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ARCHIVED DISCUSSION FROM 12/13/1999
All times are U.S. Mountain Time

View Yesterday's Discussion.

elevator guy (12/13/99; 23:48:16MDT - Msg ID:20988)
ATM strategy
My personal plan for ATM withdrawls is to take out $20 at a time until the whole $100 is gone, that way, I will avoid detection by the CIA.

In case you didn't get it, this is supposed to be sort of a comic relief from the crud that has been appearing here lately.

Good night.

TEX (12/13/99; 23:41:03MDT - Msg ID:20987)
THX 1138
Your ATM story sounds familiar. I have been keeping an eye on the banks and slowly drawing down on my savings via ATM withdrawals. I used to be able to remove $500 a pop with no limits on the number of times I wanted to withdraw in a 24 hour time frame (lots of $20's to deal with). Since the first of this month, the bank has place a one time withdrawal limit of $500 per 24 hours. My inquiry to the bank discovered some additional information that my debit card now has a limit onthe number of times I can use it for purchases on a daily basis. When I pointed out that this was not in my original agreement, the employee stated that yes, this was a recent change in policy. Luckly, my slow approach to withdrawals is almost complete.

TEX (12/13/99; 23:20:03MDT - Msg ID:20986)
AEL re: Christine
For the time being, I'll take back my original post reagrding Christine. You are right, we do need a court jester.....as long as he/she keeps the post short, sweet and to the point.

Strad Master (12/13/99; 23:12:31MDT - Msg ID:20985)
FOA and the Strad auction.
As probably the only one on this forum who is truly "Strad rich" I especially appreciated your use of the Strad auction as an analogy. To go a step further, no one at that auction is likely to see that particular Strad up for sale again anytime soon. If for some reason one of the bidders there wanted that certain instrument and lost the bidding, they are just out of luck. Now, there are roughly 600 Strads extant in the world today (not all are great instruments or in fine shape) and proportionately a smaller number of interested buyers. Gold is also a finite substance and given the vastly larger number of inerested purchasers, physical could become quite scarce, indeed.
Anyhow, I suspect you were thinking of me when you came up with the scanario. Glad to be of service. (:-))

PH in LA (12/13/99; 22:58:37MDT - Msg ID:20984)
Stradivarius, Stock Market Paper and retirement planning

"...keeping their money in the markets. The irony here is that most would not even consider going to the strad auction - they feel that they have to keep their money working so that it will be there for them in their 90's..." GFD (Auctions Msg ID:20968)

GFD:
How well FOA knows the world when he chooses Stradivarius violins as his proxy for "real things" which one assumes includes gold. Those who know anything about rare Italian violins and French violin bows know that they have never decreased in value. Anyone owning a Strad can rest assured that it will retain every last measure of its value when the time for retirement and/or cashing in of the investment comes. Even more-so than gold (which has suffered from too much "management for the good of all"), money invested in rare works of art has no need to be invested in stock markets or anywhere else. Of course, it always helps to actually "own" the article outright rather than paying interest on borrowed money... even as FOA and Another council with regards to physical gold versus leveraged "plays" in paper/derivitives/futures/etc.

Gandalf the White (12/13/99; 22:43:15MDT - Msg ID:20983)
GDF
YES --- I fully agree and I have been totally unsuccessful in nudging any of my extended family and only a few friends toward the "correct path". - Sometimes it makes me want to cry!! Bullheadedness must be a family attribute (or curse).
<;-)

GFD (12/13/99; 22:17:11MDT - Msg ID:20982)
Auctions
Peter Asher, Gandalf the White, your points are well taken.

The whole thing about FOA's was that it was written from the point of view of someone who would even *consider* buying something with their 'hard earned money'. Compound this with the fact that many of these people have made quite a lot more money in recent years will simply reinforce the tendency to leave their money in the (paper) markets.

This is a very powerful mindset. I doubt it will change until something massive occurs. Unfortunately it will be too late. Furthermore this mindset reinforces itself with more funds chasing fewer stocks each quarter.

Black Blade (12/13/99; 22:01:30MDT - Msg ID:20981)
Shrre Lapointe and Madison Enterprises LTD
The people involved are also the same who were responsible for Eskay Creek. They have an excellent background and Orca gave a fair description of Mt. Kare. I have had this project in my scopes for the last couple of years. This is certainly one of the more promising of the Juniors.

Peter Asher (12/13/99; 21:53:30MDT - Msg ID:20980)
Gidsek
Did you miss >>>(12/12/99; 21:52:55MDT - Msg ID:20858) <<<
last night?

Peter Asher (12/13/99; 21:46:21MDT - Msg ID:20979)
Oil
Was e-mailing this to one of the brood and saw it was relevent to all. >>> Was on the phone today with a fellow who just got back from Saudi. He verified the 10,000 chip
story. He also said that beneath the surface, the OPEC agreement is tenuous because they totally
distrust each other, hate each other etc. He also thinks that an OPEC nation can be pressured into
breaking their quota by a customer (Foriegn Aid ?)country and than the rest will follow. Of
course if the well-heads or pipes are down, that's all moot.

THX-1138 (12/13/99; 21:45:02MDT - Msg ID:20978)
Re: Peter Asher
I didn't want to screw around with the ATM at that time, So I put in a number that I new would work ($100). I have been able to in the past get $50 from the machine. Pretty sad if all the cash they have in the machine is in $20. I try and spend them as fast as possible to get lower denominations. Stick some other sucker with the new monopoly money that currently is unusable in some vending machines.

Black Blade (12/13/99; 21:43:44MDT - Msg ID:20977)
Peter, el st. one, PH in LA, et al.
Concerning a particular poster on this forum. I've seen similar delusional thought processes before. It is commonly associated with acute schizophrenia.

TownCrier (12/13/99; 21:26:13MDT - Msg ID:20976)
The GOLDEN VIEW from The Tower
It may seem that a disturbing or inappropriate level of official sector gold sales have been in the works if we are expected to take the Washington Agreement at face value. England is currently engaged in an extended gold auction program. The Swiss are removing legislative barriers to facilitate the potential movement of 1300 tonnes of gold, the Dutch central bank has announced a program to sell 300 tonnes, and it has been revealed that Kuwait lent out its full gold reserves, Jordan and Malaysia each has sold half of their gold reserves, while Russia was reportedly a seller of gold also. The media and the familiar array of gold bears don't miss a beat in capitalizing on the opportunity to spin this into the equally familiar but tired propaganda tale that gold is being demonetized and therefore dishoarded from central bank vaults.
+
Taking a quick look at the numbers will immediately dispell such a notion. Offered here are stats from a Reuters report that drew upon the IMF's monthly International Financial Statistics in order to give evidence of the Malaysian gold sale (31 tonnes) between July and August. The IMF statistics reveal that at the end of 1997, countries held a total of 886.69 million ounces in their reserves, whereas at the end of the third-quarter of 1999, this number has actually risen significantly, to 947.25 million ounces of gold held in reserves. This net gain suggests that these sales might more appropriately be perceived as interbank transfers, coupled with the acquisition of addition gold from nonbank sources.
+
On a final note, it is important to realize that the assortment of international central bankers are not akin to investment brokers, fund managers, or commodities dealers out to make a quick buck. Neither are the central bankers pprone to many of the petty political wranglings that tend to embroil their various national leaders into on-again off-again cooperative relations. The central bankers are more inclined to view themselves as members of a somewhat mutally supportive "club," and hence, more inclined to strike various deals to get through times of difficulty. If gold moves, it is generally for a purpose beyond a profit motive (they are not so dense as to fail to recognize that their gold is the only real money they hold, and you don't easily profit by losing your money.) You can be reasonably sure that such a flurry of central bank gold shuffling is as clear a sign of big things afoot as any observer could hope to see. The banks hold gold with a purpose and for a reason. Do you?

In derivatives trading of the gold futures on COMEX, the February contract traded through a range of $280.50 - $282.60 to settle in the upper half at $282.10, up $1.10. Spot prices were last quoted in NY at $279.90, also up $1.10 on the day. FWN reported that gold was rangebound amid quiet trade today. After last week's trading, open interest in the December futures had fallen to a minimal position of 414 outstanding contracts. (O.I. for the Feb. future stood at 65,420.) Delivery intentions so far for the month of December total 7,940 as of today...that represents 794,000 ounces changing hands. Comex warehouse totals today are comprised of 1,231,881 ounces of Registered inventory, and a meager 62,251 ounces of Eligible gold.

Bridge news provides us with this update on the hedging woes of gold miner, Cambior. Please note that the settlement terms have a distinct papery quality. Is this a miner or a hedge fund?

Toronto--Dec 13--Canada's Cambior, a mining firm, has reached an agreement
in principle with its lenders and hedge providers, regarding financial
restructuring. The agreement provides that Cambior's loan obligations, which
currently total US $212 million, will extend to and mature on Dec 31, 2000. All
loans will remain in US dollars for the balance of the loan period.
---
Reprinted at USAGOLD with permission. For details please go to:
http://www.crbindex.com/reviews/index.htm
No further reproduction without written permission

OIL

January crude futures gained at the end of the day to settle up 18� to $24.89 per barrel. Venezuelan oil minister Ali Rodriguez had somewhat weighed on the market with his suggestion that he does not expect oil prices to rise sharply from current levels, saying that world oil inventories are down to 80 days of supply, and that "According to the IEA, if inventories fell below 70 days there could be severe problems for these countries (major consumers). In the OPEC we have guaranteed in all our (public) declarations not to provoke changes (in oil prices) of this nature. For the moment this is not the situation."

Meanwhile, Iraq has accepted the next 6-month phase of the UN oil-for-food deal which allows Baghdad to purchase humanitarian supplies (and pay costs related to the Persian Gulf war,) limiting Iraqi exports to $5.26 billion throughout the 6-month period.

Brokers expect tomorrow's API data to reveal a decline in US crude inventories of 2.0-3.0 million barrels, the data to be released after the end of trade.

And that's the view from here...after the close.

Gandalf the White (12/13/99; 21:22:52MDT - Msg ID:20975)
GFD" comment !
You must be young GFD ! you said 90's --- try late 60's and 70's have you seen the cost of medical needs of the older generation ?
<;-)

gidsek (12/13/99; 21:17:15MDT - Msg ID:20974)
Leigh ... Ayn Rand
http://www.amazon.com/exec/obidos/ASIN/0787945137/qid=945144440/sr=1-10/103-1765338-5612608
I noticed your reference to AR in your post about Alan Greenspan. I'm a long time fan of Rands' and last year I took an interest in ARs' life outside of her prose. I wasn't too surprised to discover that though she was brillaint she was also a bit crackers.

The link above is to the book of Nathaniel Brandens' account of their relationship and is worth a read if you you are a fan of AR.

Rand used amphetamines for weight control for much of her life, perhaps this accounts for her appearance in the clip you saw in the A&E special.

gidsek

Peter Asher (12/13/99; 21:14:44MDT - Msg ID:20973)
THX-1138
Maybe they meant multiples of $20's, I thought that's all they had in them. Did you try $140 first?

Peter Asher (12/13/99; 21:11:36MDT - Msg ID:20972)
GFD

For a few generations now, people have been told to "Put their money to work" But, money doesn't 'work', people use money to buy thing to work with. The passive investor abrogates his responsibility as a capitalist, and he does so at his peril!

THX-1138 (12/13/99; 21:09:20MDT - Msg ID:20971)
Now for something completely different
Sometimes you have to turn things upside down to get a new perspective.

Let's say gold goes to $50,000/oz.
Is it really worth $50,000 or has the paper dollar devalued to $0.001 for each $1 FED NOTE. Thus a $50 Gold Eagle is worth just that. $50. That means I have an annual take home salary of only $3. Interesting.

And now for something about banks:
Went to my bank ATM Sunday to withdrawal $150 from my savings account. The ATM asked that I request a lower whole number. Therefore, I chose $100 and got my money. I used to be able to withdrawal over $200 at a time from the ATM. Y2K related restrictions or what?

Peter Asher (12/13/99; 21:06:40MDT - Msg ID:20970)
Christine's posts
I just figured it out. She's right. CIA stands for Centennial Intelligent Analysis Forum

SteveH (12/13/99; 21:03:10MDT - Msg ID:20969)
repost
www.kitco.com
Date: Mon Dec 13 1999 18:15
AzusaGold (Nov London gold turnover falls by a third - LBMA) ID#255250:
Copyright � 1999 AzusaGold/Kitco Inc. All rights reserved

LONDON, Dec 13 ( Reuters ) - Average daily turnover on London's gold market fell by a third month-on-month in November, the London Bullion Market Association ( LBMA ) said in a statement on Monday.

Daily transfers by the 12 LBMA clearing members fell to 25.3 million troy ounces versus October's 37.2 million.

"A new low was set in the number of transfers, which fell to 845, only the second time there have been less than 900 in a day," the statement said.

The value of gold transfers in November also fell by around a third to $7.4 billion from $11.5 billion in October.

Average daily silver turnover fell to a new low of 125.9 million ounces from 182.4 million, while the value of transfers fell to $600 million from $1 billion.

The number of silver transfers fell to 322 in November from 407 in October.

07:00 12-13-99

GFD (12/13/99; 20:58:41MDT - Msg ID:20968)
Auctions
FOA, one of the things to keep in mind in all of this is that people are worried about having enough to retire and so are conditioned to keeping their money in the markets. The irony here is that most would not even consider going to the strad auction - they feel that they have to keep their money working so that it will be there for them in their 90's.

There is quite a hammer lock on the average investing mind set.

Peter Asher (12/13/99; 20:50:48MDT - Msg ID:20967)
Dragonfly
I guess it helps to be a skilled carpenter.

Seriously though, "Thankyou."

Peter Asher (12/13/99; 20:48:23MDT - Msg ID:20966)
Leigh
Greenspan Bio
>>>>> He takes a two and a half hour bath every day. <<<<<<

Mabe Christine can analyse this for us.

dragonfly (12/13/99; 20:47:38MDT - Msg ID:20965)
Peter Asher (msg id 20956)
Well said. You sure can nail it down.

Leigh (12/13/99; 20:38:19MDT - Msg ID:20964)
Random Thoughts on Tonight's Biography of AG
1. They showed a clip of an interview with Ayn Rand. You know, her writings and philosophy may be sensible, but she looked like a lunatic! Her eyes kept darting around while she was talking.

2. AG is a guy who is LOVED by his wife and friends. Andrea's eyes were misty as she spoke about him.

3. AG has spent far too much time in the rarefied atmosphere of Washington/New York. He has NO IDEA of how middle-class Americans think and live.

4. The show mentioned that AG keeps his money in short-term Treasuries, not in the stock market. It didn't say if he has other holdings, like real estate or gold. Andrea said AG isn't into acquiring huge wealth -- he just enjoys doing what he does.

5. He takes a two and a half hour bath every day. Didn't anyone tell him that would shrivel his skin up?

It was an interesting show. Did anyone else watch it?

SHIFTY (12/13/99; 20:38:14MDT - Msg ID:20963)
(No Subject)
Maybe it will make it easier for the FDIC to bail out the banks if all that money is lost in a market crash?

dragonfly (12/13/99; 20:34:01MDT - Msg ID:20962)
Town Crier
Thank you Sir for the kind word and insights. I also enjoyed FOA's recent post. We learn much as we travel this road together.

dragonfly

SHIFTY (12/13/99; 20:28:15MDT - Msg ID:20961)
Morgan Stanley Dean Witter
Today I received the December 1999 PERSPECTIVES.
The current Recommended Asset Allocation is
STOCKS 70% BONDS 20% CASH 10%
Have they lost their minds?
Last month they recommended Stocks 65% Bonds 15% Cash 20%
I thought they were crazy then and now this.

Cavan Man (12/13/99; 20:17:58MDT - Msg ID:20960)
Dear FOA
I'm sitting here in between work on a mailer for The Church warming myself with your THOUGHTS and a glass of Chilean Cab Sav whilst many others are out shopping themselves silly.

Many thanks.

The thread of ME gold perhaps playing a continued role in world banking although within the context of a new regime we briefly spoke of; how will this come about.

With patience (and trying to ask the right questions),

CM

TownCrier (12/13/99; 19:34:22MDT - Msg ID:20959)
Sir FOA...lovely effort!
I tip my hat in your general direction...(picture me turning 360 degrees to ensure the gesture reaches you.)

The Scot (12/13/99; 19:30:16MDT - Msg ID:20958)
Cavan Man
Bring it on ! scot@wans.net

Peter Asher (12/13/99; 19:26:11MDT - Msg ID:20957)
Charts
http://www.kitco.com/gold.graph.html
Overseas gold and silver looking good

Peter Asher (12/13/99; 19:20:32MDT - Msg ID:20956)
goldfan (12/13/99; 17:10:32MDT - Msg ID:20944)
The Achilles heel in the Big Cheese event was the lack of community effort and of worldly knowledge on the part of the Farmers. If they had the knowledge of the intentions of the BC, the worldly awareness of "There's no such thing as a free lunch" and the willingness to stand together against the temptation of extra money; then they would have all told BC to "Stuff it!"

Back in the Energy crises 70's, A group of us where discussing the best asset to have for the economic EOTWAWKI. I thought I was smart by saying earth moving equipment and machines that make machines. But our tutor, who was a leading ecologist of that time simply answered; "No, knowledge".

The modern version of "Divide and conquer" is dumbing down the educational system and boob tubing the sheeple into an unaware concept of the world. A sucker may be born every day, but if he has a source of truth and data he won't remain one.

Literacy, Books, Forums and Gold; for a start!

lamprey_65 (12/13/99; 19:19:34MDT - Msg ID:20955)
Biography of the Year
Hmmm, wasn't last year's Biography of the Year Bill Clinton? (Right smack in the middle of the Lewinsky scandal.) Now we get Greenspan right before Y2K. Probably just a coincidence...but remember to support your local Central Bank!

Who owns A&E?

Lamprey

FOA (12/13/99; 19:15:01MDT - Msg ID:20954)
Comment
Mr Gresham (12/12/99; 14:04:52MDT - Msg ID:20807)

" " "Econ 675, Advanced Graduate Level Money and International Banking: Market Disequilibrium Scenarios, otherwise known as USAGold Forum" " "

-------------

Hello Mr. G,
Ha! Ha! That is some class you are taking. One of the things Another wanted to accomplish is happening. That being, getting Western citizens to reconsider exactly what gold was in the eyes of other real people. In order for that to happen, people had to understand the evolving modern
politics of gold and how it has created a "New Gold Market". One far different from the one goldgugs of the 70s had grown to know and love.

In the beginning, many readers had no basis for comparison when reading most of Another's Thoughts. Yet, we walk this evolutionary trail of gold today with eyes wide open and better able to grasp the impossible road ahead.

Onward:

I have seen one sure sigh that Westerners don't really know what has happened to their wealth. This is demonstrated when one "bemoans the loss of good times" if gold goes very high. It comes across the same every time; " " "if gold goes to $30,000 we won't have a dime and everything will fall apart" " ". Well, Another made his point that the dollar said your wealth was worth more than it really was. Let me demonstrate.

Like this:

Ever been to a high priced auction. They bring out the "Strad" violin and start bidding at $500,000. After a while it goes for $1 million flat and it's over. After that we listen to the perceptions around the room.

One guy in the back, who has 10 million cash, thinks the Strad was cheap at one mill and will pick one up next year. In fact he may get ten if they are offered. Some rich woman has 3 million and she figures her wealth is equal to three "violins" if she ever wanted them.

All around the room the feelings are the same as perhaps 100 million in assets are represented. They all equate their buying power to this one auction. Even though only one walked away with physical, everyone knows they are "strad rich" in wealth. Each goes home for the evening cognac
and relishes in this knowledge. Their lifelong effort of hard work and shrewd investing has positioned them to own the wealth of many rare violins. Life is good, very good.

The one problem with all of this is that they based their "wealth holdings" on the outcome of just one auction. Truly, had they all bid, the violin would have gone for much more and their wealth would seem "not so much".

In much the same way our world of dollar assets carries the same risk. All of us stand in the same world auction room and watch the daily bidding for goods and services. We watch the prices of cars, gas, houses, clothes, etc. and conclude our wealth balances based on what we could
acquire at this auction should we choose to bid. We see our economy in a light of infinite goods and services but fail to balance this with the potential of others to bid, "in mass". In this light, few have a valid perception of just how many dollar assets are out there. Indeed, without this grasp of "dollar inflation" we blindly consider out wealth and position in life using the present price structure of
"things". A system in which we trade paper IOUs of infinite number for real things of finite number.

So, our belief that life is good, largely rest not on the confidence in the dollar. Nor is it in the confidence that others will value and accept our dollars. Life is good, because all of us do not "bid" at the same time! If we did, our life would not be as good as our dollar wealth says it is!

This is the deception in our Western grasp of what wealth is. Our life savings are valued at what they can buy today, even though, in reality it is based on an unknown purchase price in the future. Just as all of the wealth at the violin auction was a phantom in self delusion, so too is our present good life and bank account numbers. The evolution of a people that once griped gold for the real
wealth money it was, has proceeded to the hoarding of bookkeeping entries of account credits. History has proven that once humans begin to question the value of this dollar "wealth owed them at a future unknown price" they run a race to outspend their loved brothers. Buying goods now at the "known" price quickly balances the books so no one is any longer fooled. The currency equivalents remain as a trading medium, even as real things are held in the background for value proof.

No, a high price of gold will not rob us of our wealth. It will rob us of this perception of money value that was but an illusion in the clouds. Wealth for tomorrow is found in this context for today; one cannot lose something they never owned. Buying physical gold at today's prices ($200 to
$500) will not help you maintain this modern illusion of wealth we never had. But will allow us to later spend the true value of gold that presently exists today. A value few will accept or believe.

Thank you all,,,,,,,,,,,,,,,FOA

TownCrier (12/13/99; 19:00:13MDT - Msg ID:20953)
Well done, Dragonfly.
I can safely assure you that you are in good company here among many who share your line of thinking. The oft' cited quantity of gold per capita equates to about 3 precious gold sovereigns. Everyone should ask themselves, "Do I and my family AT LEAST have possession of our appropriate share of the world's one true money?" A very small cash price to pay to obtain your worldly wealth, wouldn't you say?

By using your example wherein each person holds his own wealth in gold, if that person can temporarily suspend the notion of pricing the various things he might want to buy in terms of paper currencies, he can probably start to get a good feel for the future valuation of gold. Just think...to accumulate enough to buy a house, you would have to earn your additional gold as needed from those around you. While some people may balk and say this is impossible, considering that EVERYONE would at the same time be trying to gain more than their current share, and therefore nobody would ever be able to afford a car, let alone a house...try looking at this another way. What if you were told that instead of dividing up the world's wealth in gold, this would be done with the current supply of paper, and each person would get $50,000? Is it more conceivable that people would be able to buy what they needed? If the answer comes back, "Yes," ask yourself "Why?" After all, all you've really done is chosen an alternative way (using counterfeitable paper) to represent all of the world's wealth. Why should a cashier's check for $50,000 in everyone's wallet serve them better than a gold account in which they all held three gold sovereigns to begin with?

Sometimes a whole new world is only as far away as a fresh new perspective.

canamami (12/13/99; 18:50:34MDT - Msg ID:20952)
We're approaching "zero-hour" :-)
A certain poster on Kitco said the USAGOLD site will "go off the air" so to speak, at 18h00 Mountain time. Let's see what will happen :-)

Cavan Man (12/13/99; 18:50:23MDT - Msg ID:20951)
Leigh
In an era of iron ships and wooden men, there are too few compelling biographies to be written.

This past weekend we did "Breakfast with Santa" at an American Legion Hall; pictures of Harry Truman, battleships, war torn American flags and knotty pine panelling everywhere. Now, those were the days!

Leigh (12/13/99; 18:46:39MDT - Msg ID:20950)
Man of the Year
Biography's Man of the Year has just been unveiled! It's Alan Greenspan!!

Enjoy it while you can, AG. You've sold your soul and discarded everything sensible you ever learned in life. You have set the stage for the ruin of millions upon millions of trusting investors worldwife.

AEL (12/13/99; 18:38:25MDT - Msg ID:20949)
christine
Christine: "Anything wrong with informing in an entertaining manner? Stick around here for a few days. Much to be learned. And I promise grand entertainment at the same time as vast quantities of information. . . . Just relax and experience this as entertainment".

.......... fair enough!

Christine's posts are slightly amusing, utterly bizarre, quite irreverent, thankfully *short*, and so far free from reason, fact or documentation of any kind. Every Round Table should have one such court jester.

nickel62 (12/13/99; 18:23:44MDT - Msg ID:20948)
Gold Fan thank you for the kind words. I very much agree with your point.
Sometimes it takes years to see what is right in front of your eyes. Oh well!

dragonfly (12/13/99; 18:21:00MDT - Msg ID:20947)
a few thoughts
Dividing the 100,000 tons of gold in the world by 6 billion people equals about 1/2 ounce each. If gold really is the medium of storage of "excess wealth" of a lifetime and people got over the distraction of various manipulative paper games, think of what the "true value" really is. I think that in a changing world where people reevaluate what is important and real, that the relative values of things must change significantly. Gold's true value will be determined by the desire people have for it as well as the disdain for paper markets which have corrupted so many and helped to perpetuate injustices that would make infamous criminals blush. If the world comes to chaos and all prevailing certainties are put to the test, it may well become the case that some would rather have a few ounces of gold than the house that they need to leave for whatever reason. If gold were truly valued as the most honest way to preserve one's life-efforts, and it is as scarce as it is presently on a per-capita basis, then maybe we all could slow down a bit and end this fruitless paper-chase. Maybe one could live a simple and productive live free from the worries of inflation and all that implies. Maybe one could merely save as opposed to invest. Is that possible? Wouldn't this be the good life? Sometimes the notion that "Politics is the shadow cast by big business on society" influences my thoughts, but the belief that somehow we are savvy enough to create a better world also occupies some of my mind's space. John Donne (or Dunne?) said "Some truth there was, but dashed and brewed with lies, to please the fools and puzzle all the wise." I think this will be increasingly true as we enter the new world aborning. Sometimes the complexity of the analysis on the Forum leaves me a bit dazed but I am glad that some can keep up with the permutations of perversity that make up today's markets and I'm happy when some of it sinks in. (Then I try to relate it to my wife, whew!) (Actually she's getting it and usually can distill it down into very practical questions or suggestions). Anyway, keep up the good work and thanks all for the work and passion you put into your postings.

dragonfly

Cavan Man (12/13/99; 17:25:53MDT - Msg ID:20946)
Netking
Good man. This one will need lots of time and personal care. You are a better man/woman than me. Maranatha indeed!

Cavan Man (12/13/99; 17:23:43MDT - Msg ID:20945)
Hello FOA
I hate to ask a "timing" question but you make so many (necessary) references to the end of the paper market etc.

Still $5K within five years? What's the next hurdle and when? Also, what do your friends in the ME (assumption, granted) think about (care, if they do?)embedded chip infrastructure in the oilpatch (sorry, that's Texas talk).

Merry Christmas friend. (Sorry for the off topic reference)

goldfan (12/13/99; 17:10:32MDT - Msg ID:20944)
Nickel62- Who benefits?
http://www.usagold.com

Nickel62
I'm a fan of your idea that the powers conspired to knock down the price of gold so as to help the bullion banks and particularly, the big producers, scoop up hard pressed juniors at bargain basement prices. This is how I've seen the sharks of the corporate world behave in the past. I've long thought that it benefits not only the Arabs to have a low gold price, and the oil companies, but also, the big gold miners. In murder mystery detecting, a stock phrase is "Cui Bono?" If you want to find the murderers ask "Who benefits?" .

I remember when I was young witnessing the Big Cheese company come to town and make an offer to the small community cheese factory of our village. The small factory owners politely refused. The big cheese outfit thereupon, over a period of time, signed up all the local farmers producing milk to lucrative contracts, paying far more than the local factory could afford. Sure enough, in time the small outfit capitulated. The big boys bought them out for a lot less than their original offer. And again sure enough, as the farmers� contracts came up for renewal with the big honchos, they found they were being given "take it or leave it" offers for a lot less than they originally got from their own local factory. Next comes vertical integration, and one big factory farm owned by the Big Cheese, with 5000 head of milking cattle and the end of the community as a community.

The way we beat this stuff is to own gold, each of us, and set up our own local banks, credit unions whatever, and refuse to do business except amongst ourselves, and with small operators like ourselves in other parts of the country. IMHO

Thanks for your efforts.

Goldfan.

Netking (12/13/99; 16:53:11MDT - Msg ID:20943)
Christine
Christine; If you would like to E Mail me I have something to share with you 'off-line'.
<eagle1@hotmail.com>

FOA (12/13/99; 16:44:34MDT - Msg ID:20942)
Reply
Joey (12/12/99; 02:30:15MDT - Msg ID:20792)

Joey,
OK, I see how you perceived my reply. Let ne go further with you and then I'll present a different light to everyone in the next post.

Your words:
-----------------
1) You're quite right, I should not have suggested that Ashanti had in effect defaulted. Cambior, however, is as far as I can judge in a slightly different class in that they had sold considerably more calls maturing in 1999 than warranted by their production capacity. In this sense at least, they only avoided default by an effective "restructuring" of their committments.

----------------------

Again, I point out that both of these companies did not default. They failed to place more margin (cash money) behind their hedge positions. It made no difference to their broker Bullion Banks that gold was not delivered. As long as they covered their risk with more cash, the position could stand or be extended without physical. The outcome, as we all know was that they had no extra cash!
Recently, in London a big deal was made over the fact that many players in the paper gold arena were not being required to carry appropriate collateral against their short gold position. Whether they were miners, hedge funds, commercials or whatever, they shorted gold in the form of paper and bullion and this was being treated differently from all other asset trades. I submit that this practice has evolved from the past political position of supporting a lowering gold price with official gold sales, lending and most importantly "guarantees". Now that the Euro group has walked away from this position (at the absolute correct time for them), all the players in this field are left holding
positions that suddenly require much more margin, even with gold at these levels. No one is playing the gold lending game today except from being pressured from the possibility of severe risk if they don't. They now perceive this real risk in that physical gold could be withdrawn from supporting the paper marketplace by moving to physical trade only and doing so first on the official BIS levels.
Under these circumstances, commodity gold could become "super gold" and the reverse cash margin leverage against shorts of all kinds could be just enormous. The $600 "drop dead" level for Barrick could seem like the good old days of no margin exposure at all.

Now, with that in mind:

--------------------------

2) In response to my point (1), you suggest that defaulted paper could trade at varying discounts to physical. As is I think apparent from my earlier post, I agree with this but believe that given the degree of leverage extant, any such interlude would be brief and the markets would soon "lock up". In your comments on my point (3), however, you seem to imply that any peripheral default would be lethal. No doubt I misunderstand your intent but these two reponses do appear to be in some slight conflict.

--------------

Joey,
The discounts will first appear small for some time as players assess the situation and begin to conclude that default is possible. First notice day on comex will find some players actually getting bullion at a discount, but most will begrudge the cash close as not representing a fair market. They are the ones that always roll over or close out without delivery. Not that default has happened or will soon, but that it is a possible risk that will create the first uncertainty. We are "on the road " in this direction as I write. It is becoming apparent that some OTC paper gold may be at risk of forced settlement in some kind of "physical discounted price" of dollars if any "peripheral default" does show it's face. Again, I submit that the discounting of all paper will begin small prior to the real
default and this action will slowly kill the modern paper gold markets. Until! Like this:

Some 95% of the Western traders in paper gold today, do not take delivery. They are in this game only to receive the cash price gain (or loss) as a means of gaining the increases value of gold. For them, the integrity of the market is not in it's delivery ability, rather in it's ability to mark their long contracts to the market price of physical. In their perception, their only risk (outside of price movement) is that these contracts are not settled at a cash price, close to buying spot physical. This is the little known "weak spot" in this system.

If delivery of physical does become somewhat of a problem on the massive OTC world arena, it would show itself first, not in an increased price of futures over physical but in a discount of futures to spot physical. Yes, the futures would rise in price as some shorts cover and the contracts try to keep up with physical. But remember, in a real physical shortage, the world BBs that make this paper market will be selling paper to the very limit of their ability to keep the paper prices from going against them. For them, the physical price is secondary as it's the paper market that creates price discovery and controls the settlement margins. Our recent run was not how the end will
appear. When the real play begins, physical (not futures or paper) will soar ($100, $200 or $300+++) the first day! The futures will try to run and then fall far away. Some in the media will no doubt say that the physical bars are trading at a strange premium to the real price of gold. It will
come across that the paper price is not in discount, rather it's at par as the coins show this huge premium. I know that's nuts, but we will hear it.
This dynamic will manifest itself in the form of futures being bid to discount not only from the BBs but from the commercial traders not wanting to risk a "par" trade for what may be cash, not gold. In the end, because the spot month creates the settlement price, trading could be forced into immediate cash settlement on close before delivery and not marked to the higher physical market. Or, all futures could see a "cash liquidation" decree as trading locks. Indeed, a close that will find physical trading much higher than that cash close. Large players will understand this well before the fact and dive head first into whatever physical can be had, further gunning it's price.
This is the realm of "super gold". It's what being on the road will feel like. However, the ending of our present paper gold markets will not end the coming rise in gold. No, that rise will have only just begun.

Please read my next post, FOA

Netking (12/13/99; 16:39:54MDT - Msg ID:20941)
POG
http://www.kitco.com/gold.graph.html
Gold - Apppears to be locked in the 278-281 band for the moment. Things seem very quiet in the market, open interest doing nothing, traders com's doing nothing & appears all seem to be waiting for "something" to happen. Perhaps the calm before the "proverbial"?
Maranatha Netking

Cavan Man (12/13/99; 16:08:24MDT - Msg ID:20940)
JCS (and, The Scot if you're there)
No doubt about it; evil incarnate is and has always been afoot in this world. Send me your email address and I will relate to you a story of a twenty year old miracle that I heard this weekend by the man who was there to witness it.

www.tetranet.net/cavansales

JCS (12/13/99; 15:36:05MDT - Msg ID:20939)
Cavan Man (12/13/99; 15:28:42MDT - Msg ID:20937)
My apologies to you, Brother.
If you saw some of Friday afternoon's dialog over at Kitco you will know why I tense up a little when someone jabs at me. I TRY to take it all in stride, but probably do take it a bit too seriously (after all, its just one's eternal soul at stake, right?)
Once again, sorry for bristling up.
JCS

TownCrier (12/13/99; 15:32:59MDT - Msg ID:20938)
Does this sound like a POLICY to you? Or merely pabulum for the press?
http://biz.yahoo.com/rf/991213/6a.html
U.S. Treasury Secretary Lawrence Summers pulled the toy string on his chest once again today, and out came the familiar words..."We've stated our policy on our currency many times. We believe a strong dollar is in our national interest."
He didn't stop short of putting the monkey on Japan's back, saying that developments in Japan were key to the entire global economy. We can already sense them wincing from an ocean away knowing as we do that Wim Duisenberg said the ECB would never intervene with Japan alone to curb the yen's rise...although BOJ Governor Masaru Hayami assured his parliament last week that they would act alone if needed to curb the rising yen.

Meanwhile, the US sits back with its *policy*. Yep...that's quite an active policy.

Cavan Man (12/13/99; 15:28:42MDT - Msg ID:20937)
JCS
Please accept my humble apology.

Cavan Man (12/13/99; 15:26:59MDT - Msg ID:20936)
JCS
I am myself; very strong. I agree with you completely. I guess my (poor) sense of humor was misunderstood.

Cavan Man (12/13/99; 15:24:49MDT - Msg ID:20935)
A funny thing happened at the bank....
I've been holding some US Treasury Bonds (EE, I believe) that were given to our family as we gave birth to new taxpayers. We had a nice collection. The other day, I decided to cash all in and go to a local coin shop.

When the teller began toting up the remittance, she came across one ($100 face value) that said, "POD". She said she couldn't take that one. I asked why. She said POD means "payable on death". I said whose death, "mine or my child"? She said, the child.

My first thought was what nitwit relative of mine would do such a thing? I mean, how morbid can you get IMHO? My second thought was, why would I worry about $100 if my child died before I did? My third thought was a terrible thought to contemplate. In a flash, I tore the bond up! The teller let out a gasp; she was shocked. She found another POD and I asked for it. She said please don't tear it up. I could see she was in distress so I promised I would not tear up any more bonds at her window. Rather, I said, I would destroy them at home. That's just what I did.

K-Rand and customer are both doing well.

Kind regards on a "kooky day"....CM

JCS (12/13/99; 15:18:51MDT - Msg ID:20934)
Cavan Man (12/13/99; 13:29:58MDT - Msg ID:20917)
I am an advocate for The Faith.
If challenged, or abused, then I will defend.
Otherwise, I will lay silent as a sleeping bear.
Fair enough?

goldfan (12/13/99; 14:57:42MDT - Msg ID:20933)
Stock Markets, Ponzi Schemes and Gold
http://www.usagold.com
Part of my reason for being in life is that of a crying baby, to get fed, to get attention, and to express myself. The other part is as mature person to try to pass on what I think I've learned.

I write here to help myself and my friends understand why gold. What follows is my distillation of what I got from the teachings of the Elders on this site, ORO, Aristotle, FOA and many others. I would be grateful for any and all correction and criticism.

How is the stock market a Ponzi scheme?

A Ponzi scheme ( popularly called a "pyramid") is a set of activities designed only to bring in more money with which to make inflated payouts as "bait" for more suckers. The activities are public relations and promotional only, or mostly. The "good" that people buy from it, is only a promise of future payment. There is no "settlement", except for a few, and the insiders, before the scheme collapses.

(Hmm..now I read this over, I wonder how my description differs from the average Mutual Fund?)

A basket ball game might be considered a Ponzi scheme, except that there is "settlement". People pay for the game they see, and have no further claim on payouts.

Ponzi schemes collapse completely when the few payouts stop happening at all. No new money comes in, the original money is all used up, a large percentage of "shareholders" are left with no return, not even their capital.

To the extent that people cannot possibly get payments in the amounts they expect or are implicitly promised, to the extent they lose a large portion of their capital input, the stock market is a Ponzi scheme. People who have mortgaged their houses, maxed their credit cards, and saved nothing except what they have "invested" in Mutual Funds will inevitably lose a large portion of their contribution to the "Ponzi scheme" that the markets have become in our time.

When a consumer buys a piece of Microsoft software, "settlement" occurs , money paid, goods received. (Whether expected value is received is another matter). But when a person buys a share of MSFT, she is contributing to something like a "Ponzi scheme" (I won't call it an investment, since it clearly isn't). In a "real" Ponzi scheme, the promise of a payout of 100X or 1000X is made, usually verbally, or by word of mouth, or reference to "My neighbor got". How is this different from what the whole world is hearing about Microsoft? Even the Governors of the Board of the NYSE have said it is a completely legitimate enterprise. Even their auditors have blessed its phony book-keeping, with no warnings or caveats.

On the Bloomberg site today a Mr Currier writes "However you approach Internet investments, take time to recognize the risks and protect yourself against them by staying as diversified as possible. Play the ``technology lottery'' as you would any other game of chance." (Emphasis mine).

He called it right. The whole thing should be treated as the "gambling" that it is. In this at least, the Tech stock advocates are in exalted company. The big banks and currency traders daily gamble in the world's currencies to an extent equal to 250X the amount needed to conduct trade in real goods and services. They have become one giant world casino, where trade in goods and services is like trade in cigarettes and alcohol in genuine casinos, something that is just done to get the players into the joint so their money, their savings, can be put into play for the benefit of the casino owners.
All over the world, "savers" are being induced to contribute the wages of their labour so that government activities in the Ponzi scheme of international finance can enable "skim-offs� for the originators of the scheme, including Nobel prize-winning economists like those who founded LTCM, etc.

Microsoft and Bill Gates for example, may well be able to use its share of the"skim-off" to buy enough factory farms, 3rd World shoe factories, and real-estate developers, to keep their managements living well long after the vast majority of shareholders have lost their stake entirely.

How does all this relate to Gold?

Well, when I buy physical gold with cash, and take delivery, settlement occurs immediately. I got what I wanted and paid for it . All over the world, my gold can be exchanged for land, for food, clothing and shelter. This is my expectation and has always been the reality. Of course, it's not certain that I can get, with whatever gold I have, all I need of these essentials for survival. But, history shows that gold is the most stable asset in purchasing power, of all the possible assets. History shows, that I can always borrow against it, for whatever I need, pay back these borrowings out of savings from my daily work, and still have my asset as security for my old age. {Nickle62, 12/13/99, Dec. 13/1999)

If you purchase gold paper, you are entering a Ponzi scheme. If you purchase physical gold, your "settlement" occurs when you hold the gold in your hand. Buying physical gold is not entering a Ponzi scheme.

When you buy a car you're not entering a Ponzi scheme. You buy based on your own assessment, on the knowledge gained about car buying, about what your purchase will do for you, what it is worth to you. Settlement occurs immediately when you drive off the lot. Additionally, in the past 100 years a whole apparatus of safeguards for car buyers has grown up. Insurance, warranties, repair and after market parts systems, etc. Those elaborate safeguards do not exist for purchasers of Mutual Funds, or any other form of paper investment, including, gold paper. This includes government treasury bills, as long as governments print money to pay them off, instead of taxing people and corporations to force the necessary savings to pay them off.

In my time, whatever safeguards were put in place at the last crash of the markets, have always in time been dismantled at the behest of finance people and corporations who want unfettered access to people savings. The business world wants to collect its loot without having to follow any rules for return of capital, or interest. And what the business world wants, it usually gets, in time, until the next collapse.

When the "Titanic" of world financial schemes sinks, no paper investments will be a secure life boat. Even the best looking of them may well have some "off the books" obligations that will transmit their ownership or assets to someone other than the public shareholders. Ashanti and Cambior and Barrick are but the currently visible "canaries" in this mine(field).

Prediction

So how do we predict when a Ponzi scheme bubble will burst? In a "real" Ponzi scheme, the bubble has usually burst by the time you get to hear of the scheme. But those closest to the center, know when the accumulation mania is peaking, the distribution demand is getting too hot, the cash available too low for more payouts. Time to hit the road.

In an honest, legitimate financial world, one would buy stocks based on eps criteria and so on. If they had no earnings, one would recognize the purchase as a gamble, and treat it accordingly. Either one enters the world of no earnings, no history, no dividends as a gambler, or as a fool, expecting a massive return for no effort, no analysis, a return from a perpetual motion money machine, not a legitimate business. I'm willing to bet that at the core of the financial world, they have already prepared to switch off the lights, and hit the road, to let the scheme collapse behind them, keeping their own places in the sun.

Gold is not an investment, any more than potatoes are. Potatoes will help you survive today. Keep some for seed, they will help you survive next year. Gold will help you survive when you're too old to plant any more potatoes, or when the Mob steals your land.

Goldfan.

Cavan Man (12/13/99; 14:56:51MDT - Msg ID:20932)
Number Six
Don't know. I don't lurk or post anywhere but here because of the very high quality of this site. Tom seemed to go off the deep end one day and that was the end of him here. I assumed his license was suspended.

TownCrier (12/13/99; 14:50:10MDT - Msg ID:20931)
Fed's Minehan says restraints on inflation ending
http://biz.yahoo.com/rf/991213/y7.html
Boston Federal Reserve President Cathy Minehan doesn't paint the rosiest picture that the party on Wall St. will rage on without end. She said the factors which have kept prices low/steady in recent years now are ending..."the effect of these temporary factors is now turning the other way," and "Those extra sources of capacity that helped our machine run for so long without overheating in the face of tight labor markets are diminishing."

The next policy meeting of the Fed's FOMC is December 21st.

nickel62 (12/13/99; 14:40:17MDT - Msg ID:20930)
Aristotle I think your answer is the very people who Manipulated gold down in the first place.
Why because to have let gold rise to $425-$500 where it was headed back in the first quarter of 1996 by now we would have been knee deep in low cost over production. A death through abundance that would have caused the de-monetization of gold for real. The 50 to 1 above ground inventory would have caused the gold price to plunge beyond the lowest costs producers ability to survive. One, the owners of gold knew that the demonetization that would result from a prolonged rise was more damaging than a controlled lowering of the price over time. The bullion banks and certain producers formed a cabal to manipulate the price lower and wipe out all the venture financed new production before it came on line. Two, the central banks knew that they needed a universal currency like gold to make the system work and were not real interested in seeing it destroyed,also the fact they owned 28,000 tonnes of the stuff meant that they would be doubly damaged as the rapid fall could have led to a loss in confidence of the currencies of these same countries.Three, by keeping the competion of new entrants out the existing producers could be cut into the game and used to buy up the bankrupted mines of the uninitiated,and use these new assets to control and monopolize the future price by controlling production levels.The Central Bank lease rates would be used going forward as a way to extend the control over the mines. If this sounds familiar it is because the strategy is similar to the use of a "Green Shoe" in an IPO where a artificial short squeeze is created in order to provide support for the stock in the aftermarket. Four the breadcrumbs lead to the very controllers of the manipulations as the buyers of all the gold on the way down beause they new they would have a true asset when it turned and the only way they could hedge their exposure to the insanity of the equity and dollar markets was to have a hedge as large as the gold market sold short a hundred and fifty dollars below were it should be. So Aristotle I believe the answer is goldman in the basement with a double cross.

Galearis (12/13/99; 14:25:49MDT - Msg ID:20929)
@goldfan about leasing
Something very strange is happening in the silver market. Just today, if one can go by the graph there has been no trading activity since 11:00am. I know things are usually quiet on Mondays and gold shows the same Monday "hangover" pattern, but there is far more activity on the lease rate (they climb) which would indicate more activity than the charts presently indicate. This same stale market pattern has been going on for almost three weeks and is getting worse. The rate hikes last week, however, would indicate some rollovers taking place. Last week there were hikes in the one month rates; today some rise on the six month and yearly rates. Everything is soooooo dead. (The calm before the storm?)The Buffet spike (a yearly short covering rally of rollovers) has as yet failed to appear.

The one thing that is reassuring in this is the massive supply deficit looming over this market. With only nine or ten months of above ground supplies available one would almost think this thing was manipulated ; ^ ). Yet we have a market pattern that shows very little demand! (For paper trades?)

I think I will phone rhody tonight and get his take on this and get back to you tomorrow.

Christine (12/13/99; 14:18:35MDT - Msg ID:20928)
Unacceptable CIA activities
Further engagement in unacceptable activities by the officers/agents concerned will result in Court Martial by the US Government.

TownCrier (12/13/99; 14:15:39MDT - Msg ID:20927)
"...a commitment to continuing to adapt and reform the IMF."
http://biz.yahoo.com/rf/991213/42.html
Speaking in regard to the candidates for the next head of the International Monetary Fund, U.S. Treasury Secretary Lawrence Summers said "Our judgment is that what's important is to get the strongest possible person to lead the IMF." Speaking during a stop in Britain on his way to the G20 meeting later in Berlin, SecTreas Summers also said, "We believe the crucial dimensions that any future managing director must bring are proven leadership ability, strong experience in the financial area that represents the IMF's core mission, the ability to command consensus around the world...and a commitment to continuing to adapt and reform the IMF."

Times, they are a changin'.

Christine (12/13/99; 14:10:04MDT - Msg ID:20926)
Unacceptable conduct by US CIA Agents
Due to ongoing unacceptable conduct by select US CIA agents, this site will be shut-down today. The official site representing the USA government, including legitimate CIA activities, will be soon be officially announced to those concerned as being Kitco.

schippi (12/13/99; 14:03:49MDT - Msg ID:20925)
Gold stocks: antidote for technology
http://cbs.marketwatch.com/news/current/stwatch.htx?source=htx/http2_mw
This recommendation to Gold Stocks
is from one the World's Biggest and
long term BEAR!

nickel62 (12/13/99; 13:58:51MDT - Msg ID:20924)
Goldfan thank you ! yes the yen quote is yen /gram and is taken from GFMS Annual for1999
The data got me thinking as I was typing and I lost some of the care I should have been taking in the excitment of finally putting a piece of the puzzle together that I had missed before. You are correct I hope the other typos and miss spellings were more obvious.The data is on page 102 In the Gold Fields Mineral Services Annual Gold Survey for 1999.It is Appaendix 3 on page 102.

el St.One (12/13/99; 13:58:40MDT - Msg ID:20923)
Christine
This is why the DELETE KEY was invented.

Number Six (12/13/99; 13:58:32MDT - Msg ID:20922)
This could be IMPORTANT news... curiouser and curiouser...
Le Metropole members,

A little Midas update.

Gold popped up $1.10 today to close at
$279.70 bid for spot delivery. The market
was very quiet.

The most significant news of the day will
not be reported anywhere. Goldman Sachs sent
out an automated call to their clients in
the middle of last night making sure that
they all knew that even if one of the 15
European central banks scheduled to sell
gold over the next 5 years as part of their
new agreement decides against selling, that
other ECB banks were standing in line to sell.

Why make a comment like that and why in the
middle of the night? I asked the Caf�'s John
Brimelow for his take on that. He said it
sounded a bit "alarmist" to him. Could there
be some sort of bullish announcement coming
and they are trying to pre-talk down any
future effect this would-be announcement
might have?

Chase Bank and AIG late Comex sellers with
Goldman Sachs a big buyer today.

============================================================

Any thoughts?

el St.One (12/13/99; 13:58:15MDT - Msg ID:20921)
Christine
This is why the DELETE KEY was invented.

el St.One (12/13/99; 13:57:30MDT - Msg ID:20920)
Christine
This is why the DELETE KEY was invented.

Number Six (12/13/99; 13:50:11MDT - Msg ID:20919)
Cavan Man...Re Tom Fumich
Hi Cavan Man,

What's the story with Tom, I haven't been on Kico lately?

nugget0 (12/13/99; 13:40:50MDT - Msg ID:20918)
I see the CHRIS virus has appeared here
this one has an easy fix....ignore it

Cavan Man (12/13/99; 13:29:58MDT - Msg ID:20917)
To JCS
No references to religion here please.

Cavan Man (12/13/99; 13:28:14MDT - Msg ID:20916)
20912
At least poor old Tom Fumich admitted he had a few problems.

Cavan Man (12/13/99; 13:26:13MDT - Msg ID:20915)
20912
As Detective Harris used to say on Barney Miller, "Time to check this one into the hotel silly".

Felix the Cat (12/13/99; 13:10:47MDT - Msg ID:20914)
#Christine
I got fun in your Msg ID:20891.
Is that a kind of theories of Buddhist?---When we don't believe anyone, that means we believe everyones---because we don't know what is the different between "believe" & "don't believe".

Xie Xie

F. C

jinx44 (12/13/99; 13:01:30MDT - Msg ID:20913)
Christine
PH-LA&JCS

You have my support on the Chris issue. He/she/it has made a mess over at Kitco and elsewhere. I hope MK will put a stop to it soon. It reflects poorly on all of us here, not to mention the absolute waste of bandwidth.

Christine (12/13/99; 12:57:20MDT - Msg ID:20912)
@ss of nep
http://www.triax.com/bmnfa/science/ORMUS/whatisit.htm
One of the Gold Cabal's, aka Illuminati's, lesser secrets is that they routinely ingest monatomic gold--this is in part how they obtain their superior abilities to pull off the gold scam to begin with. Don't be fooled by their disinformation you cite. The Illuminati have ingested 7,000 tons of gold in the monatomic form in the past 20 years. This is one of the reasons for their current massive gold market manipulation. Because of Illuminati long-term gold market and banking manipulations, we are only days from entering a shocking economic crisis.

Agent Chris--CIA Liason Officer

However, please rest assured that the Illuminati and their agents are under secure US Government control now.

JCS (12/13/99; 12:20:14MDT - Msg ID:20911)
PH in LA (12/13/99; 10:37:24MDT - Msg ID:20892)
Re: Christine/Chris
I second the motion!
This same thing happened at LongWaves a few months ago and two subscribers who were "contributing" were banned.
At some point in time the "game playing" has to cease, and with this one (the party in question) it never ends.
My biggest rub over the Kitco postings are the blatant blasphemy. Everyone is entitled to their own beliefs about the Divine and higher powers, but over at Kitco her material borders on something out of the dark ages.
Sincerely,
JCS

TownCrier (12/13/99; 12:17:29MDT - Msg ID:20910)
Follow up to Solomon Weaver's related post...(12/12/99; 21:38:19MDT - Msg ID:20854)
http://www.usagold.com/halloffame.html#anchor213884
You suggested in your conversation with Peter Asher that "...if you go out and get $100 from the bank, by the laws of the FED, some bank is required to call in a loan to the tune of $1000 (possibly even several thousand)."

I can only imagine (with difficulty) such a thing happening in an absolute worst-case scenario. Please visit the link above to see an example of the mechanics of how such a withdrawal would play out in the banking system.

Orca (12/13/99; 12:15:36MDT - Msg ID:20909)
Sherre Lapointe - Madison Enterprises
http://www.madison-enterprises.com/
Madison is an extremly encouraging junior (very undervalued at this point.... like most juniors). The gold deposit is in Papua New Guinea and has been under exploration for a long time. It is about 8 - 10 miles from the 1m oz/year Placer Dome Porgera Mine, and the deposit at Mt. Kare (Madison) shows as much if not more promise then the Porgera mine.

They have just recently acquired pretty much total ownership in the holding (from CPC Australia).

This does look like its one of the few juniors that will wake up when gold wakes up, as it is pretty mature, being developed very methodically, has an excellent geology team, and most of all a deposit that is growing.

This one bears watching, and is probably a steal that will reap rewards when gold does its thing.

TownCrier (12/13/99; 12:10:19MDT - Msg ID:20908)
HEADLINE: China has promised a radical opening-up of finance. Can its banks cope?
http://www.economist.com/editorial/freeforall/current/index_fn2516.html
As long as the world's most populous nation is to undergo banking reform, why not overhaul the global system of banking while were at it?

As Sir Solomon Weaver said in his (12/12/99; 22:22:21MDT - Msg ID:20864): "One potential windfall in all of this: In a system where the banks are required to have a fraction of their outstanding loans present as reserves, we call the system FRACTIONAL RESERVE BANKING.
In a new system where there are no reserve requirements we can just call it BANKING."

Simple *banking*. That's a great notion!

But on a technical note, where you mentioned a requirement for a fraction of outstanding loans required as reserves under our present banking system, it would have been more accurate to say that a fraction of the banks' liabilities (deposits) are required to be held in reserves, not loans (which are booked as assets along with their vault cash reserves.)

Mr Gresham (12/13/99; 12:08:37MDT - Msg ID:20907)
Trolls
MK, PH in LA, others:

As a moderated forum, we have no obligation to oblige TROLLS here.

Trolls are people who deliberately or mischievously confuse and mislead or clutter a discussion about which the other participants truly care.

If you want to view the experiences of an unmoderated forum under a TROLL invasion, go to TB2000 and search on the menus there, especially from Feb.-June of this year. You'll find enough there to persuade you of the merit of any actions MK chooses to take in defending our forum.

goldfan (12/13/99; 11:59:08MDT - Msg ID:20906)
Nickle62, Galearis Leasing
http://www.usagold.com
Nickle62

Thanks for yours on leasing to Solomon Weaver. it gave me a vital piece of data re value of Au over time. I'm puzzled however at the yen values here, surely they're too low??

nickel62 (12/13/99; 9:11:26MDT - Msg ID:20887)

The US dollar during this period declined in value by an annual compound rate of 3.97% as gold went from US 124.77/ounce to $294.00/ounce on December 30,1998. The Yen meanwhile went from a Yen price of gold in 1976 of 1,191 yen to the ounce to a yen price at the end of 1998 of 1,238 a rate of decrease annually in value of the yen of 0.18%.

Galearis

Thanks for your welcome the other day. I'm very interested in your observations re the Buffett spike. Rhody at the other site in October was confidently predicting its occurrence these days too. I have a curious feeling that unless someone has an explanation for what is going on with silver, all the ideas about gold may also be badly skewed. Long ago I was a computer programmer. The most serious work was not in writing the programs, it was in degugging them. Then I learned that unless I could explain the reasons, every single one of them, as to why I was getting the wrong results, I hadn't yet found the bug. I hope you find the bug!! I don't even have a clue where to look.

Goldfan

ss of nep (12/13/99; 11:36:58MDT - Msg ID:20905)
Chris / Christine .................... have you been at this link ?
http://www.phoenixnewtimes.com/1996/091996/feature2-1.html

Cavan Man (12/13/99; 11:35:27MDT - Msg ID:20904)
Tom Fumich
Poor old Tom finally hung himself here. What's the deal?

Sherre Lapointe (12/13/99; 11:32:35MDT - Msg ID:20903)
madison enterprise's
http://www.madison-enterprise's.com
looking for anything about madison's Mt Kare project

Sherre Lapointe (12/13/99; 11:28:36MDT - Msg ID:20902)
madison enterprise's
htpp//madison-enterprise's.com
anyone out there have new's on madison's Mt Kare project.

Sherre Lapointe (12/13/99; 11:24:25MDT - Msg ID:20901)
(No Subject)
htpp//madison-enterprise's.com
anyone out there have new's on madison's Mt Kare project.

Christine (12/13/99; 11:21:28MDT - Msg ID:20900)
@TEX
Anything wrong with informing in an entertaining manner? Stick around here for a few days. Much to be learned. And I promise grand entertainment at the same time as vast quantities of information. Of course, seeing will be believing.------Agent Chris, CIA Liason Officer

Sherre Lapointe (12/13/99; 11:17:19MDT - Msg ID:20899)
Madison-enterprise's.com
http//www.madison-enterprise's.com
looking for info on madison's Mt Kare Project.

Christine (12/13/99; 11:16:45MDT - Msg ID:20898)
PS--@CIA Agent "PH in LA"
If you find my posts ridiculous, why have you apparently been following them so closely as to be able to give a fairly detailed summary of what I have been saying at Kitco. I personally pay very little attention to things I find ridiculous, unless they are entertaining and/or there is more to it than that.------CIA Liason Officer Chris

TEX (12/13/99; 11:14:25MDT - Msg ID:20897)
PH in LA's Post RE: Christine
HEAR....HEAR! I Agree with you. I'm not lurking to be entertained.....I'm at the FORUM to be educated.

Sherre Lapointe (12/13/99; 11:13:23MDT - Msg ID:20896)
Madison reterprises
http//www.madisonenterprises.com
looking for info on madison.

Christine (12/13/99; 11:02:44MDT - Msg ID:20895)
@Gandolf the White, PH in LA
Yes, and yes to Gandolf

PH in LA,
I can assure you that if USAGold could remove my posts they would and will. If my posts are so ridiculous, why do you care? Just relax and experience this as entertainment.

TownCrier (12/13/99; 11:01:53MDT - Msg ID:20894)
Lots of high-level financial meetings this week
A regular meeting of the Band for International Settlements among the G10 and other central bankers is now underway in Basle. (Ahhhh...to be in Switzerland in December!) Elsewhere, and later in the week (Thursday) there is a closed-door meeting of the G20 in Berlin. In addition to the representatives of the 20 nations, the ECB's President Wim Duisenberg and IMF's Managing Director Michel Camdessus will be in attendance. US SecTreas Lawrence Summers has indicated a preference to focus on reshaping the role of the IMF. Discussing M. Camdessus' successor is also sure to be high on the agenda.

Speaking of personnel turnover (and whatever can be read into a changing of the guard (keeping in mind the departure last summer of SecTreas Robert Rubin,)) this summer the LBMA appointed a new Chairman, then this autumn their Chief Executive of four-and-a-half years stepped down. Lot's of fresh new faces in the works out there in this grand theatre of our concern...IMF, USTreasury, and LBMA.

Gandalf the White (12/13/99; 10:45:23MDT - Msg ID:20893)
WOWERS --- Have you seen the PPT today ?
Christine -- Please tell me that you also work with the PPT and your arrival here at the TableRound is directly in relationship with the EXTRA effort of the PPT driving the S&P futures this morning from last weeks levels of low single +digits, TO LEVELS of over +20 this morning !!! AND still the market is DOWN. --- Looking interesting, for GOLD.
<;-)

PH in LA (12/13/99; 10:37:24MDT - Msg ID:20892)
Open Letter to Michael Kosares regarding poster "Christine":
Dear Michael:
You may recall that I advocated a slightly different solution to the "Stranger" matter than the one you finally chose, which has also turned out satisfactorily. Much discussion was generated on that occasion, which did not surprise anyone, mainly because Stranger had offered much that was appreciated during his tenure as an accepted participant in the proceedings here. However, since on that occasion I advocated a policy of letting the forum police itself, I would like to offer a suggestion on how best to handle the spectacle that the poster named "Christine" is starting to make of herself here at USAGold.

Many will recall how Christine made a point of drawing FOA into an ultimately frivolous exchange when she first appeared here at USAGold many months ago. Gentleman that he has always shown himself to be, FOA tried several times to help Christine clarify her "views" and actually devoted considerable time to that effort. Christine, on the other hand, made no effort or progress towards rational thinking and soon withdrew from here, leaving the forum intact.

Since then, she has made every effort at other forums, especially Kitco, to expand on her reputation as a fuzzy thinker and has surpassed everyone's expectations in showing herself to be a complete clown and intellectual nonentity, to the merriment of all at Kitco. Aliens, CIA spooks, Venus the love goddess: There have been few limits to the absurd posts she has offered. To call her contributions "thinking" would be to stretch the limits of the English language well into new realms.

Lately, she has reappeared here with a number of ludicrous and idiotic accusations about CIA opperatives, etc. which she has made no effort to back up with evidence of reasonable and/or logical argument of any kind.

Michael: This forum has from its inception attracted thinkers and writers who actively and honestly seek answers to some of the big issues that face us as human beings. We do not come here to see clowns and/or baffoons or to seek entertainment. Christine and those who tolerate her elsewhere are largely what makes Kitco a mockery to serious discussion. Let's not put up with her or her kind here. Her posting code should be withdrawn immediately! You should not feel any responsibility to explain yourself, or seek to stimulate discussion of any kind about this. Christine has demonstrated that she is no longer within or anywhere nearby any accepted framework of rationality and she should be quietly dismissed from these chambers. Not kicking and screaming. Simply without any comment whatsoever. She is a nut. She does not amuse us. And she will not be missed! Period.

Christine (12/13/99; 10:18:48MDT - Msg ID:20891)
@Felix the Cat
Can you trust anybody? That is the whole point. Some may be trusting others that they should not. Some need to ask themselves whom they are involved with and to what purpose.

Agent Chris--CIA Liason Officer

TownCrier (12/13/99; 10:14:44MDT - Msg ID:20890)
Fed continues to throw wood on the blaze...er, I mean add money to the banking system...no, wait--it's all the same thing
http://biz.yahoo.com/rf/991213/ti.html
With Friday's $3.53 billion of six-day fixed-system repurchase agreements still on the books (in addition to countless billions in long-term repos that span the Century Date Change) the Fed today added another $2.308 billion in temporary reserves via overnight system repurchase agreements, and participated in the outright purchase of Treasuries (February 15, 2005 to November 15, 2016) to add $963 million in permanent banking reserves.

nickel62 (12/13/99; 10:01:09MDT - Msg ID:20889)
Prior post If I'm correct about the motivation behind some of the market manipulation it truely mixes up the picture.
If the real danger to the value of gold as an asset is unbrideled production hitting the market all at the same time, then the capping of the price and the manipulation downward would take on another whole perspective. The Central Banks at the center of the monetary policy rigging would logically hold their gold resers=ves and go along with the plan to retain the value of gold they hold and to continue to have gold fill the critical function it plays as money in times of extreme distress.Their manipulations then take on the aura of needed function rather than covert heist. Maybe the truth is that it was a little of both,which would be much more the norm.

Felix the Cat (12/13/99; 9:53:36MDT - Msg ID:20888)
Chirstine
Hail Christine,
Your Msg ID:20813 is very interesting posted.
In the same way---Who are you? Can I believe you?
<:-)

F. C

nickel62 (12/13/99; 9:11:26MDT - Msg ID:20887)
Repost To solomaon Weaver with a few less gramatical errors.
Solomon Weaver I read with interest your post on leasing rates and I think I have a few thoughts that might help.
I was reading a table of gold prices in deveral different currencies sevral years ago and was startled to notice that the return or change in price of gold over the last twenty plus years in Swiss franc terms was almost zero.what I mean is that while their is a lost of noise in any long span of price data, if you take the long term change in the price of gold in that currency you get veryclose to the average rate of depreciation of that currency. A very accurate rate of inflation if you will. The reason that you can then verify tis is obviously true is the fixed income markets which are vast in size and therefore more accurate reflectors of free markets than anything else could be. In other words the price change smoothed of a currency when compared to gold gives you a very accurate rate of loss of value in that currency. Ipso facto the fixed income markets will use this base of loss of value as their "initial core"rate of interest to be charged when lending this money and add on the perceived risk rate additions pertinent to this specific currency at that particular time. Take for example the period 1976 through the end of 1998. A period that avoids the obvious distortion of gold in the late sixties and early seventies when it was admittedly artificially help at $42.00 .This period also avoids the recent collapse of the last nine months. The US dollar during this period declined in value by an annual compound rate of 3.97% as gold went from US 124.77/ounce to $294.00/ounce on December 30,1998. The Yen meanwhile went from a Yen price of gold in 1976 of 1,191 yen to the ounce to a yen price at the end of 1998 of 1,238 a rate of decrease annually in value of the yen of 0.18%. The Swiss franc declined by 1.43% annually over the same period. The German mark 2.29% annually, and the Canadian Looney by 5.92% annually. The fixed income and bond markets of course verify this by the relative interest rates charged by the markets in each currency. so like we all have believed the basis of these monies namely gold would quite naturally have a low rate of interest in the various leasing plans. Because after all it is money.What I find very interesting is you last comment:

"I kind of think of Warren Buffet sitting across the table from a major counterparty who is leasing a lot of his silver stash...the counter party says "Mr. Buffet, if you
absolutely insist on getting the market lease rate here, you will drive us out of business very soon and we will be forced to default on the return of your silver...so
please be kind (prudent)and give us a lower rate. Only, the face value of the silver market is like a mouse compared to the elephant gold market...so those who set
the lease rates on gold are forced to keep the rates low even more because default on their gold implies massive cascading defaults in all financial assets worldwide.

CONCLUSION: Lease rates MUST be artificial...and MUST be managed with an eye towards given as many institutions time to slowly unwind books (spread out
the losses over time)."

I hope the above helps point out that maybe the low interest rate charged on gold leasing isn't necessarily too low but that it might be raised in the future to squeeze the very financial wizards who were dumb enough to be borrowers rather than owners. The Smart money then is moving out of the financial mania vehicles that they kited and into the gold as owners that they manipulated. To prosper once again as the over sold try to cover and need to pay whatever lease rate is demanded in order to buy time.

Perhaps the answer to Aristotles "breadcrumb" question about who is buying all the gold is right before our eyes. The only lifeboat that is going to be leaving this
Titantic when she goes down is gold and quite possibly the reason Buffet bought gold and the ECU has now had a public leasing agreement is that the opportunity to exert power over markets as big and diverse as the world currencies markets resides in ownership of gold and being able to control the lease rate the borrowers will have to pay when the bubble breaks. In other words the buyers of gold have been the same sleeze balls who have been manipulating it lower all along. They used the very palpable fear that could be created by hinting that gold was no longer a monetary asset and that the 30,000 tonnes stored in the vaults of the Central Banks would soon be dropping on your heads if you dared to stay long gold. The very rush to finance every peice of moose pasture in the world between 1993 and 1996 was evidence that the ultimate killer of golds value could be real.It could be the venture financing of the heap leaching technology and the various low cost production techniques and bringing them to bear on the new areas of exploration in the formally unstable but now somewhat investable-in countries of the former Soviet Union and Latin America ,This was the process that was about to deal gold the only death blow that it could not survive. ABUNDANCE!
Remember all money must have a low rate of loss of its utility or it is not money any longer. In plainer terms you aren't going to use it as money (a store of value over time )if you are afaid that because of a tremendous flood of it coming in the future it will not hold its value.And since gold has a 50 to one above ground inventory to the amount actually used in fabrication, the risk to it falling significantly if it was demonetized is real.With the fall of the iron curtain and the openning up of the former communist block countries plus the formerly too politically unstable Latin American countries of Peru ,Ecuador,Columbia etc. It became plausable that if the explosion in mining finance that was going on in the early to mid nineties was able to continue then you could have had many new mines with very low cost production flooding the market. The dynamic that was driving that gold production expansion was higher gold prices. The shorts solved that problem thhrough the machinations of the gold carry trade. So now the hyper-inflated paper markets have lost all contact with any level of value and their is still only one lifeboat to get them off the boat.
Of Course in this situation those that do understand the dynamics of the market are going to diss those of us harping about their actions on the internet and elsewhere.

It's their store of value ,they stole it fair and square and they don't want any gold bugs messing with it.

So Aristotle there you have your buyers.
This one's a head case.

Galearis (12/13/99; 9:09:53MDT - Msg ID:20886)
Where's the Buffet spike?
So far the only thing I see are significant jumps in the 6 mo. and 1 yr. lease rates for Ag just today. We should be seeing some spot price action, but I only see a significant climb in lease rates starting last week and dismal trading action. There is no sign, save this lending rate climb, for a significant "shadow spike" affect from the Buffet purchase.

With only 9 months of above ground silver supplies remaining at a price reflecting 600 year lows, is there anyone out there who doesn't believe that there will be massive defaults when the piper must finally be paid. The only explanation I come up with in this present reality is that a whole lot of short folks are not worried - they don't intend to pay the piper! Could "they" are in so deep that they will dead market this puppy and hope that Y2K will be a bail-out for their situations. (But why would this crowd believe in a Y2K deflation any more than the 98% out there that do not believe there will be any computer date problems?)Here we have silver approaching a dead market condition and yet the "price" (not the "worth") sits like a road kill on a country lane.....

USAGOLD (12/13/99; 8:53:19MDT - Msg ID:20885)
Today's Market Report: Monday, Monday
MARKET REPORT(12/13/99): Gold is unchanged as we put this morning's
report together after a relatively strong overnight market. At the open,
gold was about $1.50 higher than Friday's close and then fund selling
came in to drive it back down. The London market traded about $1.80
higher than Friday's NY close but described as featureless, for the most
part, with dealers complaining about the thin, quiet trading. Tokyo
reports light short covering, but an essentially featureless market as
well. All in all it looks like a typical Monday morning.

As for the gold news today, in the For What It's Worth Department, the
Russians announced on Friday that they will keep their gold reserves at
the same levels as this year -- which could mean just about anything.
The Russian reserves are not enough to pose a real threat to the gold
market even if they disposed of all they claim to have. The London
Bullion Market Association reported a significant drop in its gold
turnover -- down 9.7 million ounces from 37.2 million to 27.5 million.
The drop probably reflects the cool-down in the carry trade business
after the September agreement among European central banks that they
would limit sales and leases of the yellow metal.

That's it for today, fellow goldmeisters. We'll see you here tomorrow.

Christine (12/13/99; 8:50:13MDT - Msg ID:20884)
CIA
Many bad "special ops" CIA agents hang out here. Some of you, on the other hand, are just in way over yer heads and don't realize it.

Agent "Chris"--CIA Liason Officer

nickel62 (12/13/99; 7:56:48MDT - Msg ID:20883)
By the way that is the ame reason why the Nazis never invaded Switzerland!
They needed an escape route if they should loose the war. Flights to Argentina and Paraguay, transfer of wealth etc.

nickel62 (12/13/99; 7:49:53MDT - Msg ID:20882)
Solomon Weaver I read with interest your post on leasing rates and I think I have a few thoughts that might help.
I was reading a table of gold prices in deveral different currencies sevral years ago and was startled to notice that the return or change in price of gold over the last twenty plus years in Swiss franc terms was almost zero.what I mean is that while their is a lost of noise in any long span of price data, if you take the long term change in the price of gold in that currency you get veryclose to the average rate of depreciation of that currency. A very accurate rate of inflation if you will. The reason that you can then verify tis is obviously true is the fixed income markets which are vast in size and therefore more accurate reflectors of free markets than anything else could be. In other words the price change smoothed of a currency when compared to gold gives you a very accurate rate of loss of value in that currency. Ipso facto the fixed income markets will use this base of loss of value as their "initial core"rate of interest to be charged when lending this money and add on the perceived risk rate additions pertinent to this specific currency at that particular time. Take for example the period 1976 through the end of 1998. A period that avoids the obvious distortion of gold in the late sixties and early seventies when it was admittedly artificially help at $42.00 .This period also avoids the recent collapse of the last nine months. The US dollar during this period declined in value by an annual compound rate of 3.97% as gold went from US 124.77/ounce to $294.00/ounce on December 30,1998. The Yen meanwhile went from a Yen price of gold in 1976 of 1,191 yen to the ounce to a yen price at the end of 1998 of 1,238 a rate of decrease annually in value of the yen of 0.18%. The Swiss franc declined by 1.43% annually over the same period. The German mark 2.29% annually, and the Canadian Looney by 5.92% annually. The fixed income and bond markets of course verify this by the relative interest rates charged by the markets in each currency. so like we all have believed the basis of these monies namely gold would quite naturally have a low rate of interest in the various leasing plans. Because after all it is money.What I find very interesting is you last comment:

I kind of think of Warren Buffet sitting across the table from a major counterparty who is leasing a lot of his silver stash...the counter party says "Mr. Buffet, if you
absolutely insist on getting the market lease rate here, you will drive us out of business very soon and we will be forced to default on the return of your silver...so
please be kind (prudent)and give us a lower rate. Only, the face value of the silver market is like a mouse compared to the elephant gold market...so those who set
the lease rates on gold are forced to keep the rates low even more because default on their gold implies massive cascading defaults in all financial assets worldwide.

CONCLUSION: Lease rates MUST be artificial...and MUST be managed with an eye towards given as many institutions time to slowly unwind books (spread out
the losses over time).
Perhaps the answer to Aristotles "breadcrumb" question about who is buying all the gold is right before our eyes. The only lifeboat that is going to be leaving this
Titantic when she goes down is gold and quite possibly the reason Buffet bought gold and the ECU has now had a public leasing agreement is that the opportunity to exert power over markets as big and diverse as the world currencies markets resides in ownership of gold and being able to control the lease rate the borrowers will have to pay when the bubble breaks. In other words the buyers of gold have been the same sleeze balls who have been manipulating it lower all along. They used the very palpable fear that could be created by hinting that gold was no longer a monetary asset and that the 30,000 tonnes stored in the vaults of the Central Banks would soon be dropping on your heads if you dared to stay long. The very rush to finance every peice of moose pasture in the world between 1993 and 1996 was evidence that the ultimate killer of golds value could be real i e that low cost production techniques and new areas of exploration in the formally unstable but now somewhat investable in countries of the former Soviet Union and Latin America , wher about to deal gold the only death blow that it could not survive. ABUNDANCE! It was plausable that if the explosion in mining finance that was going on in the early to mid nineties was able to continue then you could have had many new mines with very low cost production flooding the market. The dynamic that was needed for that was higher gold prices. The shorts solved that problem thhrough the machinations of the gold carry trade. so now the hyper inflated paper markets have lost all contact with any level of value and their is still only one lifeboat to get them off the boat. Of Course in this situation they who do understand the dynamics of the market are going to diss those of us harping about their actions on the internet and else where. Its their store of value they stole it fair and square and they don't want any gold bugs messing with it.

So Aristotle there you have your buyers.

JCS (12/13/99; 7:02:41MDT - Msg ID:20881)
YGM (12/13/99; 1:31:52MDT - Msg ID:20872)
You wrote: "Chris....cripesakes get grip girl.....this CIA crowd has the most even keeled thoughts on
the web....real people and real education not to mention reality itself lives here.....YGM"

YGM, et al

This one's a head case.
Delving into the dark side of spiritualism has finally taken its toll on her/him/it.
Wait 'til the posts start coming from her/him/it regarding specific instructions given by the goddess venus and others. Over at Kitco forum the posts get totally bizzare.
Best case is just let is go and don't respond. That's just pouring fuel on the fire.
All given IMHO.

Silver Tongue (12/13/99; 6:23:57MDT - Msg ID:20880)
y2k
The Y2K thoughts this morning were pretty convincing and pretty sobering; not that I drink anyway. The wisdom of having food, water, yellow and silver will soon all become apparent; despite the poo poos of my brethren at work who subscribe to the economic burb theory rather than to the plague theorty of Y2K. Now all I have to do is get my loin cloth and club and charcoal writing implement. I hope that we survive Y2K, but in my heart of hearts, this is going to be grim under anyone's definition.

Canuck (12/13/99; 6:06:37MDT - Msg ID:20879)
HLime
Thanks for finding and posting. Anyone sitting on the fence
may have a reason to get off.

To anyone sitting on the fence, Y2K is a 50%/50%, why take the chance?

Christine (12/13/99; 6:05:02MDT - Msg ID:20878)
@YGM, old buddy
Any good CIA guys (and gals) can come on over to Kitco

Agent "Chris", CIA Liason Officer

HLime (12/13/99; 4:53:27MDT - Msg ID:20877)
MK and all.
My old boss used to say "it is easier to beg forgiveness than to ask permission".
It is early on a Monday AM and these two posts are important to the Y2K
debate. Yes I could of paraphrased parts and posted a link but not all readers
would of followed along. These articles by Infomagic are the reason I converted
most of my wealth to Au/Ag and am stockpiling food and fuel.

It is very late to do much of anything to prepare. If either of these articles
convince you of what may be coming, then perhaps all Info is doing is
pissing in your eggnog. Go back to sleep.

Harry

HLime (12/13/99; 4:35:19MDT - Msg ID:20876)
Infomagic part II, read at your own risk.
cory hamasaki's
DC Y2K Weather Report
November 27 1998 - 399 days to go. WRP103 V2, # 47
Draft $2.50 Cover Price.

(c) 1997, 1998 Cory Hamasaki - I grant permission to distribute and
reproduce this newsletter as long as this entire document is reproduced
in its entirety. You may optionally quote an individual article but you
should include this header down to the tearline or provide a link to the
header. I do not grant permission to a commercial publisher to reprint
this in print media.
--------------------tearline -----------------

Preface -- Who is Infomagic? --

No one knows but based on his comments on computers, large systems, and
programming, Infomagic has substantive, serious expertise. In addition,
there are multiple dimensions to his experience set.

While this is not a formal proof of correctness for his dark
projections, Infomagic has a strong technical basis upon which to build.

Please, take the time to consider the following offering.

Assessment -- Infomagic --

SET RECOVERY ON
PART 2: THE DEVOLUTIONARY SPIRAL
by
Y2000@Infomagic.com

In the first article of this series I predicted that the failure of even
a small number of our computer systems, combined with fundamental
problems already existing in the global economy, will lead to the total
collapse of civilization as we know it. I would now like to expand on
that and show you that collapse is probable even in an unreasonably
optimistic best case scenario in which _all_ of the systems are fixed
before 2000. In any of the more realistic scenarios this collapse is
absolutely certain. I would also like to explain just how devastating
that collapse will be and to show that recovery in our lifetimes is an
extremely unlikely outcome. We must prepare for a dark period of
several generations during which much of our technology and knowledge
will be lost and after which there _may_ be a slow recovery by our
descendants. Such preparations are the subject matter of this series of
articles. However, we must also prepare ourselves for the very real
possibility that the outcome of this situation might well be the total
extinction of the entire human race. It really _could_ be worse than I
am predicting and I really _am_ being optimistic.

First, I would like to assure you that I am not some kind of nut
anxiously waiting for the end of the world. I am a professional
computer consultant with 30 years of extensive, hard won experience in
many different areas of information technology. I have programmed at
the lowest machine code level on everything from small embedded systems
all the way up to the largest mainframes. I have co-invented computer
hardware and developed novel solutions to very complex problems. I have
designed and implemented _very_ large scale business computer systems
and I have planned and managed the creation and growth of entire
mainframe data centers. I have also worked at a senior level in some of
the best consulting organizations in the world. In short, I am a super
geek, with an extensive real world and management background beyond the
art of computing itself.

I have been aware of the Y2K problem for at least 20 years, and actively
working on it for about three. Until the beginnning of 1998 I believed
that the problem could still be mostly fixed and I have always been
skeptical of the wilder claims of potential Y2K failures. For example,
as an airline and instructor rated pilot (my secondary career), I
_don't_ believe that airplanes will fall out of the sky. However, I am
quite certain that many, if not most, large commercial aircraft will
indeed be grounded -- by shortages (and higher prices) of fuel, by
crippled Air Traffic Control systems and by the lack of sufficient
general economic activity to justify their continued operation. Unlike
the bulls and pollyannas, I am not fixated on the success or failure of
individual systems. I have the capacity to see the larger picture and I
am _far_ more concerned with the total failure of Charlotte's Web itself
-- that system-of-systems which forms the backbone of modern
civilization.

I freely admit that many of my colleagues disagree with my conclusions
and believe that Y2K will be nothing more than a "bump in the road".
The problem is that, speaking as an expert, I have _never_ seen any
_credible_ evidence to support their general position. Yes, they can
point to individual successes, but this does not materially support
their overall hypothesis of "no problem" and we (the bears or
"doombrood") can point to far more failures, far more known problems,
and the abysmal record of our own industry in meeting deadlines and
required functional capability. In addition, I must point out that the
disaster scenario requires the failure of only a relatively small
percentage of our systems (let's say 20%) while the "bump in the road"
scenario requires virtually perfect correction of almost all affected
systems, all on time and all on budget. For the bulls to be right, we
must somehow magically move from a historical on-time project success
rate of less than 15% to a success rate for Y2K projects of at least
90 - 95%.

Such a position is clearly irrational. However, for the sake of
argument, let us go even further and assume that all affected systems
will indeed be fixed before they start to fail. Unfortunately, this
would _not_ solve the problem or prevent the disaster. You see, after
any major maintenence change to a system (which Y2K most certainly is)
there is always a residual rate of failure as a result of the changes
themselves, _even_ when the changes are properly "tested". The failures
manifest themselves when the system is placed back into the real world
of "production", as opposed to the artificial world of "testing". They
happen because maintenence programmers customarily test only the
immediate effects of their changes. There is neither the time nor the
money nor often even the ability to test the entire consequences of a
particular change to a system. The residual failures typically arise
_elsewhere_ in the system, at some point unrelated to the change itself
and completely unanticipated by the programmer.

This last is why residual failures are so hard to identify and correct.
Often, we can't even tell for certain whether a particular failure
really is the result of a recent system change or not. In turn, this is
why a good system administrator would _never_ return two or more systems
to "production" at the same time. Not only is the risk of failure
almost doubled, but there is also a small chance of _both_ systems
failing simultaneously. For Y2K, the problem is greatly compounded by
the fact that, essentially, we will be placing _all_ of our corrected
systems back into "production" at roughly the same time. We can even
calculate the magnitude of the residual failures, to a first
approximation.

The actual rate of residual failure depends on a number of factors, but
mostly on the size of the system and the scope of the changes. Under
average conditions, modest changes to a moderately sized system, the
rate would be about 7%. The scope of Y2K changes is, of course, much
more extensive than this and many of the systems are extremely large, so
the residual failure rate is also likely to be higher. Nevertheless,
for the sake of argument, let us again assume an overly optimistic
residual failure rate of only 5% for Y2K related changes. But this is
only for one system. For a business with multiple systems (which they
all have) the chance of a system failure can be computed as:1-(1-f)**n,
where "f" is the failure rate and "n" is the number of systems.

An average small business would have perhaps 5 systems so, assuming a
residual rate of 5%, they have about a 23% chance of at least one system
failure (1-(1-.05)**5 = 0.226). A medium size business would typically
have about 25 systems and, therefore, a 72% chance of a failure
(1-(1-.05)**25 = 0.723). A large business with 100 or more systems
would have a 99% chance of a failure (1-(1-.05)**100 = 0.994). This is
EVEN IF ALL OF THE SYSTEMS ARE FIXED! Of course, many of these failures
will be relatively easy to fix, but others will require an effort beyond
the capabilities of the business and they will _not_ be fixed before the
business itself fails (this is particularly true for small and medium
businesses using packaged software). In addition, the great majority of
these failures will have at least some domino effect on related
customers and vendors. To make it even worse, virtually _everybody_
will be facing these problems at about the same time, leading to a chaos
in which actually fixing the problems becomes almost impossible. At the
very minimum this will lead to an economic disaster, JUST FROM THE ACT
OF FIXING THE SYSTEMS THEMSELVES, without even taking into account the
effect of the unfixed systems, of embedded systems or of an already
declining global economy.

In reality, of course, the situation is _much_ worse than this, and the
residual failure rate will be much, much higher. Just how much worse is
anybody's guess since we have, as yet, insufficient historical data of
actual Y2K failures. One thing I can state, categorically, is that a
"bump in the road" is not even on the scale of possibility. As we have
seen above, the best case end of the scale really _begins_ with a global
economic disaster and even then assumes that all systems are fixed on
time and that there are no outside factors such as a global recession.
Clearly this, too, is an untenable position.

So, in a realistic best case, how much worse than an "economic disaster"
is it going to get? Let's use the same formula but this time with a
guesstimate of the rate of _critical_ failures (those likely to lead to
a failure of the business itself). As an expert, I personally think
that the overall, critical failure rate will be between 10 and 20% but,
again, let's be overly optimistic and say that only _1%_ will fail
critically and terminally for the business. Even this means that 5% of
small, 22% of medium and 63% of big businesses will, inevitably, cease
to exist as a direct result of Y2K system failures. Interestingly,
these numbers accurately reflect our intuitive grasp of the increasing
dependance on information technology as businesses grow larger. But the
exact numbers don't really matter because this is only the _first_ level
of failure.

The second stage of failure is the "domino effect", the
interrelationships between vendors and their customers. Roughly
speaking, each of the big three auto manufacturers has about 50,000
vendors of whom about 10,000 are "critical" to production. On the basis
of the above, at only a 1% critical failure rate, at least 500 of the
critical vendors (5%) will go out of business, forcing the production
line to a halt. If that happens for any extended period of time then
most of the other 49,500 vendors are basically out of business. Not
that it matters. On the basis of the above, two of the big three (63%)
will _themselves_ go out of business because of their own Y2K failures,
taking most of their vendors with them. Not that it really matters.
50% of the big three's customers are employed by small businesses, of
which 5% will immediately go out of business. Unfortunately, the other
50% of their customers are employed by medium and large businesses of
whom, optimistically, (63-22)/2+22 or 42% will also go out of business,
removing their former employees from the auto market. Those who still
have jobs will also be much less likely to buy and, with this immediate
and increasing drop in sales, _all_ of the big three will effectively go
out of business -- together with most of their vendors. The same thing
will happen in every other segment of the economy as well.

Even with unrealistically optimistic numbers, and without taking either
embedded systems or the already poor global economy into account, I
think this proves beyond any reasonable doubt that Charlotte's Web will
indeed completely collapse, just as I predicted in the previous
article. Unfortunately, that is still only the _second_ level of
failure.

The _third_ level of failure is something I call a devolutionary spiral
-- the unwinding of everything we have built over the last 2,000 years
of civilization. It is a continuing, self perpetuating, reduction in
global population, economic activity and technical capability. It has
many of the characteristics of a deflationary spiral in economics; of
the entropy of a closed thermodynamic system; and of the sudden jump to
a lower energy level which we see in the decay of many nuclear-physical
systems. Historically, it is much like the fall of the Roman Empire,
which collapsed under it's own weight far more than from outside
factors, and from which "recovery" took over 1,000 years. I don't yet
know how to measure the spiral, scientifically, but I do know how to
describe it.

The key is something called "carrying capacity", a term from the
biological sciences. It defines the maximum population of a given
species which a particular habitat can support under a specified set of
circumstances. If the maximum population is exceeded, or if the
capacity itself is reduced, the inevitable result is always a reduction
in the population to a level far lower than the simple difference in
population numbers would suggest. As an example, consider the plight of
the beautiful Mule Deer of the Kaibab Plateau, close to my home in
Northern Arizona. Several years ago, the greenie meanies manipulated a
ban on the hunting of Mule Deer in this area. Until then, hunting had
been used to control the deer population, with the permitted "harvest"
designed to reduce the total number of deer, swollen by springtime
breeding and summer plenty, to the maximum number which could be
supported through harsher winter conditions. As a result, the year
round population of deer was normally at it's theoretical maximum for
that particular habitat.

Without hunting, the first snows found the herd 25% larger than the
winter carrying capacity. At first, the poor deers just lost weight,
competing with each other for a food supply far below that needed to
support them all through the winter. As the winter progressed, however,
the weaker deer (does, fawns and the old) quite naturally died -- by
their pitiful thousands. But, worse than this, even the stronger,
dominant males were weakened to the point that they, too, succumbed in
higher numbers than usual. By the next spring, the Kaibab deer herd was
reduced to less than 50% of the normal, springtime population and there
were fewer new fawns. In the fall, there were less dominant males and
less healthy does, to take care of building the new population. It took
decades to recover to normal levels (and then only with the resumption
of controlled hunting).

I am personally sickened by the images of this event, by the triumph of
"emotion" over "reason", but that is not the point I wish to make. The
point I _must_ make is that we, ourselves, are really not that different
from the Kaibab deer herd. We live in a complex, computer dependent,
world with a carrying capacity of about 6 billion souls. Take away some
of the computer capacity, as little as 10%, and we lose a significant
portion of the carrying capacity. Because of the domino effect, if we
lose just 10% of our businesses (and even the government expects more)
this could easily translate into a loss of one third of the carrying
capacity and, thus, 2 billion dead.

But that's just the beginning of the devolutionary spiral. Unlike those
Kaibab deer, we human beings are to a large extent responsible for
creating our own carrying capacity. Without our complex society there
is no way this earth could support or carry 6 billion people. But,
conversely, without 6 billion people there is no way we could create
such a complex society in the first place. When we lose a significant
percentage of the population, which we certainly will, we will also lose
an important part of our ability to maintain civilization itself. As a
result, we will lose even more of the carrying capacity and even more of
the population. Once the spiral starts it feeds on itself and it
_cannot_ be stopped by anything we do. It will stop, all by itself, but
only when a new equilibrium is reached with a much lower carrying
capacity and a much smaller population, with far less economic activity
and more limited technology.

It doesn't matter whether you believe me. It doesn't even matter if I
am right. Because you are not the only one reading this article.
Through the magic of the internet there are thousands, perhaps millions,
who are also reading and who do believe. There are millions of others
who have found similar opinions elsewhere and who also firmly believe
it's really coming, really soon, to a town near them. They believe it
is serious enough that they have already decided to withdraw their money
from their banks and mutual funds. When that happens en masse, some
time next year, our entire economy will collapse. In a sense, the end
has already begun and the spiral has already started to unwind.

There is nothing _wrong_ with their decision, even though it will indeed
trigger the very collapse they are trying to protect themselves
against. The point is that Y2K is real, the global recession is real.
Roosevelt was wrong. We really do have something more to fear than fear
itself. It makes sense to prepare. It is sheer folly to ignore Y2K and
those who do so will be numbered among the dead. The sensible question
is not whether to prepare but how to prepare and for what. The
remaining articles in this series will cover the how, for the moment I
am concerned with the what. I have painted a pretty bleak picture of
the total collapse of civilisation itself and the death of billions.
Using highly optimistic numbers, I think I have shown that this is not
just possible but probable. It makes the most sense to prepare for this
worst case scenario. If you prepare for anything less, and I am right,
you will _not_ be prepared at all and you, too, will be numbered among
the dead.

To drive this point home, I would like you to consider the closest
historical precedent I can think of. The Roman Empire also collapsed in
upon itself, in much the same way that I am predicting. As it
collapsed, the carrying capacity of the empire was reduced and the
population did indeed spiral downwards, reaching a low point several
hundred years later around 1350. Most of their technology was also lost
and their roads, aquaducts, cities and monuments soon fell into
disrepair because none of the survivors understood the Roman
technology. Even if they had, there weren't enough people nor enough
economic activity to justify let alone institute the repairs. Consider
this also. After a 1,000 years there _were_ indeed survivors. They
just weren't Romans.

Five miles from my boyhood home in England are the ruins of a Roman
fort, built in the time of Hadrian to protect the estuary of the largest
local river, and the center of trade and commerce in the area. Today it
is little more than a few piles of rubble, but legend has it that every
year, at midnight on Good Friday evening, the old town comes back to
life for just one hour. As a boy I would sneak out and ride my bike to
the old fort. More than one dark night I spent there, listening for and
almost hearing the ancient sounds, looking for and almost seeing two
thousand year old ghosts from a long dead civilization. I wonder what
little boy will look for us, if we don't prepare.
_______________________________________
Copyright (C) 1998, y2000@infomagic.com

HLime (12/13/99; 4:23:03MDT - Msg ID:20875)
Canuck here it is part one, enjoy.
Cory Hamasaki's DC Y2K Weather Report V2, # 44
"November 3, 1998 - 423 days to go." WRP100
Draft $2.50 Cover Price.

(c) 1997, 1998 Cory Hamasaki - I grant permission to distribute and
reproduce this newsletter as long as this entire document is reproduced
in its entirety. You may optionally quote an individual article but you
should include this header down to the tearline or provide a link to the
header. I do not grant permission to a commercial publisher to reprint
this in print media.

Analysis------------ Infomagic ---------------------

SET RECOVERY ON
PART 1: CHARLOTTE'S WEB

In the mainframe editor that many programmers use to edit their source
code, the command "SET RECOVERY ON" causes the editor to save partial
updates so that, in the highly unlikely event of a mainframe crash, the
work the programmer has done will not be lost. Pollyannas don't use
this command much because they know that mainframes are so reliable they
never fail. Of course, pollyannas occasionally lose hours of work that
has to be done all over again. Pollyannas also say that Y2K isn't a big
problem and our economy is so robust and our programmers are just so
brilliant that we can easily fix any problems that are left. They are
dead wrong, as you will be if you believe them.

Our modern, technological, civilization has all of the strengths and all
of the weaknesses of Charlotte's web. It is strong enough to support
the weight of the spider and to hold it's prey. It is strong enough
that one or two broken strands can be easily repaired and the web can
last for years. But break enough strands and the entire web instantly
collapses, beyond any possible repair.

The strands of the web are the myriad interconnections between each of
the "nodes" of our civilization. We, ourselves, are the nodes, as are
business and non-profit organizations and government agencies (webs
within webs, if you will). Some of the nodes are computer systems with
Y2K problems which will _not_ be fixed before they fail, taking all of
their connected strands with them. In fact, some of the nodes have
already failed (e.g. the credit card and POS terminals which failed in
1997 and _still_ have not been completely fixed almost two years later).
Others will fail in surprising ways next January and still others will
fail, randomly, throughout 1999. More and more strands will fail the
closer we get to New Year's Evil. It is a dangerous blunder of epic
proportions to believe that we have _any_ of 1999 for more remediation
and testing.

So far, we have been able to fix the broken strands, because they are
few and we, the programmers, are many. But at some point, the number of
failures will exceed the number of programmers, and the strands will be
permanently broken. Inexorably, the failures _will_ continue and they
_will_ propagate to the rest of the web, like a run in a nylon stocking.
I have a nasty feeling this will happen quite some time before the great
phalanx of failures on New Year's Evil itself. Even, perhaps, as early
as January 1999.

To understand why the entire web will fail, we must consider a number of
factors. First, look at the consequences of a major system failure. I
remember an incident when a small group of programmers attempted to
extort millions from a large european business, Unilever, by stealing
the current copies of their master files and destroying all the backups.
(One of the group was my successor as Systems Programmer at another
company). They were lucky and got their files back, thanks to police
intervention. Others have not been so lucky. Statistically, when a
medium/large organization has a major loss of IT capability, 50% declare
bankruptcy within a month and fully 90% declare bankruptcy within a
year. Essentially, a major IT failure means the end of the business,
even under the ideal conditions of a fully functional economy, with
readily available capital to borrow for recovery.

Many Y2K failures will be limited in scope to just the few strands with
which they are connected but some will, indeed, cause the total failure
and collapse of the business itself. This in turn will cause more, and
more significant, failures elsewhere in the web. One of the big three
auto manufacturers has more than 60,000 supppliers, of whom more than
12,000 are considered "critical". If just 5% or _600_ of these critical
suppliers go out of business, so does the auto manufacturer and most of
the other 56,400 suppliers. And if you think you can resurrect 600 data
systems, or replace them with manual systems in time to stop the larger
failure then, quite frankly, you are nuts! The failure of a handful of
small suppliers _will_, _inevitably_, bring down _all_ of the major auto
manufacturers, destroying all of their nodes and all of their strands in
the web. And this is only one industry, critical though it is. The web
might be able to survive one or two such failures, but not any more.

At this point, we are no longer talking just about software failures,
we are talking about larger, macro-economic failures throughout the web.
Supplier dependencies exist _between_ industries, as well as within
them. For example, all industries depend to a certain extent on ball
bearings, most of which are produced in Brazil -- a country far behind
the power curve on Y2K and _already_ on the verge of economic collapse
as a result of other factors. Another "supplier" upon which _all_ of
the other nodes are dependent is the banking and finance industry, which
brings me neatly to the next point I want to make.

Y2K is only _one_ of the disasters facing the real-life world wide web
and, perhaps, one of the _least_ significant. Many parts of the world
are already in deep economic trouble. Japan has been in a _depression_
for two years and is now entering an ominous deflationary spiral. Other
parts of Asia are in even more trouble (particularly Malaysia, North and
South Korea and China, but all the rest, as well). The Russian economy
has effectively ceased to exist, and millions are about to die as their
problems are passed on to their German neighbors and financial backers.
Brazil and South America are next and _their_ neighbor and backer is US
(United States). On top of all this we have a grossly overvalued stock
market and, of course, that little problem of "derivatives" and the
exposure of all of the major banks to hedge funds like LTCM.

And _none_ of the bailouts are working. Billions from the IMF, and the
Russian Ruble continues to crumble. Billions lent to LTCM, and they are
_still_ in trouble. Drop Japanese interest rates to 1/2% and there's
still no "interest" in buying from the consumer. Do you know _why_ we
in the US had our last 1/2% drop so soon after the first? Well-informed
rumor has it that the request to Greenspan came from the Federal Reserve
Bank in San Francisco, home of one of the nation's best known banks.
Apparently, if the discount rate wasn't lowered, they couldn't stay in
business . . . But don't single them out just because of their name.
In Japan, nine of the ten largest banks are, basically, insolvent. They
don't have the reserves to do business in Japan, let alone on an
international basis (although in Japan it is "tolerated"). Believe it
or not, many of our own US banks are equally deep in the doo-doo. And
if you _really_ want, I could talk about their Y2K projects . . .

Now, the bulls (pollyannas) will tell you it just isn't so. They will
tell you that lowering already low interest rates is a "good thing" and
will stimulate dropping economic activity (which isn't happening). The
bears (doombrood) say that they won't invest when the return is so low,
and they'll put their money somewhere safe to weather the storm (which
really _is_ happening). The bulls shout that _this_ company promises
they _will_ be Y2K compliant and therefore everything is going to be OK
in _all_ of the other companies and, sigh, WE'RE GOING TO MAKE IT! The
bears ask "where is the independant proof"? and point to the flat out
lies from supposedly honest organizations such as the Federal Aviation
Administration, the Department of Defense, the IRS and the major banks.

For the moment the bulls are winning, psychologically. And that is the
most important to them because they have no true foundation in reality.
It is so easy to convince the idle masses that everything is hunky-dory
as long as they can't see what is really happening to them (and most of
them won't until it is far, far too late). This is why the stock market
is so ridiculously over valued and why it has gained so much since the
drops of September, based upon _nothing_ but the superficial optimism of
the bulls and their utter disregard of reality. But, at some point very
soon, the "bull-shit" stops and the "bear-facts" will be known.

At this point the stock market bubble will burst. I have predicted that
this would happen in the October/November time frame, and I stand by my
words. Shortly after the November elections, I expect some outside
trigger event, probably the devaluation of the Brazilian Real, and the
collapse of their economy. This will be so close to home, and it's
effect on US banks so great, that the bear-fact will be readily apparent
even to the bulls -- the global economy really _is_ in deep trouble and
none of the economic gimmicks are going to work.

However, the market will not just crash as it did in 1929. Trading stop
measures put into place since then will prevent a massive drop all in
one day. Rather, there will be a series of major drops over a period of
several days or even weeks. I expect a two to three thousand point drop
in the DJIA by the end of November, with continued declines throughout
December and early January. It will not be a happy holiday season for
many. Doors _will_ close and jobs _will_ be lost, and the general sense
of depression will weigh heavily on many.

Then, in January '99, we will see a sharp rise in the number of software
failures attributable directly to Y2K. Many will fail because they hit
data event horizons one year into the future, in 2000 itself. Others
because they hit the year-99 special handling boundary (which includes,
but is not limited to, treating "99" as "end-of-file"). Most of these
early failures will be among the tardier members of the pack, including
federal, state and local government agencies. Especially hard hit will
be those who didn't think they had a problem or who decided to "fix on
failure". But some will be among banks who think they have "remediated"
their software and still have "all of 1999 to test". One thing I can
guarantee is that _all_ of these failures will be unxpected, just like
the POS credit card failures, and they will take a great deal of highly
skilled effort to track down and fix.

We may have enough good programmers to fix most of these early problems
but some will undoubtedly cause business failures or interrupt critical
public services. This will be the trigger of the second barrel and the
noise will wake the sleeping giant. Finally, John Q. Public will sniff,
smell the coffee, and suddenly realize that there really _is_ a Y2K
problem. This is when the bank runs will start and prices for survival
items will go up.

We will also see something that has never happened before -- runs on the
mutual funds which have fueled the growing market bubble. Unlike banks,
there are no government guarantees for these investments and there are
no procedures in place to limit withdrawals. Therefore, liquidity must
come from the fire-sale of stocks held by the funds. Effectively, the
small investors will be wiped out overnight, just as they were in 1929.
The market will experience a secondary crash, the largest ever seen.

This is the climate in which we will have to find and fix the _rest_ of
the Y2K problems. A global depression reducing the cash flow of those
businesses trying to remediate, limiting the amount which can be spent
on Y2K. Tax base reductions limiting the resources which government can
spend on their _own_ problems, let alone those of others. A programmer
pool, already too small, further reduced by those who have to work on
the early failures (and the _continuing_ failures throughout 1999). A
banking and finance structure already so badly weakened that it can do
little or nothing to help. A general public on the verge of panic and
in fear of their lives as well as their jobs. Then, in January 2000, it
all gets worse . . .

It is the end of Charlotte's web and the beginning of a downward spiral
in population, technology and business (I will expand on this in the
next article). There is _nothing_ we can do to avert this problem. We
might have been able to fix the computer problem if we had ignored the
pollyannas and started on a massive, co-ordinated effort five years ago.
We might have fixed the economic problem if we had ignored the bulls and
taken the necessary economic steps five years ago. But we did neither,
and now they are both combining, feeding on each other, to give us the
biggest, deepest, disaster in human history (with the possible exception
of Noah's flood).

It is too late to fix Charlotte's web. It is too late even to place
backup strands in the most important places. It is time to SET RECOVERY
ON. We must now make plans and preparations to ensure our own personal
survival and to pass on as much of our technology as we can to our
children. Perhaps, then, some future generation can rebuild what we are
about to lose. Perhaps, even, they will learn from our mistakes.

But we can only SET RECOVERY ON if we plan for the very worst we can
imagine (short of the extinction of the human race). To this end, the
next article in this series will discuss just how bad I think it is
going to get, how deep we are going to fall. The rest will deal with
practical plans for survival, methods of passing on our technology, and
suggestions for making social life easier after reaching the bottom.
_______________
Copyright (C) 1998, y2000@infomagic.com

Aristotle (12/13/99; 3:46:52MDT - Msg ID:20874)
Saving Gold
Hi Netking. I've just been working my way through some of the archives and had put together a post stimulated by the contents of one that you had passed along from Chris at GATA in your post--"Netking (12/09/99; 02:06:10MDT - Msg ID:20624) 'Sheriff' CHRIS of GATA"

What a coincidence finding you in the neighborhood! Anyway, what follows is what occurred to me upon reading Chris' letter:

This statement is the single most powerful and accurate bit of rhetoric ever to cross my path coming out of GATA:

"Never underestimate the power of an informed,
persistent, and well-mannered citizen in our democracy."

Seriously. An informed citizen making a solid appeal to an elected official can acually make some great mileage or headway, whereas someone who comes across as a raving madman is generally dismissed promptly in the interest of saving valuable time. So, in that same spirit of being "informed," can anyone take a look at the phrase that followed the one above, and offer an answer to the question I've posed afterwards? I'm just trying to help stimulate some quality thought here.

"Gold, the integrity it stands for, and the mining industry
have been abused in recent years precisely because
they have declined to fight back against some powerful
interests."

Mining companies fighting back?? Haven't they themselves participated actively in all manner of price-depressant activities (forward sales and other forms of hedging/speculating), thus contributing to their own malaise as part of the problem alongside the "powerful interests"? My question is this--It obviously hasn't been the miners, so who has it been all these years on the "long" side of the Gold equation taking a seemingly endless bath--and why isn't this particular party up in arms over their ever-losing long-side position? Why didn't they form their own GATA-like coalition to stop the years of steady "pain?" If you can answer this, you've cracked the nut and now hold the world in your palm.

Here's a hint--the answer has already been presented at this fine forum. Another hint in regard to the absence of complaints from these phantom longs is to consider their motives. As a small-timer, I'm not limited by their own market-making size when it comes down to the art of the deal (I can buy outright with nary a ripple,) but I do share their mentality. As someone who can see things for what they are, I know enough to choose Gold at every turn as the payment-in-full for my net productivity (gross earnings minus general living expenses). Anyone who can still see clearly through the fog of propaganda knows what a great deal it is for the price of Gold to fall over time--you are able to accumulate your payment-in-full under improved terms. You get more Gold for the same amount of dollars. (Essentially, a pay raise.) So when the price makes its turn upwards (as it must,) the subsequent weight of each following payday conveys an equivalent value in a lighter package, meanwhile, your past savings will grow in value. Someone wiser than the prevailing propaganda will benefit from their clear vision, and will have at all points along the way the security and comfort of real money (Gold) denominating their past excess of productivity. I encourage everyone to follow the trail of breadcrumbs laid out at this forum as clearly as an 8-lane superhighway in order to solve this "Mystery of the Silent Longs" for themselves, and to draw their own conclusions.

On a related note, I see that beesting has come up with a catchy sign-off phrase that speaks volumes: "Those in the know.....buy Gold." Well done, ol' friend!

Gold. Get you some. ---Aristotle

Netking (12/13/99; 3:09:13MDT - Msg ID:20873)
Christine
Christine; You don't know anybody by the Global 2000 Operative code name name 'Stanger' now do you?

YGM (12/13/99; 1:31:52MDT - Msg ID:20872)
Canuck..../Chris....
It's Awful Nice When Others Show Support...
or pick up,the ball and run w/ it......I'm awful sick of looking at YGM feeling like 'ygm' and blowing a horn.....Gata or Bankers or Y2k or whatever....the fight & payback has waited most of a lifetime........Nothin to lose here......YGM.

Chris....cripesakes get grip girl.....this CIA crowd has the most even keeled thoughts on the web....real people and real education not to mention reality itself lives here.....YGM

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