Welcome to the USAGOLD Gold Discussion Archives. 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...
The opinions posted by all guests are expressly their own and do not necessarily represent the views of the management or staff of USAGOLD - Centennial Precious Metals. The hosting of the public discussion shall therefore not be construed as an endorsement by USAGOLD - Centennial Precious Metals of any of the opinions posted here.
ARCHIVED DISCUSSION FROM 7/1/2004 All times are U.S. Mountain Time (Yesterday's Discussion.) Sundeck (7/1/04; 20:12:43MT - usagold.com msg#: 122700) As Greenspan Chases Inflation, Critics Shout, 'Faster!' http://www.nytimes.com/2004/07/01/business/01place.html?th Wha...even the New York Times has seen what is happening.Snip:"...Inflation and market interest rates are far ahead of Alan Greenspan's federal funds rate, which he raised yesterday to 1.25 percent. Now the nation will see how well Mr. Greenspan, the Federal Reserve chairman, plays the game of catch-up. Fears that Mr. Greenspan has opened wide the door to inflation in the United States by keeping interest rates too low for too long prompted a sell-off in the bond market recently. That has pushed short- and long-term rates far above the federal funds rate and produced the worst quarter for bond investors in almost 25 years. ..."Sundeck:Mr Greenspan has little alternative, in my view. He is like a lumberjack riding a round log in a raging river. A bit this way...oops! A bit the other way...dang! How DO you ride this thing?In my view, it would bring joy to Greenspan's heart (and to the Treasury) to see price increases (inflation) take off, followed by wages, followed by prices, followed by wages,...etc....a lovely theme, with Bernanke's printing press chugging in counterpoint!Devalue that dollar, trash repayment on debt...the best alternative by far (for the US). Just like the 70's? No? Wake up Paul Volker II, your time is coming...;-) Ned (7/1/04; 19:37:31MT - usagold.com msg#: 122699) Saddam's a funny, funny guy! A prosecuting lawyer gave his monologue today about the charges facing the ousted Iraqi leader. After several minutes of rambling a lengthy series of 'charges' Mr. Hussein was asked if he understood the 'charges' of human rights abuse and crimes against humanity laid against him.Mr. Hussein responded that the 'only person that has violated human rights and has commited crimes against humanity was George W. Bush.' (paraphrase)Mr. Saddam Hussein.........comedian. R Powell (7/1/04; 19:37:25MT - usagold.com msg#: 122698) Free Gold CoBra(too)...post 122695...agree entirely. Thanks for saying it. rich Cavan Man (7/1/04; 18:12:47MT - usagold.com msg#: 122697) Hey Cobra... "Gold is and was its own intermediator - and it will carry on in the same fashion ... gold for the free - cb2"Good thought on this weekend CB and....pooh pooh psychophantitis...CM Goldendome (7/1/04; 17:37:24MT - usagold.com msg#: 122696) Manipulation in the transport index? http://www.financialsense.com/Market/wrapup.htm Lately--the past few months--chartists and Dow theorists have been confused by inconsistencies in the stock markets. The industrials seem wanting to fall, but don't... and the transports seem unwilling to confirm weakness in the industrials.Today on a neighboring site a technician, Martin Goldberg, in an article, shows how to control the stock market for $12 million/day. Peanuts to any group with access to unlimited money (like access to Gov'mnt money).Goldberg's argument, briefly, discusses how easily and cheaply the transport index could be manipulated through only a few weighted stocks in that index. And guess what? Those stocks ALL show strong support over the past year!He also asserts that this type of low budget influence would create far less notice than throwing large wads of dough at major stocks.The confusion caused by the transports refusing to confirm any Dow industrial decline has caused some to buy the industrials and others to fear shorting it.Click on over there and read it yourself...not too long an article. CoBra(too) (7/1/04; 16:19:02MT - usagold.com msg#: 122695) Free Gold? - ... I'm kind'a reluctant to post again on this august forum. A forum, which has helped keeping my sanity for many past years - and yes, I believe in Gold! Do I believe in "Free Gold"? That may be more a matter of semantics - free gold, after all is a personal choice to accumulate for long term saving or not. Oh, and yes it was only in the land of the free, where possession of gold was prohibited for almost two generations, ever. No-where else in the world has confiscation of PM's ever happened in this sense. OK, it was FDR's New Deal, which dictated strong measures against the depression of the 1930`s and the new deal only prolonged the suffering.Anyway, GOLD does not have to be freed from any shackles. Whether its the ESF (PPT), LBMA, Crimex or any other entity papering over the real price finding menachism. Real gold will always find its real price. Well, gold is the only real price and in the end all real assets will be priced according to gold's dictate.In essence, I'm really getting a bit tired of the same old tirades of the coming of 'free gold'! Gold is always free and at liberty to ascertain its freedom by manefesting its challenge to any fiat bondage ever.That's what gold is just re-estrablishing now - and doesn't and hasn't needed any free gold advocates ever. Gold is and was its own intermediator - and it will carry on in the same fashion ... gold for the free - cb2 Belgian (7/1/04; 15:10:22MT - usagold.com msg#: 122694) @Knallgold Just before leaving on holidays...one more reflexion on "FreeGold"...We all, never realized (suspected), for more than 2 decades, that Gold was "un-free" in the first place and now we don't believe in the possibility (reality) of FreeGold....See you later Knallgold... TownCrier (7/1/04; 15:07:10MT - usagold.com msg#: 122693) Trichet Q & A: on the BIS, and on being under control -- you may be surpised to learn by whom http://www.ecb.int/press/pressconf/2004/html/is040701.en.html Press Question:Mr Trichet, I would like to refer to the annual report of the BIS. They raise more general questions and I would be interested in your opinion. One thing is that the BIS says there is an asymmetry in the reaction of central banks: they loosen in the downswing but they do not tighten in the upswing in the same way. So they say that you can do that once, but then you have no room for manoeuvre left and that is dangerous. What is your opinion on that?Trichet:First of all, the BIS is an international institution which is important, with a close relationship, as you know, with central banks and which is there precisely to ask pertinent questions or to suggest further deliberations in important areas at the global level because it is a fully international institution. And I am very happy myself to participate in meetings in Basel under the auspices of the BIS, in particular the G10 meeting, the global economy meeting which we organise every two months.That being said, the question is stimulating. I trust that the question is not too much addressed to the ECB in your mind. But it is a theoretical question of great importance.Are we symmetric? Are we asymmetric? How do you deal with this very important question of asset inflation? What kind of responsibility do we have ourselves as central bankers when taking account of asset inflation?You know that we are reflecting a lot on that, that this institution has developed a special understanding and vision, and that we are a little bit original in the constituency of central banks the world over.We consider that on top of the possible interaction between asset inflation and possible bubbles and the monetary policy oriented towards price stability, which is the rule of the game for all central banks, we are keen ourselves on having a monetary analysis. And we trust that it is a way not only to better anchor inflationary expectations, because in the long run inflation is a monetary phenomenon, but also a way of perhaps taking more closely into account phenomena like asset inflation and bubbles because they are fed by monetary expansion.So we trust that perhaps I say perhaps, I am cautious, I am prudent our monetary policy concept is well-suited to this particular responsibility that is part of the overall BIS remark.Question:Mr Trichet, the Centre for European Policy Studies in its annual macroeconomic report this week had a number of criticisms of the ECB. One of them was that transparency had actually reduced because under your predecessor at these press conferences we had a feel for how the debate was evolving within your rate-setting meetings. It also suggested that you should have a bias. I wonder how you respond to these criticisms and whether you could, perhaps, fill us in on how the debate is evolving or has evolved in the meetings?Trichet:Frankly speaking, it seems to me that all the criticism about the absence of transparency of the ECB can be taken with a grain of salt.Do you know another central bank that holds a press conference immediately after the decision of the monetary policy council? Do you know another central bank that produces four or five full pages assessing the situation, expressing the diagnosis, not in two paragraphs but in a more detailed way?Do you remember that, when we launched the single monetary policy concept of the euro at the start of 1999, the state of the art of central banking was to say absolutely nothing at the moment of the decision and to wait for five weeks before giving an indication of the reason why a decision had been taken? So, not only do we try to be as transparent as possible but also we, more or less, contributed to changing, for the sake of transparency, the state of the art of communication in central banking.So, all that being said, I cannot invent a bias where we have none, and change for your pleasure the assessment of my colleagues in the Governing Council.We try to do our best. We are under the control of public opinion. We are under the control of markets. We are under the control of savers and investors, and not only in Europe but the world over.On the basis of our credibility they are managing trillions of euro, and we try our best to maintain the credibility that we have in their eyes.And I mention this again because it is very important: we shipped to the euro area the yield curve that was the best yield curve available before the euro area was set up. That has made it possible to generalise for 306 million inhabitants a level of market interest rates that was previously the privilege of only a fraction of those 306 million inhabitants.To the extent that we started from scratch, this relied entirely upon the credit of stability that was given to us on the basis of our credibility. The credibility of the institution. The credibility, perhaps, of the transparent interaction with you and, through you, with the full body of observers, savers and investors. And also the credibility of our monetary policy concept, which -- at the beginning -- was perhaps criticised a little but it is now less and less criticised, it seems to me.-----(from press conference at url)------Again, "We are under the control of public opinion. We are under the control of markets. We are under the control of savers and investors, and not only in Europe but the world over. ... THEY are managing trillions of euro..."And to this point, I add the remark in the previous post citing Trichet's introductory comments: "Annual M3 growth rates have fallen over recent months. While this decline partly reflects base effects, the portfolio decisions of firms and households are also returning to normal as financial uncertainties have receded. Indeed, there are signs that savings are increasingly being allocated to long-term assets outside M3 rather than to liquid monetary assets."Taken as a whole, you can see his comments regarding control are exactly right. Remember FOA's truism -- own gold and thereby you control your would-be controllers.With a mark-to-market reserve structure in effect upon its own gold holdings, the ECB is indeed signalling "that this institution has developed a special understanding and vision, and that we are a little bit original in the constituency of central banks the world over".Could gold possibly ask for a better Friend? "Forth! And fear no darkness!"R. TownCrier (7/1/04; 13:18:49MT - usagold.com msg#: 122692) Trichet: on inflation risk and on savings http://www.ecb.int/press/pr/date/2004/html/pr040701.en.html ECB Press Release:1 July 2004 - Monetary policy decisionsAt today's meeting the Governing Council of the ECB decided that the minimum bid rate on the main refinancing operations and the interest rates on the marginal lending facility and the deposit facility will remain unchanged at 2.00%, 3.00% and 1.00% respectively.The President of the ECB will comment on the considerations underlying these decisions at a press conference starting at 2.30 p.m. today.===============(excerpt from the press conference)Looking beyond the short term ... the outlook remains consistent with price stability, provided that wages develop moderately, in line with the latest evidence available. Nevertheless, there are some upside risks to price stability. The strength of global economic dynamism may continue to exert upward pressure on commodity prices, including oil prices. ...... Against this background, the potential risk of second-round effects via wage and pricing behaviour needs to be monitored closely. ..... Finally, measures of long-term inflation expectations derived from financial market indicators remain relatively high. While these indicators should be interpreted with caution, their development calls for particular vigilance.Moving to the monetary analysis, the overall picture remains unchanged from our previous assessment. Annual M3 growth rates have fallen over recent months. While this decline partly reflects base effects, the portfolio decisions of firms and households are also returning to normal as financial uncertainties have receded. Indeed, there are signs that savings are increasingly being allocated to long-term assets outside M3 rather than to liquid monetary assets.[Randy's interjected note: That is EXACTLY how you should view your own gold holdings... as savings from funds that have been allocated to long-term assets outside the Monetary System proper.]However, despite the recent moderation of annual M3 growth, there remains substantially more liquidity in the euro area than is needed to finance non-inflationary growth. While a significant part of the excess liquidity has accumulated as a result of past portfolio shifts, low interest rates have also fuelled the build-up of liquid assets. The low level of interest rates also supports credit growth. The stock of excess liquidity, if it persists, may pose an upside risk to price stability over the medium term.---------(policy statement available at url)--------Bottom line: "Risk to price stability" means effectively a risk of weakening of the currency within the monetary system. Hence, the motivation for savings to be "increasingly allocated to long-term assets outside M3". Choose gold and thus get as far away as possible -- while still preserving your liquidity! Oh, happy day!Call USAGOLD~Centennial for all the professional help needed to get the job done right.R. Goldless Heathen (7/1/04; 11:56:50MT - usagold.com msg#: 122691) On a lighter(several ton) note http://channels.netscape.com/ns/news/story.jsp?id=2004063023190001589162&dt=20040630231900&w=APO&coview= Man saves 1,000,000 pennies on a bet, can't get rid of pennies or collect the wager prize. Many of you 'prolly already saw this, nonethless here is the link; USAGOLD / Centennial Precious Metals, Inc. (7/1/04; 11:36:30MT - usagold.com msg#: 122690) Take the first hassle-free step toward learning what others already know... http://www.usagold.com/Order_Form.html Knallgold (7/1/04; 11:35:14MT - usagold.com msg#: 122689) Aristotle msg#: 122666 Wrong side of the bed?No Sir,I thought my tongue was enough in cheek to sound ironic.I might sharpen my english further for the next time.So FreeGold has already been born officially,hmm,I thought it is still an embryo,an embryo none except the mother knows of.Then I have to rewrite my data,I guess with the date of birth you mean the WAG1 or the mark-to-market,if true,the "June rumour" of "ECB to free Gold" would mark pregnancy.I had a lot of discussions with my father and altough he aknowledges fully Golds role present and past,he just doesn't believe in FreeGold "son,this will never come,they won't let it happen".What can I tell?You have to admit this concept needs some powerful backing,I mean just because it might be a good idea and you are a good guy won't bring it.(no offense meant)I guess it is about not seeing the newborn,or,respectively, not seeing him because he is not there.Its also the major hurdle in talks with other people,though they do listen,especially if you tell them the Goldstandard is the past and something new with a positive role for Gold had to be created.But,will they go out and buy Gold? Ag Mountain (7/1/04; 11:33:02MT - usagold.com msg#: 122688) Who are they, Solomon Weaver? Aren't they people, too? Some of your concerns might be the result of letting your fear run wild and your worries get a lot less urgent if you remind yourself that politicians put their pants on one leg at time like everybody else. Don't kid yourself that thier own personal stake in gold is any less than our own, and the reality is nobody wants to cut the floor out from under himself. So the trick isn't to worry about the floor being taken away but to be smart enough not to take the floor for granted. The more you have the more room you'll have to move. Clink! (7/1/04; 11:29:22MT - usagold.com msg#: 122687) @ Federal_Reserves That was a fascinating read about the decline of the Roman Empire. There are so many parallels with current affairs, it's scary ! The part I particularly noted was :-The cornerstone of Diocletian's economic policy was to turn the existing ad hoc policy of requisitions to obtain resources for the state into a regular system. Since money was worthless, the new system was based on collecting taxes in the form of actual goods and services, but regularized into a budget so that the state knew exactly what it needed and taxpayers knew exactly how much they had to pay.C! Sounds like an earlier version of burning confetti giving way to the real thing ! Thanks for sharing that with us.C! Solomon Weaver (7/1/04; 09:34:50MT - usagold.com msg#: 122686) Open letter to officials who need to be enlighted about gold ownership Dear FriendsI have authored the following letter and will be sending it out to various elected officials and small town bank owners in my terrain....hope some of you might cut and paste it out to your computers....and one day do the same.My idea is to send it out to a certain list now, and then IF we see moves afoot to restrict PM trade, to resend it then with the reminder that they had been alerted before.. . . . PRECIOUS METAL MARKET ALERT (By Poor Old Solomon , June 25, 2004) CONCERNS OF POTENTIAL LEGISLATIONS BANNING OR LIMITING THE OWNERSHIP OF PRECIOUS METALS AND COMPANIES MINING PRECIOUS METALS. Dear honored official, We are writing this letter as a general letter which may be presented to government officials in any function who may influence legislation, or may simply have concerns about the financial rights of honest citizens living within their constituencies. The topic of concern is the right of American citizens to own and invest in precious metals such as gold, silver, platinum, and palladium. Of very specific concern is that legislators may be requested (lobbied) to pass or enforce new laws which severely restrict, or even outlaw the rights of Americans to own (or profit from) the sale of precious metals or companies involved in the mining of precious metals. There is also a concern that the use of gold as money amongst illegal drug traders, mafia, and terrorists, will be used as an excuse to pass legislation against law abiding American citizens who own precious metals. Lastly, were there to be a serious financial crisis in America which resulted in high levels of inflation and loss of global dollar purchasing power, Americans who have traditionally used only dollars, might move in a panic to convert portions of their savings from dollars to precious metals. The escalating price of gold, silver and other precious metals, in this case, would be an accurate barometer of the problem with US Dollars. A brief summary of the situation is presented, and all that is asked is that you, as a legislative or enforcement official become attuned to the situation. America is both a democracy, where every vote counts, and a representative democracy, where citizens expect their representatives to vote and act in accordance with their conscience and beliefs. The primary understanding which we would like to communicate about precious metals is that at many times in the past, both gold and silver have been used as money. All large governments have long ago discontinued the use of gold or silver in legal tender coinage, and have even gone so far as to sell much of their reserves of gold and silver. Gold and silver are no longer considered money, but their historic use as money has left a legacy of monetary value. Most Americans would easily equate treasure chests of gold and silver coins to wealth or riches. Platinum and palladium, along with silver, are primarily considered industrial metals. A unique property shared by all these metals is that they may be fabricated into coins and ingots. Coins can, in some cases have collectable value, and ingots of various sizes are usually convenient forms of high purity bullion metal. Thus, although the primary use of silver, platinum and palladium is now industrial, a portion of the world reserve of each is in the form of small coins and bars which are held by investors. There are actually several ways to own precious metals. The most obvious and most simple is to buy a coin or bar from a dealer who handles them. For persons or corporations that want larger amounts of precious metals, they may choose to buy a certificate that gives them title to a certain amount of a precious metal in a vault in a bullion bank. The daily price for all of the four precious metals is determined in international markets and is known as the spot price. In addition, there is a large amount of gold and silver trading in the futures markets as futures contracts and options. A person or company with large amounts of money and short term investment time horizons of hours, days, or months will often choose to place their money in the futures or certificate trade. These markets are large, with active trading, and therefore allow large investors to move in and out with low transaction costs. Although gold is no longer used as money, its price in these large futures markets is carefully followed, allowing all global currencies and commodities to be instantly valued in grams or ounces of gold. Why would someone want to buy real gold or silver or other precious metals? There are two primary reasons. The first is that coins or bars of these metals have a durable, tangible and intrinsic value which derives from their future utility in industry as well as their perceived value as a financial instrument. Owners of precious metal coins or ingots may use them as a form of savings, but they sacrifice an interest on the savings, since such coins and ingots bear no interest. An important counterpoint to the loss of interest is that the asset value of each coin does not correspond to an obligation of another party which may be defaulted. The second reason to own precious metal coins is to have an asset which is private or anonymous. One man may choose to spend $100 on a dinner out, the other may choose to buy $100 worth of gold. The one man has spent his money, the other has saved it, privately. Although we live in a computerized world with ever less financial privacy, the owner of a precious metal is exercising a long tradition of financial privacy. An observation which justifies the ownership of precious metals as a form of savings is that over time, all printed monies of all nations tend to experience inflation. Prices rise slowly, and the purchasing power of the money falls slowly. Governments and their citizens tend to enjoy inflation at low levels since it allows them to pay long term debts back with inflated currency. A positive side of mild inflation is that it tends to encourage savers to place their money into interest bearing investments and assets such as homes and stocks, in the hopes that the value of their investments will grow faster than inflation. A corollary to that is that everyone knows that only a fool would stuff their money into a mattress for 20 years. But precious metals, over the long term, tend to generally hold their value just about even with inflation. There are occasionally periods where the value of precious metals does not rise with inflation, but those are usually followed by periods where the price of the precious metals rises, sometimes suddenly, and usually finds a new equilibrium price near the level dictated by inflation. For persons living in smaller countries where governments have a history of destroying the value of the currency, precious metals, primarily gold, represent an asset which can easily be sold but which will not suddenly lose value in a currency collapse. Even in modern times, families in many nations in economic trouble have been able to preserve their savings, through holding that savings in gold, rather than their local currency. Those families did not do this by suddenly converting their savings into gold during a financial collapse, they did this during the good times preceding the collapse, by slowly buying gold each time they had spare savings. Small countries who get into trouble with their national debt, and print up a lot of new money trying to fix things, and then see a dramatic collapse in the value of their currency, are usually able to let a bunch of folks go bankrupt, borrow a few billon dollars from the International Monetary Fund, print a new currency and start over. They are usually much more concerned about arranging bailout loans than they are about the option to confiscate gold or regulate or tax sales of gold. America is in a very different situation. We are already borrowing about $500 billion dollars per year from foreigners. This is about 5% of our entire economic activity (GDP). If America would get in trouble with the national debt, print up a lot of new money trying to fix things, and then see a consistent drop in the value of the currency, yes, many of us could go bankrupt, but who would bail us out??? If the dollar upon which we all have relied is losing value, the central banks of the world might prefer that Americans begin to save in other currencies such as Yen and Euros, but just as likely is that Americans begin to consider saving in gold. If this happens, the US Government and Federal Reserve Bank will certainly see that a rush away from dollars and into gold, by American citizens, is a vote of no confidence for the dollar. The temptation will be to restrict and regulate gold markets for Americans, trying to force them into holding dollars. But the real solution is for the Government to manage its spending and the FED to manage back real trust in the dollar. The situation in silver is even more dramatic. Near the end of World War II, since America had been a large silver producer, and had also accepted silver as payment for war supplies, the United States Treasury (including circulating coin) and the US Strategic Silver Reserve held close to 10 billion ounces of silver. Since then, silver has become an essential component in thousands of modern products, and even though the amount of silver mined each year has grown, the demand for silver has grown so much faster, that most of those 10 billion ounces of silver reserve have been used up. As a matter of fact, the ongoing availability of silver from reserves has tended to keep the prices for silver low, and so the global mining industry has not made large new investments related to silver. In essence, the world has been experiencing a shortage of silver for several decades, and this has been hidden by the consumption of reserves. Now, those reserves are gone. Silver known to exist in vaults is only about 150-500 million ounces 2% to 5% of the reserves we once had. Enough to cover a couple short years of typical silver deficit, but that is not enough time for the global mining industry to build mines to produce an extra 200 million ounces per year of silver. A shortage of silver is now eminent. Certain silver investors have recognized the emergency situation in silver several years ago. The situation with silver is that an acute shortage of silver (leading to certain industrial companies closing down production lines if they can't find silver) may now occur almost simultaneously with inflationary erosion in the value of various global currencies, particularly the dollar, and a trend away from financial investments such as stocks and bonds into commodities such as energy, food, lumber, metals, etc. In any financial environment, the rise in price caused by an acute and structural shortage in silver will attract new interest in silver investment, but this could even be more dramatic in a poor economic environment where inflation is once again high. Many of the world's poorest nations are still prolific savers. If even 1% of the savings generated in one year were to attempt to invest in silver, the price of silver would easily move to over $100/ounce. Historically, most serious investment advisors would advise owning about 10% of an investment portfolio in precious metals. If Americans now tried to convert even 1% of their portfolios into silver, massive increases in silver prices could occur.The great fear of this author, and of many investors who already own precious metals as a protection against a national or global financial emergency, is that once such an emergency unfolds, and many investors rush to the precious metals, it will be very easy to confuse cause and effect and try to blame the rush into precious metals as the cause of the financial emergency, when it is in effect only the symptom. As a matter of fact, since precious metals trade globally, allowing free markets in all precious metals, and therefore a true market price, is a perfect mechanism for measuring the true state of monetary affairs of each nation. Even after a global financial emergency, as governments reestablish well managed monies and do better at balancing their budgets, the prices of precious metals will once again fall back to a new equilibrium. Although it is predictable that governments in a crisis may attempt to take control of precious metals ownership and markets in their nation, and take control of precious metal mining properties, it should be remembered that the movement of small investors to own these metals in a time of crisis is a natural and very non-political human emotion. American politicians must recognize the importance of allowing all precious metals to trade freely, and perhaps build improved monetary systems by incorporation of precious metals back into bank reserves. But, above all, the right of all Americans must be adamantly defended, to choose honest and legal investments, and be rewarded if those investments are profitable. Attempts to outlaw or restrict the ownership or trade of precious metals is a fundamental violation of principles of economic freedom and justice, and one would be encouraged to carefully scrutinize the motives of individuals asking to implement such laws. Poor Old Solomon 968 (7/1/04; 07:40:05MT - usagold.com msg#: 122685) @All // BIS Some posters often (Belgian, Another, FOA) talk about the BIS. I've read about their mission and all on their website, but that's the official blabla. What do you know about this institution ? What kind of guy is Nout Wellink, the President of the BIS ? Does the BIS just trades gold,executes orders etc. for CB's, or does it owns Gold, does it trades for its own ? Is there al lot of political involvement ? Do they intervene in the markets under ECB-command ? Thanks in advance for your answers ! 968 (7/1/04; 07:22:13MT - usagold.com msg#: 122684) Nice quote a ran into... "There seems to be a correlation between the intensity of the official attacks on gold and the severity of monetary crises." HANS F. SENNHOLZ 968 (7/1/04; 06:28:21MT - usagold.com msg#: 122683) @Towncrier 25 points is nothing. Sir Alan just wants to get the maximum impact with a minimum input. You have seen the whole mediacircus the days (weeks) before the FOMC. This is a psychological move. Ned (7/1/04; 05:33:58MT - usagold.com msg#: 122682) Short story I was talking to an pre-elderly (65ish) man a year or so ago about silver. He owns a modern, tidy photo shop. The conversation began with me inquiring about the recycling of silver. His long story dazzled me immensely. A lot of silver was consumed for a long period of time. I had the impression that perhaps the late '50's thru to the mid-'90's. The amount of silver consumed has came off the cliff fairly significantly, again, by his story maybe 50%. It's still falling (digital) but it is beginning to level out. Surprises in the digital world should be farther and fewer between.He was an active trader of silver in futures markets in the '80's but because he was late to the party lost his shirt badly. He scowled and grimaced when he spoke of silver....I think there is a definite love/hate relationship there! He spoke more affectionately when he spoke of gold however. "You buy gold when TSHTF", he bellowed. "You should always have a little bit ...and you should have a lot just before TSHTF". So I asked him about TSHTF soon and his view of the world, politically.He said, "They are wheeling in one of those monster giant fans over to the middle-east right now. That thing will be turned on very soon. There's another one, but not as big, being wheeled up Wall Street too! It is so funny to see self-proclaimed big-shot bankers getting IT when TSHTF""So TS is going THTF?" I asked."Of course it is! There are so many fans this time that it will make your head spin. ""So how much gold do you have?" I asked, getting very nosy at this juncture."Well.......I'm somewhere in between a 'little bit' and 'a lot'."I left the store absolutely convinced that my long-term strategies were 100% correct. Slowly accumulating the REAL McCoy, the real thing is the only thing that can turn off a fan, even those big monster giant ones.Have a golden day!(I says we crack 400 again today, the last half-hour of trading yesterday saw many miners spike) Belgian (7/1/04; 03:57:52MT - usagold.com msg#: 122681) BIS !!! ALL MONETARY POLICIES WILL BE KEPT * NEUTRAL *...as neutral as possible. Means that the bank of banks (BIS) wishes to keep, IRs-exchange rates-goldpricing..., as flat as can be.Trichet (ECB) will most probably refer to this, in the afternoon.Conclusion : The US and EU economies are NOT reviving, despite many drastic measures. Inducing Hyper-inflation of confettis and prices remains the only solution. Herein lies the remaining major fundamental conflict between FED($) and ECB()-policies ! Currency-management and/or economic stimulation.Our conclusion should remain the same : Profit from the enduring obscene GOLDprice discounts and keep on accumulating for as long (as much) as you can...and understanding of Physical Gold permits.In the past 3 decades, we never had a similar situation as at present. And this from *all* standpoints. *Hope* that the good old, familiar days of before, will come back,...might cost one dearly. Black Blade (7/1/04; 00:32:01MT - usagold.com msg#: 122680) More seniors face financial need to return to work http://www.chron.com/cs/CDA/ssistory.mpl/business/2648799 Snippit:For many older Americans, retirement is not a financially viable option; many are going back into the work force. The trend is evident in the number of older workers, people 55 and above. Their numbers rose to 22.7 million in May, up from 22 million in 2003 and 20.7 million in 2002, according to the U.S. Bureau of Labor Statistics. The increase in older workers coincides with a shift in employers' attitudes at a time when the government is forecasting a significant labor shortage by the end of the decade.Black Blade: With rising inflation and Social Security being a cruel joke as COLAs do not keep up anywhere with "real" inflation, a severe lack of financial preparation, and pension plans in trouble, it's a no-brainer that many spend and never save seniors have no choice. TownCrier (7/1/04; 00:28:46MT - usagold.com msg#: 122679) Managing your money, and managing your wealth http://biz.yahoo.com/rf/040630/financial_moneymarket_1.html HEADLINE: Rising rates provide relief, finally, for saversNEW YORK, June 30 (Reuters) - Savers got some long-awaited relief when the Federal Reserve hiked short-term interest rates on Wednesday.The Fed's decision to raise its target overnight lending rate to 1.25 percent from 1 percent means yields on money market mutual funds, certificates of deposit and other bank accounts -- and rates on credit card and other consumer debt -- will rise....Investors shouldn't expect a quick return even to mid single-digit yields on cash investments. And money fund investors in particular should not seek out funds that take outsized risks to capture a bit more yield.Still, Crane said "we don't expect anything near the scale of the problems in 1994," when about 40 funds came close to breaking the buck as rates rose."Portfolio managers have stayed cautious primarily because of the Enrons and WorldComs of the world," he said. "No one wants his fund in the headlines for that."Consumers, meanwhile, should keep close tabs on what they pay on adjustable-rate home loans and credit cards, McBride said. Credit card rates are usually tied to the prime rate, which moves in lockstep with the Fed's overnight rate.As rates rise, McBride said, the biggest mistakes people make are "failing to lock in fixed rates while rates were low, and maintaining exposure to higher rates through their outstanding credit card and home equity debt."-----(from url)----To what extent does this 25 basis point hike in rates require gold to show a capital gain (rise in price) to keep up in the race?Due to this increased rate on cash account earnings, over the period of one year, gold (priced at $400) must now gain ONE whole dollar more than it previously needed to. Of course, your interest income is subject to taxation each year, whereas gold's capital gain taxation is a consideration only at such time as you decide to liquidate your holdings.Gold's climb thus far in the past few years from $250 to $400 has made the potential interest one might have earned on alternative cash savings at the going rates look completely anemic. It will require much more than this token rate hike to take the shine away from gold while its still priced at these absurdly low levels. (On the other hand, were gold to be currently priced at $4,000 per ounce, it would then have to gain a whopping TEN dollars extra over the period of a year to keep pace with this 25 basis pt higher cash rate. (YAWN) Enough to send gold owners into a fit of nervous shaking? Not likely.)R. Black Blade (7/1/04; 00:18:40MT - usagold.com msg#: 122678) Housing bubble is real, report says http://moneycentral.msn.com/content/invest/extra/P87483.asp?Printer Snippit: Bank predicts a 'hard landing' by mid-2005 and says prices are 'spectacularly and unrealistically high.' But the Fed remains unworried. Economists at HSBC on Friday waded into the debate over whether the U.S. housing market is overinflated, declaring a bubble exists, something the Federal Reserve has been reluctant to do. Black Blade: Of course. There's a glut of houses for sale and a building boom on top of that. Now with rising rates sales are sure to plummet hard and prices as well. A lot of real estate investors and consumer up to their necks in debt are going to take a bath so to speak. Black Blade (7/1/04; 00:04:59MT - usagold.com msg#: 122677) MYSTERY BEHIND LATE RELEASE OF PPI DATA http://www.nypost.com/business/26522.htm Snippit: The Labor Department's Bureau of Labor Statistics delayed release of the wholesale inflation number the PPI by half a week recently because, according to a press release, it needed to "resolve unexpected difficulties in calculating the index." A government agency doesn't produce a very important economic statistic on a timely basis and that's their best explanation? Keep in mind that billions of dollars are wagered each day on whether inflation is increasing or falling. And remember that the PPI is one of the most visible gauges of this watched all over the world. Not only is the number important to the Fed, but it's also key to the presidential election if only because it can change the economy by forcing financial markets to make borrowing costs more expensive. When the PPI was finally released it showed an increase of 0.8 percent in May, the biggest jump since March 2003. If you take out food and energy prices the increase was 0.3 percent. That the media didn't seem to care about this delay was as astounding as the government's ineptitude. So let me be one voice of indignation. Brian Catron, a BLS economist who works on the PPI data, says the number was delayed because "there was a calculation issue." What exactly does that mean? Does Catron mean that the PPI's jump, as originally calculated, was too large for the financial markets to handle? "You are implying that we are manipulating the number," Catron shot back when I asked. "I'm not going to dignify that with a response." OK, don't respond. I'm still wondering if that was the case. But here are some other things you might want to know. Catron assured me that the "mistake" that caused the PPI's delay had to do with the quality of the data that were provided by manufacturers. And he contended that Labor Department higher-ups had not seen the original number before it was pulled, so only lowly bureaucrats decided to rejigger the data. The raw data, Catron told me days before the PPI finally came out, didn't pass a quality assurance test. Prices as they stood on the day they were originally supposed to be released just weren't "appropriate" for public viewing. A little editing and they apparently become appropriate. Which makes me wonder: shouldn't someone be keeping an eye on the stat-amagicians? Black Blade: Oh oh - someone "peeked". Yep, Crudele hits the mark again! I have attacked the abusers of statistcics here many times before so I just leave you to view the article (see link). The BLS is nothing more than a government scam operation. 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.