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ARCHIVED DISCUSSION FROM 8/15/2005
All times are U.S. Mountain Time

(Yesterday's Discussion.)

Goldendome (08/15/05; 23:55:30MT - usagold.com msg#: 135012)
$ Bill, The U.S. is suffering the fruits of it's success.

Cruel irony for the U.S. that it now faces the establishment of a much more strictly Islamic government in Iraq than the dictator who was displaced. Certainly Sadam had his faults, but his was a much more secular government than nearly any other in the region. Sadam made sure that the religious factions and clerics knew who was in charge...and it wasn't Islam!

The removal of a strong Iraq removed the counter balance to the strongly Islamic states in the region, particularly including the Iranians. Just as water flows when a dam is broken, so too will power flow to fill the void in Iraq. Can the Iranian government be blamed if their zealots flow to assist in filling the power void in Iraq that the U.S. created? How would they be stopped? We can't even control our own borders here in the United States for Pete's sake. These people by tradition, culture, religion, and experience are certainly not like us. That is a mistake that we have been making all along; to expect the people of the middle east to adhere to our rules in government and national undertakings.

You state that the purpose of the reserve currency is to inflate. That's shedding a new thought on what has obviously been happening, particularly since 1971. Certainly then, you agree that the U.S. dollar is no long term store of value. More reason to buy and hold gold for those savings.

Again, Best, G-dome

Goldilox (08/15/05; 23:20:22MT - usagold.com msg#: 135011)
7.2 EQ off the coast of Honshu
http://earthquake.usgs.gov/recenteqsww/Quakes/usbvae.htm
About 220 miles notheast of Tokyo.

Goldilox (08/15/05; 23:07:47MT - usagold.com msg#: 135010)
Fannie Mae "conundrum"
http://www.jsmineset.com
snip:

Comment: Why do they not know the commitment and market prices of every instrument that they have purchased? This is absurd. How can you value something if you do not know the market price, or if there is no market price? How can you hold it on your books as if there was a market for the asset? It is customary to value illiquid assets at a discount from the price one paid, or at most, at an amount equal to the price paid. Has Fannie Mae, and perhaps many other derivative holders, been misrepresenting the value of their derivatives? If it is true that they do not know the value of their derivatives on every day of the year, how have they priced them in their historical financial statements?

Is it not the responsibility of the company holding derivatives to accurately represent the value of these contracts? If they do not know the exact value, is it not their responsibility to say so and to take a conservative stance on the value of these illiquid assets? A derivative is a complicated instrument and depends on the financial solvency and good will of all counter parties to the contract, and of any future purchasers of the
contract. How does Fannie Mae, or any other derivative holder monitor that?

In my opinion, the accounting profession and the corporate holders of derivatives have to get their hands around this big and growing problem. Fannie Mae is a big example, but many, many financial institutions of all
types, and many other corporations are parties to derivatives, and they are unable to know the accurate value of these contracts. Yet, there is no clear way to explain to readers of Fannie Mae's financial statements just how much risk the company has taken on. This leaves many groups; investors, creditors, suppliers, and others without a clear picture of the risks involved in doing business with a specified company. Many parties, such as those listed above, have been taking Fannie Mae's statements at face value, and yet the company and their accountants cannot be sure that the financial statements reflect the actual values. Many experienced, and thus cynical observers of the situation, believe that the derivatives may be much less valuable, or may carry much more risk, than they had been led to believe.

-Goldilox

Monty Guild's comments on the FNMA derivatives mess. See the link for the full context and the reference source.

Goldilox (08/15/05; 23:00:11MT - usagold.com msg#: 135009)
Come on, Bill
Rummy didn't "overlook" Saddam's torture and genocide. He supplied the helicopters, bio-technology and "advisors", all while Ollie North was supplying the Iranian Mullahs on the other side of the conflict. He was also on the board of the Swiss company that sold North Korea their reactor in 1998. By the way, they both supplied bin Laden's boyz in Afghanistan, generous arms purveyors that they are.

Were the Shah, who the CIA propped up after their coup of Iran's democratically elected non-religious government, or Noriega the Bush's designated coke dealer that ratted them out, or let's go one step futher, Pinochet the Butcher all great for their people?

This is the kind of friends the corporate raiders support to assist in first world mass consumption of the third world natural resources.

No doubt the guys you mentioned are not "nice folks" (rulers NEVER are), but they pale in comparison to the genocide committed by the super powers and their resource wars of the 20th century. More that 100 million died at human hands in the "century of genocide."

I personally don't care if the women in Iran have to cover their head. The Catholics in America must do the same when they enter a church, even as a tourist.

Every culture has some very peculiar laws and some very unfair practices, even the US. It's not a good thing to eliminate all cultures and homogenize everyone to one set of global rules as the result is the NWO you seem to detest so much.

PRITCHO (08/15/05; 22:48:12MT - usagold.com msg#: 135008)
Death & Obligations - - - - -

In case anyone on this board has the misconception that being dead will releave you of your obligations and concerns, this should resolve the issue.

This is so priceless, and so easy to see happening, customer service being what it is today.

A lady died this past January, and Citibank billed her for February and March for their annual service charges on her
credit card, and then added late fees and interest on the monthly charge.The balance had been $0.00, now is somewhere around $60.00. A famil ymember placed a call to Citibank:

Family Member: "I am calling to tell you that she died in January."

Citibank: "The account was never closed and the late fees and charges still apply."

Family Member: "Maybe, you should turn it over to
collections."

Citibank: "Since it is two months past due, it already has been."

Family Member: So, what will they do when they find out she is dead?"

Citibank: "Either report her account to the frauds division or report her to the credit bureau, maybe both!"

Family Member: "Do you think God will be mad at her?"

Citibank: "Excuse me?"

Family Member: "Did you just get what I was telling you -the part about her being dead?"

Citibank: "Sir, you'll have to speak to my supervisor."
Supervisor gets on the phone:

Family Member: "I'm calling to tell you, she died in January."

Citibank: "The account was never closed and the late fees and charges still apply."

Family Member: "You mean you want to collect from her estate?"

Citibank: (Stammer) "Are you her lawyer?"

Family Member: "No, I'm her great nephew." (Lawyer info given)

Citibank: "Could you fax us a certificate of death?"

Family Member: "Sure." (fax number is given)

After they get the fax:

Citibank: "Our system just isn't setup for death. I don't know what more I can do to help."

Family Member: "Well, if you figure it out, great! If not, you could just keep billing her. I don't think she will care."

Citibank: "Well, the late fees and charges do still apply."

Family Member: "Would you like her new billing address?"

Citibank: "That might help."

Family Member: "Odessa Memorial Cemetery, Highway 129, Plot Number 69."

Citibank: "Sir, that's a cemetery!"

Family Member: "What do you do with dead people on your planet?"

PRITCHO (08/15/05; 22:15:46MT - usagold.com msg#: 135007)
@ Another pointless Rant - -- Oops forgot the medication- again
Most importantly repeat - - i before e except after c !

Dollar Bill (08/15/05; 21:41:56MT - usagold.com msg#: 135006)
.,.
The French and the Germans have a few reasons for moving Iran toward the security council dont they? If Iran does the euro bourse, the euro value increases, which the EU certainly seemed to not like in the winter when the euro value went to what? 124? Whatever, they didnt like it.
If iran wont listen to them about the threat of war ifthey continue with the enrichment process, how will Iran listen to other concerns of the French and Germans ect if the iranian become kingmakers via oil and euro economic warfare? The iranians are run by the same kind of guys these countries are expelling as undesireables.
12 mullahs as power brokers internationally must look less lovely as each day passes.
Saddam had a long term freindship with chirac. saddam did have western tendencies that chirac felt were enough to allow him to overlook saddams horrid torture of his citizens. Hell, the US was siding with other mideast tyrants and thieves, Chirac had his oil guy, whats the dif?
But this Iran bunch...........now there is hardly a redeeming feature to them. At this late point, the embrace of the euro by this iranian crowd must look and actually be like a embrace of a tar baby that is just too, way too.....well.............religious!
Not exactly enlightenment material!
Chirac must view this all as like being stuck between a rock and ahard place. Can the euro countries really afford to take a walk with Iran as saviour of the euro?
Isnt that kind of saving just death in disguise at this point? The point of being reserve currency is to run deficiets I believe. Cant france and germany run deficiets now that the US is hosting an infinite debt model and hints it is moving towards power shareing? Would having Iran at the chokehold of your currency strength give you sleepless nights?
12 mullahs decide they dont like your law about girls wearing those hoodhats, and you have a currency crisis on your hands. Wont allow certain moslem wishes fulfilled in France? Ooops, your oil, oooops, your currency might be effected. We didnt mean it, some guy in charge of hitting the right switch went to prayers and forgot to do this or that. You understand right? Dont squack or we might deal in dollars. I just cant imagine the french and germans wanting this iran bourse, or the iran nukes.

PRITCHO (08/15/05; 19:54:11MT - usagold.com msg#: 135005)
More BS - - Now we Get AN Internationally Recognised Speaking Out - - Again!
http://www.safehaven.com/article-3598.htm
Highly Questionable US Employment Gains!
by Marc Faber


PRITCHO (08/15/05; 19:33:37MT - usagold.com msg#: 135004)
From Richard Russell - - - - Latest Comments
http://www.dowtheoryletters.com/DTLOL.nsf
This guy is good.(Age 81 so been around the floor a few times:) He writes an interesting article 5-6 times a week & theres ALWAYS something there to grab hold of. Recommeded.

SNIP 1
August 15, 2005 --
Random and disjointed thoughts from the Russell underground. The chart below is courtesy of my old friends, the inimitable Aden sisters ("Aden Forecast"). Is there a connection between the price of oil and the price of gold? Well, they both represent a type of wealth, and they do call oil "black gold." And I guess you can say that gold is wealth you can hold in your hand, while oil is wealth that resides in the ground. Everything of value is related to everything else of value, and you can always plot the price of one in relation to the price of the other.

The chart below shows the ratio of gold to oil over the last 20 years. Oil's price has recently been surging to record highs, and gold in relation to oil has been declining to its lowest levels since the '80s. The chart suggests that gold is now "too cheap" in relation to record high-priced oil.
---------------------------------
SNIP 2
How about these statistics? The US is now graduating 60,000 scientists and engineers yearly. China and India between them are graduating 500,000 scientists and engineers a year, and they are not being handicapped by a "faith-based" government.

"Chindia" is the new buzz-word for the combination of China and India. The current issue of Business Week features China and India on its cover. One article starts, "At an elite tech school near Calcutta, someone is trying to invent the next Blackberry, but one that will sell at a fraction of the US price. Outside Bombay, they're putting the finishing touches on a $2,200 people's car. In a world-class Shanghai lab, a Chinese team is mapping breakthrough cancer research."

If you read the above paragraph and it doesn't start you thinking, then, dear subscribers, you're not seeing the picture. The picture is increasing world competition coming from one-third of the world -- a third of which is very hungry, a third of which is just joining the game. It's a third of the world that wants the good life, the kind of life that you and I enjoy.

I have no idea how it's all going to turn out, but I do believe that we have massive problems ahead, and that we may be on the wrong track.

The US will not continue to be master of the world. The way to power in the future will not be through military supremacy. The US is losing power via our zero savings rate and our loss of our manufacturing base.

There must be, and will be, a leveling process, and that leveling process will probably result in a decline in the US standard of living while China and India and Asia improve their living standards. They are the savers while we are the spenders. They are the producers while was are the consumers.

The power of the US lies in the rest of the world's willingness to accept US dollars. This cannot last, when the nation that issues the dollars is a nation that is running endless deficits.

Gold always gravitates toward the powerful and the successful, both in individuals and in nations. Gold is now moving toward Asia.

Somewhere ahead the US economy will falter, then decline. That will be deflationary. The Federal Reserve will not tolerate deflation, since deflation renders the Fed impotent. To fight deflation, the Fed will open the floodgates of fiat money creation. They will send short rates to zero if need be. Under those conditions, gold will move into its third frenzied phase. Interest in gold will then be the opposite of the disinterest that we see now.

The primary bull market in gold that started in 2001 continues to be a hidden non-event as far as the great majority of investors are concerned. They don't know it exists. And the chart below shows you why. Gold has moved up in steps, each step followed by a "discouraging" correction. But when you view the big picture as seen in the chart below, you see that a primary bull market is very much in force.



PRITCHO (08/15/05; 19:24:51MT - usagold.com msg#: 135003)
Answer To an Oft asked Question ? - - A SLOW BOAT TO CHINA OR HOLLYWOOD HUBRIS?
http://www.financialsense.com/Market/wrapup.htm
Market Wrap Up -at a neighbours site.

This a very well thought out article-- It explores & gives reasons why the Baltic Dry Index [the spot cost of hiring a ship] has sunk so low.Right out of the box and well worth the read.
Follow the link for a good read.

CoBra(too) (08/15/05; 17:34:23MT - usagold.com msg#: 135002)
@968 & Goldi
In my mind it was Paul Volcker, who went all out with blazing guns to fight inflation. Interest rates went up to almost 20% on US $ debt instruments (GMAC issued a Euro Dollar debenture even higher). Recession followed, but the Dollar was saved for another day and recouped almost all its losses vs. all major currencies.

A feat to repeat today would in essence crash all markets and economies, due to the gigantic debt levels accumulated since. Debt, now dubbed credit in the US Seignorage $ Reserve system has become irredeemable.

I know, the next bone you'll be throwing my way is going to be why big Al is rising interest rates. Well, whatever else can he conceivably do to get out of his conundrum (flattenming yield curve) and pass the last months of his reign in some dignity. Mr. Bubbles may well pierce some more of his self inflicted bubbles by raising rates 1/4 too many yet, leaving his presumed successor with no more choice as to resort to the Bernanke "chopper" money.

MTM would be a great thing, though first you would have to know your markets - and then you would have to return to a reliable value of your medium of exchange. If the medium loses value at the rate the reserve currency has lost over two years time vis a vis its (not stringently pegged) trading partners, then any hedging on a future delivery of a product becomes obsolete; And the only hedging would be against the pre-dominant medium of exchange...An abomination per se in the meaning of future contracts - as in most of all derivative trading today and the massive advent of hedge funds ... The largest being the monstrous US banks, accompanied by the UBS' and DB's of the world! Still wondering wherever they wann'a find counterparties, though that's a pretty idle question.

Sorry for being long and obstinate - No, only the former ... cb2









Goldilox (08/15/05; 17:20:17MT - usagold.com msg#: 135001)
FYI Sports Fans
For those who remember when sports was fun, the Little League Mid-Atlantic Final is on ESPN2 right now.

The NJ leadoff batter brushed off some "chin music" and answered with a shot over the LF bleachers.

No one is holding out on "contract disputes". Now THAT's baseball!

Goldilox (08/15/05; 16:48:49MT - usagold.com msg#: 135000)
Silver Round
I received my silver round in the post today. It's beautiful!

I'm never much good at "guessing", so you finally asked something I knew the answer to! LOL

Thank you MK, Marie, and CPM staff for this lovely addition to my collection!

Goldilox (08/15/05; 16:45:31MT - usagold.com msg#: 134999)
1980 demand fall
@ 968,

That's a really good question. Does anyone remember that period wll enough to describe the "fall fom grace" after $840/oz.?

968 (08/15/05; 16:27:31MT - usagold.com msg#: 134998)
@ Cobra(too)
In these periods, the POG was still "a political" priced POG, as it still is today ! A POG in a dollar cage.
And did the demand really suddenly fell in 1980 ?

So why will the POG rise, according to your thoughts, by lack of supply, or by a failing fiat monetary system ?

And if all fiat monetary systems fail with a rising POG, what is the difference between a Central Bank that uses a fixed POG for valueing goldreserves, and a Central Bank that uses an MTM-system ? Why doesn't the US uses a MTM system ?

mikal (08/15/05; 16:20:54MT - usagold.com msg#: 134997)
Asia's Treasury Appetite Matures
http://news.ft.com/cms/s/4205f858-0dce-11da-aa67-00000e2511c8.html
Asian Diversification Hits Treasuries - Jennifer Hughes - August 15, 2005

CoBra(too) (08/15/05; 15:59:50MT - usagold.com msg#: 134996)
@968 - re: gold supply/demand
just to pick out a few dates where physical gold demand overwhelmed available supply - how about 1933/34 when gold posession was made illegal in the U.S. Also with the demise of the London Gold Pool 1968/69. And last 79/80 when the CBs again lost a major and unbearable portion of their gold "reserves".
... And resounding yes, as a wealth asset. Precisely, as the fiat monetary systems had to be preserved by all means for another (merry-go)round ... until the pressure became to great!

It will happen again! cb2

BTW, I'm also hoarding physical silver, which unfortunately has a VAT of 20% in the EU, while gold has none - Ha, why? Because it's just a commodity, or isn't it?








USAGOLD Daily Market Report (8/15/05; 15:01:14MT - usagold.com msg#: 134995)
Page Update!
http://www.usagold.com/DailyQuotes.html
The 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.

Monday Market Excerpts

August 15 (from MarketWatch) -- Strength in the dollar brought pressure to bear on precious-metals prices after a Treasury Department report showed capital inflows into the United States accelerated in June as foreign investors snatched up a record amount of corporate bonds.

COMEX December gold closed at $447.60, down $3.80.

Gold futures climbed over the past three sessions, posting an advance of nearly $9 an ounce last week.

"There's a bit of long covering ... with people taking profits" in the gold market, said Thomas Hartmann, an analyst at Altavest Worldwide Trading.

"Gold has been following crude -- both are taking a breather," said Charles Nedoss, an analyst Peak Trading Group in Chicago. Oil prices lost ground but remained above $66 a barrel.

Overall, however, "the gold charts look very constructive -- this looks like profit taking after last week's run," he said.

Gold has "every reason to pause, consolidate or pull back short-term," said Peter Grandich, editor of the Grandich Letter, but the "surprise continues to be its upside potential."

"Very strong physical buying worldwide combined with continuing mining supply shortfalls is but two of numerous bullish factors going for gold at the moment," he said.

---(see url for full news, 24-hr newswire, market quotes)---

968 (8/15/05; 14:28:39MT - usagold.com msg#: 134994)
@ Cobra(too)
"Displacement of the system has come a long way and will only accelerate from here on out. The POG also will again be following the fundamental demand/supply equation"

Again ???? Can you tell exactly WHEN the POG did follow the demand/supply equation in the past ?

A demand/supply equation as gold, a commodity, or as a wealth reserve asset ??? If gold is nothing more then a commodity subject to the supply/demand equation, why not buying silver ?

Looking forward to your answer !

Topaz (8/15/05; 14:20:55MT - usagold.com msg#: 134993)
relatively speaking,
http://www.futuresource.com/charts/charts.jsp?s=GC&o=100/DX&a=M&z=610x300&d=medium&b=LINE&st=
our Gold-v-alt currency spread is approaching '99 proportions. Over the last 5 Yr's, we've endured many a mini-retreat as Gold retraces to lend support to the Basket, I think however we may now be ready to give them all up.
As the pundits sit back content in the knowledge that this current up-tick/retrace was nothing more than SA strike inspired, watch closely as PoG nails them to the alt side of the Crucifix with mouths agape.

What the!! ...indeed.

TownCrier (8/15/05; 14:17:03MT - usagold.com msg#: 134992)
China's economic planning body hits out at central bank
http://www.thedailystar.net/2005/08/16/d50816051155.htm
AFP, Beijing -- China's key economic planning body, the National Development and Reform Commission (NDRC), Monday lashed out at the reform policies of the central bank in a highly unusual display of bureaucratic infighting.

^---(see url for short article)---^

Sometimes in a body the left hand doesn't always know exactly what the right hand is doing...

.....?.........?......

R.

968 (8/15/05; 14:16:25MT - usagold.com msg#: 134991)
@ Towncrier # 134987
Your fine thoughts on both, please !

Thanks in advance.

TownCrier (8/15/05; 14:08:19MT - usagold.com msg#: 134990)
Bankruptcy possible for Vista Gold
http://denver.bizjournals.com/denver/stories/2005/08/15/daily2.html
The Denver Business Journal - Monday

Vista Gold Corp. is teetering on the edge of bankruptcy, without enough capital to cover the roughly $3.2 million in known obligations coming due in the next year.

...Vista studies and buys prospective gold mines that have defined gold resources. The company does additional exploration and technical studies to raise the value of the projects for eventual development.

The company lost about $1.5 million during the second quarter, compared to a $1.4 million loss for the second quarter 2004.

For the first six months of 2005, Vista reported a loss of $2.4 million...

The company blamed the losses on several factors, including slightly decreased exploration, property evaluation and holding costs, and increased administration and investor relation costs of about $100,000 for a mass mailing marketing campaign during the second quarter.

^-----(from url)-----^

Simply a reminder that gold exploration and mining companies can suffer all of the same woes as any other stock investment, even in a gold bull market.

True diversification, therefore, requires a portion of your holdings be in gold METAL rather than gold stocks -- because in the long history of the world, companies have come and gone, but nobody has ever seen a box of gold coins declare bankruptcy, nor has its owner gone begging.

Invest in what you will, but be sure to devote a prudent portion toward putting a solid foundation under your portfolio. Call USAGOLD-Centennial for consultation on a diversification strategy that's right for you.

1-800-869-5115

R.

TownCrier (8/15/05; 13:42:53MT - usagold.com msg#: 134989)
Fed boosts money supply -- adds 'permanent' reserves through outright Treasury purchases
In open market operations the Trading Desk for the Federal Reserve today injected 'permanent' reserves of fresh cash into the nation's commercial banking system through the outright puchase of Treasury coupons for the Fed's own account.

The size of the operation totalled $1.39 billion, tarketing maturities of Oct 2006 to Nov 2007. As this new cash is so called "high powered" cash reserves, the banking system can use it to further expand the money supply to the full practical limitations allowed by our banking system's fractional reserve structure.

Polishing up the liquidity pile, the Fed's trading desk also today injected $9.5 billion in temp funds via overnight repos.

R.

USAGOLD - Centennial Precious Metals, Inc. (8/15/05; 13:04:37MT - usagold.com msg#: 134988)
New to gold? Try our Gold Ownership 'Starter Kit'
http://www.usagold.com/gold/special/starter.html
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TownCrier (8/15/05; 12:34:03MT - usagold.com msg#: 134987)
968, RE: msg#: 134970
My thoughts on WHICH subject -- on the gold pricing mechanism, or on Ferdi having knitted a perpetual purgatory to which he would have us all go?

R.

Goldilox (8/15/05; 10:30:05MT - usagold.com msg#: 134986)
UK theocracy statement
@ Caradoc,

That's an interesting statement coming from a government where the "apolitical" "Royal Family" still owns one of the largest asset holdings in the world.

As US demographics are rapidly growing in Hispanic numbers, and Euro block countries exhibit rapidly rising Muslim populations, I wonder how that statement will look in 10 or 20 years. . . especially if Parliament starts seating some Islamic MPs from the immigant neighborhoods. Will they be able to successfuly gerrymander their election districts to counter-effect this?

The US is seeing second and third generations of Latino immigrants actively engaged on the political scene, and it only lends credence to the suspicion that Britain and the Euro block will experience the same.



CoBra(too) (8/15/05; 10:27:53MT - usagold.com msg#: 134985)
Belgian
Instead of an answer - I really loved your caged golden bird
analogy; It may be close to the canary in the coal mine - if the mine becomes dangerous, just kill the canary.

I'm sure with you when you restate gold=wealth and so would Ferdi Lips be, notwithstanding that he founded the Rotshild Bank of Zurich in 1971 and a few years later the Lips Bank, a gold bank purely on its own gold/wealth standard.

Been there,have seen it all and more. And yes I admit I'm also closely connected to some junior gold/silver producers, developers and even explorers.

just one more remark re oil pricing - Here the market has taken over in large parts, even if some "powers" are still trying to interfere. The demand situation has changed dramatically, just as it did with almost any other hard asset, including the pm's. While the pm's seem still lagging, it just may be because there is no other solution available in the jungle out there to ameliorate a total destruction of today's system; And not only the prevailing monetary system. Well, as it looks today all markets are manipulated - the currency-, sm-, bond and even derivative markets. In the end it is the last stand of defense for the system's apologists.

A/FOA have seen this long ago and so have all of us on this great site of our gracious host MK, who has so much to contribute. Meanwhile the debt pyramid, and one one can't get by to mention the spiralling of the US debt on all levels has taken on utter irredeemable proportions - it may become to speculate if the US $ reserve Currency systeme will become totally obsolete; It is only a question of when.
The Unocal takeover bid from the Chinese may become a catalyst of grabbing some more real and hard assets in the US - regardless of price - as long as the US $ still buys anything of "relative" value;

Displacement of the system has come a long way and will only accelerate from here on out. The POG also will again be following the fundamental demand/supply equation - when the miners again will watch the canary signalling danger.

Best cb2

PS: Ned - Sure I know frr quite intimately.


Caradoc (8/15/05; 10:16:13MT - usagold.com msg#: 134984)
2006, not 2996.
Sorry 'bout that.

Caradoc (8/15/05; 10:14:07MT - usagold.com msg#: 134983)
UK says Islamic law OK for Iraq
http://www.thebusinessonline.com/Stories.aspx?StoryID=6E9B9FD2-3036-4A24-B915-E0FD2768995F&SectionID=F3B76EF0-7991-4389-B72E-D07EB5AA1CEE
Two snips:
BRITAIN's new ambassador to Baghdad has no objection to Iraq becoming a formal Islamic republic if that is what its policymakers choose as they prepare to unveil the new constitution this week.
..."We don't have a problem with theocracy in Iran. Having a democratic election in which you have a theocracy is OK, as long as that can be changed and is not a once-and-for-all election," he said.
End of snips

Wonder whether the ambassador has any examples of Islamic theocracies (governments implementing Sharia law) ever changing to something different as the result of an election rather than as a result of violence. I don't know of any.

Caradoc

PS: maybe "Iran" in second snip was typo for "Iraq"?

Goldilox (8/15/05; 10:14:07MT - usagold.com msg#: 134982)
Iran offices
@ Caradoc,

McCanney reported this week that the London times was questioning a Halliburton office in Downton Tehran. Does this violate the "dealing with terrorist nations" act, or perhaps suggest that US interests also have proprietary reasons to cool down the political rhetoric?

Caradoc (8/15/05; 10:08:06MT - usagold.com msg#: 134981)
Iran to open up to carmakers
http://www.thebusinessonline.com/Stories.aspx?StoryID=65298152-8595-4632-B3F8-79DD9D739AC8&SectionID=F3B76EF0-7991-4389-B72E-D07EB5AA1CEE
Snip:
FRENCH and Korean car manufacturers including Citroen, Peugeot, and Daewoo are set to benefit most from the burgeoning Iranian car market as Tehran moves to lower import taxes tax on whole cars.

The carmakers are well placed because they have joint ventures in the country as do Renault, Nissan and Mercedes. Most ventures take the form of licensing and production agreements though Korea is currently investing in a state of the art plant.
End of snip

Sounds like several economic entities won't want things disturbed in Iran (which plans to open Tehran oil bourse priced in Euros in March of 2996). This lessening of demand for dollars becoming petrodollars won't go down well in DC.

Caradoc

Goldilox (8/15/05; 09:12:48MT - usagold.com msg#: 134980)
Russia Politely Supports Iran's Nuclear Intentions
http://www.jsmineset.com
snip:

It was reported yesterday that Russia made an official statement that it would like to see tensions eased over Iran's nuclear development program. Russia, as well as China, have large oil investments in Iran and would likely come to its defense in a showdown with the US with respect to advancing the country's nuclear program.

Iran is not Iraq and military action against Iran will put in harms way large Russian and Chinese investments. That could be a serious risk in today's world. This will also empower the certifiable nut bar in North Korea to belligerently pursue his profitable program of selling nuclear technology to the highest bidder.

-Goldilox

Not to mention the certifiable nut job in the Pentagon who "looked the other way" while his Swiss company sold North Korea the nuclear technology in the first place. These guys are "all about security" until it interferes with their bottom line!

But of course, this same nut job was buddying up to Saddam while that great hero Ollie North was parlaying Nicaraguan cocaine into arms for Iran from the White House basement flea-market. North's lies about this garage sale to Congress won him an indictment and subsequent "pardon" from Bush the Elder (and of course, his own TV show on FOX).

If Iran's oil bourse sees the light of day, the new "reformed" CIA will be ordered to spin some "Yellow Cake" memos to bolster oil profits in the Nymex. This particular yellow cake will in no way resemble "angel food", and will lead to further interruption in the world oil supply.

Once this comes to pass, Exxon's $8B record quarterly profit will resemble "lunch money".

When commodities, a finite resource, meet FIAT, an infinite resource, paper prices rise "to da Moon", at least until some "miracle" changes the perception.

mikal (8/15/05; 09:05:43MT - usagold.com msg#: 134979)
Hapless dollar fights back
http://news.morningstar.com/news/DJ/M08/D15/200508151030DOWJONESDJONLINE000307.html
Morningstar - Dow Jones & Company, Inc.: CURRENCIES: Dollar Lifted By Investment Data - 8/15/05
Source: http://www.usagold.com/DailyQuotes.html

Goldilox (8/15/05; 08:40:08MT - usagold.com msg#: 134978)
Calcutta plans ban on rickshaws
snip:

"Calcutta's famous hand-pulled rickshaws will soon be banned, according to the chief minister of the Indian state of West Bengal.

The rickshaws had long been considered "inhuman" and did not exist anywhere else, Buddhadev Bhattacharya said.

The rickshaw, immortalised as a living symbol of Calcutta in films such as City of Joy, will be phased out in four to five months.

The hand-pulled rickshaw came from China in the 19th century.

Mr Bhattacharya said: "We have taken a policy decision to take the hand-drawn rickshaw off the roads of Calcutta on humanitarian grounds."

-Goldilox

More bone piles, even in India. My guess is that they will push for gasolin-driven alternatives, exascerbating the unemployment issue with a massive uptrend in air pollution.

Of course, there will be a large influx of 24-Hour Fitness centers and the accompanying fees required to keep them healthy!

We can rest assured that stupid government is not limited to the west.

mikal (8/15/05; 06:35:34MT - usagold.com msg#: 134977)
Dollar rises ahead of inflows data at 9AM
http://quote.bloomberg.com/apps/news?pid=10000006&sid=aOORQzYFXqkU&refer=home
Dollar Rises on Speculation Demand for U.S. Assets Increasing - August 15, 2005

Ned (8/15/05; 05:26:21MT - usagold.com msg#: 134976)
@ TC
Yes indeed Turley a la Argentina experienced dwindling currency. I wonder though about the dollar. Was it FOA or amother that said (paraphrasing), "...in the end both the dollar and gold will rise together". I guess they saw a pinch of deflation too!

Up until a year ago I was firmly in the inflation camp, bought the McMansion, as Prector calls a huge house w/ huge mortgage, open up as many lines of credit as possible and said "let 'er rip". Co-incidentally this also was in parallel to the FED beginning to raise rates to 'cool' inflation.

Now I see a different view, what if oil does crash the world economy? What if oil, as we first assumed would, does not cause inflation to 'percolate' through the economy? What if it stops the economy dead in its tracks? What if the housing giddyness does stop? What if the consumer does stop spending frivalously?

This inflation/deflation debate is a waste of time, it could go either way (see/hear Puplava).....for that matter it may not happen at all! Maybe Mr. Greenspan has been sold short, maybe he is the MASTER ! Maybe the US FED can keep this going for another decade.

However, given the fullness of time gold will win. As Prector says regarding the fiat money system, "...in the end, gold will win". My 3 Horsemen will see to that:

Oil.................2006-2010
Demographics........2008-2012
Fiat burns ........2006-2012

Add to the mix "Resource Wars", "Blood & Oil" (Michael Klare) and you get NUKES........2010-2020.(I don't believe Klare actually said NUKES, I'm thinking maybe NUKES)

Guessing on the time frames of course. Trouble is the 'default' position of the human race over time is to muck things up, go to war, shed blood, make things worse.

I leave you with a snip of an already famous Paul Volcker quote, I believe from the spring of 2005:

"Circumstances seem to me as dangerous and intractable as any I can remember. ... What really concerns me is that there seems to be so little willingness or capacity to do anything about it"

Gold.........get you some.
Nuke shelter.....build you one.


Topaz (8/15/05; 02:50:46MT - usagold.com msg#: 134975)
...however,
to imply an "Official" move to FreeGold, is imo selling the FreeMarket short somewhat.
I would think all these micro-moves we are or have been witness to these last 6odd years (WAG's etc) are more a reaction to Mr Markets tacit insistence on FreeGold than any contrived future declaration.

Topaz (8/15/05; 02:26:16MT - usagold.com msg#: 134974)
FreeGold.

FWIW, My interpretation of what FreeGold represents and is destined to achieve, is that status of an Asset to Hold that is OUTSIDE the System.
Currently through both Libor/GoFo and Futures Markets, PoG is effectively Paperised. As such she's very much IN the System.
This inhibits it's ability to act as a Systemic Counterweight.
Given ALL the usual reasons (longevity, scarcity etc.) gold should be associated with NO interest and it's Price determined by Spot demand/supply.
We will have as an option, unrestricted access to - Gold Bullion - untethered - no interest - No lend or borrow, to FREELY buy and sell as our circumstances AND our assessment of relevant Fiat regimes dictate ...of course this would negate the NEED for a WRC...they would all then be vying to retain as much value against Gold rather than as is nowadays, trying to LOSE value against the Buck.

It's far too involved for me to keep track of nuances that head us in that direction but imo, the concept makes too much sense not to.

Belgian (8/15/05; 02:17:45MT - usagold.com msg#: 134973)
Knallgold : reality check
The (helping) reality is that euro-policies proceed as architected, highly or lowly publicly profiled.
How many "slaps" has the EU-unification process been absorbing and overcoming in the past decades !? Common Knally...the recent "hit/slap" changed nothing on the decades old "idea" and Very little on the implementations of it.

Rethink the general (public) opinion on the ECB/BIS-complex's "actions" !!! WHAT and WHY exactly are they strategically fabricating !? Is this really as transparent as it is publicly presented ? Ohhhhh Noooooo Sir.
Always bear in mind that the $-numeraire under the $-IMS has no legal tender laws outside the US. Transplant this to the €-numeraire !

From 1971 to 1980, the global gold-accumulators were in the (unorganized-!!!) process of freely pricing the metal. This (rather spontanious-natural) action was brutally aborted. Don't bid for goldmetal...or...we manage you can't get a gram (price to da moon)! THIS STILL WORKS TODAY, Sir.

What is changing ...is the gold-camp formations and their respective weight on the $-IMS. Another goldpricing-regime also means a different relationship between the heavyweights in the planet's boxing ring. Very unopportune for the game to finalise it with any kind of KO uppercut (breaking the goldprice management). We simply evolve round after round (think Asia/oil factors).
We continiously check these realities, no.

Champs and friends, come and go...but all wish to stay in the ring.

What exactly stopped/altered/broke the gold-regimes in 1913, 1971 !? The correct answer is that it is not a very particular event that changed the regime overnight...but a process that was evolving (riping) and suddenly was decided to "happen" (step over the shadow). So, why do we ask ourselves the same question, today : what is going to break the existing goldpricing-regime !? There is no fixed date for having the new free gold pricing. As there were no fixed dates for US citizens' gold confiscation or closing of the gold window...or WAG I...or any other official goldmetal exchanges (redistribution transfers).

Think about the recent "process" of the evolving yuan regime as an example as to how the gold-pricing is evolving.

Was there a predictable timespan for the fall of the Berlin wall (re-united Deutshland)!? But we increasingly grow in our convictions that one day this ugly thing was going to become history. What happened to the iron curtain ...etc...Why then is it so difficult to accept/see that the same (kind of process) is happening in the gold-pricing (recent regime) !?

It is as if all goldbugs collectively don't wish "it" to happen ? Strange, no. No, it is not strange...



Caradoc (8/15/05; 01:55:19MT - usagold.com msg#: 134972)
Gold "Bubble" non-contest
Interesting responses!

I had planned to list responses in decreasing order based on the number of Aug 2005 dollars necessary to be perceived as a "bubble" by May of 2006. Instead, here's a summary of what you all posted:

Belgian in effect, no number high enough to be a bubble
Clink! $100,000 or equivalent (but around 2016, not 2006)
24karat $1,800
Caradoc $1,642
Smeagol $1,500
jenika $1000 (but Australian dollars)

Those assembled at this table are an independent-minded crew, so I don't envy Gandalf his duty as master of contest. We all owe him a vote of thanks because that duty must be like trying to herd a bunch of cats. If this had been a contest, there would have been a correct answer to try for and fairness would demand eliminating some responses. Instead, each of you gets full credit for having accurately addressed your own perception of a gold bubble.

Further, I find myself agreeing with the logic each of you uses. Starting at the top, if I hear that in the faroff kingdom of Boomba you can buy gold at 1000 baboombas per ounce, I know exactly what a baboomba is worth and have learned nothing about gold. And if I hear later that the price has suddenly risen to 3000 or 4000 baboombas (high enough and fast enough to satisfy 24K's preliminary definition of a bubble), I know that something has happened to the baboomba -- something Smeagol might call a "baboomba crater" -- and still have learned nothing about gold.

That said, a bubble is by definition something that bursts. If you join me, 24K, and to some extent Smeagol in seeing potential advantage in at least temporarily reducing gold holdings at or near the peak of the gold bubble/ dollar crater, you still have to recognize the signs that we're in a bubble and the signs that it's nearing its peak.

Picking up on 24K's "rapid run-up" and "widespread demand," the clues are likely to be in terms of human behavior rather than in reaching/ having reached a specific number. Looking at a previous bubble, the US stock market, note that in 1997 "DOW 10,000 by the year 2000" sounded crazy but was more than 10% below the mark. Equally, some respected stock market gurus were advising caution as early as 1998. Any bubble -- including the current housing bubble -- is likely to reach heights no one would expect and last longer than most would think before bursting.

My hunch is that when cab drivers and convenience store clerks want to talk about gold, you'll know we've entered a bubble. As for when to exit to avoid the bursting of the bubble, it'll be at most a matter of weeks after the gold boom takes over the covers of national publications. Closing the focus in to a matter of days, note that when television's 60 Minutes did a segment on people standing in line to swap Grandma's golden candlestick holders for dollars, the bubble had burst before the following weekend.

True, those wishing to relay a certain number of ounces of real wealth to their descendants need not concern themselves with gold pricing whether in dollars or baboombas. And attempting to play the bubble will admittedly be a gamble. But with the right clues, switching at least temporarily to another form of wealth just might allow you to relay an even greater number of ounces to those descendants.

Regards to all,

Caradoc












Belgian (8/15/05; 01:12:48MT - usagold.com msg#: 134971)
Cobra2
No ridiculing, no hidden meanings at all...nothing personal, etc, etc. Gold dialoque !

Any goldprice is the result of a "gold-pricing" that happens in a "structure". The goldprice(s) are NOT a random effect.
Think, for instance, WHY the goldprice of bullion, encounters increasing pressure to abandon VAT on it. What exactly is the purpose of this changing trend ? VAT or not has to do with a gold-pricing policy that happens under a structure (a system). It is the difference between who wants the goldprice to remain controlled under the present gold-pricing regime and who wishes the gold-price to evolve under another pricing regime.

Think about the following : Up until now w've valued the bulk of publicly quoted enterprises (stocks) at an equilibrum price of 15 times (real and not pro forma)earnings. As a matter of fact, the goldprice was related to the oilprice...also with that same (average) factor of 15. POG = 15 x POO.
This (price-pricing) relationship has "changed" !!! How come Cobra ? Temporary accident, anomaly...or something much more fundamental behind it ? A PURPOSE...a strategy !?

When a golden bird has been living for decades in a cage (goldprice container) and suddenly the cage is opened (freegold)...does this bird realizes instantly that it is free and takes off skyhigh ? No, Sir...the bird's new freedom is also one with a particular structure...limitations (cage versus athmosphere).

It is the difference between a goldprice as a result of the goldpricing under the gold=money regime and the future goldprices under the goldpricing under the gold=wealth regime. Gold dialoque is needed to agree (to see and understand) on the difference between "money" and "wealth" !!! On this we totally fail on this unique forum and all gold-authorities leave goldbugs and philes in the dark, simply by mixing the two (money and wealth) conveniently (confusingly) with each other.

Money (all types of confetti) are taxed...Wealth isn't.

One's health is one's wealth...but this particular wealth is not transferable or eternal. Gold-wealth...as the metal in possession, is ! A goldmine is NOT the "owner" of the metal !!! The papergold speculators cannot be the owners of the goldmetal-wealth that the contracts are supposed to represent. This is the old (dying) goldpricing regime...the gold=money thing. Lips is a banker with a goldmines' relationship...he's a confetti merchant and speaks for his cartel. The gold=wealth advocates are uniting and striving for another gold-pricing-regime.

Money, fiat, confetti...knows bubbles and busts. Wealth doesn't ! Wealth (the goldmetal) is universally transferable intact.

There is no such thing as a wealth-option (derivative). That's complete nonsense ! But again, here we have to determine exactly what "property" is and isn't.

Cobra : You also see how the oilprice is evolving. Do you suspect that something is changing in the oil-pricing ...the structure/system under wich the oilprices are assembled ?
And surprise, surprise...many theoretical thinkers are even very busy with architecting the structure/system/regime under wich the present house-pricing is happening...





968 (8/15/05; 00:39:11MT - usagold.com msg#: 134970)
@ Towncrier
Randy, can you please share your insights on this subject with us, please ?

Thanks in advance.

Knallgold (8/15/05; 00:28:38MT - usagold.com msg#: 134969)
Belgian,the world has changed again
"The one who keeps gold at a fixed price...or the one who is marking its goldreserves at market"

But in my book the ECB is still a fixer of the Goldprice,recently joined by the allegedly Goldfriendly BIS.And we are again,oh,how many years later?

"Who or what exactly is going to break that particular goldprice manipulation you mention"

See above,maybe it IS (only) us,the asians,GATA who are breaking/exposing the manipulation just by the shear fact of overwhelmingly buying physical?Okay,the Goldderivatives outstanding have been dramatically reduced (but then,Goldpanda said be careful on gov. statistics...),maybe this is just a very defensive move because it really posed a systemic risk-but why then should the FED be in Another camp?

Face it,the big-gov.-unified EU idea has taken an irreparable hit-and it was fully their own fault, ignorant,arrogant and incompetent as they have been-just deserved a slap!It opened a door to a better and brighter and more pragmatic way,it only has to be walked now.Gold as UNMANIPULATED wealth asset is in my view a central part of it.Its also in the interest of those holding Gold,including the USA!So,Europe and America are bound to work together on it-some will have to step over their shadow though but its imperative as the whole western world is challenged!

Sometimes a reality check helps!



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