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Welcome to the USAGOLD Gold Discussion Archives. The archives of this gold discussion forum are a treasure trove of information to educate investors about protecting their wealth through portfolio diversification with private gold ownership. The discussion forum also covers the wider issues of the past, present, and future role of gold in international monetary policy and the dynamics of the modern gold markets...   (Discussion Forum Hall of Fame) (The Gold Trail) ("Thoughts!" by ANOTHER)   The opinions posted by all guests are expressly their own and do not necessarily represent the views of the management or staff of USAGOLD - Centennial Precious Metals. The hosting of the public discussion shall therefore not be construed as an endorsement by USAGOLD - Centennial Precious Metals of any of the opinions posted here.

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ARCHIVED DISCUSSION FROM 2/15/1999
All times are U.S. Mountain Time

Gandalf the White (2/15/99; 22:23:53MDT - Msg ID:2441)
Mo TIMING
Peter -- at about the same 19:00 NY time, about 200 contracts moved the MAR S&P futures up over five points ! That is the vast majority of the volume on these contracts. SURE --- just coincidental.
<;-)

Peter Asher (2/15/99; 22:05:13MDT - Msg ID:2440)
Drop in POG
Looks like a direct response to a sharp rise in Dollar/Yen.
Same old tune.

Peter Asher (2/15/99; 21:40:53MDT - Msg ID:2439)
Goldfly
About living in N.Y. I don't know if there is a time requirment, but a remember when Bobby K. did the same thing he just got an apartment in the city and there he was. Senator from N.Y.

Goldfly (2/15/99; 20:43:07MDT - Msg ID:2438)
Has anybody here seen my friend Aragorn......?
Hey!! What happened to A3? He predicted a rhino, then a contest, then....... Nada!

Come on Aragorn, get your two grains worth in there! Tell us what the April contract will be on Friday!

Peter, can you imagine what direction Hills' scandals are going to go...... and how much bolder that gang will be if she has any success? (Does she live in NY?)

You know what I would like to see? Let's have Elizabeth Dole line up against the Iron Maiden in the race for the White House and see who comes out ahead. Do you suppose Mizz Rodham really thinks she can re-occupy the Big-O (Oval, that is) office?

GF

Gandalf the White (2/15/99; 20:39:47MDT - Msg ID:2437)
Peter -- strange timing !
Peter -- The Kitco Spot Au chart (which is SOMETIMES correct) shows that SPOT the dog was dumped one twice Downunder in "Ausieland" at just after 1900 NY time which just happened to be the time that the APR Futures opened for trading !!! Strange timing isn't that ? However, the GC9J APR Au contract that we are all guessing the next Friday's close was not overly active and fell the same $1.70 that SPOT the dog fell and then has corrected back up $0.50 while SPOT the dog is just laidout and resting. Not to worry Goldhearts, the same old tricks again. Just some more opportunities for us to gain in the longer run.
Steve -- please see my old posting of the impact of the BoJ's lowering of the discount rate to 0.15% to assist the commercial banks to purchase the flood of long Japanese Bonds that the BoJ has precluded itself from purchasing. This is the easy way to get the job done and save face !
How does one spell "Herrikarri" ?
<;-)

Peter Asher (2/15/99; 19:46:27MDT - Msg ID:2436)
They're Baa-ack! And They havn't even left yet.
Just when you think it can't get worse!! --- Hillary's going to run for Senator from N.Y.

To paraphrase Peter O,Tooles major line as Henry the 8th in Beckett, Will no voters rid us of these meddlesome Priests

Peter Asher (2/15/99; 18:57:22MDT - Msg ID:2435)
Thoughts anyone?
Globex S&P +5.70, Spot and GCJ9 down 1.70 !! Is this technical or are we missing some news item??

Peter Asher (2/15/99; 18:47:52MDT - Msg ID:2434)
Keeping A Lid On It
Today's posts have said a lot about the impending day of reckoning coming to the over-extended profiteers of the financial world. I have been toying with an analogy based on chemical explosions. We know (hopefully only via cinematic special effects) what a tank full of gasoline will do if converted into energy instantaneously. Yet, that same energy pushing a few tons of vehicle 300 miles is quite benign.

Likewise with the current markets. While I agree that the "Gang" will try to blame it all on Y2K if it does blow, I think they'll TRY to spread it out so that the excess gets bled off over time. The big question is how low can interest rates go before "killing the goose"? How much does the system need new capital, vis a vis how much does it need to reduce the cost of existing debt?

Given that "They" can take rates lower, the stock market bubble may be able to float along without bursting. I pleaded a case last month for a PE ratio of 30:1 being viable. Then, two weeks ago, a major analyst came out with a strong defense for 26/29:1 for stocks. (He may be a shill for the bad guys, but bear with me a bit here).

IBM came out with earnings of $2.44 for the quarter which was 20X annual. Then it sold off on the news that, even though earnings were up, gross revenues were down. This is bad?? Making more money on less sales? Now it's trading at 17X. What can you get at the bank — four to five percent? That's only 20-25X with no growth potential. Also, rates could go lower. (IMHO they will go lower or it won't matter what you're in, unless it's Gold!)

What I'm suggesting is that the "Gang" will try to nurse the game along while gently reducing the EXPECTANCY of the investing masses. Remember, the paradox of the stock market is that while higher earnings make stock more desirable, people choose stocks over interest-bearing instruments because of the appreciation potential versus fixed income, not because of any particular PE ratio. So. When interest rates get lower and lower, "high" PE ratios appear to be valid. It's the ALTERNATIVES that determine the desirability of stocks, rather than intrinsic value.

Therefore if "They" can pull off the lower rates, the investing public will still see stocks as preferable even though prices increase at a smaller and smaller rate. Then, if earnings increase sufficiently, PE ratios will decline, and the excess energy in the "bubble" will be let out gradually along the highway of time.

I'm not saying they can pull this off, but I do believe they intend to try, not from any benevolent intentions, but for the survival of their own wealth.

SteveH (2/15/99; 17:51:30MDT - Msg ID:2433)
Anybody care to tell me what the significance of this is?
Top Financial News
Mon, 15 Feb 1999, 7:48pm EST

Bonds, Futures Fall After BOJ Leaves Buying Policy Unchanged, Cuts
Rates

Japan Bonds Fall; BOJ Leaves Buying Policy Unchanged (Update1)
(Includes volume, section on spreads)

Tokyo, Feb. 15 (Bloomberg) -- Japanese bonds fell for a
second day after the central bank left its bond-buying policy
unchanged at a board meeting Friday, choosing instead to cut
overnight lending rates to spur the economy.

Bonds fell as the reduction in the Bank of Japan's target
rate for overnight lending between banks, to 0.15 percent from
0.25 percent, may not be enough to make bond yields more
attractive, traders said. Some investors also hoped the BOJ would
step up buying in the secondary market to absorb a flood of new
bond sales to fund economic stimulus packages.
"It looks like people are depressed because the BOJ didn't
meet some expectations" that it would buy more government bonds,
said Keiichi Tsukuda, a trader at Taiheiyo Securities Co.
"People could continue to expect the bank to buy government
bonds because that's the only way to have a direct impact on long-
term yields."

The benchmark No. 203 bond maturing in 2008 fell 0.42, or
209 yen per 50,000 yen bond, to 97.392. The yield rose 6 basis
points to 2.135 percent, below the bond's record high of 2.44
percent on Feb. 3. Bond futures for March delivery fell 0.35 to
128.70. About 38,133 contracts for March delivery traded, below
the 20-day average of 43,703 contracts.

Long-term rates have been on the rise ever since December
when the government announced its plans to sell 71.1 trillion yen
($629 billion) in bonds during the new fiscal year, which starts
in April. That's up 23 percent from this year.

Concern about a glut in the market has tripled the yield on
the benchmark government bond since Oct. 7, when it hit an
intraday low of 0.695 percent.
"A rate cut doesn't address the supply issue and therefore
doesn't help bonds," said Akitsugu Bando, a manager at Okasan
Capital Management. "Unless the supply issue is effectively
addressed, we could see rates rise to 2.4 percent during the next
three months.

Since the rate cut is widely seen as insufficient to lower
interest rates, the only way the market can absorb increased bond
sales without a jump in long-term rates is for the central bank
to increase "rinban" operations, or bond purchases in the
secondary market, said traders and analysts. The BOJ currently
buys 400 billion yen of government bonds on the secondary market.
"The expectation for a rinban increase wasn't high (last
week), but if the BOJ does eventually buy more bonds, it will
help the market," said Xinyi Lu, a chief strategist at Paribas
Capital Markets Ltd. "The market still hopes for an increase."

BOJ Governor Masaru Hayami said Friday all board members
opposed increasing the amount of government bonds purchased
through rinban operations. The central bank is under political
pressure to buy more government bonds to stem the surge in long-
term interest rates.

Steeper Curve

Investors are still reluctant to buys and take advantage of
the widening difference between short-term and long-term interest
rates. Today the "spread" or gap between the generic two-year
and 10-year government bond yields widened to 166 basis points,
approaching this year's record width of 186 reached on Feb. 5.
"We are seeing bond spreads widen further, but who wants to
take on the risk before the fiscal year end," said Bando.

Banks often take advantage of large differences between
short and long-term rates by borrowing with short-term securities
while making loans with a longer maturity.

Spreads

In other government bond trading, the price of the No. 209 10-
year bond fell 0.53, or 263 yen per 50,000 yen bond, to 98.026,
pushing its yield up 9 basis points to 2.240 percent.

Japanese bond yields don't reflect compound interest, which
is included in calculating yields on other countries' bonds.

At today's compound yield of 2.219 percent, the No. 209 bond
yields 284 basis points less than the 5.061 percent yield on the
benchmark U.S. 10-year note. That's 8 basis points wider than a
week ago.

The Japanese bond also yields 167 basis points less than the
3.884 percent on 10-year German bonds, assuming the latter paid
interest twice a year. That's 12 basis points wider than a week
ago.

The spread between the two-year and 10-year yen swap rates
widened 0.18 to 1.84. The two-year/10-year swap spread is one of
the indicators used by traders to gauge changes in the difference
between short-term and long-term rates.

SteveH (2/15/99; 17:47:39MDT - Msg ID:2432)
Ladies and gentlemen...
Read this about silver lease rates. Holy silver batman! (Oh by the way April gold just opened overseas -- volitile with good volume, now $290, opened at $291 (shorts are making there move before New York open -- and the rest of the world see what silver is going to do):

from kitco.com

Date: Mon Feb 15 1999 19:18
rhody (silver lease rates: One month lease rates were 11% to) ID#411440:
Copyright © 1999 rhody/Kitco Inc. All rights reserved
as high as 17% today in London. That's 4 to 9% higher than last
Friday. This is a new all time record for a one day spike in
silver leases. In fact 17% is an all time high for a one month
silver lease rate. It would appear that there was heavy demand
for borrowed silver, but few lenders. This weekend I searched
around in Mitsui, and came up with an article by Andy Smith
( not a fan of pms ) who states that gold in unsqueezable, as
all the gold ever produced is still above ground yada yada yada...

Yet another analyst ( writing for a period in January, just as
leases began to rise ) suggested that leases be rolled over for
longer terms, and that this silver rally would be weaker than
the Buffett spike of a year ago, and not as long lived. I wonder
what this guy is thinking now with lease rates of 17%!
Today we had the first wiff of a shortage of silver lenders.
If this is true, and not a product of the American holiday and
the Asian festivities, then Ted Butler's silver bull may finally
be awake.

USAGOLD (2/15/99; 17:16:36MDT - Msg ID:2431)
Quick Notes:
Hopeing II......Welcome to this table round. Pull up your chair. We hope to hear more from you. Strong first post.

Buena Fe.....Belly up to this er....table round. If we awarded the silver for courage, you'd have it.

Tico...Welcome...The stuff about volumes? I know its true. Just hoping to gain a little mo..............

Hobgoblin: Are hobgoblins related to hobbits? Now that you've broken the ice, we expect much more in the future.

Arizona Hiker....Thanks for joining the party. I agree with you on gold stocks, but in my view you have to separate the 'mine and sell' wheat from the 'hedge and forward' chaf (as you know)....the need for a knowledgeable gold stock broker is acute if you are an investor looking to play the mine stock game. I made the decision a couple years ago not to buy companies who played a big hedge book on principle alone -- a personal thing. My broker gave me the proper direction.

JA....I thought this to be an important statement so I cut it out of the remuda so everybody could get a good look at it:

"So the end is only a matter of time and they know that but I think they would like to pick the time-frame in which the end of the bubble is to occur. If the end can be delayed until Y2K then that event can take the blame rather than our
misguided monetary policy. Using this approach they figure they can stay in power to sell the people on a new misguided fiat approach. Like others have suggested I believe that we have had major inflation and it is being masked because it is all in this equities market."

Several CPM clients have voiced the same sentiment to me -- especially about waiting for Y2K as a cover for a financial crash. Then it's nobody's fault. "It's the machine's fault," as one client put it.

To All: I want to once again compliment all participants for the camaraderie, collegiality and cordiality that adorn this august FORUM. We watch this gold market together -- as friends and associates -- yes!

Buena Fe (2/15/99; 16:53:56MDT - Msg ID:2430)
Laughter!
It is propably clear, but just in case, my jibes are not directed towards anyone here at the forum (I lurk here often to maintain sanity) but since Friday's HaHa.. breakout in ...HeeHee.... rates HooooooHo... I keep hav.. HeeeeeHe.. having these fits o.. hooohoo.. of, well you all know what I mean! Haaaah Haaah
Is there a Doctor at the Forum!

HopeingII (2/15/99; 16:50:25MDT - Msg ID:2429)
Gold Close
**** $287.60 **** Friday February 19th

As a first time poster I would like to say hello to all and thank Michael for his most excellent site and also the opportunity to enter the current contest.

As I stare at my crystal ball this fine Monday afternoon I observe a number of circumstances that at the present time would appear to offer us suffering Goldbugs at least some measure of hope. To name just a few.

1) Rising U.S. and Japanese bond yields.
2) The recent spike in silver and silver lease rates.
3) U.S. coin sales going ballistic of late.
4) The degree of volatility of U.S. stock markets.
5) Ever increasing coverage of potential Y2K problems.
6) An increasing number of U.S. analyst's turning if not
negative, at least cautious.

However, my crystal ball also reveals a number of factors
that I interpret as being negative for the price of Gold in
respect to this week in particular.

1) Clinton and Gore's recent comments in respect to selling some IMF Gold. I personally can not believe for one minute that the purpose in so doing is to "HELP" some of the poorer nations on earth. No, the sole purpose of this rhetoric is the same old, same old, in order to suppress the POG. I believe there is a fifty-fifty chance we will hear more of this nonsense again this week, quite possibly Thursday afternoon or Friday morning.
2) The powers that be might well be even more opposed
to "ANY" increase in the POG this week should silver
continue it's advance. Can't have them both
moving upwards at the same time, might cause
some investors to think about PM's as an alternative.
3) Last Friday's weakness in the U.S. markets. Whether
it be manipulation (PPT) or simply those that now
believe in buying the dips, it's possible the U.S.
markets will have two or three good days this week.
If so, we all know only too well what that most often
means for Gold.
4) A number of other markets are closed for two or more
days this week. Could be the shorts will stage an attack.

In conclusion, sorry to be so pessimistic the first time posting but that's the way I see it. Lets all hope my crystal ball is as inaccurate as usual and the POG ends the week well over $300.00.

BEST WISHSES TO ALL


Buena Fe (2/15/99; 16:39:20MDT - Msg ID:2428)
2/19/99=+$320.50 Hee Hee Hoo Hoo Hoooo Ho - OOOH my belly hurts!
Somebodies gotta get a little "wild and crazy" around here.
If you think that I have had to much to drink just read 2nd Kings 7:1-20 (who would you rather be a leper or a royal officer?)

Just returned from Lurking the world over, sure seems to be a lot of fear brewin amongst the treasury departments of the G7+++. Seems they have lots of new bond suppy that needs to be absorbed, but the competition for buyers is getting a little heated. Rising rates are Gold's best friend for now!

AWH, its just a guess. Keep Well Everyone!

Peter Asher (2/15/99; 16:29:24MDT - Msg ID:2427)
Michael
How intriguing that I came across this note last night, and I just now read your post #2422. Some of this content has been in other posts of mine, but this in particular seems to fit right in with what you just said.

Economic Notes, Fall 1994 (updated for today)

The driving force behind society is economics, which, when truly defined, is the system by which who gets what. It is not supply or demand that ultimately determines the workings of an economic system. It is allocation!!

People deliver resources, produce goods and perform services, in return for which they receive certificates (i.e. money) with which to acquire the same from others. Therefore, it can be seen that money may be most accurately defined as a form of bookkeeping.

Unfortunately, as this form of credit exists in the framework of a commodity, it becomes a product unto itself, and much endeavor goes on in society solely for the purpose of transferring these credits from the possession of one person to that of another, even though no tangible product has been created.

We have, in the last two or three centuries, increased our productivity, in terms of man hours, perhaps twenty to fifty fold. Still, as a people, we have a substantial amount of those living-in- squalor that existed before the advent of the industrial age.

It seems that, as fast as the cost of products (in terms of man-hours) is reduced, the percentage of the population which profits by the holding of capital increases accordingly. Production of real resources, goods, and services is done by a smaller and smaller percentage of the people. Therefore, the obstacle to affluence and economic comfort for all productive peoples is that greater and greater portions of the population are engaged in activities which are legal, but invalid in terms of any useful product.

There is of course the factor of illegal predatory activity regarding drugs which is hopefully has past it's zenith of toleration. However, this kind of drain on mankind's work has existed throughout history in the form of war, etc. What is being discussed here are the factors that can be altered by agreement rather than by force.

The status quo is has been tolerated because people have seen themselves as living better than their ancestors. This permits the wealthy and the governments to maintain the inequities that persist in our society.

I don't have a solution to this dilemma, but it brings to mind some words sung by blues singer Amanda Ambrose, "If you don't want me stepping on you, then you get off the floor!"



Tico (2/15/99; 15:51:42MDT - Msg ID:2426)
friday spot gold 293
Hi guys. I'm new. First posting. Tough one. I'm going for resistance at 293.50 The shorts/manipulators/goon squad will have to let it look natural. They still have a lot of stuff going for them in the short-term. They HAVE to keep a lid on this thing for now. However, the weekly chart is making a VERY interesting falling wedge formation. Pretty bullish, but the trigger and breakout is yet to be seen. We are near, though. Every time we have tested the upper side of the wedge, since Sep98, the following decline has been with low volume on COMEX. Same thing with gold shares, and the volume patterns are even clearer there.

Arizona Hiker (2/15/99; 15:17:13MDT - Msg ID:2425)
Predicted Friday closing price for gold ***** $296.50 *****
Obviously, short term predictions are a challenge, but in the spirit of the game, I have my posted my guess for the Friday close.

All in all, we appear overdue for a test of the upper parts of this narrow range. I await, with my "brothers and sisters" for a true bull leg in the gold market and trust that we don't have long to wait.

I would add that while I have the greatest respect for Another, I do not share his opinion on the prospects for gold shares.

In our lifetime, we have never had a bull market in gold in this type of financial climate -- one in which zillions of independent investors manage their IRA rollover dollars, etc., while glued to CNBC.

IMHO (and based upon my observations of clients during the past eight years as a stockbroker), when gold finally moves to the upside it will result in a bull market in the mining shares which rivals the internet mania which recently transpired.

As most of you know, all of the mining stocks together, hardly have the market capitalization of a one big banking or drug stock on the NYSE. When money... real money...decides that it needs to own gold now... it is going to chase the mining sector.

Many of my friends and acquaintances could not even tell you how to go about buying a gold or silver coin or ingot. But they do know how to get on the internet and put in a market buy order for a gold mutual fund or ABX. And that is exactly what they will do. In numbers that you can not possibly dream of.

Go gold...go farmland...go anything real.

Gold Dancer (2/15/99; 15:11:46MDT - Msg ID:2424)
Gold Price
$301.10 is my entry price. Like JA I see the year 2000 as a significant influence but from a different angle. A few bright men decided how to have a party about 5 years ago and began the gold carry trade where by they managed to take
a low interest gold loan, sell it into the market, and leverage that money up to 100 times in value in the derivitive markets and the bond markets. It worked. But it worked better than they thought. The public bought it hook line and sinker! Yes, a few men control things or so they thought until the public with its billions and billions and billions piled into the stock markets driving them so high
as to do two things. First they have convinced even the few
bright men as to the "realness" of what is happening. These
few bright men now really believe that there is a new era.
How else can you explain LTCM getting caught? Second, it has
become clear to the powers in charge (Clinton, Greenspan, Rubin) that they GET their power from the bull market. The
markets are so much bigger than they are that they are merely trying to keep their power alive. At all costs!!!

Now take the year 2000. The people sense a big party is
going on. They can sense what will happen afterwards. But for a party to end the last of the quests have to leave. And most of them are still at the party. There is no reason to
expect the party to end before the change of the millenium and probably not until well into the first quarter of the year 2000.

Gold stocks and gold have never done well during a crash in the markets. They never will. They do very well at the tail end of a party. So from here on out they are going to be the big winners going into the year 2000. The internet
players are going to come to the gold party. This is the best hope and the best senario for profits. Huge profits.
They are slowly on their way and hence I will add $10 to JA
price. The party is not over for another year and we gold
bugs are just arriving. Let's enjoy our selves and stop thinking in terms of a crash in the Dow as a necessary condition. It is not. Next week begins the visable bull in gold and $301.10 is on its way.

Thanks, GD

Hobgoblin (2/15/99; 14:57:50MDT - Msg ID:2423)
***300.20*** April Gold close on Friday February 19th
I came to lurk these sites because of my Y2k concerns and a simplistic belief that in times of crisis the POG goes up. If we are to see a such a big move then it really should get started soo; the fireworks can come later, but it needs to start building soon. POG has laid some foundations, is it time to raise it's head above the parapet?

Gold is still inside it's bear channel and the chances are she stays there.
However, though I wouldn't buy it till she breaks; the charts with their nice pert triple bottoms/head and shoulders/stochastics etc say to me;
If there is a good time to breakout it is now; lets piggyback Silvers ride up.
So what the hell, the hobgoblin says subtract Feb high from the 99 low and add to 291.50 to give the total of $300.20
HaHa!

USAGOLD (2/15/99; 13:45:26MDT - Msg ID:2422)
Peter....
I think the problem in the mining companies is the same that permeates the investment business as a whole -- the live-for-today-I-want-instant-gratification "mind set" that infects the psychology of our times and by extension all the markets. Many of these gold mining executives don't give a hoot about gold or the gold mining business -- it is simply fertile ground for their brand of pillage and burn corporate finance ala the gold carry trade. For these people, the gold mining business simply acts as cover for financial gambling -- a more genteel and socially acceptable version of LTCM. They hope and pray everyday I am sure that the sham of the gold carry trade doesn't blow up in their hands before they find another industry to pillage. This reminds me of an across the fence discussion I had with a neighbor whose family has been in the oil business for at least three generations. Her brother now in his fifties started out his career in the same oil company that his grandfather and father worked for. He was sent packing after the third or fourth merger and he could no longer hold onto his position. By the time he left, the oil business had very little effect on the company's bottom line. Their money was made in the "financial business" as she tells it and this process of evolution occurred over the last ten years of this on-going financial mania. He told his sister, my neighbor, that most of the people in the corporation do not even know what business the company's really in. They just push paper all day and hope they keep their jobs -- an absurdity right out of one of Tom Wolfe's novels. I asked her -- not a financial type -- what she thought the end result of all this will be. She said "We are going to have a major crash. The whole economy's phoney and everybody knows it." I agree this debt-fueled-live-for-today-I-want-gratification-now-mania cannot have a happy ending.

Gandalf the White (2/15/99; 13:45:00MDT - Msg ID:2421)
JA --- THAT was a GREAT explaination !
Thanks for your understandings and thoughts ! My eyes see what my brain was trying to tell me, but could not get through my thick skull. Come on you other Lurkers, let us hear your thoughts. Knowledge is to be shared, or only stagnation results.
<;-)

JA (2/15/99; 12:30:16MDT - Msg ID:2420)
Price of Gold
***291.10*** April Gold close on Friday February 19th


I hate to be a little bit of a pessimist here but I think this gold market needs a little more time before it breaks out to the upside. I actually hope I am wrong but will attempt to make my case for the above posted price. On Friday gold touched the bollinger top and then backed off a little bit. If gold can close above 293.50 by the end of this week then based on my commodity charts it has broken a fairly significant trend-line and could be off to the races. That's also why I think the manipulators have to establish their next line of defense at the 293.50 level.

I would agree with others that Friday's bonds will cause a shock to the system and should be causing significant alarm. The march futures contract gapped down and then closed near the low for the day. I would suspect as others have suggested that there is some repatriation going on. Again I think the insiders will be called in to prop up bonds for a little bit longer and Japan may be asked to wait before their next round of repatriation.

The US dollar index hit a short term double top and also a bollinger band top and then closed near the low of the day. This may be a key reversal sign, again I think this all points to the necessity for some type of major intervention either by a major news release or some central bank action. I think of last fall and the obvious interventions with LTCM problems and I ask myself, do the powers that be have some dry powder left, I have to answer that I think they do. I believe one of their objectives has been accomplished, that of propping up the market until the end of the Clinton impeachment trial. Now they will try to continue to buy time.

The insiders are bright men and have to know that we are sitting on the biggest stock market bubble in history. While the masses may not know it these people do. So the end is only a matter of time and they know that but I think they would like to pick the time-frame in which the end of the bubble is to occur. If the end can be delayed until Y2K then that event can take the blame rather than our misguided monetary policy. Using this approach they figure they can stay in power to sell the people on a new misguided fiat approach. Like others have suggested I believe that we have had major inflation and it is being masked because it is all in this equities market. We also have this huge balance of payments issue with Japan and China and Europe holding US dollars that will eventually come home, particularly when the dollar begins to drop. We may have seen some of that on Friday as others have suggested. If I were Greenspan and Company I would try to keep it all propped up until Y2K issues occur thus providing release and something to blame the whole fiasco on.

I don't necessarily believe we need to reach the year 2000 for the issue to get the blame but we need to get further into this year to make it all believable. Unfortunately I suspect the Insiders will not come up with a solution that has the United States best interests in mind. Their policies have falsely enriched us more than is warranted, the next phase I suspect will be much more harmful than is warranted. Gold should provide some protection.

All of this to project that Gold will trade in a narrow range this week and close at 291.10 on Friday


Peter Asher (2/15/99; 11:50:48MDT - Msg ID:2419)
Michael
This makes me wonder a bit more about that Australian miner's statement last week. About the big mines willingly operating at a loss, hoping to ride out the storm until the little guys fold and can be bought up for peanuts. To me the biggest mystery of the continued low POG has been the fact that the mines seem to accept it and sell forward at the slightest pop in the POG.

Peter Asher (2/15/99; 11:40:53MDT - Msg ID:2418)
Michael
The item is now gone from the menu but my sense of it was that, due to the low POG, they ran in the red until the money ran out.

USAGOLD (2/15/99; 11:12:04MDT - Msg ID:2417)
Peter...
Was that a gold loan default?

Peter Asher (2/15/99; 10:58:57MDT - Msg ID:2416)
On Exite News
Canadian gold miner Royal
Oak seeks court protection
(Last updated 12:33 PM ET February 15)


Eacott said the company would release further details
about the court action later Monday.

Hard hit by falling gold prices, Royal Oak stopped
paying interest on more than $320 million in debt in
late December and told creditors they had until
February 15 to restructure the payments.

USAGOLD (2/15/99; 10:37:58MDT - Msg ID:2415)
Contest...
The contest ends tonight at midnight. Last chance for all prognosticators to get your best guess before this esteemed FORUM.....to win a gleaming one-tenth ounce Austrian Philharmonic.

Rules can be found in the morning archives for the past two days.

USAGOLD (2/15/99; 09:54:53MDT - Msg ID:2414)
Today Market Update: Squeeze Adds 14¢ to Europe Silver Price
MARKET UPDATE (2/15/99): The COMEX is closed today and the quotes above are relative to early European trade today. The silver story continues to dominate the precious metals sector. In Europe overnight, silver lease rates spiked into the lower teens with much pressure on the forward market spilling over to prices on the physical metal. Lease rates
stood at 7% on Friday. These are the classic indicators of a short squeeze in process. With no metal available in the market to lend so that dealers can make their forward sale
commitments, shorts are being forced into the market to buy up whatever physical metal they can find. This is precisely what we have predicted will happen eventually in the gold market -- on a massive scale. We can watch the silver market now as a possible template for gold in the future. According to the London Reuters report this morning one trader was quoted as saying: "Further borrowing of silver this morning has taken lease rates and the spot price even higher. Silver will remain volatile, and with New York out on holiday today the thin markets will only serve to aggravate the tightness." With the commercial gold long position growing on the COMEX as well, a similar situation could be developing with the yellow metal. Shortages and premium pressure could develop overnight. A London trader was quoted by Reuters this morning as saying: "Are we going to see prices in the mid to high $290s by the end of the week? Possibly, but I think this is all technically driven."

That's it for today, fellow goldmeisters. We will update if anything interesting develops.

Silver Tongue (2/15/99; 07:23:06MDT - Msg ID:2413)
Thanks Basil
Thanks for the tip Basil. It works great. Hopefully gold will remain afloat and begin takeoff.

Basil (2/15/99; 06:04:37MDT - Msg ID:2412)
Silver Tongue--European PM Prices
Correction, sorry http://www.quoteline.com/astmete.asp

Basil (2/15/99; 05:59:33MDT - Msg ID:2411)
Silver Tongue--European PM Prices
Try the following http://www.quoteline.com.astmete.asp

Basil (2/15/99; 05:51:38MDT - Msg ID:2410)
Silver Bag Melt Premiums
Had not been watching this, but observed Friday that premium now exceeds 30 percent over melt! Has it EVER been this large before?Does anyone know what gives?Y2k purchases?
Also,at this level might junk silver bags qualify as "numismatic" for reporting purposes?

Silver Tongue (2/15/99; 05:28:37MDT - Msg ID:2409)
gold price
Does anyone know how to access the world gold price when the US markets aren't working? It appears that gold was up
another 10 cents per ounce last evening but I don't know if my source was right or not and it certainly is not current now.
Kitco is not current last time I checked. I need to leave town more frequently. Gold and silver seem to do pretty well when
I am on the road.

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