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ARCHIVED DISCUSSION FROM 5/27/2000 All times are U.S. Mountain Time (Yesterday's Discussion.) TheStranger (5/27/2000; 23:52:18MT - usagold.com msg#: 31431) Solomon Thanks for your input.The contingency you raise, namely that "there can besignificant price decreases, even in the face of monetary inflation" is undoubtedly true, but never more than anecdotally so. What you may have really meant to say, if you'll forgive my presumption, is that SYSTEMIC price deflation can occur despite a policy of monetary inflation. This argument has been made before here at the Round Table on several occasions.For your benefit, I will repeat a challenge made long ago to all the Knights assembled. Towit: Please cite a single historical example where this scenario has actually occurred. Needless to say, there is no example. Nor will there ever be. Real monetary inflation ("real" meaning an increase in the supply of money relative to the supply of goods and services) has ALWAYS lead to higher prices. This is because the value of money, like the value of anything else, is a function of supply and demand.If you want to take up the challenge, here's a hint: Don't waste time on America between 1929 and 1933. During that deflationary period the nation's money supply dropped by a third! Solomon Weaver (5/27/2000; 20:44:57MT - usagold.com msg#: 31430) Stranger - Inflation Leland - I hope your #31425 was an attempt to show how far off base that guy is. When dollars become scarce relative to other currencies, one thing which has proven true time and time again is that people run to the dollar itself, not gold. Fortunately, however, it is virtually all currencies which are being inflated nowadays, not just foreign ones. Believe me, the world is not about to experience deflation in any of them.----------StrangerThe truth of your comment depends on "which" definition of inflation one uses.In the sense that almost all Central Banks and Governments will create additional money to handle liquidity crisis, I will agree with you that most currencies are experiencing "monetary inflation".On the other hand, the popular concept of "inflation" is actually "increase in average pricing of goods and services". Remembering that the "price of a good" is related to the amount of money "available" from multiple sources to "bid" for it, we should consider that when the "desire to spend" decreases dramatically (drop in monetary VELOCITY), there can be siginficant price decreases, even in the face of "monetary" inflation of the money supply.What appears to be driving the value of the dollar up now is the "scarcity" of liquid dollars to service debt, and perhaps an accelerated attempt to move out of dollar debt. It is almost irrational, but we could see significant dollar strenghtening in the near term (of course only makes the "correction" later more severe). By the way, in that correction, don't expect to see gold and dollar moving together anymore.Poor old Solomon tedw (5/27/2000; 20:18:32MT - usagold.com msg#: 31429) Silver and China http://www.usagold.com Ted Butlers article on silver was interesting, especially the link to the silver institute and their recent press release.The Press Release attritbutes the Offical Sector selling of Silver from China as keeping the price down.That being so, the coming war with China over Taiwan shouldbe the cause of silvers precipitous rise. Thoughts? TheStranger (5/27/2000; 20:10:02MT - usagold.com msg#: 31428) Aragorn III, Marius You are something else, Aragorn. Your #31427 is a long and thought-provoking missive aimed at a near total "stranger". I thank you for taking the time.Your remarks do, on the whole, make good reading. So much so, that I hope you'll forgive one nitpick. Certainly your observation about compounding is correct. The supply of above-ground gold cannot grow at 2% ad infinitum. But, for that matter, neither can the supply of anything else, including the human beings who might want to possess that gold. Might we not, in fact, be looking for space on the moon to store a population surplus long before we needed a spot for more gold. The issue, in other words, is not whether above ground gold can continue to grow at 2% in the VERY long run. Rather, the issue is whether growth in the supply might rise and fall to reflect demand in the FAIRLY long run (your lifetime, perhaps). It seems logical to me that it will, and, in fact, that it already does. If this is so, then gold, like scrip, is clearly inflatable. And no alchemy is necessary, either. All that's required is an inordinate diversion of the world's productive resources into gold mining. Leland - I hope your #31425 was an attempt to show how far off base that guy is. When dollars become scarce relative to other currencies, one thing which has proven true time and time again is that people run to the dollar itself, not gold. Fortunately, however, it is virtually all currencies which are being inflated nowadays, not just foreign ones. Believe me, the world is not about to experience deflation in any of them.Marius - Thanks! Aragorn III (5/27/2000; 18:28:51MT - usagold.com msg#: 31427) Growth and Value considerations for TheStranger, food for thought for ORO I should stress it was not my intent to leave an impression that "all things human" could be put on par with a culture as seen in a petri dish. We certainly have an ability to exercise some mindful control over our destiny and our productivity as you surely know, there are in fact limits beyond our control.Where you have remarked in your recent post, "I know the world's supply of above-ground gold currently grows at something like 2% per year. Meanwhile, the world population apparently doubles every 30 years or so, also indicating a rate of increase of about 2%. I would assume that, the higher the price of gold, the greater the rate of production and vice versa." We do not see price alone as a controlling factor for the rate of new gold production. In Turkey they have watched the price of gold increase by 800 percent in less than five years. Many others could be found able to boast of similar currency misfortune. Yet, let the price double, and double, and double again, it is not expected that gold production in these areas will move greatly beyond the mining pace seen today, certainly never keeping pace with price.A better speculation for you to attempt would be this: "I would assume that, the higher the **relative value** of gold, the greater the rate of production and vice versa." Certainly, we must acknowledge that the ATTEMPT would naturally be made to pursue greater production, but there are natural limits to the success, as we will see next.To start, we revisit your initial observation, "I know the world's supply of above-ground gold currently grows at something like 2% per year." Let us think about this practically. We have all heard the claims that compound interest has been described as "the greatest force invented by mankind" or some such variation of that. A single penny invested in the days of Christopher Columbus would now be a vast fortune were the account to grow by 2% each year. You surely see the limitation for above-ground gold supplies to expand at such a rate for any sustainable period. Given enough time, we would have to begin storage on the moon! But no. As the above-ground inventory is increased, such an additional annual two percent production would require ever more reserves to be found, yet the below-ground resources are not growing. They diminish with the removal of each ounce today. Further, I do not foresee the pavement of Paris or New York being torn up for the traces of gold to be found below.What now of the "biological" rates of inflation I spoke of for the real economy of goods and services? This is no petri dish to be sure, and our own numbers are not expanding exponentially, yet consider this example of which you are keenly aware but shared "out loud" for the benefit of all to see how quickly we may let the productive genie inflate outside of the bottle of steady population.For this instructive example, I need reach no further than my own dear circle of friends. Selecting among them I shall make you aware of three; one from China (who indicates the "daily wages" among his family and neighbors during his youth were nearly zero because the farming existence was simple and self-sufficient in nature) while the other two for this example originate from Viet Nam and India. In the countryside of their native lands, you can easily imagine there to be little opportunity for them to add meaningful levels of productive value for which the world's wealthy population would compete to purchase. If you work the long day in fields with a hoe to grow just enough turnips and cabbage to feed your family, you do nothing to ADD to the value of gold held by others because you have no EXCESS to offer in exchange for the gold. To be sure, the turnips could be exchanged for gold, which could then be exchanged for an equivalent value of rice and wheat. But had excess foodstuffs been produced against a backdrop of a given gold supply, the gold price of turnips would surely be reduced due to the inflation of real turnip supply.It may be argued what rate may dictate for the productive growth of these many similar people...the development and provision of infrastructure (a new road, an electric cable, water distribution lines, etc.) would open a gate to greater productivity among the existing populations. When viewed like this, at question is how quickly the infrastructure, productive capacity, and concurrent opportunities of a "New London" or "New Denver" or "New Pittsbugh" could be developed and brought to these populations.If we turn to my three selected friends, we are offered a better lesson and insight in growth rate potential for the real economy. While the city may not come quickly to the boy, the boy may nevertheless come quickly to the city! Right now, each of these three gentlemen are engineers in U.S. cities, producing far more real value in each year than they ever did before or can personally consume. In very little time we can see how the real excess output of three individuals rose, and as such, the product inflation they produced help "cheapen" their respective products, while at the same time adding to the value and competition for the existing gold supply as a "store of wealth" asset.Having thus cast your comments and assumption in a better light, what do we make of your concluding remark: "Doesn't this mean the amount of tradable gold would be almost thermostatically controlled by market forces in the long run?" Perhaps we may now see that "free gold" would be on course for a grand adjustment to higher valuation relative to all things, including currency (particularly the U.S. currency!), which is then to be followed by a salient trend of sustained, climbing real value, even as it may be mined (and taxed accordingly by the sovereign state) with the utmost vigor.ORO, rather than sacrificing gold as a mere tool to enhance/enforce market discipline to banking in general, would it not be more suitable to allow gold to perform more perfectly its unique ability in the role of an unmanipulated, un-artificially-inflated wealth asset?got gold appreciation? SHIFTY (5/27/2000; 16:38:10MT - usagold.com msg#: 31426) AUNUGGETS Still here, running late (Im late Im late for a very important date!) I mine in north Georgia! Nice gold in Georgia. Gotta go! No time, should have left this morning. The later I got the HOTTER it got. I don't have A/C. It's just now cooling off enough to hit the road. see ya $hifty Leland (5/27/2000; 16:16:06MT - usagold.com msg#: 31425) A "Golden Jewel" http://www.gold-eagle.com/gold_digest_00/droke052900.html Many ask, "How can gold offer value and financial protection in the period of late runaway deflation that we are entering?" It is true that gold's fundamental tendency is to lose dollar value during period of deflation. But when overseas markets and currencies are losing value relative to the U.S., investors in foreign countries seek protection in precious metals. With foreign stock markets beginning to crumble and currencies rapidly losing value, foreign capital flight will find a channel in gold investments, among other things. This, along with diminishing faith in global fiat currencies, explains how gold can appreciate in even in the most deflationary of economic environments. We are entering the worst of all possible worlds-a deflationary cycle which will wreak havoc on equities prices, erode currency values, inflate certain staple commodity prices, and exert a lifting effect on interest rates. For the first time in nearly a decade, it is becoming quite expensive to be a debtor, since the value of debt is continually rising due to the strengthening value of the dollar, while interest rates are also increasing. In such a perilous economic milieu, it is the gold investor who possesses peace of mind, knowing his assets are safe from the ravages of the developing financial storm. Clif Droke 29 May 2000 aunuggets (5/27/2000; 14:08:36MT - usagold.com msg#: 31424) SHIFTY - BLACKLADE Shifty ? Dredging for gold in Florida ? I assume it is of the pre-dug, pre-fabricated (and lost again) type ? (grin) We regularly go west on the vacation equipped with gold pans and Goldmaster detectors. Nothing like having "A hobby where the heart is", eh ?Black Blade - Those Mexican 20 peso gold coins are indeed nice designs, and happen to be one of the least counterfeited bullion types of all time. That calander device would certainly be a challenge.... Aztec by the way, and these coins were once refered to as "Aztecias", the larger 50 peso gold pieces as "Centenarios". Both beautiful designs. TownCrier (5/27/2000; 13:54:44MT - usagold.com msg#: 31423) Sirs PH in LA and Leland, the new FASB 133 guidelines is nothing new to USAGOLD visitors... http://www.usagold.com/NewMillenniumGold.html Last Autumn we offered a Gilded Opinion piece by Leanne Baker of Salomon Smith Barney (see the full commentary at the link above) that gave us all an adequate warning of the coming change. Thank you for revisiting this topic now that we are on the threshold to its implementation.Below in an excerpt regarding SFAS 133 from the Gilded Opinion page called "A New Millenium Gold Rush"--which also gave a nice perspective on the Washington Agreement.--------------------SFAS 133 -- NEXT YEAR'S ACCOUNTING NIGHTMAREFASB has written a new accounting standard governing the treatment of derivative instruments and hedging activities in financial statements. Implementation was recently postponed one year to June 15, 2000--and debate continues as to the impacts of this complex, technical standard on company income statements, balance sheets, and actual hedging behavior. SFAS 133 will require different accounting treatment for derivatives considered "hedges" and "non-hedges"--with most related activities by mining companies qualifying as "cash flow hedges." However, many derivatives strategies will fail to qualify for hedge accounting--and thus to the extent that these are used to offset an economic risk (the gold price), mark-to-market impacts to net income will not be matched by recognized period-to-period changes in the underlying exposure (the value of reserves). This will result in greater net income volatility.Important departures from current practice will be marking-to-market of the time value of options through the income statement-rather than straight-line amortization of the premium paid or received. Forward contracts will be treated more favorably--with mark-to-market fluctuation flowing through equity on the balance sheet. However, this will introduce equity volatility and has the real potential to throw off credit ratios--complicating the lives of analysts, bankers, and shareholders. Under SFAS 133, the recent gold rally and plunge in mark-to-market value of mining companies' hedge books would result in huge hits to net income from call options sold and to equity from sub-market forward contracts. Current rules allow these effects to be disclosed as a simple footnote to the financial statements, but if the gold price stays in the $320 per ounce range--or trades higher as we expect--the SFAS 133 derivatives-related damage to company income statements and balance sheets will be staggering.HEDGE BOOK MARK-TO-MARKET VALUES PLUMMETEDRising gold prices, lease rates, and volatilities have also served to crush the mark-to-market value of company hedge positions--most of which have swung deep into the red since the second quarter reporting cycle. The symmetry is intriguing--that much-touted premiums to spot in previous periods are often completely offset by negative mark-to-market values now, revealing that many programs amounted to simply selling financial risk. The damage is compounded by the fact that price premiums were earned when gold prices were low, group equities were out of favor, and share-price multiples contracting-- while the upside is surrendered now that investor interest is high and multiples expanding for gold-leveraged names...As spectacular as some of the negative mark-to-market numbers are, it is important to recognize that under current U.S. GAAP, the value of derivatives is shown as a footnote to the financial statements and does not flow through the balance sheet or income statement. With the implementation of SFAS 133 next year, this will all change. In severe cases, counterparties can demand that mining companies post cash margin to cover the paper loss--exactly what happened to Ashanti Goldfields, whose hedge book plummeted from positive $300 million in value during our July site visit to an astounding negative $570 million at $325 gold. RossL (5/27/2000; 11:39:44MT - usagold.com msg#: 31422) Updated Chart http://users.erinet.com/3354/gold2400.htm I have updated the SDR-currency chart. The currency gyrations of the last two weeks can be seen clearly. The British Pound is tanking. The Euro seems to have bottomed. The dollar has leveled off after the rise.I have so much planned for the next two weeks that I may not be able to update it again until mid-June. Leland (5/27/2000; 11:30:07MT - usagold.com msg#: 31421) PH in LA "$74 trillion or so [estimated notional value] of derivatives must now bedisplayed, as well as a rational for the strategy."Forget the national debt, this is bigger!! PH in LA (5/27/2000; 11:22:23MT - usagold.com msg#: 31420) Incoming!! Incoming! Time to take cover? http://www.bearforum.com/cgi-bin/bbs.pl Heard at another forum (see link). Has this guy been reading FOA? Or is this (like all good ideas) just appearing "in the air" all over the place at the same time? Posted By: L.A. Bear (Date: Saturday, 27 May 2000, at 6:07 a.m.)Derivatives Time Bomb???We indeed live in interesting times. The new FASB 133 guidelines will go into affect shortly requiring the reporting of all derivatives positions and marking them to market. We shall soon know if derivatives are really the ticking bomb waiting to burst this bubble. "For the 1st time in financial history, risk management positions - derivatives - must be reported next month due to FASB 133. It requires all companies to report on their balance sheets the fair market value - marked to the market - of its derivatives. There will be enormous discrepancies in that value, as derivative accounting/valuation is subject to a good deal of interpretation and surmise. Nevertheless, the $74 trillion or so [estimated notional value] of derivatives must now be displayed, as well as a rational for the strategy. Brokers and gold producers short gold in excess of what they own, or can deliver will raise eyebrows, if not investigation. Bankers & brokers must be horrified at the Pandora's Box they must open. Companies that use derivatives to boost earnings will be humbled. A year or so ago, Forbes reported on its web cite that Dell made more money shorting puts on its stock that it did selling computers in a previous quarter or so. Unwarranted currency, interest rate, energy, stock, Baltic Freight, etc. derivatives will now be liquidated as the gray-hairs that are the captains of industry will be loath to report derivatives that can be perceived as imprudent. This will hammer brokers and bankers with large derivative desks. In a bear market, most, if not all, of the surprises are negative." This excerpt is from the "Daily Briefs" section where Ramsey King is a regular contributor (see link below). The daily brief section is a good summary of daily news from multiple webb sites. NEEXT POST (BY TANABEAR):IMHO, The most IMPORTANT post I've read on this BB in MONTHS!!!!!!!!!!!!!!! Mr. L.A. Bear, Can you please expand as to date due and what the HELL a FASB133 even is? I am sure it is an SEC filing but am totally in the dark. I thought they (Congress) had been bought off and had decided "that derivite oversight was not necessary" As you are probably aware, this is the one biggest issue facing the state of international, financial well being today. Unduly Complex and Insolvent Derivitive Contracts have the potential of doing more damage to world economies, ESPECIALLY OURS, than anything else out there today . Want Proof? NOBODY TALKS ABOUT IT!!!!! Can you name JUST ONE other 100 Trillion Dollar segment of our national economy which NOBODY even mentions? Could it be that nobody wants to be blamed for yelling "FIRE" in the auditorium? As far as that goes can you name one other 100 Trillion Dollar Industry, in America? Canst thou spelt BUBBLE? Tanabear Rule # 14: "In America, ONLY worry about, what they DON"T talk about!"HehHehHeh, Cheers---------------Tanabear Leland (5/27/2000; 10:55:24MT - usagold.com msg#: 31419) Leigh, I Know You Are Relieved...So Am I! Lloyd's Won't Seek Swissair Jewels Updated 7:29 PM ET May 23, 2000 By SUE LEEMAN, Associated Press Writer LONDON (AP) - Lloyd's of London canceled its plans Tuesday to search the site of the 1998 Swissair crash off Canada for $200 million worth of diamonds and jewels, saying it was sorry "for any distress" it caused crash victims' families by initially pursuing a search. Hours earlier, Lloyd's spokesman Adrian Beeby denied that the insurance company was being insensitive by seeking to retrieve the valuables from the wreckage of the crash, which killed 229 people. He said the site already had been dredged by Canadian authorities immediately after the plane went down. But Lloyd's later said in a statement that the license it applied for to search the site, if issued, would be used solely to deter treasure hunters. "The reputation of Lloyd's has always been founded on its integrity," the statement said. "Consequently, Lloyd's will not dive or explore the site, respecting the wishes of the families. Lloyd's would like to apologize to all of the families of the victims of the Swissair crash for any distress caused by its application for a license." Investigators still have not discovered what caused Swissair Flight 111 to crash into the ocean just off Nova Scotia on Sept. 2, 1998. Through a Canadian insurance company, Lloyd's had asked the Nova Scotia government for permission to hunt for 4 1/2 pounds of diamonds and 11 pounds of jewelry listed on the flight manifest. The diamonds reportedly were in a stainless steel tube, which may have disintegrated on impact or been driven deep into the seabed. Lloyd's had said it planned to start hunting this summer, using a mini-submarine to seek the gems among the wreckage, which lies in about 200 feet of water. Swissair spokesman Jean-Claude Donzel had said the airline was not involved in the salvage issue, calling it "something between the rescue and investigation team and Nova Scotia." Ian Shaw, whose daughter died in the crash, argued before the Nova Scotia legislature Friday that no one should be allowed to "rake through" the site. He said other victims' relatives also opposed the plan. He later called the company's change of heart a "ray of sunshine" Bill Estabrooks, a member of the Nova Scotia legislature who represents communities near the crash site, had said the province should reject any treasure trove application "because of the sacredness of the site." (Fair Use For Educational/Research Purposes Only.) SHIFTY (5/27/2000; 8:03:50MT - usagold.com msg#: 31418) PONZI For those that read my ponzi posts: They may be late or missing this week if I cant get to a computer. I will do my best , but hey we all know where its headed. ( LOWER )Maybe Thaigold will fill in next week?$hifty SHIFTY (5/27/2000; 7:52:17MT - usagold.com msg#: 31417) RUMOR/GOLDFIELDS I heard from a good source (very good source) that Goldfields is rumored to be talking with NEWMONT and Franco- Navada ! New un-hedged Powerhouse! I hope so!!$hifty Leland (5/27/2000; 7:38:57MT - usagold.com msg#: 31416) From Jim Cramer -- An E-Mail That he Posted on His Site "I am a very dedicated reader of the site and you in particular. But I must share with you the horror of this market and my activities in particular. I must have taken a really big dumb pill two months ago or things have really changed big time. I have managed to lose my entire $2.5 million account in the last nine weeks. I am very experienced and have invested and traded for 13 years. "I am 33, single and have no kids, thank God. I will be the only one who really suffers this bad dream. I have let my parents and good friends down big time. I think they hurt for me more than the numbness I am feeling. Jim, I knew to take something off and even went to a trusted friend to beg him to make sure I did. The dinner meeting on that Friday was followed by a Monday where I went from $1.9 million to $800,000. I was stunned, frozen stiff, couldn't act to take something off then, heck it was too late, right. "WRONG! The following Monday I went down to $400,000. Now it was really to late, right? Yeah, right. "WRONG again. The market had just crashed and heck, Brocade was going to report blowout EPS in a couple of weeks. It should run ahead of the numbers just like last quarter I was thinking. "WRONG!! This is something I must live with for the rest of my life. It is very difficult, since I knew what to do but got caught in the decline so fast. I will recover eventually, but geez, I wish I could turn the calendar back two months for once in my life. I need a mulligan so bad it hurts. "I broke the No. 1 rule, survival, be left standing. I have given 5-6 gift subscriptions of TheStreet.com over the past year. I sure hope they listened to take something off and be left standing more than I did." Yep, that's right. This letter writer lost it all. And $2.5 million is a lot to lose. Heck, anything is a lot to lose. I present this sobering email because, 1) I don't want it to happen to you, and 2) It is never too late to take something off the table. When I started this "take something off the table" call a couple of months ago it was in reaction to a woman screaming at me in a parking lot after I had spoken at the Miami Herald investment conference. She was telling me that I would lose it all. No way, I said, I am taking something off the table. The following day I wrote a piece for the site outlining again, that I was redoubling my efforts to take something off the table. We took a huge amount off. We even personally switched some money to New Jersey municipal bonds, something I thought I wouldn't do unless I knew thermonuclear war was coming between Jersey and New York! So, let's get something straight. From Jeff, as I will call this letter writer, it was not too late to take something off three times. But then it was too late. Don't make his same mistake. If you are riding on big, big wins and they aren't as big as they were but they are still big and you have taken nothing off the table, you are being foolish. The most you will lose is opportunity cost and the taxes to the federal government. Jeff, by the way, owes no taxes. He has no money! So much for the tax man. Second, it can happen to you. I don't care how good you are. Objectively you are not better than Julian Robertson, Stanley Druckenmiller or Stanley Shopkorn. Trust me on this. I think I am really good. I have the long-term record to match these guys. But their departure shakes me to my bones. These are mentors, teachers and Hall of Famers. They are guys I learned to respect when I started 20 years ago. I can't say that my teachers and mentors got too old. I can console myself that they might have gotten too big, but that's a little chimerical because they had been big for years. I respect my elders. These guys were pros. When it is too hard for the pros, it is too hard for the amateurs, no matter what the size. Third, Jeff wasn't a newbie. He had traded for 13 years. He had obviously been through the 1990 and 1994 and 1997 and 1998 downturns and lived to tell about them. He knew enough to play the Brocade (BRCD:Nasdaq - news - boards) upside, a company that is hard to understand, but has done spectacularly and was a good percentage bet. (We made the same one and we are pretty good at the upside surprise game.) Yet, this downturn caused him to lose everything. This downturn is the big storm, the one that gets you. Fourth, the downturn isn't over. That would be wishful thinking. Sure it could end. But as we will see from this series, time will cause it to end. Not events. Time. Fifth, and finally, I am writing this stuff for one reason only: to be sure that you have some money left and can live to play again. The most salient thing in Jeff's note to me is that he recognized the cardinal rule: Survival, to be left standing. That's what this game is all about. That's what we talk about in the huddles at Cramer Berkowitz. We want to be left standing after the bears romp. Maybe we have to play dead for a while. Maybe we have to hide. Maybe we just have to leave the park altogether for a while and stay in cash. Whatever. The goal is survival, preservation of capital for when the bears have eaten so many salmon that they lull themselves to sleep or go into hibernation. If you don't believe me, like the marshal in the Fugitive said: "I don't care." I know I am right. (Thanks to Jim Cramer, And Fair Use For Educational/Research Purposes Only.) Black Blade (5/27/2000; 6:35:20MT - usagold.com msg#: 31415) @Leland Msg. 31412 >About Ted Butler, sometimes I wonder...what it's all about...Is it actually us little guys (like Ted) in awar with the big boys?<Black Blade: Isn't that always the case? There is a war going on over the PMs. Look at all the battles around us. The TOCOM Pd default, the UK dutch auction, the Swiss unlinking their franc from Au, etc. etc. Then there are those of us like Ted Butler, GATA, Reg Howe, Frank Veneroso, you and me. They got the big guns, we get pounded, but they are running low on ammo ;-)Sometimes it don't seem like a fair fight.Going fishing again today, got beer, got fishin gear, and my latest copy of "News and Views". Take care. JavaMan (5/27/2000; 6:32:03MT - usagold.com msg#: 31414) Good morning Leland... I read your link with my morning coffee. Sheesh...what a way to start the day. In this story, I see the truth of a proverb - There is a way that seemeth right unto a man, but the end thereof are the ways of death. Forewarned is forearmed. Thank you, good sir. Black Blade (5/27/2000; 6:25:17MT - usagold.com msg#: 31413) Morning Wakeup Call! (The Ag news is interesting though) Source: Bridge News Russia's Norilsk says makes regular PGM sales on world market Moscow--May 26--Norilsk Nickel, Russia's largest producer of platinum group metals (PGM), is making regular sales on the metals on the world market, Norilsk Chairman Yury Kotlyar said Friday. He also said Norilsk's PGM export quota for 2000 exceeded those in 1998 and 1999. (Story .17302)Aide says Russia's CBR made ample palladium deposits abroad Moscow--May 26--The Central Bank of Russia has deposited 120-300 tonnes of palladium at foreign banks, a government official said Friday. A large part of the deposits has reportedly been made to Swiss banks. (Story .17431)Black Blade: Too little - too late. You have to wonder what is meant by "regular sales"? That's quite a spread of deposited Pd - they don't sound so sure.Rumor mills wind up as South Africa's Gold Fields issues notice Johannesburg--May 26--A cautionary announcement by South African gold producer Gold Fields Ltd. that it is in discussions with a number of parties has sparked a flurry of speculation on potential targets or whether a merger is on the cards. Either way, Gold Fields is believed to be close to announcing a deal in line with its stated strategy of replacing reserves and production. (Story .14364)Black Blade: A friend of mine close to the situation says that it's more than a rumor. I am not allowed to say who, some who have posted on this on the other forum have it nailed though (wink, wink). We have to see if the parties can come to an agreement.NY Precious Metals Review: Gold up on dlr dip after Thurs loss New York--May 26--After slumping to an 8 1/2 month low of $269.50 per ounce Thursday, COMEX Jun gold managed to recoup some of these losses to settle up $1.50 at $272.20 in Friday's abbreviated session. Gold was helped by the US dollar's losses against other currencies, particularly the euro. Silver, platinum and palladium also climbed on the back of dollar's slip. (Story .2333)Black Blade: Weakening Dollar? Hmmmn……GFMS says 800 tonnes silver shipped from UK to US in February New York--May 25--In February 800 tonnes of silver was exported from the United Kingdom to the United States, said Philip Klapwijk, managing director at Gold Fields Mineral Services. He said that COMEX stocks in the US have risen sharply and dealer stocks in Europe have fallen as a result of the silver price arbitrage between London and the US. (Story .22389)Black Blade: Could Warren Buffett be calling home some of Berkshire Hathaway silver? A bit-o-silver piled into the COMEX warehouse, raising stores to over 102 million oz. Remember that there was some speculation back a couple of months ago. Hmmmnnnn…….. S African gold output dips 7% to 3.43 mln ounces in 1st quarter Johannesburg--May 25--South Africa's total gold production eased 7% to 3,426,064 ounces (106,562 kilograms) for the quarter ended March 31 from 3,682,273 ounces (114,531 kilograms) in the preceding three months, according to the Chamber of Mines. (Story .17055)Black Blade: How much anyone wanna bet that this new of Au supply reduction doesn't make it to the mainstream media? Leland (5/27/2000; 6:15:26MT - usagold.com msg#: 31412) Sir Black Blade About Ted Butler, sometimes I wonder...what it's all about...Is it actually us little guys (like Ted) in awar with the big boys?Thanks for the article. Leland (5/27/2000; 4:28:17MT - usagold.com msg#: 31411) Doug Noland -- "Ponzi Finance" http://www.prudentbear.com/credit.htm "Unfortunately, we see the U.S. financial and economic bubble as history's greatest episode of Minsky's "Ponzi finance." Importantly, "a ‘Ponzi’ finance unit must increase its outstanding debt in order to meet its financial obligations." Such a structure is patently unsustainable. And with the U.S. now running a current account deficit of more than $1 billion daily, there is "no room for error." Foreign lenders must remain highly confident in the soundness of the U.S. financial system and economy. Unfortunately, we just don't see how such confidence can be maintained. When foreign source creditors are unable or unwilling to continue to finance our boom – either due to a change in perceptions or the forced unwind of faltering leveraged speculations – the game is over. If our invoking Minsky "Ponzi finance" analysis is indeed the correct analysis for the U.S. bubble, the prognosis is increasingly perilous."[Click for More] Black Blade (5/27/2000; 2:21:18MT - usagold.com msg#: 31410) Ted Butler is at it again. http://www.gold-eagle.com/gold_digest_00/butler052700.html Ted Butler hammers home the point about the Ag deficit. Some would probably prefer that this guy stop ranting about the Ag deficit and manipulation of the PMs. I can imagine that he is probably like Chinese water torture where the first few drops are just an annoyance, but eventually the force, drop by drop, become rather difficult to ignore. Good article! Black Blade (5/27/2000; 1:51:04MT - usagold.com msg#: 31409) @Shifty Kept two 16 inch browns and 1 14 inch rainbow (has a nice gold red color down the sides). Released several more, but only needed acouple for dinner and breakfast. Going out again tomorrow. Fishing hole is about 200 yards from the front door, unfortunately no gold in there, only gold colored trout :-) SHIFTY (5/27/2000; 0:50:39MT - usagold.com msg#: 31408) ORO I read your post again . I don't quite get what you are saying. I think that Americans should mine our own steel , build our own cars, TV sets, VCR, toasters, ect ..... I don't see were chasing all over the globe for the cheapest labor is beneficial. It may look good on the books for a time , but when all the industry has left the country and all we have left are a few Mc Jobs , how do you defend the nation in a time of war? Hope that we can buy what we need from other country? I cant tell were you stand. I need to get some sleep and hit the road . I will try to get to a computer this week and pop in from time to time. I hope we can agree. If not then we can agree to disagree. Have a good holiday.$hifty SHIFTY (5/27/2000; 0:24:24MT - usagold.com msg#: 31407) Black Blade Did you catch any fish?I sold my bass boat a few years back. It loved to drink the gas with 140hp. Now I use an old fiberglass 14 ft Johnson with a 25 hp Johnson kicker. ViewYesterday's Discussion.
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