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ARCHIVED DISCUSSION FROM 10/1/2006 All times are U.S. Mountain Time (Yesterday's Discussion.) a banker (10/1/06; 23:57:59MT - usagold.com msg#: 148011) Financial feet dance lightly When Mr. Powell asks that we consider what shape the dated 2002 words of Aristotle would have today, he misses the point.Financial feet dance lightly.In this post Mr. Aristotle provided more detail of ways and means than anyone has a right to suffer outside of the conference seminars on structured finance. Practicality and respect for the limitations and patience of his audience require the understanding that his lengthy exposition remains but a scratch upon the surface of the comprehensivie reality.I would have Mr. Powell curb his critique briefly to consider that the daily ways and means of the financial ballroom are not set rigid into concrete. The feet fly freely now this way and now that way as the new tune requires.Do not expect to see the musics of today served by the old footworks of 2002. It is a mistake to look for the words of Mr. Aristotle to have applicability beyond the intended scope. They serve only to give you one basic portal to see financial designs of fancy footwork for effects typical of the past two decades.But lately the euro-style MTM conductors are beginning to call the new tunes.The old dance now shuffles to new steps. Most visible among these is the ETFs to remain most closely in service of the old objectives of gold containment. Goldilox (10/1/06; 23:37:52MT - usagold.com msg#: 148010) Quotable http://www.prudentbear.com "Bulls of 1929 - like their 1990s counterparts - had their eyes glued on improving profits and stock valuations. Not a thought was given to the fact that the rising tide of money deluging the stock market came from financial leverage and not from savings. "- Dr. Kurt Richebacher Goldilox (10/1/06; 23:33:03MT - usagold.com msg#: 148009) Selective deleting is all academic http://www.prudentbear.com/randomwalk.asp snip:hanks to Jim Cramer it's easy to get a hot stock tip these days. There's no need to hang around barbershops, listen closely to a cab driver or get a shoe shine. And best of all, there is no need to visit your brother-in-law and risk having to listen to his poker stories in addition to his stock tips. No sir. All investors have to do is turn on the television after the market closes. And if they can survive Larry Kudlow's steady drumbeat of optimism, Mad Money will follow and Cramer will share his idea of the day in exchange for a booya. Cramer has an Official Trading Idea for every trading day of the week, not to mention off the cuff ideas that spring from conversations with callers with similar attention spans. Cramer is much more fun than reading the Value Line or slogging through a 10-k. Cramer's the kind of a guy you'd like to take for a cup of coffee, as long as he was having decaf. Last March some upstart academics tried to measure what had become known as the "Cramer effect," or the tendency of stocks to trade sharply higher after being mentioned on Mad Money. Three PhD students at Northwestern examined 246 of Cramer's recommendations, apparently, about six shows worth, and tallied up the results. According to a Financial Post summary of the findings, Cramer's stocks immediately jumped 2% on average, with the smallest stocks gapping 5% higher. However, according to Joseph Engelberg, one of the three authors of the study, gains typically reversed within several days, and on average, retreated to their original levels. If the numbers are accurate (which Cramer disputes in the Post story) that means the losers are those who buy on Cramer's recommendation, and the winners are the arbs and hedge funds who have figured out to make a buck from the Cramer effect.-GoldiloxNo different from the Internet shills of dot.com days. In fact, Cramer was even then one of the head cheer-leaders, using his street.com IPO as a lead in.I personally was part of the management team of a dot.com IPO that Cramer took from fairly unknown to $120 and back to $20 with his pump and dump. Goldilox (10/1/06; 22:32:08MT - usagold.com msg#: 148008) SDCEU Losses 24karat,Not only the UT and NC Times ignored the losses, but I sent the tip to all the local TeeVee outlets, who were equally unimpressed by the ramifications.My first tip came the Elliott Wave Newsletter (can't find it amongst my myriad emails), also mentioned by one of Puplava's editorialists. I do not have verifiable quantities, but the estimate was in the $Billions. mikal (10/1/06; 22:22:36MT - usagold.com msg#: 148007) Gold more than a "commodity" http://www.bloomberg.com/apps/news?pid=20601103&sid=aE5Q_Ga_OcOA&refer=us Oil, Gold Bottom on China-Led Rebound, US Trust, Goldman Say | Bloomberg | October 2, 2006After starting out on the subject of gold, copper and oil, it moves on to discuss commodities only.Still this is one of the largest and most informative news stories on commodities that's come out. Shermag (10/1/06; 22:08:29MT - usagold.com msg#: 148006) $$$ 636.4 $$$ "Who or what put gold to sleep?" I believe that several Western central banks were the instigators, attempting to thwart the heady rise in gold earlier this year, for the purpose of avoiding damage in their bullion banks. This goal was likely aided by banking industry insiders who understood what was afoot, and positioned accordingly, igniting a further round of shorting. Finally the mindless "black box" trading funds provided the final ingrediants for price decline."Who or what is going to wake it up?"Demand from Asian central banks, mideast oil wealthy, and India at large already provided an underpining, and will be there for the long haul. The dollar woes have only gotten worse over gold's recent "sleepy" period. 24karat (10/1/06; 22:02:17MT - usagold.com msg#: 148005) $$$$$631.0$$$$$ During its 5-year bull run gold has gone into hibernation during the summer months. We all know that it will wake up soon because little has changed since its ATH in May. Oil took a dip but we still have the twin deficits, a slew of bad news out of the ME and the dollar looking more and more like trouble to folks around the globe. One thing that is clear today, that maybe wasn't in May, is a housing bubble on its way to getting dismantled. IMO, this all looks favorable for gold and possibly other precious metals.Sir Goldilox - How did you find out about the SD county employees union losing a serious bundle in the Amaranth debacle? Consistent with what you said, the local fish-wrap (Union-Tribune) did not mention this. Any estimates on the losses? Mthirsty1 (10/1/06; 21:40:38MT - usagold.com msg#: 148004) Golden Lionheart I swear i did not read your post before i did my post.I new i had to just sit down and answer the question before time ran out.I must say however when i checked my post to make sure it went through alwright and saw your post,it made me feel pretty good.Sometimes i may actualy know what i am talking about.Good luck to everyone around the table round. Mthirsty1 (10/1/06; 21:23:13MT - usagold.com msg#: 148003) $$$$600.00$$$$ $$$$600$$$$ I think the reason gold went to sleep was because we all did the same thing.We had such a great run this year that we became complacent.We all sat back and watched gold go for a ride that it had not been on in a long time.And it has been wonderful.This run made alot of people stand up and take notice what a precious comodity gold is.As far as wakeing gold up,it's already happened as we have seen in the past few days.Supply and demand,plus people trying to make money.Have a nice day. Golden Lionheart (10/1/06; 21:16:26MT - usagold.com msg#: 148002) $$$$$$$ 603.80 $$$$$$$ Its quite simple, gold was put to sleep by you and I losing confidence in the uptrend.Gold will be awakened by you and I regaining confidence and buying gold. Goldilox (10/1/06; 21:12:01MT - usagold.com msg#: 148001) Hobbit Party @ Gandalf,The Hobbits are gonna "party hearty" with all those extra pennies and nickels!Better lock the wine cabinet! Gandalf the White (10/1/06; 20:59:11MT - usagold.com msg#: 148000) Thanks for the extra three cents Sir Contrarian <;-) (10/1/06; 19:47:48MT - usagold.com msg#: 147998) Gandalf the White (10/1/06; 20:57:11MT - usagold.com msg#: 147999) TAA TAA TAAAAAAAAAAAAA, TAA TAA TAAAAAAAAAAAAAAAAAAAAA ! $$$$$$$$$$$$$$ THE "PRICE of GOLD" GUESSING CONTEST!! $$$$$$$$$$$$OFFICIAL CONTEST ENTRY LISTINGS ----$$$ $8,752.0 $$$ The Invisible Hand (9/23/06; 14:30:09MT - usagold.com msg#: 147701)$$$$ $681.1 $$$$ Beamer (9/29/06; 01:14:22MT - usagold.com msg#: 147907)$$$$ $650.0 $$$$ Sundeck (9/22/06; 22:41:10MT - usagold.com msg#: 147683)### $643.0 ### Topaz (9/23/06; 04:57:44MT - usagold.com msg#: 147694)$$$$ $635.0 $$$$ Demosthenes (9/27/06; 21:18:04MT - usagold.com msg#: 147871)**** $634.0 **** jenika (9/28/06; 00:42:53MT - usagold.com msg#: 147878)$$$$ $633.3 $$$$ contrarian (10/1/06; 19:47:48MT - usagold.com msg#: 147998)$$$$ $626.3 $$$$ glockmaster19 (9/29/06; 13:22:18MT - usagold.com msg#: 147931)**** $626.2 **** Goldilox (9/23/06; 01:24:03MT - usagold.com msg#: 147686)$$$$ $620.0 $$$$ Clink! (9/22/06; 21:09:58MT - usagold.com msg#: 147681)$$$$ $615.0 $$$$ Armageddon (9/29/06; 22:17:10MT - usagold.com msg#: 147948)$$$$ $612.5 $$$$ Matthew (10/1/06; 13:16:33MT - usagold.com msg#: 147993)$$$$ $608.1 $$$$ Rocky (10/1/06; 12:08:43MT - usagold.com msg#: 147989)**** $607.3 $$$$ goldpuppy (10/1/06; 09:51:57MT - usagold.com msg#: 147982)*** FRN606.7 *** Smeagol (9/23/06; 01:57:50MT - usagold.com msg#: 147687)$$$$ $606.5 $$$$ balzac (9/27/06; 21:35:50MT - usagold.com msg#: 147873)$$$$ $605.0 $$$$ Titan (9/27/06; 12:30:56MT - usagold.com msg#: 147853)$$$$ $602.9 $$$$ GOLD FINGER (9/29/06; 18:01:04MT - usagold.com msg#: 147941)$$$$ $599.9 $$$$ DryWasher (9/24/06; 15:10:57MT - usagold.com msg#: 147742)$$$$ $595.5 $$$$ Federal_Reserves (9/25/06; 19:01:55MT - usagold.com msg#: 147777)**** $590.3 **** arbyh (9/26/06; 09:30:45MT - usagold.com msg#: 147809)$$$$ $590.1 $$$$ Flatliner (10/1/06; 12:11:52MT - usagold.com msg#: 147990)$$$$ $577.7 $$$$ Peculium Aurum (9/27/06; 23:55:29MT - usagold.com msg#: 147876)$$$$ $545.0 $$$$ Thoreauly (9/24/06; 10:22:14MT - usagold.com msg#: 147738)===Did you all see that the CONTEST ENTRY DEADLINE is near ?----- all entries must be posted to the TableRound before Midnight on Monday, October 2nd, AND ALL ENTRIES must answer THE QUESTION !!===TICK TOCK !!!<;-) contrarian (10/1/06; 19:47:48MT - usagold.com msg#: 147998) $$$$ $633.33 $$$$ Gold is the only entity that tells the truth of what is going on in the world today...although temporarily manipulated by ever diminishing charletans, its glory will shine though the tumultuous engineered events sure to come this October. GOLD FINGER (10/1/06; 19:01:24MT - usagold.com msg#: 147997) I LOVE BEING A GOLD BUG! http://articles.moneycentral.msn.com/Investing/ContrarianChronicles/BadDataWeakFedBuyGold.aspx Happy Day to All.....ETF heft Speaking of gold, I was pleasantly surprised to see two market developments: The gold ETF (StreetTracks Gold Trust (GLD, news, msgs)) took in more gold as prices plunged (with total ounces held now at a record).Although the silver ETF (the iShares Silver Trust (SLV, news, msgs)) saw its ounces drop a bit, they are now just shy of their previous high with silver $4 lower. What this points out: The un-leveraged "cash-type" buyers are availing themselves of dips in price to get more exposure. Meanwhile, the leveraged futures traders are being forced to sell weakness. I recently beefed up my metals' exposure and will now be at full strength as we head into the upcoming week's data.I think folks should keep that distinction in mind. Due to leverage, people who trade futures tend to chase strength and sell weakness, while cash buyers tend to do the opposite. That phenomenon is one reason why people who trade futures usually lose money.P.S. I actually placed an order here with out online host. Got sum MORE gold......:-)GF goldpuppy (10/1/06; 17:20:46MT - usagold.com msg#: 147996) ****607.30$$$$ Gold has been tied, kidnapped and chloroformed and now the effects are slowly wearing off. Soon gold will gain consciousness and will work out a way to escape the powers that be and helped by a few financial and political disasters on the way such as, a few hedge funds going belly up, more local wars and skirmishes, a few earthquakes and hurricanes and more fiat money sloshing around the globe. Smeagol (10/1/06; 15:18:02MT - usagold.com msg#: 147995) Like Thieves in the Night... ...are the ETFs, wethinks.Sss... if thiss is correct... current GLD holdings at 12,422,497.68 ounces... times expenses of 0.4 percent (annually?)... equals 49,690 ounces - over a TONNE AND A HALF of Precious evaporating in a year??? =8-0ETF shares = paper-money under your mattress.S. melda laure (10/1/06; 14:42:22MT - usagold.com msg#: 147994) Today's sermon parody... How beautiful upon the comex floor are the feet of him who brings big shorts! Who brings low prices to those owning paper, who announces short squeezings, who says to the suckers "y'all gone broke!" In plain sight they see their margin calls approaching. Break forth into singing you physical advocates, for the shorts have redeemed their paper, and the castle vaults are well stufft' with the good stuff. And all the ends of the earth will dial 1-800 869-5115 extension 103.With apologies to Isaiah...I do not think there is much need to disparage the ETF's, they are what they are. The expenses are well advertised, and the actual inventory is fairly clear. The one thing that remains is that the metal is not in your personal vault but in someone else's custody, and (being easily the largest private stockpile of silver) that makes it a big target in the event of a crisis where the host country suddenly "needs" a large pile of metal.That future risk is one that cannot be characterized. History shows that bank vaults can be locked up, and nationalized (raided) in extremis. Furthermore, paper markets can be shut down and "re-organized". For a mutual fund used to dealing in paper, and whose clients are also holders of paper, such an ETF is not a problem.For those of us who belive that the future may well involve closed markets and "new rules", such instruments are unsuitable. Gold in a vault is useless unless you own the vault, the building and the land. For a soverign nation, it is even necessary to own the jurisdiction, (as Iran discoverd to its detriment). Matthew (10/1/06; 13:16:33MT - usagold.com msg#: 147993) $$$$612.5$$$$ Ensuring the bullion banks were constantly short on gold by directly controlling the gold lease rate at a level well below the bank interest rate has resulted in massive downward pressure on the price of gold.Once this scam runs out of steam, and these banks "take the hit" and bail out of the contracts, the PoG will rocket. The same banks will then be chasing it up. Its a case of who blinks first. Goldilox (10/1/06; 12:39:59MT - usagold.com msg#: 147992) Cheap Oil? @ Rocky,"Gold is napping due to what is called cheap oil"Just like gasoline, the run up from $10 to $70 oil somehow makes $60 oil look "cheap", and OPEC has arleady made moves to defend this "line in the sand," so to speak.Perception is such a wonderful thing for the spinsters! mikal (10/1/06; 12:19:49MT - usagold.com msg#: 147991) Speaking of paper... http://www.freemarketnews.com/WorldNews.asp?nid=22476 [Repost]PUTS FORECAST OCT. SURPRISE?Sunday, October 01, 2006 - FreeMarketNews.comINITIAL POST 09.30.06A faithful reader and commentator, "A. Magnus" writes has written the following email, posted to FMNN General Feedback:"Do you like October suprises? Is there a big bang coming to hit the markets? If you believe that those in the know use insider information before major events then you might be interested on the HUGE number of October 6th put options for the big indexes. Check out the concentrated puts on the Diamonds DOW Trust (DIA):https://fastquote.fidelity.com/webxpress/ia_optionchain_frameset.phtml?priced=Y&SID_VALUE_ID=DIADitto for the S&P Depository Receipts (SPY):https://fastquote.fidelity.com/webxpress/ia_optionchain_frameset.phtml?priced=Y&SID_VALUE_ID=SPYAnd the NASDAQ (QQQQ):https://fastquote.fidelity.com/webxpress/ia_optionchain_frameset.phtml?priced=Y&SID_VALUE_ID=QQQQEven the Market Vectors Gold Miners has significant puts for October 6th:https://fastquote.fidelity.com/webxpress/ia_optionchain_frameset.phtml?priced=Y&SID_VALUE_ID=GDXMake no mistake - something wicked this way comes, and the smart money has already taken preventative steps." Flatliner (10/1/06; 12:11:52MT - usagold.com msg#: 147990) $$$$ $590.1 $$$$ It is hard to see gold sleeping, but changes in the rules are known to cause panicked liquidations from the week handed. Loses, in investments, stir heads away, turning the sentiment grey in the media for all to see. On sunny days, it is harder to see the rainy days coming because of the distraction of the picnic.But this will all change. The carefree days of summer will be replaced by another realization that tomorrow's income will not buy what it does today. Tomorrow, I will need three jobs to provide the same buying power that my two provide today. Those of great thought will once again see that today's path is truly the same as yesterdays and the many days that preceded it. That confidence will make their hands strong. Gold they will continue to hold. Gold has functioned and will continue to function while the other opportunities wither on the vine fed by the dirty water of inflation.Gold is awake and alive in the hearts and souls of many. We all stand witness as we see those that have completely believed in paper question its management and find strength in gold. Gold, when priced only in debt dollars and cents, is treated with limited respect in the grand scheme of things. Rocky (10/1/06; 12:08:43MT - usagold.com msg#: 147989) $$$$608.1$$$$ Gold is napping due to what is called cheap oil, Bernanke's willingness to play the Fed until election time, and the supposed slowdown in world economic growth. The next middle-east skirmish will drive the price of oil up, and so will gold rise. Smeagol (10/1/06; 12:02:02MT - usagold.com msg#: 147988) All you need to know about 'goldish' and 'silverish' ETFs, precious http://etf.seekingalpha.com/article/9750 ...sss... in our opinion, anyways...Snip:"With all the hoopla about the introduction of the iShares Silver ETF (SLV), investors seem to have forgotten a big gaping flaw in the design of all the metal ETFs.None of the metal ETFs own any income producing assets. Metal itself is dead, and therefore fund expenses -- 0.40% for (GLD) or (IAU), 0.50% for (SLV) -- are taken from the ETF's bullion holdings. Every day the amount of gold or silver backing an ETF share shrinks. As the silver ETF's Prospectus helpfully explains: The trust sells silver to raise the funds needed for the payment of the sponsor's fee [...] and all trust expenses or liabilities not assumed by the sponsor. The purchase price received as consideration for such sales is the trust's sole source of funds to cover its liabilities.For example, on Jan 03 2006, each share of streetTRACKS Gold Trust (GLD) held 99.552% of 0.1 troy ounces of gold. Today on April 27 2006, each share of GLD holds 99.433% of 0.1 troy ounces of gold. On GLD's inception date November 18th 2004, each share held 100.00% of its starting NAV. You can watch your GLD vanish on the official streetTRACKS website.An commodities fund like DB Commodity Index Tracking Fund (DBC) or United States Oil Fund LP (USO) that uses futures does not have this problem because interest from the bonds deposited as margin for future contracts is used to pay fund expenses and offset losses due to contango."S. Gandalf the White (10/1/06; 11:05:19MT - usagold.com msg#: 147986) THANKS, Sir Goldpuppy ----- BUT ----- goldpuppy (10/1/06; 09:51:57MT - usagold.com msg#: 147982)==You still owe me over TWENTY works of Answer !<;-) R Powell (10/1/06; 10:52:24MT - usagold.com msg#: 147985) Knallgold Refering to ETFs you said... "I'm wondering why still anyone would want to buy such derivative schemes-keep in mind this is particularly about Gold.One pre-set to accept before reading: the ultimative Goal of the game is: who has the most Gold in the end? Because he who has it makes the rules" I can share that sentiment. Perhaps these ETFs are exactly what they claim to be...a means or vehicle for stock investors (who typically do not have access to futures) to invest in commodities. These ETFs trade as stocks and mutual fund managers can buy them. Mutual fund managers do not want any physical anything...gold, oil, BTUs etc.... they simply want to invest capital. The ETF's collect their fees along the way. Thoreauly (10/1/06; 10:42:54MT - usagold.com msg#: 147984) @ Sundeck #147940 http://www.shadowstats.com/cgi-bin/sgs? My understanding is that the correlation between the NAHB Index and the SPX is strengthening, given how massively housing now affects consumption and how massively consumption in turn affects GDP. Furthermore, in putting the question to economist John Williams at ShadowStat.com (see link) about the housing collapse prompting the Fed to slash rates to the bone and print money out the wahzoo, leading to the collapse of the dollar, followed by a collapse of the bond market (as foreign central banks begin sell off their massive holdings of US bonds) and thus a hyperinflationary depression, here's what he said:"Your scenario is quite plausable as to how the hyperinflationary depression could break. Key will be foreign dumping of the dollar and the extraordinarily massive liquefaction the Fed will provide in an attempt to keep the U.S. markets afloat."Notice that he said THE hyperinflationary depression, i.e., it's not a matter of WHETHER it will happen but WHAT, exactly, will trigger it and WHEN. The WHAT aside, I firmly believe that the WHEN will be sometime in 2007 or 2008.In Gold We Trust. R Powell (10/1/06; 10:17:19MT - usagold.com msg#: 147983) Knallgold // papergames Knallgold, I understand that you and many here fully believe that the POG is 100% manipulated by evil, powerful money players (bankers and NWO fiat backers, etc.) whose intent is to profit from their alleged market control or defend the fiat monetary system. Imho there is a modicum, but only that, of truth in this, but mostly on a very short time frame. Please note that I started that last sentence with "Imho". It's just that...an opinion. Assuming that there is an evil, all powerful cabal controling the POG..with the intent to keep gold prices low...how have they been doing these last few years? As for derivatives, they are simply monetary investments whose lose or gain is "derived" from the price movement of the underlying stock, commodity, price of tea in China, or whatever. Almost all are settled with cash. Delivery is almost a non occurance for the majority in the game, especially in the metals markets (as compared with foodstuffs) and has no direct bearing on the workings of the market. I did NOT say no direct bearing on prices...but on the workings of the markets. While reading that post from Aristotle from years ago I wondered how the position he described would have fared over time. Or, to make it simple, how have the paper shorts done as the POG moved up from the $300/ounce level? I fear Ari would have had to take a beating on those shorts OR actually deliver his physical to cover them. Simultaneously buying physical while shorting the same amount on paper is a simple no-win...no-lose hedge. Notice the SAME AMOUNT there. Was Ari's position hedged in equal amounts? What was the end result? You figure it out! He also stated..... "These poor clowns are knocked off their feet by their own successful leverage. As we say, the victory was theirs, but their hands were too small to hold it. Quickly they find it's one thing to pay a $1,350 margin to hold a "right" to buy 100 ounces, and it's quite another thing to pony up the full purchase price ($32,000+) for each contract when the chips are down and the grown men at the table aren't blinking." Now then, let me state some FACTS (not opinions) and you can check if you've a mind to, that each + every Comex contract has an expiration date, and after that delivery dates. Anyone holding a contract...either long or short...MUST...MUST...offset or close that position by expiration date OR take the risk of "being assigned" which means actually having to purchase or deliver the physical. Soon thereafter ALL open positions for that expired time period are matched up and delivery/pickup schedules + locations are set. Futures and options are bought + sold through brokerages. brokers will NOT let anyone be assigned to deliver or take delivery without having sufficient funds. Why? Because they'll get into BIGTIME trouble if they do. However, anyone can close (offset) any position(s) at any time prior to the expiration date. This again is not opinion, it is a fact. Those who can not deliver on shorts OR those who, as Ari mentioned, do not have the funds required to accept (PAY) for delivery MUST...MUST..offset or close their positions by the expiration date. End result...those "poor clowns" using leverage who can not pony up the additional fund OR do not want delivery..HAD to and were force to get out by expiation. So they sold for more what they had bought for cheaper...making a paper (dollars + cents) monetary profit. This is exactly what they intended! Were they cheated out of their physical gold? No, assuming as Ari says they do not sufficent funds, then they never intended to buy physical from the exchange warehouses. Does a share of General Motors stock imply the intent to take physical possession of part of GM's holdings? Have they lost their leverage to the PRICE of gold. Yes, if they simply close, but they can close the expiring month's contract and, if they are so inclined, simply buy the next or any of the following months. This, I believe, is what ANOO intended to do, or so he claimed...simply "roll over" the position as expiration approached. Nicely done ANOO. Congrats on your profits! Futures + options on the same are almost 100% a monetary game. Very few contracts are NOT offset in comparison to the outstanding open interest. Physical gold in hand is physical possession of gold. Why must there be such confusion? And, for the record, I hold physical metal (silver) and personally I highly recommend doing such. I bought mine through our host and highly recommend their professional service. And, as Aristotle, I do not find anything unusual about holding physical metal AND playing in the paper casino..whether stocks, futures or options. Why do I find myself scorned or ridiculed for such? For those of you who hold Knallgold's view that the futures markets exist mainly to "control or manipulate" prices...then let me state that I'm usually (on net) long the metals. Doesn't this place me as one fighting against the shorts? I don't see it this way, but wouldn't you if you subscribe to the total manipulation theory? And finally, I do miss sparing with Aristotle. It would be nice just to know that he or she is still with us and in good health. happy weekend to all.....! goldpuppy (10/1/06; 09:51:57MT - usagold.com msg#: 147982) $$$$$$607.30$$$$$$ $$$$607.30$$$$ Gold chloroformed and effects are now wearing off. Knallgold (10/1/06; 03:39:46MT - usagold.com msg#: 147981) Papergames As the ETF's come up again,I think it is worth reposting one of Ari's gems which served to me as a big eye-opener on the paper machinations.Yeah I had to re-read it several times and making figures to get it (english not my mother language either).I presented it then to my father which had also interest in it.You should have seen his eyes...I'm wondering why still anyone would want to buy such derivative schemes-keep in mind this is particularly about Gold.One pre-set to accept before reading: the ultimative Goal of the game is: who has the most Gold in the end? Because he who has it makes the rules."Aristotle (10/17/02; 02:29:28MT - usagold.com msg#: 87615)R Powell's msg#: 87573, thank you! = = = Plus... an EXTRA SPECIAL note for Gold investors everywhere = = =RP, Do you realize you're effectively echoing the initial point that I raised, that Pizz concurred with, and that Sierra drove home?In case you've lost track, it was Kasperjack who appears to insist there IS solid Gold backing (deliverables????) behind this StanBan *product* we've been discussing. Rather than taking the high ground and demonstrating where WE have all erred (as doubtful as that is,) he's instead demanding that WE prove the absence, the ABSENCE(!) of such and such when no indication exists to suggest there would be any substance involved in the first place. So that's where that rests, and I'll leave it there.Next, regarding that following post of yours. Please get out of your head once and for all your persistent and misguided notion that I "endorse physical Gold to the exclusion of everything else." It's absolutely not true and I'm vexed by the quack characterization it implies. I'm a proponent of many real things (Gold, sandwiches and patio furniture to name a few) and I heartily endorse entrepreneurial efforts and any other eyes-wide-open stock or bond investments. My lasting frustration, however, is with the widespread failure of the many promoters and participants in the wide Gold market to reach FULL DISCLOSURE on what's actually "good as Gold" (uhhhh... that would be GOLD, sir, and NOTHING else) and what's merely "Goldish... sorta... and only during good times."But hey, let's drive my point home to bed. I've got no problem if Standard Bank wants to offer, and you or anyone else wants to invest in, a £10,000 financial product that pays 2% per annum with a 10% kicker if the price of tea in Shanghai (or pint of ale in London) goes up by 27%. I see nothing terribly objectionable with that.Are we crystal clear on this, R Powell?= = = = Moving right along to the main point = = = =Let's step through the looking glass now, shall we?Hold on to your hats and maybe take a Valium or two. If you're willing to follow along this is gonna be a helluva thing.....You know..... it occurs to me, seeing how EASILY some Gold-minded investors may be drawn in by leverage and by less than the Real Thing, I, too, stand ready to accept £10,000 ($15,500) investments for over-the-counter 12-month maturity structured financial products offering a Goldish hue. Let's call them Ari-Instruments.On those Ari-Instruments I'll pay 2% per annum for use of the money, and throwing caution to the wind (but mostly to make my point) just like Standard Bank I'll promise a (maximum measly) 10% interest payment kicker to the bearer upon the event of Gold's price increasing by at least 27% to $400.Primarily to ensure the ever skeptical R Powell that everything is right in the world, I imagine I'll hedge my cash exposure to that price-rise event in the following manner: For every FIVE Ari-Instruments I've sold (for which I'll have received $77,500) I'll take up a SINGLE long position through the COMEX Gold futures market.Are you following me so far? That means I'll deposit $1,350 in margin and if Gold's price increases by $85 during the year I'll cash it out for the leveraged payoff at 100-to-1 ($8,500) from which I can easily pay off the 10 percent interest "Gold-price kicker" on the five Ari-Instruments -- that is, $1,550 each totaling just $7,750 for all five.In the meanwhile, God only knows what StanBan in my place would do with the balance of the $77,500 (minus the $1,350 margin deposit) received for the five Ari-Instruments for the course of the year, but they sure wouldn't have to do anything else with it even remotely connected with Gold.But this is what "I'd" do with the cash.Come follow along. It might prove to be an eye-opener on the nature of the world, especially for folks like Kasperjack who've said I'm full of hot air without any relevance to the real world.Following that single long, I'd take out TWO additional gold futures positions through COMEX, but unlike the first one, these would both be SHORT. The margin would be $2,700. Then, I'd use about $65,000 of the remaining cash to buy 200 ounces of Gold for delivery to my doorstep.Are you still with me? As more and more chumps (I mean investors) sign up for my Ari-Instruments and flood me with their cash, I'll always be taking TWO SHORT positions on COMEX for every ONE LONG (plus 200 ounces of Gold delivered to my door) all financed with their money. I assure you, all of my sharpest friends will join in this routine, and thus the price discovery mechanism provided by COMEX will be more inclined to fall than to rise.As this continues for year after year, I never have to pay the 10% kicker to my investors, needing instead only to pay the paltry 2% which is peanuts when drawn from the broader spectrum of my other banking, finance, and derivative operations. Or how about this? I'll make interest payements with the leftover Ari-Instrument cash that didn't get used for purchases of the fixed ratio of three contract margins (one long, two short) and the 200 ounces of Gold per each five Ari-Instruments which were sold to these poor chumps.Now get this... here's a beautiful thing. With the downward price pressure, as my long futures contracts suffer losses, it's easy to close them out painlessly using (only) half of my outstanding short contracts as offsets!Furthermore, as opportunities in the falling market might allow, some of the remaining short positions can be further liquidated (cashed out) through COMEX as a form of compensation -- thus effectively ensuring that the net out-of-pocket expense for the physical Gold I bought and held is always cheaper than the market rate I paid at the time of the order. Think hard on that one and join me in a well-earned smile!And you wanna know what the REALLY beautiful thing is? For this I want everyone to wake up who's been for years predicating their own leveraged paper Gold longs on predictions about **eventually** there being a massive squeeze on the shorts like me. It ain't gonna happen dudes! If you've been carefully keeping score, you'd see that through this process I've got a physical position that is ounce-for-ounce at least double my net short position.IF (and that's a big if) there's an unlikely event in which me and my bullion banking buddies can't contain the COMEX price with our two-for-one selling, then we simply announce delivery intentions for a token amount -- that's just a *TOKEN AMOUNT* mind you -- of our physical Gold through the exchange to stand against our short positions.Wanna know what happens next?You guessed it! We just sit back laughing at the poor stoppers as these same over-leveraged longs fall all over themselves in their scramble to resell it -- right back to us!! Here's the thing... the thing being that their contracts represented more Gold than they ever had any rightful business or financial ability trying to "control" (and I'm NOT sorry if I'm so bold as to use the one key word always present in the honey-dripping sales pitches of their own commodities brokers.)These poor clowns are knocked off their feet by their own successful leverage. As we say, the victory was theirs, but their hands were too small to hold it. Quickly they find it's one thing to pay a $1,350 margin to hold a "right" to buy 100 ounces, and it's quite another thing to pony up the full purchase price ($32,000+) for each contract when the chips are down and the grown men at the table aren't blinking. So you see, as fast as they're selling what they can't afford, we're one step behind them with very strong hands. Once again our token bit of Gold brought about the desired turnaround and business continues as before. Again, if you wish to a Gold accumulator at the best prices, think about this process and join me in a well-earned smile.The Moonshot, the Worst-Case Scenario for my crew would be in the end game where the currency world comes undone and the flood of hyperinflated dollar spending washes over everything with sprees of buying anything and everything tangible in the flight from dollars.In that case business as usual ceases to be, and conceivably we'd need to deliver up to nearly HALF of our physical Gold holdings to protect ourselves from nominal (bookkeeping) cash losses through the Exchange on our remaining open positions of short contracts.The prospect of that being very traumatic to us is much diminished, however, given the nature of the product. In times of volatility there are trading/price limits that kick in, and the COMEX Gold exchange stands better than a good chance of its contracts being locked in "fantasy land pricing" while the prices on the physical market run away in round-the-world Gold rush trading. At least a few frustrated COMEX longs will be looking to liquidate the paper junk ASAP and take their cash where the Real action is.Whether the exchange in Gold derivatives survives or not, the upside is we keep at least half the Gold to ourselves -- my partners and me -- all of which was purchased with other people's money through the Goldish-colored Ari-Instruments. The final small bite for me out of the worst-case-scenario is that we (my crew) would have to sell a wee bit of these Gold holdings on the soaring physical market if, in fact, our previously mentioned long contracts fail to pay out via the Exchange (due to COMEX lockdown) in order for us to cover our measly 10% interest rate kicker due to the $400-Gold-price knock-in as promised in the original terms of the Ari-Instruments. And yes, perhaps we've gotta liquidate just a little more of our remaining Gold at these glorious moonshot prices -- on an as needed basis -- as frustrated owners of the Ari-Instruments reach their 12-month cycle maturity and want to cash out their original principle (£10,000 or $15,500) on these Goldish yet quite impotent paper posers that we designed for them.Are you a physical Gold Advocate through and through? Then smile with me a well-earned smile as you continue to buy your physical Gold at prices that others have worked so carefully for so long to bring so low for massive acquisition before the Free Gold moonshot.If, having joined me in my office for the day, you still insist there is metallic virility in Goldish paper investments, then Heaven help you because my crew, my partners and me, we'll take you up on it. We'll work you up and roll you over, maybe make you wiser but none the richer. So please... feel free to pull up a chair and have a cigar, your head filled with promises even as we rape you."Golly, Ari, you've changed!"No, I don't feel that I have. I'm still trying to help you, to wake you up. (It's the falling piano thing -- "Get the hell outta the way!") That, plus I don't want you to be a welfare case while I'm trying to live large after the dollar goes Bolivian. (The quickest road to revolution and communism is a penniless population. I WANT you to have Gold so you won't take mine. There, see? Turns out I'm not so noble after all. I'm just as selfish as the next guy.)I just figured where attempts at friendship and various flower-filled analogies have continued to FAIL to impress upon some of you the stakes of the game, I thought perhaps a little swim, up close and personal-like, with the sharks might convince you that the blood in the water will be your own unless you heed my words.It's just tough love, my friend, tough love. And self interest.Here endeth the "insider view," thus endeth the lesson.Real Gold. Right now. (What time do you think you have???) Get you some. --- Aristotle " The Invisible Hand (10/1/06; 01:04:27MT - usagold.com msg#: 147980) UK must severe its links with the US of A http://observer.guardian.co.uk/world/story/0,,1884879,00.html WORLD WAR THREEPIPELINES THROUGH AFGHANISTAN AND PAKISTANWHITE HOUSE IN CRISIS OVER 'IRAQ LIES' CLAIMS Watergate journalist's new book exposes how Bush has kept the US public in the dark about the true costs of the 'war on terror' Paul Harris in New YorkSunday October 1, 2006The Observer SNIPPresident George Bush was braced for one of the toughest fights of his political life yesterday as a fierce row broke out over whether he has been misleading the American public over the worsening violence in Iraq. The crisis also rippled across the Atlantic with claims that THE ADMINISTRATION HID CRUCIAL IRAQ INTELLIGENCE FROM ITS BRITISH ALLIES.= It is of the utmost importance that the EU disconnects itself from the US of A dominance. Failing to do so would result in the EU being dragged by the US of A into WW III.Yes, this is easier said than done.The only answer of the European politicians is to borrow the German vision and argue that the EU and US HAVE to further build a free-trade zone.This is complete nonsense as the US of A only does that which is the best for itself at the expense of everybody else.This situation lasts already for 60 years. As a result of two world wars, Europe has lost all its power to the US of A.Europe must now try to free itself from the US of A shackles by autonomously determining its policies.This being rendered even more difficult by the fact that the UK of GB and NI is not willing, able nor allowed to severe its links with the US of A. Afghanistan: Why NATO cannot win http://www.atimes.com/atimes/South_Asia/HI30Df01.htmlTurkmenistan and contiguous Uzbekistan are both above Afghanistan and Pakistan. And that's where the world's fourth largest gas supply is located. This gas has to reach the Arabian Sea through pipelines through Afghanistan and Pakistan.NATO must open this territory in order to counter the oil/gas monopoly which is in the process of formation . Failing to do so would give the new GLOBAL energy cartel (and its pricing) too much power over the NATO countries Starting from local conflicts, this global war on oil/gas runs the risk of leading to WW III. Gandalf the White (10/1/06; 00:15:21MT - usagold.com msg#: 147979) Did you all see that the CONTEST ENTRY DEADLINE is near ? ----- all entries must be posted to the TableRound before Midnight on Monday, October 2nd, AND ALL ENTRIES must answer THE QUESTION !!===TICK TOCK !!! Gandalf the White (10/1/06; 00:12:41MT - usagold.com msg#: 147977) TAA TAA TAAAAAAAAAAAAA, TAA TAA TAAAAAAAAAAAAAAAAAAAAA ! $$$$$$$$$$$$$$ A "PRICE of GOLD" GUESSING CONTEST!! $$$$$$$$$$$$We shall have a price guessing contest on the closing (Settlement price) of gold for the December COMEX contract (GCZ6) on Thursday, October 5, 2006, ---BUT all entries must be posted to the TableRound before Midnight on Monday, October 2nd, AND ALL ENTRIES must answer THE QUESTION !!The POG Contest winner -- the closest price guess to the actual Settlement Price -- will receive a "Dutch Treat" -- No, No, No ! I mean one of these four different types of The Netherlands 10 Guilders gold coinage. IT (<== See that Sir Smeagol ?) could be a: "King Willem", (Minted 1875 - 1889, Fineness: 0.900 and Actual Gold Content: 0.1947 troy ounce; or a "Young Queen Wilhelmina" (Minted 1892 - 1897, Fineness: 0.900 and Actual Gold Content: 0.1947 troy ounce); or a "Queen Wilhemina", (Minted 1911 - 1917. Fineness: 0.900 and Actual Gold Content: 0.1947 troy ounce); or an "Elder Queen Wilhelmina", Minted 1925 - 1933, Fineness: 0.900 and Actual Gold Content: 0.1947 troy ounce) !!!! IT just depends which one SIR MK finds first when he goes down into the dungeon. <;-)Please go to the USAGOLD link at: http://www.usagold.com/gold-coins.html to view these coins.There will be also be two runners-up prizes for the next closest prognostications --- each winning an one ounce pure Silver Canadian Maple Leaf coin. ( <=== See that Sir Rich ?)The QUESTION -- (Put on your THINKING HATS !) -- is: "Who or what put gold to sleep, and who or what is going to wake it up?"Answers should be in 30 words or more.===THE RULES -- (We MUST have RULES !!) --- PLEASE READ !!1) The Winner is the poster with the Price Guess closest to the Settlement price of the COMEX (most active) December 2006 Gold Contract (GCZ6) on the date of Thursday, October 5th, 2006. 2) Price "Guesses" shall be stated in Dollars and tenths !(Such as $ 666.6) 3) "Guesses" shall be SHOWN in the SUBJECT BOX location AND enclosed in markers of "Dollar Signs" so as to be OFFICIAL !(Such as $$$$$ $ 666.6 $$$$$$$ )4) ONLY one "Guess" per Knight or Lady is allowed, and once that "Guess" has been "taken" -- no one can duplicate it !! FIRST COME has rights to that "Guess".5) HOWEVER, All "Guesses" MUST be posted before the clock in Denver strikes MIDNIGHT (24:00) on Monday, October 2nd, 2006.6) AND MOST IMPORTANTLY (as this part MUST accompany your Price prognostication)--- In order for your entry to be valid, YOU will need to answer "THE QUESTION", in 30 words or more.---LET the CONTEST continue !!<;-) ViewYesterday's Discussion.
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