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ARCHIVED DISCUSSION FROM 1/14/2004 All times are U.S. Mountain Time (Yesterday's Discussion.) specie-man (1/14/04; 23:55:19MT - usagold.com msg#: 115367) cold weather Not here.We shipped it back east.It has been over 60 degrees for the last three days here in north central Colorado.So, at least, my heating bill isn't going up right now.Payback time for us is usually in the spring, though. Black Blade (1/14/04; 23:49:50MT - usagold.com msg#: 115366) specie-man - Rubin Yep, he's CEo of Citibank. A nice payoff for favors rendered perhaps.- Black Blade Black Blade (1/14/04; 23:48:09MT - usagold.com msg#: 115365) Consumers face rising energy costs http://www.contracostatimes.com/mld/cctimes/business/7706435.htm Snippit:The already high cost of staying warm in Northern California soon is likely to rise even higher, according to PG&E Corp., this region's largest utility. The regulated retail price of natural gas, the main fuel used for heating here, is currently 72 cents a therm for PG&E customers, up 24 percent from a year ago, when it was 58 cents. In December, the price was 69 cents a therm. Higher prices, combined with increased natural gas use, have dramatically hiked customers' bills, according to PG&E. It estimates that the average residential tab for natural gas in January was $91.56, up 15 percent from a year ago, when the average bill was $79.81. In December, the average bill was $72.22. And things could get worse. "There is a significant chance that natural gas prices will be higher in February for PG&E's residential customers," spokesman Jason Alderman said in a release. "All the signs are pointing to higher" prices, he added in an interview. Colder-than-normal conditions in the Northeast have driven up demand for natural gas for heating, and higher prices for natural gas and oil have rippled throughout the nation, he said.Black Blade: That's nothing! Look at any weather map and see what's happening in the US northeast! An Artic Blast is hammering the Midwest to northeast with sub zero temps on the way. So much for Global Warming. February is usually the coldest month and more Artic express blasts are expected. No need to worry though as energy isn't counted in the "core rate" of inflation. ;-) specie-man (1/14/04; 23:42:43MT - usagold.com msg#: 115364) Former Treaury Secretary Rubin Doesn't he work for some big bank now ?It would probably not be in the bank's interest to see the real value of all their assets (loans to customers) inflated away.Banks generally hate inflation - because customers borrow money and pay it back later with inflated (devalued) Dollars. So I can see why he would say what he did. Black Blade (1/14/04; 23:37:52MT - usagold.com msg#: 115363) US shatters record annual trade deficit http://story.news.yahoo.com/news?tmpl=story&ncid=1203&e=2&u=/afp/20040114/bs_afp/us_economy_trade&sid=96001027 Snippit:WASHINGTON (AFP) - The United States is plunging deep into a record trade deficit for 2003, data showed, but unexpectedly bright November figures raised hopes for the year ahead. With 11 months of 2003 counted, the US deficit amounted to 446.81 billion dollars, seasonally adjusted, already breaking the full year record of 418.04 billion dollars in 2002. The deficit with China accounted for a quarter of the gap, amounting to a staggering 114.09 billion dollars for the first 11 months of 2003 in raw, unadjusted figures. In November alone, however, the US trade gap unexpectedly narrowed 8.6 percent from the previous month to 38.01 billion dollars, Commerce Department figures showed. It was the smallest monthly shortfall since October 2002. Analysts said the weaker dollar was making foreign goods costlier to import and US goods more affordable for overseas buyers. Black Blade: Don't get excited now – these deficits are cumulative! We in the US are the largest debtor nation for a reason. The US dollar is still too strong and jobs and industry in fleeing offshore. Black Blade (1/14/04; 23:30:14MT - usagold.com msg#: 115362) Former Treasury Secretary Robert Rubin is concerned about what he calls a loss of fiscal discipline in Washington. http://msnbc.msn.com/id/3948923/ Rubin warns of a deficit's ripplesEx-Treasury sec'y urges fiscal responsibilitySnippit:As one former Treasury secretary made waves Tuesday with his critical account of life in the Bush administration, another warned of a potentially disastrous financial crisis brought on by rising federal budget deficits. Robert Rubin, Treasury secretary under President Clinton, warned of a "very substantial" risk that continued high budget deficits could bring on a cascading series of economic and political problems including rising interest rates, a falling stock market and a sharp decline in the value of the dollar.Black Blade: Interesting that Rubin would show his face as he is part of the problem to begin with. The Clinton-Rubin "strong dollar policy" helped bring us to this mess to begin with and only exacerbated the problem. specie-man (1/14/04; 23:22:50MT - usagold.com msg#: 115361) Selling precious metals for the wrong reason It seems that the announced November US trade deficit was "only" 38 billion rather than the predicted 41 billion.This appears to be what has precipitated a sell-off in metals (and a stonger Dollar).But the fact is, the 2003 trade deficit is a record, by far, for any calendar year. And November's lower than expected number (if accurate) is due to China's recent Dollar spending spree in the US - they're buying aircraft and commodities.Should Asians' spending sprees increase in 2004, that would reduce the trade deficit, but it would put upward pressure on US inflation. And ultimately, the "rocket fuel" required for any precious metals price explosion is strong inflation.I believe the trend will continue. Asians will increasingly channel their excess dollars into US goods and commodities rather than US bonds and equities.So the fact that China went on a mini spending spree for some tangible items is actually bullish for gold, in my opinion.But the gold market traders don't seem to see it that way right now.They're also ignoring the Fereral Government's huge deficit spending with no relief in sight - and now Bush's "space race" added to the spending pile. (Actually, I'm in favor of space exploration).So I guess this dip will be a good buying opportunity. How long will the dip last and how deep will it be ? Someone out there who has the strings to pull might know, but not me. If I had to guess, I'd say one or two weeks and 5%-8%. Then upwards again. Black Blade (1/14/04; 23:19:34MT - usagold.com msg#: 115360) Market Wrap Up - Hartman http://www.financialsense.com/Market/wrapup.htm Snippit:If all currencies devalue it will be highly inflationary. The U.S. dollar still needs to fall the most in order to correct our trade deficit and our federal budget deficit. Things we need and use will cost more in all currencies, not just more in dollars. They can expand the supply of all fiat currencies by 5%, 10% or 20%. I would sure like to see them expand the above ground inventories of gold and silver by 10%. It's physically impossible! More fiat currencies and basically the same amount of precious metals means much higher gold and silver prices along with commodities. Prices are going to move higher for everything, it's just not here yet.The CBS MarketWatch headlines read, "U.S. producers paying more for inputs. PPI up 4% in 2003 on energy costs; core rate rises 1%." The 4% rise in 2003 is the biggest calendar year increase for the Producer Price Index since 1990. While the increase of 1% doesn't seem like much to the core rate, it is the fastest increase in over two years. But there is no inflation!In 2003 finished energy prices rose 11.5% and finished food prices rose by 7.7%. Now you know why inflation statistics are usually stated "excluding food and energy." They are probably the two biggest things we use every day. But there is no inflation!Core crude goods prices (goods at the beginning of production or "inputs"), excluding food and energy jumped 3.4% in December. Gasoline prices went up 5.1% in December and overall energy prices rose 1.8% for an annualized rate of 21.6%. The Labor Department said the cost of fresh and dried vegetables jumped 20.7% in December. But there is no inflation!Tomorrow we will get the most recent numbers for the Consumer Price Index. With creative accounting and hedonic indexing (statistical manipulation) I will just have to guess that, "There will be no inflation."Black Blade: Agreed!!!! But heck, who really needs the unimportant things like food, energy, and housing anyway. We can simply "wish them away" an all is OK. No wonder government workers are the dregs that the US educational and ethical society has to offer. Black Blade (1/14/04; 23:08:50MT - usagold.com msg#: 115359) $350 an ounce Gold – A Magic Number? Steve Forbes and Larry kudlow say so - Ha! Lately many of us heard that some so-called financial experts believe that gold at $350 an ounce is some magical number that indicates that the economy is doing just right and the monetary supply is in perfect balance. Steve Forbes (a babe born with a golden spoon in his mouth) and Larry Kudlow (the resident CNBC buffoon with sidekick James Cramer aka "The Heckel and Jeckel Show") have been two of the most vocal in this regard. What makes $359 an ounce gold some magical number? Apparently no one including these clowns don't know either. They obviously did not take inflation into account and that gol was regulated in an artificial environment for several decades when illegal for US citizens to own in supposedly a "free country". Why not $250 an ounce or $1,000 an ounce? Why $350 an ounce? A case in point. In the Forbes December 8th 2003 issue of Forbes in Steve Forbes editorial entitled "Will Fed Flood Drown Investors?", Steve Forbes claims that the "Federal Reserve is planting the seeds for future inflation". Well no kidding! When did he figure that one out? We knew that years ago. Of course the mighty Forbes fell for the "Deflation" argument caused by the central bank argument that supposedly started in the late 1990's and ended last year. He says: "The Fed, in short is printing too much money, We won't feel the full shock until after next year's elections." Sorry Stevie boy, but the problem is thsat the Fed is not printing enough "money" and the US dollar is still way too strong to compete in the global market place with pegs and currency interventions after many nations have long given up on the "free economy" to determine "fair value". The only game in town left for the US is to print money like there's no tomorrow as we a cannot peg or intervene in the global currency markets like most everyone else. He further claims that Fed Chairman Alan Greenspan's guilty of malpractice and there is where any agreement between Stevie Boy and myself end (but for different reasons). He goes on to say that "the symptoms of an oncoming inflation are abundantly clear. Commodity prices have soared. The best barometer of monetary disturbance is, gold is now reaching $400 an ounce (where has he been as it surpassed that level earlier), the highest level since 1996. The average gold price for the past decade has been roughly $330. If the Fed was doing its job right, the price would be around 4350 an ounce toay. Investors should pay close attention to the yellow metal. If it breaches $400 an ounce and stays there, this bull market will morph into an unpleasant bear by 2005." Well what makes him such an expert on the price of gold and the US dollar. Sorry, but the US dollar is grossly overvalued in a "competitive currency devaluation" caught in a "currency war" where few if any are playing fair but for economic survival of a shrinking economic piece of the global consumer pie. Accounting for inflation and artificial gold price controls, I would venture that gold should be at a minimum of $650 an ounce and more likely much more given the rise of the global population and the available above supply of gold (maybe the price should be much more because no one really knows for sure if the above ground gold in central banks really even exists. Even the US Congress has refused along with Treasury to have an independent audit of Fort Knox and West Point Gold as have the central banks of most every other country on the planet. Add o this the fact that as the world population grows mining supply is in decline and set to decline much further for several years. So what makes Stevie Forbes and Larry Kudlow (aka "Heckel") experts in what should be an appropriate price of gold as a gauge to determine US dollar inflation? Nothing at all makes them so-called "experts". They simply pulled this number out of their rear ends without giving any thought to supply-demand fundamentals and what makes gold (or silver, or platinum, or oil, or wampum, or whatever) as a "fair price" to judge inflation. Several other so-called "experts" who have devoted much more time and analyses to the value of gold (and other metals and commodities) come to much different conclusions with much higher values. Amazing what silliness these clowns can pull out of their butts and shove down the throats of gullible readers and listeners without providing one iota of proof or reasoning for what a "fair price" of gold is compared to US dollars under "ideal conditions". That is if this gold even exists in these central banks that refuse to audit their holdings or make such holdings public information backed up by independent audits. -Black Blade Goldilox (1/14/04; 23:04:48MT - usagold.com msg#: 115358) Debtberg, Hoooo! - Doug Noland's Credit Bubble Bulletin - PruBear http://www.prudentbear.com/creditbubblebulletin.asp snippit:"Bloomberg tallied $26 billion of debt issuance this week, "the most since last January." "Investment banks and financial firms paced companies that brought $12.6 billion in issues to the market Tuesday, the most in one day in about a year." Investment Grade issuers included Goldman Sachs $4.0 billion (up from $2 billion), Morgan Stanley $3.5 billion (up from $2 billion), Credit Suisse FB $1 billion, HBOS $1 billion, Southern California Edison $975 million, New York Life $500 million (up from $300 million), Monumental Global Fund $550 million, Nova Chemicals $400 million, Paxson Communications $365 million, Pacific Life $300 million, Fifth Third Bank $250 million, FGIC $250 million, John Deere Capital $200 million, Enbridge Energy $200 million, D.R. Horton $200 million, Principal Life $150 million, and Indianapolis Power & Light $100 million.Goldilox:I can't add that high without starting a migraine. $26 BILLION in one week is a whole lotta money! And poor IPL has to make do with a measley $100 mil! Goldilox (1/14/04; 22:56:31MT - usagold.com msg#: 115357) Mid-week analysis - PruBear http://www.prudentbear.com/midweekanalysis.asp snippit:"One news story that probably got lost with everyone focused on earnings was a study conducted by the Henry J. Kaiser Family Foundation and Hewitt Associates. According the study retirees will be left shouldering much of the increase in healthcare costs. Ten percent of respondents said they terminated benefits for future retirees last year and one in five companies may eliminate it in the next three years. Additionally, 71% said they passed a larger share of the premium to retirees and 86% anticipated doing it over the next three years. Not only have the costs increased, but a lot of companies face a huge under-funded plan. While under-funded pensions have garnered attention, post-retirement benefits have not attracted the same attention from analysts. In many cases the funding gap for these benefits outweigh those of the pension. At the end of 2002, General Motors’ pension was under funded by $19.3 billion. The company made front page news by issuing debt to fund the obligation. However, its health benefits plan was under-funded by $51.4 billion. Its obligations were $57.2 billion with assets of only $5.8 billion."Goldilox:Pension and retiree healthcare issues just won't go away! Druid (1/14/04; 21:59:54MT - usagold.com msg#: 115356) Where Are the Bond Market Vigilantes!? http://www.gold-eagle.com/editorials_04/temple011204.html Snip."The other major constituency-domestic banks and other U.S. (and some Japanese) financial institutions-requires constant reassurance that the Fed won't be taking the "carry trade" game away. Lest I assume too much and confuse readers, let me explain: a bank or other type of financial institution can borrow money at somewhere around one percent, and invest those funds in longer-dated Treasuries paying between four and five. The "carry trade" refers to this practice, as well as the difference-three or four percent-which the trader earns. The Fed has seemingly made this a safe bet; and has thus been able to keep long-term market rates surprisingly low. Instead of buying the Treasuries itself, though, the Fed has these other self-interested parties to do its work for it, which maintains the strong demand for Treasury debt.The Fed can ill afford to frighten away those playing the "carry trade" game. Once you understand just how much this has kept long rates docile, you realize just how petrified, in fact, the Fed must be about the prospect of finally having to give in some day and start raising short-term interest rates. Those who will call for such responsibility on the central bank's part will say that-by raising short-term rates-the Fed will soften oncoming inflation pressures and actually cause long-term market rates to come down. Instead, though-by taking away the carry trade-the Fed will actually increase the selling pressure on long-term Treasuries. It knows this.So the Fed has decided that it must "sacrifice" those foreign investors still crazy enough to own U.S. Treasuries. Japan and China aren't about to curtail their huge purchases of U.S. debt any time soon, so the Fed and the Treasury don't have to worry much about them. The only significant group of foreigners that might leave are those predominantly European private investors and institutions that haven't already; and who cares about them? Those sissies didn't support Bush's war, anyway.All this explains why-for now-Treasuries are strong, even as the dollar sinks virtually every day. It explains why Fed officials like Bernanke and Treasury Secretary Snow are so smug in making dollar-wrecking statements that some of us think are delusional, if not insane. It explains why the Fed may end up not raising rates for most (or all) of 2004 after all-and why for the most part they just might get away with it. But especially if they do, this all also means that the aftermath of the Fed's latest-and arguably grandest-moves to postpone the inevitable will be that much worse for the central bank to have to deal with."Druid: This is an excellent commentary on something I touched on not to long ago when I implied that the Fed and the bond speculating crowd had to "row" in the same direction. The bond market is the last stopgap measure to keep the flood at bay. Treasury yields have moved down drastically over the last few days indicating a tremendous amount of buying. So far it appears that the currency market hasn't been roiled by the sharp decline in the dollar over the last few months leading me to believe that the final battle will be waged in the bond pits. IMHO. Druid: PA, you're welcome as the pleasure is mine to contribute. mikal (1/14/04; 21:50:42MT - usagold.com msg#: 115355) UN issues economic report card http://abcnews.go.com/wire/Business/ap20040114_2507.html Spinning the same mantras on growth and employment with a few new conditions slipped into "the fine print" newsprint for public disclosure, and falls in line with recent statements by the IMF, Fed officials, Robert Rubin, Warren Buffett, Paul O'Neil, John Templeton, ECB officials, etc.:U.N. Forecasts Surge in World EconomyU.N. Forecasts World Economic Growth Will Accelerate to 3 1/2 Percent in 2004The Associated PressUNITED NATIONS Jan. 14 —Excerpts:"After three years of slow growth, the global economy will surge by 3 1/2 percent this year with the United States and China leading the way, the United Nations predicted Wednesday. But the U.N. economists warned that the generation of new jobs and imbalances in the global economy pose threats. The report urged the major powers to focus on the problem of unemployment rather than cutting inflation." "After a decade of stagnation, the Japanese economy has improved, led by business investment and an acceleration in exports to other Asian economies, the U.N. economists said.Many analysts have concluded "this is the first time the Japanese recovery is based on China so that China is actually becoming the locomotive of Japan in a very significant change with respect to the past," Undersecretary-General for Economic Affairs Jose Antonio Ocampo told a news conference launching the report. The report said average economic growth in south and east Asia should increase to 6 1/4 percent this year and 4 percent in the western part of the continent. European growth remains subdued, but signs of a modest upturn are emerging and 2 percent growth is forecast. Latin America is expected to achieve growth of 3 1/2 percent, and Africa's growth may top 4 percent. Russia will continue to be the economic engine for growth in the former Soviet empire will should increase by more than 4 percent, the report said." Mr Gresham (1/14/04; 21:31:37MT - usagold.com msg#: 115354) Bank merger Just skimming below, I see you've probably got some good insight on bank goings-on -- just to mention that Bank One's "lucrative credit card business" is the old First USA, which abandoned that name only a few months ago. Probably the most widely reviled credit pusher, there are websites devoted to airing its dark-side practices... They were not the openly sub-prime credit issuer that Providian and a few others were, but they probably have lots of defaulting debt showing up, and a lot of their "profits" are from late fees and overdraft penalties, with the default rate watered down temporarily by growing volume, volume, volume. So it goes in the plastic trade...So BOA picked up Fleet; that would be a candidate (in their own mind) for "Fed's Chosen Survivor" (while JPM is the sacrificial derivative goat), but in a crunch, even BOA might be too derivative-laden. My dark horse candidate, until I can look at some balance sheets, would be Key Bank. Seems at last look like they have avoided some of those risky games.I would look at the top 10 banks and pick the three with the soundest balance sheets, with the least derivative, real estate, and business recession exposure. I suppose Martin Weiss might be one to make a good guess on this.Remember, to be a Survivor Bank, even with losses, all you have to do is outrun the other banks, while they get eaten by the bear. Cytek (1/14/04; 20:59:28MT - usagold.com msg#: 115353) A Friend of mines Thoughts - FOMT A Friend Of Mines Thoughts. I will call him FOMT. He sent me this email last week and has given me permission to post it on USAGOLD. I will send your comments to him. Thanks.Cytek, I Have a theory to run by you. Hamiltons' recent post that you sent me at 321 shows the dollar and gold relative to 200 dma in extremis. He thinks there is a major correction coming. Dollar up - gold down. Looks convincing on the chart.Where is the dollar "strength" going to come from. Well, where would $$$'s go if the stock market took a major dive??? Flight to safety right? Treasuries, or bonds, right?Therefore T & B go up in price. Being derivatives of and for the dollar, thereby the dollar looks better. If dollar "looks" better then M3 #'s diving are not a concern.Simple perception management.The M3 #'s actually bolster the argument. Leading indicator that is mystifying so many pundits. How'd that happen if not for the Japanese buying dollars like there's no tomorrow. What's in it for the Japanese?? Who's got a gun to their head??? When T & B go up in price, interest rates are steady or fall a bit. Buys more time, they only need months. What's in it for China to play another round of dollar roullette??? I think the boyz are going to crash gold hard and squeeze the last weak hands until they fold.May have been pre-arranged - smile - what isn't??Simple sting if you can line up the right folks to play the parts. Somebody gets to buy the last available supply of physical ... cheap.Check and mate. It fits with "apparent" Central Bank "stupidity". If we had the ability to follow the real money trail it might very well lead through a networked thicket to Asia. They're probably sneaking psycho-active substances into Sinclair's food supply. Mild hallucinogens.Keeps everybody off balance. 30 years of exporting capital and equipment and jobs doesn't occur without intense planning. The "agreement" stipulated Asia would give us one last fling, but it would cost big. Probably occurred around 1987 period.Are that posts that you sent me from Trail Guide, Another, GATA, et. al. mere smokescreens and diversionary tacticians.Asia is not going to let its dollars burn. Why would anyone believe they'd need to??? Look at what those $$$'s can buy. Probably get all of the US Congress for a few billion. They'll be there to "catch" the gold and mining companies. Then the dollar will burn.Because in the final analysis it ain't about the dollar at all. That's just a tool, a magicians' scarf, a distraction.This is about who runs the New World in the making.Brutal and elegant.Forget Keynes - "We're all slaves now" is the new motto. Gandalf the White (1/14/04; 20:33:03MT - usagold.com msg#: 115352) THERE it is, Sir Soc !! The Au P&F Chart "Reversal that you were looking for ! http://stockcharts.com/def/servlet/SC.pnf?chart=$GOLD,PLTB[PA][DA][F!3!!]&pref=G <;-)NOW, we are ready to go "TO THE MOON" ($460. +) Paper Avalanche (1/14/04; 19:15:45MT - usagold.com msg#: 115351) @ Druid My many thanks to you.It appears that the $430 level has been considered by TPTB as the absolute line in the sand for the last fifteen years and may very well be the "Alamo" for the cabal.Take care.PA Max Rabbitz (1/14/04; 18:58:08MT - usagold.com msg#: 115350) Mikal on German Gold Very Interesting and plausible to sell the NY stored gold if there are problems with it's return to the Fatherland. But on other matters such as the Iraq War there seems to be no problem with disagreement and conflict with the old empire. So I still wonder....is it the facade of trust or old Banker's Trust obligations? Druid (1/14/04; 18:39:53MT - usagold.com msg#: 115349) Paper Avalanche (1/14/04; 14:40:02MT - usagold.com msg#: 115330) http://www.house.gov/paul/committeework/bankingtrans/99_2_24.htm "Page 57-59Mr. GREENSPAN. There is a significant part of our work force who are not doing well and haven't been doing well for quite a long period of time. I don't deny that at all.Mr. SANDERS. Thank you, Mr. Chairman.Chairman LEACH. [Presiding.] Thank you, Mr. Sanders.Dr. Paul.Dr. PAUL. Thank you, Mr. Chairman.Mr. Greenspan, a lot of economists look to the price of gold as an indicator and as a monetary tool. It has been reported that you might even look at the price of gold on occasion.Last summer on a couple of occasions here when you were talking before the committees on securities and on derivatives you mentioned something that was interesting. You said that central banks stand ready to sell gold in increasing quantities should the price rise, which I thought was rather interesting.Then I followed up with a letter to you to ask you whether or not our central bank might not be involved in something like that, in the gold market. And you did answer me and stated that since the 1930's the Federal Reserve has had no authority to be involved with the gold markets."Druid: PA, I don't know whether this post is what you are looking for but here is one Q&A session that took place. mikal (1/14/04; 18:19:52MT - usagold.com msg#: 115348) @Town Crier The graph of gold in dollars since 2000 is impressive enough that I can see the implied path traced out beyond Jan. 2004, even without the aid of a French Curve!I will quote the poster "Ernst Welteke" from his contest entry of this week that you have archived on your Golden Chalkboard.The entire essay portion amazes me. Though we've heard some of this before from yourself, Belgium, Trail Guide, MK, Aristotle, Anduril, Aragorn and others, it covers new ground and has such gravity to require numerous rerereads. The essay begins where "Ernst" states that after his gold sales comments/justifications at the start of 2002, gold in euros stabilized, but gold in dollars accelerated and your graph corresponds exactly! Then he continues: "It is probably not an accurate worry that you deem me to have an "obsession" for the sale of "the German people's GOLD" or "patrimony". This is no idle obsession, and more to the point, strictly speaking, this is not the people's GOLD. Please bear with me.Our situation in Germany is not exactly the American experience. In your case, the GOLD within your Federal Reserve banking system was appropriated by your people's Roosevelt government in 1933. It now truly belongs to your people's governmental Department of Treasury. And how even now, may I ask, might a U.S. citizen go about to lay claim on their share?The primary quantity of GOLD still being held by your Federal Reserve banking System is therefore not the original metal forming the basis of that monetary institution, but is the GOLD they have been holding as custodians under earmark to international institutions such as our Bundesbank.By contrasting experience, meanwhile, our institution has not been so looted by an overreaching government. Rather unlike the Federal Reserve's experience, it has been granted by Parliament of our Federal Republic of Germany that the Deutsche Bundesbank be independent of the instructions from Community institutions and government bodies such that the Bundesbank (similarly the ECB) remain free to pursue the mandate of price stability and the holding and managing of the foreign reserves (including GOLD) which were accumulated as a result of years of our past institutional operations. Please, do think about this carefully and what it portends to patrimony. You will likely find it more agreeable to the people it serves than the "looted" GOLD of the American experience.All activities to date, this includes 110 million ounces of GOLD and receivables that we own and hold as reserve assets, which internally we now revalue monthly against our so-called "hidden reserve" revaluation account represented as a balance sheet liability.As I said to the German newspaper FAZ on 18 October 2001 regarding our accumulated monetary reserves and the balance sheet, "The monetary reserves result from the Bundesbank's monetary policy activities in the past. The corresponding items on the liabilities side of the balance sheet are banknotes in circulation and deposits of credit institutions."The monetary reserves therefore cannot simply be extracted from the balance sheet without being replaced by another asset. They are not a kind of treasure trove which can be freely encashed without any counter-obligation."However, should they be sold -- against payment of the corresponding price by the purchaser -- the reserves contained in the "revaluation accounts" could be booked as a capital gain and distributed with the Bundesbank's profit. Another point to bear in mind is that monetary reserves still play a key role in reinforcing public confidence in the currency and anchoring the credibility of the national central banks."And to be sure, any considerations of direct withdrawal and transfer of reserves "to other public institutions or any attempt by government agencies to influence the Bank in its task of managing the monetary reserves would breach the EC Treaty [Article 105 (2)] and infringe the Bundesbank's independence." To that end, although we subscribed our EUR 12.2 billion share, 15% of that in GOLD, of the original EUR40 billion in foreign reserves to the ECB, the foreign reserves shall continue to be held by each national central bank, with nonsubscribed reserves subject to transaction approval by the ECB above certain volumes to maintain a consistency of E.M.Union-wide policy.This brings us back to the topic of GOLD sales. Why would we talk publically about consideration of sales or actually pursue such sales? I assure you, it would not be to increase the dollar-portion of our reserve position! If we hint about it now, or if we sold GOLD in coming years, it would all be for leverage -- using GOLD for the purchase of political advantage in a larger picture.On the one hand, I think it fair to say we have moved beyond the role of "lender of last resort" in the realm of bullion banking. If a commercial bank experiences an underwater position on its GOLD books, why would we risk metal to aid a hung counterparty when the dollar-system so easily allows such contract problems to be brusquely obscured with a lush hedge of derivatives? A paper solution to a paper contract problem!On the other hand, there is the wider needs of GOLD within the official sector to attend to. Close to home we have ten acceding countries to the EU that shall initially pay 5% of their subscription share to the ECB. Then after at least two successful years under ERM II toward fulfilling the Maastricht convergence criteria, when the euro is adopted by each country their full subscription share is due, with expectations of 15% of the total as GOLD. Currently the GOLD holdings of these ten countries average less than a 4% share of their total reserves. In the big picture, it may be prudent for all parties concerned for an existing GOLD-rich EMU neighbor to ensure that these countries have no hardship securing access to any necessary GOLD.More significantly, GOLD can be spent like political capital in buying the euro-friendly cooperation of significant economic bodies like China that may seek GOLD yet find it impossible to acquire at standard market outlets.With a history of the American penchant for looting GOLD residing uppermost in your mind, if you were the President of an overseas entity that had a share of its precious GOLD being held under earmark by an American institution in New York (the Federal Reserve Bank), wouldn't you want to put your mind at ease, and perhaps even kill two birds with one stone? How might you go about this?You start talking. If your friends are in need of GOLD, you make sure the price does not too soon get out of hand. Perhaps you prematurely mention the possibility of sales. Your friends will know you are serious about coming through for them.Additionally, you do not want to ruffle feathers in Washington or New York by letting them think that you question their integrity as a custodian of your GOLD. You certainly do not ask to have it shipped back to you on your own behalf for no good reason.What you CAN do, however, is to sell this quantity of earmarked GOLD in good faith to China, for example, who can then in good faith as the new owner announce that it is their national policy to request delivery of their new purchase for official CB holdings and also to help feed the growing domestic demand in their newly liberated GOLD market....." knotakare (1/14/04; 18:01:13MT - usagold.com msg#: 115347) words of Wisdom Here are some words of wisdom I have read on the web recently:> "this massive inflation will appear miraculous until the wheels fall off"> "markets can remain irrational longer than you can remain solvent" Keynes> "when a thousand hungry lions fight over one scrap of food, small dogs should hide what's in their belly"> "we who are about to die, salute you"(said to Sir Allan?) CoBra(too) (1/14/04; 17:58:28MT - usagold.com msg#: 115346) Mega Bank Mergers - Somehow I get the feeling that the latest mega bank Mergers are somehow Gold derivative related. DB/BT Republic NY/HSBCChase/JPM - and now Banc OneMay we expect similar transactions in the brokerage industry - GS/MSSB, or who cares, anyway. More important may prove to be the future of DB/BT and UBS/FB in this regard - as I've always postulated some relevance to their respective cb's gold sales, or chatter about the same ... and in the final analysis, I don't buy anything close to a voluntary (game?) plan. I do strongly feel that a systemic risk has presented itself before the (now I'm at a loss - and just figure) the global PTB were ready to accept the consequences. Will they ever be?... Though, that's exactly the recipe' of the stew with all the ingredients of "beggar thy neighbor". A recipe for ending up at the end of the bread line - eventually! Don't know if J.P. Clarck's is still around in NY. At my time I sure loved it. Much more than the private luncheon suites at JPM - with the exception of a great place down- town, where allegedly old JPM himself was a regular in his own dining room. Still growing my own potatoes - edible assets - cb2 TownCrier (1/14/04; 17:34:56MT - usagold.com msg#: 115345) An answer or two for Great Albino Bat Getting to the heart of your questioning, it is not within the jurisdiction of the Bundesbank to lend to any public-sector (i.e., governmental) entity. The ECB is likewise prohibited from public-sector lending by the Maastricht treaty.Within the euro area, sole right of approval for the issue of banknotes belongs to the ECB, but may be assisted in approved distributions by the national central banks such as the Bundesbank. Further, within Germany, the refinancing of the banking system is conducted by the Bundesbank in accordance with the ECB's monetary policy and via the ECB's tools for that task.I hope this helps.R. CoBra(too) (1/14/04; 17:19:06MT - usagold.com msg#: 115344) Hear Ye - Re-reading the Golden Chalkboard at request of the Wizard and on behalf of TC, together with MK's history - makes a lot of sense. Thanks gentle Knights for "another" insight! cb2 goldquest (1/14/04; 17:03:45MT - usagold.com msg#: 115343) Benanke Also skirted around the two major reasons that I think gold has increased in value. Demand and the lack of supply.He cites geopolitical as his main reason that the price of gold has increased. If 9-11 didn't move gold all that much, I don't know what geopolitical movement could possibly do it. Pizz (1/14/04; 16:55:11MT - usagold.com msg#: 115342) Socrates964 Maybe I'm just hitting a mental block or you're question is a couple levels over my head (quite possible), but to me, the BOJ, or whomever, basically accomplishes support for both the dollar and bonds by buying bonds from domestic (US)sources.Dollars come into Japan via export payments, and if they are recycled into treasuries purchased from US institutions, the bonds are supported and the dollars are off the international market. Course they end up sloshing around the US banking/brokerage establishments and are supposed to be inflating our prices (course you need robust employment and demand first). The banks have no use for them since loan demand from creditable borrowers is down, individuals loaned to the hilt, etc., (look at M3 lately) the best answer I can give is we are recycling them internally in a daisy chain thru the stock and bond markets, again, and again. And with no reserve requirements, in theory they could spin the markets up to infinity.Old theory was with a 20% bank reserve requirement, dollars could only ratchet up anything 7 or so times. If a bank receives $ from Japan in exchange for treasuries, takes ALL the dollars and buys stock, and the seller (recipient of the dollars)buys bonds, and the bond seller deposits the dollars back in a bank, etc. etc.Now I sure hope I'm not making sense, but not too much out there is right now (short term). But if you believe that the only way to rid the world of excess dollars is thru deflation and default, and since they won't let that happen, we could have . . . . now why did I buy those S&P puts this am . . . . cause maybe all the stock and bond market players are going to get rich beyond their wildest dreams - until some kid on a pc hits the wrong button and sells a couple share's of xyz at the wrong time. . . -------------------Meanwhile, while we wait for Rich to load the microwave with the frozen chicken for a ppppppprediction. . . --------------------Just thinking out loud, ranomly, and whatever. . .Pizz steady (1/14/04; 16:47:36MT - usagold.com msg#: 115341) question? if they try to put the fiat fire out, with water will all the colors bleed into one....GOLD! Great Albino Bat (1/14/04; 16:32:29MT - usagold.com msg#: 115340) GAB requests reliable information on the ECB... All posters:The GAB is under the impression - perhaps mistaken - that in spite of the existence of the ECB, each member of the EU has its own Central Bank and that national central bank can and does produce its own Euro notes and coins, and also (and more importantly) allows the banks under its own national jurisdiction to create means of payment via expansion of banking credit. Also, the GAB is perhaps mistaken in thinking that government deficits in France and Germany pose a threat to the stability of the Euro, precisely because the French and German banks will buy the additional government bonds which will be issued to fund the deficits of their respective governments, and will thus be monetizing the French and German deficits and expanding Euro money supply.And that this is why the other governments, such as Ireland and Portugal, were punished for incurring in deficits - because those deficits jeopardize the value of the Euro which all participants in the EU utilize.Some posters at this Forum, deny that the varous Central Banks can individually add to the Euro money supply. I question this denial. If the Bank of France and Bundesbank cannot add to their French and German money supply - which will spill over to their neighbors - why all the outcry about jettisoning the Stability Pact? Why is the Stability Pact linked to controlling deficits in France and Germany?This request for information relates to gold closely, since if the Euro money supply and therefore the Euro's value can be affected by individual Central Banks, this will affect investor's attitude toward gold, in Europe and elsewhere.with thanksThe GAB Gandalf the White (1/14/04; 16:29:57MT - usagold.com msg#: 115339) HEAR, HEAR ! The Town Crier has DONE IT AGAIN !! <;-) http://www.usagold.com/goldenchalkboard/gc_Welteke.html TownCrier (1/14/04; 16:08:45MT - usagold.com msg#: 115337)"Hear ye! Hear ye" is my cry! This one's especially for Sir Belgian===THAT is a GREAT job, Sir Townie !!EXCELLENT charts to prove the point.<;-) Paper Avalanche (1/14/04; 16:10:43MT - usagold.com msg#: 115338) @ goldquest... I find Berni's remarks to be a combination of a continuance of the standard line spouted by the nice people on TV with a tacit denial of the real reason that gold is appreciating. While I do agree that the primary factor driving the dollar price of gold has been, to date, the dollar's depreciation (and thus gold is not rising in terms of the euro and other strong currencies), I do not agree with him that gold's role is best viewed only in historical context. I beleive that his remark"I agree that there have been periods in the past when the fear that drove investors into gold was the fear of inflation."would be better worded to read..."I agree that, similar to periods in the past, the fear that is likely driving investors into gold ***IS*** the fear of inflation."But that is obviously not what he is paid to do.IMO, the two MAIN factors driving the price of gold for the past two years has been 1) the depreciation of the dollar and 2) the smart money getting in now anticipating the inflationary road that lies ahead.Just my opinion.PA TownCrier (1/14/04; 16:08:45MT - usagold.com msg#: 115337) "Hear ye! Hear ye" is my cry! This one's especially for Sir Belgian http://www.usagold.com/goldenchalkboard/gc_Welteke.html It got my keen attention when he called the "Ernst Welteke" post 24 karat gold, and so I figured it would be a good candidate for treatment at the 'Golden Chalkboard', to be further refined (if that's possible on 24K) with the inclusion of some key graphs that I assembled today to demonstrate how February 2002 truly marked a sea change.This installment at the Chalkboard begins with the background provided Sunday by MK on the Bundesbank President's history of public talk on German gold sales that began Feb '02.Within the context of the Welteke commentary, the bottom graph is a picture worth a thousand words, not to be missed.R. R Powell (1/14/04; 15:30:14MT - usagold.com msg#: 115336) Pondering proper precise price predictions procedures..... Both gold and silver are down in the afterhours markets. I've consulted a vast multitude of technical indicators which couldn't explain this downturn even after I filtered, convoluted, and adjusted the chart scale. Finally, I found my error. I needed to change the temperature from celsius to fahrenheit to enter into the formula the current temperature on the top of New Hampshire's Mount Washington, -103 degrees. Then...Bingo..the exact spot prices appeared. I'm fairly confident that any warming on Washington will reverse this downtrend. Unfortunately, this may take some time. At the worst, we'll have to wait for Spring before POG crashes through $450 on it's way to $1019 by June. I was pondering the possibility of sacrificing a plump Rhode Island Red for further entrail reading research but found all the chickens frozen. I'll have to defrost one in the microwave. More later... Rich goldquest (1/14/04; 15:26:21MT - usagold.com msg#: 115335) More Benanke http://www.federalreserve.gov/boarddocs/speeches/2004/20040104/default.htm From Benanke's speech in San Diego, Jan 4th, 2002."Two specific commodity prices that often command attention are prices of gold and crude petroleum. The price of gold has increased roughly 60 percent since its low in April 2001, from about $255 per ounce to about $410 per ounce. A portion of that increase simply reflects dollar depreciation, which I will discuss momentarily. Gold also represents a safe haven investment, however, and I agree that there have been periods in the past when the fear that drove investors into gold was the fear of inflation. But gold prices also respond to geopolitical tensions; these tensions have certainly heightened since 2001 and, in my view, can account for the bulk of the recent increase in the real price of gold." Other than calling gold a commodity, I do not detect Benanke being too anti-gold in this speech. Socrates964 (1/14/04; 15:18:38MT - usagold.com msg#: 115334) Pizz Don't believe so. In any case, what I'm trying to get at is what the constraints are on BOJ/MOF supporting the $/$ bond market and can it do both at once or does it have to choose and would it actively be dissuaded from supporting the former by US authorities. In theory, the two institutions could buy any amount of US paper, albeit at the cost of hyperinflating their own currency.My own feeling is that there are limits (although not sure where) and that sooner or later the Japanese will tire of being bagholders for the dollar (given the trade figures, I suspect sooner).In this sense, perhaps Japanese criticism of the US' twin deficits is not a spontaneous expression of displeasure but follows a fireside chat by the Fed on the lines of 'Stick to supporting the bond market and let the greenback find its own level'. Any thoughts? Goldilox (1/14/04; 15:06:27MT - usagold.com msg#: 115333) INTC Earnings Reuters snippit:"SAN FRANCISCO, Jan 14 (Reuters) - Intel Corp., the world's largest producer of microchips, reported a 22 percent rise in quarterly revenue on Wednesday due to strength in its processor business, and higher profit despite a $611 million charge for a communications-related acquisition.Intel said it expects first quarter revenues to dip from the fourth-quarter. Intel forecast first-quarter revenue in the range of $7.9 billion to $8.5 billion, and said it expected its gross margin to reach 60 percent, plus or minus a few points.In the fourth quarter ended Dec. 27, Intel (INTC,Trade) reported a profit of $2.17 billion, or 33 cents a share, on revenue of $8.74 billion. In the prior-year period, the Santa Clara, California-based company reported earnings of 16 cents a share on net revenue of $7.16 billion."Goldilox:Again on CNBC, a First Call rep added that Intel's GAAP profit included a $0.06 write-down, not reported in the press numbers. This drops them back to $0.27/s, well within the First Call estimates. It also explains the $1.32 drop in INTC after hours trading. . . C.R.A.P numbers, as Papluva calls them.Many analysts have said Intel is the benchmark for NASDAQ moving forward, so this doesn't portend well for techs. Paper Avalanche (1/14/04; 14:58:27MT - usagold.com msg#: 115332) @ Artie Farkle Thank you kind sir!PA Artie Farkle (1/14/04; 14:51:42MT - usagold.com msg#: 115331) here you go Alan Greenspan himself referred to the federal government's power to manipulate the price of gold at hearings before the House Banking Committee and the Senate Agricultural Committee in July, 1998: "Nor can private counterparts restrict supplies of gold, another commodity whose derivatives are often traded over-the-counter, where central banks stand ready to lease gold in increasing quantities should the price rise." [Emphasis added]. Paper Avalanche (1/14/04; 14:40:02MT - usagold.com msg#: 115330) @ Socrates (or the Forum) A snip from your last post..."They know that if gold takes out 430, then they're toast"reminded me of a statement that I believe I remeber Alan Greenspan made before congress when testifying to one of the banking or budget committees. To paraphrase what he said (if I am remembering correctly) when asked about the price of gold and any potential rise above $429, Sir Alan responded that the Federal Reserve (or CB's) stood ready to "summon the powers of heaven and earth" to prevent the price of gold from ever trading above that level.I have searched google endlessly to try and find the exact quote. If anyone has access to lexus / nexus and is able to search for this statement (or has a better memory than me) I would be forever grateful. It might very well illustrate how close we are to the final battle between the pro-gold camp and the cabal.Thanks in advance.Paper Avalanche. Survivor (1/14/04; 14:36:40MT - usagold.com msg#: 115329) Bernanke in Geneva The link posted by our TC is to a paper authored by Bernanke and Vincent R. Reinhart that was presented in Geneva. Bernanke may have presented the paper, but he probably made other comments as well. This could explain the remarks about gold that were repeated on CNBC. Or not.- Survivor J-Bullion (1/14/04; 14:33:32MT - usagold.com msg#: 115328) JPM/Banc One Big banks don't fail.....they just merge into new entities.JPM/Chase/BancOne.............maybe Citi will join them next??? Goldilox (1/14/04; 14:26:39MT - usagold.com msg#: 115327) JPM buys Banc One http://online.wsj.com/public/us snippit:"J.P. MORGAN CHASE has agreed to acquire Bank One in a deal that would combine two of the nation's largest financial institutions, according to a person familiar with the matter. The deal is estimated to be worth about $60 billion."WSJ also reports that Banc One CEO Diamond will ascend to JPM CEO in two years. JPM also gets Banc One's very lucrative credit card business.Goldilox:Another BIG bank merger. From "Highlander" - "There can only be one!" steady (1/14/04; 14:23:09MT - usagold.com msg#: 115326) currents symetry? congruence, inverse? reflections< nope transverse the last few days, more to come? Ten Bears (1/14/04; 14:21:46MT - usagold.com msg#: 115325) Goldilox ,# 115315 http://www.chaos-onomics.com/morn.htm "Why is everyone having such a tough time taking Bernanke and Greenspan at their word?""Buried in the back of a Washington Post article on the White House vs. O'Neill bruhaha, lies a revealing quote attributed to Greenspan around Feb 2002: "There's been too much gaming of the system until it is broke. Capitalism is not working! There has been a corrupting of the system of capitalism." My, my what a contrast to his public face at roughly the same time, Jan 2002, "But if the recent more favorable developments continue and gather momentum, uncertainties will diminish, risk premiums will fall, and the pace of capital investment increasase" Goldilox (1/14/04; 14:20:25MT - usagold.com msg#: 115324) Barron's site - Tech Stocks and Gold http://barrons.com snippit:"Gold is a bull market in its infancy and should be bought on dips, while tech stocks are more likely a bear market in its infancy and should be sold on rallies."Goldilox:From jsmineset:"Did they really say that?" Goldilox (1/14/04; 13:35:34MT - usagold.com msg#: 115323) No response No, Maria's too busy blubbering over John McEnroe, as they have just inked him for evening talk show duty. She told him she plays tennis, as does Michelle Carusa-Cabrera, so I think Johnny Mac needs to sponsor a match set on his show! Pizz (1/14/04; 13:16:26MT - usagold.com msg#: 115322) Goldilox A response?LMAO!!!!!Pizz Goldilox (1/14/04; 13:13:15MT - usagold.com msg#: 115321) EMAIL I sent an email to "Closing Bell" questioning the inconsistancy. If I don't report back . . . call my lawyer and post bail. Goldilox (1/14/04; 13:03:09MT - usagold.com msg#: 115320) Not my spoof It was reported and transcribed on the screen, not verbatim, but VERY close to what I said. That's interesting. They might have transcribed an earlier statement for better timing. TownCrier (1/14/04; 13:00:33MT - usagold.com msg#: 115319) Goldilox, you can look here http://www.federalreserve.gov/BoardDocs/Speeches/2004/200401033/default.htm Text to the speech delivered today by Governor Ben Bernanke. I, for one, could not find your reference, or for that matter, any reference to gold.Was your CNBC report a spoof?R. goldquest (1/14/04; 12:58:09MT - usagold.com msg#: 115318) Benanke Comments http://www.federalreserve.gov/boarddocs/speeches/2004/200401033/default.htm in Switzerland. Goldilox (1/14/04; 12:49:43MT - usagold.com msg#: 115317) dx http://quotes.ino.com/chart/?s=NYBOT_DXY0 Classic Head and Shoulders???? should know in about 30 minutes. . .Hey -LW, maybe DanDruff is buying dollars! Goldilox (1/14/04; 12:39:35MT - usagold.com msg#: 115316) Desperate, at best CBS Marketwatch screams "Gold Plummets!"Right - $2 lousy bucks - 0.5% - GET A GRIP!I'm sure they would not scream "NASDAQ plummets - the bull is dead!" every time the DOG does a 0.5% doody in one day. Goldilox (1/14/04; 12:33:41MT - usagold.com msg#: 115315) Bernanke Speech I can't find a written reference, but CNBC reported Bernanke's speech in Switzerland (taking in some good skiing?) this morning contained the following about gold (I paraphrase the best I can):- Gold is still a valuable reserve asset, but it no longer has any place in monetary systems [except in the printed circuit boards of my printing press].Translation:- It's better to have it in my safe than my government's.Ron Insana's on air question:Why is everyone having such a tough time taking Bernanke and Greenspan at their word? HAHAHAHAHA! Pizz (1/14/04; 12:28:05MT - usagold.com msg#: 115314) Socrates In response to your inquiry, wouldn't it depend on whom the MOF bought the treasuries from?If the cash dollars come back to the US (banks) in exchange for treasuries, then the banks buy more treasuries (never ending supply), and I guess since we are deficit spending on war, etc, that they could eventually get back into the international market - heck I just went full circle. . . Based upon the markets today, I don't think anyone has this figured out. . . Back to watching all the traders try to outdo each other. . Pizz Socrates964 (1/14/04; 12:21:20MT - usagold.com msg#: 115313) Goldilox Yes, CNBC smacks of desperation. Gold above 415 is immeasurably stronger technically than below 380. I get the feeling that this is the cartel's last stand. They know that if gold takes out 430, then they're toast (at least as far as their ability to control the gold market is concerned). Hence their attempts to make gold and gold share ownership as unattractive as possible. VanRip (1/14/04; 12:05:47MT - usagold.com msg#: 115312) *****434.1***** "Hi ! "My name is Ernst Welteke and I think that Germany should sell its Gold because I believe in the old German proverb "A donkey laden with gold is welcome in every village." So this means that by selling our gold and investing the proceeds in improving the lives of the poor, we will be heros in all the villages of the third world. However, the fact that "An ass laden with gold is still an ass," is just a typical American misinterpretation of the original proverb. Socrates964 (1/14/04; 11:58:49MT - usagold.com msg#: 115311) POG 1. Scratching my head here, since all the charts suggests gold should be much lower than where it is now.The P&F suggested that we had to go down to 412 to recharge for the next run.Gold normally moves in $17 multiples, so the move off the $431 top should have gone to at least $414.And yet it hasn't happened, and I suspect that if the optionmeisters can't get it below 420 by Friday to defraud holders of call options, and the BOJ can't even keep the Euro below 1.27 then it won't happen.I conclude that TA is not working. And the reason it isn't working is that nobody wants to hold dollars and TA assumes that all market participants are traders looking to maximize profits.2. I agree that we're unlikely to see the color of the ECB's money in a hurry. Kind of a charade in which Snow says: 'The US remains committed to a strong dollar policy' and the ECB replies 'Mais oui, Europe is concerned about its exports'. The truth is that Europe is largely a closed economy that loves cheap commodities (since it makes its money by processing them). The Europeans merely think that it's indiscreet to admit it in public.So, if the Europeans don't mind a lower dollar, if Greenspan doesn't mind a lower dollar and the Chinese just go along with a lower dollar, that only leaves the Japanese.I'll repeat my question to the board. The BOJ already had to issue yen to its exporters who wanted to sell their dollar-denominated export earnings. Now it has to issue even more yen for the MOF's currency intervention. Is it not the case that once the MOF has turned its newly issued yen into dollars, it is then condemned to sitting on these dollars, since if it tries to buy longer-term dollar debt, it has to sell these dollars which immediately leak back into the international market?And doesn't this extra issuance constrain the BOJ's ability to buy long-term debt and hence the US' attempts to keep the credit bubble inflated?Surely the Japanese have to choose between buying debt and buying cash dollars? Won't the US authorities say to the BOJ, 'Look, whichever you buy, you're going to get stiffed, but it helps us a lot more if you buy our debt rather than our cash dollars. If you stop intervening in the currency markets we'll think up a quid pro quo'.If so, then no-one will really be supporting the dollar, not even the Japanese. Any thoughts? Goldilox (1/14/04; 11:56:20MT - usagold.com msg#: 115310) Gold correction publicity I am amazed at the breadth of publicity in the media for 0.5% correction. CNBC is showing the gold chart about every half hour. Too bad it's been rising since the initial opening reaction, as it only further demonstrates the underlying strength of Sir Shiny! Goldilox (1/14/04; 11:40:08MT - usagold.com msg#: 115309) Blind Trusts Politicians are required to put their personal assets into "blind" trusts for the duration of their term. Aptly named, as they would suffer that fate if allowed to stare at all the shiny they have accumulated from their governments at rock bottom prices.Only my opinion, of course. Goldilox (1/14/04; 11:28:44MT - usagold.com msg#: 115308) Missed them Darn, TC, I had all my trading windows open and I missed them! You are quicker than a dollar down tick! Are you sneaking some of that roo meat!(:^> -G TownCrier (1/14/04; 11:09:39MT - usagold.com msg#: 115307) That was a first. Those (now missing) posts actually pegged the Off-Topic meter. Pegged it, and the needle twisted off!R. Goldilox (1/14/04; 11:07:30MT - usagold.com msg#: 115306) Pt - quietly not participating in today's lunacy http://focus.comdirect.co.uk/en/detail/_pages/charts/main.html?sSymbol=GLD.FX1 Pt is hanging around $855-860. . . down 0.125 %. Goldilox (1/14/04; 10:28:01MT - usagold.com msg#: 115303) POG http://focus.comdirect.co.uk/en/detail/_pages/charts/main.html?sSymbol=GLD.FX1 The paper boyz are having their fun, but I predict only a small delta in physical at the fix. It's one thing to trade paper in and out, but they don't want to make accumulation TOO easy. Goldilox (1/14/04; 10:24:40MT - usagold.com msg#: 115302) DX http://charts-d.quote.com:443/1002980432830?User=demo&Pswd=demo&DataType=GIF&Symbol=DX00Y&Interval=10&Ht=600&Wd=800&Display=2&Study=MA&Param1=13&Param2=0&Param3=&FontSize=10 DX=95.72Dollar rally or blip? Runner (1/14/04; 10:19:24MT - usagold.com msg#: 115301) *****424.90***** Hi, my name is Ernst Welteke and I think Germany should sell its Gold because I was told to do so and could take 5% for my self. USAGOLD / Centennial Precious Metals, Inc. (1/14/04; 10:08:28MT - usagold.com msg#: 115300) Your friend in the business, helping you enter the market with grace and confidence. http://www.usagold.com/Order_Form.html Rimh (1/14/04; 09:58:55MT - usagold.com msg#: 115299) ******** 427.10 ******** "Hi ! "My name is Ernst Welteke and I think that Germany should sell its Gold because its high time we put it to good use. Get rid of it so we can make better use of the vault and security personnel looking after all that flashy new Euro paper and..... what's that you say.... Oh, oh yes Germany's debts.... Well we have a printing press, too, you know, all the more reason to make room for more paper.... Zhisheng (1/14/04; 09:48:46MT - usagold.com msg#: 115298) Market Report Excellent analysis MK (i.e. I agree with it).Until the european central bankers put their money where there mouths are, I will not be impressed. USAGOLD Daily Market Report (1/14/04; 09:25:10MT - usagold.com msg#: 115297) Page Update! http://www.usagold.com/DailyQuotes.htmlThe Daily Gold Market Report has been updated.If you are considering investments in gold we invite you to request our free introductory information packet detailing the products and services offered by USAGOLD ~ Centennial Precious Metals. We welcome your inquiry and look forward to working with you."But speculators being what they are -- short-termers in every respect -- seem to have taken the Japanese and European positions to heart, and believe that something might come of this in the way of policy down the road. We have our doubts, and see this as another dip worth exploiting. After all, this is an election year, and the most interesting revelation with respect to the past two days events is that there is little doubt that Alan Greenspan and the Bush administration are agreed that a weaker dollar is in the United States' best interest. Before yesterday, though many believed that to be the case, there was no public confirmation. That came yesterday, and when all is said and done the markets will weigh that more heavily in the balance than this morning's utterances from Japan and the ECB." Husky (1/14/04; 09:24:09MT - usagold.com msg#: 115296) Contest ****528.30****Hi ! "My name is Ernst Welteke and I think that Germany should sell its Gold so there can be free caviar, champagne, beer and sex for all German citizens. Screw this 'investment' stuff. Party time for the fatherland. We deserve it." DryWasher (1/14/04; 09:08:30MT - usagold.com msg#: 115295) **** $ 415.0 **** Hi ! "My name is Ernst Welteke and I think that Germany should sell its Gold because like all politicians I am a crook and I want that Gold for myself and my friends. If the German Government sells it's Gold we can buy it at a bargain price. Simple isn't it. CoBra(too) (1/14/04; 08:56:08MT - usagold.com msg#: 115294) @ Mas - Re: Riverboat "The Privateer" Thanks for the snippets. Bill Buckler is one of my favorite reads and has been for a long time. And BTW, he also offers the conclusion to the parable - under the heading: "Closing Vise: The massive fall in the international value of the US Dollar since early 2002 is something that President Bush cannot do anything about. The real economic effects of such a massive fall in value of the US Dollar have yet to show up inside the continental US. They will."It means the US is dependent on the charity of strangers as Bill Bonner likes to say. When this "charity", or the willingness to offer 80% of the rest of the globe's savings to the US at an ever faster rate of depreciation dries up -the day of reckoning will have arrived. You can't spend your way to prosperity. This old axiom will again be proven correct and the US seems close to such a day.Trichet was talking about brutal forex volatility, clearly directed at the rapid free fall of the Dollar. The US response was to send AG over to Berlin to calm the waters. All he's achieved was closing out the roar of Niagara Falls behind sound proof doors for a brief spell. The roar will seem even louder after the doors open again for business as usual.Despite the li'l respite in the Dollar fall ... do you have acquired all the Gold and some of the Silver to let you sleep soundly at night?I never seem to feel that I've got enough and after many years of constant acquisition I'm at a loss due to rapidly changing environment of the monetary super (de-?)structure. Ah, shucks, maybe I'm becoming Uncle Scrooge - cb2 MK (1/14/04; 08:36:15MT - usagold.com msg#: 115293) News & Views http://www.usagold.com/AMK/MK-gold.html Updated.You are invited to visit now, often. Updated regularly. Stay abreast the gold market via News & Views, this forum and the Daily Gold Market Report.This is the website where serious gold investors congregate and keep in touch with the market. Please bookmark this page.New Stein.Bucking Up the Buck. R Powell (1/14/04; 08:29:21MT - usagold.com msg#: 115292) PPI The PPI number handed us a "buy the dips" opportunity this morning. Perhaps this is also a chance to see just how much strength is supporting both gold and silver. Silver traded as low as $6.37 this morning but didn't stay down that low but for a moment. I often wonder about investor sentiment which is reflected in that underlying strength (or lack thereof)supporting prices. Myself, I saw this downside move as a window of opportunity to buy. I immediately thought so. I certainly hope my gut reaction is correct. I also hope this feeling is much more common than the fear reaction that used to accompany any downturns. We should know shortly! How did you see this? Rich mas (1/14/04; 08:00:32MT - usagold.com msg#: 115291) Part III last one. My favorite. Gold is retaining your wealth, is it not?The River Boat Accountant's Principle:These are the simple observations of a boat owner earning his living bysailing back and forth across a small river between two different countrieswhere different currencies are being used. Over the past two years, hewould have seen the US Dollar fall in value by almost 30% while at thesame time he could read in the US papers that total national wealth stillstood at an enormous $US 50 TRILLION in terms of land, buildings,factories etc.. From his external perspective, it was a clear case thatAmericans had lost $ 15 TRILLION in cross-river terms in just two years. mas (1/14/04; 07:47:20MT - usagold.com msg#: 115290) Part II from Privateer Also think about the bond market after reading below."IT’S THE MONEY, STUPID":Remember candidate Clinton during the 1992 election? Here we are twelve years later, and it's theMONEY and all contractual or other forms of financial paper whose monetary unit of account happens tobe the US Dollar. In global terms, it does Wall Street no good at all to smile at the world because theDow recently got back to 10500, a level which hasn't been seen since April/May 2002.The reason for this is that a Dow of 10500 now and 10500 then have quite different global valuations ofthe US currency attached. On January 5, 2004, the Dow closed at 10544. The $US index closed the sameday at 86.35. The Dow's Jan. 5 close was the highest since March 19, 2002 when the index closed at10635. On March 19, 2002, the $US index closed at 117.94.Nominally, the Dow was only 91 points below its March 19, 2002 close of 10635 on January 5, 2004.But in terms of the $US index, it would have taken a Dow level of 14525 on January 5, 2004 to equal theDow's 10635 on March 19, 2002 - GIVEN THE FALL OF THE US DOLLAR IN THE INTERIM. Bythe way, in nominal terms, the Dow's all time high close was 11722.98 set on January 14, 2000.When a nation's currency is falling in international exchange terms, that process falsifies the nation'sinternal perception of the "value" of its financial assets. American's think the Dow is at nearly two yearhighs. In fact, it is down almost 27%, the amount the $US index has fallen since March 2002. The Dowhas regained its levels of March 2002, the US Dollar is down substantially from its March 2002 levels.It is right here where the situation turns drastically nasty. If one uses Warren Buffett's estimate last yearthat the value of all American assets stood around $US 50 TRILLION, then in terms of the Euro,Americans have lost many $US TRILLIONS of that wealth over the year as measured in Euro terms. Themore the US Dollar falls over the months ahead, the higher US "assets" must climb just to break even ininternational terms. Ahead, it could require that the values of these American assets must climb evenhigher than this. If they don't, then Americans are indeed staring at REAL economic losses.Here is THE problem which President Bush cannot run away from. mas (1/14/04; 07:42:24MT - usagold.com msg#: 115289) Compliments of the Privateer The other side of the coin.WHAT EUROPE KNOWSThe US stock market today is capitalised at 100% of GDP and total US debt is 360% of US GDP. Europeknows this. Europe also knows that President Bush is presiding over a US Federal budget deficit of (atleast) $US 500 Billion along with a merchandise trade deficit of over $US 500 Billion and that these twodeficits combined exceed the sum of $US 1 TRILLION. Finally, Europe knows that the US is borrowing10 percent of GDP to finance this consumption. Both kinds of deficits, whether fiscal orcommercial/financial, are consumption. US orders for durable goods unexpectedly fell 3.1 percent inNovember, led by the largest decline in computers and electronic products since July 2000. Europe is notlistening to the "happy days" chorus. Europe knows all this and reports on it all too.The Continental European Version Of - "Don't Mention The War":To get to the bottom of all this, you do have to know a European language, one of the "other" ones. It iscertainly not enough to rely on the British press, even if it is in English, because so much of it carrieseither a political or economic/national British purpose. One must know some of the continental languagesand seeking information in these certainly gives a rather different understanding.For example, one can discover the following, all of it laid out ever so politely and simply stated. Theoccupation forces (that was the only impolite part) which the United States maintains in an estimated 65to 70 major installations around the world (apart from the military's combat presence in Iraq andAfghanistan) are as follows: There are 120,000 troops based in Europe, another 37,000 who are in SouthKorea, and 45,000 based in Japan. Germany has more US troops than any other country, it has more than80,000. Now the double-barrel political point of this continental article was to ask whether mostAmericans really knew this. The answer is clear, they don't.The second point of the article drove straight to the real issue. It is simply this. ALL the local people inthe areas where the US troops are based, and have been for decades, know ALL about it.The last point of this continental European article was somewhat tongue in cheek. It was that if moreAmericans could be informed about this and reminded that the Second World War was over, along withthe Cold War, then it might be a very good thing if Americans themselves told the people in Washingtonabout it so that more of these American soldiers could all go home. If that happened, American deficitscould be reduced and American taxes could, perhaps, even be legitimately lowered.There are articles like this to be seen all across Continental Europe. Most are not nearly as polite. Gondolin (1/14/04; 06:49:04MT - usagold.com msg#: 115288) ****$445.00**** "Hi" my name is Ernest Welteke and I think Germany should sell its gold because the USA has promised to purchase it to replace their missing reserves, and will turn a blind eye to Germany finally retrieving our looted gold from the War to replace the gold we are now selling. steady (1/14/04; 05:44:57MT - usagold.com msg#: 115287) at what cost? the cartel may win ( i doubt it,) but they will be celebrating a PYRRHIC VICTORY> if they do! steady (1/14/04; 05:37:40MT - usagold.com msg#: 115286) BBBBBusted http://biz.yahoo.com/rb/040112/retail_lvmh_mstanley_3.html Morgan Stanley Fined in Paris Over LVMHMonday January 12, 12:23 pm ET By Trevor Datson PARIS (Reuters) - A Paris court on Monday found U.S. investment bank Morgan Stanley guilty of defaming global luxury leader LVMH in a landmark ruling which, if upheld, could change the face of investment research. Following a 14-month legal battle, the Paris Commercial Court upheld allegations by LVMH that Morgan Stanley's equity research had been biased against it, and awarded 30 million euros ($38.5 million) in compensation.The five-judge tribunal ......... continued! Slowman (1/14/04; 04:54:17MT - usagold.com msg#: 115285) Contest Please make that 442.20, it would help if I hit proper key !!!!! Thanks Slowman (1/14/04; 04:51:40MT - usagold.com msg#: 115284) Contest ****342.20****"Hi" my name is Ernest Welteke and I think Germany should sell its gold because America needs support having beaten us in a war, ITS PAY BACK TIME !! Belgian (1/14/04; 01:38:06MT - usagold.com msg#: 115283) Alan in Berlin.... Support the dollar ! Thanks. Goldilox (1/14/04; 00:33:00MT - usagold.com msg#: 115282) Export prices rise at eight-year high Export prices rise at eight-year high Export prices rise at eight-year high http://cbs.marketwatch.com/news/story.asp?guid=%7BC17C55DA%2DC093%2D4B70%2D808C%2DB19D9BDAF9E7%7D&siteid=mktw snippit:"WASHINGTON (CBS.MW) -- The weaker dollar helped U.S. exporters raise their prices in 2003 at the fastest rate in eight years, according to Labor Department figures released Tuesday.Export prices as measured in dollars rose 2.2 percent last year, the most since 1995. Most of the gains came in agricultural exports, prices for which rose 13.6 percent. Nonagricultural exports cost 1.3 percent more. . . . Similarly, prices of imports become relatively more expensive in dollar terms, a key motive for the Federal Reserve's weak dollar policy.Prices of imports, also measured in dollars, rose 1.9 percent in 2003, with petroleum accounting for about half the gains. Oil, which is traded in dollars globally, rose 9.1 percent in price in 2003. Nonpetroleum import prices rose 1 percent last year, the Labor Department reported.Canadian import prices increased 4.4 percent in 2003, while European Union import prices rose by 3.3 percent and Latin American import prices by 3.5 percent. Much of the adjustment in the dollar has come against the Canadian, European and Latin American currencies.By contrast, Japanese import prices fell 0.4 percent and prices of imports from Hong Kong, Singapore, South Korea and Taiwan fell 0.4 percent. Most of Asia has been trying to keep their currencies cheap relative to the dollar to protect their exports."Goldilox:Hey check it out - Japan got a 0.4% price increase on their exports to the US for their Gazillion Yen investment in the sawbuck! Hellava deal. Black Blade (1/14/04; 00:30:04MT - usagold.com msg#: 115281) CEOs' Confidence Slipped in 4th Quarter http://story.news.yahoo.com/news?tmpl=story&ncid=1203&e=6&u=/nm/20040113/bs_nm/economy_confidence_ceos_dc&sid=95609869 Snippit:NEW YORK (Reuters) - U.S. chief executives were less optimistic about the nation's economic prospects in the fourth quarter, with doubts about the future clouding their outlook, the Conference Board said on Tuesday. The private research firm said its measure of CEO confidence edged lower, to 66, during the last three months of 2003 from 67 in the third quarter. "The dip in CEO confidence was expected given the unsustainable pace of growth in the third quarter," said Ken Goldstein, economist at the Conference Board. "However, CEOs remain quite optimistic about the first half of 2004." But not as optimistic as before. Black Blade: Probably explains why corporate executives are bailing out with record insider selling. Well gotta get up early and get a healthy caffeine fix before hitting the road again. Good night all! Black Blade (1/14/04; 00:24:10MT - usagold.com msg#: 115280) G10 Bankers Say Currency Tensions a Risk http://story.news.yahoo.com/news?tmpl=story&ncid=1203&e=4&u=/nm/20040112/bs_nm/economy_g10_dc&sid=95609869 Snippit:BASEL, Switzerland (Reuters) - Japan joined Europe on Monday in expressing concern about instability on currency markets in a sign that central bankers of top industrial nations may be nearing agreement to try to slow the dollar's slide. Central bankers from the world's richest nations are meeting in the Swiss city of Basel to discuss the impact of the U.S. dollar's tumble on the global economy, plus topics such as a scandal surrounding Italian food group Parmalat and sweeping bank regulatory changes known as Basel II. Some Europeans have said the euro's gains of more than 20 percent against the dollar since the start of last year could stifle recovery in the euro zone. Bank of Japan Governor Toshihiko Fukui said on Monday that he agreed with policymakers across the globe that currency tensions are a risk. "The foreign exchange issue is an unstable factor for each country," he said before a meeting of central bankers from the Group of 10 nations at the Bank of International Settlements. Asian countries have played a key role in the euro's slide. Japan has repeatedly intervened on foreign exchange markets to slow the yen's rise against the dollar, while China has pegged its yuan against the U.S. currency. This means the euro has born the brunt of the dollar's decline. The Basel Committee on Banking Supervision meets on Wednesday at the BIS to hammer out final changes to the accord. Private sessions also were held at the BIS with commercial bankers, including executives from BNP Paribas, BBVA, Commerzbank and Citigroup. But they refused to discuss the nature or purpose of the discussions. Black Blade: Meanwhile Americans are expected to bear the grunt of the imbalances in international currencies. Interesting that the US has gone from the largest creditor nation to the largest debtor nation too. Goldilox (1/14/04; 00:16:31MT - usagold.com msg#: 115279) more MF manure http://biz.yahoo.com/rb/040113/financial_sec_mutualfunds_12.html sorry, I forgot the link-G specie-man (1/14/04; 00:15:35MT - usagold.com msg#: 115278) @ Black Blade - Yucca Mountain Yes he was involved with that. He also worked on what I believe was the biggest underground nuclear detonation in history - Amchitka Island. Goldilox (1/14/04; 00:15:15MT - usagold.com msg#: 115277) SEC: Fund Share-Touting Abuses Rampant snippit:"By Kevin Drawbaugh WASHINGTON (Reuters) - Brokerage firms regularly take payments from mutual funds to tout their shares ahead of others, U.S. regulators said on Tuesday, revealing a probe that showed 13 brokerages engaged in such "revenue-sharing" deals.In another blow to Wall Street and the $7-trillion mutual fund business, the regulators said they are investigating whether dozens of brokerages and funds "adequately informed investors of the conflicts of interest" of revenue sharing.The Securities and Exchange Commission, in a briefing on the findings of a nine-month inquiry, declined to name the 13 firms. Half of them, it said, kept their arrangements secret."Goldilox:Psst, buddy, wanna buy a bridge? More Mutual Fund manure! Gandalf the White (1/14/04; 00:13:37MT - usagold.com msg#: 115276) sorry all about the double post ! My son has given me a new computer keyboard with a "hair trigger" !<;-) Gandalf the White (1/14/04; 00:11:10MT - usagold.com msg#: 115275) TA TA TAAAAAAAAAAAAAAAAAAAAAAAAAAAAAA -- POG Contes UPDATE ! YES, all you Goldhearts, Sir M. K. has requested the FIRST CONTEST of 2004 be announced ! This contest will be a COMEX Feb. '04 Contract (GC4G) POG Settlement Contest.Sir M. K. said, "Let's make the WINNING prize (OF COURSE) --- a German KING "20 Mark" goldpiece (0.2304 oz. of Au), and the two RUNNERS-UP each win an one ounce U.S. Silver Eagle." "Each entry MUST be accompanied by the REQUIRED short statement !PLEASE READ THE RULES !<;-)===THE RULES -- (We MUST have RULES !!) 1) THIS Contest consists of TWO Portions --- A Price Prognostication and a short "STATEMENT" !2) The Winner is the Price Guess closest to the Settlement price of the COMEX FEB. 2004 Gold Contract (GC4G) on the date of WEDNESDAY, the 21st of January, 2004. HOWEVER, All "Guesses" MUST be posted before the clock in Denver strikes MIDNIGHT (24:00 MDT) on SUNDAY, January 18th, 2004.3) Price "Guesses" shall be stated in Dollars and tenths !(Such as $500.0) and shall be SHOWN in the SUBJECT BOX location AND enclosed in markers of "STARS", (Such as ****** $500.0 *******), so as to be OFFICIAL !4) ONLY one "Guess" per Knight or Lady is allowed, and once that "Guess" has been "taken" -- no one can duplicate it !! FIRST COME has rights to that "Guess".5) AND MOST IMPORTANTLY, to accompany the Price prognostication,--- Each guess must be accompanied with a completion of the following statement ---"Hi ! "My name is Ernst Welteke and I think that Germany should sell its Gold because --- (in thirty words or less)".===GOOD LUCK ALL !<;-)===Entries as of Wednesday 1/14/04 at 00:01 Denver time !!!In order of decreasing values !**** $462.5 **** Caradoc (1/12/04; 00:00:23MT - usagold.com msg#: 115131)**** $456.5 **** jenika (1/12/04; 07:49:34MT - usagold.com msg#: 115147)**** $452.0 **** Dollar Bill (1/11/04; 23:27:38MT - usagold.com msg#: 115125)**** $449.0 **** knotakare (1/12/04; 08:05:03MT - usagold.com msg#: 115149)**** $447.5 **** omegaman (1/12/04; 00:02:17MT - usagold.com msg#: 115133)**** $440.0 **** Zhisheng (1/12/04; 08:06:56MT - usagold.com msg#: 115150)**** $436.5 **** Operative (1/11/04; 23:40:48MT - usagold.com msg#: 115127)**** $435.5 **** Waverider (01/12/04; 23:41:52MT - usagold.com msg#: 115212)**** $435.0 **** Liberty Head (1/11/04; 23:52:20MT - usagold.com msg#: 115129)**** $433.2 **** mudr (1/13/04; 23:51:06MT - usagold.com msg#: 115264)**** $433.0 **** a nation of one (1/12/04; 11:37:26MT - usagold.com msg#: 115175) **** $432.5 **** steady (1/13/04; 17:43:12MT - usagold.com msg#: 115244)**** $432.2 **** Solomon Weaver (1/13/04; 17:44:29MT - usagold.com msg#: 115245)**** $432.1 **** Gandalf the White (1/11/04; 22:36:07MT - usagold.com msg#: 115123)**** $431.5 **** Goldilox (1/11/04; 23:48:09MT - usagold.com msg#: 115128)**** €333.0 **** Ernst Welteke (01/12/04; 09:24:45MT - usagold.com msg#: 115156)**** $430.5 **** balzac (1/13/04; 13:34:06MT - usagold.com msg#: 115239)**** $429.7 **** slingshot (1/12/04; 08:49:37MT - usagold.com msg#: 115152)**** $426.1 **** Black Blade (1/13/04; 22:28:35MT - usagold.com msg#: 115253)**** $407.5 **** Gonlyold (01/12/04; 18:38:37MT - usagold.com msg#: 115202)**** $342.1 **** FreeWillie (1/12/04; 03:30:29MT - usagold.com msg#: 115140)===<;-) Black Blade (1/14/04; 00:10:50MT - usagold.com msg#: 115273) Oil producers concerned by weak dollar: Qatar http://story.news.yahoo.com/news?tmpl=story&u=/afp/20040113/bs_afp/qatar_oil_dollar_attiyah_040113163858 Snippit:DOHA (AFP) - Oil producers are worried about the fall in the value of the dollar, Qatari Oil Minister Abdullah bin Hamad al-Attiyah said, suggesting it was inflating oil prices as there are no market shortages. "Producers are concerned about the weakness in the price of the dollar and the current price of oil is not due to a shortage in supply," the minister told a Middle East investment conference Tuesday. Attiyah spoke of the unease certain oil states, including some in the OEPC cartel, at the historic weakness of the dollar against the euro. "Changing from one currency to another is a difficult decision to take within OPEC," said the minister, without stating any position. Black Blade: This is just one of several recent article alluding to a change of pricing oil in euros. Looks like a topic of discussion at the upcoming OPEC meeting. BTW, I see that China is discontinuing export of oil to Japan and is rapidly increasing imports. Another rising player on the block for a diminishing resource. Goldilox (1/14/04; 00:05:18MT - usagold.com msg#: 115272) CNBC STAFF ORDERED TO SELL STOCK http://www.nypost.com/business/15557.htm snippit:"January 13, 2004 -- Business news network CNBC is barring its newsroom staff from owning individual stocks, The Post has learned.Management announced the new policy in a town hall meeting with CNBC employees yesterday.The new policy strengthens existing rules that require staff to hold stocks for at least four months and in many cases to gain approval before executing trades.The new rules require that top management, newsroom staff and on-air talent divest their portfolios of any individual stocks they own by January 2005, according to sources. The policy includes all spouses, dependants and relatives that live in the same household.These staff members can continue to own mutual funds and shares of parent company General Electric that are held in 401(k) plans.Staff outside the newsroom can continue to hold stocks they already own, but are barred from buying more. Their accounts are in effect frozen until they leave the company."Goldilox:Crash protection? Everybody out of the pool! Dad's orders!I wonder how that effects Jim Cramer, founder and largest stockholder of TheStreet.com? specie-man (1/14/04; 00:04:40MT - usagold.com msg#: 115271) US Dollar - Trade deficit effects The US Dollar has declined (20% ?) against the major (non-pegged) currencies in the last year or so. A lower dollar is usually the way the global economy balances out a trade deficit.But the US trade deficit has actually gotten WORSE, even while the dollar was declining 20%.The reason, of course, is that the two US trading partners that are most involved in creating the deficit are China and Japan - both of whom have a "peg" to the US currency.All this tells me that the US dollar has further to fall. It will have to fall far enough that the effects of pegging to the dollar (inflation in China and Japan) become intolerable. There is some evidence and "chatter" that this may be beginning to happen in China.Japan is still another matter. But like I posted last week, I think there is an "agreement" between Japan and the US that allows both countries to participate in a cooperative currency devaluation of the Yen and Dollar together. But the way that this is being implemented means that the dollar will decline MORE than the Yen.So I would agree that we are in inning 3 of 9, as far as the dollar decline goes. When we get to inning 9, the trade deficit will be much lower (maybe even a surplus). But when that happens, it will be because US consumers don't have the purchasing power to buy foreign goods.The US Federal Reserve seems to like any inflation except wage inflation (they hate it when ordinary citizens acquire too much purchasing power). So, as long as the job market is weak, asset/commodity inflation will likely continue.Actually, I believe the correct term for a "jobless" inflation is "stagflation". But this time, it might turn out to be "hyper-stagflation". Topaz (1/14/04; 00:00:38MT - usagold.com msg#: 115270) ...let's just call it a "dollar policy" http://www.futuresource.com/charts/micro.jsp?d=LOW&go.y=13&r=&p=D&b=line&s=dx1%21&s=gc1%21&s=fvxy&s=tyxy&go.x=12&v= DX 85! whooda thunkit? A totally contrived reflation. Sooner or later the average Joe is going to wake up and realise the futility of the exercise...and walk away!! ViewYesterday's Discussion.
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