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ARCHIVED DISCUSSION FROM 8/29/2001 All times are U.S. Mountain Time (Yesterday's Discussion.) ORO (08/29/01; 23:58:46MT - usagold.com msg#: 60499) escapethematrix - sorry about that See prior post, intended for you From prior link:"Earlier this year he was also scathing about America's reluctance to commit itself fully to an international campaign against money-laundering. He said that such market-driven attitudes "prevent the emergence of a global consensus to combat the destructive effects of globalisation". "Note that globalization is something that individuals are doing in the pursuit of their own interests and for their own benefit, but this is somehow "destructive". It is only destructive of the interests of mediocre governments in their parasitic role. I suggest that along with very high end French antiques now flooding the US market we open the doors to French engineers and researchers. The antiques are being sold from France because of the liquidity tightness induced by the ECB and because of the sudden cessation of investment by high tech and communications businesses threatened by the French centric EU led initiative against the internet and free markets.I should indicate that the religion and philosophy of the French and German political elites are "bureaucratic expert-ism". The belief that society and commerce need be "optimized" by experts endowed with specialized training and government authorizations, who majestically impose their perfect decisions on an accepting society in awe of their benevolent virtuosity.That these bureaucratic experts have no motive to make a decision that is beneficial to all or most individuals does not bother the elites. Nor does the fact that individuals leave the "official" economy in order to pursue a system not "optimized" by experts ever challenge their belief in central planning and "experts" though people vote against them with both feet and their wallet. It is always something "wrong" with the people who refuse to comply with the crystalline perfection of the expertly rendered bureaucratic decision. BR549 (08/29/01; 23:32:49MT - usagold.com msg#: 60498) Comments on Comments BB-"This time it's a race between the Nikkei and Hang Seng for sub 10,000. BR-Is it too late for the DOW to get into this race? Only 90 points away.NK-" If we can't restart our economy, and quickly, we will export our recession to the rest of the world – and the entire global economy could spiral down into sustained contraction . . . "BR-It hasn't already happened?CP-" Fed Chairman Alan Greenspan was wary of Treasury Department "initiatives," 1995 meeting minutes show."BR-And why do we have to wait five+ years for these minutes? What are they saying in there?WR-" I throw myself on the mercy of my gold loving bear-friends: what should we do with this account? Leave it alone? Sell the stocks? Sell the stocks and the bond funds? Sell everything?"BR-Yes, get out of paper, pay off your mortgages and get rid of all bankster debts, buy Physical gold, and don't store it in the bank. The DOW will be below $8,000 by the end of the year. My crystal ball is in the shop and my advice is FWIW what you paid for it. This is what I have done. And I haven't lost a nickel in 401K's.FoxNews Channel-Greenspan and 4 of his cronies lost over $2MM in their investments this past year, mostly in Treasury Bills.BR-Good! Gandalf the White (08/29/01; 23:19:18MT - usagold.com msg#: 60497) OOPS ! That low tonight was 10,807.75 Gandalf the White (08/29/01; 23:18:07MT - usagold.com msg#: 60496) Watching the Japanese Stock Market drop ! http://web.kyoto-inet.or.jp/people/je3tbc/html/sthome.html The above LINK is to a NIKKEI 225 chart -- it is a little slower than the postings at the YAHOO World Stock Market page which presently shows the afternoon session as:Japan Nikkei 225 12:55AM 10923.36 -56.40 -0.51% The low of the morning session was 10,980.75<;-( ORO (08/29/01; 23:11:53MT - usagold.com msg#: 60495) econoclast - Verdine and the French socialist gadfly http://www.guardian.co.uk/international/story/0,3604,543586,00.html The French governing class (and it is that - just as much as the Bourbons were), through the OECD, and with active assistance from the Germans and some enthusiasm from the Clintonites, are trying to eliminate competition among governments to provide the best environments to business and earners of "geographically non-specific" income. They are also at the center of the treaty negotiations aimed at drowning the internet with criminal and civil liabilities for "libel" (read as "criticism" of the French government and the EC). The central governments of the EU are attempting to inflict on the world at large their economic diseases of managed economies and frozen labor markets. The Kyoto accord had nothing to do with global warming and everything to do with limiting US growth with restrictions on demographic and economic growth - which translate to increased CO2 emissions. The OECD "anti money laundering" effort and anti "unfair tax competition" efforts were targeted at governments that sought to better their people by competing with EU and developed markets with lower taxes and better services, particularly protections of property and privacy, thus attracting business investments. What the EU in general and the French in particular fear most is that the US succeed economically and provide the world with a freer market model that would set the tone for competition among governments. This instead of the EU model of government cooperation against the commercial and general freedoms of the individuals that are humanity at large. The French are so vocally critical of the US "unilaterally" taking the path of competition rather than cartelization of governments through treaty.What Verdine wants: "controlled globalization", is a catch phrase for "no competition" and "no free markets". He protests because his class is the greatest potential loser of such competition, since the French government is the largest beneficiary of EU monetary transfers for farm subsidies etc. and outright competition among governments to attract and retain commercial activity would mean the rest of the EU would try to cut costs that provide no internal benefit and French subsidies would be the first thing to go.French fear of cultural marginalization are materializing as the younger French generations are joining the freewheeling largely Americanized global internet centered culture. The attractions of highly polished and easily accessible American pop-culture are making for a future with only a marginal role for French language and culture even within France. What the French political class fears is being unimportant. megatron (08/29/01; 23:05:55MT - usagold.com msg#: 60494) White Rose Any investment you make in gold bullion should keep you safe, no matter what,inflation or deflation. I would keep it to a smaller per centage. After that your into personal 'loyalty' territory. Do you believe in the long term value of the $US? Would you have a problem shorting the $? Do you agree with the silver supply/demand statistics? Maybe Swiss bonds or annuities are your kind of thing, if you don't trust US denominated assets. Some Canadian funds hold gold and silver bullion. I would bet a lot of people are having the same conversation in their head as you are. Gold bullion, Us T-bills, and certain Swiss bonds would be the safest bet today. If Swiss bonds get in trouble, it's probably all over, and your gold will go to the moon. IMO Black Blade (08/29/01; 22:53:51MT - usagold.com msg#: 60493) Japan banks face Y1.89 trln stock loss http://biz.yahoo.com/rf/010829/t73652.html Snippit:TOKYO, Aug 30 (Reuters) - Japan's 15 top banks held a total of 1.89 trillion yen ($15.73 billion) in net latent losses from their stock holdings as of Wednesday, according to a recent estimate by Daiwa Institute of Research (DIR). Under mark-to-market accounting rules to be introduced in September, Japanese banks are required to deduct 60 percent of unrealised securities losses from retained earnings that are mainly used to pay dividend. Analysts have warned that some top banks would find it hard to pay promised dividends on preferred stock issued to the government, which could increase the government's say over the banks' management policies.Black Blade: Rumor is that some Japanese banks will be forced to either merge with "healthier" Japanese banks or go under. The situation is looking absolutely "Grim." Netking (08/29/01; 22:45:19MT - usagold.com msg#: 60492) Goldfields eyes merger after posting strong results http://www.smh.com.au/news/0108/30/biztech/biztech15.html Snippit:Mid-sized gold producer Goldfields yesterday indicated that discussions over an $842 million merger with Delta Gold were well advanced, confirming it had appointed a corporate adviser.Goldfields managing director Dr Peter Cassidy substantiated talk the company had appointed corporate banker Credit Suisse First Boston to advise on the deal but would not elaborate on its progress."What we have said to the stock exchange, we have nothing further to add at the moment," Dr Cassidy said.But other sources noted that representatives of both companies were stepping up due diligence activities and had visited each other's respective operations in Western Australia in recent weeks.Some speculated that an announcement of a friendly merger between the two companies could come as early as this week . . ." Netking (08/29/01; 22:22:39MT - usagold.com msg#: 60491) Never mind the surplus, what about global "contraction" http://www.washtimes.com/op-ed/20010829-75604186.htm Snippit:". . . According to the respected British journal, The Economist, Germany's economy is "unexpectedly stagnant." Japan's is in "steep decline." East Asia and Latin America are "slumping alarmingly." Singapore's gross domestic product has fallen 11 percent and Taiwan's has gone down 6 percent so far this year. Overall, global industrial production fell at a 6 percent rate for the first half of 2001. Japan is experiencing deflation.The world's excessive reliance on a strong American economy to buy its goods and services is a new danger. Six percent of everything made in the rest of the world is sold in America. That is up from barely 3 percent just 10 years ago. Last year, a full 40 percent of all economic growth in Asia (except for Japan) was due to increases in their export of information technology to America. If we can't restart our economy, and quickly, we will export our recession to the rest of the world – and the entire global economy could spiral down into sustained contraction . . . " BR549 (08/29/01; 21:58:22MT - usagold.com msg#: 60490) Pitchin' & Grinnin' BR549-"Let me go comb my hair, clean my glasses, put on a clean shirt, and I'll post this."-I'm Grinnin’ pitcherone that pitches; specifically : the player that pitches in a game of baseball pro·fun·di·ty the quality or state of being profound or deeplev·i·ty from "levis" light in weight"Profundity does not preclude levity"The quality of being a deep light weight? Sorry, I just couldn't resist.Makes my earlier point about using the word you are attempting to "define in the define-ition". You lurkers come on in, the water's fine. Black Blade (08/29/01; 21:56:53MT - usagold.com msg#: 60489) Corning to cut 1,000 more jobs http://cbs.marketwatch.com/news/story.asp?guid=%7B33EDA706%2DAD96%2D414C%2D970E%2D662E9AFAEC19%7D&siteid=mktw Snippit:CORNING, N.Y. (CBS.MW) -- Corning will cut 1,000 jobs from its optical fiber work force due to a continued slowdown in the telecommunications sector, especially in North America and Europe, the company said late Wednesday.Black Blade: "Bone Pile" grows higher! This economy is in serious trouble. I heard George Dubya today trying to deflect the bad economic news (heading it off at the pass?). He inherited a tough situation but it is next to impossible to stop the Recession from getting much worse. It will truly get very "Grim" unless there is some miraculous event very soon. I would stash some PMs in a safe location for insurance and hope for the best at this point. We live in "Interesting Times." Netking (08/29/01; 21:54:31MT - usagold.com msg#: 60488) POG/POS - Market Timing To those who follow market timing, this post taken from another forum may be of interest: "Sunday marks a full moon and plus or minus a day or two for a major bottom in SILVER! Note that MARS was very close this year and a very bright planet in the Southern U.S. Sky. In exactly two years from NOW, MARS will be closer to EARTH than it has been in 5,000 years! And it will glow eight times as bright as it appears now!! What does this mean?? Stay tuned , my friends. Gold to rise $100 by Mid October THIS YEAR!"(posted by rabbit)-----------------------------------------------------------It may be totally wrong, but some wishful thinking never hurt! - Netking Chris Powell (08/29/01; 21:45:03MT - usagold.com msg#: 60487) Greenspan was wary of Treasury "initiatives" in 1995 http://groups.yahoo.com/group/gata/message/874 Fed Chairman Alan Greenspan was wary ofTreasury Department "initiatives," 1995meeting minutes show.To subscribe to GATA's dispatches by email and get them immediately so you don't have to go look for them, send an email to:gata-subscribe@yahoogroups.com John Doe (08/29/01; 21:44:17MT - usagold.com msg#: 60486) Canuck In reality, inflation/deflation is spread across multiple areas. I'm not sure if the economy can be characterized as simply exhibiting one or the other or "tipping" from one to the other.That we had and continue to have above GDP inflation of the $US money supply is undisputed. However the effects of this inflation did not, or were not allowed to manifest either broadly or evenly throughout the economy.This past cycle we had inflation in the following price levels (in the US):Stocks (mostly tech and big cap).Bonds (most of the time).Real estate (late in the cycle).Energy (even later in the cycle).Taxes.High tech labor (mid-cycle on).US$.We had deflation of price levels in the following:Most commodities (including the object of this site).Energy (most of the cycle).Low tech labor (flat/down most of the cycle).Most tech equipment.Prices of general "stuff" (mostly due to imports & high $).Foreign currencies.Note that productivity and the CPI were concentrated in the second list, and even then they pulled out food and energy when it suited and allowed faux accounting to hide labor costs esp. in the high tech area.So what was this last cycle, flat, inflationary, disinflationary, deflationary? I dunno. I'd guess mostly paper asset inflationary, with a few interesting exceptions.What's the downleg to look like? My guess, mostly a reverse of the up leg, but occurring on a near-stagnant money supply:Falling prices:Most stocks.Bonds (esp. corporates first, then all eventually).Real estate, slow at first, then faster.Taxes (please, oh please).Labor (across the board, or stagnating at best).Most tech equipment.Autos in general (esp. used & used gas-guzzlers).US$.Rising prices:Energy.Certain "commodities", especially if relatively rare or useful (will gold become "useful" again? -- it better, we're all betting on it!).Prices of "stuff" in general (due to imports vis-a-vis a devaluation of the US$).Foreign currencies.If this came to pass, how would you characterize it, inflation or deflation? I'm sure it will seem like the worst deflation in history to many, but generally, all that is happening is that paper assets are being (finally) discounted from extreme overvalue, and that over-capacity in certain areas (and its attendant labor) is being cleared. Sierra Madre (08/29/01; 21:39:17MT - usagold.com msg#: 60485) White Rose...what to do with some $400,000 US Here goes, with good will, what I'd tell my daughter:1. Get out of debt.2. Put 20% in .999 gold coins, put them away and don't think about them for five years. Store them in a bank.3. Listen to Black Blade: put 30% into Oil and Gas Stocks, and keep listening to what he says, for further hints.4. Carefully investigate "special situations", put no more than 5% into that area.5. Put 5% into John Hathaway's Toqueville Fund of gold mining stocks.6. Keep the rest in a fund invested in SHORT TERM government securities, NO LEVERAGE NO DERIVATIVE MANOUVERS.7. When the S&P index registers a P/E of 12 TO 15, and dividends as a percentage of price are say, 3%, re-enter the market and buy shares in seasoned companies with solid balance sheets and a long record of conservative administration. Buy the shares only with the object of receiving dividend income - not for a possible rise in the price of the stock.This is only my opinion and I am not a qualified investment counsellor. Do your own homework.Hope this is helpful!Sierra Netking (08/29/01; 21:06:31MT - usagold.com msg#: 60484) "Logical Euro" (a move to) backed by UK's Hain http://news.bbc.co.uk/hi/english/uk_politics/newsid_1516000/1516120.stm Snippit:Europe Minister Peter Hain has given another strong indication that the government regards entry to the euro as inevitable. In an interview with the left-wing magazine Tribune, Mr Hain said the euro "was marching on" and that the decision could not be delayed indefinitely. His comments, reported in the Independent, seemed to expand on the official government line that membership of the euro depends on the Chancellor's five economic tests. The euro is marching on and no one thinks the decision can be postponed for ever. But the Foreign Office played down Mr Hain's comments and insisted they did not go further than official policy. . . . Mr Hain said: "The euro is marching on and no one thinks the decision can be postponed for ever, apart from the right of the Tory party. . . White Rose (08/29/01; 21:05:51MT - usagold.com msg#: 60483) Municipal bonds vs. Bond Funds My wife and I recently inherited a brokerage account. It consists mainly of a long list of municipal bonds plus some bond funds and a few stocks.I recall the story of the Heartland bond funds (one lost 79% overnight). The problem was that a new audit changed the valuation of the entire fund because of concerns that the bonds were not liquid enough (i.e. if the fund had to be liquidated, the bonds could not be sold for as much as the previous auditor had stated).The risk for the bonds can be reduced by holding them until they mature. But there is no way to protect oneself from a bond fund that self-destructs. Or so I think.We do hold 400 oz of gold as a hedge if the oncoming financial tidal wave takes out the bond issuer's ability to pay or takes out the value of the dollar.The total value of the brokerage account is just under $400,000. I throw myself on the mercy of my gold loving bear-friends: what should we do with this account? Leave it alone? Sell the stocks? Sell the stocks and the bond funds? Sell everything?Thanks for your help Sierra Madre (08/29/01; 20:50:10MT - usagold.com msg#: 60482) BR5+4=9....definitions.... You ask "What is a pitcher?"-A pitcher is something you put in a frame and hang on the wall.Sorry, couldn't help it.Interstate: the above proves that I am an adolescent...but not a nasty one, at least.About hair: I didn't think that comment about Wim Duisenberg's hair would provoke any reaction at all. And if Einstein had an unkempt head of hair - well, he was, after all: Einstein. I still think that manliness does not combine with foppishness, and Wim Duisenberg looks like a complete fop. Not so Einstein.SierraNB.- Profundity does not preclude levity. Black Blade (08/29/01; 20:32:08MT - usagold.com msg#: 60481) Former Workers at Lucent See Nest Eggs Vanish, Too http://dailynews.yahoo.com/h/nyt/20010829/bs/former_workers_at_lucent_see_nest_eggs_vanish_too_1.html Snippit:Not only are many former Lucent employees out of work, but their savings have largely evaporated because they were stashed in Lucent stock. Many people lose jobs, and many people invest in their company's stock. But the problem is acute at Lucent, which is cutting 30,000 jobs this year. A significant share of those people started at the company years ago, when its operations were part of AT&T, and they came to think of their company as rock solid.Black Blade: Oops! Some people just refuse to prepare. A lot of unfortunate stories here. - Tales from the "Bone Pile" Black Blade (08/29/01; 20:23:35MT - usagold.com msg#: 60480) Tokyo Stocks Lower, Banks Extend Slide http://biz.yahoo.com/rb/010829/business_markets_japan_stocks_dc.html TOKYO (Reuters) - Tokyo stocks opened lower on Thursday as an extended slide on Wall Street hit high-tech stocks, while the key Nikkei average's tumble to 17-year lows rekindled concerns over latent losses in banks' shareholdings. Weaker-than-expected industrial output data for July also hurt Tokyo shares by underscoring the dire situation of the Japanese economy. ``The output results were worse than our expectations. The fact that July figures came lower than the revised expectations of the government shows that the situation is very bad,'' said Shinichi Sato, manager at Tokyo-Mitsubishi Securities' investment strategy division.Major banks fell across the board, extending Wednesday's sharp slide, which came after Financial Services Minister Hakuo Yanagisawa said the outstanding balance of bad loans at major banks would likely remain near current levels through fiscal 2003.Black Blade: Hello! What's this? Black Blade (08/29/01; 20:17:29MT - usagold.com msg#: 60479) Asia Getting Slaughtered http://quote.yahoo.com/m2?u Here we go again. This time it's a race between the Nikkei and Hang Seng for sub 10,000. Japanese banks are getting creamed now. Rumors of insolvent Japanese banks with perhaps trillions of yen in nonperforming loans persist. This could be the next scandal to break the Nikkei. We wait to see what unfolds. Black Blade (08/29/01; 20:13:55MT - usagold.com msg#: 60478) Forbes Body Count http://www.forbes.com/2001/01/30/layoffs.html "Dem Bones" keep piling up. Canuck (08/29/01; 20:08:04MT - usagold.com msg#: 60477) @ site steward Funny.....I saw Mr.Asher old post today as well and noted the 'waiter and Uncle Sam conversation'.Very basic question about the 'flation debate. I feel if the oversupply of money 'chases' the undersupply of goods first one might expect inflation. Conversely, if an undersupply (is there such a thing?) of money 'chases' an oversupply of goods deflation occurs. So we had (say in the last few years) a huge supply of money 'ahead of the goods curve' creating modest inflation.Now we experience an inventory glut, a la deflation above.In its simplest form, can one parallel inflation/deflation to leading and lagging supply of money/goods. Sort of a ratio; a perfect matching of above would result in a quotient of 1, above one inflation, below 1 deflation.I think I'm blabbering now. megatron (08/29/01; 19:52:38MT - usagold.com msg#: 60476) SA Gold swaps 1 down, many to go. R Powell (08/29/01; 19:22:05MT - usagold.com msg#: 60475) Site Steward The information you gave yesterday (60410) concerning the a weaker dollar leading to inflation was printed on page A2 of today's Investor's Business Daily. "Cleveland Fed. to manufacturers: Weak dollar won't cure your ills" Randy, you also said that you were contacted "with regard to a specific subject matter" which you then declined to elaborate on. I've always thought one should not ask trivia questions that one can not answer. Or, Okay, we give up. What's the big secret that you said you have and we can't guess?? At least some hints! You know you want to tell. Rich site steward (8/29/01; 18:51:50MT - usagold.com msg#: 60474) Reply to Belgian (msg#: 60460) on the "Washington" aspect of the WA The only thing I'm comfortable saying about the role of Washington within the "Washington Agreement on Gold" I put forth in yesterday's note on the subject addressed to Cavan Man and auspec. Perhaps you already saw it? (msg#: 60422 near the end of the day)Regarding the specific points you raised about intercontinental (transatlantic) agreements and cooperation on timeliness of gold/money/oil/settlement events, I must say that reading the commentary of FOA at the Gold Trail is the best insight I expect to find anywhere about these matters as the days unfold. I invite you to join me reading the Trail.R.PS. On an additional, unrelated note, I've noted the special attention paid today to comments by Bundesbank President (an ECB council member) -- "The best contribution monetary policy can make to growth and employment lies in stable prices." This primary focus on "price stability" has been the official "company line" of the Bundesbank for many years (the bank having been formed after WWII with fresh memories of national monetary hyperinflation), and this policy of price stability as a "guiding light" has only recently, in the past several years, gained the consensus of central bankers everywhere. As administrations change, you tend to hear subtle variations on this theme, always couched within the requirements of any binding legislation.Case in point. For America's part, the Employment Act of 1946 and the 1978 Full Employment and Balance Growth Act define the Congressional mandate put upon the Fed as expectations for the Fed Board of Governors to pursue the following: objectives of economic growth commensurate with the economy's potential to expand, high level of employment; price stability; and moderate long-term interest rates.Anyone who knows a thing or two about "free market" economic systems knows that a bank has no direct ability (outside of hiring additional persons for their own staff) to dictate high levels of national employment. Responsibility for that outcome is more properly found in the hands of those policy makers with jurisdiction over the national framework of laws that influence the suitability of the economic climate for businessmen and entrepreneurs. A wise central bank realizes it can only contribute to full employment insofar as it helps to foster such a suitable environment through the elements that it CAN influence. In this regard, working toward price stability is the proper means toward that (improperly legislated) mandate of full employment.This is what I was driving at in my #60410 post yesterday where I said, "At the end of the day, the most we can reasonably expect of our monetary officials is to conduct policy in such a way that shall foster a monetary/banking system conducive to general price stability, the economic foundation upon which individuals and businesses may plan for the future and grow."It is in the central banks’ interpretation and subtle articulation over time of their various legislative mandates that broadcasts to each other and to careful observers the intended or likely thrust of their official actions. Through this you may begin to better understand why Mr. Welteke would trouble himself to articulate the following (as was adeptly picked out by FOA). Welteke said, "Firstly, it isn't the ECB council's mandate to steer economic growth, but to stabilize the value of money. Price stability is the top goal of the European System of Central Banks. The U.S. Federal Reserve has a mandate that includes growth and employment targets. Secondly, the ability to fine-tune economic growth is obviously being overestimated, and the time lag for monetary and fiscal policy impetus to take effect is obviously being underestimated."In an obvious (now that you know what to look for) attempt to mitigate the apparent effect of this legislative shackle upon proper and efficient monetary policy (at least in the eyes of their peers) we may occasionally see the Fed offer comments similar to the that offered in 1991 by then Fed vice-chair David Mullins. He articulated "our primary goal is to maximize growth," which was his obligatory nod to the Congressional mandate, followed closely by the statement that "price stability is a means to that growth."Clearly, Bundesbank President Welteke would be more comforted to hear an alternate variation of those words, perhaps as such: "within the latitude of our multi-objective Congressional mandate, we pursue the objective of price stability as our key means toward the practicable advancement of economic growth and full employment." Note the subtle difference? But again, those are my words, not the Fed's.As it is, if Congress holds the Fed to task for stimulating economic growth and full employment (something that the Fed does not have the power to do beyond fostering stable money as mentioned above), then political pressure will call upon the Fed to ease monetary policy beyond the bare minimum otherwise needed to keep the banking system liquid through the current economic downturn. A central bank can only save solvent banks suffering from temporary illiquidity, it cannot by itself stimulate sound employment and growth through monetary policy. The fact that Congress might feel that it actually CAN is quite unsettling, particularly if you are willing to forecast a reasonable vision of the consequences of imprudently lax policy measures.Waiter: "And for you, sir?"Uncle Sam: "We shall have the hyperinflation."Waiter: "As you wish, sir."R. Canuck (8/29/01; 18:34:20MT - usagold.com msg#: 60473) @auspec Excellent points. My first impression of the WA statement (limit gold sales to 400 tonnes/year) was very negative. I still don't understand the spike. If the 'union' was already selling in that neighbourhood what difference does/would the agreement make? In terms of the leasing what concrete evidence do we have that it has stopped?It seems the WA 'leasing' and 'limits on sales' is being superceded by 'swaps' anyway. This brings me back to a question I asked a year ago. Are the 'non-friendly' CB's on a swapping merri-go-round? That is to say that A swaps with B, B to C, C to A? The impression can easily be made that piles are being sold. What if the CB gold still remains in the order of 33,000 tonnes? What the hell is REALLY going on. I think we are being duped(at least to some degree). There is a key piece to the puzzle that we are missing. I hope GATA's upcoming bombshell brings this to light.Canuck. auspec (8/29/01; 17:38:47MT - usagold.com msg#: 60472) WA Continued site steward and ALL Please bear with me as I re-think through this 'watershed event', the WA, a little more retrospective clarity should be most beneficial. I certainly know the announcement was/is important, please don't misunderstand, but WHY exactly was/is it such a claimed 'turning point'?The announcement that gold shall remain an integral monetary asset is close to meaningless, gold is the one who decides which bank/country/entity has a glittering future, not vice versa. What has been done differently by these 15 countries in relationship to the significance of gold to their monetary policies since September of 1999? Still 'leasing w/o policing' it seems {I'm a Johnny Cochrane wannabee}.Does it simply come down to the supposition that these 15 countries won't unload the entire hoards? Most gold officionados seriously doubt that countries are stupid enough to go to that level anyway.Some believe the WA has given a clear line of demarcation between the gold 'holding' countries and the gold 'dumping' countries. That's where I need more clarification! These 15 countries love their gold so much that they stand idly by while the BIS, IMF and other CB affiliates perpetuate the fraud of gold manipulation? What wonderful Au allies, eh? Maybe they simply patiently await the inevitable. If there is some huge chasm between various CB elitists, the boundaries are beyond muddled, at least to this advocate.Was the WA simply stating 'this much and no more', yet really meaning 'this much and more PRN'? France as the ringleader?So many questions, yet it all comes down to this: What in retrospect really makes the WA such a crucial dividing point in time?Thanks in advance.auspec BR549 (8/29/01; 17:30:12MT - usagold.com msg#: 60471) The Value of the Dollar— I maintain that if the value of the dollar is expressed in US$, then the definition is redundant. What is the value of the EURO? It is worth x amount of FRN's? What is the value of Gold? So many FRN's to the oz. What is the real value of the $? If you use a word's definition that means the same thing, then the definition does not mean anything—What is a Pitcher? A Pitcher is someone who pitches doesn't really define what the definition of the word pitcher is. Likewise to say that the value of the dollar is---What is a dollar? A Dollar is what dollars will buy in dollars, or gold, or other currencies, is the same thing. Equally as worthless is a definition is the valueless question of what is the value of Gold if the value of gold is what Gold is worth in dollars. I maintain that all CB's worldwide mutual goals are to stabilize the value of their money. Why, the Price stability of their currency against the value of the dollar is the top goal of ALL of the Central Banks for the benefit and maximum profitability of their banksers.When AG writes his memoirs a few years from now, he will admit to the Fed policy of attempting to maintain an unofficial gold standard of the last few years of $275/oz. +-.Why? Because the U$ wanted to maintain the value of the US$. To stabilize world currencies. Why? You know why.As long as we think in terms of value in FRN's, instead of gold, then we will never know real values. Let me go comb my hair, clean my glasses, put on a clean shirt, and I'll post this. Solomon Weaver (8/29/01; 17:26:00MT - usagold.com msg#: 60470) Silver http://www.itds.treas.gov/prec_metals.htm "Most of the silver comes from Mexico, Peru, Canada, the United States and Australia (ranked in order of total production). Obviously, the Americas have near monopoly on silver production. It is estimated the total world silver production since 4000 BC is about 40 billion ounces - which compares with the world's gold inventory of approximately 4 billion ounces. China ranks as the number one world consumer of silver - nearly all used in the photography industry. Silver's price hit an all-time high of $52.50 per ounce in 1980, subsequently falling to its recent history low of $3.51 in 1991. Among the most prominent precious metals (gold, platinum and silver), silver tends to be the most volatile in price. In the 1979/80 precious metals bull market, silver's price increase was double gold's. And during the 1982 price surge, silver tripled gold's percent price increase. In the 1985/87 rally, silver just nosed out gold (96% to 79%). However, silver's percent run-up in the 1993-bull market was again twice that of gold. "International Trade Data System.............Interestingly enough the author compares silver's total production history of 40 billion ounces to the "inventory" of gold. What he doesn't point out is that over 90% of that silver seems to have been used.No big surprise that over half of the worlds historical production of silver has been in the last 30 years....at the same time, we have continued to use up any and all freely available stock.....o.k....so now, we come to the next 30 years....where we need to make about 300% more high tech products than we did in the last 30 years, as we bring the poor into the mainstream....like building enough Digital Cameras and computers to eliminate all those paper photos.poor old silver solomon Netking (8/29/01; 17:05:59MT - usagold.com msg#: 60469) Rich. / Ag bugs I read your weekend post, another good one from you Sir Rich. The PRC answer may namely be that yes (per WSS report) there is some going out by way of export from the PRC from the Co's that refine silver concentrates then export these to the world market, maybe this is just counted as "PRC Silver Exports" period? We would need to check how much is coming into the PRC by way of concentrates first to assess the net movement in/out. Hence the reports export figures may indeed and probably are accurate but this may not include any "Central originated" sales. There is too much current & upcoming demand for silver for the PRC to be dumping from "Central Stores" at 5,000 year inflation adjusted low's in the POS(IMO) especially for the benefit of it's main "rival". Solomon Weaver (8/29/01; 17:02:30MT - usagold.com msg#: 60468) Fortune says send to a friend...so friends....mainstream press noticing http://www.fortune.com/indexw.jhtml?channel=artcol.jhtml&doc_id=203713 CONSUMER DEBTHoney, Can We Afford It?U.S. consumers are keeping the world economy afloat. But they're up to their eyeballs in debt. FORTUNEMonday, September 3, 2001 By Anna Bernasek Send to a Friend Print Subscribe to Fortune In ancient times, of course, no one had access to credit cards. So when Damocles wanted to attend a sumptuous banquet at the royal palace, he had to agree to some unusual terms. To teach him a lesson about the perilous nature of his desires, King Dionysius had a sword hung from the ceiling over his seat, suspended by a single hair. For the entire feast, poor Damocles had to remain in that precarious position, which would wreck just about anyone's appetite. Today some economists think the U.S. economy is experiencing its own sword of Damocles: consumer debt. Just as agreeing to sit under that blade allowed Damocles to partake in a feast he really couldn't afford, record consumer debt has enabled consumers to buy--and keep on buying. Now, with business spending, the stock market, and major world economies all in retreat, American consumers alone are keeping not just the U.S. economy but pretty much the whole darned globe afloat. If they handed out medals at the U.N. for such things, American citizens would surely be in line for one. Let's hope it lasts, because if for some reason Americans stop borrowing, consumer spending will crumble and there will be absolutely nothing between the world economy and one very ugly recession. Worse still, an avalanche of household defaults followed by tight credit could make any downturn drag on--and on and on. So the question is: With the entire world economy perched so precariously, will U.S. consumer debt deliver the final, crushing blow? Probably not, but before we get to that, let's look at the facts. Consumer debt has sailed into uncharted territory. Household borrowing had been growing steadily since the mid-1980s before positively exploding during the last decade. It now stands at a record $7.4 trillion, almost double what it was at the beginning of the 1990s. Interest payments as a percentage of income have jumped from 2.2% to 3.2% since 1995 even though interest rates themselves have been falling. Debt service as a percentage of income is close to 14.5%, another record. And for the first time in history, American households are carrying a debt burden equal to their combined after-tax income. Obviously, there's a level at which debt-fueled consumption suddenly stops helping and becomes really, really bad for the economy. Trouble is, no one is sure exactly where the tipping point is, which makes it awfully hard to predict how this whole debt thing is going to play out. What we do know, however, is that it doesn't necessarily have to end badly. In fact, there's good reason to expect that households can get through this period intact. For instance, falling energy prices, tax cuts, and lower interest rates are doing pretty much what you'd expect them to do--boost household income. Even on the employment front, which is the biggest threat to household finances, the outlook is fairly promising. Data for July showed that the number of jobs in the economy was still contracting, but at a much slower pace; meanwhile, the unemployment rate--4.5%--remained near its historic low. And while household net worth has fallen 10% in the past 12 months, it's still close to an all-time high--an impressive $41 trillion, 20% above the historical average. There are plenty of other reasons to be chipper, and we'll get to them soon. But first let's look at what can go wrong, which, unfortunately, happens to be a lot. For one thing, such extraordinarily high debt levels have made consumers much more vulnerable to financial stress. "The American consumer is like an athlete on steroids," says Robert Manning, author of the book Credit Card Nation and a professor at the Rochester Institute of Technology. "He's artificially pumped up and not as healthy as he looks." There are already indications that financial stress may be on the rise. Credit card delinquencies are at their highest level in almost nine years, and personal bankruptcy filings are increasing. Some groups are more at risk than others. Low-income households in particular have borrowed up a storm, and one-fifth of them are now classified as heavily indebted (with debt payments above 40% of income), according to the Federal Reserve Bank survey of consumer finances. Homeowners may have taken on a greater risk too. The rule of thumb used to be that a household spent at most 20% of income on rent or a mortgage. Now one in five two-income families is spending more than half its income on housing. Clearly, these folks need to rein in their borrowing, but if less leveraged consumers also suddenly lose their appetite for debt, the slowdown could take a turn for the worse. In June, U.S. consumer borrowing fell for the first time in 3 1/2 years. And that may already be having an impact: In the second quarter, consumer spending moved back in line with income, after running ahead by about half a percentage point for much of the past decade. The savings rate has also leveled off after years of decline, a sign that Americans are paying more attention to their finances. "There are limits to how much debt people are willing to take on," says David Levy, chief economic forecaster at the Jerome Levy Institute, "and we could be nearing that point." If consumer debt really has stopped growing, it would be hard to match the eye-popping GDP gains of recent years. And in a recession, households may default, setting in motion another negative cycle. R Powell (8/29/01; 16:57:27MT - usagold.com msg#: 60467) Hello Interstate Interesting name. Are you a traveller of the states and do you, perchance, travel on 18 wheels? I've promised myself and the misses that we will travel the country right after either POG reaches $800 or POS reaches $30. Either or will do. Sierra Madre, Your hair comment immediately brought to mind a picture of Albert Einstein with his totally unkempt look. Rich auspec (8/29/01; 16:29:27MT - usagold.com msg#: 60466) C.M, stew & Belgian/WA Thanks, all, for your input on the US {lack of} reaction to the WA. As much as this topic has been thrashed over, I still think there is a message behind this lack of official response. When these players act different than their history and nature predicts they would act, we are best suited to 'keep our eyes peeled' for the reasons.Most assume that the US was caught off guard by the WA, but we must remember this was the Clinton Administration in office at the time. They called out their spinmeisters with regularity, and if they were not party to the WA, or if it was really that devastating to them, we would have clearly heard about it. Does anyone remember an official response, I surely do not?Again, if there was any meat behind this 15 country announcement they would have ceased leasing altogether or curtailed it substantially. Didn't happen. In retrospect it looks like a simple gold allocation process 'contract' that so many have esposed. What did it really change, as this process was already ongoing? It certainly scared the shorts off a few pants {vice versa}, but order and decency was quickly restored. The gold investigators were able to pick up all the clues left from this short lived panic and its extinguishment, thank you. The manipulators are finding fewer and fewer places to hide, dark rocks notwithstanding.More thoughts on the way subsequently,a R Powell (8/29/01; 16:26:38MT - usagold.com msg#: 60465) Netking and silverbugs Thanks for the silver info (60434) and link. It mentioned mine shutdowns, sales from China and disenchanted investors selling (throwing in the towel). These were all touched on briefly in my 8/26/01 post reporting on some of what I found in the World Silver Survey. (Sunday post 60281) The article you refered to states that China is not selling silver but rather importing silver which is used to manufacture an export containing silver. The Survey states, many times, in no uncertain terms that China is dishoarding. Perhaps there is truth in both opinions? I've encountered this type of dubious reporting in cotton where cotton is exported to Caribbean based but American owner mills to become fabric which then re-enters the U.S. Should the raw cotton leaving be catagorized as an export and the incoming fabric as import simply because the cotton left the bounds of the country (to be processed with cheaper labor). Neither the cotton nor the fabric ever left American ownership. This confuses the import/export story in cotton and gives conflicting numbers depending upon who you listen to. Concerning mine closures, I remember seeing that Apex Mining had been put on hold due to the poor silver price. Apex is the mine Soros is developing (he owns a good piece of it) in the Bolivian Andes. Both the report you link to and the Silver Survey agree that investors have sold having become tired of waiting for profits. Isn't this a sign of a market bottom?? I hope so! Rich Netking (8/29/01; 15:35:38MT - usagold.com msg#: 60464) Galearis / Belgian Sir Galearis(60448)Good comment & welcome back Sir. You can swap that Canadian climate with mine, now! The silver physical supply & damand dynamics WILL sooner or later drive this market out of a comatosed manipulative impasse, I believe(IMVHO)it will be sooner.Sir Belgian - Good to have your Euro spin on things back here too after your time away with nature. Any reports from the brother in law in the M/E? Interstate (8/29/01; 15:26:04MT - usagold.com msg#: 60463) @Sierra Madre If you get upset about someone's hair and glasses, then please let me send you a reading list of things to REALLY be concerned about that will/may affect the lives of all of us. I work with adolescents and it seems to me that the adolescent is Sierra Madre.This is not meant to sound sarcastic, only surprise at your post because you normally write about your good ideas and far thinking thoughts. (I am a long time lurker.) Belgian (8/29/01; 14:51:55MT - usagold.com msg#: 60462) Reactions Randy : forgot * Tanks * for your gentle mentoring !Old Yeller : As a student, I found that <professor> /// ?? /// again a very typical example of a Gold-illiterate. Much relieved that Sandsprings, reacted appropiately on his rambling. This professor can join SteveH's money-journalists. (nice post SteveH). Econoclast : Love your // one man, one ounce //.But let us change this Universal Gold Insurance into a 3 month survival kit. 3 x 1.000 $ = 3.000 $ or a minimum of 10 ounces at present paper value. Do remember that all US citizens together collect 1 Trillion $ per year on interest rate-income, on their bonds. Suggest that they all invest these interest income this year, on gold and buy the global stash of 140.000 tonnes in one go ! Oh boy. (140.000 tonnes of gold at 300$/ounce = 1 Trillion $)Tommy P: South Africa/WGC/Miningweb/and much others...just think, strictly *MINING* . They stubbornly refuse to think** GOLD ** ! I made the same terrible mistake !!!! The difference is that I've changed my mind drastically in contrast with for example WGC, that has changed, previous automatic mailings with additional loads of miningnews, at present. Their product is of permanent diminishing importance. They probably risk one day to forget that their product is *GOLD*. Oh irony !Eurobedtime site steward (08/29/01; 13:59:31MT - usagold.com msg#: 60461) Fed adds permanent and temporary reserves today Through the outright purchase of Treasuries, the Fed added $456 million to reserves to the nation's banking system on a "permanent" basis, while it also conducted overnight repurchase agreements to temporarily add $4.25 billion to reserves.Overnight liquidity was a wee bit firm, fed funds trading at 3.56 percent.R. Belgian (08/29/01; 13:56:18MT - usagold.com msg#: 60460) @ Randy Yes Sir, I do see my mistake of looking as an european with my nose, too close, at the € first and Gold as secondary.It is the other way around. Clever you !Auspec mentionned the Washington element in the W.A. and my hasty answer is bottering me somewhat. Did the euro-builders and the hyperinflation-victim (US$) agreed on something like a timetable for sharing (managing) an orderly transition ? The US$, knowing very well that it has reached the end of its timeline an stricking a deal with the well prepared euro-builders, asking the dollar not to exaggerate on the Gold-Management ? Only a non-binding gentlemens agreement of course, where both (€ + $) retain the right to change ideas along the path ?The old dollar (to be dethroned) is buying and getting some time to make the necessary arrangements with the cheap oil providers, to compromise on oil flow ? A case of mutual interest with a healthy dose of egoism and distrust in a non confrontational atmosphere. That's how I should have been doing it.The reason for this thought is that IMVHO, POG should already have showed an anticipating behaviour on things to come. POG-rise for € defense and disposing off from dollar-reserves.€/$ relation is too peacefull in proportion to what's at stake. Belgian (08/29/01; 13:20:03MT - usagold.com msg#: 60459) The next decade http://www.urbansurvival.com/week.htm Intuitively, we all feel that we are rather at "the end" of something *old* and not at "the beginning" of something *new* . Kondratieff cycles try to find the peaks and troughs in this cyclic waving. Some more at the above link about China and Debt for the next decade. And all this non dogmatic and very open minded. Nice work ! Econoclast (08/29/01; 12:58:23MT - usagold.com msg#: 60458) That was a large and sarcastic question mark at the end of my last post If a currency is subject to management/manipulation through its fiat character, it will be when it becomes necessary or desirable to do so. Let's not forget that "the new boss is same as the old boss".If Americans could be educated/re-programmed to believe that every person should hold even just one ounce as their own personal reserve, we would outweigh the federal reserve.There's not enough gold in the world for every human to have a one ounce reserve. Old Yeller (08/29/01; 12:57:16MT - usagold.com msg#: 60457) This is good,very enjoyable read http://www.sandspring.com/charts2001/cdj082901.html Barclay Leib takes the hedge trimmer to the eminent Professor Dornbusch.Pretty sound refutation of an article that seemed to take liberty with historical fact and the reality of the present dubious monetary system.Nice chart to boot. Rockgrabber (08/29/01; 12:56:48MT - usagold.com msg#: 60456) New concept for a nations money 1.) Bundesbank, "The best contribution monetary policy can make to growth and employment lies in stable prices. 2.) Mr Welteke, "The ECBs goal is not to steer economic growth but to stabalize the value of money". 3.) then the French accuse the U.S. of "American economic and cultural hegemony". With pressure building on the U.S. economy and our dollar, gold will soon be the weapon to release. Its just to bad you cant leverage the stuff. Physical gold is a leverage play. Matter of fact right now PHYSICAL GOLD IS THE DERIVITIVE. Its price is reliant on the Paper market, therefore making it the derivitive the way I see it. site steward (08/29/01; 12:56:24MT - usagold.com msg#: 60455) Thoughts for Belgian on element of "time" You proposed rightly enough, "If the euro has the ambitions to dethrone the dollar in its reserve function...it will take some time."Imagine this alternative as food for thought.Just for the pure joy of a thought exercise, allow yourself to imagine that the "euro-builders" do not aspire for the euro to become a fully fledged reserve asset. That is to say, imagine they to not seek to have it *replace* the replace the dollar in reserve function as was seen under the past international system.Simply put, imagine that it is only a more level playing field that is sought -- dethroning the paper dollar reserve function simply to eliminate the privilege it bestows upon a singular nation.And here is the point. Certainly, it would take time for the paper euro to rise in stature (and confidence) as a usurper to ascend the throne in the role as "reserve asset". Gold, however, as a "free agent" has the stature to assume this reserve role immediately -- in the turn of a page.What could the "euro-builders" aspire to if they know that gold can be the unassailable king of reserves -- form and function? Let's think about this...If hyperinflation lies ahead for U.S. prices as the dollar loses its international reserve throne to gold, I imagine the euro-builders would feel content in filling the international role of "price denomination" as the dollar fails to provide this meaningful "measurement" function.It seems to me it would not take long in the international sphere for marked-to-market gold to replace the dollar (and all other paper assets) in reserve function. And now nearly at parity, it would not be overly difficult for "euro" to replace/dethrone "dollar" in price denomination. From there, everything follows as we live day by day...Again, food for thought on the possible speed at which we may adjust to a new reality.Just me, walking the line. Fact or fantasy? You decide.Randy Tommy P (08/29/01; 12:44:53MT - usagold.com msg#: 60454) Gold Swaps...Yes says S.africa http://m1.mny.co.za/MGGold.nsf/Current/4225685F0043D1B285256AB7005EE162?OpenDocument&ByLine=Tim+Wood Well at least someone admitting it, oh but with who?? Belgian (08/29/01; 11:56:48MT - usagold.com msg#: 60453) Welteke - ECB ** To stabilize the value of money ** (the €)A wonderfull and almost perfect " intention ".But, what if the economic reality detoriates and political social-oriented Europ can't deliver and satisfy the welfare demands ? In the recent past, all growth in state-debt has been slowing dramatically. But what if this evil puts up his ugly head again ? Only adjusting Gold-Valuation can compensate and signal for unison discipline.Managing a currency is not that evident under political (economic) pressures.If the euro has the ambitions to dethrone the dollar in its reserve function...it will take some time. The state of the global economy might complicate that transition. How will the inevitable shock(s) be adsorbed or buffered ? Euro-action and dollar-reaction will be played around Gold and Oil. Who will change ideas during the process ? site steward (08/29/01; 10:42:02MT - usagold.com msg#: 60452) Dow and Nasdaq both down a percent, more to come? http://www.usagold.com/goldenchalkboard/gc_stockbubble.html Iin case you missed these charts yesterday, have a long, lingering look.Then give Centennial a call for a friendly chat. It's toll free!R. CoBra(too) (08/29/01; 10:22:39MT - usagold.com msg#: 60451) The Statist a Re-Visionist? SM's seem to expect another revision of the Qu2 GDP revision - here's to the (re-)visionaries of the global economy. Helmut Kramer, one of Austria's contemporary, though respected economists got 20 Minutes of prime time TV news today. His forecast for the global economy has been dismal, as he recounted economies around the globe contracting, while the rest is at the brink of recession. He went on toexplain that in the past 20 or so years recessions have been more or less contained locally, as better faring economies were able to bridge any slowdown. This time it's a global phenomenon and the EU's stabilization (convergence) criteria are already under siege. Seems to me the IMF global forecast 2002 revision may still be a tad optimistic. Grim! As BB says - while I remedy Karen Sue's electronic soup kitchen lines. Grim, but true - cb2 Sierra Madre (8/29/01; 09:55:28MT - usagold.com msg#: 60450) Wim Duisenberg, Prez of ECB Good Lord! How I wish that clown would GET A HAIRCUT!With that foppish head of disheveled hair, carefully blown dried, and glasses that purposefully are on the point of falling off his nose...all he needs is an earring to fill out his "image".Wim - looks like you'll never GROW UP! - An adolescent is President of the European Central BAnk.Sierra Econoclast (8/29/01; 09:44:18MT - usagold.com msg#: 60449) A VERY revealing statement by the head of the Bundesbank ``The best contribution monetary policy can make to growth and employment lies in stable prices.'' And we all know what form of money/monetary policy leads to stable prices.Euro...good as gold? Galearis (8/29/01; 08:42:42MT - usagold.com msg#: 60448) @ Netking re silver It is nice to be back from our seasonal wilderness excursions so I take this opportunity in this single post to say HELLO! again to the forum. Amazing summer really with those endless days of 90 degree temps up in boreal Canadaland.The CPM piece is a breath of (logical) fresh air in a plethora of disinformation and spin. Thanks for posting this. On the other hand, as we all know, in the land of pms where firm information is often corrupted by vested interests in selling and marketing of a competive product or to cover indescretions, one can only hope that this time the logical is the reality.In the back of ones mind a little voice keeps piping up with the reminder that in this derivative driven market environment (and especially the pms) low prices are not real and all will ONLY change when the fundamentals of supply and demand assert themselves ABSOLUTELY. In other words when supply ABSOLUTELY runs out. It is the only way to retain the faith. Sometimes what goes around doesn't come back. (smile)Bestest of regards,G. escapethematrix (8/29/01; 08:20:03MT - usagold.com msg#: 60447) France attacks America's high-handed unilateralism http://www.guardian.co.uk/international/story/0,3604,543586,00.html Snippet:The French foreign minister, Hubert Védrine, accused the United States of self-interest yesterday and said that the Bush administration was hindering the international community's efforts to solve the problems of globalisation. In the latest Gallic attack on what is politely referred to in France as "American economic and cultural hegemony", Mr Védrine told French ambassadors in Paris that France would pursue its efforts towards "a humane and controlled globalisation, even if the new high-handed American unilateralism doesn't help mattersThe propaganda war heats up....France seems to be gearing up for their boy to take over for Mr. D....The fireworks should begin with France's ascension to ECB leadership. Tommy P (8/29/01; 07:16:28MT - usagold.com msg#: 60446) Yeh what ever? http://quote.bloomberg.com/fgcgi.cgi?ptitle=Top%20Financial%20News&s1=blk&tp=ad_topright_topfin&refer=topsum&T=markets_bfgcgi_content99.ht&s2=blk&bt=ad_position1_topfin&middle=ad_frame2_topfin&s=AO4zgSxURVS5TLiBF Revised forecast...mmmmm Black Blade (8/29/01; 06:33:26MT - usagold.com msg#: 60445) API gasoline stocks slide on bumper demand Snippit:NEW YORK, Aug 28 (Reuters) - Another week of bumper driving demand pulled U.S. gasoline stocks sharply lower last week, the American Petroleum Institute (API) said on Tuesday. Gasoline stocks fell 6.8 million barrels in the week ended Aug. 24 to 196.3 million barrels, pulling supplies nearly 3 million barrels below this time last year, the API said in its weekly supply report. Implied gasoline demand rattled along at 9.5 million barrels per day (bpd), only 200,000 bpd below the previous week's startlingly high figure, and some 600,000 bpd above this time last year. Gasoline stocks in the Midwest region -- where supplies are running short since an explosion brought Citgo's Illinois refinery down for six months -- fell 1.8 million barrels to drop 5.9 million barrels, or 11 percent, below last year. Black Blade: This bit of information could get lost in today's shuffle. Very important - API stocks are very low and OPEC production cuts go into effect next week.FLASH - GDP up 0.2% - Baloney! - Somehow I knew it. Looks like the markets will run higher today - The trap is set! Black Blade (8/29/01; 06:24:44MT - usagold.com msg#: 60444) IMF to cut global forecasts http://news.bbc.co.uk/hi/english/business/newsid_1514000/1514418.stm Snippit:IMF reportedly believes the outlook for 2002 will be tough The IMF has cut its forecast for world economic growth this year to 2.8% from 3.2%, Reuters reported on Wednesday citing unnamed sources at the international lender.Black Blade: They had better "cut" again! RE: Old Yeller - Thanks, we shall watch ominous events unfold and prepare for the coming storm together. Cheers!Gotta go help keep the lights on in Kalifornia. Black Blade (8/29/01; 06:19:34MT - usagold.com msg#: 60443) Economist Predicts That Recession Will Become Official on Wednesday http://news.excite.com/news/pr/010828/ca-rosen-recession Snippit:BERKELEY, Calif., Aug. 28 /PRNewswire/ -- A noted economist predicted today that the Federal Government's revised Second Quarter GDP growth number scheduled to be released on Wednesday morning will be negative -- thereby signaling that the U.S. economy is officially in recession.Black Blade: We will see in 15 minutes! I don't care about the "official" number, we are already there as I have been saying. Hang on for the ride! Gold Trail Update (8/29/01; 06:09:55MDT - Msg ID:60442) The Gold Trail Discussion has been Updated The Gold Trail Discussion has been updated. Click on the link to read the latest updates. Belgian (8/29/01; 04:24:34MT - usagold.com msg#: 60441) Tim Wood....Mining Web....South Africa..... **** If POG is being managed, then there is no greater testament to its importance ****Well, well, well, well...oh dear !At last, a mouse-step forward, from a voice out of the oldest and greatest Gold-Heavon on earth, South Africa .Suddenly, Gold, seems to be something more than fine jewelry. Isn't it sad, very sad, that non-South African people (the Gold Heros) have to come up with difficult to obtain evidence, to defend, that Gold blessed nation ! ?BTW, are SA-citizens allowed to hold physical gold in possession and how much of it is hidden in their snake pits ?Paralysing Anglo-American ...ism ? Feel free to fill in the dots.Recently, I saw a documtary on North Korea. Millions of lilliputans who suffer deeply and are in the impossibility to do something. The nano thickness of *civilisation* was perfectly reminded to me. These millions of good people are also managed for the best...Manage your own future now, with the warmest of all things, was something, I wished these people to hear. Sir Zen and the idea of F-or O-r A-gainst. Spread his Thoughts and watch the different types of smilings of the listeners.Think y're gone meet some happy people, don't you ? Right, I'm one of them.:-))) SteveH (8/29/01; 03:46:45MT - usagold.com msg#: 60440) Auspec and USUL You ask where the post from Another is?I have seen several posts (in fact I posted one I caught over at Kitco). Usul believes, I think, that this may be a bogus post. Certainly it lacked the cryptic style of Another, but I sensed an authenticity in the message. Oddly no one but USUL commented on it, and a short one it was.The message was definitly in the mold of both FOA and Another. These other boards are not off-limits to him or her. It is possible that it was Another post. But like USUL I have my doubts too. SteveH (08/29/01; 03:30:42MT - usagold.com msg#: 60439) A note to TV MONEY Journalists The pattern is like this: TV Financial news show invites guest economist to speak on the economy. They naturally invite a large financial institution, brokerage house, or fund manager person to 1) discuss the outlook on the economy and 2) suggest any stock picks. Different now is the manner in which the commentators ask the person if they own any stock or they show the record of the person's last picks months earlier. The prevailing issue I have with this approach to these financial gurus is that they all seem to have an interest in maintaining the bull market at its current level. The market, they claim, is due for a turnaround only a few quarters away. Just a few more quarters and we will see the big turnaround, we will. Yes we will. Perhaps I didn't notice this solid forward looking prognosticating stock market before, but were it to really have that forward looking ability, would it be at the level it is at now had it prognosticated properly this quarter and the last few? I think not. So, are the media money moguls feeding us all a line by choosing wisely (or poorly as the case may actually be) their guest economists who will not break party lines with this prevailing belief that just a few more quarters and we should start to see a turnaround in the markets and therefore this is a good juncture to "be positioned" or "weighted" in some of this and in some of that stock? It would seem so.The problem with this approach to TV money evangelism is that no one wants to admit something that may lengthen the dilemma, therefore the TV money people find themselves in quite the quandary. It seems that slowly but surely they are realizing that they can't always have guests who talk their book and support the market through unrealistic claims of turnarounds that don't seem to materialize. Soon we will be witness phrases by these folks that follow this logic. "Market analysts predict that the economy will briskly turnaround first quarter 2003. Today the DOW and NASDAQ both rallied on this better than expected news. Today CISCO stock went up 2% in anticipation of 2003 future sales." Sadly, we are witnessing similar events by the day. This cheerleading by the TV financial folks of the markets is a great disservice to many investors and may be the root cause of the many lawsuits that investors are beginning to file in earnest against some of these financial pundits. Frankly I am surprised that we have not heard more of suits against these TV shows for the choice of the people they have aired over the past several years. I guess they can claim First Amendment protection against having allowed their guest speakers to push stocks and market indices that have lost significant value. Perhaps this is right, but somehow I believe that the First Amendment won't protect them because cheerleading markets to unsuspecting investors has cost lots of people billions of dollars. I detect in TV Financial Hosts a concern over some of the advice their guests have given over the past years and see stories of accountability and responsibility but none of it is directed at themselves -- only at others. It is time for these shows to stop the cheerleading and to stop hiding behind the veil of journalistic independence and unbiased reporting, because what they are doing and have done is simply cheerleading stocks and bonds as the best investments period. When people can't make money in the short term, they say, "Hold for the longer term." When money is to be in the short term, they say, "Might be good for a quick trade." "Stocks have historically gone up. Some indices have performed better than the rate of inflation for 30 years." Well, Mr. and Mrs. TV, it is time to be true journalists and economists. It is time to live up to your professions code of ethics (if you have one) and give the big picture. Stop pushing for the bull, allow the bear equal time. Expose the rampant fraud and manipulation. Dig deeper into this inflation index that somehow tells people that it doesn't cost anymore to live, but people in increasing number are going bankrupt because what they are being told and what it costs them to live aren't in synch. Check out this GATA story that talks of official US gold reserves being used to prop up the dollar and make inflation look low. Find out if there is any evidence of a plunge protection team -- a sanctioned-at-highest-level-private- and-public-sector-look-the-other-way committee who prevents the markets from realizing their true value by using the future indices to keep market drops lower than they would be and helps rallies move higher. Tell us why 2:00pm many afternoons the DOW and the NASDAQ rally from otherwise down days on a more than statistically likely basis. Tell us how being owned by large corporations doesn't affect your editorial bias as indicated by the guests you choose and the messages they send. Tell us more about who the buyers of gold are and not the sellers?In all MR and MRS TV Financial person, you have got some fixing to do before people respond to this cheerleading and stock market bull bias by simply voting with their push-button or know finger and electrically turn you off. Do your jobs and be real journalists without bias or shameful guest picking. Belgian (08/29/01; 02:13:55MT - usagold.com msg#: 60438) Different Focus The Forum-Talk, last night about the number (and quality) of *Gold* - bugs - advocates - activists - theorists...and others, is exactly what a < contained > Gold-Valuation is all about ! #GOLD# *MUST* remain extremely low profile !For no other simple reason that an adjusted (correct)Goldvaluation was and still is { DEVASTATING } for nothing less than global *confidence*. Just close your eyes and fantazise about a POG into the thousands. Elaborate on all the consequences, possible. The most *(UNIVERSAL)* and unequivoqual Signal, you can imagine, that the past linear thinking has stopped ! It shouldn't surprise us at all that everything is done to avoid such a Gold-Confrontation.I've come to the point, where, I'm wishing that the present Gold-Management, should continue for some time ! Yes, do keep falsifying everything, gentlemen...and give me (us) some more time to generate fiat in order to accumulate more of the managed yellow scapegoat. Thank you.POG's price and time has come to such a state of hibernation that any valuation move will be *shocking*, without any doubt. All minds have fully adjusted to this extreme low Gold profile and it has been written off completely. This never happened before (short lifespan of past 30 yrs) ! That's why it is sooooooo different, today !All emotional drive has been taken out of Gold and what remains is academic considerations and declining adrenaline shots for goldmine adepts. "Gold is out", is no cry anymore, but a state of mind for the absolute majority.So, we have to keep on running with the stubborn few that discretely distribute the profound depts of Gold, to the ones involved in its management. Let them know, we know and inspire them with our Guide's thoughts. Me, convinced this is productive ! Do it. Visit the www parts of BIS/IMF/ECB etc...and send them the full TG's dosis. They will smile.Funny that with the present global contraction, the POO keeps strengthening. Plus 2% in one day for that most basic stuff, named crude oil ! Aloha !But, surely it doesn't matter, because we are living in a full service-oriented world and oil is insignificant. Shhhhwwwaaaww ! Those sweet nice economists. BB, saw you smiling, man.Yes, Auspector...the "Washington" thing into that W.A.Part of the management magic tricks. What is most important?To know "how" they manage it or being convinced "that" they manage it ? Give us more time to accumulate, please.There is no Forum/Petition/GATA - fear (angst). Only apathy and des-interest, due to lack of POG(ian) emotions, and academic boring insigths. The scale of global falsifications (illusions) has taken away the shining glitter of physical Gold. THE BIGGEST MISTAKE EVER !How much fiat-volume is involved in daily interest rate and currency, tsunamis ? If all the GEs should suddenly realize that they are navigating into the wrong direction with their confetti-tankers....that's why GOLD is the biggest and most devastating mine to float around ! And do we really want total destruction ? Watch the USTB-30 yrs.It is the distance between the gambling confetti tanker and the floating mega gold mine. Oil is the deepsea current. Zenidea (08/29/01; 02:13:26MT - usagold.com msg#: 60437) Just a snippet & http://m1.mny.co.za/MGGold.nsf/Current/4225685F0043D1B285256AB6007644F4?OpenDocument&ByLine=Tim+Wood Just a wondering , FOA. do these initials stand for, "For Or Against".:) Old Yeller (8/29/01; 01:43:01MT - usagold.com msg#: 60436) Black Blade ;#60427 Excellent fact filled post of the gravity of the challenges facing the US.It is truly a shame it has evolved this way;the remedy to all of these imbalances,especially those created post LTCM would have been far easier to address back in mid '98.That's what I've always felt,anyway.Thanks for all the info you provide here,I truly appreciate your efforts,as so many others do,too .As FOA says,"we watch this together,yes?" Netking (8/29/01; 01:31:43MT - usagold.com msg#: 60435) Silver - PAAS from 2Q Pan American Silver on silver(taken from second quarter results report)Snippit:Silver prices in the quarter continued the disappointing downward trend set in late 2000, reaching a low of $4.30 in late June. July prices trended lower again, to a low of $4.19 on July 16.This is a 26-year low in real terms and, we believe, is simply unsustainable in the face of the massive silver deficit which has consumed over one billion ounces of silver inventories since 1990. Despite economic weakness in major markets, silver use in industrial and photographic markets has increased to date in 2001, according to a recent independent report by CPM Group, though silver use in jewelry and silverware registered a modest decline. We believe mine production of silver will decline in 2001 and for the next few years due to the closure of many large silver-producing mines and the opening of few new ones. The silver market at present, like many other markets, is technically driven rather than fundamentally driven but it is inevitable that the fundamentals will be asserted at some time and this should be accompanied by a strong upward correction in silver prices. . . ." Netking (08/29/01; 00:55:57MT - usagold.com msg#: 60434) Sliding Silver - "blame it on short-selling" - CPM Group http://www.spokesmanreview.com/news-story.asp?date=082801&ID=s1014474 Interesting comment on silver from the spokesman review, worth a read:SILVER PRICES usually perk up when the stock market falters. That's when investors have traditionally turned to precious metals as a storehouse of value.But silver dropped to $4.11 per ounce this month -- the lowest price since 1993. The downturn came despite a slate of bad economic news and grim forecasts.In the Silver Valley, residents don't need price charts to understand how low silver has dropped. They only have to count mine closures: The Sunshine Mine shut down in February. The Lucky Friday will begin laying off workers next month, leaving just a small crew by the end the year. Only the Galena Mine continues to operate at full production.Other companies are also scaling back. Low prices prompted Barrick Gold Corp., one of the world's largest mining companies, to delay opening a huge gold and silver mine on the Chile-Argentina border.A number of factors play into low silver prices, according to the CPM Group, a New York research firm that tracks precious metals. The firm attributes silver's weakness to short-selling by traders, investor disenchantment, and the strength of the U.S. dollar.Speculative trading practices, such as short-selling, tend to have more of an influence on prices during the summer months, said Vanessa Motto, associate director for the CPM Group. Vacations cut into the pool of investors buying and selling silver futures, which gives those trades more clout, she said.Short selling allows investors to take advantage of anticipated price declines. Essentially, they sell commodities they don't own, with the expectation they will be able to buy them later at a lower price, and profit from the difference.Compounding the situation, short-selling traders have floated rumors for more than a year that the Chinese government is selling off its silver stocks, Motto said."The rumor has shown up in a lot of different places,'' she said. "But that's just not what's happening.''Chinese companies have begun importing silver concentrates to refine, then exporting them to the world market, Motto said. The move is the result of freer market conditions in China. But some traders have mistaken greater quantities of silver coming out of the country for a sell-off by the Chinese central bank, Motto said.The strength of the U.S. dollar also impacts how people view silver as an investment, she said. Though the economy is down, the dollar has remained very strong."If you have an account that pays interest in U.S. dollars, that's a more attractive investment than gold or silver right now,'' Motto said.That's led to individual investors selling off their silver inventories, which also has influenced prices."A number of investors bought silver in anticipation of higher prices many years ago,'' Motto said. "They've become extremely disenchanted with where the price has been.'' Gandalf the White (08/29/01; 00:36:25MT - usagold.com msg#: 60433) Most of Asia in RED INK ! Japan Nikkei 225 Wed. CLOSE 10,979.76 -209.64 -1.87% Low for the day was 10,973.27Hurry up Hang SengHong Kong Hang Seng -- so far at midsession -- 12:35AM 11203.07 -97.46 -0.86% <;-) Black Blade (08/29/01; 00:26:21MT - usagold.com msg#: 60432) Japan's jobless at record http://news.bbc.co.uk/hi/english/business/newsid_1512000/1512798.stm Snippit:Prime minister Koizumi's reform plans are under pressure Unemployment in Japan hit a record 5% in July, producing fresh calls for a supplementary budget to kick start the economy and sending shares back down to a 17-year low. The number of jobless grew by 230,000 year-on-year in July to 3.3 million, according to government figures.Black Blade: Nonessential Japanese "Bones" cast upon the "Bone Pile." Recession gone Global - "Grim" - Better "Go for the Gold" Chris Powell (08/29/01; 00:21:18MT - usagold.com msg#: 60431) South African Reserve Bank admits gold swaps .... http://groups.yahoo.com/group/gata/message/873 ... and says it has no more gold on deposit.http://groups.yahoo.com/group/gata/message/873To subscribe to GATA's dispatches by email and get them immediately so you don't have to go look for them, send an email to:gata-subscribe@yahoogroups.com Chris Powell (08/29/01; 00:20:09MT - usagold.com msg#: 60430) Mining Web's Wood joins Tocqueville's Hathaway http://groups.yahoo.com/group/gata/message/872 Tim Wood of www.theminingweb.com joins Tocqueville Gold Fund's Hathaway in beliefthat U.S. government is probably rigging thegold price.http://groups.yahoo.com/group/gata/message/872To subscribe to GATA's dispatches by email and get them immediately so you don't have to go look for them, send an email to:gata-subscribe@yahoogroups.com Black Blade (08/29/01; 00:19:07MT - usagold.com msg#: 60429) Nikkei falls below 11,000, 1st time in 17 years http://biz.yahoo.com/rf/010829/tav024232.html Snippit:TOKYO, Aug 29 (Reuters) - Tokyo's key Nikkei stock average fell below 11,000 for the first time in 17 years on Wednesday after a Wall Street slide bruised investor sentiment, already shaky amid fading corporate profits and a weakening economy. Major banks including Mizuho Holdings Inc joined the downtrend after disappointing comments on banks' bad loans by Financial Services Minister Hakuo Yanagisawa prompted investors to grab profits in bank shares after their recent rebound. The benchmark Nikkei was down 196.96 points or 1.76 percent at 10,992.44 at 0518 GMT, falling below 11,000 for the first time since October 1984, while the capital-weighted TOPIX index lost 22.80 points or 1.98 percent to 1,127.45.Black Blade: "Grim" Black Blade (08/29/01; 00:13:36MT - usagold.com msg#: 60428) Asian Sinking Fast http://quote.yahoo.com/m2?u RE: Gandy, Yes indeed, a new 17+ year low on the Nikkei. It was nip and tuck, but the Nikkei beat the Hang Seng to sub 11,000. Much further to fall from here. The Japanese Kamikaze economy is in horrible shape and even with zero interest rates. In a word - "Grim" Black Blade (08/29/01; 00:08:29MT - usagold.com msg#: 60427) A Brave New World - The New Recession STOCK MARKET CRASH AND INSANE STOCK VALUATIONSWe are about to embark on a journey that is new to most living beings and not seen our grandparents generation. We are about to see a Recession that could rival the Great Depression. We just need to look at some recent events. We have seen the great "Tech Wreck." In 2000-2001 NASDAQ stocks fell over 60% and $5 TRILLION DOLLARS VANISHED - Gone to "Money Heaven!" That is almost as much as the National Debt! Even after this drubbing of a 60% loss, the average NASDAQ stock was trading at 131 times earnings. That is an obscene valuation and nearly 6 times the 23 times earnings of 5 years ago. The average historical PE ratio is about 14 times earnings. It gets worse! As companies report more dismal forecasts and lowered earnings these valuations become ever more obscene. That means the average NASDAQ stock must fall another 80%+ from these levels just to revert to the historical norm. It appears that the NASDAQ index should be at about 800!The stock market is toast. Even the DOW would have to fall over 30% to revert to historical norms. How does a DOW index of less than 7000 sound? If history is a guide we could be face to face with the most severe Recession in history. Alan Greenspan and the Federal Reserve Governors have cut short-term interest rates 7 times in a desperate bid to stop the carnage. These attempts are doomed to fail. The markets continue to crash regardless. Even the so-called "Smart Money" such as George Soros has reportedly bailed out of stocks. Sure, there will be several "Suckers Rallies" while the Talking Heads and Pied Pipers claim that "the worst is over," "All is well," and "We have found a bottom." It is a trap! The fundamentals only support a stock market crash. Perhaps the most egregious acts come via the Carnival Barkers (analysts and media hypesters) who tout bogus data such as pro forma accounting (lies and omitted critical information), excluding costs of stock options, counting pension funds as corporate earnings, etc.Think on this for a minute - more than 80% of Americans had their wealth tied up in the stock market when the crash began. And more than half had their life savings in Tech stocks- gone to "Money Heaven" (OUCH!). Much of this investment was tied up in retirement investments such as IRA's and 401K's. Hopefully for many of these people they will be able to survive on Social Security (if it survives) and develop a taste for cat food. Many more are likely to experience a distressful change in life-style (poverty). The stock market is just beginning to correct to historical norms and that means stock market crash.CONSUMER CONFIDENCERecently we saw Consumer Confidence numbers fall sharply. The supposed "Wealth Effect" from higher stock earnings has vanished - gone to "Money Heaven." Consumers are less likely to keep spending on consumer goods. The result is lower corporate earnings and a further crash in stock equities and even higher stock valuations. Stock market crashes are always followed by Recession. The result is a panic selling frenzy of stocks, bonds, real estate, etc. Note: Pawnshops are doing a very brisk business these days. What can we do? One thing that we can do is get out of debt a soon as possible. Store food, water, dry goods, have some survival cash on hand, and of course Gold and Silver for portfolio insurance and to tide us over until this mess is sorted out. This will get very bloody before all is said and done - Hang on for the ride! GROWING CORPORATE DEBTCorporations are going broke. Data from the Federal Reserve indicates that US businesses are over $6.5 TRILLION in debt. That debt grew 3 times faster than the Gross Domestic Product! - Now that I call a RECESSION! That is greater than the GDP - greater than the entire production of all goods and services in the US economy! The government can massage the statistical data all that they want to deceive the people, but they can't change the facts. Watch for a record number of corporate Chapter 11 filings this year. Major banks hold loans on this massive corporate debt. What does that mean? A banking crisis of the likes not seen since the Great Depression. Bank Holidays will probably become common events. All the "cash" in those bank accounts held by private citizens? Gone - gone to "Money Heaven" - (forget about the FDIC Insurance). Certainly another reason to hold Gold and Silver as insurance. Banks are bleeding red ink. An example is the Bank of America. This bank had $5.6 billion in nonperforming loans in the first quarter 2001, and that is up almost twice as much from a year earlier. These banks are likely to suffer much greater losses as the economy tanks. With all that is occurring in the economy, is it any wonder that rightly or wrongly, George W. Bush will go down in history as our generation's Herbert Hoover? ENERGY CRISISEvery postwar Recession has been preceded by an energy crisis. That has happened once again. Recently oil prices and natural gas prices tripled, and electricity rates more than doubled. They are still historically high. The potential for severe energy shortages remains very high. Bull markets and economic recoveries always depend on an abundance of "Cheap Energy." That is not likely anytime soon. Demand for electricity is growing while new generating facilities are years away. In order to "Kick Start" the economy a comprehensive energy plan is needed and a concerted effort to produce abundant hydrocarbons is needed. The decaying energy grid must be upgraded and many more power plants, transmission lines, and pipelines are needed. The possibility of more OPEC cuts and a Middle East conflict also complicate the picture. Gasoline prices are rising, and increased unrest in the Middle East could reduce oil imports and that would send oil prices skyrocketing. If these events coincide they could send consumer confidence into a tailspin. UNEMPLOYMENTAnother ominous sign is the growing "Bone Pile." Many thousands of American Workers now find themselves classified as "non-essential" and are being cast upon the "Bone Pile" discarded as nothing more than household trash. Many will likely raid their declining retirement funds just to survive and then get clobbered with tax consequences and penalties - OUCH! Talk about adding insult to injury. Officially there are now well over 3.18 million people cast upon the "Bone Pile." Many more are unofficially on the "Bone Pile" as they were self employed, consultants, or disqualified for unemployment benefits. It is estimated by some accounts that the "Bone Pile" could include as much as 9% to 11% of the US workforce. So far this year the US officially lost over 800,000 jobs. The true number is likely much higher. The unemployment picture appears to be eroding consumer confidence as well and there is no light at the end of the tunnel. CONCLUSIONIf you invest, invest very selectively and get to know those investments very well, after all even in stormy seas there are opportunities. The stock market is poised for a very severe reversion to the historical norm. We are in a Recession and will very likely see a Recession so severe that it could shake the very foundations of society. We could experience a Brave New World like that of our grandparents during the Great Depression. Prepare for the worst and hope for the best. Get out of debt if at all possible - if somehow all works out at least you will sleep better. Get basic goods including food and necessities just as if you were preparing for a natural disaster or prolonged unemployment. Protect your wealth by accumulating hard assets like Gold and Silver for portfolio insurance. Then sit back and watch the approaching storm. Life could get - "Interesting."If I am wrong, at least we will be secure for whatever may come. However, the fundamentals are at best - "Grim" ViewYesterday's Discussion.
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