Welcome to the USAGOLD Gold Discussion Archives. Looking to buy gold coins and bullion? The archives of this gold discussion forum are a treasure trove of information to educate investors about protecting their wealth through portfolio diversification with private gold ownership. The discussion forum also covers the wider issues of the past, present, and future role of gold in international monetary policy and the dynamics of the modern gold markets. To join the debate request a discussion password here.
The opinions posted by all guests at this forum are expressly their own and do not necessarily represent the views of the management or staff of USAGOLD - Centennial Precious Metals. The hosting of this forum shall therefore not be construed as equivalent to endorsement by USAGOLD - Centennial Precious Metals of any of the opinions posted here.
ARCHIVED DISCUSSION FROM 9/11/2000 All times are U.S. Mountain Time (Yesterday's Discussion.) Simply Me (09/11/00; 23:59:40MT - usagold.com msg#: 36491) @The Stranger...It's even worse than that! You said in post #36480: "There are now only about 2.5 million barrels per day in excess worldwide oil production capacity. Almost all of that is in the hands of the Saudis."Hi Stranger, If what Black Blade commented on a few days ago is true (and I believe it is) the Saudi Arabia produces a heavier crude, unsuited to the gasoline refinery process. It's primary market is Asian factories and power plants.POOF...all the oil production increases disappear into the hot air used to produce them!Interesting times are a comin'. Plenty of folks will be glad for that woodburing stove they installed for Y2k preparation.Thanks for all your good work here!simply me Black Blade (09/11/00; 23:45:55MT - usagold.com msg#: 36490) Rest of OPEC Production and Refinery problem article Source: BridgeNews The perception, one that has been advancing among brokers for some time, is that the oil futures markets are now focusing on the demand for products and the inability of refiners to meet demand. This is a shift from a focus on crude supply and OPEC production constraint. "It doesn't make any difference how much crude production is boosted, said a broker. "There are problems that are beyond OPEC's control." Several brokers voiced the opinion that a build in distillate supplies reflected in Tuesday's American Petroleum Institute data will be more important than a build in crude inventories. Crude settling above the $35 was after reaching a new 10-year, near-month contract high of $35.85 per barrel. The 5-cent rise in the heating oil contract was demonstrative of its position as the dynamo behind the current strong oil futures complex, brokers said. Refinery usage in the U.S. is near 100% and demand from the strong worldwide economy continues to outpace refiners ability to produce, in the view of brokers. "Every week we fail to build heating oil inventories is another week for the market to worry that we aren't going to have enough supplies when it gets cold," said a broker. "This is definitely a demand induced market," said another broker. He agreed with the view that even if substantial supplies of crude oil arrived at the New York Harbor tomorrow, the market might still be driven higher on the surging demand for refined products that refiners are seemingly unable to meet. The Saudi's, estimated to have 2-2.5 million barrels of spare production capacity, are the only OPEC producer with significant untapped capacity left to add to the market, according to most industry observers. OUTLOOK Tuesday's focus will be on clarifications from OPEC, especially Saudi Arabia, on whether the OPEC production hike will really mean new barrels make it into the market. In addition, Tuesday afternoon's API inventory data release will be anticipated. That sets up the possibility of another choppy pre-API Tuesday session, with traders wanting to avoid taking to positions too far in either direction ahead of the data release. IN Peter Asher (09/11/00; 23:40:08MT - usagold.com msg#: 36489) LeSin Thanks for the response.Re >>>. Perhaps the weakness of the Euro is a concession to the exporting countries of Europe, but it has brought inflation to places like Ireland. Not a particularly desirable trait in a currency. Remember, strong currencies make for great powers. History has demonstrated this time andagain. First, in the British Pound, and now the US Dollar. <<<<First of all "great powers" don't necessarily have a well fed clothed and sheltered population. For example the USSR folks spending the 2nd half of the century standing on line for bread and milk while they "Ruled" half the world. Maybe in this newer paradigm of interdependent global trade a great power is one who can sell all it produces and buy what it needs from outside. The Eu economy does not have the debt trap hanging over it's head that the USA does. Over the long run, the way the EU is playing it may make them the greater power.Next, From ORO's post today Is the following: >>>>>The EU, though a net creditor to the US, it has enjoyed two decades of growing volumesof imports without a comparable rise in export volumes. That despite maneuvering to maintainpositive dollar trade balances.<<<<< The leaders of the Euro countries must balance the factors of keeping their workers employed and producing, having the credits to purchase the resources and products needed from outside the EU, and, food and shelter for their freeloaders. If a low Euro is what it takes to keep their people affluent as regards domestic purchases, than that's their best option. It's "The Money Changers" that are left whining on the Temple steps and complaining about Schroeder's statement.That fellow running the show in Malaysia is a Hero for telling the IMF to "Stuff it." He's got a peg on the currency and they said "let it float and we'll "Fund" you. That's as in, loan, interest and maybe foreclosure, they weren't offering a gift. The surprise should not be that the Ringgit is pegged, the surprise should be that all the other guys are letting profiteers play with their money and selling their souls to the IMF to finance that game.The one major economic calamity that I seldom see mentioned on this Forum is when the World let private entities trade currencies for profit. Every purchasing credit gained this way comes out of some producers pocket.Oh yes, I'm not up on the Irish inflation problem and am curious as to why, or if, it is of some concern to the EU.I'll go check out that link now, thanks. Black Blade (09/11/00; 23:27:24MT - usagold.com msg#: 36488) RE: Goldfly I have a friend who uses a bit much oil in his hair, do you think that....., Nah! It was just a thought ;-) I had heard of this guy and his mode of transportation. A novel approach, yet not very practical for widespread use. A good way to dispose of used cooking oil though. Biomass fuels are just one of the alternatives looked at by some researchers. Also, today the stock prices of Ballard Power Sys. (BLDP), Fuel Cell Energy (FCEL), Plug Power (PLUG), and Capstone Turbine (CRST)are up sharply today. These Fuel Cell companies could become the next High Tech stock craze with their own absurd valuations. At least they aren't Dot.Coms surviving on a "Wing and a Prayer." Black Blade (09/11/00; 23:14:53MT - usagold.com msg#: 36487) Pump Away, but Then What? Source: BridgeNews NYMEX Oil Review: Crude reaches 10-yr high despite OPEC hike By Robert Gibbons, BridgeNews New York--Sept. 11--NYMEX Oct crude oil futures ended sharply higher Monday, reaching a new 10-year near-month high despite OPEC's crude oil output hike. The view that OPEC's hike adds few new barrels and news Mexico would not be able to immediately up its production combined to spark the rally. Oct crude settled up at $1.51, or 4.22%, at $35.14 per barrel. Oct heating oil settled up 549 points at $1.0498 per gallon. Oct gasoline settled up 230 points at 97.35. The perception, one that has been advancing among brokers for some time, is that the oil futures markets are now focusing on the demand for products and the inability of refiners to meet demand. This is a shift from a focus on crude supply and OPEC production constraint. "It doesn't make any difference how much crude production is boosted, said a broker. "There are problems that are beyond OPEC's control." Several brokers voiced the opinion that a build in distillate supplies reflected in Tuesday's American Petroleum Institute data will be more important than a build in crude inventories. Black Blade: BINGO! This nails it! As I have said all along……It doesn't matter how much production is increased, it's a matter of processing it! ORO (09/11/00; 23:04:09MT - usagold.com msg#: 36486) 714 - Tax and price 714I enjoy your discussions with FOA and appreciate both your thinking and the responses it induces FOA to post.thanksTax is part of a final cost to the consumer, and thus constitutes a mechanism for providing some an advantage in cost as well as providing some revenue to the government. VAT and sales taxes are but one mechanism by which different prices are made available to different consumers. "Official" exchange rates and prices are another mechanism, as are subsidies and legal demand or supply constraints applied to some areas and not to others, and regulatory impositions of costs. Aside from these government dictated creators of price differentials, there are natural causes related to costs of marketing, transportation, high real-estate costs, etc..The price differential that we can point to in gold is that supplying a few large orders can only be done with new mine production and that requires fresh investment, for which the supplier will have to pay. A buyer that asks for 100% of the annual supply in the market will be known, and asked to pay for the thousands of people that will be scraping the low grade marginal ores that must be used for that supply, and for the exploration, equipment/capital costs, etc.. In the case of gold there is a large existing stock that can be tapped at the right price - the price expected to cover the cost of mining the gold that will replace the sold quantity.The gold seller in quantity will know how long it would take the mines to come up with the gold and at what costs. He will also know that upon putting in a bid to purchase that gold on the public markets, the price would skyrocket and the price action would be exacerbated by the participation of momentum players and broad public buying. If the gold is ever supplied, it will be at the time and at the price that clears not only the large buyer's demand, but also the additional demand that results from the buyer's bid. Goldfly (09/11/00; 23:00:33MT - usagold.com msg#: 36485) Peter, Black Blade, All http://www.greasecar.com/Home.html I'm up way past bedtime, but I'm exploring some "Alternative Energy Sources". I think you'll like this.......Eat your french fries and drive them too!Prediction: Crude down $10 tomorrow. Peter Asher (09/11/00; 22:48:32MT - usagold.com msg#: 36484) (No Subject) TheStranger Re >>>>The "theory" is that higher prices act like a tax onthe consumer and threaten the economy.<<<<That's one of those half truths. If "consumers" are spending saved money, dollar fixed income or have earnings/profits that are out of the "Wage Price Spiral" loop: then that statement is valid. However, with most of today's consumption being on *Credit* Then by golly everyone who can jack up their prices or force a wage increase will pay back their loans with cheaper dollars, wind up with more spending money, and we'll have a bigger BOOM! This couldn't be, now, could it? Black Blade (09/11/00; 22:46:55MT - usagold.com msg#: 36483) Marius and Gresham, Ah, make that...... OK, maybe I should amend that to a six-pack of "Moose Drool" and Denise Richards with a 24K "Aussie Dragon" hanging around her neck ;-) Black Blade (09/11/00; 22:42:12MT - usagold.com msg#: 36482) Marius, Gresham, and ORO Marius and Gresham: OK, I'll settle for some Negra Modelo and a splash of ORO. However, I'm still a Jeanie (I dream of..) and a Mary Ann (Gilligan's Island) kind of guy ;-)ORO: Welcome back, sorry about the reason for your absence. Your article was a good read, and still digesting it. Mr Gresham (09/11/00; 22:25:35MT - usagold.com msg#: 36481) Marius My Tori? -- I wish... But I'll listen for Diana. I keep putting that timing chain back on to read Oro for comprehension. Sometime I'll think of an intelligent-sounding question to come back with to show I'm really reading it all... Till then, this jabber... TheStranger (09/11/00; 22:23:44MT - usagold.com msg#: 36480) The Other Nine There are now only about 2.5 million barrels per day in excess worldwide oil production capacity. Almost all of that is in the hands of the Saudis. A little belongs to the UAE. The other 9 OPEC producers are presently running flat out. None of those nine can raise production overnight. Therefore, none of them can benefit from any near-term agreements to pump more oil. Such agreements can only cost them valuable revenues by depressing prices.The rulers of these countries are not idiots. They remember well the days of $10 oil when they were forced to sell their most valuable resource for such a small fraction of what Evian gets for water. They are also fully aware of the exorbitant taxes which are levied by opportunistic western governments upon their energy hungry citizens.I bring this up because we are now being treated to the site of numerous OPEC oil ministers assuring the world of a willingness to pump whatever amount is necessary to bring prices back down. I think this is grandstanding. I don't believe existing production capacity is sufficient to support such claims. Such talk is far more likely, in my view, intended to play to the angry crowds of europeans who have been demonstrating in the streets. By fueling the ire of those crowds against their own governments, the OPEC membership hopes to achieve lower prices at the expense of the energy taxers rather than the energy exporters. And judging from today's acquiescent remarks by the French, there are signs already that this ploy can work.*****Amazingly, CNBC seems to have no trouble finding one "expert" after another willing to declare the current price environment just a temporary blip. Furthermore, almost no one on CNBC's air seems to expect any overall inflation to accrue from any of this. At such times, it is wise to ask oneself how many of these sages saw any of this coming in the first place. There are none that I can recall.Yet this whole experience owes to the most basic of economic principles. When governments allow excessive "money" creation, overall demand for goods and services will inevitably exceed overall supply. In such an environment, some things, and eventually MOST things, must go up in price.*****On another subject, nothing captures my funnybone quite like all this talk that if prices don't start coming down soon, the Fed may have to ease. The "theory" is that higher prices act like a tax on the consumer and threaten the economy. Good Lord. Who comes up with this stuff? Marius (09/11/00; 21:55:30MT - usagold.com msg#: 36479) Mr. Gresham's "Damn!" Mr. Gresham,One man's porter is another man's single malt. One man's Tori Amos is another man's Diana Krall. Whatever one's taste in adult beverages & music, combine them with a late night dose of Oro on derivatives, and you will slip your brain's timing chain! Born to be wild!M andrew the kiwi (09/11/00; 21:14:35MT - usagold.com msg#: 36478) (No Subject) test lamprey_65 (09/11/00; 21:10:02MT - usagold.com msg#: 36477) Gold at a minimum of $1000 per ounce in this bull cycle... OK, so it's not $30K per ounce -- but I'm only basing this on technical indicators which EVERYONE can see. Let me explain.There are currently three major up-trendlines for the Dow Jones Industrial Average:1. What I call the "SuperBull" move since early 1995. This trendline was broken on the downside earlier this year and we've never been able to re-establish above.2. The "secular bull" move from late '82, early '83. This trendline currently provides the major support below 10,000 - currently this support is around 7600. We could test this support and still be in a bull market since the early 80's.3. Now the bad news folks. In a major recession in which we pay for our profligate money creation, 7600 will not hold, and it's a long way down from there.THE most important trendline for the DOW began way back in 1934 as the index began it's slow recovery from the '29-'30 crash. This line has never been broken, but has been tested several times...in '42-'43, very close in '75 and '80, and the last time in 1982.A retest of this trendline is near....a DOW 2000.Now, thanks again to MK's Dow/Gold ratio chart...we can expect a ratio of a maximum of 2 when this chart forms the next trough (which it has already begun to move toward) -- which gives us $1000 dollars per ounce gold.You say 2000 Dow won't happen? Maybe you're right. Maybe it bottoms at 5000 - that means a minimum $2500 an ounce. Make my day!Lamprey andrew the kiwi (09/11/00; 21:08:57MT - usagold.com msg#: 36476) via le metropole today September 11, 2000 - Spot Gold $272 unchanged - Spot Silver $4.85 down four centsTECHNICALSThe more oil goes up, the more the gold cabal sits on gold. The open interest on Friday went up 7,054 contracts to 135,367 contracts and the volume was over 30,000 contracts - on a small down day in the gold price. That would suggest that the manipulation crowd has had to step up their selling to keep the price of gold from rising, as commodity prices continue their ascent higher.Can this orchestration of a low gold price be any more obvious?Today, the CRB roared ahead to new multi-year highs once again and finished at 230.91, up 1.13, while crude oil rose $1.51 per barrel to $35.14. Heating Oil was one better as it rose 5.49 cents a gallon to 104.98 cents. What will the price of heating oil soar to when cold weather appears.Nickel, zinc, copper, palladium and platinum have made nice to monster moves to the upside. Gold? It keeps going nowhere - to down.The technicals really are meaningless, but out of habit, here are a few notes. The Commitment of Traders Report released on Friday showed a reduction in the spec short position of about 8400 lots, but the funds are still short about 19,000 contracts which is a bullish plus for gold. In addition, the bullish consensus dropped to a new low at 16%. That is also bullish as that is the second lowest bullish consensus I have ever seen.Bigger picture: gold appears to be in the process of completing a massive 2-year head and shoulders bottoming formation. This is as good a set up for a sharp move higher in the price of gold as one can have.Silver just diddles, while its base is even more massive than that of gold. All the manipulation crowd did was buy silver and pop it up 25 cents to squeeze out 25,000 spec shorts. That accomplished, the "cabal" is back to pounding silver again. No different than what they have been doing in gold for years now.FUNDAMENTALSThe Café's oil information from your fellow members continues to be a "10." Very few oil analysts out there have nailed this move up as we have - and forecasted the reasons for it to do so. Here is the latest oil bulletin from one of those sources:"September 11 , 2000. Based on a detailed evaluation comparing crude oil tanker capacity to current world demand, it appears that the proposed OPEC increase of 800,000 barrels per day production will have no impact on rising prices other than the temporary effect caused by the reflex reaction of uninformed speculators in the futures market. Data shows a shortage of tanker capacity to move the amount of crude oil already available on the market. In short, no one, including OPEC, can physically move more crude oil into the international export market right now."A number of factors are coming together to cause an impending price spike that can only be tempered by a severe reduction in consumer demand, primarily in the US." This source goes on to say:"Economic recession due to high crude oil prices could be as near as January. New annual budgets for non-petroleum companies will be reconfigured to cover high petroleum costs. New budgets will spawn higher product prices, and result in less expansion and less spending on nonessential items. First items to be cut from budgets will include computer equipment, Internet sites, furniture and construction projects."Here is another tidbit for you from a different source:"Just to let you know that I have been in contact with Dr. X and we both believe that sometime soon (September/October) Saddam will cut supplies."If he does, oil could go higher than the predicted $50 per barrel, maybe to $60. Imagine the political havoc....." End.The reason for the special oil focus is obvious. It is heating up inflation all over the world. That inflation is going to put great pressure on the gold cabal and eventually could be the factor that does them in. It is only a matter of time before the gold price follows that of oil, platinum and palladium.POTPOURRI AND THE GOLD SHARESHomestake Mining announced today that it is going to wind down its operations and close its high-cost, flagship Homestake gold mine in Lead, South Dakota, and expects to take a related one-time charge of $43 million in the third quarter.Another sad day for the gold industry as this mine is 124 years old. The gold pool has done it again by deliberately causing another gold casualty. In 1998, Homestake restructured their mine plan and developed new efficiencies in the hope that the mine could survive long into the future. However, according to CEO Jack Thompson, "the fall in the gold price prevented the plan from working."Jack Thompson's fine efforts to cut costs all went down the drain. The gold producers would be much better off spending their time, money and efforts in getting the price of gold up than worrying so much about cost cutting that is not doing them all that much good. All they have to do is expose the manipulation of the gold price and that manipulation will end; the price of gold will then fly. A good start would be to focus on Reg Howe's latest essay. He has shown that the gold derivative build up is more market explosive than the gold industry seems, or wants, to understand. Jessica Cross says, in essence that if Reg Howe were correct, the situation would be "alarming." Well, Reg is right and the situation IS ALARMING!That is why the GATA delegation trekked to Washington to present our "Gold Derivative Banking Crisis" document to the Speaker of the House, Denny Hastert.Go for it, gold producers.Gold production is declining everywhere. Brazil's Compania Vale do Rio Doce announced today that they will not meet their gold production targets for this year. This is a stunner for you. In the 1980's Brazil produced more than 3,527,000 oz/year, while in 2002, total gold production is only expected to be half that.The Russians, known for their trading prowess, continue to build their gold reserves. Their central bank gold reserves grew by $95 million in August.The Euro is a real winner. Getting closer and closer to the time when they are going to have to use their gold card to bolster this sagging currency. The Euro is not a sovereign currency. By upping its gold backing percentage, it will give the currency more credibility. At the same time, they should start calling in their gold loans. "Katy. bar the door" when that happens. Gold takes off and the Euro reverses.It is very hard to comprehend why so few people are willing to accept the fact the gold is suffering from price fixing. As GATA's attorneys at Berger & Montague told us many months ago, "it goes on all the time."The Securities and Exchange Commission and the Justice Department charged four U.S. options exchanges today with anti-competitive behavior -- in particular, "with refraining from listing options already listed on another exchange. Collectively, they agreed to pay $77 million for new surveillance and enforcement.Who are the culprits doing the gold price fixing according to GATA? - certain bullion banks we say. We also strongly suggest that the Exchange Stabilization Fund (which takes its marching orders only from the President of the US and the Treasury Secretary) also has a hand in that price fixing. Therefore, it is with great delight that I present you this AP release:Accusations From Banking Committee By MARCY GORDON, AP Business Writer WASHINGTON (AP) - The House Banking Committee chairman is accusing the Clinton administration of ''secretly'' giving some banks approval to buy stocks of commercial companies. Rep. Jim Leach, R-Iowa, says Treasury Department officials are trying to give banks powers they did not get under major legislation enacted last November allowing them to expand into other financial businesses. Leach made his objections public Friday in a letter to Comptroller of the Currency John D. Hawke, Jr., whose Treasury division oversees nationally chartered banks. End.So many get hung up on semantics. When GATA ever mentions the word conspiracy, eyes start to roll in the heads of the uninformed. Of course, if politicians or the mainstream crowd uses that word, that is a different story. Note this Bloomberg release:Ford, Bridgestone Withheld Information, Tauzin Says"Washington: The head of a congressional committee investigating the Bridgestone Corp. tire recall said a Ford Motor Co. memo suggests the companies conspired to withhold information from U.S. safety regulators. Representative Billy Tauzin, citing a March 1999 document, said Bridgestone feared that Ford's move to replace tires in Saudi Arabia would mean they would have to tell U.S. regulators. Federal officials are now investigating at least 88 U.S. deaths that may be linked to the tires, which were recalled last month. ''It's the first clear evidence of an intentional effort to deceive federal agencies chiefly responsible for safety on the highway,'' Tauzin told Bloomberg Television." End.POTPOURRI AND THE GOLD SHARESPlacer Dome has calmed down a bit since Thursday when this story was the talk of the gold brokerages:Placer Dome shares trade heavily on takeover rumoursTORONTO, Sept 7 (Reuters) - An ongoing merger wave in the global mining sector lit a fire under the shares of Canadian miner Placer Dome Inc. (PDG.TO) on Thursday as analysts tagged it as the next takeover target in the shrinking industry."The company has been, for a while, the subject of merger of takeover speculation and the intensity of the speculation comes in waves. It has just perked up in the past two days," said one Toronto-based analyst……"It's a company that makes strategic sense for a couple of potential acquisitors and you could probably say everybody above them in the food chain in terms of market cap would be happy to own the company at the right price." End.A change of pace gold analysis for you:My name is Al Micik and I've enjoyed/appreciated the information you have shared with me for many months now. I thought a couple of my thoughts may be of interest to you, your staff and supporters. My thoughts reflect the technical action of the gold market relative to the derivative situation today. Feel free to use this or disregard it as you wish - it's simply my way of saying thank you for your efforts.This January, 2001, will mark the 21st year of gold's bear market. That's interesting because 21 years is a math number that may lead to the most significant upside move since the golden days of early 1980. Given that bullish sentiment is below 20% for both gold/silver currently, we now find that an 80% bullish level has not occurred since early 1996. Bullish technicals and derivative fundamentals will merge soon, but probably not later than a few months either side of January, 2001. The fundamentals described in your E-Mails now correspond to an explosive potential when we step back and look at this market as though it were XYZ Stock. Imagine a stock with a short interest that would take 5-10 years of average daily volume to cover all shorts...wouldn't that be an interesting long play? Add to the equation that everyone knows it's a loser. Sentiment is below 20% bulls and has not approached 80% in almost 4 years...still interested? Still crazy after all these years?Now, the potential disruption for each short position will, when it occurs, be inescapable. What is interesting about this fundamental and technical mix is that the fundamentals could cause the move and the economics of the message might be "short squeeze." The media could rationally argue that this type of upside move was driven by speculators and was not reflective of the economy's fundamentals...and they would be partially right. A great alibi. But, the move higher will likely happen whether you are bullish or bearish on the "yellow metal." What longs are left given the psychology of this market? They probably are strong now and will look for a solid profit before they sell. The last note would be to allow for one more low or psychological low into October based on my proprietary work. Once this final phase occurs the merging of the derivative situation and the technicals appears complete and a multi-year bull market should commence. Best Wishes, Al Micik The Gold Anti-Trust Action Committee extends a big thanks to German Café member Reinhard Deutsche, who translated a Frankfurter Algemeine Zeitung article from German into English and GATA's letter to FAZ from English into German (see Matisse Table). It was a lot of work and very much needed by us.I thought you might like to know a little more about Reinhard (R.Deutsche@t-online.de) so I am sharing part of a couple of emails he sent me with you. They are very interesting and revealing:"Here is another little story, that might interest you. I have written a book about the war against gold and silver, with the title "Die Geldfalle" which means "The Money Trap". At the following URL: http://www.goldseiten.de you may find more information about the book."My publisher has sent the manuscript to the chief economists of 4 large banks here in Germany for review. Of course they all wrote, that the theories in the book are wrong. However Prof. Norbert Walter, chief economist of Deutsche Bank explicitly asked my publisher, not to publish the book (which he did). I take this as a compliment. Isn't it about the same as if the Pope is putting your book on the index? I am selling the book now direct over the internet by guerrilla marketing and it works. Maybe we should do an English translation of it."And there is another real story about Deutsche Bank, which was discussed in the gold forum at Wallstreet Online.de"There was a man with the pseudonym "xnickel" (I know him). He had an account with 200 kg Silver at Deutsche Bank Zürich. One day he was informed, that Deutsche Bank had sold the silver and sent him the money. As the reason Deutsche Bank Zürich said they are planning to raise the fees for silver deposits by ten and as silver is a bad investment, this would be to expensive for him to hold. He never gave a sell order. He sent the money back and told Deutsche, that he wants the silver, but they said this is impossible, he has to take the money. He went to a lawyer and later Deutsche Bank in Frankfurt settled the dispute by handing him out its silver (at quite a fee plus Mehrwertsteuer). Isn´t that a clever way to separate uninformed people from their silver? It is almost impossible to buy silver in Germany. The spread is more than 30% and banks do not offer silver accounts." End.Then, this one today about his conversation with FAZ about GATA's letter that was faxed to the paper:"I just talked to the Papermaker of today and have also faxed him the English and German version. Papermanager of today is Mr. Beck, with Mr. Stelzner assistant. They both know about GATA."The first two (positive) articles in the FAZ were written by Mr. Arndt Hildbrand (hi). He is a freelance writer, with commodities his main subject."The last article, with WGC and GFMS, came from Mrs. Bettina Schulz (bes) from London. She got an education in banking, before she became a journalist at the FAZ, and guess where? Right, at Deutsche Bank."All the BestReinhardMy favorites for 2000 so far:Best title of an email: by Chris PowellWorld Gold Council gives up on goldBest nickname: by Reg HoweJessica Double-CrossWorst allocation of resources: by AnglogoldOn their giving 9 million $ to the World Gold Council this yearMIDAS 714 (09/11/00; 20:34:13MT - usagold.com msg#: 36475) Oro... ...you said, "We should remember that dual price markets in gold have existed for prolonged periods, and continue to exist in places such as China and India, along with dual price markets in Europe, where the value added tax (VAT) introduces the price differential between export prices and local consumption prices."I own a business here in America and many of my purchases under the umbrella of that business are exempt from sales tax, which is a local VAT, whereas I pay that tax as an individual. Is that really a "dual price market"?The price is the same. The tax is different, yes? 714 (09/11/00; 20:05:04MT - usagold.com msg#: 36474) LeSin, Peter Asher re: Euro http://europa.eu.int/euro/html/calendrier5.html?lang=5 The Euro is young and still in the process of creation. The old currencies, such as the franc and the mark, have yet to be dismantled. This is neither an easy or simple transition for Europe, and countries like Switzerland and Britain remain "in the cold". Peter, I've noted your comments and do not take issue with them. Perhaps the weakness of the Euro is a concession to the exporting countries of Europe, but it has brought inflation to places like Ireland. Not a particularly desireable trait in a currency. Remember, strong currencies make for great powers. History has demonstrated this time and again. First, in the British Pound, and now the US Dollar. Keep an eye on the Euro's timetable. If these events begin to be put off, the Euro is in deep trouble (see link). The Euro's most difficult days lie ahead.***********************************************Remember, it is so important to think for yourselves and to draw your own conclusions. Always seek to verify what others tell you....Salaam. Mr Gresham (09/11/00; 19:42:03MT - usagold.com msg#: 36473) Damn! Damn!I've gotta stop reading Oro, while drinking Black Butte Porter, while listening to a Tori Amos concert CD. I'm having a peak experience while reading about derivatives!Sample: "Note that theoretical circumstances allow delta hedging of a 100 oz original short position in options, by a 30 oz long position (using 1 or 2 year volatilities in the Black-Scholes option pricing model), thus allowing theoretical coverage of the full 100 oz short price exposure with these 30 oz of long gold accounts, bullion, or futures contracts."Damn! That just does it for me! My head feels like a pool table with a master's breakshot caroming around inside it.(I feel like the grateful townspeople at the end of a Lone Ranger episode: "Who WAS that Masked Man?" Who IS this guy?Oro -- to follow where your mind goes in one economic day -- there lies either madness, or great wisdom. Salut, brother.) HI - HAT (09/11/00; 19:25:45MT - usagold.com msg#: 36472) Lemming Leadership Zen in the markets equates to the simple observations, Is the price going up or down?Oil - up, CRB - up, Dollar - up. Here in is what is going to get the Global inflation roiling. Many items benchmark price set too pricing in dollars. Price pressures in World reaching critical mass.The Europeon release today about oil prices and its effecton World growth is very curious and could turn dangerousin the future, if there really is a developing oil shortage.Oil going up is interfering with their pumping taxes on it.And note, at this time, in the fiasco, not any Leadership suggestions for at least thinking of conservation.Oh no, this is at the point where it is bad form to introduce anything into the equation, that will disturbthe Virtual dream. JMB (09/11/00; 19:25:30MT - usagold.com msg#: 36471) Regarding a very interesting rumor. Rep Leach, the House Banking Committee Chairman, has accused the Clinton Administration of "secretly" giving some banks approval to buy stocks of commercial companies.And now the rumor.The GS gang is buying gold shares. They like the leverage. Gentleman, if this is true, the price of gold is going higher in a hurry. JavaMan (09/11/00; 19:00:42MT - usagold.com msg#: 36470) (No Subject) Sorry TC, that was msg # 36398 Cavan Man (09/11/00; 18:33:32MT - usagold.com msg#: 36469) Hello ORO Best to you and yours. JavaMan (09/11/00; 18:19:01MT - usagold.com msg#: 36468) (No Subject) Hi TC, in your msg#: 3639, you said "..., at what point will the U.S. be compelled to play ball and return the old favor in the interest of long-term global stability?"Just some idle speculation but lately I wonder if the US has any intentions to "play ball". By the looks of the demonstrations taking place in Europe this last week over oil prices, it seems that if the POO stays high or goes higher, Europe, with their heavey petro taxes, and perhaps much of the rest of the world would be decimated economically compared to the US. Not unlike the oft repeated tale of the two men in the woods who encounter the bear. Lady Leigh, Sorry to hear about your foot. I broke an ankle years ago in a freak accident and remember all to well what a hassle it is hobbling around with a cast up to my knee. Get well soon. Oh, yeah...that quote you gave us sounded like something Hillary would say, no? Just not in public.Oro, Good to see you back sir...hope all is well on the family scene. You said, "The EU, however, is preparing a debt trap on the dollar through the displacement of the dollar from its market share in denominating new international debt...At the point at which the dollar moves down strongly against the Euro, the Arab oil interests will have their excuse for the elimination of the dollar as exclusive currency of the trade in oil." As per my speculation above with TC, could the US be using (encouraging even) a high POO as a counter play against such a move by Europe and to head off the Arabs? Mr Gresham (09/11/00; 17:57:56MT - usagold.com msg#: 36467) Oro! Oro! Oro! As usual, a quick check of the forum before racing off to pick up kid from school and wife from work reveals a tantalizing bit of after-dinner reading ahead! Welcome home to our generous friend! beesting (09/11/00; 17:38:57MT - usagold.com msg#: 36466) Welcome Back Sir ORO, Great Post # 36456. http://biz.yahoo.com/rf/000911/n11612097.html Comment:I have been watching the FOREX charts today and the picture is clear that the rise in value of the U.S. Dollar is directly related to all the other countries first changing local currencies into U.S. Dollars, and then using the Dollars to buy oil. Therefore as more and more oil is consumed, (fiat)foreign reserves are depleted causing loss of purchasing power in local currencies, and at the same time strengthening the U.S. Dollar.Even the SDR has lost value in relation to the Dollar. See above URL.It would seem the price of Gold is also RISE-ING in every currency that's being affected, except the U.S.Dollar.Those holders of dollars,in the know, are buying Gold....beesting. LeSin (09/11/00; 17:36:21MT - usagold.com msg#: 36465) ORO - Welcome Home Thank you for your clarity supported by facts.There are so many brillent posters on this site, I am reluctant to speak. It is because of the quality of respectful persons in attendance that I fear not in sharing my thoughts and ideas of limited understanding. Thanks to ALL. "S" LeSin (09/11/00; 17:26:59MT - usagold.com msg#: 36464) (No Subject) 714 @ Europe Divided & "Political Will" Thank you for your comments all of what you say is true. The same can be said about the Middle East Countries and factions waring between brothers and sisters. Also civil wars in USA, UK and European Countries. I focus upon the "New" game in currency and gold, "Not as before" as Another has stated. What unites people, nations more than a "common" enemy that has enslaved them? Love? Respect? Fear of economic survival and an excellent opportunity of removal of a hegemony is the fuel of "political will of Europe and Asian partners to back this new Fiat Currency. Because it provides a "clean start" The Kicker or The Carrot payoff, is to allow "Free Gold" unhindered and not manipulated by the paper derrivative market.United Europe is a fact, for how long into the future is any ones guess. Europe will unite long enough or for however long it takes to establish a strong alternate currency. That is simply enought to topple the US$ dominance. Asia will support. "S" Boxman (09/11/00; 17:15:47MT - usagold.com msg#: 36463) Let's try that link again. http://news.ft.com/ft/gx.cgi/ftc?pagename=View&c=Article&cid=FT3MYCJVZCC&live=true&tagid=IXL5PIPSW8C My apologies. Boxman (09/11/00; 17:08:34MT - usagold.com msg#: 36462) More on TownCrier's BIS post # 36445 news.ft.com/ft/gx.cgi/ftc...XL5PIPSW8C Does it appear as if the BIS is positioniting itself for world leadership? wolavka (09/11/00; 17:01:05MT - usagold.com msg#: 36461) Two to tango China and switzerland:watch these countries big time. CoBra(too) (09/11/00; 16:57:00MT - usagold.com msg#: 36460) Austria, the EU and euro ... Just lost long message in cyberspace - will repeat some time - too late for tonight - ORO, good to see you back. EU and euro will have another test on Sept. 28 by Denmark's referendum. Until then begnign neglect for the euro - as has happened to the US$ before the 90's, when it had to defend its role as "only reserve" currency - outright war on any potential contender - and don't take any prisoners! ... and Austria will stay the same gentle country it was before the sanctions. Though the EU may experience some changes in perception ... by other members as well ... a socialist blunder undermining the Union and the euro ... US$-> ;>) good night - cb2 wolavka (09/11/00; 16:49:49MT - usagold.com msg#: 36459) watch tonites trading globex dec 279 now breakout, they can't hold it down much longer.swiss franc to explode to upside, somethings up. ET (09/11/00; 16:33:34MT - usagold.com msg#: 36458) Fuel shortages http://news.bbc.co.uk/hi/english/uk/newsid_919000/919429.stm From the article;Motorists around Britain are facing increasing shortages of petrol as protests against soaring fuel prices gather pace. Six out of the country's nine oil refineries and four distribution depots are now subject to blockades by picketing lorry drivers and farmers. Panic buying by consumers has exacerbated the problem and hundreds of petrol stations, if they have not already run dry, have now resorted to rationing supplies. The UK government, which takes almost 80% of the price of petrol in taxation and duty, has insisted "there is no quick fix", blaming high petrol costs on increased oil prices. ET (09/11/00; 16:26:09MT - usagold.com msg#: 36457) More free trade http://www.arabia.com/article/0,1690,Business|28701,00.html Europe warns OPEC to honour cheaper oil pledge Prices must return to a level that preserves worldwide growth, according to an EU statement. September 10, 2000, 06:49 AM France (Reuters) - Europe on Saturday urged OPEC to honour promises to curb the price of oil and called for swift action to protect world growth ahead of a crucial meeting of oil producing nations. "The current level of oil prices is a major source of concern. Oil prices need to return to a level that preserves worldwide growth," said a joint statement from the European Union's 15 finance ministers (Ecofin). Ministers from the Organisation of Petroleum Exporting Countries meet on Sunday in Vienna and are also under pressure from the United States to reduce oil prices, currently well above $30 a barrel - triple their level of a year ago. "We expect OPEC to keep its promise that if the oil price is higher than $28 a barrel for a long period they will increase production," Dutch Finance Minister Gerrit Zalm told reporters. But the communique also exposed an internal row over French appeasement of truck drivers protesting diesel prices, with British Chancellor Gordon Brown vowing not to make policy "on the blockade" and the Dutch also venting naked frustration. "What we have written in the declaration means that France cannot continue to cut taxes," said Zalm, referring to tax breaks Paris has announced for truckers who have blockaded refineries and bled petrol stations dry. "Not everyone is happy about the decision in France. If you talk all the time about coordination in Europe you should inform the others about such matters." The Ecofin statement said each minister "stated his government's position of no change in its policy on oil taxation -- for economic and environmental reasons". Coalition governments in Germany, Belgium and France include ecologist parties. Germany, Spain and Italy argued tax cuts to offset higher energy costs would simply siphon revenue out of the public purse and into the hands of oil sheikhs. "Anyone who wants to cut taxes on energy as an answer to higher oil prices has already lost," German Finance Minister Hans Eichel told reporters. "You would be opening your national budget to OPEC and the oil industry." ORO (09/11/00; 16:24:23MT - usagold.com msg#: 36456) I'm Back some notes on recent events Had to assist in family illness and had little time to track the board, much less offer comment. I am glad to see FOA posting as himself again. These long partings make the clarity of FOA's message and its unique perspective stand out all the more.Welcome back.----------------------Jessica Cross' "Report" is simply an echo of her MAIN client's interests. Surely the noted gold bear would not reverse a decade of advice for the benefit of parties like the WGC that do not have the means to subscribe to her "honest" opinion on a regular basis. Particularly, she would not endanger the survival and reputation of her clients. The WGC, being a subordinate of some clients, is obviously a target for harm - as Ms. Fakuda, its leader, had contradicted the DOGMA of the Bullion banking industry, and thus threatens the credibility of their message just as Galileo threatened the Church of his time.Her "report" ignores the gold banking business in favor of examining the gold derivatives business. Gold accounts, about which no quantitative public information is available at all, are ignored by GATA and Howe, as well as Ms. Cross. Reg Howe has shown the key flaw in her dealing with derivatives accounting in the gold market; that she assumes INCORRECTLY that the notional values reported by the US and Swiss authorities and the BIS are cumulative in nature; that both original positions and the trades that unwind them are counted in the notional values. They are not. The notional exposures are outstanding amounts – not reflections of accumulated trips in and out of positions. These are the UNBALANCED portions of positions. Those in which the dollar side of a trade is matched by gold on ther. The accounting is specifically structured to minimize double counting, and to highlight mismatches in timing and denomination in addition to mismatches of counterparties. Particularly, the intention is to show the exposure of banks (both long and short) to non-bank entities. During the period up to Aug-Sep 99 the correlation of price movement to outstanding positions reported as notional values indicated that 25% of positions were long. Of late, it seems that the correlation has shifted since Q2 99 to a 50% long exposure for NEW contracts (consistent with shutdown of activities by some bullion trading firms). The old contracts have been extended (see OCC report) and the composition has changed from futures (delivery contracts) to options (price contracts based on delivery of a futures contract) on the European side. URL:http://www.goldensextant.com/commentary14.html#anchor27297I have said some months ago, that the European banks had unloaded their gold delivery obligations in favor of options with definite expiration dates but no clear delivery obligation of the metal, but of a futures contract for the subsequent month. The awareness of European banks of the looming assault on the dollar (through a traditional debt trap) and the role of gold in it must have led them to net the gold exposure both to price and delivery. While price can be hedged by the purchase of options, delivery obligations can only be unwound by having another bank take it on in the manner in which Q2 99 showed the Banker's Trust (owned by Deutsche Bank from that point) bullion business end up in the hands of Morgan Guarantee. Given the lack of breakdown data of non-European positions, particularly of US banks, the bank's delivery vs. price commitments will remain a speculative estimate. However, there is a basic difference in the delivery commitments of the non-EMU banks, judging by Deutche Bank and UBS disclosures. While the EMU banks moved to be committed to deliver dollars and Euro to reflect price changes, the non-EMU banks have taken over the commitments to deliver metal. Most probably, this was a result of an attempt by the key US-Anglo banks to eliminate forced gold buying to cover metal delivery commitments (shorts) by banks in general well before the WA spike in POG and later. This was done in order to prevent a price spike, and perhaps in order to keep financial resources within the banking system, which has become extremely capital intensive due to the transition to same day settlement. Duesenberg (sp?) of the ECB was somewhat distressed at banks clearing the whole of their net assets (capital) daily, speaking of the enhanced stability of longer settlement times and netting (where only the differences in interbank flows are settled, rather than the whole stream). Going back to Cross’ "report", she has attempted to lead the gold hounds to bark at the tree of price exposure, and argued that theoretical price exposure (where delta hedging works and angels dance on the heads of pins) indicates that there is no fox in the tree, while the bank foxes were teetering on the wee limbs of the metal delivery commitment tree. Note that theoretical circumstances allow delta hedging of a 100 oz original short position in options, by a 30 oz long position (using 1 or 2 year volatilities in the Black-Scholes option pricing model), thus allowing theoretical coverage of the full 100 oz short price exposure with these 30 oz of long gold accounts, bullion, or futures contracts.Furthermore, the whole of the gold hound pack has followed the trail left by the crafty foxes away from the den, where gold accounts sit with no significant reserves behind them, waiting for anyone to attack, like vulnerable pups. The greatest misconception promoted by the bullion bankers is that their fiduciary commitments are equal to actual gold in a vault, or at the very least that they are equivalent to gold in the ground. In doing so, they have diverted gold buyers from ownership and possession of bullion, to holders of paper obligations. Gresham's law holds that the bad paper gold would displace bullion out of trade within the system in which it is issued into the periphery and into hoards until no more bullion is available within the system's markets. At that point, further paper gold issues would be discounted against bullion in the periphery and by hoarders (a.k.a. savers) and would dilute the overall value of outstanding paper gold. While the small innocent gold buyer or seller (all gold miners are small sellers, and are often "innocent") may not be aware of the fact of general insolvency in the gold banking business, they will recognize the low price as a discount and increase purchases without hoarding, and sell gold in premium markets (miners selling futures), the bankers will be aware of their condition. As a result, the bankers would discourage ownership of physical gold and attempt to further influence customers holding gold bars in their vaults to switch from holding gold in the vault (which requires a periodic storage fee) to a paper gold account, or financial instruments. They would offer guaranteed currency returns much greater than available in the markets to anyone willing to sell in size. The banks would also weigh upon the central bankers to make good on their obligations to be lenders of last resort to the gold debt markets. History has shown the central bankers to be reluctant lenders of gold during liquidity crunches. While offering great streams of their currency, they are not willing to part with enough gold bullion to solve the problem once it is recognized (e.g. the WA). The banks would then continue to support low gold prices by selling paper obligations so long as one more ounce is expected to come to market, and they would attempt to limit the small buyers of physical gold by attacking their currency, their credit ratings, the pricing of their exports, and anything else they can do to displace demand and enlarge supply.Large (100 tonne lots of physical gold) knowledgeable gold buyers that have been willing to spread their demand over 3-10 years by the purchase of gold delivery obligations backed by gold mine delivery contracts, central bank guarantees and bank holdings of customer's bullion as reserves, would disappear from the market for paper gold once they knew that the total available and imaginable reserves have been exceeded. The gold for oil trades presented by FOA would fall into this category, where the obverse of the gold contract is oil delivery, rather than dollars. Under current conditions, it is obvious that paper gold is discounted now to nearly 1/4 in terms of oil, compared to early1999. This implies a current price of $1000 per oz for the oil based gold accumulator of a thousand tonnes per year or more. This would induce bankers to trade intermediate-high numismatic value coins for gold bullion in 400 oz bars, for which they can obtain the high price of $1000 for large lots, rather than $270-$280. This would account for the glut of intermediate-high premium numismatic gold coins, which the European bankers, and others have held since the end of WWI. The premium price for large lots would be an inducer of banks to increase efforts at consolidating small supplies in order to deliver on their major obligations, and to displace enough gold from current physical depositors to avoid price rises. As currency inflation around the globe promotes the purchase of gold, the demand that must be met at any given dollar price grows while production costs rise with currency inflation and can be met only by the increase of promised currency denominated returns to potential gold sellers. These promised returns would increase the currency inflation, thus accelerating the approach of the breaking point in the market, that point where no further gold is willingly displaced from its holders at any possible currency denominated return.The result, in terms of currencies of gold producing nations has been that increased gold supply is induced by offering dollar indebted gold producing countries a low currency that increases their dollar supply through increased exports, allowing them an escape from their debt, South Africa, for example, reduced its dollar debt by half. New dollar creditors are rewarded with record low gold prices: in Yen, in Won, in Taiwan dollars, in Saudi Riyals, in Singapore dollars. The EU, though a net creditor to the US, it has enjoyed two decades of growing volumes of imports without a comparable rise in export volumes. That despite maneuvering to maintain positive dollar trade balances. Having negative volume trade deficits, the EU is not rewarded with the record low gold prices that net exporters (by volume) have gained. The EU, however, is preparing a debt trap on the dollar through the displacement of the dollar from its market share in denominating new international debt. This success has produced a glut of Euro on the markets, and exacerbated the dollar shortage. By my crude estimate, outstanding Euro debt has exceeded dollar debt, thus creating a potential opportunity for a squeeze on the dollar when interest rates in the Eurozone approach US levels, which US direct borrowing in the EU (see recent news of the GSE issuance in Europe) is accelerating. The EU would then have a high dollar income from the current accumulation of US assets, and due to the growth in EU trade balances with the weakening of the Euro. The Euro demand for debt payment at that future point, will meet with a great dollar supply from US assets owned by EU investors. At the point at which the dollar moves down strongly against the Euro, the Arab oil interests will have their excuse for the elimination of the dollar as exclusive currency of the trade in oil. A drop in dollar oil prices would cause the dollars accumulated for the purpose of funding future oil purchases to be released into the markets. The continued rise in the dollar exacerbates the threat of future fund flows imbalances from accumulating dollar sources, declining dollar demand and increasing Euro demand due to greater outstanding Euro debt levels and higher interest rates. We should remember that dual price markets in gold have existed for prolonged periods, and continue to exist in places such as China and India, along with dual price markets in Europe, where the value added tax (VAT) introduces the price differential between export prices and local consumption prices. Currency control systems end up doing the same in currency markets and banking controls do this in interest markets; e.g. China has uniform bank interest rates on deposits and loans that are imposed by decree. In the meantime, the gray market allows private lenders to obtain a substantially higher interest rate from private and small corporate borrowers, to which the official banking sector can not afford to lend at the government imposed rates.-----------------Note on Exchange Stabilization Fund (ESF) suspected gold market activities:Using Howe's interpretation of the ESF data, I have calculated a net short exposure of 1100 tonnes of gold in options, possibly reflecting a net 2000-3000 tonne short position that is delta hedged. -----------------For all who were surprised by the oil price rise, it should be noted that black blade has posted extensively on the oil and heating oil shortage developing towards this winter and on the current and long term inability of OPEC to increase production substantially. The current OPEC production above quota was the major component of the announced increase in the quota, thus implying extra supply of only 200k bbl/day. Supply from declining US inventories is nearing an additional 100k and similar behavior abroad probably echoes a broad expectation of lower prices early next year, contributing another 100 to 200k. Any hickup in supply can spike prices. It will be interesting to see whether the end of winter fuel accumulation early next year will cause oil prices to drop substantially. If they do, it will be even more interesting to see whether dollar reserves will be dumped by oil importers before the short Euro/long dollar position in the world markets is reversed. Buena Fe (09/11/00; 15:33:52MT - usagold.com msg#: 36455) Oil prices surge again despite OPEC's move to raise output. http://www.msnbc.com/news/457066.asp?0nm=-12T The following are excerpts form two artilce.....seems like Saudi's still playing all sides. OEC blamed speculation and high fuel taxes in Europe for much of the firmness in prices. In an official statement, OPEC expressed its "dismay" that European governments seemed unwilling to reduce their fuel taxes to help ease the problem. Saudi Arabia, OPEC's largest producer and exporter, led the push for an increase in output. "This is our best assessment of what the market needs now," Saudi Arabian oil minister Ali Naimi said. "It will improve and moderate the price, and if it doesn't we have a mechanism to trigger some more." In Washington, the U.S. government gave Saudi Arabia credit for the OPEC move but said it is too early to know what effect it will have on inventories and prices. "Whether such an increase will stabilize the market remains to be seen," Energy Secretary Bill Richardson said. "Nonetheless, this expected production increase will bring needed additional oil into world markets."2nd Article..........http://www.bloomberg.com/bbn/topworld.html?s=AOb0vHRQKV29ybGQgIt is ``our intention to bring the oil price down to close to $25 a barrel,'' Ali al-Naimi, Saudi Arabia's oil minister, told reporters in a separate press conference. ``More oil is coming and it will be 800,000 barrels of new oil,'' he said. Saudi Arabia, OPEC's biggest producer, said the oil exporters will increase output by 800,000 barrels a day over August production, contrary to earlier statements, which indicated the increase would be over the organization's quota level. Beowulf (09/11/00; 15:31:30MT - usagold.com msg#: 36454) Prediction on upcoming Bank of England Auction Since my last two predictions didn't go all that well I thought I'd give it another try.Prediction:ALL THE BANK OF ENGLAND GOLD UP FOR AUCTION WILL BE SOLD. NONE WILL BE LEFT SITTING IN THE WHEELBARROW LOOKING FOR A HOME. THE NEWSPAPERS WILL REPORT A LOW TURNOUT WITH HEADLINES REPORTING LOW SUBSCRIPTION. WHAT THE REPORTERS AND NEWSPAPERS WILL FAIL TO REPORT IS SOMEONE WALKED AWAY VERY HAPPY WITH A BUNCH OF REALLY CHEAP GOLD.How's that for a prediction. Now it's time to sit back an see how well I do this time. :)Beowulf-It's so cheap they're practically giving it away. Get it while the gettin's good. SteveH (09/11/00; 14:27:04MT - usagold.com msg#: 36453) Perspective Another and FOA can be credited with focusing our attention to the following:GoldOilEuroDollarNow, in the meantime, what has happened that to break with status quo in all four areas?Gold -- multi-year lows and manipulated and auctions and concessions on defenseOil -- multi-year highs and concession on defense.Euro -- All-time low and who knows what concessions.Dollar -- Multi-year highs and record trade deficit and low gold prices in dollars. Boy, did they know some action was about to embroil or what? CoBra(too) (09/11/00; 14:02:31MT - usagold.com msg#: 36452) @ Leigh - Hello Leigh, missed your mishap - please recover faster than the euroa/o gold - yours cb2 CoBra(too) (09/11/00; 13:39:49MT - usagold.com msg#: 36451) $-Index at hitting highest ground since 1985 (roughly 165 - low at 78) - at 115 and scratch - how high can you get? better ask a junkie! - again, since 1985 was the turning point for the US of being a global creditor nation to today's largest global debtor nation. While, the government's budget surplus is shaping up as a fata morgana of a swimming pool in the middle of the Mojave Desert, it seems as the drop of water the quenched are willing to exchange a drop of the wet sustenance for survival. A kingdom for a drop of water is the recipe' for receiving the desert's sand into your eye. - The $, has of course not been a drop, nor a trickle, no - it has been an unprecedented downpour in the deserts of devastation by the same, accentuating the sweet but short blooming season, now regarded as the only save grazing and suave meadows of the capital (n-) herds - ever more dependant and caught up by the Voodoo rainmakers of Wall and Main, who'se mad intent to prolong the growing season of the "lush" color of the greenback and offspring Dow, Naz and Lady Tsy, and sweet li'l Deri, sacking them all with the irresistible smile of trillionaires ... of "futures" erosion. As miles and miles of sand - don't guarantee the beach, though the ditch. Now sand, according to CRB's new cycle highs is becoming more expensive, even if accomodated by rising $'s, at least, temporarily as the paper may trade higer still vs sand - and of course the beach will retreat further and further - until someone comes in and claims the real view of the water - beyond the dunes. Erosion - a phenomenon only gold escapes - cb2 PS: euro and oil - heading in diametrical oppossite directions - may be leading the way to pricing in real vs relative values!? Peter Asher (09/11/00; 13:37:37MT - usagold.com msg#: 36450) Town Crier Doesn't his Share buy-in break up that Cabal a Tad?? Peter Asher (09/11/00; 13:33:13MT - usagold.com msg#: 36449) 714, LeSin, Tom Le Sin & 714I'd appreciate your comments on yesterdays theory of the "Low" Euro @ Peter Asher (9/10/2000; 22:12:17MT - usagold.com msg#: 36409)Tom: The "Dictatorship" is the Cabal of the Big Money and their Political Cohorts. Knallgold (09/11/00; 13:30:07MT - usagold.com msg#: 36448) PH in LA,oil Oil has finally decided for euro ,needs now a disinformation/smoke and mirrors campaign for the transition? TownCrier (09/11/00; 13:28:54MT - usagold.com msg#: 36447) Press release: 11 September 2000 Applies to previous BIS post.(you heard it here first) Peter Asher (09/11/00; 13:28:07MT - usagold.com msg#: 36446) PH I think it's 200,000 over the 600,000 that was PROMISED to be implemented should the price rise and hold for so many days. Sounds not like deceptive reporting but rather, defective reporter thinking! TownCrier (09/11/00; 13:26:29MT - usagold.com msg#: 36445) Wake up call! Non-Central Banks ousted from the BIS...private US institutions given the boot http://www.bis.org/press/p000911a.htm ***The BIS announces the proposed withdrawal of all privately held shares in exchange for CHF 16,000 per shareThe Board of Directors of the Bank for International Settlements (BIS), an international organisation headquartered in Basel, Switzerland, proposes to restrict, in future, the right to hold shares of the BIS exclusively to central banks (which already hold 100% of the voting rights and 86.27% of the property rights in those shares). This measure is intended to enable the BIS to pursue better its objectives of promoting international monetary and financial cooperation. To this end, the Board has decided to call an Extraordinary General Meeting (EGM) to be held on 8 January 2001 with a view to amending the Statutes of the BIS so as to exclude private shareholders against payment of compensation of CHF 16,000 per share. The authorities of the stock exchanges in Zurich and Paris, on which BIS shares are traded, have been duly informed of this proposal, and have been asked to suspend all trading in BIS shares during the day of Monday 11 September 2000. Trading will be resumed the next day. Rationale for the transactionThe BIS is an international organisation whose fundamental purpose is to promote cooperation among central banks and thus to contribute to global financial stability. The Board of Directors considers that the transaction to be proposed to the EGM is necessary to enable the BIS better to pursue these objectives. Indeed, unlike a commercial bank, the prime objective of the BIS is to employ its resources in support of its public interest functions. This is also reflected in the fact that private shareholders have no right to vote or to participate in the shareholders' meetings. Indeed, all voting rights are held by the central banks of the countries in which the shares were originally subscribed. For these reasons, the existence of a small number of private shareholders, whose interest is essentially financial, is no longer seen to be in line with the international role and the future development of the organisation.This reform continues the process commenced in 1969/70, when the Statutes of the BIS were amended notably by the creation of a third tranche of its authorised share capital, which could only be subscribed by central banks. Private shareholders currently hold only 13.73% of BIS shares, and there is very little liquidity in either of the two markets on which those shares are traded. This situation is due to several special factors pertaining to BIS shares: the number of shares traded on the markets is very small, shares of the different issues are not fungible, and particular formalities are necessary because the shares are only partly paid up. Furthermore, their transfer is subject to the approval of the BIS and also to that of the central bank of the country in respect of which the shares were issued. These structural impediments, which cannot easily be corrected given the statutory mission of the BIS, render it increasingly difficult to create orderly market conditions for BIS shares. Information concerning the shares to be withdrawnThe issued share capital of the BIS consists of 529,165 shares, of which 456,517 (86.27%) are currently held by central banks, which moreover hold all voting rights.The 72,648 (or 13.73%) privately held shares of the BIS (ie shares which are not held by central banks) originate from three non-fungible issues traded on two stock exchanges, as follows: * 33,078 shares of the American issue, traded in Zurich (on the Nebensegment/marché annexe);* 16,415 shares of the Belgian issue, also traded in Zurich; and * 23,155 shares of the French issue, traded in Paris (marché au comptant - valeurs étrangères).The nominal value of each BIS share is 2,500 gold francs, of which one quarter (625 gold francs) is paid up and the balance can be called up at any time at the discretion of the Board of Directors. [TownCrier's interjection of other relevant BIS material into this press release:-----When the BIS's initial capital was issued, the subscribing institutions were given the option of taking up the whole of their respective national issues of shares or of arranging for those shares to be subscribed by the public. As a result, part of the Belgian and French issues and the whole of the US issue are not held by the institutions to which they were originally allocated. In all, some 86% of the BIS's issued share capital is registered in the names of central banks, the remaining 14% being held by private shareholders. While all shares carry equal rights with respect to the annual dividend, all rights of voting and representation are reserved for the central bank of the country in which the relevant national issue of shares was initially subscribed. Private shareholders have no right to attend or vote at General Meetings of the BIS.The authorised share capital is 1,500 million gold francs, divided into 600,000 shares of equal nominal value (2,500 gold francs per share) of which 529,165 shares are currently issued. They are paid up to the extent of 25% of their nominal value (625 gold francs per share). The amount of the paid-up capital appearing in the balance sheet at 31 March 2000 thus stands at 331 million gold francs.The gold franc of the BIS has a gold weight of just over 0.29 grams of fine gold, which is identical with the gold parity of the Swiss franc from the foundation of the BIS in 1930 until September 1936, when the Swiss franc's gold parity was suspended. The BIS employs the gold franc solely as a unit of account for balance sheet purposes. ---end of T.C. interjection---]Practical aspects of the transactionSubject to approval of the Board's proposal by the EGM on 8 January 2001, the operation will be carried out as follows: * As from 8 January 2001, only central banks will be able to hold shares in the BIS.* The BIS will cancel the registration of all private shareholders in the books of the Bank without other formality on 8 January 2001; these shareholders will receive the amount of compensation referred to above upon surrender of their share certificates. * The BIS will take all steps necessary to end the listing of BIS shares on the Zurich (SWX Swiss Exchange) and Paris stock exchanges (ParisBourse SA) with effect from 8 January 2001. Until 5 January 2001, BIS shares will continue to be traded on these two stock exchanges in the same way as hitherto. * Shares withdrawn from private shareholders will not be cancelled, but will instead be redistributed among central bank shareholders of the BIS, in the manner determined by the EGM.----------------Hey FOA...any idea if these affected U.S. shares may then go to direct ownership by Fed (as a quasi public/private entity), or will they go to the Treasury or some other fully public institution? Cassius (09/11/00; 13:24:23MT - usagold.com msg#: 36444) @Wolavka Gotcha! Thanks, Cassius PH in LA (09/11/00; 13:18:53MT - usagold.com msg#: 36443) What 800,000 barrel increase??? There has been lots of mention in the media of an OPEC production increase of 800,000 barrels per day. Just heard an analyst on TV say that the increase announced officially today is actually 200,000 bbls on top of the 600,000 barrel increase already implemented last time. So the 800K figure is only a total increase!!How's that for deceptive reporting?If the last increase of 600,000 bbls. didn't bring down prices, what do they think another mere 200,000 bbls are going to do? Tom (09/11/00; 13:16:12MT - usagold.com msg#: 36442) (No Subject) Gold Market Short Squeeze Gold Market Short Squeeze May Not Be a Problem For Growing DictatorshipBy Jay Taylor, J. Taylor's Gold & Technology StocksPosted Monday, September 11, 2000 at 07:54 AM EST GOLD MARKET SHORT SQEEZE MAY NOT BE A PROBLEM FOR OUR GROWING DICTATORSHIPAt the heart of American freedom has been free markets. Without free markets, it is impossible to have freedom. Our Founding Fathers understood that if government began to get involved with market decisions, the United States would be like every other tyrant dominated land. It would in effect be a dictatorship.Over the years, and especially since the establishment of the Federal Reserve, we have been subject to increasing amounts of market intervention by government and our own central bank, namely the Federal Reserve Bank. Democrats, being socialists at heart, have been much more comfortable with taking freedom away from individuals for the "collective good" of the country. Republicans should stand in opposition to that trend, but not many of them have. As a result, America is moving inexorably toward dictatorship.GOLD MARKET MANIPULATION & NEW DISTURBING EVIDENCE OF U.S. DICTATORSHIPThis past week we were treated to another example of America's move toward dictatorship by John Mielke, of the Commodity Futures Trading Commission (CFT) who works in that departments Department of Economic Analysis in Washington. In a phone conversation with a lemetropolecafe member, Mr. Mielke indicated that if a gold short trader were unable to repay his obligation in gold, that did necessarily have to be compensated with the physical metal, and that other compensation could and would probably be arranged. Wow!So there you have it. If Mr. Mielke is correct and if we are correct in our belief that the powers that be have been rigging the gold market, crony capitalist friends of President Clinton and Al Gore like Goldman Sachs, Morgan Stanley and Deutsche Bank need not worry. For the sake of their friends, they will simply rule the contractual obligation of these bullion banks to deliver gold null and void and require those to whom the gold is owed to accept paper rather than gold. And with regard to paper, that is no problem because the Fed can always print more of it!The views of Mr. Miekle should be a warning to gold bugs who expect that when the short sellers get caught with their pants down, they will achieve happiness when the price of gold explodes to thousands of dollars per ounce. That would be true if you or I failed to deliver gold. But if Goldman Sachs or Chase Manhattan fails to deliver gold, do you think for one moment President Gore and Alan Greenspan would not come to their rescue by permitting them to break their contractual obligation? They will simply DICTATE to us that we must accept the failure of these big firms to honor their obligation "for the good of our country." In my humble opinion, this sort of attitude toward markets is directly related to our declining state of morality and demonstrates our acceptance of that the rich and powerful are in fact above the law, just as it was proven that President Clinton is in fact above the law. wolavka (09/11/00; 13:13:11MT - usagold.com msg#: 36441) cassius The markets are run thru complex math formulas.Certain people in power control how mkts respond to world events.If the market makers, fund mgrs. or power brokers knew that the little guy could position himself without risk and it was done by them in mass than they'd disrupt the game, change the rules, raise margin etc.The more things change the more they stay the same.Gold is not going away, changing weak hands . Cassius (09/11/00; 12:40:35MT - usagold.com msg#: 36440) @Wolavka You've aroused my curiosity!! As a consistent lurker, I always look for your little optimistic messages, though they are often very cryptic. My curiosity has gotten the best of me on your msg#36467. Firstly, shouldn't it read, "You know, that they know, it is time."? Just who is "they" in this case? And, if it shouldn't read this way, just what do you mean. Please, a little more transparency, please. Sorry, I just have to know. Thanks, Cassius wolavka (09/11/00; 12:31:37MT - usagold.com msg#: 36439) Running out of sellers Inside day, okay now gap this puppy and let's have a merry christmas. wolavka (09/11/00; 12:09:54MT - usagold.com msg#: 36438) penetration punch it thru and away we go. 277.40 wolavka (09/11/00; 11:43:32MT - usagold.com msg#: 36437) Open Interest in dec You know, that they know, it time. 714 (09/11/00; 11:34:29MT - usagold.com msg#: 36436) LeSin re: euro The Euro's strength lies in its possibility as an alternative to the US$ in international trade. But this will take a truly unified Europe such as we've never seen before.The Euro's weakness is that it affects smaller countries like Ireland and Portugal in much different ways the their larger cousins, like France and Germany. In other words, what may be good for Germany is not necessarily good for Ireland. And it is a currency dominated by France & Germany. Schroeder's comments in particular belie a certain animosity towards the euro on the part of the German powers-that-be.You are French, yes? Perhaps, Swiss? To better understand the euro's dilemna, simply visit any of the graveyards to the north and east of Paris. There you will find British buried in their own sections, some Germans buried in theirs, some Americans in their own cemeteries, and of course, a multitude of French war dead under their own memorials. Even in death, the Europeans remain divided. Such is history...and such is the Euro.*******************************************Salaam. wolavka (9/11/2000; 11:01:31MT - usagold.com msg#: 36435) we need to take out the magic # in dec gold, no inside day, close it higher , and get on with it!!!!!!!!!!!! beesting (9/11/2000; 9:49:35MT - usagold.com msg#: 36434) Homestake Mining to close Flagship Gold Mine in Lead South Dakota. http://biz.yahoo.com/rf/000911/n11537000.html In a press release, Homestake (NYSE:HM - news) Chief Executive Jack Thompson said thatdespite trying to restructure and achieve efficiencies in the mining operations of the 124-year-oldmine in 1998, the fall in the gold price since then prevented the plan from working. USAGOLD (9/11/2000; 9:04:20MT - usagold.com msg#: 36433) I should have added. . . that van Eck is a goldmeister of the first order. . .A snippet from a recent e-mail update:"The recent slumber of the Gold sector has caused some analysts and investors to finally throw in the towel on Gold. However, the vast majority of sector investors have decided to stay with the metal. For many of them, Gold is like a religion. The metal's role as a store of value over the course of thousands of years is more important to them - than the lack of positive action in the new world of PAPER MONEY. When Gold was removed as a monetary policeman thirty years ago, many people were afraid that governments would begin to print money as fast as the presses would allow. That has certainly been the case - with the U.S. government among the biggest offenders. As a result, the value of the U.S. dollar has collapsed in the past twenty to thirty years."MK Comment: Van Eck is predicting a strong gold rally. USAGOLD (9/11/2000; 8:52:21MT - usagold.com msg#: 36432) All. . . . http://www.usagold.com/gildedopinion/VanEckOPEC.html A couple weeks ago I mentioned receiving permission from Adrian van Eck to re-publish his revealing behind the scenes look at the upcoming OPEC parley in Caracas. The link above takes you to that important analysis in our Gilded Opinion section. I hope the Forum gains from his insights. This will be the first time since 1975 that leaders of the OPEC nations will be meeting -- that's "leaders" not oil or finance ministers. Van Eck tells the story of Venezuela's Hugo Chavez -- his ties to Fidel Castro and his hawkish views on oil and oil pricing. Chavez has already played a key role in OPEC politics and appears to be positioning himself for an even greater role. One cannot take political militancy out of the OPEC equation both in the Gulf -- where Palestine remains a key issue -- and in the third world where IMF/World Bank policies have wreaked considerable havoc and a growing anti-American sentiment. Though on the one hand, the producers feel a need to appease the G-7 nations and up production, they must also answer to their own people -- a quandary van Eck touches upon with great skill. USAGOLD (9/11/2000; 8:36:44MT - usagold.com msg#: 36431) Euro Continues Plummet, Gold Off Slightly DAILY COMMENTARY (9/11/00) www.USAGOLD.com . . .Gold was down in early New York trade with the plummeting euro the chief feature of this morning markets -- down over one cent. Physical purchasing dominated Asian trade and the European market was described as quiet and thin. Financial World News (FWN) reports one analyst's view that "gold's performance in the face of the strength of the currency is relatively encouraging, with some more bullish elements of the market looking at oil prices--not just as the precursor to potential inflation (or economic malaise given developments in France and the U.K.), but also with a view to considerably enhanced Middle Eastern gold offtake." We would add to that the potential for European "offtake" under the circumstances. One could safely say that the recent developments there are not the sort of thing that would produce a great deal of confidence -- currency plummeting, byways blocked by angry truckers, oil and gasoline prices skyrocketing with winter coming on, and so on. Wim Duisenberg's reaffirmation of a hands-off, non-intervention policy with respect to the euro in a speech over the weekend was probably the chief driving force the single currency's drive for low ground. I'm sure he had hoped for the opposite reaction. One keeps waiting for some signs of a grand and dramatic policy to emerge -- perhaps a futile hope (if you happen to be a European saver). So far, the dramatic gesture has remained under wraps. Back in the USA, we have a full menu of government reports which if reported objectively should put some color in the inflation picture. Wednesday's full moon will be accompanied with the Current Account report and on Thursday we have Retail Sales and Producer Prices, followed by Consumer Prices on Friday. It's a sad commentary that as part of setting the stage for a menu of government reports that one must offer a caveat that they might be less than accurate, or better put, less than honest. Perhaps we need a labeling law for government reports. That's it for today, my fellow goldmeisters. Have a good day and see you here tomorrow.------------------------------------------------------------------------Had it with the tired, one-sided anti-gold financial press mentality? If you want a fresh view of the gold market go to the link above for an information packet on gold ownership which includes our widely read newsletter, News & Views: Forecasts, Commentary & Analysis on the Economy and Precious Metals. We offer solid commentary in a rapid fire, no-nonsense, bullet format designed for busy people who want gold related news and opinion without the unnecessary fluff. And stay tuned here for our Daily Commentary.Please call Marie at 1-800-869-5115 or click here to request News & Views as well as our helpful introductory information packet for gold investors.------------------------------------------------------------------------We invite you to stay tuned to the gold market through our DISCUSSION FORUM featuring round the clock gold news & commentary from the public.------------------------------------------------------------------------PLEASE REMEMBER: It is your purchase of gold from Centennial Precious Metals that nourishes these pages.Call us at 1-800-869-5115 for prices and to have your questions answered. Black Blade (9/11/2000; 7:55:27MT - usagold.com msg#: 36430) Petroleum higher, unfortunately PMs lower http://www.crbindex.com/curquote/crbquote.mhtml Petroleum still moving higher:Natural Gas 4.955 +0.075 +1.54 % Heating Oil 1.003 +0.0081 +0.81 % Crude Oil 33.98 +0.35 +1.04 % Black Blade (9/11/2000; 6:47:55MT - usagold.com msg#: 36429) Nick Goodwin's recommended gold portfolio (September) http://www.mips1.net/MGGold.nsf/Current/4225685F0043D1B242256956004BFB39?OpenDocument Interesting analysis of gold-oil relationship, and bias toward unhedged miners. Though I believe that petroleum is headed much higher, it is close to the mark as gold tends to lag oil. This is a result of inflationary pressures from oil that show up later in the cycle and gold bounces as a result. We live in "Interesting Times". Black Blade (9/11/2000; 6:36:10MT - usagold.com msg#: 36428) Petroleum Higher on OPEC Oil Production Increase. http://www.crbindex.com/curquote/crbquote.mhtml Petroleum moving higher. Oil up +$0.12 at $33.75/bbl, and Heating oil over a buck at $1.002. Now to see how Petroleum performs in NY. Also, refineries are working "Flat Out!" at near full capacity. A shutdown here, and explosion there, throw in a little necessary maintenance, and the noose draws tighter. Inflation and ultimately recession is in the cards. We are watching history unfold. The end of cheap oil and "Hydro-Carbon Man?" wolavka (9/11/2000; 6:22:30MT - usagold.com msg#: 36427) Nice week to be a goldbug Looks good!!!!!!!! Black Blade (9/11/2000; 6:07:30MT - usagold.com msg#: 36426) "Morning Wakeup Call!" Even OPEC Couldn't put Humpty Dumpty Together Again! Sources: BridgeNews and AP THE EASTERN FRONT:Asia Precious Metals Review: Physical demand supports spot goldBy Mari Iwata and Polly Yam, BridgeNewsTokyo--Sept. 11--Physical demand supported spot gold in Asia on Monday in sluggish trading, dealers said. After the price of gold tumbled in the U.S. market Friday, bearish sentiment increased in the Asian market with many players expecting the price to move within a narrow arrange of U.S. $270-274.50 per ounce in the near term, they noted.Black Blade: This is really an old story that is recycled over and over in Japan. Yawn.China Press: Gold to be traded in the domestic market in two years Shanghai--Sept. 11--China plans to allow gold to be freely traded in the domestic market in two years, according to a report in the Shanghai-based Wen Hui Daily, quoting Wang Dexue, the director of the Gold Bureau under the State Economic and Trade Commission. But China won't completely open the market to international trade until the yuan--the Chinese currency--is fully convertible, the paper reported Wang as saying. (Story .10689)Black Blade: Potentially over a billion customers for Au. Then an ad campaign "Over 1 billion sold" just like McDonald's.OIL FRONT:OPEC IS EXPECTED TO INCREASE ITS OIL OUTPUT BUT THAT IS NOT LIKELY TO LOWER BOOMING PRICES St. Louis Post-Dispatch Americans fret about the cost of heating their homes. French truckers blockade roads to protest high gasoline prices. Asians debate how to fight inflation stoked by costlier oil. Consumers worldwide are angry about high energy prices and fearful of worse to come. Still, ministers from the 11-member Organization of the Petroleum Exporting Countries aren't expected to provide much comfort at a meeting Sunday to consider whether to produce more. Analysts predict OPEC will agree to raise its official output by no more than 800,000 barrels a day - just 3 percent of each member's production quota. They say such an increase would do little, if anything, to rein in oil prices, which have more than tripled in the past 20 months and have continued rising this week to new post-Gulf War highs. "There's no comfort factor anywhere," said John Toalster, an independent energy consultant in London. "It's a severe situation, no doubt about it." Since OPEC slashed output in March 1999, oil prices have surged to levels that threaten to derail the locomotive of global economic growth - the United States - and snuff out fragile recoveries in Asia and Latin America. Crude prices that languished at less than $11 a barrel in December 1998 bounced above $34 a barrel this week on commodity exchanges in New York and London. As a result, developing countries are finding that higher bills for imported oil are eating into resources for social programs and investment. Citizens of wealthier nations are feeling the pinch, too, in the form of pricier visits to the gasoline station and soaring prices for heating oil. OPEC Secretary General Rilwanu Lukman suggested Thursday that the group's members will agree in Vienna, Austria, to increase their production of crude. "If we're satisfied the market needs more crude oil, we will put more in if we are in a position to - and we probably will," he told the British Broadcasting Corp. OPEC, which pumps a third of the world's oil, has an official daily output of 25.4 million barrels excluding Iraq, which exports its crude under a special U.N.-monitored program. But the cartel's members are now producing 674,000 barrels a day above their quotas, said Leo Drollas, chief economist at the Center for Global Energy Studies in London. Drollas said an increase of 500,000 barrels a day was "in the cards" in Vienna, but he warned it would only serve to legitimize the bulk of OPEC's current overproduction and would do nothing to cool prices. Markets need from 800,000 to 1 million additional barrels each day for prices to ease below $30 a barrel, he said. An increase of this size could only come from Saudi Arabia, the No. 1 producer in OPEC and the world. Except for perhaps Kuwait and the United Arab Emirates, no other OPEC member has the spare capacity. Saudi Crown Prince Abdullah told President Bill Clinton in New York on Wednesday that his country wascommitted to pushing prices down to about $25 a barrel. He said OPEC would raise output by about 700,000 barrels a day, according to a source familiar with the talks. Saudi Arabia and its OPEC partners recognize that high prices can backfire on them in the long run. If prices stay high, importers will seek out cheaper substitutes for oil, and non-OPEC producers will find it profitable again to pump from high-cost wells. Given the brittle balance of supply and demand, a glut of oil could send prices crashing. That seems a distant possibility for now. In France this week, irate truckers blockaded fuel depots. Officials from 21 Pacific Rim countries met Thursday in Brunei to discuss ways of coping with the rise in oil prices. OPEC has tried to deflect criticism for prices by pointing out that many rich countries charge heavy taxes on gasoline.Black Blade: I need not say anything here. This says it all. Suffice it to say that nothing is changed, prices will likely continue higher, and the oil fields are draining out that much quicker. Recession is on the horizon as the energy crunch arrives.Meanwhile, Oil is only off -$0.18 to $33.45/bbl and poised to attack $40.00/bbl. NG is off slightly at $4.85 Mbtu and likely to pass $5.00 Mbtu and passed $8.00 Mbtu come this winter. Heating Oil is up +0.31 at 99.80 cents and going much, much higher as supplies are extremely thin going into the Fall. Au is up +$0.40, Ag off 2 cents, Pt down -$6.00 on profit taking from a good rise last week, and Pd paper trade is off -$10.00. On Thursday the PPI number and on Friday the CPI number will be tweaked to match the political goals of the current regime in Washington, D.C. and petroleum prices will likely be discounted. The S&P futures (-3.00) are pointing to a lower open on Wall Street after a near disaster on the Asian indices overnight. We approach interesting times. LeSin (9/11/2000; 6:02:37MT - usagold.com msg#: 36425) Straight Talking Please and EURO'S Strength To the Economists, Accountants, and Leaders of discussion on this fine forum. I am a lay person as stated many times before. My request of the Masters, Experts, Trail Guides, Friends of Others and Giants please dispence with the "Metaphores", "Allegories" and "Parallel" Thought Explanations when explaining Gold, Precious Metals and Currency Wars. I for one would welcome simple, plain, and straight talking forms of discussion. It is a fact that a stadium full of economists could not agree on the state of macro economics let alone the remedies for it. Ladies & Gentlemen I would be most grateful for comments regarding the Euro's Strength as I see it, albeit over simplified. I adopt a marketing perspective to Euro, while many economists (lay & professional) here adopt complex theory a certain laws from text-books. The Euro at present is not being hammered - it is being "Discounted". It is gaining "Market-Share" a discounted Euro is providing a cheap entry into the Euro settlement system and a "Reasonable" "Alternate-Way-Out" of the US$ hegemony. Apologies for spelling erros, my excuse Enlish is my second language. "S" TownCrier (9/11/2000; 2:00:16MT - usagold.com msg#: 36424) Change coming on Chinese winds... http://straitstimes.asia1.com.sg/money/regb4_0911.html From the linked article, China's Finance Minister Xiang Huaicheng said after the central bank launched liberalisation of interest rates on bank deposits and loans last week as the beginning stages of broader reforms, China "will continue to accept our responsibility to contribute towards the Asian economic recovery," and that the stability of the yuan had been helpful in that regard. According to the article, he told his counterparts at this weekend's Asia-Pacific Economic Co-operation finance ministers' meeting that "China was now focusing on its social safety nets as a precursor to the reform of its lumbering state-owned enterprises."And from Bridge News...China Press: Gold to be traded in the domestic market in two yearsShanghai--Sept. 11--China plans to allow gold to be freely traded in the domestic market in two years, according to a report in the Shanghai-based Wen Hui Daily, quoting Wang Dexue, the director of the Gold Bureau under the State Economic and Trade Commission. But China won't completely open the market to international trade until the yuan--the Chinese currency--is fully convertible, the paper reported Wang as saying. The Invisible Hand (9/11/2000; 1:31:25MT - usagold.com msg#: 36423) Reality Check: no formal announcement of OPEC decision http://news.bbc.co.uk/hi/english/business/newsid_918000/918593.stm This is from the BBC. The link on the entry of the webpage (http://news.bbc.co.uk) also says that there is no timetable. Wait till Wednesday?Monday, 11 September, 2000, 04:37 GMT 05:37 UK Oil down after Opec boostOpec ministers continue discussions on Monday Oil markets have reacted positively to the reported decision by ministers from oil producing countries to increase production by 3%. In Japan, the price of light crude fell by almost one dollar a barrel in early trading. Ministers from Organisation of Petroleum Exporting Countries (Opec) are continuing their talks in Vienna on Monday. There has been no formal announcement on the decision to raise daily production to 800,000 barrels a day. During the past week, the price of oil hit a 10-year high of $34 per barrel. Analysts say it is unlikely that prices will drop to the psychologically important $30 a barrel threshold, because of the coming winter in many oil consuming countries. The BBC economics correspondent says that with oil stocks at their lowest level for 20 years, the increase in production will in the medium term only restrain the upward movement in prices. Qatar's Oil Minister Abdullah bin Hamad Al Attiyah said Opec "did all that we could, but we cannot solve the whole problem". He added that Western governments had to address the issue of high fuel taxes. Opec says it wants oil prices of around $25 a barrel, with a target band of between $22 and $28. European reactionMinisters from oil consuming countries have given a cautious reaction to reports of the increase in oil production. In France, where the crisis led to a six-day blockade of fuel refineries, Finance Minister Laurent Fabius, said the decision was a "step in the right direction." But German Transport Minister, Reinhard Klimmt, said: "This is still not enough. Opec must produce more." In the US, White House chief of staff John Podesta said: "We're short on oil... I think this is a substantial increase, led by Saudi Arabia... but we're going to have to take a hard look and see whether it's enough." The organisation's third production boost this year is towards the lower end of expectations. Saudi Arabia, for example, had pressed to raise production levels by a million barrels a day. High oil prices increase inflation and restrict growth in America and Europe, who both import the majority of their oil supplies. Simply Me (9/11/2000; 0:23:57MT - usagold.com msg#: 36422) @Black Blade Greetings and good fishing to you! Appreciate your keeping an ear open for new on the euros for oil front. It may be a premature rumor...but it makes too much sense to me to be a false rumor.simply me Hard assets...Easy access (9/11/2000; 0:18:52MT - usagold.com msg#: 36421) ATTENTION EUROPE: We would like to introduce YOU to the services of Centennial Precious Metals, Inc. http://www.usagold.com/announcement/europeantelegram.html USAGOLD / Centennial Precious Metals, Inc. has recently completed a lengthy process of arrangements in order to now offer to our friends within the European Union prompt, discreet, insured delivery of gold...directly to your door!Please visit this link to learn more about how you, too, can join thousands of our satisfied American clientele who have already come to rely on Centennial's friendly services and professionalism to fulfill their gold requirements for nearly 30 years.Please remember: It is your purchase of gold from Centennial Precious Metals that nourishes this website; including the daily market reports and monthly on-line newsletter! Simply Me (9/11/2000; 0:17:27MT - usagold.com msg#: 36420) @Topaz @Leigh Hi Topaz, Thanks for the news. That takes one stick of dynamite out of the bomb. I really thought Arafat would put off the confrontation. He's become much less confrontational since he turned from active terrorist leader to nation-in-exile leader. I'm also looking for news on a euro for oil deal on September 13th. Will appreciate anything you hear/read on that front also!simply meHi Leigh, Best wishes for a speedy recovery. Broke my left hand when my two youngest children were still in diapers. In a cast up to my elbow and told not to get it wet. With one and two year old boys in a tub together?...No way. When they took the cast off there were dried Spaghetti O's and mashed potatoes (the kids' favorite foods)stuck in places I couldn't reach! Good luck. I think the improvised wheelchair idea is great! Crutches?..impossible. I'll bet you'll have some good stories to tell before it's all over. Doctors just have no idea what they're asking when they put restrictions on anyone who must care for young children!simply me ViewYesterday's Discussion.
Permission to reprint is hereby granted where the USAGOLD name is cited along with our web address, mailing address and phone number. For electronic reproductions, citing the post heading and the http://www.usagold.com/cpmforum/ website address as the source is sufficient.