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ARCHIVED DISCUSSION FROM 5/25/2000 All times are U.S. Mountain Time (Yesterday's Discussion.) ax (5/25/2000; 23:41:33MT - usagold.com msg#: 31320) Shifty Yes, but I have done it over and over like about 25 times. SHIFTY (5/25/2000; 23:36:40MT - usagold.com msg#: 31319) ax You may be spelling your name or password wrong. I have done that before. SHIFTY (5/25/2000; 23:22:26MT - usagold.com msg#: 31318) The Stranger The Stranger: I also appreciate your friendship and I agree about this not being the time or place for such topics. Please forgive me , just having a bad day.$hifty Hill Billy Mitchell (5/25/2000; 23:21:21MT - usagold.com msg#: 31317) beesting (5/25/2000; 22:37:54MT - usagold.com msg#: 31312) Sir BeestingRe: your rule # 1 as follows:Rule # 1 NEVER,NEVER spend more than you make on a monthly basis(except for real estate purchases)This is also my Rule # 1 with one difference. I do not add the parenthetical exception. I am not sure I even understand the exception. Do you mean that if you cannot earn $100,000 in one month that you would not buy a new over-the-road tractor to make a living? Do you lease the tractor month-to-month in order to make a living and still abide by your self-imposed rule # 1? Or do you consider the purchase of an over-the-road tractor to be an investment rather than "spending"?My self-imposed rule works like this. I never spend more than I earn on a month to month basis unless the expenditure is funded with prior savings, ie. I would not buy real estate with funds obtained from a loan; however I would buy real estate or a vehicle or income producing assets in excess of one month's earnings if and only if I had the cash to do so from prior savings. I know that this would seem be a bit too extreme but it works for me. I also have religious reasons for not borrowing which I would not pretend to be absolute for anyone but myself.hbm totalamateur (5/25/2000; 23:13:52MT - usagold.com msg#: 31316) Just a dream?! "THE MONEY EXPLODES!"I HAD THIS DREAM just now, and it scared me so it woke me up! We were at the grocer's trying to buy a can of soup, and you asked the man, "How much is this?" He said, "That'll be three pounds." I said "three pounds!--For a can of soup!" He said "That's the price today, and you better take it or leave it, Buddy! For there's no telling what it's going to be tomorrow!" So we paid him three pounds and walked out stunned!I DON'T KNOW WHAT HAPPENED IN BETWEEN, but we must have decided we should leave the country because of the monetary situation. A can of soup for three pounds! So the next thing I knew we were at the railway station trying to buy a ticket, and I was asking him for a return ticket, a round-trip ticket."I'M SORRY, WE'RE ONLY SELLING ONE-WAY TICKETS," he said. "We have no idea what the return fare would be later. I wouldn't care if you were returning this weekend, I wouldn't sell you a return ticket because I have no idea what the price will be by then. All we're selling is one-way tickets, and we have no idea what the price will be on returns. We'll sell you a one-way ticket at what it is today, and that's it! And that's for your fare today only. It's got to be used today. We've no idea what the prices are going to be tomorrow!"SO EVIDENTLY WE DECIDED TO GO TO THE BANK and take our money out-what little we had--for due to this skyrocketing inflation its value was being lost so rapidly, and we were apparently going to leave the country.ON THE WAY TO THE BANK we stopped to watch this train go by. It was leaving the station and picking up speed as it left, at first starting to roll real slowly and then faster and faster, till soon it was just flying! I didn't understand at first what that meant, but I realise now I was thinking, "It's symbolic of how once the thing starts rolling, the inflation really gets going, it really flies!"THE POUND'S LOST 10% OF ITS VALUE IN THE PAST WEEK! But it wasn't even in the headlines! Isn't that peculiar? It's down to the lowest it's ever been, now, and the dollar is up the highest it's ever been!--I've got something on that too in a minute.SO THEN AS WE PASSED ON WE WERE GOING THROUGH THIS JUNKYARD of old scrap iron, and I looked at these piles of old scrap iron on both sides and said, "My, if you can imagine, it's not just the price of gold that's skyrocketing, but even old scrap metal like this is going to be worth a fortune!"WE GOT TO THE BANK AND THE BANK WAS JUST PACKED WITH PEOPLE standing in long queues at each window waiting to do the same thing, to get their money out. I must have figured I could get quicker action by going to see the manager, and I wouldn't have to stand in the queues, so I went through this door into the manager's office.IT WAS A DOOR YOU PUSH IN LIKE SOME OF THESE ONE-WAY DOORS do, and it slammed shut behind me. I turned around and I looked at it and thought, "That's funny!" I pushed on it and it wouldn't open, for it just opened inwardly, but it wouldn't open outwardly, and there was no handle on the inside so there was no way I could open the door from the inside. I thought, "My Lord this is just like a trap! I'm trapped in this bank!"THEN ALL OF A SUDDEN THE WHOLE BUILDING BEGAN TO SHRINK! I thought, "My God, this thing is going to crush us all!" The bank was literally shrivelling, crushing, and the walls were beginning to close in on us! But suddenly there came this voice from above: "Don't worry! The Green Pig is about to explode and it'll blow the bank to bits!" (See "Green Paper Pig," Letter No.243.) And I woke up--Boom! Just like that! It was like a nightmare!I THOUGHT, "LORD WHAT DOES THAT MEAN?" Then suddenly there dawned on me something I told you before: When those big business financiers, were releasing the Green Pig to chase us down the Jordan Valley, remember it was just a little thing at first? But as it raced down the Jericho road and then down the Jordan it got bigger and bigger and bigger just like a big balloon, till by the time it got almost to us it was like one of those big blimps--a huge parade balloon!OF COURSE! WHAT DOES THAT SYMBOLISE?--AN INFLATION of the Dollar value! The Green Paper Pig was inflating and getting bigger and bigger and bigger all the time, until suddenly it burst! You understand?--The "Green Paper Pig is about to explode and will blow the bank to bits!"--The monetary system is about to explode and cause the capitalistic financial system to collapse!BUT I WAS SO SCARED of whatever it was, the idea of the bank blowing up didn't seem to appeal to me much more than the bank collapsing on me! The voice said, "Don't worry! The Green Pig is about to explode and blow the bank to bits!" It seemed the voice came out of the sky like an angel.WHEN THE GREEN PIG EXPLODED, THAT WAS A SUDDEN INFLATIONARY EXPLOSION OF THE MONETARY SYSTEM!--And what happens?--What followed?--It collapsed!--In total deflation! See? That's a deflation: It just collapsed! Then I was thinking, "I wonder if that has anything to do with the comet and the 40 Days and the destruction of America?"IMMEDIATELY I SAW THE PRICE OF THE DOLLAR GROWING and growing: The Dollar, the green Dollar, the Green Pig, is literally inflating right now very rapidly. But I was thinking, "Lord, how come America seems to be coming out on the best side of the deal, and the dollar's going up in value? If You're about to destroy America, how come the Dollar's going up?" Well it's inflating, so of course it's going up!IT'S GOT TO INFLATE BEFORE IT CAN EXPLODE! It would be funny if the Lord destroyed America through its greedy god, the Dollar! There might be an earthquake or bombs or heaven knows what, and it could be that too. But the dollar is definitely inflating and it's got to eventually explode!--And boy, if anything would ever destroy America, that would be it!--And of course it would also destroy the whole world monetary system which is based on that Green Pig!"DON'T WORRY! THE GREEN PIG'S ABOUT TO EXPLODE and it'll blow the bank to bits!" In other words, that is obviously symbolic of an inflation that's so bad that it finally just absolutely explodes and collapses the whole monetary system, and the bank must represent the financial system the banking system and so on. If this happens, it will literally blow the whole world banking system, its financial system, to absolute bits!IT'LL BE A TOTAL WORLD COLLAPSE OF THE MONETARY SYSTEM which is built on that stupid Paper Pig! See! Isn't that ridiculous? If that little Pig inflates to that point where it explodes, it's going to literally blow their whole monetary and financial systems to bits! If the monetary system explodes, it will literally destroy the financial system. The bank must represent the financial system.THAT'S WHERE I WOKE UP, and I was thinking, "How come the poor pound has gone down, down, down, and the Dollar's going up?" The answer came to me as clear as anything: It's the Dollar that really has to explode! It will be so inflated in value that it finally explodes! See? The pound has actually gone down in value, which in a way is safer for the pound, believe it or not, than to be inflated like the Dollar is right now. But boy, our friends better get their money into gold or they're going to be sorry!THEN IT CAME TO ME as plain as anything: "Well, what do you think is doing it? Why is the Dollar inflating?"--This is what's doing it: They are selling out their European currencies and buying Dollars instead! The banking interests apparently are buying Dollars and dumping pounds and European money deliberately to try to hurt England and Europe for the stand they took on the Mideast! So they're dumping their European currencies and buying Dollars to favour their friend America and punish Europe!THIS FULFILLS EXACTLY WHAT THE LORD SHOWED ME about what they were doing in that dream about the Green Paper Pig! (editor's comment: another dream the author had) They're the ones who are releasing the Green Paper Pig and causing it to inflate, you see?--The Dollar! (Maria: But it's their pig.) Yes, it is their pig, but apparently they thought they could control it.THEY NEVER DREAMED IT WAS GOING TO GO SO FAR, see? They thought it was going to scare hell out of us and cause us some kind of damage. But instead of that I just pointed my finger at it and it went "Poof"! Boom! Exploded! And that was it! They never expected in to inflate to the point that it was going to absolutely explode and be totally destroyed!THEY REALLY UNLEASHED THAT GREEN PIG ON THE EUROPEANS, SEE?--Because what were we doing in the Green Pig dream?--Europe was crossing the Jordan of decision and the Dead Sea of death to the Dollar to the side of the Arabs in that dream! The Green Dollar Pig is the weapon they are using against the Europeans for siding with the Arabs for oil!THEY ARE UNLEASHING THIS DOLLAR INFLATION WEAPON against the Arabs and their friends!--You get it? That would include Britain and Europe, whose currencies are going down in relation to the Dollar. The Dollar is expanding, inflating, going up in price, whereas European currencies are going down.BECAUSE THEY ARE DUMPING THEIR EUROPEAN CURRENCIES AND BUYING DOLLARS! They are the ones who have precipitated this monetary crisis deliberately, see? That's why the international monetary fund and all those big money boys, the Council of 20 and Council of Ten, etc., have gotten together several times lately to try to agree on a monetary policy, but they flatly refuse--they can't agree on it. The only reason they can't agree is that they don't want to agree!THOSE WHO CONTROL THEIR PORTION OF THE MONEY which is tremendous, their big banking interests don't want to stop it. They're using the inflation of the Dollar to try to destroy their enemies, including pro-Arab Europe! They know how much money those Arabs have got invested in Europe, and they are trying to destroy not only the Arabs but the Arabs' friends, which would include Europe and Britain.BUT THE INFLATION WHICH THEY HAVE PRECIPITATED WILL GET OUT OF HAND AND THE DOLLAR WILL EXPLODE AND BE TOTALLY DESTROYED INSTEAD! Instead of becoming a monster that was going to frighten and devour their enemies, when I pointed at it, it exploded!SO THE DOLLAR IS INFLATING LIKE MAD RIGHT NOW, and when it gets to that point that it explodes, the whole world monetary system will collapse!--And the bankers and capitalists will be left sitting on their stacks of bank notes which will be worthless!ANOTHER THING WHICH SHOULD HAVE BEEN HEADLINES IN THE PAPER YESTERDAY WAS THE PRICE OF GOLD: It's up to nearly $140 an ounce, the highest it has ever been in history! There wasn't one word in the paper about the fact that the pound had sunk another 10% in a week and that gold had gone up almost another 10%! This shows the Dollar is really not all that valuable, but only better than other currencies. So it began to dawn on me what all this meant, or what it could mean: The soon explosion of the Pig!THEN I SUDDENLY REMEMBERED THE NEWS THAT RUSSIA HAD JUST ANNOUNCED SHE'S GOING TO CARRY ON ROCKET TESTS in the North Pacific and warned shipping to stay out of the area. I wonder if that has any connection? What could that mean? Why should she be warning shipping to stay out of that area right now, which is near Siberia and Alaska?WHAT IF RUSSIA WERE PLANNING TO TAKE ADVANTAGE OF THE SITUATION, knowing somehow that America's monetary system was about to collapse and therefore weaken the whole country? If the Dollar collapsed America would absolutely collapse! When she collapsed financially, she'd be in a state of absolute chaos!THAT WOULD BE THE SMARTEST THING IN THE WORLD TO DO, TO TAKE ADVANTAGE OF AMERICA IN A STATE OF COLLAPSE and absolute chaos for an invasion! The logical way for Russia to invade, of course, the way that Americans have always been afraid she was going to invade, is the shortest possible route right through Siberia right across the Bering Straits into Alaska and down. Now that's quite possibly what Russia has in mind!BUT HOW COULD THAT AFFECT THE MIDEAST? Well of course, dying America in its last desperate death struggles, what would it do? What was causing it to collapse? If her money had collapsed and she was out oil, what would become the only valuables in the world?IF AMERICA'S WHOLE SYSTEM WAS COLLAPSING AND SUDDENLY GOLD AND OIL HAVE BECOME THE ONLY THINGS THAT ARE WORTH ANYTHING, the only commodities with standards of value and usefulness, what would the Americans do as a last act of desperation? Dying America would do what?AMERICA WOULD TRY TO ATTACK THE ARAB COUNTRIES AND GRAB THE OIL AND THE GOLD! Whatever super power possesses and controls those Arab countries would have all the oil and they'd have most of the gold too, and they would have what would be the most valuable things in the world at a time of crisis like that!SO THE EXPLOSION OF THE GREEN PIG, THE MONETARY SYSTEM, COULD CAUSE THE MIDEAST TO EXPLODE. I have always theorised that it was because of the Arab defeat that they were the ones who would get desperate and start doing the shooting. But the reason we saw the Arabs in our vision doing the shooting could be because they realised or had intelligence that America was about to attack, so they just started attacking first, and then everybody started shooting because they were all prepared for it anyhow.40 DAYS! 40 DAYS, BY THE WAY, IS THE TIME ALLOTTED FOR THE [ISRAELI] DISENGAGEMENT FROM THE EGYPTIANS. 40 Days! Russia is smart enough to see what's happening or about to happen--and, who knows, she may even be helping to engineer it! Russia has long sought to engineer the collapse of the capitalistic system. What better way to help the collapse of the capitalistic system than to explode its monetary system and its banking system, its whole financial system?SO THE RUSSIANS MAY BE GOING TO TAKE ADVANTAGE OF THE SITUATION TO ATTACK A WEAKENED AMERICA. What a perfect preparation for any proposed rocket attack on America! The Money Explodes! The Dollar Explodes! Inflation Explodes!--And War Explodes!THE LORD APPARENTLY GAVE ME THE DREAM TO WARN US THAT THE PIG IS ABOUT TO EXPLODE and is going to destroy the monetary system and with it the financial system, and with it virtually the whole capitalistic system; and Russia is probably preparing to take advantage of situation to destroy America.AMERICA IN ITS LAST DYING DESPERATE HOURS IN VERY LIKELY GOING TO EXPLODE IN THE MIDEAST and try to grab the oil and the gold to save herself. As a result, America and Russia would be going to war and destroying each other, which would work out just like we have seen it before.THEN CHINA, EUROPE AND THE POOR NATIONS OF THE THIRD WORLD COULD TAKE OVER: THAT'S THE HAPPY ENDING! So praise the Lord! Boy I tell you, we are without excuse! The Lord has warned us so much!Copyright (c) 1998 by The FamilyDear Forum readers!One of the most amazing things about this dream is that it dates back to January 1974! The author is Father David, an American by birth - he passed on in 1995. Some things take time and there just wasn't any alternative to the US dollar back then. Now a lot of things have happened in the mean time and it looks like the stage is set for the showdown. We will soon know! I nominate this one to the hall of fame! Please note one important piece of practical advice given: "But boy, our friends better get their money into gold or they're going to be sorry!" Perplexed (5/25/2000; 23:00:58MT - usagold.com msg#: 31315) Rehash ORO I have really appreciated your insight and explainationof the financial system, the figures and statistics are veryinteresting however they do not change fact. As I stated in my original post, The American currency system, sans gold, in the last 50 years, has served as the engine for the creation of more world wide wealth than at any previous time in world history. There is more prosperity, better health care, and increased longivity under the American financial system, than at any time in recorded history. If gold was the key ingrediant to a successful civilization, then the Inca and Aztec nations should have been paradise on earth.Do I believe in physical gold? YES! Do I own physical gold?YES! Do I believe that gold is the only viable money? NO!Do I believe that the system is in trouble? Without doubt! The fault however belongs to the selling of our following generations into indentured servitude by our current government representatives. The Federal Reserve is nothing but an accomplice.It is interesting that inflation is only now being noticed by "news" media, it has been a fact of life beginning with the first "deficit budget." Inflation has been hidden in clear sight since at least 1960, and there has always been only three ways to eliminate it, Taxation, default, or inflation. We all recognize taxation to be a dirty word, we desire the benefits, but hate the cost. Inflation, only as a last resort. Default, a LAST LAST resort. We are now entering the inflation. Are our wizards capable of stealing enough money thru devaluation within the next few years to wipe out 40 years of red ink? We all know the answer to that question. Even know we are kicking and screaming about the price of fuel we run through our $150,000 motor homes.In 1969, in the midst of Lyndon Johnsons war on Vietnam and war on poverty,(both on credit) he made the statement that we had unleashed economic forces that no one understood. He was right. He and the bankers released the doomsday machine of compound interest, and it is now devouring the economic structure which they devised. Who stands to get bitten the hardest by the influx of new money. How about the bankers who are now stuck with long term loans which will be returned with noticeably cheaper money, and a public, reluctant to initiate new loans. This leaves credit cards and bank charges as the primary income. Couple this with a plunging stock market, much of it financed by banks and security companies, and the seeds of disaster sown over the last 40 years are now ready for harvest.ORO I know what is in the works, and I am as aware as you are of the fact that there is no way out. My only differencewith you is the discounting of the wealth now present in this world, it is not going to vanish, just because the markers representing it become worthless. The past accomplishments of the system are not going to vanish, and may well serve as the basis for a new system.Why is no one trying to crash, but, contrarily doing their best to save the American system? Because politicians world wide have their necks on the chopping block. It is not only our government pouring money into the market, when it crashes, so do many governments. The United States is not the only nation in trouble with red ink, Europe is in no better shape, especially France. No one wants to rock the boat because they are well aware of the precarious positions of their respective governments.The United States Constitution must be destroyed! Gold and silver remain the money of account within this document. There was nothing designated as money when gold and siver was removed under the color of law, this is the sword hanging over the heads those who will try to prosecute the paper claim to the vast wealth of the nation. The only way that may be changed is by amendment. This is the reason for the attacks on the 2nd Amendment, if it can be discredited,then we are without lawful government.Still Perplexed ax (5/25/2000; 22:50:56MT - usagold.com msg#: 31314) SHIFTY On, Gold Fields, Ltd, it could be an impending merger.On the web site, I sent multiple emails but the problemremains. I am puzzled. Thanks for letting me know that itworks for you now. SHIFTY (5/25/2000; 22:44:30MT - usagold.com msg#: 31313) ax I had a bit of trouble tonight getting in . I got a page to send an e-mail for help . I did send the e-mail and came here to read for a while. When I tried again it worked fine . Lots to read there. Just checking back here to see if anyone knows what is going on with Goldfields Ltd. I don't know if I should laugh or cry. beesting (5/25/2000; 22:37:54MT - usagold.com msg#: 31312) @ Sir Towncrier # 31211 5/24/11 TownCrier said: If a someone such as beesting or Solomon Weaver or ORO were to suddenly find the need to share their own investment strategy and advice on the forum which turned out to be exactly this same trade, I may or may not offer a kind word about remembering to factor in counterparty risk, but that would be it.Townie, I am very flattered you included my handle on a sharing of investment advice,but I live under a bridge of the interstate highway system here in the Western U.S. with only my PC and my 2-400 ounce Gold Bars for company(BIG BIG BIG SMILE),but I sure am happy!!!Seriously,I would consider myself an ultra contrarian, but I will share this:Being Scottish, I was tought at an early age to save as much as practical the fruits of my labor.(money)Rule # 1 NEVER,NEVER spend more than you make on a monthly basis(except for real estate purchases)If you want to buy anything save your money and pay cash,you appriciate it more.My first "investment" was a standard(at that time) 5% savings account.My second investment was a duplex house my wife and I bought around 1968.We paid off the promissary note in full including interest in 1971.By 1975 I had invested in stocks and gone to school earning enough credits to become a stock broker, I never took the exam.By 1983 I went into semi-retirement earning enough being a trucking owner operator and stock investor during the 1977-1983 run up in Gold to kick back....age 43.I also lost a lot investing...be prepared for that!My investment advice...NEVER invest in something you don't completely understand, or you may be sorry, and I agree with Holtzman, diversify!Think of yourself and family as noble bankers of old backing your investments with PHYSICAL Gold! The percentage is up to you.Disclaimer:None of this is meant as investment advice.....beestings wife(fights like Al Capps Mammy Yokem, you know L'il Abners mother) forced me to write this.....good night all...beesting. ax (5/25/2000; 22:27:38MT - usagold.com msg#: 31311) HELP Since the Le Metropole Cafe revised its web site it doesnot recognize my password. Does anyone else have the sameproblem? Hill Billy Mitchell (5/25/2000; 22:25:45MT - usagold.com msg#: 31310) Taurus re: trading Investing in paper to make a profit is not the same thing as transfering wealth from paper to hard assets for preservation purposes. You do two different things. You make profits by trading in paper and preserve wealth by transferring your earned profits from paper to hard assets. I do the same only my choice of earning paper profits is that of performing services for others at a paper profit and taking my savings after necessities and transfering the savings into hard assets for preservation. The only difference between you and me is our method of earning a living. I keep my occupation off the internet but I can assure you that my return on investment cannot be measured in percentages because I do not know how to put a math computation on my labor investment. The 40% has nothing to do with what you are implying. You are implying that you are more sucessful than others by comparing apples with oranges.Do not take my comments to mean that I do not value your contribution to our education on this forum.hbm Hill Billy Mitchell (5/25/2000; 22:07:24MT - usagold.com msg#: 31309) Correction upside-down spread FF vs long bond = (.29%) Hill Billy Mitchell (5/25/2000; 22:03:35MT - usagold.com msg#: 31308) Official release http://www.bog.frb.us/releases/H15/update/ Official: Federal Reserve Statistical Release Release Date: May 25 2000 Rates For Wednesday, May 24, 2000Federal funds 6.48Treasury constant maturities: 3-month 5.9210-year 6.4720-year 6.6130-year 6.19upside-down spread FF vs long bond = (.34%) TheStranger (5/25/2000; 21:58:42MT - usagold.com msg#: 31307) Clarification The first three paragraphs of my prior post were intended for Hipplebeck. Thanks. TheStranger (5/25/2000; 21:57:03MT - usagold.com msg#: 31306) Hipplebeck, Shifty, Al Fulchino and Canuck Productivity is higher in the U.S. than any other country in the world. This is because of a degree of automation and infrastructure here which simply does not exist in any of the countries whose labels you mention. It is also because there are fewer governmental barriers to wealth creation and relatively less corruption in the U.S. than in most other countries. Furthermore, it is precisely because of the labor intensive, low productivity nature of some manufacturing that it is done overseas. Believe me, America wouldn't be so productive if so many of us had to assemble things with our hands all day.It may also interest you to know that the U.S., in addition to being the world's largest importer, is also the world's largest exporter. This information is readily available to anyone who cares to pursue it. Furthermore, had you read my post more carefully, you would realize that I clearly said the national debt AS A FUNCTION OF THE SIZE OF THE OVERALL ECONOMY is well below previous extremes, and it's shrinking. To clarify this point, imagine if you owed the bank a million dollars and Bill Gates owed the bank two million dollars. Yes he owes them more than you do, but as a function of one's ability to pay, he owes them far less than you do. This is consideration is elemental to the point that was being made.I cannot very well consider you rude for standing up and shouting "Baloney" when you think it appropriate, even if you are mistaken. I would do the same thing. But if you really want to engage other serious students of economics, you may be wise to give more thought to what you post. If that sounds like an insult, believe me, it isn't. I obviously share your fascination with these subjects and will be happy to contribute to your understanding anytime.Shifty - This not being a suitable time or place for such topics, I can only guess at the reasons for your cynicism about so many things. I'll bet you have a lot to say about the times you've been "sold down the river" as you say. But I also have a hunch you have accomplished a lot more in your life than you sometimes give yourself credit for. You are obviously a smart guy who likes a challenge. I appreciate your friendship.My thanks to both Al Fulchino and Canuck for recent compliments. Gandalf the White (5/25/2000; 21:45:03MT - usagold.com msg#: 31305) oh oh !! I was going to welcome you to the RoundTable, Taurus, BUT you should have read some of the rules before you jumped in.<;-) Solomon Weaver (5/25/2000; 21:17:28MT - usagold.com msg#: 31303) the real cost of newly mined gold is $360 ounce http://www.tocqueville.com/brainstorms/printbrainstorm0067.html A snippet from today's John Hathaway post on gold hedging:"Few mine company executives seem to grasp the importance of the relationship between the cost of replacing reserves and hedging decisions. In our view, that cost is well above the market price, probably in the range of $350-$360/oz on an industry wide basis. While annual reports and financial presentations of gold producers focus on cash cost per ounce, or total cost to produce, almost no company that we are aware of considers replacement cost in the context of hedging.".............Out there in the world of gold mining, it seems that in order to run a healthy gold company, including exploration, development, and full utilization of reserves, as well as a reasonable return on investment (attract ongoing capital), that a real cost of gold mining in on the order of $360/ounce (at today's dollar and economy)...and remember, many mines are in "third world nations not earning many dollars".So anyone who goes out and buys a gold Krugerrand for $270-$283 is getting a nice specimen, with a beautiful design, highly portable and highly recognizable for 80% of the replacement cost...and gold, unlike cars does not wear out with the years.Poor old Solomon ORO (5/25/2000; 20:50:35MT - usagold.com msg#: 31302) AlFulchiano, Perplexed, The Federal Reserve's non-gold standard Two points on the comments you two posted:At the start of the banking crissis, the gold in the US banking system was sufficient to redeem only 3.75% of the outstanding accounts. For all intents and purposes, the gold standard was abolished when the Fed doors opened. Within 15 years, the fiduciary money - woven of promises and the privelege of calling the promises "gold" - grew nearly 7 fold. The economy was running on high octane 96.25% credit money. Obviously, credit money was what had failed then.The ease and convenience you ascribe to credit money is not the result of it. It is the result of the technology that makes possible the immediate ascertainment of availability of bank balances or credit lines. Neither of these would be limited by a free market money. What would be limited would be the volumes of credit issued beyond the capacity of the economy to produce goods. What would be limited is how much your government can spend before you notice it and say "no". What would be limited is the capacity of bankers to take the extra 5% interest that they can charge over the natural gold interest rate of 3% on long term loans. It would put you on an equal footing with bankers and government regarding lending and borrowing. beesting (5/25/2000; 20:25:03MT - usagold.com msg#: 31301) @White Rose # 31276 What Happened to Goldman Sachs Today? ALERT!!! For anyone holding Gold Fields Ltd. Shares Thursday May 25, 11:23 am Eastern TimeGold Fields Limited Issues Cautionary AnnouncementJOHANNESBURG, South Africa, May 25 /CNW/ -- Shareholders of Gold Fields Limited(Nasdaq: GOLD; JSE: GFL) are advised that, as a consequence of Gold Fields being involved indiscussions with a number of parties, the price of Gold Fields securities may be materially affected.Accordingly, shareholders are advised to exercise caution when dealing in the company's securitiesuntil a full announcement is made.For further informationWeb site: http://www.goldfields.co.zaComment:Goldfields Ltd. Shareprice rose slightly today!Does anyone have any more news on what this is about?Is the Goldman Sachs rumer and this press release related?Is Goldman Sachs trying to Blackmail unhedged Gold Fields Ltd.??We watch together....beesting. Al Fulchino (5/25/2000; 20:23:33MT - usagold.com msg#: 31300) elevator guy (5/25/2000; 20:15:30MT - usagold.com msg#: 31297 And I can see dear fellow that yours goes to the top floor, thank you.....Off to pick the wife and kids up at the airport. To one and all peace in the heart and soul. Al Fulchino (5/25/2000; 20:21:53MT - usagold.com msg#: 31299) HI - HAT (5/25/2000; 18:49:32MT - usagold.com msg#: 31287) HiHat ole fella, the answer is yes. Yes I do, it is very much a golden subject, yet I fear it is not the type of gold we usually talk about here. If you would like to talk about it, then everything at my disposal, email, phone number and any other thing you require is at your disposal. Let me know...also how did you know about my interest?Hmmmmmmmmmm Al Fulchino (5/25/2000; 20:17:21MT - usagold.com msg#: 31298) Free trip to Hawaii Christopher / Hi Hat re:HI - HAT (5/25/2000; 18:56:01MT - usagold.com msg#: 31289)Christopher ...................Back FortyI only have 10 acres ; but 40 guns ! : -)Christopher, I just bought ole Hi Hat two round trip tix to Hawaii for seven days at the Hawaiin Hilton Village for seven days. Think I can do enough metal detecting and shovelling of ten acres on seven days? <wink> elevator guy (5/25/2000; 20:15:30MT - usagold.com msg#: 31297) @Al Fulchino And a giant at heart! Al Fulchino (5/25/2000; 20:12:53MT - usagold.com msg#: 31296) Town Crier Unfinished business from last night: At the forefront, I acknowledge that your instincts regarding Goldhunter may in the end be correct, and IF that is correct I will have to acknowledge your instincts. At the time and even now, I do not see that he or BTD really stepped over any line. I feel they have added a lot for this forum's elite to be challenged by. They provide real examples of differing strategies and as long as sincerity is the drive behind their message then I think we are better off for the shared ideas.Also and this is the most important for me when I see the back and forth between you all, it sorts things out for me.<wink> I don't know if you are aware that one reason so many Italians are short, ( I am of Italian descent by the way before anyone starts attacking me ..smile) is because years of living in small villages, with very little outside contact resluted in many marriages that were not varied enough in the gene pool. Thus, we like them, will begin to stunt our thought and argumentitive talents without a good mix of people to draw out the best in all. Anyway that is the end of it from me. Thank you for your post last night.PS I am six feet tall <whew!!!> Cavan Man (5/25/2000; 20:08:57MT - usagold.com msg#: 31295) Nikkei Tokyo index takes out 16K. More selling in Japan. Chris Powell (5/25/2000; 20:07:24MT - usagold.com msg#: 31294) Midas commentary for May 25 http://www.egroups.com/message/gata/467? Midas commentary for May 25 by GATAChairman Bill Murphy.To subscribe to GATA's dispatches by emailand get them immediately so you don't haveto go look for them, send an email to:gata-subscribe@eGroups.com TownCrier (5/25/2000; 19:56:39MT - usagold.com msg#: 31293) Today's market at a glance: Contracts being sold...who's buying? Here are some excerpts from various sources that you may find to be thought provoking, somewhat illuminating, or (take your pick) either reassuring or downright frustrating. To see the paper nature of these lower gold prices, read on...-----------------------New York--May 25--COMEX Jun gold futures hit a 8 1/2-month low Thursday on fund selling, as buying interest has largely dried up [since Tuesday].Traders said one US fund in particular was a heavy seller throughout the session. Sell stops below $272 were triggered and added momentum to the sell-off.Some of the selling pressure was linked to liquidation related to the upcoming rollover of the Jun contract month to Aug. Tuesday is gold futures last notice day."The shorts keep piling on," commented Leonard Kaplan, president of Prospector Asset Management in Chicago.Kaplan noted that there is a tendency in both gold and silver for prices to move lower in the first four or five days in front of a futures month delivery date.Market longs, if they want to roll into Aug, have to pay a "revoltingly" high price because the contango is extremely high, Kaplan explained. So instead of rolling, many just liquidate.Bill O'Neill, director of futures research for Merrill Lynch, said gold's move was based almost solely on weak technicals. "There really isn't anything seasonal or fundamental about it. When we get thin conditions like this, the chartists really take over," he said.***(c) Copyright 2000 FWN Reprinted at USAGOLD with permission. For details please go to:http://www.futuresource.com/internet.shtmlNo further reproduction without written permission from FWN.-----------------------------From the WGC weekly gold market commentary:"The latest statistics published by the Commodity Futures Trading Commission showed the net short position of the large speculators increasing on Comex during the two weeks ended May 16, rising from 20,353 contracts to 29,530 contracts." TownCrier (5/25/2000; 19:13:15MT - usagold.com msg#: 31292) Canuck's Question... "Each day in the newspaper and on television the POG is communicated, yes? Sometimes spot, sometimes a future month. Are these prices quoted discovered from paper?"Hello Sir Canuck. Where I have apparently failed to convey the method of gold price discovery despite repeated attempts, allow me to turn the podium over to one who communicates much more effectively:ORO (5/25/2000; 6:21:15MT - usagold.com msg#: 31228)"The paper markets provide an investor with a means to play the price of gold. They do not reflect directly the availability of gold, just the availability of paper obligations denominated in gold. As such, the gold prices discovered by these markets are detached from the reality of gold supplies. The price of gold in these markets is the value of a fiduciary gold."Just to complete the picture for you, spot prices, then, are arrived at by mathematical adjustment upon the price discovery of the trading on the most active futures contract--adjusted in order to account for the "time value" of the two funds involved...interest rates on the dollars and lease rates on the gold. Leland (5/25/2000; 19:05:22MT - usagold.com msg#: 31291) Java, That Address is From 1997. Yes, it is Probably Out-of-Date. . JavaMan (5/25/2000; 19:02:10MT - usagold.com msg#: 31290) Leland... Thank you. I think your post is truly inspirational. Are you sure the link is correct? It times out. HI - HAT (5/25/2000; 18:56:01MT - usagold.com msg#: 31289) Christopher ...................Back Forty I only have 10 acres ; but 40 guns ! : -)You are right! Gold and silver are the best sleeping pills. Netking (5/25/2000; 18:51:54MT - usagold.com msg#: 31288) Canuck (31285) ...I prefer to look at it as a window opportunity...this is a short term thing...before all "Hell breaks loose" in this particular market. I for one will be ready! HI - HAT (5/25/2000; 18:49:32MT - usagold.com msg#: 31287) Al Fulchino Masters Hello to you, and a golden sunset, from the Gulf Coast ofFlorida.In your opinion, is the Roy Masters material worthy of one to look into? JavaMan (5/25/2000; 18:43:17MT - usagold.com msg#: 31286) All... Is it my imagination or are the insights posted lately reaching a new level of excellence?Sir Canuck, hang tough...the only possible way to lose is if you sell. Actually, that's a lesson I learned long ago...never, ever invest money you might need later. That way, you can ride out anything. Unless, of course, you invested in something that has a limited life expectancy. If you did, you may not want to admit it here though (smile).SS, you said..."are TRUTH and GOLD related in history?" I ask, aren't the two synonymous? John Doe, if I may borrow from another source...MENE, MENE, TECKEL, UPHARSIN. The writing IS on the wall and I think, unfortunately, this paraphrases your post (and the state of our Union) most effectively. Canuck (5/25/2000; 18:31:53MT - usagold.com msg#: 31285) Post # 28110 http://www.kitco.com/charts/livesilver.html Odd that silver took the EXACT same line today, thieving, lying, crooked s.o.b.'s. Tom (5/25/2000; 18:10:54MT - usagold.com msg#: 31284) Mr. Oswald Murphy - DROOY - the straight story This is a reply sent to Steve Saville in response to a statement he published on Gold Eagle: Hi Mr. Saville I read with interest that Durban Deep has been expanding its hedge book. This is not true. Mr. Roger Kebble ( Chairman ) , Mr. Mike Prinsloo ( CEO ) , Mr. Charles Mostert ( CFO ) and myself manage DRD s hedge book. We have not authorised any forward sales of gold since prior to the last UK Gold Auction. What we have done however, is to guarantee greater upside participation through buying Call Options ( 1.2 million ounces ) and physically buying back of certain forward sales. Our current ônet exposure is 850,000 ounces ( being forward sales plus call options sold less call options bought ) which is less than one year of DRD s production ( 1.2 million ounces ) . This hedge book is managed in the interest of all stakeholders. The DRD hedge was put in place to protect the business against further declines in the gold price. It was also put in place to protect our capital upgrade and renewal programmes that have been essential in the growth of DRD production profile over the past two and a half years. We have completed sixteen of these programmes to date and are busy with the last three programmes. All these will add additional ounces at more than $250/oz. Part of our hedge is used to protect marginal mines from closure and then restarting mining operations ( at extremely high cost ) during this very volatile period of gold price movement. We have also been busy with restructure programmes at the operations we have acquired and we fix a target price for these operations while we conclude the restructure and bring these operations into profit. As we continue to acquisition and grow, the percentage hedged reduces accordingly. With the recent Harties acquisition with an additional 400,000 ounces of production per annum and our growth in Australasia, DRD is now a 1.2 million ounce producer per annum which will continue to reduce our net exposure and allow upside participation. DRD s reserves exceed 14 million ounces, which means the ônet exposureö is roughly 6% of DRD reserves ( and 1% of resources ) . Our current hedge is spread over a five-year period, but we have the ability to accelerate delivery into our hedges that we are currently doing in order to maximise exposure for future upside participation. This to us is good business and adds to shareholder value. We are well positioned to take advantage of the higher gold price. I would appreciate if you could correct the statement that you posted on Gold Eagle, as it is incorrect, damaging to shareholder value and skews perceptions of DRD. Regards Ian Murray ( Manager: Corporate Finance ) Leland (5/25/2000; 18:05:35MT - usagold.com msg#: 31283) ss of nep, Your Message is Well Answered by Paul Hein (phein@inlink.com) "Until April of 1933, gold was used as money in this country. Silver was used until June of 1968, when the irredeemability of Silver Certificates became final. Since then, nothing has been used as money; we exist only on credit, or belief. Can you have a sound economy without sound money? That seems as unlikely as a fortress built upon sand, but we are told that the economy is strong. The astonishing popularity of the president is attributed to the fact that the economy is so robust. How is this possible? Have our money managers accomplished the impossible? A friend who goes from obvious good health on Monday to emaciation by Friday is obviously not doing well. However, if the degeneration is slow, over decades, and if the unfortunate friend is able to rouse himself occasionally, we might say that he is "doing well," although, in fact, he is dying. It is in this sense, I believe, that our economy is "doing well." Young people, who have never seen the dying economy in a state of good health, may disagree. Statistics are not of much help in this situation, because many of them are based on 'dollar' measurements, which are, inescapably, deceptive. Until 1968, the dollar was a fixed amount of silver; today it is no particular amount of anything. Comparisons are not simply between apples and oranges, therefore, but between apples and imaginary oranges. So comparing average income now and in, say, 1950, is meaningless, because in 1950 income was measured in ounces of silver; today it is measured in - what? Moreover, the numbers (on bills or checks) which represented money in 1950 now represent nothing, but are much larger. It is difficult – probably impossible - to fully convince someone that $10,000 in 1950 was about the equivalent of 75,000 or 80,000 bucks today. But no one can deny that the tax rate on 75,000 is much greater than on 10,000, so that even if the larger number is equivalent to the smaller number of dollars, the tax upon it is much more. How can society prosper when less is taxed at a greater rate than more? For those of us of a certain age, what could be termed (perhaps with a wee bit of disdain) nostalgia suffices to clarify the situation. I remember, for example, when homes were made of brick, not brick veneer on the front only. Interior walls were plaster, not wallboard. Mail was delivered – to the door - twice a day. There were alleys behind the houses – wonderful places for riding bikes or playing games! There were sidewalks in front, with streetlights. Mom didn't have a job outside the home. A milkman delivered milk, cream, cottage cheese, etc., to the door daily, and the cleaner picked up and delivered the clothes. There was even a man who came once or twice a year to change the furnace filters! Department stores delivered also, and not just large or expensive items. Buy a handkerchief and a pair of socks downtown, and they would be delivered the next day. And downtown was an exciting, bustling, prosperous place. I can't recall vacant stores, or boarded up buildings. We had three newspapers in town, not just one. You could go anywhere on the streetcar or bus, at any time. The railroad station hummed with activity. Has anyone related the disappearance of these things to the introduction of fiat money? It would be a fascinating study for someone writing a paper on economic trends. Is it farfetched to associate sound money with sound morality? In addition to the material aspects of life I've cited, there was an obvious moral difference between then and now. Children in school did not, with some regularity, assault one another or their teachers. Metal detectors, even if they existed, would have been unheard of in school. Condoms were not mentioned, much less distributed, in the belief that the innocence of childhood was precious and should be preserved. Today that idea holds as much currency as the idea of sound currency! One could attend a movie without being embarrassed by the language, and listen to a popular song without being incited to kill a policeman. I do not assume that sound money causes a sound morality; rather the reverse. Sound morality takes honest money for granted. If we think our president is doing a grand job, and that the economy is booming, maybe it's because we don't know right from wrong!" Canuck (5/25/2000; 17:59:03MT - usagold.com msg#: 31282) Question http://www.kitco.com/charts/livegold.html I'm going to ask the dumbest question probably ever asked on this forum. Ready.The link above reflects 'spot' price for gold correct? Each day in the newspaper and on television the POG is communicated, yes? Sometimes spot, sometimes a future month.Are this prices quoted discovered from paper?When I buy gold I buy from spot. Tomorrow I will be able to buy spot cheaper, yes? So when this 'paper' burns and physical separates from it what will spot be quoting 'paper'or physical? Canuck (5/25/2000; 17:47:06MT - usagold.com msg#: 31281) POG Seeing the POG break through 270 makes me weak in the heart.Please tell, please reassure me that the graph today doesn't mean anything.I have full faith in gold, physical that is, just need a little comforting. I noticed the unhedged Goldcorp(g.a,TSE)actually went up today; a little comforting. How did the XAU make out?I'm worried and confused but funny, I feel strength building. It must be close, markets are completely haywire.Analysts are completely opposed, odd, like 'paper and physical' opposite.Thanks. ss of nep (5/25/2000; 17:22:59MT - usagold.com msg#: 31280) are TRUTH and GOLD related in history ? I do think a contest is in order. White Rose (5/25/2000; 17:06:54MT - usagold.com msg#: 31279) followup to my message #31276 http://www.lemetropolecafe.com Moments after I posted my message asking for information about Goldman Sachs, I got an e-mail from Bill Murphy of GATA about a new posting on the "Le Metropole Cafe" website. While this is in a members only section, I will quote a portion of his message:----------My guess is that behind the scenes there is serious concern regarding some financial market stress or event that is about to surface, or have a negative effect on a fragile stock market. It could be that the dollar is about to take a sudden beating, it could be that the price of oil is about to soar towards $40 per barrel. It could be that a known financial institution is in big trouble for some reason. Something like that.Whatever it is, the "powers to be" must be afraid of a stock market meltdown (I wrote that earlier today). Today's actual big stock market drubbing is some additional confirmation on my thinking about why gold is being trashed.These same powers (bullion banks and the New York Fed/ESF) know that a gold derivative banking crisis could develop if the price of gold started to move higher during a period of general financial instability.It is the build up of these gold derivatives that is keeping down the gold price. That is clear from the data that GATA has discovered. If investors were to turn to gold in a time of general financial chaos, a gold buying panic could quickly get out of hand and set off a series of gold buying chain reactions. White Rose (5/25/2000; 17:06:14MT - usagold.com msg#: 31278) followup to my message #31276 http://www.lemetropolecafe.com Moments after I posted my message asking for information about Goldman Sachs, I got an e-mail from Bill Murphy of GATA about a new posting on the "Le Metropole Cafe" website. While this is in a members only section, I will quote a portion of his message:----------My guess is that behind the scenes there is serious concern regarding some financial market stress or event that is about to surface, or have a negative effect on a fragile stock market. It could be that the dollar is about to take a sudden beating, it could be that the price of oil is about to soar towards $40 per barrel. It could be that a known financial institution is in big trouble for some reason. Something like that.Whatever it is, the "powers to be" must be afraid of a stock market meltdown (I wrote that earlier today). Today's actual big stock market drubbing is some additional confirmation on my thinking about why gold is being trashed.These same powers (bullion banks and the New York Fed/ESF) know that a gold derivative banking crisis could develop if the price of gold started to move higher during a period of general financial instability.It is the build up of these gold derivatives that is keeping down the gold price. That is clear from the data that GATA has discovered. If investors were to turn to gold in a time of general financial chaos, a gold buying panic could quickly get out of hand and set off a series of gold buying chain reactions. John Doe (5/25/2000; 16:57:57MT - usagold.com msg#: 31277) Gold & Paper Should one hold physical gold, futures, shares, options on futures, or options on shares? It depends on one's objectives: speculation, investment, savings, or wealth preservation. Generically speaking, in ordinary times, one may choose to hold a proxy for physical gold. But, even in ordinary times, one should make no mistake that one is surely "holding a proxy for physical gold" and all the risks (and benefits) that entails. Yes is yes and no is no, black is black and white is white, gold is gold and paper is paper. Gold and paper are, in an investment sense, and certainly in terms of risk, polar opposites…for how can one convert that which is the antithesis of liability into the essence of liability and still consider the two interchangeable? The two are only nominally interchangeable, not de facto interchangeable. As ORO, FOA, et al have pointed out, in times of stress the commonly assumed points of "interchange" may well not function.When the rubber meets the road, nominal interchangeability will not magically yield to a higher standard of de facto interchangeability, and I fear we have a great deal of unfamiliar road ahead of us. These are FAR from ordinary times. Therefore, one's objectives are, or should be, materially aligned to the times that exist. As much as the interlocking banking-government combine would wish this "self-inflicted expansion" to continue, the nascent contraction will not be averted, only delayed and worsened by the excessive, unnatural continuance of the current round of debt expansion.Though I cannot generally advocate holding gold derivatives, except perhaps for a small allotment across unhedged mining shares, there are times when a gold futures contract would be an "ok" speculation vehicle. But for now, gold futures are a very poor speculation We have been given generous fair-warning of the lack of cohesion underpinning the global financials, especially in the derivatives area. Currently, he risks in gold futures far outweigh the potential reward, for both the contracts and the currencies in which they are settled. If all derivatives could be thought of as being at one end of a leaky financial boat, it's time to move to the other end…where the gold-plated lifeboats are stationed.The rules of futures and options settlement are stacked against the speculator as it is and in this climate especially, the very culmination of which one may well be anticipating in terms of potential reward. The events that could collapse the global financial system, and by extension unleash gold, are the very events that could foul futures settlement and lead to massive defaults of derivatives of all kinds. Within such an environment, I find it highly unlikely that the hoary golden whipping boy will be given favorable treatment in terms of institutional/governmental support and forced contract enforcement.The history lessons bear repeating:A bank overissued gold certificates, reneging on its promise to exchange the gold certificates for gold upon demand. The bank defaulted and the gold certificate holders were cheated and left with worthless paper.A government-regulated and sanctioned central banking system overissued gold notes domestically, reneging on its promise to exchange gold notes for gold on demand. The government defaulted by recalling all gold in circulation at the central bank's behest, and then devalued the central bank fiat currency given in exchange for the confiscated gold. The former gold note holders were cheated and left with devalued paper.A government overissued its commitments to balance its trade in gold with other governments, reneging on its promise to exchange its international currency for gold on demand. The government defaulted and the other governments expecting payment in gold were cheated, left only with the option of continuing to hold their balance of payments as credits with the defaulting nation. The longer they held these credits, the more they eroded in terms of the gold for which they had originally contracted.A global derivatives system, operating largely without oversight because the world's governments are too fearful of opening a Pandora's Box, created a massive pyramid of contracts far in excess of reasonable commercial needs across many vitally important markets, including gold,…[That's where we are right now. One may fill in the blanks in a number of imaginative and surprising ways, but I expect the conclusion to be something along the order of:]…reneging on the terms of their derivative promises. In essence, the dollar-centric, global financial system defaulted, leaving the many derivatives holders insolvent and screaming for a bailout from an already inflation-racked, debt-burdened taxpaying public. White Rose (5/25/2000; 16:50:22MT - usagold.com msg#: 31276) What happened with Goldman Sachs today? The stock market took a sudden dive this afternoon. It had something to do with an announcement from Goldman Sachs. On another forum, I saw something about rumors circulating through Wall Street that a hedge fund was in trouble, and the fund was Goldman Sachs. The price of gold went down $5 today in New York. Would this be the result of Goldman Sachs trying to unload a lot of paper quickly?Does anyone have any information about this? Am I reading too much into events? Does anyone know anything about this situation? Al Fulchino (5/25/2000; 16:45:03MT - usagold.com msg#: 31275) You have to like these two guys They are both bold. They both firmly believe in what they post. They make this a strong forumTrail Guide displays his enthusiasm with this bold statement:Yes, the leverage against the explosion and demise of derivatives is only in physical gold. What an incredible event this is going to be! The Stranger's arguments are always strong, here he displays humility, but I know in the future he will be able to say...SEEEEEEEEEEEE! I have been predicting higher gold prices in this forum for over a year now, and I have been wrong, wrong, wrong. Absolutely Wrong! Geez! I hope no one was listening. Al Fulchino (5/25/2000; 16:29:01MT - usagold.com msg#: 31274) Perplexed You wrote a terrific post, much of which I agree with, so when I make this comment, do not for a moment think it outweighs my agreements.you write:Most of us seem to overlook the fact that every depression this nation has ever experienced, has occurred under the gold standard, with the constitutional money of goldand silver in free circulation, and paper money redeemable one to one for gold or silver coin.. As we are all aware, the system established by the Constitution was abolished bygovernment edict, with criminal penalties for resistors in order to escape the clutches ofthe depression of the 1930s.I write: It also then goes without saying that every depression that this nation experienced also was ESCAPED with the gold standard in practice....with the exception of the 1930's. My point being that depressions are not inherently the responsibility of a gold standard. Remember there were also many boom periods and tranquil periods during this countries history WITH the gold standard. Hipplebeck (5/25/2000; 16:26:30MT - usagold.com msg#: 31273) To Stranger your message #31243 Dude, I hope you don't think me rude, but you better reread what you wrote here and think about it some more.1. I think the Luddites knew exactly what they were standing up for. It wasn't a material arguement for them. As craftsmen, of coarse they could understand higher productivity. They were argueing against the dehumanizing aspect.2. If you think the national public debt including future social security obligations is small and shrinking, you don't have a clue how much inflation is headed our way.3.Do you understand that most of our wealth here in the US is due to Chinese (and others) productivity? Look on the labels of everything and sing to me about American productivity. When they advance a little more and are building their own machine tools industry, do you really think you will be able to compete with someone working more hours and for way less money? Do you think a country with so many more people will not field as much technology as us when they gear up for it? Trail Guide (5/25/2000; 16:15:16MT - usagold.com msg#: 31272) Comment Again, back to: ORO (5/25/2000; 6:21:15MT - usagold.com msg#: 31228)ORO, You could have not presented this any better than your full post has done. I wanted to note your item: -----The price of gold in these markets is the value of a fiduciary gold. The only mechanism for the connection of the gold price to its supply and demand fundamentals is arbitrage. ---------Yes, and if that process is blocked by an ever falling price? Or better asked, who delivers bullion against a short contract if the contract can be sold at a profit? Arbitrage doesn't happen in these one way paper markets. The contract is covered in a cash close and the bullion is sold on the open spot. Further driving the price. As a percentage of the whole traded paper gold market place, very little is delivered against contracts. If you sell a tonn to a dealer, sure he hedges, but he mostly covers those contracts in cash. Right? My point, that coattails your post, is that the existing gold market as we know it is already mostly in "cash settlement". In a gold crisis, physical could easily be withdrawn from what little arbitrage exists. The lost profit potential from suspect payment in a delivery against contracts becomes the "premium" on "barrel head gold". Or reversed, the contracts trade at a discount. We are so close to lighting the fuse on this, I can almost feel it. World gold derivatives positions are exploding as authorities turn away. There is truly nothing left to protect. Without arbitrage it's a full on cash game. The Euro is incredibly strong considering the interest rate difference with little or no price inflation comparison. The ECB has just held tough. I've said it before and will say again; can you imagine what the Euro would do if they raised rates close to ours? Just look at the ongoing London / Euro iX plans. How long do you think Europe would take to reestablish a gold market in Euros once England makes the dive? Certainly, LBMA is going to lose a few big members as this winds down. Your "fiduciary gold" risk is building daily as the "risk" to paper is truly in cash settlement and currency transition. Not to mention the "walking dead" from the WA bomb.Then there is oil! OH boy! Everyone talks like this political price range will save us. But, the jockeying for position in an alternative Euro must surely be complete. Once the gold flow slows, the oil price will surge. That will break the dollar and the ECB will be cutting rates to stop the Euro from also surging. Next step, a jump to basket or full Euro oil pricing!Yes, the leverage against the explosion and demise of derivatives is only in physical gold. What an incredible event this is going to be! ThanksTrail Guide Perplexed (5/25/2000; 16:07:31MT - usagold.com msg#: 31271) True Wealth Holtzman thank you for the recent post concerning alternatives, you pretty well put theplug in the jug on this discussion, like religion, the question is not about right or wrong,but choice. After auditing the forum for several months, over this last week I have invested considerable time in the Hall of Fame archives. Aristotle's 5 part series on money, TrailGuides analysis and general approval, and the rebuttal by others, especially ORO, was most enlightening. My new insight into the thinking and philosophy of many of theregular participants added a new dimension and appreciation of the forum. The lack of rancor and personal attacks on each others perceived intelligence and perspectives is veryrefreshing in a group with such diverse, varied, and deeply help opinions. The investment of a few hours time is highly recommended to any lurker or newbie.While I can appreciate ORO's and other gold purist position, the reality of what is possible, puts me very solidly in agreement with the perspective of Aristotle and TrailGuide. The American people have voted overwhelmingly in favor of convenience, and are quite willing to pay very handsomely for it. While this fact is without question not the only one, it is a contributing factor to the current dismal price of gold. In reality, very few people care one way or the other at what price it trades; whether or not it trades, nor if it trades on a rigged market. A very large percentage of our citizens recognized long ago that our government has been purchased, lock, stock and barrel, by the law and currency manipulators, and has itself been rigged to favor vast accumulation of un-earned wealth atthe expense of those who actually produce the wealth. This fact has seemingly been accepted with unalterable resignation, thus, one more example of official lawlessnessdraws a yawn, and a "So! What else is new"?As Trail Guide has stated, while gold is indeed a form of money, it is not the only form, and the same may be said of wealth. As many of the contributors have pointed out, health and happiness is also wealth, and in my opinion, more valuable than gold. Although they may not be traded as currency, if either of them is lost, in many instances, not enough currency of any nature exist to restore them. The ultimate wealth however is time, it is irreplaceable and finite; once gone, wealth, in any other form, ceases to exist for that individual. Without the freedom to determine how our time is spent and a right to any proceeds from a transaction, most of us on this forum would consider life to be a prison. Freedom therefore occupies a very high place on the list of what we deem wealth. Common sense dictates therefore, that we must devise a currency system which protects our time and freedom as well as accumulated physical wealth. We may curse, condemn, and pray for its demise, but the fact is irrefutable: The American currency system, for the last 50 years, has served as the most prolific, worldwide wealth producing engine, in the history of mankind.Most of us seem to overlook the fact that every depression this nation has ever experienced, has occurred under the gold standard, with the constitutional money of goldand silver in free circulation, and paper money redeemable one to one for gold or silver coin.. As we are all aware, the system established by the Constitution was abolished bygovernment edict, with criminal penalties for resistors in order to escape the clutches ofthe depression of the 1930s.So why was the 1930's depression so severe? How could a nation possessing so much potential, with every natural resources required for self sufficiency, and gold litterly being picked out of streams, find itself in such dire strates? Yes I know that the bankers, moneymanipulators, and government received most of the blame, and deservedly so. However, several contributing aspects have been overlooked. Not the least was the fact that we hadbeen in almost constant warfare from 1776 until then. How much wealth can a new country accumulate in about 150 years under these circumstances? If it wasn't with foreign governments, it was among ourselves. The War for Independence had been very expensive and fought on credit. The Civil War, in terms of casualties, property damage, divisiveness, and percentage of total wealth diverted, remains the most costly war this nation has every fought. The nations boundaries had beenstretched from coast to coast by the Indian Wars. And the Booze War, fought on the streets, hiways, biways, back alleys, and backwoods, pitting the federal government"police" against legislatively created "criminals", exacted a tremendous price, and was a very recent memory.Our experience with foreign governments had engendered a "we neither need nor desire contact with the rest of the world" persona. We were content to trade among ourselves and let the rest of world get by the best way they could. A coast to coast railroad was our most important achievement. Most of our wealth of natural resources lay untouched and unrecognized.Many citizens had no bank account. Outside the major commerce areas, and secured by private fortune, most of the banks were local, family owned businesses. Their customers consisted primarily of landed gentry and businesses with resources. A large percentage ofthe loans were of the personal nature, based upon probable liquidity of assets, primarily land, buildings, and inventory. Middle class men were providing for families, working for pennies per day. Savings in this nation were virtually non existent. As my father remarked many times, "There is no problem getting a loan, so long as you can prove that you don't need it". Most banks had very little appetite for risk, and unproved technology and ideas represented risk with a capital R. As an example: From its founding, labor unions found it impossible to organize the Ford Motor Co. Because of Henry Fords’ insistence that his employees earn enough money to purchase the product of their labors, the FordMotor Co. pay scale was above the prevailing the wage of the time. This was a glaring exception to the rule. According to bank philosophy of the day, the motor car, (unprovedtechnology) had very little value compared to its cost, thus most refused to finance them. The Ford Motor Co. by financing its cars, demonstrated confidence in its product, the value of technology, faith in the integrity of its employees, and most importantly, THE VALUE OF TIME As a bonus, the expanded market for current technology generatedrevenue required for its future advancements. The Ford Motor Co. prospered. The blooming technology industry of the thirties eventually flowered as part of the war effort,and evolved into the garden in which we now live. Had the rest of the business and banking community of the time been so astute, there would have been no depression. .The depression was caused and perpetuated by the lack of money in the hands of millions of potential customers, possessing nothing but need, desire and near worthlesstime.It took a world war to impart value to time, and since then, with the division of labor, and currency management, productivity and ingenuity has exploded, resulting in the creation of extremely well advanced transportation, communication and recreational equipment in great profusion, at a price most of us can afford, and at the cost of a very modest expenditure of time. Do these houses, cars, boats, computers etc. not count as wealth? Do they not also possess intrinsic value? Can they not be exchanged for other things of intrinsic value? Years ago I heard or read a story of a man who gave each of his two sons $4000.00 in gold coin. The story goes something like this: The first son immediately deposited his into a bank savings account at four percent interest, a good return for the time. The other, son, intrigued by an automobile in an estate sale, purchased the Duesenberg, not for investment, but for transportation. The father almost had a heart attack, and, utilizing the first sons action as an example of the proper use of money, berated the second son for his irresponsibility. Despite the rift with his father, the man took great pride in driving the carand cared for it like a baby. Seduced by automotive advancements over the years, the man owned other cars, but never forsook his first love. As the years wore on, an old man cared for an old Duesenberg, and never lost his sense of pride while driving it. The car was sold after his death for $500,000.00 to settle the estate. Assuming the bank account had appreciated to the same amount, ( highly unlikely) who made the best investment? Lets ad a kicker: The car, although not for sale, is now in a collection, and valued at $3,000,000.00. FRN. A true story? Perhaps. True or false, it serves to demonstrate not only intrinsic value of something other than gold., but the value of human satisfaction andhappiness as well.Our system of gold currency did not have an adequate means of accurately determining the worth of either manufactured, or technological wealth, nor of creating currencyagainst their value. It wasn't until about 1950, that their full value began to be recognized, and, the representative value of paper money added to the economy. This was after the gold based system was abandoned, to be replaced with one based on Gross National Product, the result was called inflation! In the final analysis when an officer of government can create a criminal simply by declaring the money ofaccount, created by the supreme law of the land, to be contraband, then it makes little difference whether the currency is made of gold, paper, or camel dung. Even now, paper currency in inordinate quantity, (as determined by officers of government); in the wrong hands, as determined by these same officers, or in the process of being transported, is routinely confiscated as contraband, and those possessing it are charged with criminal conduct. The same may be said of gold, silver, guns or any other inanimate object of the moment, which the "authorities" chose to criminalize. Obviously the problem is not withthe currency system, it's with the governmental system. Unless that government is staffed by people of integrity, our wealth, as well as our freedom, may be stolen by usurption, inflation, or at gun point, regardless of what circulates as currency. This forums consternation over, and current discussion of the legal qualification of gold whichperhaps would be exempted from confiscation, I think proves the point. Still Perplexed JavaMan (5/25/2000; 15:56:26MT - usagold.com msg#: 31270) Sir SHIFTY, You said..."But instead we are told we must pick one head of the two headed snake. I will no longer."Either will I my friend, as per my Msg ID 31235 post. Watch this country "look the other way" when China moves on Taiwan. It will be interesting to see what spin is put on it to justify or rationalize the event but one thing is for sure, the U.S. may do some hand waving, jaw shaking, and sabre rattling but in the final analysis, we will do nothing of substance except conduct more bu$ine$$. On the issue of gridlock, it seems that its purpose is to prevent any progress from occurring too quickly, if at all. What happened to the line item veto? So much crap gets appended to a bill that causes congressmen to change their vote either for or against it that its practically impossible to figure out where they actually stand on an issue.@aircrew, welcome to the forum. While others here may have more info to share on the subject of numismatics, I was told by one wiser and more experienced than myself that the more common, lower grade coins which sell for less premium are more likely to be surpassed in a rising gold market by the value of their gold content, thus they get melted down. But numismatics that are rare and are of higher grade are like beach-front property during a booming real estate market. They increase in value more than the average property and the premium goes up accordingly. The moral of the story is if one is buying numismatics, buy quality. SHIFTY (5/25/2000; 15:51:58MT - usagold.com msg#: 31269) Food for thought! "A Visitor From The Past" I had a dream the other night, I didn't understand. A figure walking through the mist, with flintlock in his hand. His clothes were torn and dirty, as he stood there by my bed. He took off his three-cornered hat, and speaking low, he said:"We fought a revolution, to secure our liberty. We wrote the Constitution, as a shield from tyranny. For future generations, this legacy we gave. In this, the land of the free and home of the brave."The freedom we secured for you, we hoped you'd always keep. But tyrants labored endlessly while your parents were asleep. Your freedom gone, your courage lost, you're no more than a slave. In this, the land of the free and home of the brave."You buy permits to travel, and permits to own a gun, permits to start a business, or to build a place for one. On land that you believe you own, you pay a yearly rent. Although you have no voice in choosing, how the money's spent."Your children must attend a school that doesn't educate. Your Christian values can't be taught, according to the state. You read about the current news, in a regulated press. You pay a tax you do not owe, to please the I.R.S."Your money is no longer made of Silver or of Gold. You trade your wealth for paper, so your life can be controlled. You pay for crimes that make our Nation, turn from God in shame. You've taken Satan's number, as you've traded in your name."You've given government control, to those who do you harm,so they can padlock churches, and steal the family farm,and keep our country deep in debt, put men of God in jail,and harass your fellow countrymen, while corrupted courts prevail."Your public servants don't uphold the solemn oath they've sworn.Your daughters visit Doctors, so their children won't be born.Your leaders ship artillery and guns to foreign shores,And send your sons to slaughter, fighting other people's wars."Can you regain the freedom for which we fought and died?Or don't you have the courage, or the faith to stand with pride?Are there no more values for which you'll fight to save?Or do you wish your children, live in fear and be a slave?"Sons of the Republic, arise and take a stand!Defend the Constitution, the Supreme Law of the Land!Preserve our Great Republic, and each GOD-Given Right!And pray to GOD, to keep the torch of Freedom burning bright!"As I awoke he vanished, in the mist from whence he came.His words were true, we are not Free, we have ourselves to blame.For even now as tyrants trample each GOD-Given Right,We only watch and tremble, too afraid to stand and fight.If he stood by your bedside, in a dream, while you're asleep,and wonders what remains of our Rights he fought to keep,what would be your answer, if he called out from the grave:"IS THIS STILL THE LAND OF THE FREE AND HOME OF THE BRAVE????"--------------------------------------------------------------------------------Copyright ©1986 Thelen Paulk. All Rights Reserved. SHIFTY (5/25/2000; 15:23:59MT - usagold.com msg#: 31268) Ponzi Correction!! Nasdaq 3,205.35 + Dow 10,323.92 = 13,529.27 divide by 2 = 6764.63 PonziDown 138.35 for an all time low Ponzi! SHIFTY (5/25/2000; 14:55:38MT - usagold.com msg#: 31267) NY Ponzi Nasdaq 3,205.35 + Dow 10,323.92 = 13,529.27 divide by 2 = 6764.63 PonziDown 28.78 a new Ponzi low! lamprey_65 (5/25/2000; 14:50:00MT - usagold.com msg#: 31266) Oswald Actually, Durban Deep's problems stem more from a low gold quote than their hedge book (although I do agree, their hedge is higher than many expect).Deeps is a marginal producer...when POG flops, they flop -- this is the main reason they actually do need more of a hedge than most miners. The current management is working to acquire properties which produce at lower cost.Believe me, if POG were at its historic ratio to the CRB (above $325), Deep shares would be well above the current levels. SHIFTY (5/25/2000; 14:48:27MT - usagold.com msg#: 31265) The Stranger Stranger : The gridlock in DC is so the little people think there is a difference .Watch what they do , not what they say. We have been hearing about campaign finance reform since Perot brought it to the attention of the American people. That was 1992 ,and we still hear how they want to reform campaign finance as they take money by the train load from corporations that have no allegiance to any country. I fear that the media is in bed with both parties and do not wish to wake the sleeping giant( the American people ) so they spin and they spin and tell us all that a third party cant win. The American people should have a hard time deciding who to vote for because all the candidates are so good. But instead we are told we must pick one head of the two headed snake.I will no longer.I came inside from working on my truck in 98 degree heat , looked at the price of gold being pushed down this afternoon, and decided to pop over here to see what was being said about it and saw your post were you said:"Go back to your encyclopedia, Lamprey, and read again about the Luddites in 19th Century England. The fear these craftsmen had of the industrial revolution caused them to run about sabotaging factories and machinery. They didn't understand (or didn't WANT to understand) that cheaper means of production free up capital, which creates demand for new products, new industries, and ultimately a higher standard of living for all. Think of what we would be missing had we listened to them back then. Yet their's was almost precisely the ground upon which you base your argument today." That on top of the China sellout just pushed me over the top! I have had enough of being sold down the river by politicians, and I hope to God I'm not alone! Oswald Murphy (5/25/2000; 14:38:47MT - usagold.com msg#: 31264) Greenspan getting senile? lamprey_65 Indeed, IMHO. I wonder who will take care of Andrea. She is still a "Cat on a hot tin roof."Send King Bubba to the rescue. Oswald Murphy (5/25/2000; 14:29:45MT - usagold.com msg#: 31263) Durban Roodepoort Deep, Ltd. Contrary to what other people have published in some other gold forums, Drooy, is highly hedged. According to their own hedge book as of 03 May 2000, their Year Ended April 00/Jun 00 is 51% hedged and 55% committed.Drooy's stock is reflecting their heavy hedging by being flushed down the drain. Today, reached a low of 29/32. I alarmed the people when the stock was around 2 1/4.I feel sorry for Joe Calamari and those who fell in the trap. My deepest regards for those in deep agony. They should have listened to me when I posted, "stay away from Drooy." After that, I was stabbed to death by their pushers. Trail Guide (5/25/2000; 14:21:55MT - usagold.com msg#: 31262) Comment Hello again ORO Great post! A few comments:-----------ORO (5/25/2000; 6:21:15MT - usagold.com msg#: 31228)BTD, TC, TG, Solomon - gold and paper The paper markets provide an investor with a means to play the price of gold. They do not reflect directly the availability of gold, just the availability of paper obligations denominated in gold. ---------------------Your part above brought me back to a subject I only touched on before. When all the gold loans were a big rage a year ot two ago, no one really bothered to confirm if the loan money the mines got really came from "sold gold". The media and Bullion houses said it was, but was it? The price said it was, but did the price fall from physical selling or was it just some physical and mostly paper derivatives?You know, the original typical unconvoluted mine loan. The BB borrows gold, sells it and they and the mine control the account where the money from the sale is placed. Some people think the BB just gives the mine the money for it's own use, but then the mine would owe the BB both cash and gold bars. No, the mine owes the BB only gold bars. They usually jointly invest the cash from the gold loan sale until it's used to buy the newly mined gold that's returned to the lender. Correct me if I'm wrong, but the mines don't hold any confirming documents that absolutely state that a real physical gold sale produced the cash collateral. Could you imagine a miner demanding such a document as a condition for a gold loan (smile). I think someone should check into this! No?You see, this cash could come from someone's account, a loan, official entity or official government source? I bet some of this money wanted to actually receive gold for the cash (oil?). But most of it just wanted to stimulate (expand) the paper gold supply. From this view the gold loan isn't the rainman, is it? The profit for the banks comes from selling the derivatives to create a channel for new mined gold. As the price falls, the derivatives grow fat. The gold loan cash doesn't have to be generated by real gold moved from a vault and sold. Even though a CB is involved as backup. Once this cash is introduced into the deal as collateral, the BB is obligated to cover his position if the mined gold is not wanted. Not by going long gold derivatives, rather by selling gold short. All in an effort to create an avenue to send the gold down if the gold loan ever starts paying down instead of rolling over. During this time, the more funds available from investors or fractional reserve banking, the more gold paper is sold, the lower the lease rate, the more paper gold is expanded. Why, almost anyone could borrow gold cash in this fashion. For someone wanting paper gold to fall, it was like "money in the bank". I don't think there is much lending against the lease rate now as rates reflect a diminished market. But who needs it? Everyone has learned to just sell the derivatives outright. This won't last much longer.I bet if someone went to a willing mine, they could find gold. Not in the shaft, on the books!Just thinking out loud.more on your full postTrail Guide lamprey_65 (5/25/2000; 14:18:23MT - usagold.com msg#: 31261) Oswald I saw that exchange between Paul and Greenspan a few months ago...and yes, he stated clearly that they have no clue about money supply! You should have seen Paul's reaction! Rep. Paul is one of the few people in Congress I can say I truly respect -- he's on top of the Fed's shenanigans.This was also the testimony where Greenie jokes about being more concerned about deflation than inflation. The guys is getting senile, I think. lamprey_65 (5/25/2000; 14:14:11MT - usagold.com msg#: 31260) Wages I expect the latest wage data to be very negative for the market, i.e. wages going up. I'm seeing wages in my neck of the woods (New England) exploding to the upside now...just got word of a $2 an hour increase in wages at one of the highest paying blue-collar employers in Southern N.H. -- they are DESPARATE for workers.Hold on Gold holders, reality will begin to sink in very soon in regards to inflation -- and the dollar's fall will only make matters worse. Oswald Murphy (5/25/2000; 14:13:22MT - usagold.com msg#: 31259) Greenspan is confused and rightly so http://www.fame.org/whatsnew.asp In a recent exchange with Congressman Ron Paul, MD, a member of the HouseBanking Committee and a member of FAME's Board of Advisors, Federal ReserveChairman Alan Greenspan lapsed into clarity and declared that he cannotdefine nor manage the nation's money! This is yet another example of a"press failure." The exchange was not reported in the establishment media.Read about it, along with Dr. Paul's views about gold, in Jay Taylor'sinterview with Mr. Greenspan. The interview appears in the What's New section of FAME's website.Just click on: http://www.fame.org/whatsnew.asp Al Fulchino (5/25/2000; 14:06:10MT - usagold.com msg#: 31258) TC/TG/Stranger/BTD/Goldhunter etc etc etc These are great exchanges. Appreciation on behalf of all, I am sure. TheStranger (5/25/2000; 14:00:24MT - usagold.com msg#: 31257) Elwood I just reread your first post to me, and I realize I didn't give your thought the attention it deserved. In a sense I was underestimating you, and I apologize. Welcome to my sphere of awareness. I wish I had recognized you sooner. TheStranger (5/25/2000; 13:46:49MT - usagold.com msg#: 31256) Elwood Sorry. I probably misunderstood you. I thought you were saying the "grow or die" imperitive exists primarily because of monetary debasement. My point was that many thousands of businesses that chose not to grow have died, not because of monetary debasement but because someone else, like McDonalds for example, did choose to grow and wound up snatching their markets away. TheStranger (5/25/2000; 13:37:46MT - usagold.com msg#: 31255) Farfel, Shifty and Trail Guide Farfel - You are one smart Eli. Your call for an abortive China-vote bounce was right on the money, brother.Shifty - I am not a Republican, though I understand why you drew the conclusion. Your post does bring one question to mind however. If, as you say, there is no difference between the two parties, how come they are so frequently gridlocked? Is it possible you have become so disinchanted that you aren't paying very close attention anymore? Seriously though, if I made some point in my post with which you particularly disagree, I will be very happy to respond.Trail Guide - if any of us ever get out of this quagmire with a profit, I would hasten to hug you. If I only knew where you are. Elwood (5/25/2000; 13:24:12MT - usagold.com msg#: 31254) TheStranger (5/25/2000; 12:46:33MT - usagold.com msg#: 31248) "Elwood - try that argument out on all the Moms and Pops that have been put to death by the likes of Mcdonalds orStaples or 7-Eleven in the last few decades. Your point about monetary debasement is well taken, but I think yourimage of the marketplace is a little narrow. Thanks."Stranger, sorry, I don't follow. Are you saying that the inflationary policies of the powers that be are there to benefit the Mom and Pops that failed to change? Or are you saying that the Mom and Pops that grew to become the McDonalds, Staples and 7-Elevens are now somehow bad because their existence threatens those who are unable to compete with them?What reason is there to "try that argument out" on anyone? What is, is what is. Technological change is a fact of life. Those who fail to use it will be disadvantaged relative to those who don't. This is without regard to the type of monetary system in use.Elwood Leland (5/25/2000; 13:16:25MT - usagold.com msg#: 31253) John Hathaway's Latest... http://www.tocqueville.com/brainstorms/printbrainstorm0067.html . Trail Guide (5/25/2000; 13:08:59MT - usagold.com msg#: 31252) Comment Leigh (5/25/2000; 12:49:39MT - usagold.com msg#: 31249)aircrewHello Leigh and welcome also "aircrew"!Thanks Leigh, for pointing out those past discussions. Yes, a rounded coin holding is very good for most people, myself included. The old world coins may do very well if they are frozen out of the trading marketplace because of their art appeal and non- Legal Tender status. I even thought of comparing Stranger's NEM against the performance of the 20 Marks, MK offered. But I am unsure of my personal outcome. You see, if the 20 Marks beat out NEM, Stranger will come after me with an "AX". But, if NEM wins, he will try to hug me! I'll be in a bad position either way (big smile)!PH and ORO, just a minute.thanksTrail Guide SHIFTY (5/25/2000; 13:02:24MT - usagold.com msg#: 31251) The Stranger The Stranger : I think its time you smelled the coffee. China is not going to change. The citizens of the USA have been sold out once again by the politicians in DC ( District of Criminals) ! You Sound like a republican to me. I was one till I saw that there is no difference between the two parties. I hear the same global nonsense from both mainstream parties. The Democrats tax and spend, the republicans borrow and spend. The citizens of the USA had better wake up or they will find themselves hoping to get one of those 3 cent per hour jobs of the new global economy. Our representatives don't represent us. They represent the global corporations. The global corporations want cheep labor. A worker with a mortgage , car payment, homeowners insurance, utility bills ect has no place in the New Global Economy! They just don't know it yet. All they hear is Let them eat cake and they think they are actually going to get some. Wake up America and clean out the barn and make America great again. Think of Valley Forge and bloody footprints in the snow. The people that think China is so wonderful should move there and stay .PS Don't let the door hit you in the *ss on the was out!$hifty Trail Guide (5/25/2000; 12:51:58MT - usagold.com msg#: 31250) Comment goldhunter (5/25/2000; 5:05:29MT - usagold.com msg#: 31225)Trail Guide Mkr #1Sir Guide...Apples to apples I do repeat...You can say you sold your Krands for $270.00 (a fair value?)for the day...Is that ALL you could get?...I read your post yest. in response to BTD, but to beFAIR, the "local price" from the vault was "$282.00 per coin" as I checked with CPM Inc. rightafter the store started for the day...Here in lies the Small problem...You could only "get" $270 but a comparison "purchase" costs $282...Is it not more truthful to have "bought both" yesterday AM.and see how the dust settles in thefuture on a total equity worth basis? I offered Dec1 as a practical window of time...Once again, The "buy" price of our physical contrasted with the "buy" price of our futures will give a fair and honest comparison of the two (in my opinion, related)"investments.You try and stack the deck in your favor by using the "sell price" of $270...and then using this as your "basis"...That isn't right for this comparison...Hello GoldhunterI read you the first time. Understand, I'm not doing this for your benefit nor do I follow your rules. This is a real life demonstration done in a simple "rounded out fashion" "by me" and for the benefit of the average investor watching. Most of these people (thousands I believe) read my talks while they are using a good helping of their common sense. They know how to read between the lines and figure things for themselves. As an example I believe all of them knew that Dec futures didn't close at $383 as I mis typed yesterday. They can also read my extremely poor English usage (smile).BTD didn't offer any physical sell price or future buy price in his post. That's why I wanted to mark my trade close to the market for all to see. Your quibbling about my price to sell these K-rands is small change to me and even smaller to these readers who are looking for a big picture. I know they will not accept if someone nickel and dimes a trade to prove a point. Truly, if my exercise doesn't completely overwhelm your difference, I'll present it as a paper win. Also: This whole exchange was never an effort to pick on BTD or fault his physical position change into futures. As I said, using leverage is how most Westerners play the game. The problem is the concept always falls out of context because everyone touts a trade but never fully follows up with a general outline of their position. Or when they leave it. Everyone here has some perception of my capacity to own gold and general entry points. By simple extension the average thinker knows I'm huge, big time, "world class down" in dollar terms. Yet, I am comfortable because I understand it's future and proclaim where we are all going with it. Gold is a "percentage of my wealth" savings to me, not a trade. I will see out distance every other investment in time.Yourself Goldhunter is a good example. You declare to hold Eagles and trade futures. You also commented in your above post to me about being truthful, fair and honest. How about giving these people a position that lasts longer than a few months? If you make a living as a futures broker and trading is where it's at, take us on a hike (smile)?thanks Trail Guide Leigh (5/25/2000; 12:49:39MT - usagold.com msg#: 31249) aircrew Dear aircrew: Welcome! Trail Guide/FOA and ANOTHER have written about coins a number of times. Have you read through ANOTHER(THOUGHTS!), which can be accessed through the Gold Trail page? At one point ANOTHER writes about how bullion coins (Eagles, Maples, and such) are the "good hold," but that numismatic coins (Roosters, Angels, 20 Marks, etc.) are valuable for their "artwork" as well as their gold content (and historical significance, I might add).A couple of months ago Trail Guide discussed the possibility that "legal tender" coins could be confiscated under extreme circumstances. That led some to consider whether bars or rounds would be a safer investment.The topics of gold vs. silver vs. platinum, and coins vs. bars are ongoing around here. Even if you've been lurking for a while, you might want to reread some of the Archives.I've tried to diversify among my precious metals, in the hope that if one venue is rendered less valuable, another will soar. TheStranger (5/25/2000; 12:46:33MT - usagold.com msg#: 31248) Elwood and Java Man Elwood - try that argument out on all the Moms and Pops that have been put to death by the likes of Mcdonalds or Staples or 7-Eleven in the last few decades. Your point about monetary debasement is well taken, but I think your image of the marketplace is a little narrow. Thanks.Java Man - Yessir. That is also a means of moving up the food chain, and many companies have accomplished precisely that. Nuccor Steel comes to mind. lamprey_65 (5/25/2000; 12:45:51MT - usagold.com msg#: 31247) TheStranger I guess we'll just have to agree to disagree on this one. One last observation...I followed the Soviet Union for many years as an analyst for the government -- they too have ALWAYS had the necessesities for creating a vibrant free market economy...everything that is except for true freedom. The mulit-national corporations are facilitating the facade in China which will continue...make no mistake, the Chinese Communists NEVER would have agreed to the current situation if they thought it would do them harm, and the military in that country will prosper, not die on the vine as some would suggest. Once Russia and China form the closer alliance which is in both's best interest, the U.S. will be left out in the cold.Like I said, we've already been sold down the river -- yesterday's vote was merely doing away with the facade.These are my last words on the topic...I thank the forum for allowing the off-topic posts -- I do carry strong feelings on this issue.Lamprey Netking (5/25/2000; 12:43:38MT - usagold.com msg#: 31246) Mr Goldhunter Goldhunter - In your own professional opinion Sir, how quickly & to what extent would the price of gold(paper) have to rise before risk of default was a real possibility for Comex participants & commercial intermediaries? jinx44 (5/25/2000; 12:36:21MT - usagold.com msg#: 31245) Gold tanking I am glad to see gold dropping hard (down about $5). If the cabal can drop it into the low 60's or 50's, they will nail some more shorts if the EEC makes another WA type move. Given the euro flopping about so low and gold being hit significantly below the 280 mark, that may spur Europe to get mean with the BB's and double reserves or force the euro carry-traders to cover. I think that would be good for gold. Elwood (5/25/2000; 12:25:46MT - usagold.com msg#: 31244) TheStranger (5/25/2000; 11:02:39MT - usagold.com msg#: 31236) Stranger, the need to grow or die arises because inflation through monetary debasement is a tax on capital. Left alone, the technological advance that arises from market competition would, in fact, produce gains from an economy or a firm which didn't "grow." That is, the price reductions of computer technology we've seen over the past generation would be extended across the production structure resulting in lower rather than stable or slightly increasing consumer prices.The difference between consumer prices now and what they would have been were they allowed to fall represents a real transfer of wealth from the producers (consumers) to the beneficiaries of the policy of monetary debasement through credit expansion.Elwood TheStranger (5/25/2000; 12:22:27MT - usagold.com msg#: 31243) Lamprey Go back to your encyclopedia, Lamprey, and read again about the Luddites in 19th Century England. The fear these craftsmen had of the industrial revolution caused them to run about sabotaging factories and machinery. They didn't understand (or didn't WANT to understand) that cheaper means of production free up capital, which creates demand for new products, new industries, and ultimately a higher standard of living for all. Think of what we would be missing had we listened to them back then. Yet their's was almost precisely the ground upon which you base your argument today.As to recession: Yes we will have one one day, and, as usual, money creation will get us out of it. (You'd think that alone might augur well for gold). Meantime, American private debt is still well below extremes reached in the 1980s (for example) and the public national debt, as a function of overall economic activity, is nowhere near previous historical extremes. And it is shrinking!As to China: Capitalism only works as well as it does when it protects the valid claim of each practitioner to the fruits of his own enterprise. Such protection in China will always be sporadic at best until representative democracy and basic human rights are guaranteed to all. For this reason, China is a long way off from ever achieving the kind of productivity we have in the United States. So I wouldn't lie awake nights worrying if I were you. Of course, if these hallmarks of democracy ever should come to China, the whole world will be better off. For, as things presently stand, the average Chinaman doesn't create much wealth for anybody. JavaMan (5/25/2000; 11:42:56MT - usagold.com msg#: 31242) Sir Stranger, your msg ID 31236... ...But capitalism means competition, and in any competitive environment, one must either grow or die. There is no standing still....if you want to live better than a Guatemalan (for example) you are going to have to produce more value than a Guatemalan. You can do that either by working longer hours than he does or by moving higher up on the food chain. JavaMan: I agree, there is no standing still so lets consider a third alternative, working smarter. This is how we can maintain a competivite advantage and live better thant the Guatamalan (for example). lamprey_65 (5/25/2000; 11:38:09MT - usagold.com msg#: 31241) Further... The Chinese have the manpower, resources, and technical expertise to develop their own internal economic miracle. Why haven't they?...Their government has not allowed the one missing ingredient - true freedom. So now, instead of allowing enough freedom for their economy to truly prosper on its own (this would endanger the Communist Government), they instead allow just enough freedom so that their people can make and export products in a controlled environment...the Chinese government and the multi-national corporations are the biggest winners (and those at the top of both pyramids are the true winners). Everyone else is expendable. Henri (5/25/2000; 11:22:43MT - usagold.com msg#: 31240) Holtzman Do you keep a towel handy as well? To signal a passing spaceship for a ride? I do. lamprey_65 (5/25/2000; 11:21:26MT - usagold.com msg#: 31239) TheStranger This is the great argument - whether local production in the developed countries has a place in today's world economy. My bet is we will see the negative effects when the eventual U.S. recession hits (we are way overdue for one). I ask you Sir, how do you propose for us to get out of the next recession -- more government spending? exports? We've crushed both possibilities - the first through our enourmous current debt and the second by allowing corporations to send so many manufacturing jobs overseas. Once the recession hits, service-related jobs will be the first to be eliminated as they are the most expendable. Where will we find the jobs to take their place? Remember, the Chinese will still work for less in a world recession which will only accelerate the export of U.S. jobs as corporate profits come under pressure.As I said, it will become apparent how we've screwed ourselves once the economy goes sour...until then, everyone is fat, dumb, and happy. TheStranger (5/25/2000; 11:20:20MT - usagold.com msg#: 31238) I Had To Laugh I had to laugh when I read BTD's tirade against prognosticators the other day. I suppose one would be able to divine the future were he possessed of omniscience. For this reason, it makes sense that we spend our lives acquiring knowledge. It's obvious we will never foresee everything in our future. But isn't it axiomatic that the more our understanding grows, the more prescient we are likely to become? And where do we turn for this understanding if not to those who are brighter than ourselves?So why did I have to laugh at BTD? Because I have been predicting higher gold prices in this forum for over a year now, and I have been wrong, wrong, wrong. Absolutely Wrong! Geez! I hope no one was listening. aircrew (5/25/2000; 11:14:33MT - usagold.com msg#: 31237) On being a PGA--bullion vs numismatic I've been lurking here lo these many months and have decided to test out my spiffy new userid and password. I've read as much of FOA/Trail Guide's ruminations as I've been able to find here but I've only seen one reference to coins, that being his recent "conversion" of his K-Rands. MK has numismatic type coins, as well as bullion coins available for sale. What are the pros and cons of both sides? POS (Poor Old Solomon 05/24/00; 21:46:23MT - usagold.com msg#: 31208) laid out a cogent thesis for having silver (but in what form Solomon?) Can anyone else offer an opinion on coins that is as well thought out? TIA. TheStranger (5/25/2000; 11:02:39MT - usagold.com msg#: 31236) For Perhaps The First Time Ever, I Disagree With You, Lamprey Capitalism dominates the world economy because it creates more wealth for more people than any other system which has ever been tried. But capitalism means competition, and in any competitive environment, one must either grow or die. There is no standing still.It is a credit to our leaders (you won't hear me say that very often) that they understand this fundamental point: In the final analysis, if you want to live better than a Guatemalan (for example) you are going to have to produce more value than a Guatemalan. You can do that either by working longer hours than he does or by moving higher up on the food chain. In the United States, good jobs go begging every day because those who otherwise might have been hired have failed to adequately educate themselves. What you call a "social contract" would be nothing more than a warm and fuzzy, but very misguided, effort to mitigate improved standards of living for all in order to help such people cling to a past which no longer exists anyway. No, I am afraid not. Far better we should remind ourselves of what our fathers told us so many years ago, "Nobody owes you a living." JavaMan (5/25/2000; 10:40:20MT - usagold.com msg#: 31235) lamprey_65, WAC... WAC, you said..."I blame not the American people for this dilemma. The question as to be asked, why do the leaders in China allow their own people to be enslaved?"Let's take your thinking a step further and ask...why do American leaders choose to do business with a country who's leaders allow their own people to be enslaved? Not to mention the rest of the human rights violations they are guilty of. And while the American leaders choose to do this, it seems the American people (who elect them) look the other way because "its good for the economy." We, as a nation, are selling out at the speed of light, as long as the old portfolio keeps growing, and if the American people are not to blame, then who is? I made my mind up this week that even though I've been a registered Republican for thirty years, I will never vote the Republican ticket again (and the Democrats are just as guilty). Holtzman (5/25/2000; 10:28:35MT - usagold.com msg#: 31234) Holding versus betting Holtzman here,Reaching back in time to an equine analogy which has suddenly become appropriate again, the manager of Cheltenham Racecourse, and the auctioneer at Tattersalls, are not in competition with one another. Customers come to Cheltenham in order to place wagers on horseraces with hopes of acquiring cash, whilst customers come to Tattersalls with hopes of acquiring horses (some of whom intend to later resell their horses for cash).Some customers of each establishment will profit, whilst other customers of each will not. Also, a small number of customers come to both establishments because neither on its own provides the total solution they feel they require.The way in which each of us views Risk seems to play a part in this. Which is the riskier proposition: to own physical gold, or to play the futures markets?I should venture to say that TownCrier does not proselytise the benefits of physical gold on account of it being his job to do so. Rather, I suspect that he took his job (and continues to remain in his job) because of his pre-existing strongly held belief that precious metals are an insurance policy everyone should own.Meanwhile, I should venture to say that goldhunter remains in his career as a futures broker because he genuinely feels that keeping one's wealth "in play" is the most efficient use of same.Both of you have history on your side. Since well before the parable of the Talents, there have been many periods when active investment far and away outperformed the hoarding of one's wealth. Most recently, the past twenty or so years have been such a period. However, there have been many other periods in history when the only investors left standing were the ones who had at least a part of their wealth squirreled away for just such emergencies. Most recently, as ORO just pointed out, holders of physical palladium have fared better than holders of TOCOM contracts. A year or so ago, residents of Kosovo (on either side) who held portable wealth were more likely to have outperformed residents who owned real estate.goldhunter's argument falls along the lines of reaching for the maximum possible return ON one's investment. To do otherwise, I'm sure he feels, is to fail to keep up with the economy.TownCrier's argument falls along the lines of doing one's best to assure that there will be a return OF one's investment. To do otherwise, I'm sure he feels, is to risk going down with the present economic bubble.Both are valid arguments, and both have their day in the sun. It's just that the two arguments seldom see the sun at the same time. For the past twenty years, presumably most of goldhunter's adult lifespan, his argument has been carrying the day, whilst TownCrier's argument has been painfully losing ground. However, that's no reason to assume this trend will continue forever. Beware linear thinking in a cyclical world. But also beware of allowing yourself to believe that you know when the cycle is due to reverse.I imagine that's why BTD still holds 4/7 of his commodities wealth as physical: he doesn't want to be left out of the present trend's benefit stream, yet he doesn't want to be annihilated should the trend unexpectedly reverse on him. Indeed, BTD's desire to diversify his holdings is something I've been advocating since I first began posting here.For myself, however, I have not (and most likely will not) ever wager even a small part of my holdings in the futures markets, whether on gold or on pork bellies. But then again, I don't place wagers at Cheltenham, either. I believe in owning rather than in betting, but I don't own all of any one thing. I own physical gold, but I also own gold mining stocks, and I own fiat currencies, I own stocks not involved in mining, and so forth. My holdings in euros haven't done so well this past year. My holdings in dollars have done wonderfully... so far.And my physical gold holdings, as viewed in terms of British pounds, have appreciated respectably over the past year.As an aside to those dollar-centric posters who in past weeks have been bemoaning the renewed fall of POG, I should point out that it is only in terms of U.S. dollars that gold is in fact falling. From the point of view of a Concorde passenger, an Airbus A300 appears to be falling behind, but the dollar isn't going to perform like a Concorde forever. And when that changes, euphoria will return to the hearts of goldbugs who cannot help but judge their own success in terms of dollars. As Douglas Adams advises, Don't Panic.Yours,I.V. Holtzman lamprey_65 (5/25/2000; 10:12:49MT - usagold.com msg#: 31233) WAC I share your views on the China issue. This vote yesterday was just the final nail in the coffin for the U.S. blue collar worker...the truth is they were sacrificed years ago in the name of greater compensation for the upper-level corporate types. The politicians sided with the corporations for re-election purposes ($$$).Where is the social contract in this country? I don't see one anymore...the new religion is "whatever is cheapest is best" -- well, that does not work in a recession or depression. How can a service-based economy pull itself out of hard times? We sure won't be able to export our way out, that's for sure. YGM (5/25/2000; 10:10:36MT - usagold.com msg#: 31232) Futures & Options Quite Simple Really... The Future is Gold and the Option is Own it or Don't....I've never heard anyone say Gold- It's not worth the PAPER it's printed on, but we soon may hear just that....I do know this and it's not negotiable to my mind.....As long as I live I'll trust no mans paper, regardless of what he prints on it......History will repeat and will suffer heretofore unthinkable changes.......These are truly uncertain times or have you noticed while being blinded by all the imaginary wealth and euphoria created by a corrupt and bankrupt system......GO GATA and GO PHYSICAL GOLD....YGM. USAGOLD (5/25/2000; 8:30:29MT - usagold.com msg#: 31231) Today's Market Report: Markets Off to Quiet Start Despite Inflationary Growth Report http://www.usagold.com/Order_Form.html 5/25/00 Indications Current Change Gold June Comex 273.30 -0.50 Silver July Comex 5.01 nc 30 Yr TBond June CBOT 93~15 -0~07 Dollar Index June NYBOT 111.60 +0.48 Market Report (5/25/00): Gold was essentially sideways this morning as the dollar firmed and the Commerce Department reported a strong 5.4% consumer-led annualized growth rate -- well ahead of the 3.5 to 4% rate that the Fed believes can be sustained without igniting inflation. The markets will likely read this as more grist for the inflation mill though the reaction thus far has been subdued. The dollar gained impetus from the European Central Bank decision to keep euro interest rates steady leaving the Fed .5% rise unanswered. The euro was down about a half cent in the early going. The Dow and government paper markets' reaction to all this, like gold's, was muted in the early going. The Asian and European gold markets were quiet overnight with traders looking around for direction. "At the moment no-one knows if it's going to be pushed lower or just left where it is, so it's safer to stand back and wait," a source told FWN. There was light physical buying at lows preventing the metal from breaking through the $272 level, but otherwise trading seemed to be quiet in advance of the upcoming long holiday weekend in the U.S. All in all, it looks like the markets at least from the early evidence have decided to take the day off despite the inflation news. Have a good day, fellow goldmeisters. See you back here tomorrow.If you would like to receive an information packet which includes our newsletter on the gold market plus Gold Almanac 2000, please click on the link above. Laura (5/25/2000; 7:57:49MT - usagold.com msg#: 31230) Wheat and Corn threatened http://www.vny.com/cf/News/upidetail.cfm?QID=88174 The touch of death is never gentle. Christopher (5/25/2000; 7:34:03MT - usagold.com msg#: 31229) Al Fulchino re: HI-HAT Hey Al, Sounds like HI-HAT's back forty needs detecting (BIIIIG SMILE)To the giants of this forum: Many times I sit here and read what is offered with little understanding and tardy comprehension. It is true that the school system never taught economics like that which is bantered about this place with such easy familiarity. It is truly awe inspiring. And humbling as I walk at the very end of the line on the Trail. But walk I do though to most it is but a crawl. I just wanted to offer my appreciation to the threads of the past few days. The entertainment factor has been Wonderful, and the education factor has been incalculable. I was thinking the other day about how much money I had "spent" on Gold purchases in the last year and as my mind mulled over the amount it dawned on me that I was thinking about it in the wrong way. I had not "spent" that money on Gold, I had more truthfully exchanged it for Gold, and that if the need arose I could exchange it back into any brand of paper that I wanted and that was most facilitative of my needs at that particular time. I did not have to go to the bank and get their permission to do so, or fear any intervention from any government branch. The government will not call me next week and ask me to turn my "old gold" for the new and approved counterfeit-safe note. It is MINE to do with as I see fit. It is real.It is solid. It doesn't fade when it gets washed. I guess, most of all it is comforting when all around me is in turmoil. It sits there in the midst of the storm and says "What, me worry?" And yes like HI-HAT alludes, it is treasure. What a feeling it must be to open your closet and be avalanched by K-Rands. Sorry for the interruption teacher, just ruminations from a student at the back of the class. Teach on! ORO (5/25/2000; 6:21:15MT - usagold.com msg#: 31228) BTD, TC, TG, Solomon - gold and paper The paper markets provide an investor with a means to play the price of gold. They do not reflect directly the availability of gold, just the availability of paper obligations denominated in gold. As such, the gold prices discovered by these markets are detached from the reality of gold supplies. The price of gold in these markets is the value of a fiduciary gold. The only mechanism for the connection of the gold price to its supply and demand fundumentals is arbitrage. The whole purpose of owning gold long term has been to avoid fiduciary exposure. The gold holder wants to be relieved of the exposure to bad debt that a bank or a government may produce.The holding of paper gold does not protect the holder from fiduciary default. The futures contracts are on shifting sands, there is the demonstration of the TOCOM Pd contract before us. It had failed to deliver Pd and the contract market settled in cash. During the settlement period there was no Pd to be had from refiners beyond fulfillment of existing long term contracts. Immediate delivery brought a premium of some 15%, and up to 20% over the settlement prices. In terms of Pd delivered, the futures contract had a loss of 15% - while the markets in the rest of the world were still functioning, what would the result have been if the markets were not functioning elsewhere? 50% premiums?In a market much larger than Pd, gold paper will settle in a liquidity crissis in just the same way. There will be premiums of 50%, 100%, who knows. While Pd is not what people go into in times of market chaos, gold - physical gold - is. Premiums to settlement prices may be so much greater than the settlement price that the gold investor who replaced gold purchases with paper gold would not see any of the rewards of holding gold. Exposure to bad debt is maintained, exposure to market chaos is maintained, and the arbitrary settlement prices reached in the paper markets will not buy the physical gold once the funds are in the investor's hands.To invest in paper gold is to incur the same risks of dollar investments. While the the dollar inflation may be hedged, the parallel fiduciary gold inflation is not. Furthermore, none of the default potential of the credit markets is alleviated. In addition to the credit market default risk, there is the risk of default that is peculiar to the gold markets due to the fact that no lender of last resort exists.In short, if you are investing in gold as insurance against a chaotic market that craters credit quality and causes a rush to physical assets, paper gold provides no more than 10% of the protection you seek, while increasing your risk by introducing an additional mode for market failure going against you.If you want to make use of the leverage of the markets, buy now what everyone OWES, buy now what all will seek when those who OWE can not DELIVER.Banking, by its definition, is in a constant state of insolvency. Historically, the gold banking system (which until 1933 was the whole of banking, and until 1971 was the whole of international banking) fails when leverage exceeds a factor of 4. In 1929-1933, US gold leverage was at a factor of 26. Gold contracts were defaulted on by banks with the full support of the government. The removal of denomination of the contracts in gold within the US, deleveraged the accounts to a factor of 1.6 (60% reserves) for the foreign holder of US gold obligations who had retained the right to redeem his gold.Now, for a philosophical question: do you believe the US dollar, a debt currency, is the true bassis of the international trading system? If so, go ahead and think in terms of denominating your ultimate profits and balance sheet position in these terms.I, for one, found that the dollar is not at all at the center of the trading system, but is an intermediary to the center - standing between the seller of goods and services and his payment in gold. This system had been constructed to prevent the running of the nominal amounts of trade through gold, leaving only the accumulation of profit to weigh on the demand for gold. Not having gold circulating directly for settlement of trade, the market price of gold is reduced because there is no need to hold large cash balances of gold for trade. The only balances necessary are those for the net profit margin, which is in the range of 5% to 10% of the volume of trade. Having diverted 90-95% of the demand for gold cash balances, the maker of large scale profits can buy gold at a proportional discount (90-95%) to its full monetary value as long as the system functions. In order to protect against short term moves in currency values, the merchant trader uses shorter term holdings in paper gold to protect his receivables, from which his profits will be taken when the obligations on these receivables are deducted. The profits will eventually be put into physical holdings.If the system is not functional, as it is bound to become, then the merchant trader would tend to put the whole of the balance of his receivables into physical gold. At the peak of this process, the price of gold would rise well above the full monetary value - which is now 20 fold higher (according to the proportionality of profit and revenue). It will show the full value of gold as the replacement of all currencies in the practices of trade. Since the price of gold production rises with the volumes of production required, the top limit to price would rise well above the 20 fold proportion. The next limiting factor is the value of gold cash balances as full replacement for fiduciary media and other financial assets. The ultimate currency price of gold would allow for the whole of the purchasing power of currency denominated assets (cash currency balances, bonds, stocks) to move into gold. These balances stand today at 85 trillion dollars. Ultimately, this balance of purchasing power will be transferred into the available gold. At 4 billion ounces above ground today, and at 4.5-5 billion ounces being available within the next 5-10 years, this ammounts to an ultimate gold price of over $20,000 dollars, assuming no price inflation. Over this same period of 5-10 years, the price inflation is likely to be substantial, a double or triple in prices is likely, in some currencies it would be likely to be 5-10 fold. For the dollar, an equalization with purchasing power parities at a positive trade balance, dollar region prices would need to rise 3-5 fold relative to other currencies; 3 fold for PPP balance, 5 fold to induce a trade surpus proportional to the current trade deficit. So, BTD, the choice is yours as to whether you would believe that the assignat, oops, dollar will buy the same ammount of gold when you are settled for cash and seek the old Krugs when you have the cash in hand a few days later. I would imagine that the same conditions that would cause the cash settlement, would also cause a near instantaneous rise in Krugs and Eagles to the same level that would prevent the people who were settled in cash from being able to buy the coins and bars with their cash. The supply of the physical gold would not magically grow to match the sudden demand from the people who received cash settlements from the exchanges and banks - which would happen all at once.You see, BTD, like Aragorn's "thunder in the night", the occasion of cash settlement would be an instantaneous event. It would be that moment in time when a bar of gold was not delivered to the gold account holder at the bank counter because there were no gold bars in the bank at all, and there were no gold bars to be had from the other banks either, so that the seeker of delivery could not be sent to another bank. That moment of the last bar of available reserves leaving the bank vault is an infinitesimal instant of time. The conditions of the market before and after this event are completely different. In electronic time, it would be a simultaneous total collapse. The few days needed to get cash settlement - usually 5 days - but the law allows up to 2 weeks for local settlement and up to 3 weeks for international settlement, would be sufficient to make sure that no one will manage to get more than a couple of grams per contracted ounce. The break in the chain of parity (dollar=paper gold=gold) will occur at the two points of parity at the same time. Such events, in history, have been momentous, and the results were very quick to arrive. With more leverage than ever before, they results will be that much greater, and that much closer to instantaneous. Black Blade (5/25/2000; 6:03:33MT - usagold.com msg#: 31227) Morning Wakeup Call! Asia Precious Metals Review: Profit-taking caps platinum By Hiroyuki Fujiwara, Bridge News Tokyo--May 25--Massive profit-taking capped spot platinum on Thursday in Asia after prices reached February's high of U.S. $570 per ounce overnight, dealers said. Gold was stable between $273 and $274 with sluggish volume on a lack of fresh incentives, they said. Platinum has been overbought in the past few days, the dealers said. On the Tokyo Commodity Exchange (TOCOM), roughly 70% of speculators have been buying platinum futures contracts recently, they said. Speculative buying and short-covering extended overnight platinum's rally early in the morning, however, the dealers said prices slipped after the absence of follow-through buying capped prices in the afternoon. Black Blade: Ho Hum. Not much new here. GFMS says Chinese government silver sales hit 61 mln oz in 99 New York--May 24--Sales of silver from Chinese stocks jumped to 61 million ounces in 1999, up sharply from the 12 million ounces seen the year before, said Gold Fields Mineral Services in the World Silver Survey 2000, which was released Wednesday on behalf of the Washington, D.C.-based Silver Institute. (Story.15820)GFMS: 99 silver fabrication use exceeds supply by 156 mln oz New York--May 24--In 1999 the silver market saw a structural deficit as world silver fabrication demand exceeded supply by 156 million ounces, said GoldFields Mineral Services in the World Silver Survey 2000, which was released Wednesday on behalf of the Washington DC based Silver Institute. It said that world silver demand was up 5% in 1999 from 1998 levels. (Story .16094)Black Blade: Uh Huh, I can just see the pundits spin now: Silver – Silver everywhere. As far as the eye can see! Just a blip on da radar screen.NY Precious Metals Review: Platinum jumps, others slip New York--May 24--NYMEX Jly platinum futures ended up $6.50 at $548 per ounce after jumping to $555, which on continuation charts equaled the high made on Feb. 17. The $555 level is the highest price platinum has seen in 11 years. The jump was made on fund buying, which is being spurred by the tightening physical market supply. Gold, silver and palladium all ended lower. (Story.2333)Black Blade: Pt and Pd prices are about even. Both reversed direction after the GM and Nissan announcement. Up to about $560. Were up to about $570 earlier this morning. Yep, those supposed massive Russian supplies that came into Switzerland sure made a dent. Russian CBR May 19 foreign exchange/gold reserves rise on week Moscow--May 25--The foreign exchange/gold reserves of the Central Bank of Russia as of May 19 were US $18.3 billion, up $600 million from May 12, the CBR announced Thursday. (Story .5453)Black Blade: Can you just see it now, a strong rubble, and a weak Brit Peso. Soon many Russkies will be on holiday in London town and waving down taxis with packs of cigarettes, and buying manors in the country-side! Hmmmm……………. goldhunter (5/25/2000; 5:14:01MT - usagold.com msg#: 31226) Mr Crier... http://www.usagold.com Again you try and cloud the issue with REPEATED hogwash about hidden agendas about soliciting or advertising or other...An issue has come up, plain and simple and some of us will discuss it and "learn" about it...Isn't that why you're here? It's why I came...You go on and on, more smoke and more, like you need to protect someone from something, I'm not really sure...It's not attractive nor necessary...I promise NOT to steal one "soul" from you or whomever signs your checks...You promise to act professional, fire the "Amway Dist", and enjoy the road...We really are on the SAME TEAM...Helping others make profits... goldhunter (5/25/2000; 5:05:29MT - usagold.com msg#: 31225) Trail Guide Mkr #1 http://www.usagold.com Sir Guide...Apples to apples I do repeat...You can say you sold your Krands for $270.00 (a fair value?)for the day...Is that ALL you could get?...I read your post yest. in response to BTD, but to be FAIR, the "local price" from the vault was "$282.00 per coin" as I checked with CPM Inc. right after the store started for the day...Here in lies the Small problem...You could only "get" $270 but a comparison "purchase" costs $282...Is it not more truthful to have "bought both" yesterday AM.and see how the dust settles in the future on a total equity worth basis? I offered Dec1 as a practical window of time...Once again, The "buy" price of our physical contrasted with the "buy" price of our futures will give a fair and honest comparison of the two (in my opinion, related)"investments.You try and stack the deck in your favor by using the "sell price" of $270...and then using this as your "basis"...That isn't right for this comparison... HI - HAT (5/25/2000; 4:39:05MT - usagold.com msg#: 31224) Trail Guide Everything Is The Opposite Of What It Seems The Lord is a vast lake of fire. The purifier burns off that which one does not really have.The Hell seeks to freeze the status-quo, [ bondage ]The innocents twist in a web of stupifying complexity.What must compel the Living is to stand humbled before the tears and blood of an ancient procession walking silently,now, towards a golden truth.Thanks to you and Another for a link to the Trail that has no ending. Netking (5/25/2000; 2:59:29MT - usagold.com msg#: 31223) Ammendum Sorry I should have referred to 1980's $50.00/Oz not $500.00/Oz in the previous post. Mmmmmm, now maybe that was a prophetic number for silver inspired by The Lord. Gold Trail Update (5/25/2000; 2:54:41MDT - Msg ID:31222) The Gold Trail Discussion has been Updated The Gold Trail Discussion has been updated. Click on the link to read the latest updates. Netking (5/25/2000; 2:21:11MT - usagold.com msg#: 31221) Sir Silver Solomon(31208) Maybe we sound a litttle like the 'Lone Ranger' here talking about Silver at this golden table but hey remeber the horses name right!.What do the "Silver Guru's" think of Buttlers 'going to the moon in a stageIII rocket' plan for Silver? There is two years supply left right?(at the most), what happens then? Will 1980's $500/Oz be blitzed as Silver goes to 'Warp 9' speed & sets a record of consecutive limit moves?Shouldn't every gold bug that's done the sums contact MK & buy some Silver? Forget silver paper (aka Tulip Bulb bonds), Comex silver will default faster than a Turkey at your Thanks Giving season. ThaiGold (5/25/2000; 1:38:43MT - usagold.com msg#: 31220) Dot.Com's and EURO's: All going Down the Drain. Two Interesting NewsItems: (See links below) ......To ALL:This is an interesting NewsItem about USA Internet companiesdownsizing considerably, or just plain going belly-up:"From boom to bust in just two clicks"http://www.telegraph.co.uk:80/et?ac=000124036011016&rtmo=3mYxAKAM&atmo=99999999&pg=/et/00/5/25/wdotty25.htmlAnd this next link, is a NewsItem about the EURO's sorry state:"Bundesbank sounds alarm over euro"http://www.telegraph.co.uk:80/et?ac=000124036011016&rtmo=3mYxAKAM&atmo=99999999&pg=/et/00/5/25/weuro25.htmlThaiGoldThaiRanch@OperaMAil.Com=================================================================== WAC (Wide Awake Club) (5/25/2000; 0:51:51MT - usagold.com msg#: 31219) Dollar Coins Being Hoarded http://news.efc-inc.com/#524005 By C.G. WALLACE .c The Associated PressSALT LAKE CITY (AP) - Millions of the new Sacagawea golden dollar coins are in circulation. Really. Trouble is, normally spend-happy Americans are squirreling away the coins instead of using them as pocket change. ``People are hoarding them. They get them in change and because they haven't seen them before, they'll save it,'' said H. Robert Campbell, president of the American Numismatic Association and owner of All About Coins in Salt Lake City. ``They are almost spellbound by the coins.'' Customers are snapping up uncirculated dollar coins that Campbell is selling at his store for $2 each. The golden-colored coins were introduced in January. It depicts the young Shoshone Indian woman who accompanied explorers Meriwether Lewis and William Clark to the Pacific Ocean in 1805. Within its first four months of existence, 500 million Sacagawea coins were in circulation, U.S. Mint officials said. By this summer, shipments of the new Golden Dollar coins are expected to exceed 1 billion, with 6 million new coins being minted each day. SHIFTY (5/25/2000; 0:25:46MT - usagold.com msg#: 31218) The New LeMetropole Cafe Open! Looks good !Good night all$hifty WAC (Wide Awake Club) (5/25/2000; 0:25:37MT - usagold.com msg#: 31217) @Farfel - ...so good luck in getting them to pay for American tech products. http://www.worldnetdaily.com/bluesky_dougherty/20000524_xnjdo_free_trade.shtml One mistake we all seem to make is that because there a 1+ billion in China, this automatically implies a large market. Chinese on a renumeration of 3 cents/hour, the disposable income does not actually exist, hence no marginal propensity to spend. The 'wages' of the average chinese is just for sustenance. China is just one large slave camp for the USA and less so for Europe. This is really most excellent for the American people, because you don't have to ship them in this time, they are enslaved right there on there own land.I remember the words of Henry Ford, saying that he wishes to produce a car that ALL his workers could afford to buy. Wouldn't it be wonderful if Nike could say that they wish to pay the chinese workers a wage that would enable them to acquire a pair of Nike shoes. One can but dream.I blame not the American people for this dilemma. The question as to be asked, why do the leaders in China allow their own people to be enslaved?So, let's forget this idea that because china is heading for the WTO, that there's suddenly going to be a big nex export market. I suspect Finland and/or Denmark is probably a bigger market. ViewYesterday's Discussion.
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