later, it filed to sell more than 30 million shares of Micron Technology. At prices averaging more than $70 a share, the sales brought in more than $2 billion, helping propel Intel's "investment and other income" in the second quarter to a staggering $2.3 billion, compared with the $2.4 billion it made from operations.

It will be an awfully tough performance to repeat. Red Hat stock has since fallen 80% and Micron about 50%, along with a broad plunge in technology shares (including Intel's). For Intel and other companies with big portfolios of investments in other concerns, the handsome profits that came from selling those stakes are going to be much slimmer in coming quarters, and the narrower gains run the risk of further undermining investors' faith in tech shares.

Coupled with that are growing concerns that some technology companies may have trouble collecting on loans they made to customers to buy their products, a concern heightened by Lucent Technologies' disclosure late Tuesday that it would take a hit on such loans.

Making money through portfolio investments was easy until this year. Companies ranging from Intel, Microsoft and Cisco Systems to General Electric and Chase Manhattan Bank made many such investments at rock-bottom prices before companies went public, and were able to sell at handsome mark-ups during the mania that took the Nasdaq Composite over the 5000 level earlier this year. While many of the stocks are still above what the companies paid for them even after the Nasdaq's 37% decline from its March peak, it will be much harder for Intel and the other investors to book the handsome profits they once did.

Intel is probably the most prominent example. It owns stakes in 450 companies, primarily through its Intel Capital arm, a spokeswoman says. The portfolio's value stood at $7.5 billion July 1 compared with $10.8 billion April 1, and with the Nasdaq's 20% decline since then, that value has almost certainly dropped further.

"What we are seeing now is the risk associated with that strategy," said Drew Peck, an analyst at S.G. Cowen. "When stocks were benefiting from the irrational exuberance, Intel took that into effect and managed to fill in holes in its earnings. ... Investors are discovering those were ephemeral at best. Now you're going to see the other side of the same coin. Just when they need to augment their earnings they are going to discover that they're no longer there."...


SteveH (10/12/00; 21:01:54MT - usagold.com msg#: 38905)
Correct me if I am wrong...
I'm getting too tired to figure this out, but any math whiz out their caring to take this on. If 1.75 grams of gold = 1 barrel of crude oil, how much does gold go up in price per ounce for every dollar rise in the price of crude? Any takers? What is the price of gold corrected to the above ratio of gold to oil?

Farfel (10/12/00; 21:01:11MT - usagold.com msg#: 38904)
@Goodnight GE
From Canuck:

Farfel,

Your banishment from G-E was not caused by the defense of which you took; it was from the filthy verbal
'chicken dare' offense you directed towards Dr. Vronsky's website. Why don't you go back and look at your
post and envision it from a third party standpoint? There is three sides to every
story, and in this case it's yours, the other poster and the truth.
---

Tell me, sir, what was "filthy" about my offense? What foul language did I use? What was "chicken dare" about it?

Filthy in whose eyes? I guess in your eyes, and if you determine that what I wrote is "filthy," then you must certainly be a hyper-sensitive prude.

I find it very odd that, as somebody who DONATED several essays/speeches for publication at GE at the persistent request of the website leader, I must turn on my computer to discover I am tossed off GE without so much as a word of personal explanation written my way by the illustrious Dr. V. I am repelled by the rudeness of the expulsion, I thought the man had, for lack of a better word, class.

Yet somehow, he sees fit to allow postings by a fellow who goes by the handle of ADOLPH HITLER, and that is OK. Old Adolph can post at GE until the cows come home, but Farfel gets the old heave-ho for daring to ask hard questions of a gold industry hell bent on self-destruction.

Very well, I am happy to have nothing to do with GE, and happy to have nothing to do with you.

Thanks

F*



auspec (10/12/00; 20:34:45MT - usagold.com msg#: 38903)
Farfel- Been Mad
Greetings fellow mad man. You may have to eventually start your own site! Lots of small investors are and have been upset for years {and tears}, yet it needs to be focused anger with a purpose. Properly applied pressure can be quite effective as we need to be ready to jump down the throats of anti-gold actions of the anti-gold establishment, especially the producers that are supposedly accountable to shareholders. It's time to name the names, call the hedge funds - hedge funds, demand support for GATA, expose those that decline to support GATA, promote those that support GATA, and generally WAKE UP & ACTIVATE!
Overly hedged companies have taken some lumps that shows the pressure can achieve results. If we have to, the producers can be loaned some cajones {cash or physical only} and be forced to come to the plate.
You have more courage than I do as have been unable to bring myself to add up how much I've flushed in these markets. It just makes me more determined. Looking forward to your regular posts!

Canuck (10/12/00; 20:22:48MT - usagold.com msg#: 38902)
USS COLE
Just heard on CNBC; 6 dead, 11 missing, 35 injured many critically.

Intelligence busy to find who is responsible. The 'small boat' with 2 men hit the ship where the lower deck mess hall is driving up to the top deck.

Stranger/Black Blade,

Tomorrow, 8:30am will define gold's rise today; I am afraid to be hopeful.

Farfel,

Your banishment from G-E was not caused by the defense of which you took; it was from the filthy verbal 'chicken dare' offense you directed towards Dr. Vronsky's website. Why don't you go back and look at your post and envision it from a third party standpoint? There is three sides to every
story, and in this case it's yours, the other poster and the truth.

Chris Powell (10/12/00; 20:13:42MT - usagold.com msg#: 38901)
English translation of German TV interview on gold price manipulation
http://www.egroups.com/message/gata/563
George Soros, please call your office....

To subscribe to GATA's dispatches
by email and get them immediately so
you don't have to go look for them,
send an email to:

gata-subscribe@eGroups.com




Journeyman (10/12/00; 20:01:07MT - usagold.com msg#: 38900)
The First Casualty @ORO, Chrusos, Java Man, ALL

I have no direct ax to grind -- I'm neither Arab nor Israelie --
and so far only anti semitic in that I heartily disapprove of
foreign aid to Israel, or for that matter, anyone else. But when
I perceive bias, deception, and mis-direction, it really ticks me
off.

As observed in 1917 by Senator Hiram Johnson, "The first casualty
when war comes is truth."

A few examples might suffice. As observed by several Palastinian
spokesmen when asked by CNN talking heads what Arafat would do to
end the violence, they correctly observed that the violence was
being carried out in Palastinian territory by armed Israelie
soldiers against Palastinian civilians, and that the request to
end the violence should be addressed to the Israelie leaders.
They continued that Palastinians weren't rioting in Israel or in
Israelie cities, nor occupying them with armed Palastinian
soldiers, nor bombing Israelie civilians from Apache gun ships.

Prof. Ashwary (sp.?) further observed that anyone, Arab, Jew or
Christian is free to _visit_ the temple mount at any time, but
Sharon was it? came with 200 armed soldiers with another 3000
waiting outside. "That's not a visit," she observed, "It's an
armed incursion." This interpretation, and that it was a
deliberate instigation because of internal Israelie political
factors was supported by many analyists.

Reports that armed Israelie fundamentalist "vigilantes" are
running Palastinians out of their houses has received scant
coverage, as has the fact that the Israelies bombed the radio and
TV stations. Given the habit of Israel to bulldoze Palastinian
homes, often with no other provication than that some settlers
want to live there and the Palastinians haven't kept the paper-
work up to date, the vigilante story rings true.

It has been reported, twice now that I've been able to document,
that the two Israelie soldiers killed by the mob were captured in
an area completely policed by Palestinian police. The Israelie
soldiers didn't just stumble blindly into this area. They were
dressed in civilian garb and armed. This is the signature of
Israelie commando special ops units that infiltrate behind
civilian demonstrations and, in the chaos, assasinate key
demonstrators. Not to knock the Israelies; all governments
engage in similarly henious operations (Waco, Ruby Ridge, etc.)

As far as manufacturing martyrs, the Palastinian martyr-makers
can retire early -- the Israelie troops, possibly including the
two just mentioned, are doing their work for them. The Israelies
have created, at the last count I had, well over eighty. (The
count was 8 Israelies and 92 Palastinians dead.) Or did the
Palestinians perhaps kill all 92 of their own themselves in hopes
of gaining world opinion for their cause?

If Israelie spokes people could manage it, they'd be hyping just
this explanation. I watched in fascination during the Gulf
Massacre as the true meaning of chutzpah was demonstrated. The
apex was when Israel demanded monetary compensation from the U.S.
because their fighters, not properly equipped electronically to
avoid "friendly fire," could not participate in the action
against Iraq.

That is, the Israelies demanded to be paid for the privilige of
being defended free by American lives and at the expense of
American taxpayers. It was during this conflict, during which I
taped and monitored hundreds of hours of TV news coverage
(including footage of Israelie spokesman -- official and in deep
cover in American media,) that it became clear to me the Israelie
machine had integrated news control into their operational
package much better than had even the U.S. establishment.

It's clear from the questions that American media asks, how they
ask them, what they choose to cover and what they don't -- and
the slant -- that there is a definite anti-Palastinian, pro
Israelie media bias, official or not. Israelie spokesmen,
obviously having studied the "talking points," emphasise how
terrible it was that the two Israelie soldiers were killed. And
it was -- if they weren't on a mission of asassination. But as
one Palastinian spokesman managed to get in, refering to the 92
to 8 kill record, "Is an Israelie life worth more than a
Palastinian life?"

Again, "The first casualty when war comes is truth." I'm quite
sure the Palastinians will lie too - - - in some of the rare
instances when they get a chance to be heard at all. There are
few Palastinians in the U.S. media establishment, etc., but there
are plenty of Jewish persuasion -- Ralph Beglighter, Wolf
Blitzer, etc. -- and Mad Albright recently became "naturalized."

So I think I'm safe in saying the _most_ "first casualties" will
come from the Israelie-American axis.

Regards,
Journeyman

P.S. Java Man, the show where George Will made his trout analogy was ABC
THIS WEEK. I often disagree with Krauthammer, but rarely with
ORO or George Will. None the less, sometimes I do.


lamprey_65 (10/12/00; 19:51:54MT - usagold.com msg#: 38899)
Bob Brinker Still Bearish on Gold
http://www.bobbrinker.com/summaries/102000.asp
For those who may not know of Bob, he has quite a following and is one of the few market commentators I truly respect.
He advised his listeners to bail in January and also was able to make a nice trade on the June-August Nasdaq bounce.
He is looking for a long, painful bear market in stocks.

HOWEVER,

His expertise is the equity markets, not commodities. I've noticed that very, very few people are knowledgeable in both areas. The provided link is to last week's summaries -- they are worth a listen...including the one on gold.

A hint...same old arguments, but he has no ax to grind -- just doesn't know this arcane sector, imo.

Also, by being bearish on gold for the past 18 years, he's missed several very important rallies.

I told a friend yesterday that it would be like the Nasdaq falling to 1500 (very possible) and then rallying to 2900 within ten years, only to have someone say they are bearish on the market because it was still down from its high of 5000!

R Powell (10/12/00; 19:38:19MT - usagold.com msg#: 38898)
Hello Mr. Farfel

I'm glad to see you still have fire in your gut and spirit in your words. Perhaps long gold while short the S+P might be the ticket now. Welcome back.
Rich

nummus aureus (10/12/00; 19:35:10MT - usagold.com msg#: 38897)
Welcome Home, Sir Farfel.
Ah, Gresham's Law in action. I will ask the armorer to buff the nicks from your blade and shield on the morrow. We will wish to hear more of your golden travels.

lamprey_65 (10/12/00; 19:25:16MT - usagold.com msg#: 38896)
Farfel
Have you ever considered that you may be carrying a little too much baggage to be obective on this sector?

As a fellow banished G-E poster, thought I'd be the one to ask. ;-)

Lamprey

P.S. - Doesn't take much for Vronsky to pull the plug...I didn't last 24 hours, yet I've seen others hang on for weeks after REALLY disrupting his establishment. Kind of a moody fellow.

Galearis (10/12/00; 19:20:24MT - usagold.com msg#: 38895)
@Farfel
WELCOME BACK!
Gold Eagle's loss is surely our gain! Let the spittle fly!

G.

Giovanni Dioro (10/12/00; 19:17:07MT - usagold.com msg#: 38894)
link to previous story
http://www.bloomberg.com/bbn/topworld.html?s=AOeYX0BTvUGhpbGlw
You'd think that if the Phillipines had a sound economy then political scandal wouldn't make that much of a difference. Anyhow their Central Bank raised rates 4 full percentage points to try to stop its currency from falling in value (inflating).

Farfel (10/12/00; 19:12:10MT - usagold.com msg#: 38893)
Banished again!
Well, it looks like I have been banned from my SECOND gold forum, as critical comments I made concerning gold investors recently caused revocation of my posting rights at Gold-Eagle.

Moreover, I was accused of making ad hominem comments aimed at one poster (true!) however my only defence is that they were in response to ad hominem comments directed toward me. If you are going to dish them out, you best be prepared to receive them, and, as someone who lost millions in this gold market ON THE LONG SIDE, I do not appreciate anybody who suggests I ever shorted gold (there are many times I wish I did though).

So, Michael, you get me back by default, and I look forward to the day when you pull the plug on me as well :-).

Unfortunately, I am NOT the old gold cheerleader I used to be because I cannot suffer the endless abuse dished out to gold investors by the gold mining companies themselves. I do not accept the status quo in the gold mining industry, one which decimates and defrauds its shareholders on a daily basis, one which harms the environment at the expense of a higher quality of life, one which promotes gold in public whilst shorting it into the ground behind shareholders' backs.

Finally I cannot suffer the daily abuse that gold investors serve up to each other as they merrily trash each others' gold investments, (thereby providing ample ammunition to the gold shorts), when the real enemy (bullion banks and their overhedged gold producer partners in crime) watches from the sidelines, laughing at the disunity they have sown amongst gold longs. I am sick of the interminable stupid gold debates (numismatic vs. bullion, N. American vs. S. African, paper gold vs. physical gold, etc.).

We are NOT the enemy, the enemy is NOT us! THEY are! STOP
warring with each other over nonsense.

If I am guilty for being hard on goldbugs, well tough!

If I make them mad, great, GET MAD! ,

STOP tolerating this masochistic status quo in the gold business, this "businesss as usual" attitude.

DON'T be satisfied with a lousy 6.00 gain in the gold price today, it is a puny little obscene joke, it is an outrage, given all the upheaval occurring today, the gold price should have jumped 50.00, and the XAU should have climbed at least 20 points.

DEMAND more, ASK for more, RATTLE cages, GO out and GET it!

But the main thing is to create an alliance of perspective because otherwise the united enemy always will defeat you.

Oh, and that is IMHO.

Thanks

F*


Giovanni Dioro (10/12/00; 19:03:10MT - usagold.com msg#: 38892)
Asian Currency Crisis Part II
It's starting again. Phillipines financial system is in trouble in face of govt scandal

"Manila, Oct. 12 (Bloomberg) -- The Philippines raised key interest rates by 4 percentage points, the biggest jump since the Asian financial crisis three years ago, as the peso plunged on a political crisis that threatened to bring down the president...Still, concern about contagion to the rest of the region should be slight as ``concerns stem from an isolated political problem...Making matters worse, the government today cut its growth target for next year and raised its forecast for inflation. At the same time, it acknowledged its budget deficit this year is likely to be about a third larger than the target set for the nation by the International Monetary Fund."

"IMF officials are in Manila this week to review the country's economic performance and are in ``more or less continuous contact'' with Philippine government officials, according to fund spokesman Thomas Dawson."
http://www.bloomberg.com/bbn/topworld.html?s=AOeYX0BTvUGhpbGlw

Midas Mulligan (10/12/00; 18:45:29MT - usagold.com msg#: 38891)
Response to Marketalk
I don't think the talking heads have put one over on anybody. They, like the common sense public that listens to them, simply does not know how to conceptualize, ie. think. No panicky crash just a smooth controlled market deflation landing by master pilot Greenspan.

TheStranger (10/12/00; 18:37:59MT - usagold.com msg#: 38890)
Gold, The One Day Wonder
CNBC reporters repeatedly characterized today's rally in the gold market as a flight to quality, typical of what happens when peace is threatened. One even said that gold is in decline these days and that the activity was, therefore, likely just a one day bounce.

Now, it always strikes me as funny when some naive JOURNALIST steps beyond her purview with such authority to make facile pronouncements about the markets. But surely, anyone who has been around the last fifteen years knows it has been a long time since gold has been used as a refuge from international crises. In fact, the stolid metal has pretty much ignored every international confrontation I can recall, and I am 52 years old.

Call me a cockeyed optimist, but I think something else may have been at work in the gold market today. All of us here at the Forum, have been aware of the great money supply inflation of recent years. All of us knew there was going to be a day of reckoning for the explosion in credit, which, among other extravagances, had put an SUV in nearly every American garage. All of us knew the Dollar was up to it's armpits in gasoline. What we had awaited these many months was a spark, something to set that gasoline off and wake everybody up.

One expert after another has reassured us for the last two years that there was NO INFLATION in the United States. Yes, oil prices were up, but that was surely temporary, and, in any event, oil doesn't really matter like it used to. Well, I think what happened in the oil markets today may have been the spark that made people start to wonder. Maybe all those financial geniuses didn't know what they were talking about after all.

Oh, today was a flight to quality, alright. It was a flight to the real stuff.

MarkeTalk (10/12/00; 18:26:50MT - usagold.com msg#: 38889)
Smash on Wall Street--More to Come
The bears were out in full force today, feasting on many stocks. The bears should have eaten enough for their winter hibernation. What a blood bath, a wholesale rout with the Dow Jones Industrial Average down 375 points on huge volume. For all of you novices out there, this is just phase one! Wait until the DOW drops decisively below 10,000 and then watch the panic set in. That sound you hear coming from down the hall is the sound of your mutual fund managers puking in the bathroom stalls. They will be forced to sell stocks just to meet the redemption notices, as middle class America realizes that it has been had by Wall Street and its spin doctors, CNBC "talking heads" et al. Chart-wise, the DOW could drop to the 7500 area where is was back in 1997/1998. A drop of this magnitude would match the 38% drop so far in the NASDAQ. I expect it to happen sooner than you think. Why? Because there have been hundreds of billions of dollars of market capitalization lost in the past week. Poof! Gone to money heaven. Selling begets more selling like the proverbial snowball rolling down the mountain.

With events in the Middle East spinning out of control, the phones were ringing constantly today. People wanted to do IRA rollovers and partial transfers into gold--just to name a couple--and it is not even the season for IRAs. But it is the season for GOLD! On a different topic: One client suggested the following to me: Isn't it a bit strange that a U.S. warship pulls into a Yemeni port unannounced for a six-hour re-fueling operation and then in that brief time it is attacked? Would it not make more sense that SOMEONE knew in advance it was coming and then prepared the rubber boat with the explosives? Would this not point to an inside job a la Mission Impossible type operatives? It would sure make President Clinton look more presidential and maybe boost Al Gore's ratings. Hmm. Just a thought.

Finally, GOLD jumped $6.00 per ounce on all of the news referred to above. As the saying goes: You ain't seen nothing yet! I fully expect to see days where gold jumps $15-20 in a single session. Tomorrow's PPI is already considered by Wall Street to be a non-event. But tomorrow's figure is ancient history. IF crude stays where it is and even goes higher (which I expect shortly), then next month's PPI and December's PPI will show big inflation even at the core rate. With crumbling stock prices and rising energy prices, smart investor are now turning to gold for safety. Soon the word gold will be on the lips of investors at parties. Now is the time to buy your gold or add to your positions.



Black Blade (10/12/00; 18:26:30MT - usagold.com msg#: 38888)
Gold Up, Oil Up, and Middle-East Powder Keg Explodes!
It is good to see gold perform under these conditions. Gold is thought of as a safe haven when the markets take a dive. There have been unseen powers that have worked to constrain the POG in spite of uncertainty in the markets. Today's $5.80 rise in gold is a start, and gold is up another 60 cents in the Asian markets.

Journeyman: It is quite funny isn't it? Moses takes his flock and bumbles around the desert for 40 years. Next morning he gathers his people and says - "Here it is" Of course he chooses the only place in the Middle-East without any oil. Bummer.

Pheonix: Oil up $2.81. Tonight I heard an oil analyst discuss the end of cheap oil. Damn near fell off the chair. Really think they might be catching on? This morning another one said that he's a buyer at $50.00/bbl. HUH? Not only is he late to the party, he's going to buy high in order to sell higher? I know oil is going much higher, but the drones that watch over this business are definitely not going to be accused of being America's best and brightest. ;-)




Canuck (10/12/00; 18:17:50MT - usagold.com msg#: 38887)
USS COLE
Not much being said about the US destroyer.

This is a very dangerous situation. I believe this part of the Middle East saga will prove to be extremely important.

Four are dead, 12 missing and another 30 injured. This terrorist attack is very, very large. I'm sure US intelligence is aware of those responsible. In a day or two this may become public knowledge; imagine Iraq related?

Mr Gresham (10/12/00; 17:57:27MT - usagold.com msg#: 38886)
Oro #38883
(Just a sneak peak at your first paragraph before a run to catch the Post Office closing:)

For the innumerate (economics- and math-challenged) American consumer of equities, those newspaper ads touting 1-year, 5-year, and 10-year mutual fund returns look pretty much like those funny percentage-thingies the banks advertise in their CD-rate ads, only much higher, don't they? Sheesh!


aunuggets (10/12/00; 17:36:21MT - usagold.com msg#: 38885)
Sir Oro - Re: "Enterprise Value"
Your mention of "Enterprise Value" reminds me of the story of an old man walking along the trail when he happens upon a young lad sitting and gazing off into the trees.

"Whatcha doin' there, sonny ?" the old man asks the lad.

"Oh, just looking at my property" he replies.

"This is all yours ?" asks the old man.

"Yep, all 100 acres of it" continues the lad. "Bought it just last week, and I think it has alot of potential."

"Sorry to burst your bubble, sonny, but this piece of land has no potential at all !" barked the old man.

"Huh ?" responded the youngster, half in surprise and half in anger.....

"Nope..." said the old man. "Only potential 'round here is sitting on his butt 'wishin' ..... !



TheStranger (10/12/00; 17:35:28MT - usagold.com msg#: 38884)
ORO
Re your : " Now, the Fed must decide (once again), whether its policy of market support must be used in order to make good on people's expectations. If they do, the inflation of money supply required will take your breath away."

Is there any doubt THIS Fed will succomb to this temptation? (Or any other Fed for that matter?) Else wise, what's the point of having fiat money?

ORO (10/12/00; 17:17:44MT - usagold.com msg#: 38883)
aunuggets, Giovanni Dioro - stocks as money
What Abbey Joseph Cohen has claimed, and Yardeni confirmed as to the stock market (and the corporate bond market) was that there was an unusual reduction in risk premiums over the last few years. The reason for this was the growth of popular participation in the equity market. The popular view is that this is a money market account with a better interest rate. As such, the "lack of savings" in the US is actually more the function of monetizing stocks in people's minds. Though investors are intellectually prepared for the possibility of loss, they neither think it would hold long term (i.e. over 1 year) so that stocks will recover, nor do they have the emotional experience of stocks falling and not getting up.

The Fed assistance to the markets at all major crashes has created moral hazzard both on the popular level and the commercial level, with derivatives blowups being swept away by recurring flows of Fed liquidity, and even low interest rates. These banks have found the reliable Fed assistance made the issue of equity index puts a profitable endeavor that assisted them in the core business of selling the latest flavor IPO and floating the most absurd of loans into the markets based on "enterprise value" (i.e. the expected market value of the company in the bubbly stock market).

The result has been the effective use of popular investment vehicles in stocks being used by the public as part of their cash balance- my "M9". Executives, who should have known better, borrowed against their stock holdings in order to avoid the sure tax loss with a possible market loss. Since this habit effectively made the stocks into money, it was just a matter of time till those more knowledgeable would catch this crowded trade and shake out its weak players. Now, the Fed must decide (once again), whether its policy of market support must be used in order to make good on people's expectations. If they do, the inflation of money supply required will take your breath away. At 10% annual M3 growth rate it has not brought the decline to a stop. I expect it will continue to expand till the market does respond.






aunuggets (10/12/00; 16:45:19MT - usagold.com msg#: 38882)
Giovanni Dioro (38876)
Good points, Sir ! It is amazing to me how many simply don't understand how much market valuation is based on "fantasy". If a stock in Company-X (for example) rises from $10 per share to $20 per share, there is no increase in "capitalization" for that company unless and until the company holds it's own stock AND sells such stock into the higher market price. In the case of the outstanding stock, only the outstanding share holders actually "profit", and again, ONLY if they sell into the higher price. Of course, splits, new issues, etc. can effect the overall game, but the basics are really quite simple. Rising prices or falling prices matter little until you take advantage of the play to increase your position. Just as with gold, there is no "profit" in holding physical if you consider more gold to be your definition of "profit". Only when you sell do you realize a "profit" (increase in fiat).....in the meantime, 100 ounces remains 100 ounces. But then, isn't that one of the characteristics of "real money".....something that actually EARNS NO INTEREST ? If it is truly "liquid" (readily available for use), it can earn no interest. If it is earning interest, someone other than youself has control of it and it becomes no longer "liquid" to you.

As the late Sam Walton was fond of saying......."It's all just paper". All except the GOLD, that is !

JavaMan (10/12/00; 16:39:28MT - usagold.com msg#: 38881)
Sir Chrusos...

I happened to catch George Will on a Sunday morning TV talk show and, essentially, he supported Krauthammer's assertions regarding Israel going the extra mile for peace.

Thanks for the post...its about time we saw a perspective that shows, more accurately, what is going on in the Middle East.

Oh yeah, he also responded to Paul Begalis (sp?) who was defending Gore's propensity to "exaggerate". George Will stopped him cold and said: "Wait a minute. If I go fishing and catch a fish that is eighteen inches long and claim it was twenty inches long...that's an exaggeration. But if I claim the fish was twenty inches long and I never even went fishing...then that, Sir, is a lie."





Goldsun (10/12/00; 15:58:00MT - usagold.com msg#: 38880)
Prosemitism and Antisemitism
Two sides of the same coin.
I prefer the Philharmonic.
Goldsun

Chrusos (10/12/00; 15:53:59MT - usagold.com msg#: 38879)
Arafats war
One of my favourite columnist's take on mideast "peace" process.

Charles Krauthammer (The Washington Post)
October 7, 2000


Fighting has broken out in the Middle East, we read. This use of passive phrasing, almost universal in media reports on the violence in Israel, is a way of deliberately expressing agnosticism about the cause of the fighting. It is a scandal. It is akin to writing that on Sept. 1, 1939, war "broke out" on the German-Polish frontier.

Few wars break out spontaneously. And certainly not this one. Does anyone believe that Ehud Barak, who went to Camp David and offered the Palestinians peace terms of breathtaking generosity, would be starting a war? Does anyone believe that the most dovish government in Israeli history, feeling itself just inches away from concluding a permanent peace, would initiate gun battles?

The plain fact is that Yasser Arafat, thrown on the diplomatic defensive by rejecting Barak's offer (to the astonishment and dismay of the American mediators), has done what he has always done: resort to violence to regain the initiative and, most important, mint new underage martyrs--on world television--to regain the international sympathy he had forfeited by turning down peace at Camp David.

His pretext was that the Sept. 28 visit to the Temple Mount by Israel's leader of the opposition so offended Islam that the faithful erupted in violence. The audacity of this claim is astonishing. Yes, the Temple Mount is the third-holiest place in Islam. But it happens to be the single most holy place for Jews. Why does the Muslim claim so trump all others that Jews may not set foot on their most sacred site, their Mecca?

The war that followed was as spontaneous as a Havana demonstration. The preacher at the al-Aqsa mosque called at Friday prayers to "eradicate the Jews from Palestine." Official Palestinian television began playing over and over archival footage of the Palestinian intifada of 1987-1993 showing young people out in the streets throwing stones.

In case one still didn't get the message, Voice of Palestine radio began playing patriotic war songs. Arafat then closed the schools and declared a general strike, causing everyone to go out into the street. With Arafat's chief political lieutenant on the West Bank orchestrating the militias, war then "broke out."

The doves are stunned. Avraham Burg, speaker of the Israeli parliament and one of the architects of the Labor government's bend-over-backward peace proposals, writes perplexedly, pathetically: "Do we really understand what is going on? After everything was given, there are still demands on the other side."

"Suddenly we discovered," he continues plaintively, "that what we mean by peace--which is mutual reconciliation--is not being met by the other side."

Suddenly? Where has he been for seven years? Seven years during which Arafat built his "police force" into a 40,000-man army now unleashed on Israel. Seven years during which Arafat repeatedly said that the peace process was one option and that if he did not get everything he wanted there was another. Seven years during which his state-controlled television, radio, newspapers and now children's textbooks inculcated in his people an antisemitism and anti-Zionism so virulent that it has succeeded in producing a new generation bred on reflexive hostility to Israel.

Seven years during which he repeatedly called for "jihad" for Jerusalem. Well, it has now arrived. That is the meaning of the current fighting.

This is, as the Palestinians openly call it, a war for Jerusalem. Not, as the world press has reported endlessly and fatuously, an expression of Palestinian "frustration." Frustration with what? Israeli occupation? It ended years ago; 99 percent of Palestinians live under the rule of Yasser Arafat. Over territory? Barak has conceded virtually the entire West Bank. Over political subordination? Barak offered full recognition of the first independent Palestinian state in history.

The Palestinians are less frustrated than emboldened. Emboldened by an Israeli government so desperate for peace it has given up "everything," as Burg admitted. Emboldened by the fecklessness of Burg and his colleagues, so impervious for so long to empirical evidence of Palestinian implacability that in this moment of supreme crisis they admit openly to disorientation.

Emboldened by an American administration so craven that it refuses to condemn Arafat for cynically starting this war, indeed for repeatedly violating his single obligation under Oslo: the renunciation of violence.

"After everything was given," laments Burg. Yes everything, except one last thing: the Temple Mount. Why, Barak went wobbly even on that. He offered to relinquish sovereignty over Judaism's holiest site and internationalize it under the U.N. Security Council.

Arafat refused. He demands ownership--the audacity is breathtaking--of Judaism's holy of holies. Hence this war.

It is not spontaneous. And it is not without direction. Arafat knows what he wants, and he is prepared to sacrifice as many of his own people as it takes to get it. Preferably on television.




nickel62 (10/12/00; 15:47:38MT - usagold.com msg#: 38878)
Many of the junk bonds have gone "no bid" according to a knowledgable source .
I don't want to over emphasize the importance of the "no bid" situation in the junk market, but it does illustrate that the junk market is currently not liquid and that is generally a crisis situation in many areas of the investment business when you can't sell what you have in order to get money to meet redemptions etc. It is the literal freeze up of that market that means literally that at this moment at least there is no market price at all for certain low quality bonds. Very interesting. It should throw some interesting monkey wrenches into some of those computer dynamic hedging models of the "Masters of the Universe".

ORO (10/12/00; 15:17:24MT - usagold.com msg#: 38877)
Journeyman - Israel and Palestinians
The Israel Lobby has two major components, the largest being the fundumentalist Christian support which is not loud but very effectively catered to on the Republican side and considered by the Democrats as well. The smaller portion, and the louder one, is the Israeli and Jewish lobby that you are referring to.

Despite the political and funding pressure applied on this side, the State Department has had a most anti-Israel approach that started in 1936 with the takeover of oil activity in Saudi by US oil companies. Only after the expropriation of oil fields by the Gulf states in the 50s was the attitude softened slightly and roles reversed with the Soviets (who were Israel supporters before). The unreliability of Arab sentiments was only then considered a problem and Israel was viewed (being a Western democracy) as a counterweight to the Arabian militancy which had finally moved to seeing the US as just another collonist just like the Brits and French (who were anti Arab and actively pro-Israel at the time).

In the US, it had only been in that time that actual anti-semitism had peaked. The Jewish vote came into play as a solidly recognizable and organized block only at the end of the 50s when Jews started voting together with blacks and Catholics to whomever seemed most inclined to help them in their struggle against bigotry.

The Arab belligerency towards the West in general and Israel in particular was very visible in the West, and Israel won much support from both Europe and the US, while the Arab states turned into Soviet clients, while the oil states played the two sides against each other.

Anti-Israel attitudes rebounded in the US State Department and in Europe during the first oil crissis in 1973-4. The Israeli victory in the October war was tempered by US and European pressure not to anihilate the Egyptian and Syrian military forces because of the Saudi and other oil state's threats to stop oil supply to Europe as well as the US, and the US' general insolvency reducing its leverage with both parties. Soviet threats at the time were sufficiently frightening to have the US decide to halt the Israeli advance.

The US State Department has continued its anti-Israel bias despite countless occasions on which Arabs have shown utter enmity to the US. Their stance relative the oil states could be somewhat understood, however, support for the PLO is an utter mystery outside of the fashionable support they have received from the Soviets and their remaining dregs in the socialist and social democratic parties and intelligentsia. It is a fact that PLO and Palestinians have been poison to anyone who embraced them, be it Lebanon which they destroyed completely, or Jordan which responded with a ruthless uprooting of the PLO complete with wide scale massacres, or Kuwait and Saudi, where Palestinian rabble looted and cheered as Kuwait was overtaken and Saudi shook in fear, and now Israel and its suicidal leftist peace movement. Despite this, they have enjoyed support from Western socialists, which I expect will be the next victims.

As far as your arithmatic, reactions from Israel to assistance to Egypt and Saudi/Kuwait were not at all negative, but raised the hope of peace and cooperation with both. On the Palestinian side you can see the reaction to assistance to them as -1 to -2 and assistance to Israel as a -6. Fortunately, the Palestinians, having shot their friends and their feet so many times in the past have nothing to offer anyone but to stop their violence. Though that may seem like something, the violent reaction on their side to what was a minor provocation by Sharon, demonstrates their unreliability and prove Sharon's point that peace with this group is not worth the paper it is written on.

The monetary pressures on the US by Arab oil and Europe (attempting to deliver on old promises to oil) had forced Bush, and then Clinton, to balance the budget and to engage Israel and the Palestinians with a distasteful peace which the Palestinians never wanted at a popular level. The stated position and the popular sentiment of Palestinians has been that they still desire the anihilation of Israel. The peace process was just another step on the way there.

The Palestinian problem is that of the Arabs, and it is a conceptual misunderstanding of the West that is completely inside their heads. Symptomatic of the problem was yesterday's interview with X Israeli PM Netanyahu and with a Palestinian official. The Palestinian response to Netanyahu's words was a dismissal of Netanyahu as a "deposed" leader who is powerless and can be dismissed out of hand. What this demonstrates is the traditional disbelief of Arabs in both the sanctity of contract and the possibility of voluntary cooperation. This has brought them to miss the revolution of private property rights and freedom (all limited, of course) which underlay the economic success of the West and the running of international trade.

Arab oil nations still don't understand that the value of their oil is not physically intrinsic to the oil
but is derived from the great number of consumer items made from it that satisfy consumer wants and needs. If reliable oil supplies are not to be had from Saudi and friends, then producers will do their best to satisfy consumers with energy and chemical precursors other than oil. Once the infrastructure for alternatives is in place, they will lose pricing power for oil forever. Much of the decline in inflation adjusted oil prices since 1980 is attributable to the fall in its relative importance to electric generation, which is now dominated by coal and natural gas. Which, in turn, was a result of the 70s oil crises.



Giovanni Dioro (10/12/00; 14:02:00MT - usagold.com msg#: 38876)
When buying shares from another does not add to net savings
Mr. Asher,

When you buy shares in a company, someone else sells you those shares. So for you, you are considered to be saving whereas for the seller, he is dissaving. But this is a wash with a net-saving of Zero. The exception is if you are talking of a new share issuance or some sort of venture capital project.

Savings generally refer to income that is saved by lodging it into a bank which in turn loans the money out for capital formation which in turn produces more income.

But what is most troubling in america is the massive spending on consumption. Today America piles on debt and consumes like there is no tomorrow. But tomorrow they will have to pay. We know that the trade deficit has risen to extremely dangerous levels, and this will ultimately have a seriously negative effect on the dollar.

Bascom Toadvine (10/12/00; 13:59:57MT - usagold.com msg#: 38875)
Argentino's
Clink, Clink!
aka Henri

The Hoople (10/12/00; 13:53:38MT - usagold.com msg#: 38874)
Peter Asher
Clarifying, on re-fi I meant primarily the 120% equity loans so popular the last several years, they would take excess and remodel (or buy stocks). Those loans are drying up. Your other points are all valid. Nobody prior to Depot ever brought such incredible leverage to this industry. They,along with Lowes, have very little margin for error.Combined they are opening a new store every 48 hrs I believe. When the funds rocket fuel runs out the wheels can come off quickly. Combined with extreme wage pressures and stock options vaporizing it is a very ugly possibility.

Journeyman (10/12/00; 13:45:44MT - usagold.com msg#: 38873)
Murphy's law of politics @Black Blade, ALL

"Yesterday I posted a URL to the USS Liberty Memorial
site. Captain McGonagle was awarded the Congressional
Medal of Honor. Unfortunately it was awarded in secret
and not at the Whitehouse as is customary so as not to
"offend" the Israelis! *What the hell do they got over
us? They don't even have any oil. Should wash our hands
of all of them and let them duke it out - winner takes
all!*" -Black Blade msg#: 38840

Political and disinformation influence is "what the hell they got
over us." Social security may be the "third rail of politics;
touch it and you're dead," but Israel is the OTHER third rail of
politics.

The pro-Israel lobby is well organized and EXTREMELY well
financed. Beleivable rumors have it that at least one Moussad
death squad is active in the U.S. No politician in his right
incumbent mind would ever challenge Israel. As a result, despite
its small size and realative wealth, Israel gets more U.S.
foreign aid than any other country in the world, and if you
question Israel's "right" to this massive foreign aid, ADL, etc.
will officially declare you "anti semitic." At least in part
this explains why, despite "fiscal responsibility" and "budget
cutting" having been the catch phrases of the moment, one of Mr.
Clinton's first official acts as President was to reassure Israel
that it's foreign aid was secure.

Lose - lose:

Research shows that it takes four to five positives to offset one
negative. So the equation is this: Country A and country B are
fighting each other. Country C helps Country A once. This
equals 1 perceived plus point for country C from the viewpoint of
country A - - - but at least 4 negative points _against_ Country
C from the viewpoint of Country B. Net score for busy-body
Country C: +1 -4

Let's assume Country C is attempting to be "even-handed" and so
_also_ aids Country B once to keep things even. Now the equation
for that one aid to Country B: From the viewpoint of Country B,
plus 1; from the viewpoint of Country A, minus 4.

Net result for both acts of aid by busy-body Country C are as
follows: From the viewipoint of Country A; plus 1 and minus 4 =
minus 3. Same applies from viewpoint of Country B.

Thus the composite score of busy-body Country C is minus 3 and
minus 3, a total for Country C of minus 6. At least in times of
conflict, Murphy's Law of politics is no well intentioned act
shall go unpunished.

The lesson is clear: MIND YOUR OWN BUSINESS, or in the words of
G. Washington in his Farwell Address, "avoid foreign
entanglements."

Regards,
Journeyman


Peter Asher (10/12/00; 12:51:30MT - usagold.com msg#: 38872)
Stranger, Hoople


Stranger: Per Hoople's post, Home Depot caters mostly to Do-it-yourselfers. I haven't seen any local indication of a contractor slowdown, either in the coastal market or the Improvenet lead flows from Portland. Two weeks ago, coastal lumber prices were spiking up. My call on home depot is that their DYI customers have maxed out their credit cards. Though their sales gross is up, as Hoople points out, they may be making their volume on the low margin products, I don't believe the re-fi budgets go there. Very little of overall contractor volume goes through Home Depot. Mainly small jobs and they don't have the product line to service the high end.

We got two Improvenet leads for major remodel-expansion plans in the last 24 hours.

TownCrier (10/12/00; 12:44:51MT - usagold.com msg#: 38871)
Sirs Al Fulchino, TheStranger, others...
http://www.usagold.com/onlinestore/special.html
Beleive it or not, there are minimum requirements for withdrawal at the vault where the gold is kept secure by our agents prior to packaging and shipping.

No promises on the outcome of this angle, but we suggest you flex a little muscle and make sure whomever you talk to at Centennial (800)869-5115 is aware that you are a poster. Strings can sometimes be pulled and special arrangements made.

Also, there's no minimum order when done for the selected coins offered through the on-line page.

Knallgold (10/12/00; 12:39:00MT - usagold.com msg#: 38870)
@goldhunter
Sure will take 460.Would be very healthy to my mining shares.If we only could test this discussion soon....
I hope so,putting together FOA "restructuring of Goldmarket in the US" and Don_L.'s cube with the weakening of the 330 and bullish signs into next year.I would expect 350 soon.

But what beyond?I have seen what happened in the Pd market.It did not build up confidence.And Veneroso revised his forecast to 2000$/oz.One should not take this guy lightly.Do you expect Comex still in healthy operation at 2000 POG?

wolavka (10/12/00; 12:36:20MT - usagold.com msg#: 38869)
Ray
Down can't get thru. e mail me midway9@home.com

Peter Asher (10/12/00; 12:32:27MT - usagold.com msg#: 38868)
Midas Mulligan msg#:38854)
Re
>>>>Reply to Giovanni and Asher about Savings comments yesterday When you own stock regardless of how "irrationally exuberant" it's priced you still own a share of the
company and thus are invested in it's physical capital<<<<

Qualitatively correct but, quantitatively, what % of that "irrationally exuberant price" do you suppose represents that "physical capital??

Al Fulchino (10/12/00; 12:12:01MT - usagold.com msg#: 38867)
The Stranger
you said:
I called USAGOLD this morning to see about buying a gold coin as a Christmas present, but I was told they have a ten ounce minimum. Rats. Does anybody know, is that because of delivery costs?


me: My lovely wife would just find nine other people to give gold coins to!


ORO (10/12/00; 12:03:23MT - usagold.com msg#: 38866)
Stocks then bonds then gold
The normal cycle is

stocks up bonds up gold flat

stocks flat bonds up gold down

stocks down bonds up gold down

stocks up/flat bonds down gold up

The relationship has to do with both economic conditions and the monetary policy reactions.

Gold ups are related to expansionary monetary reaction to the decline in stocks and the economic damage associated with this decline. Funds that had moved to bonds would then react with inflationary fears as a result of the monetary injections and would move to gold.



TheStranger (10/12/00; 12:00:26MT - usagold.com msg#: 38865)
The Hoople
Your #38862:
Great Post!


Mr Gresham (10/12/00; 11:04:49MT - usagold.com msg#: 38864)
Procrastination
Of course, my procrastination has served me well, to keep me from buying $30,000 of puts in that time, instead of only $10,000. (I'm just trying to use up my capital loss carryover, honest, officer.)


Mr Gresham (10/12/00; 11:02:53MT - usagold.com msg#: 38863)
Yowza!
Good g-ddam! I'm finally making some money, after YEARS of "rational calmness", on my BEARX. Now buyer's remorse sets in. ("Wish I'd'a bought more.) Don't let this happen to you with you-know-what when you-know-what happens!


The Hoople (10/12/00; 10:43:39MT - usagold.com msg#: 38862)
Re: Home Depot
Home Depot blaming declining lumber prices is a crock. They have always used lumber as a loss leader and it never was a profit center to begin with. They have resorted to the Intel way of explaining away a disaster in earnings. The truth probably lies in customers refinancing going sour, and credit card debt at maximum levels.More ominous is how addicted they are to fund inflows, and how vulnerable they will be to a slowdown. Wickes Lumber's bankruptcy in the 1970's shook down all the major players; their receivables were only a fraction of what vendors float to Depot. don't underestimate this stock as a harbinger of bad things to come on Wall Street. (and main street)

Cavan Man (10/12/00; 10:38:04MT - usagold.com msg#: 38861)
Stranger
Couldn't you use those extra nine coins; even as momentos?
:>)

wolavka (10/12/00; 10:33:15MT - usagold.com msg#: 38860)
uptic is close
massive short covering will hit dec gold @ the magic # 277.40

Phoenix (10/12/00; 10:28:37MT - usagold.com msg#: 38859)
Oil Payment in Euros Heats Up
http://www.slb.com/ba.cfm?baid=1
Oil & Gas News: Top Story
Iraq Threatens to Halt Oil Exports Over UN Money

BAGHDAD, Oct 12 (AFP via energy24.com) - Iraq could suspend oil exports if the United Nations fails to convert to euros billions of Iraqi dollars blocked in special account, according to the deputy governor of the country's central bank.

"Iraq may suspend crude exports if the United Nations refuses to reply favourably to its request to convert into euros its account at the French bank BNP," deputy governor Abdel al-Ilah Boutros told Al-Zawra.

Iraqi Finance Minister Hekmat Ibrahim al-Azzawi announced last month a decision to ditch the dollar in foreign trade transactions.

"The dollar is the currency of an enemy state, and must be abandoned for other currencies, including the euro," Azzawi said.

The central bank announced Sunday it had begun to buy European currencies.

Since December 1996 the United Nations has allowed Iraq to sell oil to pay for imports of food and medicine. Under the decade-old sanctions regime none of the revenue is allowed to pass through Iraqi government hands.

Instead, it is paid into an escrow account at BNP-Paribas, which is paid a fee for operating the account.

My comments: Black Gold leads Gold Gold. It's coming people...even higher oil prices, a reserve currency switch, a hyper-inflated dollar, and a much, much higher gold price.


wolavka (10/12/00; 10:24:54MT - usagold.com msg#: 38858)
reno
check it out , rubber raft?

Phoenix (10/12/00; 10:20:30MT - usagold.com msg#: 38857)
Wall Street Waking Up
Well, I just read my first report from a Wall Street Analyst who actually understands a small measure of the oil business and supply demand issues. In a CIBC report by Rubin dated October 4,2000 called "The Wall," they elaborate on the Hubbert Curve as the primary reason why oil prices will coninue rising next year staying between $30-$40 and probably moving to $50 soon after. The era of cheap oil is over according to them. It's what Black Blade, myself and many others here have been saying.

They also talk about oil production decreasing with time from these giant Middle East deposits, i.e. depletion. ;-) They also predict that demand growth of 1.5%/year (10 year average) will cause us to max out supply in 2 years, or they predict if demand slows (due to high prices) to 0.5%/year that it will take 6 years to max out supply. After that oil prices will reset at their true market value.

A very good report. If you have access to it, it is very informative.

Fly from the Fire,
Phoenix

ORO (10/12/00; 10:15:28MT - usagold.com msg#: 38856)
PPT intervention at 1030
http://biz.yahoo.com/rf/001011/n11404937.html
Rather gross intervention it seems. Someone must be in trouble with puts issued at what appeared to be juicy margins during the selloff in Apr-May. Time to make those puts worthless again.

Note news of Morgan Stanley difficulty with the junk debt they had on their books. Rumors of a bailout.





wolavka (10/12/00; 10:13:39MT - usagold.com msg#: 38855)
Short gold
Clowns @ comex try to hold your shorts tonite, and over the week end.

Midas Mulligan (10/12/00; 10:12:23MT - usagold.com msg#: 38854)
Reply to Giovanni and Asher about Savings comments yesterday
When you own stock regardless of how "irrationally exuberant" it's priced you still own a share of the company and thus are invested in it's physical capital. All this talk about the need to own physical gold is silly because a share in a mining company is backed by the gold reserves in the ground, equipment, etc... and it will rise even higher than the price of gold due to the p.e multiplier effect, by which I mean that the paper asset bubble will switch from non gold stocks to rationally exuberant gold stocks. Contrary to most I see a financial meltdown as a positive liberating occurence like the end of the movie Total Recall or the book Atlas Shrugged, except I expect it (bubble deflation) to be smooth and controlled and not a panic ridden hysterical crisis like has always occured in the past. Greenspan will not let things unravel out of control.

TheStranger (10/12/00; 09:54:42MT - usagold.com msg#: 38853)
Peter Asher and Rats
Peter - This Home Depot story makes me wonder if guys who build decks should be rejoicing over the cheaper materials or worrying about a slowdown. I hope the lower prices are all that's troubling Home Depot, but I doubt it. With consumer debt where it is, you'd think home improvement is in for a skid. I'll bet you have some thoughts on this.

By the way, this was not in the news release, but Morgan Stanley said this morning that Home Depot's margins are also under pressure due to higher wage demands.

*****

I called USAGOLD this morning to see about buying a gold coin as a Christmas present, but I was told they have a ten ounce minimum. Rats. Does anybody know, is that because of delivery costs?

Peter Asher (10/12/00; 09:32:44MT - usagold.com msg#: 38852)
He'll probably say: "Well, oil was cheap that year"

XXX DRUDGE REPORT XXX DEC. 7, 1997 XXX

"The most vulnerable part of the Earth's
environment is the very thin layer of air
clinging near to the surface of the planet, that
we are now so carelessly filling with gaseous
wastes that we are actually altering the
relationship between the Earth and the Sun - by
trapping more solar radiation under this growing
blanket of pollution that envelops the entire
world," Vice President Gore told the U.N. Global
Warming conference of 159 nations this morning
in Koyto, Japan.

In what was one the most dramatic speeches in
recent memory, Gore announced to world leaders:
"Whether we recognize it or not, we are now
engaged in an epic battle to right the balance
of our Earth, and the tide of this battle will
turn on when the majority of people in the world
become sufficiently aroused by shared sense of
urgent danger to join an all-out effort." ----


--- The message is serious. So serious in
fact, the DRUDGE REPORT has calculated that Vice
President Al Gore is burning more than 439,500
pounds of fuel, or 65,600 gallons, at a cost of
more than $131,000 on his 16,000 mile daytrip --
just to deliver the warning!



Peter Asher (10/12/00; 09:23:42MT - usagold.com msg#: 38851)
Say What?? Deflation??
http://news.excite.com/news/ap/001012/10/home-depot?printstory=1
(Now back up 100 pts,looks like record volume. Naz up 20+

NEW YORK (AP) - The Dow Jones
industrial average plunged more
than 300 points in early trading
Thursday as an earnings warning
from home improvement retailer
Home Depot added to fears that the market has yet to bottom out.

ATLANTA (AP) - Shares of Home Depot plunged 26 percent
after the home improvement retailer warned that its third-quarter
and full-year earnings will fall short of expectations, primarily
***because of price deflation*** in lumber and building materials.



Galearis (10/12/00; 08:50:56MT - usagold.com msg#: 38850)
@leSin: silver
A gentle rebuttle
I emphatically do not disaggree with Rhody's analysis of the supply shortage in above ground silver or the ludicrous short position. But it should also be stated that while the shortage undoubtably exists, part of the European bullion availability is a function of form not substance. A major proportion of European silver (some 60% of silver supplies over that of N. American) is in the form of granular silver. This silver would obviously be held in lower esteme than solid bullion.

At least this is my understanding, and the information may, of course, be disinformation from a Cabal spokesperson.

G.

Black Blade (10/12/00; 08:19:49MT - usagold.com msg#: 38849)
Iraq says wants euro oil payments from Nov

By Peg Mackey

LONDON, Oct 12 (Reuters) - OPEC member Iraq wants customers lifting its U.N.-supervised crude oil exports to pay in euros starting in November, an oil official said on Thursday. Baghdad, which accounts for five percent of internationally traded crude, is consulting the United Nations about the possiblility of making the switch from dollar payments, the official added by telephone. "Iraq this month has asked the U.N. to open another separate euro account in addition to the present dollar account," the official contacted in Baghdad said. "From November all letters of credit for the exports must be opened in euros and payment made in euros," the official said.

A Western diplomat said he did not anticipate any objections to the setting up of a euro account for Iraq, whose revenues from an oil-for-food deal with the United Nations are deposited in a dollar U.N. escrow account in a French bank in New York. "If it's just a case of setting up a new account, I don't see why there would be a problem," he said. A major lifter of Iraqi crude oil said the potential euro payment switch "shouldn't create a problem for anyone. They will just have to define the conversion rate." The Iraqi oil official said he knew nothing about any plan to halt oil exports if the United Nations declined to cooperate.

Abdulillah Putrus, deputy governor of the Iraqi Central Bank, was quoted by the weekly al-Zawra as saying Baghdad might halt oil exports unless a bank account holding its U.N.- monitored revenues was changed from dollars into euros. The reported statement runs counter to an announcement by Iraqi Vice-president Taha Yassin Ramadan at an OPEC summit in Caracas on September 28 that Baghdad would not hold back its crude from the world oil market. Asked what would happen if the United Nations declined to arrange euro payments, the Iraqi oil official in Baghdad replied: "This is not my domain."

The official said a clause stipulating payment in euros would be included in sale contracts for November loading crudes. "We are still talking about November prices now. We have not notified our customers about anything directly," he said, adding: "We do not anticipate any problems with our customers paying in euros." "We are talking with the U.N. about this now." U.N. sources said in May that the Banque Nationale de Paris account had a record $7.8 billion from proceeds of Iraqi oil sales under the U.N. humanitarian oil exchange. Iraq exports of 2.2 million barrels per day at current prices earn about $57 million a day. The oil deal allows Iraq to sell oil over a six month period on a renewal basis to buy food, medicine and other humanitarian goods for the Iraqi people reeling under stringent U.N. sanctions imposed for Baghdad's 1990 invasion of Kuwait.

The Iraqi government decided late last month to halt trading with the dollar and replace it with the euro or any other currency. A statement by the Iraqi government after a September 14 cabinet meeting which originated dropping the dollar said the move was to confront the "daily American-Zionist aggression."


Black Blade (10/12/00; 08:18:16MT - usagold.com msg#: 38848)
GOLD $4.10 at $274.10 and NY Crude at #36.15/bbl
http://www.crbindex.com/curquote/crbquote.mhtml
Also NASDAQ just turned negative. The sleepers have awakened!

Black Blade (10/12/00; 08:09:45MT - usagold.com msg#: 38847)
Even Today There are Some Comedians on Wall Street
A petroleum analysts was interviewed on Bloomberg this morning. He said that if oil went to $50.00/bbl, then everyone would have to add oil to their portfolios. This rocket scientist is a bit late to the party as usual.

Cavan Man (10/12/00; 08:05:40MT - usagold.com msg#: 38846)
Dear Canuck:
You asked about gold stocks. I own NEM, HGMCY, and GOLD; all are under water for me. I am hanging in there hoping they recover to my buy levels and then I will sell. Gold stocks carry a lot of potential leverage but they are poor proxies for investment in PM and are terribly volatile. Gold stocks are for gamblers (like me) and professional investors (like Stranger). Gold stocks are a "whore's dream".

I do in fact believe they will all recover to my point. If my gold stocks weeren't well hedged I'd be worried.

Black Blade (10/12/00; 08:03:27MT - usagold.com msg#: 38845)
Petroleum and Gold flying high!
Petroleum up VERY sharply across the board:

Crude Oil 35.45 +2.2 +6.62 %
Unleaded Gasoline 0.976 +0.052 +5.63 %
Heating Oil 1.07 +0.0522 +5.13 %
Natural Gas 5.73 +0.222 +4.03 %

AND GOLD UP +3.20 at $273.20



Black Blade (10/12/00; 07:54:26MT - usagold.com msg#: 38844)
Israeli Helocopters Fire Rockets on Town of Ramallah, West Bank
http://news.bbc.co.uk/hi/english/world/middle_east/newsid_968000/968573.stm
Eye for an Eye, Tooth for a Tooth, ........

wolavka (10/12/00; 07:49:59MT - usagold.com msg#: 38843)
while you watch
middle east blow up, the real bomb is margin.

Can you say MARGIN CALL

Black Blade (10/12/00; 07:30:37MT - usagold.com msg#: 38842)
SPR Bids in Doubt
It looks as if three of the bidders for SPR oil were not able to acquire the necessary "letters of credit" and those bids may be withdrawn, the oil may perhaps be submitted again at a later date. These "players" were unknown by anyone in the petroleum industry. That probably should have been a clue, however, when those in charge of the auction attempted to contact one of the individuals at his home in Harlem - his mom answered. That should of been a red flag, but they have yet to withdraw the bids. Hmmmmmm……….

wolavka (10/12/00; 07:16:37MT - usagold.com msg#: 38841)
Okay I'm ready to go up
buy

Black Blade (10/12/00; 06:43:19MT - usagold.com msg#: 38840)
The Israelis (Alledged Allies) and Now Arab Terrorists
http://www.halcyon.com/jim/ussliberty/
Yesterday I posted a URL to the USS Liberty Memorial site. Captain McGonagle was awarded the Congressional Medal of Honor. Unfortunately it was awarded in secret and not at the Whitehouse as is customary so as not to "offend" the Israelis! What the hell do they got over us? They don't even have any oil. Should wash our hands of all of them and let them duke it out - winner takes all!

DaveC (10/12/00; 06:40:04MT - usagold.com msg#: 38839)
SteveH (10/12/00; 05:01:22MT - usagold.com msg#: 38832)
Most of the Interest Rate Yield Curve is still inverted.

Black Blade (10/12/00; 06:37:16MT - usagold.com msg#: 38838)
More Details on USS Cole Attack!
At least four sailors have been killed in what US officials are describing as a suicide attack on a US Navy destroyer in Yemen. An American spokesman said a small inflatable craft packed with explosives had rammed the destroyer, the USS Cole, in the port of Aden. At least 31 people have been injured. "There's a 20-40 foot hole on the port side on the waterline," said Lieutenant Commander Daren Pelkie from the US Fifth Fleet headquarters in Bahrain. "The flooding has been contained. No fire reported. The ship is listing four degrees to port," he said. There has been no comment from the Yemeni authorities.

Gulf mission

The USS Cole is a Arleigh Burke class destroyer, with a a crew of 350. She was heading to the Gulf to join the US-led maritime interception operations in support of UN sanctions against Iraq. It went through the Suez Canal on 9 October, down the Red Sea and called into Aden for refuelling.


Black Blade (10/12/00; 06:25:52MT - usagold.com msg#: 38837)
SteveH and Petroleum
This attacked turned the Petroleum contracts right around and moving strongly into record territory. The sudden price advance is obviously tied to this suicide attack.
SteveH: Interesting approach. They had to be completely caught flat-footed as there Plananx defense system should have been able drop em like flies. They could of been in port perhaps.

wolavka (10/12/00; 06:23:44MT - usagold.com msg#: 38836)
Taleb on options
" They suck you in and blow you up." okay what else is knew. We knew that in 1984.

SteveH (10/12/00; 06:20:33MT - usagold.com msg#: 38835)
Black Blade
Further info, it was Aegis class destroyer, believe named USS Cole. Four confirmed dead, as many as 30 injured. It was a terrorist attack by a black rubber (Zodiac) boat. It appears that it was a suicide mission. It struck or rammed the stern (rear) of the ship and exploded knocking a 30plus foot in the hull at the waterline, CNN reports.

The Ship was in port in Yeman during a routine fueling stop.

Black Blade (10/12/00; 06:11:27MT - usagold.com msg#: 38834)
US Naval Ship Attacked in Persian Gulf!
Just on the news. A suicide boat rammed a US Naval ship off the coast of Yemen. There was an explosion. Several US servicemen injured and as many as 4 dead. This Middle-East situation is getting out of hand.

LeSin (10/12/00; 05:42:24MT - usagold.com msg#: 38833)
Rhody @ Lease Rates & Silver Shortages
I like the Rhody's Logic & clarity - Thank You - Rhody
Date: Thu Oct 12 2000 07:11
rhody (LEASE RATES: short term lease rates for silver are now) ID#410367:
Copyright © 2000 rhody/Kitco Inc. All rights reserved
as low as rates for gold. This would suggest that there is
scads of silver hanging over the market. Since leases are
a function of paper trades, just the opposite is the case.
Just like the rise of the USD is not a sign of strength, the
drop in the lease rates for gold and silver is not a sign of
excess liquidity. Not any more. What we see here is
a lease market full of fear. Nobody wishes to borrow metal
at 50 year lows for gold and 600 year lows for silver.
So the illusion is created that silver is cheap ( to borrow ) ,
and cheap in the real world. Tell that to the guy in
Germany where banks charge $7.90 for bullion wafers. Tell that
to the investor in Switzerland who can't find silver bullion at
all, at any price, in any bank. The real market price for
bullion is beginning to disconnect from the paper price as
displayed on COMEX, LBMA, and lease markets.
The paper price will continue to decline, and all pm
mines forced to sell at the paper price ( just about all of
them ) will be bankrupted. Got physical? FWIW, Rhody

SteveH (10/12/00; 05:01:22MT - usagold.com msg#: 38832)
Obervations
1. Is it me, or did I not see the inverted yield curve of the 10 and 30 back to normal? Normal being where the 30-year yield is higher than the 10-year.

2. Rise in Platinum's October Margin is significant as this is what TOCOM did when they couldn't deliver on all deliveries. (Thanks Gandalf) Is this stating that Platinum is close to a default? Don't know.

3. S&P, Nasdaq, and Dow futures are being pushed significantly higher today, I believe, in order to prevent, if possible, a fall through the March low that stood at around 3162. Psychologically, falling below this March low would present a moral hazard for the markets as it would be a technical sell signal and indicate lower stops in the near future. So, who is pushing up the futures?




Zenidea (10/12/00; 04:14:30MT - usagold.com msg#: 38831)
How low can the aussie $ go ?
That low it scored a seat on the cabal's board of directors.
and as for the Kiwi $ , thats a basket case ! Men satisfied on the dole , fearing child support , feminist and land rights activists cornering the media at hysterical levels.
But let me say this, please I have dispite what else is said on the international front , if I was some high flying international tycoon and saw the lies the populace has been fed , just on the basis of Integrety alone , Would I blame them for pulling the finger from he dyke ?.

wolavka (10/12/00; 03:37:48MT - usagold.com msg#: 38830)
Does not look good
In 70s' it was Bunker Hunt, now it's hunt for Bunker.

Zenidea (10/12/00; 03:32:30MT - usagold.com msg#: 38829)
(No Subject)

Dollar dangerously close to all time low
From AAP
12oct00

5:31pm (AEDT) RISING oil
prices, ambiguous employment
data and an injured New
Zealand dollar conspired today
to bring the dollar perilously
close to its all-time low.

Early today, the currency
appeared to be holding its own
despite oil-driven falls in the
euro overnight, but its legs
were swept out from under it
just a few hours into the local
session.

"It was $US0.5349 very early
this morning, before 8.30, and
we've been to $US0.5292 on
the downside," said Macquarie
Bank trader Kevin Tuckey.

"It doesn't feel like a spike low
so I guess it can try lower."

Late last week, the dollar
crashed to its record low of
$US0.5280.

At 1700 AEDT today, the
currency was just hanging on,
at $US0.5296/5301, from 0.5335/40 at yesterday's close.

"When you see the all-time low recently and we're now only a few
points away from that," Mr Tuckey said.

The domestic unit stood firm overnight as the euro lost value amid
rising tensions between Israel and the Palestinians, which pushed up
oil prices.

"Overnight we saw the euro go down on oil prices and Middle East
concerns, and everybody has been trading the Aussie on the back of
the euro and the yen," Mr Tuckey said.

"The Aussie fell (in local trade) this morning and then the
employment figures came in."

Total employment fell 30,500 to 9.111 million, seasonally adjusted, in
September, but the Australian Bureau of Statistics found
unemployment had pulled back to 6.3 per cent, from 6.4 in August.

It was the first fall in employment since January and a sharp pullback
from the 24,100 new jobs recorded in August and 75,800 in July.

Few economists had expected a fall at all and none a fall of more
than 20,000 jobs.

A median of economists' forecasts collected by AAP was for 15,000
new jobs in the month, with the most optimistic expectation coming
in at a rise of 70,000.

"The figures didn't really help, but they didn't really hurt either -
employment's gone down but full-time employment's gone up and the
unemployment rate's gone down," said Mr Tuckey.

Further hardship for the dollar came in the form of a failed acquisition
in New Zealand.

"This afternoon when the commerce department in New Zealand
blocked the Shell takeover of Fletcher Challenge Energy, the Kiwi fell
from $US0.4045 to 0.3967, so the Aussie followed that," Mr Tuckey
said.

"The Aussie-Kiwi's gone up but that's why we're currently sitting
around 53 US cents."

At 1700 AEDT, the New Zealand dollar had recovered slightly to
$US0.3988/93.

The dollar closed at 1.3307/36 New Zealand dollars, from 1.3196/224
at the local close yesterday.

It closed at 57.11/19 yen from 57.62/70, 0.6103/08 euro from
0.6113/18 and at 0.3619/25 British pounds from 0.3659/65.

The short-term prognosis for the battling currency is not optimistic.

"I imagine we could have a spurt lower," Mr Tuckey said.

"I think it's now a matter of looking to see what the euro does, so if
the euro goes down to $US0.8580 or something like that then the
Aussie will come off, but if the euro goes up then the Aussie
probably will as well."

Locally, the US dollar closed at 107.83/88 yen from 108.00/05.

At the end of the local session the euro was at $US0.8674/79 from
$US0.8728/33 at yesterday's close and at 93.53/58 yen from
94.27/32.

On the Reserve Bank of Australia's Trade Weighted Index at 1600
AEDT the dollar was at 49.0 points from 49.2 at yesterday's close.

Cage Rattler (10/12/00; 03:23:27MT - usagold.com msg#: 38828)
Oil and Euro
From BBC NEWS - Iraq say they will hold back oil production unless its accounts are converted from USD. into Euros.where in future all payments are to be made in Euros.

wolavka (10/12/00; 00:48:28MT - usagold.com msg#: 38827)
money on the move
watch reallocation of money funds and margin calls, 2001 will be interesting to see where the roi settles.



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