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ARCHIVED DISCUSSION FROM 1/18/2003
All times are U.S. Mountain Time
(Yesterday's Discussion.)
mikal
(1/18/03; 23:51:58MT - usagold.com msg#: 94913)
@PH in LA
I agree with your reasoning regarding Comex credibility; you have fleshed out solid reasons for an open and honest market. But in practice this has never happened, as history shows through rules changes, scandals and manipulative rigging. I learned this here on the forum from M.Kosares, FOA, Another and from Mike Bolser, Bill Murphy, Chris Powell, Doug Noland, Reg Howe, Jim Puplava, James Turk, and many more. Also that transparency and honesty in implementing set rules and accounting methods is needed in government, markets and industry.
Yours is a most worthy goal.
But in practice this would be like throwing out the baby with the bath water. Only because the one cannot live without the other, like Chairman A.G. and his bubble baths. This is why I tend towards FOA's (Trail Guide's) vision of collapsing paper markets and hold physical only. But before they close the Comex, they will set up as many as possible into paper derivatives- futures & put and call options. If international confidence in the market continues, a change in the rules on margins and position limits may ensue and even a repeat of the "liquidation orders only" rule used at the last PM bull market, or any combination of rules changes "necessitated by circumstances". "Cash only" we have heard would expedite delivery into shorts. Rapidly devaluation of the "cash" would add insult to injury.
Ole Man
(1/18/03; 23:30:28MT - usagold.com msg#: 94912)
******369.90******
My suspicion is the POG will continue to rise after slight consolidation. This will be led by increasing dissention within the USA between Hawks and Doves relative to war in Iraq. The TED spread (T-bills vs Euro $) will lead the way to further declines in the US$. Gold continues in a primary bull market breaking out of the channel of the 1987 trend line. PM shares will move up slowly as USA equity investors confidence erodes.
24carat
(1/18/03; 23:19:16MT - usagold.com msg#: 94911)
COMEX Delivery
The exchange regulations are written to accommodate the business of moving quantities of gold. As such, from my understanding the minimum purity of gold bar required ( % regulation) is 0.925 (sterling gold). So, who, other than a bulk (aka slop mart) entity would want to get a COMEX delivery.
I have no experience in Comex delivery but do have experience in where the rubber meets the road. I myself perfer a kuggerrand and the knowing smirk of 24karat.
GratefulForGold
(1/18/03; 23:16:26MT - usagold.com msg#: 94910)
Miscellaney
Around the Corner (#.94853): I'm not quite sure how I feel about your post. I'm a relatively new poster at the Table and have had little to share in light of the wisdom and thought posted here by the many astute minds that comprise this wonderful forum. Not being a Bush fan, I was not offended by what you posted and appreciated your thoughts. However, in my reading here, I do note that most of what is said is couched in an "old world" civility that generally steers clear of nitty gritty politics. I believe much of the "conversations" that take place here are derived from the contributions of Another/FOA. The "teachings" of Another/FOA are what initially brought me to this forum. The excellent postings and education here keep me returning on a daily basis. I admit, the atmosphere here sometimes is too rarified for my comparatively simplistic mind and I sometimes get weary of the endless Euro debates and highly complex theories. When I encounter those conversations and I'm too tired or hurried to allocate the brain power to wade through/consider/comprehend – then I just use my little key to move on to the next post.
I recall Mr Gresham contemplating (and rejecting) the idea of two forums...one for the "elders" (not his words) and one for "novices" (again, not his words). In some ways, that might not be a bad idea. Some of the conversations here are among peers of a different level of understanding, and I don't think they are necessarily conducive to enlightening very new people to PMs. And, if anybody new takes the time to read many of the posts before he posts here, he would most likely be too intimidated to open his mouth. Well, not to worry, I guess – there are other forums that fulfill that need.
Christian (#: 94854): Where to buy Euros? Although I ended up not buying any (and I, too, didn't want a bank account at Everbank where I had to cash out in US$, even though my account would be in Euros (if I understood their policies correctly)) – I was told I could order Euros through most ANY bank. You can even do it online by going to a bank's home page and tracking it down through the "Currencies" section (if that bank offers that service). I tried, twice, to buy Euros online but my computer crashed each time, so I took that as an omen and didn't follow through. But, I did call my (small town, even) bank and yes, they could order Euros for me and have them in a couple of days. Carrying the "intrigue" on a little (to stop myself from declaring to them that I wanted Euros because I thought the US$ was going to the basement), I just said I was going on vacation. No big deal. (As it turns out, I'm just keeping my US$ to pay bills – all the rest of my "discretionary" fiat went into physical PMs). I'm happy.
Also, it may pay to shop around a little bit. The "premiums" can get pretty high. When I was looking, the Euro was still below parity with the US$ and I thought the premiums were high then. Who knows what they are now? Anyway, hope this helped.
GfG
PH in LA
(1/18/03; 22:42:51MT - usagold.com msg#: 94909)
Taking Delivery: Part of the Process? or an outright sham?
OK, Mr. Aristotle,
I'll give a try at "discussing" this question of taking delivery on the comex, even in the face of your arrogantly murky and supercilious answer to Powell.
Most of the scoffers and nea-sayers in the investment world who laugh at goldbugs, claim that every long contract on the comex is offset by a corresponding short contract. This means that metal owed to a long who declares for delivery would have to be produced by whatever means by the corresponding short seller to turn over to the long. Now, let us grant that this might make someone quite uncomfortable... having to supply metal to be delivered. It might even make the exchange itself want to bring pressure to bear on the long in hopes of disuading him from his intention to stand for delivery. However, the whole idea of a futures market is that any long has the right to stand for delivery on his contract. Period. Denying him the right to do so, is to assert, even admit, that the futures market is a sham.
Now, it seems to me that several years ago there was a poster at that other forum (long before this one came into existence) named "White Rose" who decided to take delivery on a single comex gold futures contract as a test, and kept everyone informed on how the process played out. He was given a long runaround but did eventually receive his metal... after a number of months of lame excuses and delays. And, yes, there were additional costs involved... storage, fabrication, shipping etc. It turned out not to be the most efficient, economical or hassle-free way to buy gold, but it did work.
It would seem incontovertable that if a financially well-endowed investor declared for delivery on a large number of contracts and was willing to follow through by insisting on delivery and paying the extra, incidental costs and fees, that somebody, somewhere, would have to produce the necessary metal for him. Now, this would almost certainly have a major impact on price. On the other hand, if one is not allowed to take delivery, the futures market is a joke, hardly fit to serve as price discovery on real metal. In fact, it should be irrelevant to a real market, with real metal.
What say you to this?
Aristotle
(1/18/03; 21:59:08MT - usagold.com msg#: 94908)
What are the odds?
What are the odds that somebody's gonna misconstrue my metaphorical comments to RPowell about middlemen and boys fetching twigs with jackknives?
I see that trouble could come of it because Rpowell had mentioned CPM in close context with this discussion on bullion banking intermediaries, and I want to make sure that on no account in my analogy was I promoting the bullion banking services over the excellent brokerage services of our host. I was simply and perhaps sloppily trying to bring forth an awareness that seemed to be lacking on the structure we now use bridging supply and demand.
[An aside.......] I won't get deeply into it here, but along that line, a person needs to assess what constitutes true "demand," and also what passes for "supply" in this sector. In appreciation of this, consider that LBMA (i.e., representative of the "bullion bankers" I was "bothering" with in my post) clears about a thousand tonnes in Gold transactions every two days.
My original point was that "lumber megastore" would sure ****seem**** like a natural place to bother with when big money and big Gold is involved, whereas in the world of small potatoes any dank old pawnshop can yield a coin or two from its shelves of hocked and stolen wares.
The enduring lesson is that people with money in size needing to broker an exchange for Gold in size are not finding the satisfaction they would intuitively expect from the bullion banking "megastore" that clears so many tonnes a day in business. The problem, you see, is that all of that tonnage is passing on banker's books -- not grocer's books. Sure, it balances when scrutinized on an institution-by-institution basis, but as an entire System there is no Gold to spare to an outside buyer wanting his Gold on the outside.
Truly, that's were MK and his excellent crew do yeoman's work in the middle ground, making the next-to-impossible task seem almost routine. It ain't easy, and that's why I call on them rather than trying to do it myself -- which would be quite laughable!!
This I hope address the issue more clearly, and gets closer to a resolution for RPowell's comment, "We need CPM for our purchases but does McEwen (a large miner) need a broker to buy 40,000 ounces?"
At the end of the day it's all about connections. Get to know your middleman and stick with those you trust.
Gold. Get you some from a good host. --- Ari
Waverider
(1/18/03; 20:45:04MT - usagold.com msg#: 94907)
Dollar set to prolong its descent for months
http://www.iht.com/articles/83740.html
Snippit:
"A weaker dollar, it appears, is here to stay. During a week in which the U.S. currency hit its lowest level since Oct. 1999, traders who move billions of dollars worth of currencies around the globe at the touch of a button scrambled to update their forecasts, predicting that the dollar could now fall much further than many had expected even a few weeks ago. The decline continued Friday as the dollar faced a triple-whammy of negative pressures: escalating moves toward a war in Iraq, a further deterioration of the U.S. trade position and several reports that cast doubt on the strength of the American economic recovery."
Waverider: Ahhh....people are finally catching on to what's been said here for months re the US$.
Gandalf the White
(1/18/03; 20:29:17MT - usagold.com msg#: 94906)
TA TA TAAA, TA TA TAAA, TA TA TAAAAAAAAAAAAAAAAAAAAAAAAAAA !!!!
COMEX POG Settlement Price Guessing CONTEST !
QUEST -- The FEB. 2003 COMEX Gold Contract (GC3G) SETTLEMENT Price on January 31, 2003:
AS OF Saturday 01/18/03 20:20 <;-) Denver Time !
PREVIOUS Days GC3G Settlement prices were:
1/16/02 Settle = $358.1 + $7.0 with a HIGH = $359.0 and a LOW = $350.0
1/17/03 Settle = $356.8 - $1.3 with a HIGH = $358.7 and a LOW = $355.3 and Sir ROCK is "King of the Hill" !!
===
A CALL TO CONTEST!!!
COME ON IN ALL you Lurkers !! Stop thinking about it and Sign-up for your FREE Password and JUMP on in here and win the FREE GOLD (or Silver) !!! Just click on the "Discussion Forum Guidelines"
LINK at the "WELCOME" statement atop of THIS PAGE!!
READ the "Rules" and request your posting "Password" !!! SIMPLE, and you can't beat the SUBSCRIPTION Price, as it is FREE !!! ( AND USAGOLD will not SELL your info either !)
---
LET the CONTEST CONTINUE !!
<;-)
===
ENTRIES sorted in order of DECREASING Values !
**** $750.0 **** Caradoc (1/17/03; 10:49:20MT - msg#: 94778
**** $419.4 **** The Hoople (01/17/03; 13:10:11MT - msg#: 94798
**** $403.5 **** misetich (1/17/03; 18:25:29MT - msg#: 94815
**** $400.0 **** Sundeck (1/17/03; 04:25:05MT - msg#: 94737
**** $396.4 **** Bulldog (1/17/03; 20:05:57MT - msg#: 94825
**** $390.0 **** Galerider (01/16/03; 23:02:41MT - msg#: 94724)
**** $387.5 **** knotakare (01/17/03; 13:17:42MT - msg#: 94800
**** $385.5 **** Skydog (1/17/03; 05:12:59MT - msg#: 94738
**** $383.5 **** GoldnSilver2002 (01/17/03; 12:14:26MT - msg#: 94791
**** $382.5 **** Hipplebeck (1/18/03; 06:47:33MT - msg#: 94850
**** $379.1 **** ha_tey_o (1/17/03; 07:24:56MT - msg#: 94741
**** $378.9 **** erayboy (1/17/03; 03:05:04MT - msg#: 94729
**** $378.8 **** miner49er (1/17/03; 14:46:29MT - msg#: 94805
**** $378.1 **** a nation of one (01/16/03; 22:07:39MT - msg#: 94720
**** $375.5 **** balzac (1/18/03; 14:15:59MT - msg#: 94880
**** $374.1 **** Slowman (1/17/03; 06:10:05MT - msg#: 94739
**** $374.0 **** Zhisheng (1/17/03; 09:53:34MT - msg#: 94762
**** $372.0 **** OZ (1/17/03; 02:14:25MT - msg#: 94727
**** $370.5 **** VanRip (1/17/03; 07:59:23MT - msg#: 94747
**** $369.2 **** slingshot (01/17/03; 12:42:13MT - msg#: 94796
**** $368.4 **** J-Bullion (1/17/03; 08:16:08MT - msg#: 94750
**** $367.4 **** Kagalaska (01/16/03; 22:29:48MT - msg#: 94721
**** $365.2 **** pilgrims_gold (1/18/03; 10:01:47MT - msg#: 94863
**** $364.2 **** Rock (1/17/03; 09:01:52MT - msg#: 94755
**** $363.0 **** luckypierre (01/17/03; 12:34:00MT - msg#: 94795
**** $362.5 **** EagleOne (1/18/03; 14:02:13MT - msg#: 94877
**** $362.3 **** Renny (1/18/03; 05:15:47MT - msg#: 94848
**** $360.0 **** Henri (1/18/03; 15:28:31MT - msg#: 94886
**** $359.1 **** 24carat (1/18/03; 16:10:36MT - msg#: 94889
**** $348.0 **** Topaz (1/17/03; 03:06:48MT - msg#: 94730
**** $274.6 **** harryo (01/17/03; 12:19:57MT - msg#: 94792
===
INVALID ENTRIES
---
NONE !!!!!!
====
THE RULES -- (We MUST have RULES !!) --- PLEASE READ !!
1) THIS Contest consists of TWO Portions --- A Price Prognostication and a Discussion Statement !
2) The Winner is the Price Guess closest to the Settlement price of the COMEX (most active) FEBRUARY 2003 Gold Contract (GC3G) on the date of Friday, the 31st of January, 2003.
3) Price "Guesses" shall be stated in Dollars and tenths !
(Such as $345.6)
4) "Guesses" shall be SHOWN in the SUBJECT BOX location AND enclosed in markers of "STARS" so as to be OFFICIAL !
(Such as ****** $345.6 *******)
5) ONLY one "Guess" per Knight or Lady is allowed, and once that "Guess" has been "taken" -- no one can duplicate it !! FIRST COME has rights to that "Guess".
6) HOWEVER, All "Guesses" MUST be posted before the clock in Denver strikes HIGH NOON on Wednesday, January 29th, 2003.
7) AND MOST IMPORTANTLY as this part MUST accompany the Price prognostication,--- A small paragraph or two must accompany your guess, as to what YOU BELIEVE to be the NEXT important gold development(s) or event(s) and why.
---
THE PRIZES !!
To the person with the exact or closest "Guess" to the February ‘03 (GC3G) SETTLEMENT price on Friday, January 31st, 2003 -----
The prize will be an ANTIQUE (OVER 100 years old) goldpiece !!
Go to the Webpage below and you can see it !!
http://www.usagold.com/ProductsPage.html
This Switzerland "Confederatio" 20 franc gold coin was
Minted between 1883 and 1896, has a gold Fineness of 0.900 and an actual Gold Content of 0.1867 troy ounce.
(Fair Market Value in Uncirculated condition is about $150.)
---BUT, it may be more by the end of this CONTEST, <;-)
ALSO, the "Runners-up" shall each receive a Canadian Silver Maple Leaf containing one ounce of PURE SILVER !
(Rich, Did you see that ?)
===
<;-)
Aristotle
(1/18/03; 20:11:39MT - usagold.com msg#: 94905)
Sir Dollar Bill
Goodness, look at that old stuff you've dug up! Knowing what I know now but didn't know then, for my part I'd grade (stand behind) the content as 90-95% (and I'd give it maybe a C+ or B- in delivery. I can be a real bull in a China shop with words sometimes.)
For FOA's part, which begins in your repost at, "A major item that has been part of this US support structure for the dollar was the G-10 policy...," I still find myself standing most firmly (97-100%) behind his content. He's been an incredible fountain of knowledge and generosity. In his absence I'm sure glad to have folks -- dare I name anyone(???)... like Belgian and Miner and MK -- all picking up the slack when some heavy pulling yet needs to be done. On that note, Holtzman needs to raise his voice more, too. Where IS that guy??!
Gold. Get you some. --- Aristotle
Mr. Bill
(1/18/03; 19:55:21MT - usagold.com msg#: 94904)
@mikal msg#: 94901
I am sure that Time, being a true American icon, would only poll the politically correct one in 250,000.
ElGordo
(1/18/03; 19:46:39MT - usagold.com msg#: 94903)
N Korea might be planning Nuke test
London Sunday Times 19th Jan (subscription needed)
A FRANTIC international effort to prevent a nuclear test by North Korea is under way amid diplomatic fears that its confrontation with America is spinning out of control.
Russia and Australia intervened over the weekend with pleas for restraint and America has asked China to dissuade Pyongyang from raising the stakes in the nuclear crisis.
Expert analysts of North Korea have warned their foreign ministries that the drama is unfolding in parallel with the showdown in Iraq and that a nuclear test could be staged within six to eight weeks.
In what one expert has called "the Baghdad scenario", the regime of Kim Jong Il is expected to wreak maximum damage on American policy by timing any move at a critical moment, such as the entry of US soldiers into the Iraqi capital.
"They are choreographing this step by step with the Iraq crisis," said one diplomat. "It's straight from the works of Sun Tzu to strike while your enemy is weak." Sun Tzu, the classical Chinese military strategist, also advocated deception and guile to win victory without battle.
By staging a nuclear test in one of the warrens of tunnels deep under North Korea's mountains, Kim would send an unequivocal signal that he cannot be treated like Saddam Hussein, the Iraqi leader.
The CIA believes that Kim may possess two nuclear devices and the Chinese government thinks he may have five. But there has never been any proof that they actually exist.
A verified test would resolve that but it would also pose a dilemma for America, forcing it to decide between taking military action and striking a deal with a member of President George W Bush's "axis of evil". Its gravest consequence would be to maximise pressure on Japan to develop its own nuclear missiles, destroying the balance of power that has kept the peace in northeast Asia for half a century.
China last week told James Kelly, an American envoy, that Beijing's confidence that Kim did not intend to build more nuclear weapons had been shaken, diplomats said. In a bleak assessment, a senior official told Kelly that North Korea's decision on January 10 to pull out of the nuclear non-proliferation treaty probably signalled a change in intentions.
Intelligence services from six nations have apparently proved unable to find out what Kim's scientists are doing with stocks of plutonium from a Soviet- designed nuclear reactor at Yongbyon. Nor can they trace supplies of highly enriched uranium from a second, clandestine programme.
Aristotle
(1/18/03; 19:41:04MT - usagold.com msg#: 94902)
Especially for RPowell
""""the question remains why Mr. McEwen did not simply buy on Comex and take delivery.""""
Go ahead. Try it for yourself. Then, have another look at exactly what I wrote to you as the reason. Understanding comes with experience, or, if we're lucky, through a patient friend instead. Your choice.
""""Why bother with any bullion bankers?""""
Why *bother* with them??? Hello! When you want to build a house, do you not go to the lumberyard? I imagine it will change some day, but such is the structure we have today. But sure, if it's only a twig you want, any kid with a jackknife can fetch one down for you. The size of the task dictates your middleman.
Let's not agree to disagree if we don't *have* to leave this open and unresolved. Tell me what you know, and I'll maybe accept it. On Buffett, prove to me the following: For each 5,000 oz block of silver that left Scotia or HSBC (or Republic or whomever the heck it was doing duty back then) how many can be correlated directly to long contracts that WB chose (or gave the orders) to acquire **specifically for the preplanned purpose** of holding 'til expiry and physical fulfillment?
So many people have been fishing these waters it's a wonder they don't quite know what it is they're catching. No point in fussing over details, right? We've got fish(???) to fry!
Gold. Get you some. --- Aristotle
mikal
(1/18/03; 19:40:15MT - usagold.com msg#: 94901)
@Mr. Bill Re: msg 94896
Just got back after a refreshing little sabbatical and read your exemplary post.
Speaking of "fool all of the people", I just saw El Gordo's post on the Time/CNN popularity poll.
This is right up there with the "person of the year" gala, which with their weekly tradition of exacting "news for the serious student of current events", makes Time magazine so beloved in every true-blooded American home.
I've posted on similar polls several times. Talk about classic statistical INSIGNIFICANCE! Let's see, there were 1,010 respondents. Sampled out of 250,000,000+ population. That's about ONE in 250,000!
Hello?
Have we ANY senses left?
Or is this unified, homogenous thinking from watching TV, Time mag and loyal acquiescence to our fearless teachers, from preschool onwards?
Naa, only in communist countries.
Dollar Bill
(1/18/03; 19:17:42MT - usagold.com msg#: 94900)
Knight Aristotle, would you care to address the Round Table.
I was reviewing some of the Hall of Fame Teachings, and
I raise my (Gold) Goblet of Grog to you for your report from the Kings Counting House, and of course, the other Hall of Famers.
"The dollars America was able to issue via simple printing carried the same value in trade as the dollars that had to be earned by other nations through meaningful productivity." -------No question of this one, I did find it a great reminder.
"the System (international financial system) could not survive a Third Oil Crisis--the inflation would make it impossible to recycle the petrodollars to the oil importing countries with any hope of repayment, trade would crumble, and the System would be brought to its knees"--------Here you were reporting the opinion of someone in about 1980.
I am just hopefully guessing that perhaps structurally
things have been changed to survive the next wave of inflation of fiat. There has been discussion that besides
trading oil in dollars, the companies that import and export goods throughout the world have a deciding impact on what currency is reserve by thier choice of which currency to use. I mention that thinking that perhaps that is a new element that might be a factor.
"The CB's are fretting because their guarantees were used over and over again, and they are on the hook for a lot of Money (Gold) when the speculating Hedge Funds and bullion banks find it impossible to cover their Loan repayment obligations on the spot market as the price races away from them due to the hypersensitivity that low supply has caused. Shades of Rotterdam. Currently aggravating this spot market problem is the massive demand by individuals brought about by the low prices and concerns for Y2K. I hope this give you new perspective on the push lately by some CB's to free up some Money (Gold) from the vaults, whether it is Bank of England, IMF, or maybe even Swiss. It should also give you perspective on the anti-gold propaganda delivered regularly by the media. Consider that a skyrocketing price of Gold would not only be viewed by the masses as a viable investment avenue, it would also tend to shake the confidence in paper currencies, and threaten the banking system and Wall Street in general."
--------I dont recall if this is a quote of yours, but it echoes my concern that thier is a threat to our system. I would like to fully relax as you suggested to me in a kindly post after my latest challenge to the Black Knight Murphy. But I do still need to upgrade my knowledge of our situation to understand the structure of the "bridge".
"
"When this paper system collapses, the gold metal that always remains will inherit the value currently spread thin throughout the expansive paper system.
A major item that has been part of this US support structure for the dollar was the G-10 policy on gold. The falling gold price, as seen in the world reserve currency has contributed immensely to the ongoing settlement of all trade in dollars. Indeed, the very continuation of the world trade system. Leading the dollar support component of trade was the use of crude oil settlement in dollars. That one item required practically every nation on earth to buy dollars (or at the least run a positive dollar trade balance with other dollar holding countries) to pay for oil
the continued physical function of the established world gold markets was paramount in holding this oil support for the dollar. When the day comes that the paper contract gold markets are seen as "in question", the flow of oil will slow and its price in dollars will rise. From early this year, this process has begun.
Further, a falling dollar will release ECB dollar reserves as fair game to buy physical gold from any and all entities. However, this buying will most likely be through the BIS and member CBs, not the over leveraged LBMA [London Bullion Market Association] or world gold paper"
"Because this process creates a unique reserve benefit, not used in the old gold standard, they will never officially back the Euro with gold. Rather, allow a new "free market" in physical gold (not paper) to supplement their currency operations. The efficiency of modern trade requires a digital currency. That need alone will always support the use of a currency. If gold can trade beside paper money, neither will drive the other out of circulation (as old money gold coins did to paper gold money) as long as they can each seek their own values. ( a very interesting concept??)
It was pointed out to me that our great world gold market is the most liquid it has ever been. The members have many reserves and even insurance companies to back them. I completely agree! They will not fail one investor with the lack of cash settlement for all remaining, unsettled claims. The dollar/IMF block of countries will print whatever money is needed to clear out this arena. Just as the US once before called in gold and settled up in "local gold backed cash" because the foreign dollar gold loans had failed, this time will they call in "real gold paper" and settle in "absolute fiat cash"."
----------- This is not part of your writings, but on the same page. Do you think any part of this, well, any comments on it?
Again, a raised Goblet Toast.
Cavan Man
(1/18/03; 19:16:35MT - usagold.com msg#: 94899)
R Powell
Maybe the answer is the COMEX isn't the only game in town. I prefer USAGOLD but there are obviously other vendors. COMEX is stil working a half day; why? Buying metal is dependant in large part upon relationships and trust.
Malfleur
(1/18/03; 19:13:43MT - usagold.com msg#: 94898)
(No Subject)
SA Gold Mines: Thanks
Many thanks to Topaz, Boilermaker and Max Rabbitz for their comments. I hope that the latter is wrong about nationalisation...
Boliermaker, I thought that HMY had pegged an exchange rate at about R11.30:US$1 and so should have avoided most of the ill effects of the strengthening rand.
By the way, NASDAQ price link shows the two stocks down in US$ while Kitco has them up in rand at the close of business. Curiouser and curiouser, although I understand that New York and Jo'Burg are in diffreent time zones.
R Powell
(1/18/03; 19:08:24MT - usagold.com msg#: 94897)
The question remains
Aristotle, I realise that Comex is a "major component in price discovery" and suspected (as is the case with silver) that Comex is "Not an integral part of the distribution stream for gold." Thanks for some confirmation.
However, the question remains why Mr. McEwen did not simply buy on Comex and take delivery.
Also unanswered is the question of whether McEwen could simply buy directly from other sources. Why bother with any bullion bankers? Bullion bankers do not produce gold. I don't believe silver transactions require a middleman. Silver certainly does not flow through the Comex. Middlemen exist, I'm sure, and are probably necessary for many purchases but how many? We need CPM for our purchases but does McEwen (a large miner) need a broker to buy 40,000 ounces?
The fact that Comex stores are stored in bullion banks does not answer the question. You and I may have to agree to disagree on whether metal delivery is possible through a Comex contract. I believe it is. So does Mr. Buffett.
Any other thoughts?
Rich
Mr. Bill
(1/18/03; 18:08:12MT - usagold.com msg#: 94896)
@Tacitus msg#: 94894
You can fool some of the people. Especially when you own the media. Or rather when the people that own you also own the media.
Tacitus
(1/18/03; 18:02:20MT - usagold.com msg#: 94894)
Is "Around the Corner" way off base?
Dear Fellow Posters and Viewers,
In posting #94853, "Around the Corner" rips on Dubya. One item, amongst all the rest he got wrong, was his polling numbers. The fact is that George W. Bush's popularity was steadily going up right up to 9/11. Then it sky rocketed. And make no mistake about it, his numbers are still very high for a president, close to 60 percent.
I think "Around the Corner" wishes Al Gore was our president but not for the right reasons. He would like Al Gore to be president because then, Gold would really be going through the roof.
In all seriousness guys, I think we get a little too negative at times. There are a lot of good people in this world, including in the government, and I mean both parties.
So cheer up, buy some gold but don't be in a panic. God is with us, even though we are a stiff necked people.
Salve,
Tacitus
Aristotle
(1/18/03; 17:59:15MT - usagold.com msg#: 94893)
RPowell and the COMEX oddsmaker -- a betting window, not a storefront.
COMEX is not *not* NOT an integral part of the distribution stream for Gold. It is, however, a major component in price discovery.
This has has all been covered before. I for one tried to help you out not long ago with a detailed breakdown on the meaning, or should I say misnomer, of COMEX inventory. I'd think a man with your keen interest in these sorta things would already be on top of all of this. Metals listed, sitting, coming or going, need not have any connection with the future's trade on the Exchange. If I were to pull kilo bars of Gold outta storage at HSBC on Tuesay, you'd see the so called "COMEX inventory" fall, all without a single contract being involved or affected.
If Rob were to try to take your implied advice to use COMEX as a conduit, he'd find himself in a conversation with someone like good ol' Nick at the Exchange at his persuasive best -- telling him how he's sorely mistaken the whole point of the Exchange, and to please run along and pursue his physical Gold elsewhere through *proper* channels.
Does this bring you up to speed, or at least refresh your memory? If it doesn't, then I'm gonna bow out here on this deal having previously given it my best shot with a full treatment. The task in the face of my failure falls to these other good fellows.
Gold. Get you some. --- Aristotle
Mr. Bill
(1/18/03; 17:38:56MT - usagold.com msg#: 94892)
@Around The Corner msg#: 94853
Keep up the good work. Them other guys are obviously confused.
Rock
(1/18/03; 17:34:32MT - usagold.com msg#: 94891)
Re: around the corner
I have to concur with White Hills, your way off subject and your posts are very distastful to tell you the truth.
R Powell
(1/18/03; 16:26:05MT - usagold.com msg#: 94890)
M.K. // Rob McEwen and large gold orders
It was indeed an interesting story. May I ask a few questions of you or anyone who cares to offer any thoughts?
The article stated that bullion banks (plural) were approached for this purchase. How is newly mined gold transfered from miner to buyer, that is, what is the normal marketing route for the sale of gold that hasn't already been promised by a previous sale (hedged)? Are bullion banks usually involved or could Mr. McEwen have purchased directly from other miners or other souces?
Also, why was the Comex overlooked? Buyers standing for delivery off Comex would create the most publicity as to the existing supply and demand situation, no? I do not believe that silver travels through Comex during its journey from producer to end user, is this also true of gold? Both silver and gold have recurring yearly deficits in regards to supply and demand but, it seems, whether by lack of knowledge of its existence or through the discounting of its importance, this deficit seems totally incapable of pushing prices higher. Perhaps the POG is responding somewhat now, silver certainly hasn't yet.
When Buffett wanted silver he went to the Comex. Why did Mr. McEwen choose the bullion banks over the exchange?
Thanks,
Rich
24carat
(1/18/03; 16:10:36MT - usagold.com msg#: 94889)
******359.10******
The major upward force in the coming two weeks for gold will be the ongoing situation in Iraq coupled with an unfolding energy crisis. I live in southeasten Indiana and this morning it was -7.
The flip side of the coin has to do with options expiration and the ability of the paper giants to use the market to their advantage. Their infinite profit lies in the ability to control and control they will. The American investing public has been totally removed from precious metals permanently and without the help of the masses the going will be much tougher.
Cometose
(1/18/03; 16:04:41MT - usagold.com msg#: 94888)
Fed Chairman's house burglarized
THERE IS NOT HONOR AMONG THIEVES.........
THE CHICKENS ARE COMING HOME TO ROOST....
TIME TO PAY THE PIPER....
HE'S ONLY JUST BEGUN ........ SCARY THOUGHT
Boilermaker
(1/18/03; 15:58:28MT - usagold.com msg#: 94887)
Usul - Fed Chairman Greenspan's house burglarized
OK, which one of you guys burgled AG and did you find any gold?
Henri
(1/18/03; 15:28:31MT - usagold.com msg#: 94886)
*******$360.00********
Last chance for those who have not yet jumped onboard to get on. This train is leaving the station and will not be accessible at $450 and higher. Just won't be anyone willing to sell anything but paper.
GoldnSilver2002
(1/18/03; 15:17:37MT - usagold.com msg#: 94885)
Gold stocks havent kept up with gold?
I have recently been pondering this issue of why gold mining stocks havent kept up with the p.o.g.This is not entirely correct.I will not pump a stock but across the pond,away from the influence of north american media?On the london exchange there is one gold stock which has gone from approx 10 pounds to now about 37'since november 2002.This lead me to one possible conclusion,negative media hype and ignorance.In north america,investors are told,the war will be quick,this is just a blip.The scars of july are still fresh in the publics minds as the media blurts "gold is going down!" or this is just the "Iraq affect."I found in europe they have learned from past experience(the nazis),how damaging propaganda is on a gullible public.As a result,the gold suppression story gets some creedence and gold is openly discussed.All we hear in north america is negative."Gold is down!after a quick war it will go down"they scream.After being wrong for 2 years straight.
Gold now sits nicely at 356,above the maginot line of 354.50.The north american media can slow us down,but not the rest of the world.We wont wake up until gold hits 400,which may very well be too late to get physical.At that point people will be forced into whatever gold stocks wall st is pumping'such as the hedgers.Once again many lemmings will get fleeced.Its the rest of the world dragging gold up,not us yet."Time is on my side,yes it is."
ElGordo
(1/18/03; 15:08:10MT - usagold.com msg#: 94884)
UN finds nuke documents
http://news.bbc.co.uk/2/hi/middle_east/2672825.stm
The head of the United Nations atomic agency has voiced concern about documents apparently relating to nuclear technology which were found in an Iraqi scientist's home.
The documents, numbering 3,000 pages, appear to focus on laser enrichment - a way to modify uranium for use in nuclear weapons - and were taken from the home of physicist Faleh Hassan on Thursday.
White Hills
(1/18/03; 14:44:50MT - usagold.com msg#: 94883)
Around the Corner Msg#94853
Sir: I suggest that you go back and read the rules that govern the discussion on this Forum. Sometimes there is good reason to discuss some aspects of politics in making some economic point that support your views. But, this post falls way out of line of any economic discussion. I visit this forum every chance I get to find out the latest news and to get the latest views of the forum. This Forum is very important to me and I certainly don't expect to read Post like yours. I suggest that in the future you would realize how offended some people are to your type of Post. Stick to Gold and economics. White Hills
ElGordo
(1/18/03; 14:32:12MT - usagold.com msg#: 94882)
CNN poll Gloom and Doom
New York -- Over half of Americans (53%) polled approve of the job George W. Bush is doing as president, according to the latest TIME/CNN poll.
His approval rating has dropped slightly from 55% a TIME/CNN poll in December
Over half (56%) say the country is in deep and serious trouble, while over a third (39%) say the problems we face today are no worse than at any other time in recent years.
Only a quarter (27%) think economic conditions will get better in the next 12 months, down from 35% in October 2002.
Over half (51%) think Bush is doing a poor job handling the economy, while half (50%) think he is doing a good job handling foreign policy.
The TIME/CNN poll was conducted by Harris Interactive by telephone among 1,010 adult Americans age 18 or older Jan. 15-16, 2003. Margin of error for total sample is +/- 3.1%. Full poll results attached.
__________
Rock-Its a great article, does sum it up well. Its amazing
Barron's is even mentioning the possibility of "D" word.
Usul- Greenspan being burgled-too funny.
Mr Gresham
(1/18/03; 14:23:58MT - usagold.com msg#: 94881)
Doug Noland
http://prudentbear.com/creditbubblebulletin.asp
"For those of us who have watched this company (AmeriCredit) since its early days as a used car dealer in Fort Worth (U-Car-Co), it is rather incredible that near failure in the early nineties was transformed by Wall Street structured finance into a company with managed receivables of over $16 billion.... It is worth noting that behemoth Credit insurer MBIA jumped into the fray by providing insurance on a $1.7 billion securitization in October, MBIA's first deal with AmeriCredit. The Credit insurers (and the holders of their insured bonds) will regret ever conjugating with subprime lending. What could they have been thinking?"
Conju-wha??? What could Doug be saying? That must be Australian for, uh, ... Let us admire the restraint that Doug HAS shown over the years, as he watches the inmates run the asylum. I'm sure he is saving his finest superlatives for an hour that transcends financial mathematics entirely.
balzac
(1/18/03; 14:15:59MT - usagold.com msg#: 94880)
GOLD CONTEST: Brevity is of the essence.
**** $375.5 ****
Two factors will affect the price of gold over the next 2 weeks.
I would rank the trade imbalance first, for if continues at the present rate, it will amount to $480 billion for 2003.
This would be disasterous for the USA.
Secondly rumors of war will increase and the insecurity thus generated will increase demand for gold to about $ 10. by Jan.31st.
Balzac
Usul
(1/18/03; 14:06:43MT - usagold.com msg#: 94879)
Fed Chairman Greenspan's house burglarized
http://biz.yahoo.com/rf/030117/crime_greenspan_burglary_3.html
Oh, the Irony!
Rock
(1/18/03; 14:04:33MT - usagold.com msg#: 94878)
Elgordo #94873
Great post. That about sums it up in a nutshell.
EagleOne
(1/18/03; 14:02:13MT - usagold.com msg#: 94877)
***** $362.50 *****
The next important gold development? The trouble is it's all important, but the only way my limited faculties can make sense of it is to just let the market price and volume tell me what is actually happening.
Many important market drivers will be discussed on the forum but all of them or none of them are important except what effect they, along with other unknown events, may have on the POG. As these forces combine in 2003 to move the POG, I think it's a big mistake for investors to focus on some pre-conceived conditions or events and wait for that to happen before investing...or withdrawing.
Nevertheless, the next important gold development could/may/might reveal it's significance by strong resistance at 400. This hesitation in the rising POG could mark the completion of the cup formation began in early 1996 and a initiate a consolidation (handle) lasting several months and retracing 15 to 20 points. These conditions could then be the setup for a serious break-out above 414 as the media and our next-door-neighbors all begin to discover the merits of buying and holding gold.
Best of luck to all posters old and new and heartfelt thanks to our host.
MK
(1/18/03; 13:53:04MT - usagold.com msg#: 94876)
Rock. . .
Thanks for you comment.
There are still a great many who don't kow the difference between a hedged mining company and unhedged one. There are still people who don't understand the difference between owning a gold stock and owning the real metal. For awhile, we had posters here defending the hedged mining companies. For some unexplained reason, they have drifted into the nether left behind by the overall stock market bubble.
To make a long story short over the past year while gold rose from $270 to $355, GoldCorp, an unhedged miner and owner of the hard metal as a reserve, went from roughly $6 to $12.50; Barrick generally criticized for its hedging policies went from $16 to $16.
There are great differences between stocks in different mining companies; there are great differences between the stocks and gold itself. One is not, and cannot be, a proxy for the other. In the most recent gold run-up only a handful of stocks have risen with it. To me, it looks the stocks got ahead of the market and need a good lift in the gold price to justify current p/e ratios. If true, that makes the metal itself more attractive to speculators at this time and that may be why gold has stubbornly held above the $350 level. The hedged companies are doomed unless they find some way to cover their hedges. Much of their production is locked-into sales programs on the other side. They will not participate in any future gold run-up but are merely being operated like utilities for the benefit of bullion banks who counter-signed on all these loans and intend to see them repaid. Even if they wanted to dip into capital and buy gold on the open market to close out the hedges they might not be able to if McEwen's experience in the gold market is indicative (and I think it is.)
Be careful out there, my friends. A good friend and gold stock analyst pointed out to me yesterday that one prominent Wall Street firm -- a household name -- recommended gold recently. A good thing, one would think. They then topped it off by recommending a list of four or five hedged mining companies (never bothering with a mention of owning the metal itself) -- proof positive that little has changed on Wall Street despite the corporate and financial scandals reaching the nation's front pages. If I weren't so used to this sort of thing, I'd have a hard time laughing it off. As it is, we had a good laugh about it. Nothing's changed in the bubble aftermath. On a positive note, many of us -- at least those who frequent this Table -- know what recommendations like that are all about. As I say. . . Wall Street hasn't changed; it's just lying low.
Shapur
(1/18/03; 13:16:50MT - usagold.com msg#: 94875)
a few thoughts
can it be possible that we are at the start of a major league oil shock? I think it could be quite possible that we are. Black Blade, do you remember if there was an opec meeting in/with Venezuela prior to the social breakdowns? And remember the failed coup? Maybe the Venezuela situation is a real live card being played, a real log in the base of an oil price fire, with Iraq as the match, and an unknown accelerator waiting to get splashed into the mix?!
there has been much talk about gold going up into the war and then falling as the bombs start dropping. Maybe gold falls off as expected and then rockets ahead as the real fire begins to burn in oil prices??
any ideas?
Rock
(1/18/03; 13:10:57MT - usagold.com msg#: 94874)
Re: MK & Goldcorp
Great piece of info there Mr. K let me tell you, it speaks volumes. Now we can see what happens if some of the big hitters start placing orders for deliverly. Looks like the new "Enron" is about to be uncovered. I'm looking forward to next weeks economical activities. If your in the SM its a long nail biting time of nervous antipation and false hopes however if your in the precious metals market its a time of sweet sleep and eager anticipation as we watch gold make its accent. Have a great weekend.
The Rock
ElGordo
(1/18/03; 13:07:08MT - usagold.com msg#: 94873)
One of the most depressing articles to appear in Barron's in many years
http://www.FreeRepublic.com/focus/news/825013/posts?page=1
BUBBLES HAVE LONG BEEN part of the financial firmament. The tulipmania in 17th-century Holland and the notorious South Sea Company stock bubble a century later in England are lowlights of economic lore.
History is replete with numerous other examples of financial manias followed almost ineluctably by huge price busts, down to our own era. Japan is still paying the price of deflation and economic narcolepsy a decade after bubbles in its stock and real-estate markets popped. Debt collapses in Asia and South America punctuated much of the 'Nineties. The bursting of the U.S. tech-stock bubble in early 2000 led to the vanishing of more than $5 trillion in wealth, at least on paper.Now, many worry that a U.S. housing bubble, lofted by four-decade lows in mortgage rates, could explode, eviscerating consumer spending and economic growth.
Curiously, however, one reads almost nothing about what may be the biggest bubble of them all -- the huge ballooning of total debt in the U.S. That measure, an aggregate of the borrowings of all households, businesses and governments (federal, state and local), zoomed up from about $4 trillion at the beginning of 1980 to $31 trillion as of 2002's third quarter, according to the latest available Federal Reserve flow-of-funds data.
While some observers see no cause for alarm in these figures, others fear that this debt surge could be edging the U.S. economy toward the abyss of a bust -- and then into a depression.
Reality Check
The 'Nineties economic boom boosted wage, profit and productivity growth, enhancing the ability of consumers and businesses to service debt. Yet, after-the-fact revelations about the accounting shenanigans of that period lead to an important question: How much of the profit boom and productivity miracle was real?
It may have been as much an artificial product of debt leverage as of true internal growth. Credit-market debt now equals 295% of gross domestic product, compared with 160% in 1980 and less than 150% during much of the 1960s. More ominously, debt as a percentage of GDP exceeds the previous record reading of 264% from early in the Great Depression -- when the aftermath of the Roaring 'Twenties borrowing binge collided with a sharp economic contraction. And today's debt load is clearly starting to pinch consumers and businesses: Credit-card charge-offs of bad loans exceed 7% of total debt outstanding, compared with the previous peak around 5%, reached in the mid-1990s, according to Standard & Poor's.
Engorged With Debt
U.S. personal bankruptcy filings in last year's third quarter jumped some 12% from the level a year earlier. And when 2002's total is in, it will almost certainly eclipse 2001's record 1.43 million.
Meanwhile, mortgage delinquencies are soaring, particularly among less creditworthy borrowers. In the "sub-prime" market, delinquencies have jumped to 8.07% from just 4.50% in 1999, according to Loan Performance, a San Francisco tracking firm. This market, which caters to people with checkered credit histories, accounts for about 10% of the $5.8 trillion of U.S. mortgage debt currently outstanding. Delinquencies on Federal Housing Administration loans, which make up about 15% of the dollar amount of U.S. mortgage debt, are at a 30-year high of 11.8%. The typical FHA borrower is a first-time home buyer with limited funds.
Around The Corner
(1/18/03; 12:14:56MT - usagold.com msg#: 94872)
(No Subject)
Sector
Saddam has most likely transported his WMD into Saudi Arabia. A few months back (last summer when Saddam was visiting his neighbors) the main road from Iraq to Saudi Arabia was suddenly reopened after a decade long closure. (If you remember during the Gulf War, Saddam sent 40 of his fighter jets to Iran.)
This may be the reason Saddam is being so cooperative with the UN inspections as well as the reason why the US hasn't already moved on Iraq...they both know there are no WMD in Iraq. If the UN inspectors were smart, they would be looking for evidence that Iraq's WMD had been recently transported into Saudi Arabia.
If Saddam has in fact sent his WMD into Saudi Arabia for 1) safe keeping, and 2) to protect Mecca from invading "Crusaders", then the very thing Bush and Cheney say they are trying to prevent...WMD in the hands of terrorists....is exactly what they have forced to take place. Never forget...15 of the 19 terrorists on 9/11 were Saudis.
One thing you can always count on...whatever Dubya & Co. touches...quickly turns to crapola.
Buy Gold and Silver...and be quick about it.
ATC
slingshot
(1/18/03; 11:49:25MT - usagold.com msg#: 94871)
coin dealers
I have noticed that the coin/bullion dealers in my area have been closed one weekend a month to visit coin shows or doing inventory. Hmmm.
Slingshot----------------<>
MK
(1/18/03; 11:09:58MT - usagold.com msg#: 94870)
GoldCorp & Rob McEwen
http://www.usagold.com/gildedopinion/McEwen.html
Had an interesting phone call from Victor Webb yesterday. I met Victor when he did publicity work for the World Gold Council years ago. He still helps them out on occasion, but has now hooked up with Rob McEwen at GoldCorp ( a good meeting of forces ) and called to see if I was up to speed on what McEwen and GC were involved in. I said I was and pointed him to the Gilded Opinion piece we put up in November (linked above), and asked him if there was anything new.
McEwen exposed the fatal flaw in the paper gold market recently when he attempted without success to purchase a modest 40,000 ounces of gold on the open market. The story was not so much that he tried to purchase that quantity of gold, but that the bullion banks couldn't put the deal together for him. At the time I said that this might have been the most important gold story of 2002, and I'm going to stick to that.
Victor tells me that Gold Corp owns 196,000 ounces of gold -- in its corporate treasury!! (How many mining companies could make such a boast?) That reserve position is greater than 41 of the 112 nations now holding gold (and he isn't leasing it out).
Gold Corp has accumulated this gold in two ways, says Victor, first by witholding some of its production and second from purchases in the open market. It added 17,000 ounces from production in the 4th Qtr,2002, and now has accumulated 96,000 ounces in this manner. It has acquired 100,160 ounces by the second method and none in the 4th quarter due to the failed attempt to purchase already mentioned.
Victor emphasizes that the value of GoldCorp's reserve is roughly $67 million, and $9 million was gained in the fourth quarter 2002. I would think that that number has jumped even more with what's gone on in January.
Consider if every mining company took the same approach Rob McEwen has (instead of the diametric opposite, as is the case with some mining firms who have sold several years of production forward). . . . . . He is to be commended, as I said late last year, and an ally to physical bullion holders like most of you seated at this table. One of the more interesting aspects of the McEwen strategem was that he was told earlier by bullion bankers (at Michelle Ashby's Denver Gold Group Annual Conference) that they could acquire 640,000 ounces of gold without a problem in a couple of days. Forget the 640,000 ounces, they couldn't even come up with 40,000.
Said McEwen: "There is something weird in this market when the assumption is the nominal liquidity is out there and broad, but when you go to physical, you have trouble getting it. So the real liquidity I think is much diminished. If we can, through our actions encourage other people to buy gold and other producers to withhold gold, maybe it would bring about a tightness that would be beneficial to the industry. I mean, 40,000 ounces!"
Victor Webb promises to keep me informed of Mr. McEwen's activities, and I will pass it along.
The full interview is interesting to say the least and available right here at USAGOLD. Go to the link above.
---------------
Good luck to all in the new Contest. It should be an interesting time for this. I can almost hear the wheels turning. . . . . . .
USAGOLD / Centennial Precious Metals, Inc.
(1/18/03; 11:07:55MT - usagold.com msg#: 94869)
In bookstores for $14.95. Get it here for ONLY $5.95
http://www.usagold.com/cpm/abcs.html
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