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ARCHIVED DISCUSSION FROM 7/16/2001 All times are U.S. Mountain Time (Yesterday's Discussion.) Black Blade (07/16/01; 23:47:47MT - usagold.com msg#: 58198) Suffocation, War or Coal http://www.dailyreckoning.com/home.cfm?loc=/body_headline.cfm&qs=id=1243 Snippit:"The world consumes about one billion barrels of non-OPEC oil every 23 days. Just to replace production, we would have to add one billion barrels of recoverable new reserves every 23 days. That cannot be done." Turning to natural gas, Groppe states, "To maintain total North American gas production, we'd have to bring on-stream every year, total production roughly equivalent to the [total] production that has been developed on the Gulf of Mexico shelf in the last 45 years. This can't be done!"Black Blade: DITTO! We have doubled the number of drill rigs over the last 2 years and still can't increase production. Yet we continue to build NG-fired power plants. Anyone still wonder why George Dubya is concerned about energy? He doesn't want the economic crash to come on his watch - I think it's too late for that. Good commentary.GOLD - Cheap Insurance - Proven Protection! Black Blade (07/16/01; 23:09:09MT - usagold.com msg#: 58197) Asia Tanking! http://quote.yahoo.com/m2?u "Ladies and Gentlemen, in the event of an emergency landing, remove eye glasses, and tuck your head between your knees. The seat cushions may be used as floatation devices." Asia coming in for a crash landing tonight. S. America should fair no better tomorrow. Also check out the stock market indices for today's trading action south of the US border. Very ugly. The Invisible Hand (07/16/01; 22:47:57MT - usagold.com msg#: 58196) The significance of Genoa as meeting place for next week-end‘s G10 meeting Gary North's REALITY CHECK Issue 67 July 16, 2001 NOT AS BAD AS EXPECTED...…0last week's meeting of the G-7's senior economics ministers. He said that the U.S. economy will grow by 3%, up from this year's 1.2%, beginning early next year. Other nations' finance ministers were also upbeat. But not Gordon Brown of the United Kingdom. (Their main meeting will be on July 20-22. Genoa was the scene in 1922 of the dismantling of the pre-War international gold standard, which had kept prices stable for a century. After that, a phony version, called the gold-exchange standard, was adopted, where central banks kept interest-bearing debt of England, and later the United States, instead of actual gold.)====I know that the first and second sentences contain a syntactical error, but that's Gary's writing.Have CoBra(Too) and Buena Fe perhaps some comments or rather additional information as to whether 1922 will be reversed?@ Belgian I should have known better than to disclose my identity in The Invisible Hand (09/13/00; 21:14:46MT - usagold.com msg#: 36624)Ja, ik zit inderdaad in d’oemstreken van HK. Black Blade (07/16/01; 22:28:13MT - usagold.com msg#: 58195) Will Argentina spill over? http://www.nationalpost.com/financialpost/story.html?f=/stories/20010716/619662.html Confidence spreads in credit market key factor to watchSnippit:Reflecting the huge public debt is the annual budget deficit, which is currently running at about US$8.1-billion. The International Monetary Fund set a deficit target of US$6.5-billion for this year as a condition for Argentina's access to a US$40-billion financial aid package. The loan is in jeopardy and the country's financial solvency has now come under attack over fears that Argentina may be unable to meet its financial obligations. As the crisis escalated last week, Argentina's short-term interest rates skyrocketed, with yields on 90-day T-bills and one-year bonds at the latest government bond auction coming in at 14% to 16%, while day rates spiked to as high as 55% annualized levels in overnight trading. In reaction to the crisis, President Fernando de la Rua announced major government spending cuts, such as reducing government salaries and pensions, designed to trim a US$50-billion annual spending budget.Economic crises occur with some regularity in Latin America and generally have spillover effects. The 1994-1995 Tequila Crisis in Mexico when the peso came under severe attack affected prices and returns in the entire region. Thus far, the Argentina effect has been relatively contained. Argentine stocks have lost more than 24% of their value in July while the Latin America region fell by just under 4%. Virtually every world region lost between 3% and 5%, so I would consider the losses in the Latin America market to be more reflective of world equity markets at this time than the pull of Argentina.Black Blade: Spill over? I say yes. We "live in interesting times." Black Blade (07/16/01; 22:20:06MT - usagold.com msg#: 58194) Argentina Crisis Puts Trade Bloc at Risk http://www.latimes.com/business/la-000058178jul16.story?coll=la%2Dheadlines%2Dbusiness Argentina Crisis Puts Trade Bloc at RiskSnippit:BUENOS AIRES -- As Argentina wrestles with its latest economic woes, one unintended victim of the crisis could be trade relations and a possible death blow to Mercosur, the trading partnership that comprises Argentina, Brazil, Paraguay and Uruguay. Born amid great hopes, Mercosur was supposed to provide a regional market for home-grown commodities and services. Instead, critics say, it has institutionalized the instability and inefficiency of its members.Black Blade: OOPS! The end of the South American NAFTA? United we fall - divided we fall. There has been a lot of wealth transfer between Brazil and Argentina over the years as each economy has taken its lumps. Now both are crashing and there is no where to run. This could get ugly - perhaps as ugly as the Asian Contagion and Russian Bond Default combined. It could very well spill over to the rest of SA and Central America. And like a row of falling dominoes it could be a final nail in Wall Streets coffin. Very "Interesting." goldquest (07/16/01; 22:08:55MT - usagold.com msg#: 58193) test test Black Blade (07/16/01; 22:06:55MT - usagold.com msg#: 58192) World running out of cheap oil that fuels economies http://www.chron.com/cs/CDA/story.hts/business/967449 Snippit:In fact, 1998 may have been the last hurrah of cheap oil. It may also have marked the end of a global boom and the beginning of a struggle with rising energy costs that will never end. Yes, you read that right. Never end. This may not be a momentary cycle or political phase. Rising energy costs may be a major secular trend. It will change how we live.It should be noted that the authors are not members of the gloom-and-doom school. They were careful to acknowledge alternative sources of oil that are, as yet, undeveloped. "The world is not running out of oil -- at least not yet," they declared. "What our society does face, and soon, is the end of the abundant and cheap oil on which all industrial nations depend." One implication: The energy jolts of the last year could signal that we are about to experience the economic boom of the '80s and '90s in reverse.Black Blade: A page out of "The Rise and Fall of Hydrocarbon Man." The book mentioned (Green Monday) sounds like it could be interesting. Wonder if the drop in oil to $10.00/bbl a couple of years ago was part of a "Whip-Saw" scenario by Arab OPEC members to make a quick stock profit? You just never know. It would have been quite a coup. And boom in reverse? - Gold as a wealth preservation vehicle? Of course, it is cheap at these prices. Canuck (07/16/01; 21:23:16MT - usagold.com msg#: 58191) @ HBM, Belgian, nickle62, Megatron, Netking Really enjoyed the 'banter' back and forth today......great stuff.You read and read until your eyeballs glaze over trying to understand what the hell is going on and suddenly a 'roll' of posts come out making some sense. Good job men.Over the week-end I spotted the Paul van Eeden story and BOOM! it suddenly makes sense again why I am 'accumulating'.Half the lies you hear aren't true so it's good to be reminded of something that makes sense.Waiting for 'Alan Greenspan: Final Act' or Bullion Bank: The Last Bet' or 'Hedged Miner: Over-The -Edge' coming to a currency devaluation near you.The part that I am getting giddy over is I realize that I have the time (to wait) and they don't. (smile)Have a golden week.Canuck. Tree in the Forest (07/16/01; 21:09:36MT - usagold.com msg#: 58190) How the Bilderbergers are pushing the Euro http://www.tlio.demon.co.uk/reports.htm#most This article is from 1998 but is still apropos today. It indicates why Thatcher got the boot; she was too independent and didn't commit to the Euro.The world's most exclusive club wants supremacy in the judicial and economic fields20May98 - The SpotlightBy James P. Tucker Jr. - TURNBERRY, ScotlandAlthough moderately distracted by the new nuclear arms race between India and Pakistan, Bilderberg concentrated on its major goals on the road to world government:Establishing a global court that would be superior to the U.S. Supreme Court and to those of all nations; Pressing British Prime Minister Tony Blair to have the political courage to drag his country into the European common currency, the euro; Pressuring the U.S. Congress into approving $18 billion to make interest payments to international banks which made bad loans to uncreditworthy countries on the assurance that taxpayers would make them good.The British prime minister was summoned to shuttle back and forth from the summit of the eight industrialized countries held 450 miles away in Birmingham, England, at the same time by design.Blair was hardly treated as a head of state. He was lectured severely for failing to bring Britain into the common currency, which is to be phased in beginning January 1. Blair assured Bilderberg that Britain would join, but he had to resolve "political problems" because "there is a surge of nationalism at home.""You're a Maggie Thatcher in long pants," a German told Blair. This was a crude reminder that Lady Thatcher had been dumped as head of state by her own Conservative Party on Bilderberg orders and replaced with trapeze artist John Major, for the precise same reason (SPOTLIGHT, May 29, 1989).After being deposed, Lady Thatcher told The SPOTLIGHT she considered being denounced by Bilderberg a "tribute" because neither Britain nor any country should surrender sovereignty."Helmut Kohl (German head of state) never flinched" in pressing his country to join the common currency, the German told Blair. "He may lose this election because of this. You know Germany has a problem with nationalism. But Helmut stood firm."Blair turned and walked away. There was much discussion and optimism among Bilderberg participants about a June meeting of the UN in Rome, to draft a treaty establishing a permanent International Criminal Court. Unlike the present World Court, the ICC is to have enforcement power and could impose its decisions universally."Will America's nationalists (an expletive in Bilderberg dialect) give us trouble about the court treaty?" asked one.‘I think not," replied an American believed to be but not positively identified as Casimer Yost, director of the Institute for the Study of Diplomacy, School of Foreign Service, at Georgetown University in Washington.NOD FROM SENATEThe American pointed out that in 1994, the U.S. Senate voted 55-45 to encourage establishment of the ICC under the UN. The Senate did so, he said, with the full knowledge that the global court, with judges from (Red) China or other rogue nations, may pass judgment on the United States and individual citizens."There was some objections by the American public, but not much," the American said. "Most of them know nothing about it and probably won't." "Unless one of them is sent to jail by the ICC," interjected another. "Yeah, then they will notice," the American said.The latter exchange was jocular and scornful.On expanding NATO, Bilderberg participants were impatient."The shortest path to permanent peace is to bring everybody in including Russia as fast as practical," said one speaker whose comment met with general approval.A question was raised about costs."Costs, you ask?" the speaker responded. "How much did two world wars, Korea, Vietnam and the Gulf War cost Americans? Peace is far less expensive."To ensure "permanent peace throughout the world requires a strong enforcement mechanism, which means keeping the expanding NATO intact but under UN direction, for which there is a precedent to which none except rabid nationalists objected," the speaker said.The "precedent" referred to was UN forces in Bosnia, where American soldiers were issued the UN uniform and served under a foreign commander who reported directly to the Security Council, with the U.S. president and Congress having no role at all.CONGRESS BALKSBilderberg participants were clearly stating that the UN is to emerge into a world government with its own army patrolling the globe enforcing its will. Bilderberg luminaries expressed outrage that Congress did not approve the $18 billion for the International Monetary Fund to bail out the big banks a year ago."How could you let your Congress get so out of control?" asked a Frenchman of an American during informal glass-tinkling. "It was never a problem before.""Our Congress has a problem we call voters," came the answer. "That's because we have less direct communication," the Frenchman said."Leaders of your Congress no longer accept our invitations to attend Bilderberg." "Again, the problem is voters," the American explained. "For years and years, we enjoyed almost total privacy. Now, right-wing extremists stir the voters up and congressmen have too many questions asked of them."For decades, such congressional leaders as former House Speaker Tom Foley (D- Wash.), former Senate Banking Chairman Lloyd Bentsen (D-Texas) and others attended Bilderberg. Bentsen continued as President Clinton's Treasury secretary, but was not listed among this year's participants.For the past several years, the only legislators to attend were Sen. Sam Nunn (D-Ga.) and a House member but only after each had announced his retirement."We need them back, as the IMF problem shows," the Frenchman said. "But how?" asked the American. "Congressmen now consider attending Bilderberg; to be political suicide."Bilderberg regulars were all accounted for, including David Rockefeller, Henry Kissinger and Evelyn de Rothschild, chairman of N.M. Rothschild & Sons of Britain and Europe.President Clinton, himself a Bilderberg member, sent his usual assortment of administration officials: Marc Grossman, assistant secretary of state; Vernon Jordan Jr., a top unpaid advisor who will report Bilderberg demands directly to the president; Lawrence Summers, deputy secretary of Treasury; and Christine Todd Whitman (R), governor of New Jersey.This is Mrs. Whitman's first Bilderberg meeting, which means they have plans for her. After Clinton's first Bilderberg meeting, in Baden-Baden, Germany in 1991, he became president.Other old-time luminaries present included Chairman Peter Carrington, former secretary-general of NATO; Paul Allaire, chairman of Xerox Corp. and Conrad Black, chairman of the Telegraph of London and owner of a vast newspaper chain, among other global interests. Black Blade (07/16/01; 20:59:26MT - usagold.com msg#: 58189) RE: Old Yeller - Very Good Article - Recommended Reading! http://www2.marketwatch.com/news/story.asp?guid={6EF7EEB8-A3C4-4C03-A3D2-9B92222A0850}&symb=APC&sid=582 Snippit:"I don't know if we have the national will to solve it," said Bob Gillon, vice president and analyst at John S. Herold, an energy research firm. "Every time that it appears the immediate crisis has been solved, there's a tendency for the issue to go very far back in the public's consciousness."Black Blade: This snippit from your posted link really nails it. The problem is complacency when there is no visible problem. Today I heard on the local radio station one of the extremists environmentalists saying that now there's no energy crisis so the drilling on public lands must end (this is in the Coal Bed Methane in Wyoming). People tend to focus on oil and gasoline, however, electricity and natural gas are the real hidden land mines. Snippit:Consumers and politicians point to a multitude of new power generation facilities going into development in the next two or three years that appear sufficient to meet the growing energy needs of the world's largest economy. Yet with gas supply unlikely to expand quickly enough to fuel those plants, Americans may be facing years -- not just few quarters -- of occasional blackouts. Black Blade: Exactly. "Red" Davis - governor of Kalifornia, has gleefully extolled the virtues of being "Green" and now the big bad energy companies are on the run as he single handedly put new power plants into service. Of course they require fuel - oops! And now several out-of-state natural gas and energy providers have sworn off doing business in the state. There will be real problems if a heat wave kicks up this summer. Look what happened when Las Vegas sold power to Kalifornia only to have their own blackouts because they over sold - again - oops! The economy is vulnerable. The danger is not addressing the problem by burying our heads in the sand. Gold insurance is beginning to look more and more prudent all the time. Old Yeller - Thanks for the post and cheers! Cavan Man (07/16/01; 20:31:06MT - usagold.com msg#: 58188) SteveH If what you report as was stated at Kitco is true then, IMO, it would be consonant with the A/FOA "message". Gold mines nationalized either outright, vis a vis taxation or, in this reported instance, swapped for US Treasuries; all variations on the same theme. "Political will" is the tail that wags the dog. Let's see if the dog hunts. Until the Euro is able to settle oil, I'd rather be driving a Titleist. GFD (07/16/01; 20:14:24MT - usagold.com msg#: 58187) A New Russian Gold Currency? My brother and I have had a long, ongoing discussion about gold over the years. We recently discussed the news article (below) about Russia adopting gold coins as an alternative currency. I would like to share his comments on this development with you.------ST.PETERSBURG, RUSSIA, JUL 9, 2001 (A&G News via COMTEX) -- The gold coins minted in the 20s are now a legitimate means of payment along with the coins minted after January 1, 1998. As a result, Russia obtained a new financial tool, capable of becoming an alternative of a dollar. The gold pieces of the bank of Russia have a higher degree of liquidity than collectible coins also minted by the bank of Russia. Firstly, paragraph 149 of the second part of the Tax Code allows the VAT exemption to the operations involving the gold pieces. Secondly, the Central Bank (CB) intends to regularly quote the gold pieces. From the CB press-release it becomes clear that commercial banks will be the first ones to receive precious coins from its deposits, and will make regular deals with the clients based upon current quotations. -----The problem with the "Western" view of Russia is that we in the west think of it as some "poor cousin" in the east. In fact, Russia sees itself as neither "Western" nor "Asian". Throughout it's history it has been torn between allying its identity with the West and Asia. Peter the Great made the first major push to swing the balance to the West by building St. Petersburg - his "Window on the West". Stalin and some of his successors tried to swing the alliances to the East (China, Middle East etc.). The fact of the matter is that Russia has looked to the west for technology, while it has relied on its eastern frontiers for the commodities that have paid for the technology and made it (or at least some of its citizens) rich. The markets for the eastern commodities have been the traditionaly been the west. Commodities have been the thing that has made Russia great in the past. First it was furs traded to the European courts that funded Elizabeth and Catherine the Great's massive "modernization" of a still medieval Russia. Siberian gold funded Alexander the 1st and his push to defeat Napoleon and build an Empire. And Eurasian Oil - of late, has provided the means for many a Nuveau-Boyar. Eastern Empires recognized that to become great you needed trade - and for trade you needed a mechanism for trade payments. The muslim empire was the first to come up with guarantees written on paper (that were enforceable by law) and this tool alone fuelled the most rapid expansion of an economic empire the world has ever seen. (The expansion of the Muslim Empire took under 100 yrs!!) This lesson from the east is not lost on the Russians. However, to their dismay, the US Dollar (and hence the US Economic Empire) is the defacto trade standard. Monetary policies created in the latter day Imperial Capital of Washington DC can be used to keep the "poor eastern cousins" in their place. No matter how hard and diligently the Russians work to become an economic power - a stroke of the pen in the USA can cause it all to come crashing down. With the introduction of the "Chevronetz" it has created a mechanism independent of the west and the sometimes malicious treatment it has had to suffer under its hand. It now has a unit of trade under its own control. The east will be more than happy to trade in gold. After all, the Chinese love it and the Mullahs of the near east cannot but condone gold's use - as the Koran commands - as the only true unit of trade. Call it the "St. Petersburg Tea Party" if you will. A small incident at first glance - but the first blow in a fight for independence. Perhaps the Russians masters have decided it is time to take what they have and - as Peter the Great once prophesied - "show our asses to the West". This - in the long term - is really big stuff. Hill Billy Mitchell (07/16/01; 20:03:11MT - usagold.com msg#: 58186) Belgian @ # 58178 Fine Sir,I certainly do agree. It is of minor importance, these quests for a bottom. You are good to let me go on in such a way without saying enough of it.About those gold funds which you occasionally follow: - I am of the opinion that those funds have little or nothing to do with physical holdings. There is no money in it for the fund managers. The fake moves here and there are to keep from losing the OPM in order to perpetuate the churning for the profit of the managers. They have no profit motive in physical metals. Just like all funds, the the eventual certainty of conflct of interest will arise. When that conflict occurs you can bet that the MGR'S best interest, commissions, will not defer to the OP's. This alone may account for their inconsistent decisions.As to FOA and the political unfolding, I sense only ridicule from his corner on the subject "never say die" physical advocates. That trail seems to have evolved more into a diversion lately. Admittedly it is a winding path that must be trod but detours need not be a part of any quest for truth.My opinion in this matter is of little consequence; however, and I do not want to put out the idea that I am not interested in what FOA has to say. Right or wrong his view should be given full consideration. It is sad that we Lilliputians have earned the disdane of Another, so much so, that we no longer really hear from him in his own words.The WA announcement, I believe, scared a few intermediate sized players, those not inside the tent, and their reaction of fear of the unknown caused a knee jerk spike which has now only put these types into a coma. They will die the death when the big one hits. My take is that the road runners will never hit the ground. Enough about the lighter side. Next time maybe grim and dim will be in order for my post.Also the last two spikes WA and the one lately did get FOA so excited that he seemed to think something was going down, even possibly the big one, causing me to suspect that he nor his mentors are in the tent. I was not fooled by the last one and will not be fooled by the next one, for if and when do not matter to me any more. All that matters is that I follow the the physical road. Being wrong is not the end of the world but steadfastness in conviction leaves one who is wrong in the end with a clear conscience.HBMPS: Never again will I call the broker for coin quotes in the heat of a spike when premiums and spreads are rediculous as I did when WA was announced. Fool me once shame on you. Fool me twice shame on me. I speak with forked tongue in cheek. megatron (7/16/01; 19:26:36MT - usagold.com msg#: 58185) Emergency room in Latin America "What happened to heem"?"He was gored by a bank" megatron (07/16/01; 19:24:03MT - usagold.com msg#: 58184) Pamplona, with a twist There could be a new tourist attraction in Latin America;The 'Running of the Banks'! Old Yeller (07/16/01; 19:14:28MT - usagold.com msg#: 58183) Time for the ol'tradition;the bank run http://quote.bloomberg.com/fgcgi.cgi?ptitle=Top%20Financial%20News&s1=blk&tp=ad_topright_topfin&refer=topfin&T=markets_bfgcgi_content99.ht&s2=blk&bt=ad_position1_topfin&middle=ad_frame2_topfin&s=AO1OHmBUgQXJnZW50 Hopefully they'll be buying gold. SteveH (07/16/01; 18:05:38MT - usagold.com msg#: 58182) Did you all see... the post on Kitco today that spoke of the Fed and Treasury having been the major buyers of future-in-the-ground gold from major hedged US mines. In return for the future gold they provided US Treasury Bonds. They then use this gold to sell down the gold market and potentially bolster the equity markets and the mines use the money to develop more mines? Buena Fe (07/16/01; 17:29:01MT - usagold.com msg#: 58181) Hubba Hubba.........here we go!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!! http://quote.bloomberg.com/fgcgi.cgi?ptitle=Top%20Financial%20News&s1=blk&tp=ad_topright_topfin&T=markets_bfgcgi_content99.ht&s2=ad_right1_topfin&bt=ad_position1_topfin&middle=ad_frame2_topfin&s=AO1NOLRSZV2Vla2x5 ALERT-Bond/currency destruction ahead.....take detour to gold!07/16 16:27Weekly Treasury Bill Sales Rise to Most in 5 Years (Update1)By Liz GoldenbergNew York, July 16 (Bloomberg) -- The U.S. sold $13 billion of six-month Treasury bills today, $1 billion more than announced last week, and the biggest bill sale in five years........................ The Treasury will have to borrow $46 billion in the quarter ending on Sept. 30 instead of paying off $57 billion, as it originally anticipated, said Ward McCarthy, an economist with Stone & McCarthy Research Associates in Princeton, New Jersey. ``The sharp deceleration in tax receipt growth will result in the largest quarterly revision to Treasury financing on record,'' he said. McCarthy expects the government to raise as much as $90 billion by selling Treasury bills, using some of the money to pay down debt maturing in two to 30 years.............. Go GATA GO GOLD Old Yeller (07/16/01; 16:53:46MT - usagold.com msg#: 58180) Looks like Black Blade... http://www2.marketwatch.com/news/story.asp?guid={6EF7EEB8-A3C4-4C03-A3D2-9B92222A0850}&symb=APC&sid=582 Is writing for CBSMarketwatch now.Interesting how these crises seem to ebb out of public view so quickly.On the other hand,they don't go away,just surprise when they return in a scarier incarnation.Thanks to BikerBear for the link. slingshot (07/16/01; 15:55:50MT - usagold.com msg#: 58179) Belgian Msg# 58167 Speaking for this Lilliputan, if the price of Gold declined it would only accelerate the buying of physical. Your statement as to there is no profile for the average small goldholder is true if you look at it from a Giants point of perspective. The small investor has only a snapshot of what is happening globally. Many rely on word of mouth,trends and maybe stroke of luck. Fortunate ones find their way to USAGOLD and educate themslves to the gold market. Order replaces chaos and understanding replaces fear when investing in PM's. Now for my profile. I see gold coins being brought.My dealers case is aways different by amount and size of coins. He has been out of 1oz. coin at times. May I add silver rounds are moving also.I hope this is happening all over the place. My guess is by the time the Paper Giants wake up, The Lilliputans,(small time investors) will have them tied up with their golden ropes of accumulation.Slingshot Belgian (07/16/01; 15:29:07MT - usagold.com msg#: 58178) @ HBM - 250$ POG bottom Sir, I am in full uni sono with your fine philosophical approach of the matter in its various aspects, described by you. Exchanging toughts about this particular POG bottom is only a miner academic excercise and you surely do agree, that it is of minor importance for our shared LT vieuws.Another aspect on this 250$ figure, is that we are missing too many reliable figures (statistics) on exact exchanges and consumption (industrial) or recycling of physical gold.And as long as Physical Goldinvestors keep hiding their real intentions...the market can surprise us all with unexpected moves either way. But we both seem to have learned to live with that.The WA announcement was (is) indeed a piece (big chunk) of the political part of the metal. But it is a two sided knife. Of course I've choosen the positive one but "theoretically" the negative one can be brought into existance as well. The collectivity can signal a total sale for instance. This to justify my statement of Gold, has no bottom or top. But as I mentionned, pure academics and far away from pragmatics.And I do agree with a load of pragmatic reasons to accept this 250$ bottom.It is the political aspect of Gold that FOA is unfolding and that is so confusing because the factor "time" is causing nervousness and demand for confirmation. I must admit that the "doubt" result, does work on me. I'm definitely not a Giant.And what is bothering me in some way is the following : the few Gold Funds that I occasionally follow in their open communication, lack some consistancy in their acts towards the accumulation of physical gold, proportionate to their communicated convictions.(confirmational evidence)I do realize that bringing this aspect into the open is somewhat delicate and I want to stick strictly to the rules of our host. Perhaps someone else has more diplomatic skills to bring this on the surface.Have a nice day. Gold Trail Update (07/16/01; 12:42:08MDT - Msg ID:58177) The Gold Trail Discussion has been Updated The Gold Trail Discussion has been updated. Click on the link to read the latest updates. Hill Billy Mitchell (07/16/01; 12:36:16MT - usagold.com msg#: 58176) Belgian @ # 58156, # 58157, # 58160, and # 58164 Sir, on the matter of $252 POG bottom etc., I would like to use the Black Blade method if you don't mind. If this offends in any way please let me know and I will not use it with you in the future. By referencing your posts I feel that any lurker or poster with a real interest in this discussion would go directly to your posts and read them thoroughly and thoughtfully, an action which I highly recommend as your view is very well formed and offers much:Snippit - Post # 58156: - "…Take a very deep breath and relax: - *** GOLD HAS NO BOTTOMS OR TOPS ***…Are you afraid or feeling uncomfortable with the impact of mining costs, against this perspective of enormous disproportionate 60.000 tonnes paper generator and 10 tonnes of newly mined gold? The impact is an absolute minimum and very limited in time. The hedging comedy is only adding to the pamperization….All this is supervised by Rand adjustments (costs) with the purpose of staying into the gold mining business for the next 100 years. With these arguments, I'm trying to relativate strongly, the impact of mining costs and amount of added new gold to POG for the future…"HBM: - Gold has bottoms and gold has tops. We just cannot predict where they are. The cost of production and replacement are watched because they are factors no matter how rather insignificant they might seem at present. Based upon your attempt to anticipate the impact of these costs on future POG, we are in complete agreement here. More on my position of $250 bottom later.Snippit - Post # 58157: - "…The whole mining strategy changes dramatically as soon as investors in physical gold decide that their wealth needs to be adjusted to reality…Sir HBM, it is all in the paper history, that our logic thinking efforts are hopelessly in vain…There is only one (ONE) alternative to optimize our risk reward position. Call CPM and discuss different strategies with the honorable gentlemen MK…HBM: - Indeedd the paper history is a very short one vs. the physical history. The vanities of our logical thoughts in the area are, as you say, hopeless, but only in the sense that "all is vanity and vexation of spirit". Wisdom is the principle thing yet we are encouraged "Get wisdom and with the getting to also get understanding." We are, I think in agreement here also, for the prudent see danger and prepare but the fool passes on and suffers hurt. You have offered the solution well as you intimate that the only one (ONE) alternative (safe route) is to accumulate physical.Snippit - Post # 58160: - "…Present misevaluations indicate a POG=300$ expectation. Don't interpret this as if gold production is leading POG. No the art of mining is following POG, profitably…HBM, I honestly don't know if your 250$ POG was a bottom…Underneath the comedy capers of the global pamperization, lies a power play. Giants have hundreds and hundreds years of age and therefore, time is not as precious as it is to us Lilliputians like moi and Auspec…HBM: - Again we are in agreement as I do not know and admit to not knowing what the bottom or top of anything is. Yet I follow some strong teaching which yet to fail me. Physical history and paper history says that cost of production and availability matters because of the threat of demand for delivery. History says that production costs strongly affect the bottom for commodities or anything, which comes on line for availability as supply through the process of production. Above ground supply has been around for a long, long time and has been more significant as factor in the supply of gold more so than deep storage gold for a long time. I understand that the present paper manipulation is unprecedented but one must one must not ignore the fact that there is nothing new under the sun and that things are as they have been and all things which have failed in the past will fail in the future as per "Rich and wise old Solomon". Poor and wise old Solomon, please offer your thoughts. There is a bottom somewhere and I just happen to think that the bottom in this case is related to production costs and met its match at the $250 level. Supply and demand for gold are part of the mix from any and all sources. There is no question that paper is one of the determining factors, the most powerful at present, but no more so than is supply an demand of currency a great determining factor in the price of all goods and services. The supply, the demand and the medium of exchange all must be considered as they all have affect upon price equilibrium. Repatriation of the dollar will do to the U.S. citizen what the Reich Mark of Weimar Germany did to the patriots of Germany. God help us all.As concerning my firm conviction as to $252 being the bottom for gold, I did make it clear in my post # 58126 that I hoped that I was wrong, when I said, "I have maintained that the $252 POG was the bottom and talks of $200 and $190 gold simply will not occur. I hope that I am wrong, for if short sellers force POG that low we will be afforded a short period of time to accumulate more per fiat unit and when the pressure created swells the short covering of the massive amounts of short which were required to force POG that low would finally bring an end to a short side of the market until we "patient ones" will have finally discovered what tremendous measure of the wealth accumulated by holding physical has really been all along."Snippit - Post # 58164: - "…It is futile at present to make any price projection. There are no references or anchors. You, humbly me and the Giants are deciding on the valuation. The Pamperers only decide on the price. Permanent confettization has to fade away before we can begin our search for an appropriate valuation reference…" HBM: - I believe that this agrees with my above statement also, "…finally bring an end to the short side of the market until we "patient ones" will have finally discovered what tremendous measure of the wealth accumulated by holding physical has really been all along…" does agree does it not, with your contention that we cannot know until "permanent confettization has faded away".Snippit - Post # 58164: - "…Goldphile Leuschel was trapped (as myself) in LINEAR THINKING! Our time frame is too narrow because we are mortals and would like to enjoy the results of our efforts with earthly pleasures. Modern times...we want it all and we demand it now! Are we good enough to carry that millenniums old store of wealth?HBM: - Sir I can assure you that I have been freed from that trap, "want it all and we demand it now! Are we good enough to carry that millenniums old store of wealth?" I quite agree that it is a trap. I am no longer operating under the assumption that the confettization will end in my lifetime. I expect that it will, (54 years old) but do not really care. My goal is to restore hope for my grandchildren should God not chose to bring this world to an end prior to the final move to reduce my grandchildren to the status of complete and unquestioned slavery. My accumulation is no longer for my benefit, save for conscience sake, but is for my future offspring. In the long run my grandchildren are not dead and the future is not now. Sir Sierra has made the point clearly pointed out the de facto situation in the USA, in saying, "The U.S. Constitution is DEAD. Has been dead for quite a while. Forget invoking the Constitution." Yet I will never give up and will invoke the constitution from a prison cell if need be. I am among the sovereign in the United States of America and will be until my dying day. Usurpers, governments in the U.S. are not de jure sovereigns yet. I am not by myself in that we will not give up, though we are few in number. No other peoples have been where we are as no other peoples have experienced our sort of freedom and justice and liberty for all. The constitution is not dead because it is in our hearts. God forbid that we let it die with our bodies. We will pass it on along with our weapons of gold and silver and indomitable spirits. With this perspective I answer your question, "Are you afraid or feeling uncomfortable with the impact of mining costs, against this perspective of enormous disproportionate 60.000 tonnes paper generator and 10 tonnes of newly mined gold?" with strong, "No I am not". I am immensely grateful for the opportunity afforded me to put my lineal descendents in a position of hope at these ridiculous prices.I understand that this is perspective unique to citizens of the USA and would not be of much interest to those around the world who have not ever known freedom as we have enjoyed de facto in the past or de jure as in the present.Very respectfully,HBM miner49er (07/16/01; 12:25:27MT - usagold.com msg#: 58175) Invisible Hand: Re: #58163 - Ponzi Scheme Sounds like the issuance of government debt. You loan them money, they pay you back with money they get from the next round of lenders (and what they can't seduce out of potential lenders, they extort in taxes). Only thing is instead of promising ridiculous returns, they pay the poorest returns, but promise security to make it worth your while.Additionally, while Ponzi was out on bail, he just couldn't help himself, and set up a fraudulent Florida land scheme basically selling lots that were, let's say, endowed with significant water-frontage...Gotta hand it to these guys... miner49er (07/16/01; 12:23:16MT - usagold.com msg#: 58174) USAGOLD: Re: #58170 - Your commentary about this Administration being of a "different stripe." Ok, Mike... I wasn't going to post anything for awhile because of time, but I'll throw out a quick one here. You mention that this Administration is of a different stripe and character. To this statement in principal, a hearty "Agreed!" However, I think this Administration realizes it is not by any means operating from the position of strength it would like. We have already witnessed a number of turnarounds and backtracks from the early and rather candid comments they made about the economy, and the strong dollar. I don't believe this was duplicitous, as much as being brought into a fuller awareness of how precariously the house of cards really is balancing on a tight-rope over Niagara in a windstorm.I think that this really is a matter of national security, and that things are being done out of consideration for protecting national interests. As much as this Administration probably philosophically does not like to intervene in the markets, it is also pragmatic enough to know what it can reasonably expect to accomplish, given the hand it was dealt. As such, certain sectors will be sacrificed simply because of a perceived "lose-lose worse" situation. I don't really believe O'Neill really wants to destroy the U.S. Manufacturing sector, but if it's a choice between losing and losing worse, they will have to go for now. This will be true of those holding contrarian investments that bet against a continuing U.S. Bull. Sort of like, "Sorry guys, nothing personal, but..."The issue at hand IMHO is not that things may be different because of the lack of a Bush-blessed intervention initiative, but whether any such initiative at this point can work at all. This is why I think one point that needs to be addressed in all this is that of the currency war. Many have discussed this here in the past in many ways. My take on it that I have written about a few times is that the critical goal is to render the Euro stillborn, or at least have it die in infancy. Without a viable alternative to the USD as a world reserve currency, the US has then purchased breathing room in which a responsible government may work at fixing things (to the degree they can be corrected), or an irresponsible one, at further abusing them.As this is considered warfare, anything is possible, and all things are disposable. I wrote this way back last September about the dollar, the price of oil and Europe:"They will try to keep oil high (but not too high) and hope to eliminate the Euro competition by destabilizing their economies (but not too much) with expensive oil. The thinking here is that if the US can keep the US$ strong (but not too strong), and the Euro weak (but not too weak), we will be able to sustain higher oil prices (though with pain and suffering -- but not too much), while Europe will not, because the pain and suffering will be worse (but not much worse)." If all else (where "all" = a mind-boggling array of considerations from JPM's swap book, to war in the Middle East) goes as planned, or at least a manageable status-quo, the U.S. belief is that it can achieve its goal of permanently relegating the Euro to a second-tier currency. Whatever this will mean as far as long term outcomes is up to pure conjecture, but as a desperate faction in a desperate situation, the visible goal will be achieved, and this will be construed as better for the U.S., than worse.Thus, I don't think George Bush & Co. can help but interfere in the markets, and I think they will fully justify it from the perspective of protecting national interests.Additionally, if what we have of the public accounts of the LTCM workout are anywhere near accurate, the Fed seemed to be more in the weak position of the parent of a long-spoilt child, now grown and incorrigible, and mollified only through appeasement. While the Fed clearly carries a lot of authority, have they the power anymore to stop the tide from washing ashore much longer?With LTCM it seems that the banks that gathered to figure out how to raise funds to do this, were hardly in the spirit of fraternal concord and goodwill, and that only the suggestion that the Fed would help ensure adding liquidity, helped finally bring enough money to the table to bring it all off.Who knows who or what is breaking as we speak. Who knows how powerful the Fed or U.S. Treasury is perceived by insiders in this go-round.What do I think this means for gold? If anyone has read this far, and cares to know my opinion, I think there is still nothing like following the ancient paths, and that there is really nothing new under the sun. Holding physical gold discreetly, and accessibly always has been, and always will be the finest way of storing wealth.Thanks Mike for the forum! Still the finest around...Best regards,miner Centennial Precious Metals, Inc. / USAGOLD (07/16/01; 12:18:08MT - usagold.com msg#: 58173) Hard assets... Easy access! http://www.usagold.com/onlinestore/special.html
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