ARCHIVED DISCUSSION FROM 1/19/2003
All times are U.S. Mountain Time
(Yesterday's Discussion.)
Trojan
(01/19/03; 23:09:25MT - usagold.com msg#: 94981)
I Detect A Sea Change In Attitudes To Bush
I was just reading a column in the NY Times by Frank Rich called "Joe Millionaire For President"
I think it reflects a much more critical look at the President's Policies.
The same critical look other countries around the world have had for months. I also think this problem is not helping confidence in the Us Dollar.
The end of the Article:
Nor does anyone know what vanquishing Saddam and then governing Iraq will cost in either dollars or lives.
Lawrence Lindsey, the chief White House economic adviser, was fired after he put the bill at $100 billion to $200 billion. But William Nordhaus, the Yale economist, puts the Lindsey estimate at the low end, with the high end being $1.6 trillion over a decade.
Whatever the number, the cost of the war isn't being factored at all into the budget proposal the White House will send to Congress, according to USA Today.
Yet even with that huge sum unaccounted for, the tax cuts and deficits are already so out of control that budgetary allotments for homeland security are being cut back.
As for the American troops to be thrown at Saddam, remember those leaked Pentagon war plans from last summer that capped the total at 250,000? This week ABC's John McWethy reported that the number had escalated to 350,000 before the battle is even joined.
Mr. Bush's rhetoric says we can have it all — lower taxes, better schools, a war or two or three, civil defense — without pain. But the numbers don't add up, and when the expanded war becomes a reality, we'll see a bottom line that not even the smoothest politician's bedside manner can obscure.
While we wait, an anxious nation whiles away the time with "Joe Millionaire," a "reality" TV show in which a sweet-talking con man charms a bevy of credulous women into believing he will give them a fairy-tale ending.
And why not? It's a perfect reflection of the reality of this moment, right down to its predictable, all too inevitable, denouement.
Black Blade
(01/19/03; 22:29:23MT - usagold.com msg#: 94980)
Low inflation? Only if you're an economist
http://www.marketwatch.com/news/print_story.asp?print=1&guid={A9664F72-7233-41ED-895D-1B49666C08DC}&siteid=yhoo
Snippit:
NORTH PALM BEACH, Fla. (Bankrate.com) -- The second consecutive monthly decline in the core Producer Price Index has spurred more concern about the potential onset of deflation. A lack of inflation? Hardly! An increasing rate of inflation amid a further decline in nominal interest rates has anyone living on a fixed income understandably uptight. All figures are unadjusted data, which as stated on the Bureau of Labor Statistics Web site "are of primary interest to consumers concerned about the prices they actually pay," as opposed to seasonally adjusted data that eliminates fluctuations due to climate, holidays and production cycles.
Although the core CPI, which excludes the volatile sectors of food and energy, was up 1.9 percent in 2002 vs. a 2.7 percent advance in 2001, I don't know too many people exempt from food and energy costs. Food costs were up 1.5 percent last year, but the index for fruits and vegetables increased 4.9 percent. Who said it doesn't cost more to eat healthy? Energy costs accelerated 10.7 percent last year. Since it gets mighty cold this time of year in most parts of the country, my guess is that many households are feeling a draft in their wallets every time they turn the thermostat up a few degrees.
Transportation costs rose 3.8 percent, but gasoline costs were up a staggering 24.8 percent in 2002. Presumably much of this is attributable to unrest in Venezuela and uncertainties surrounding potential war with Iraq. Nonetheless, think about that the next time you're tapping your foot at the pump while filling up the SUV.
Housing costs were up 2.4 percent, and even water, sewer and trash-collection service costs jumped 3.2 percent. Many families send their kids to private school and are trying to save for a college education. Education costs climbed 6.6 percent, including a 6.2 percent jump in the category of "tuition, other school fees and child care."
Medical care is another staple of every household, and costs have increased here, as well. Somewhat surprisingly, the index for prescription drugs was virtually unchanged, though I'm sure there are many that will dispute that. Hospital and related services led the charge, advancing 9.8 percent.
Black Blade: YES!!! I have been pointing out for years that the BLS is BS. The statistical massage with phoney baloney filters, hedonic deflators, seasonality, etc. renders the BLS data utterly useless and meaningless. It has been used to deceive the US public and rip off elderly citizens on Social Security while absconding with the tax for the General Account while paying out a few miserly crumbs to the Alpo eating recipients.
TownCrier
(01/19/03; 22:17:07MT - usagold.com msg#: 94979)
The investor's bottom line
For those who can't find the time necesary to read through Jim Puplava's expansive commentary, here is the bottom line that might be of most interest to you.
----Excerpt--------
The economic and financial risks are high. However, the geopolitical risks are even higher. I can't think of a year where there are so many wild cards that overhang the market.
The US survived 9-11 by expanding the printing presses at full throttle and going deeper into debt as a country. Since 2001, M3 has grown by $1.5 trillion. It is simply mind-boggling to consider all the permutations and possibilities that exist with so many wild cards hanging over the economy and the markets. With this many what-ifs on the table, it would be by the grace of God and a miracle if none of them are played. I will name the major ones. Any single one of them could throw a forecast way off course. Each one is a major confidence shaker.
War with Iraq and/or North Korea
A major terrorist attack that follows a war with Iraq
A broadening Middle East War
The fall of the House of Saud
Sovereign debt defaults, i.e. Brazil
A spike in energy prices due to terrorism or war
A major default of a money center bank or major US financial institution i.e. Fannie/Freddie
The failure of a major derivative player such as a bank or hedge fund
A spike in credit spreads due to growing bankruptcies
Given all of these uncertainties, where should one invest this year? I believe the "Next Big Thing" is going to be in "things" such as commodities. The big winners in this decade are going to be gold, silver, and energy. Other commodities from sugar, coffee, cocoa and grains, to other soft goods will also be winners. Commodity prices will rise because of two trends: a declining US dollar and rising populations and industrialization of developing economies.
The time for paper is over and the rise of "things" has just begun.
------end excerpt-----
Waverider
(01/19/03; 22:13:02MT - usagold.com msg#: 94978)
Japan appears headed to 0% yields on bonds
http://www.iht.com/articles/83818.html
Snipppit:
"If you think yields on Japan's government bonds cannot go any lower, investors beg to differ. Most are betting that deflation accelerates and yields fall even further toward zero percent. While good news for punters, the trend could cause problems for Japan's economy. A big drop in long-term interest rates could wipe out income gains for financial institutions, which invest primarily in bonds, and leave them and the economy in even worse shape. When investors speculate about financial crisis here, it's a surge in bond yields they fear. Japan's public debt load is nearly 40 percent bigger than the economy. Deflation, which increases the inflation-adjusted value of debt, makes Tokyo's debt load even larger. If investors get antsy about the government's balance sheet, they may drive up rates and slam the economy. But then a plunge in yields could be bad, too. We think a financial system crisis would more likely be the result of an extreme fall in long-term interest rates wiping out income gains for financial institutions, than the more orthodox causal effect of a sudden surge in long-term interest rates," said Takehiro Sato, an economist at Morgan Stanley. With the market expecting deflation to worsen, it's a pretty safe bet that Japanese yields will grind lower this year. Mind you, they don't have very far to go. The benchmark 10-year is yielding 0.88 percent, not too far from the all-time low of 0.73 percent reached in October 1998. The two-year bond is almost at zero percent, yielding 0.06 percent.
Waverider: Meanwhile the Nikkei's not a pretty site tonight - off 2%.
a nation of one
(01/19/03; 22:01:16MT - usagold.com msg#: 94977)
kmart
And they call it 'equity.'
Cytek
(01/19/03; 21:24:16MT - usagold.com msg#: 94976)
BLUE LIGHT SPECIAL
Read in Sunday morning's news that KMART's board is going to vote on dismissing all common shares, over 519 million. That's right folks, everyone that invested in KM over the last few years gets "0", worthless paper. They will issue new stock to secured creditors, banks and bond holders and then emerge out of bankrupcy. The investors who bought and held in their portfolios and IRA's get the big BLUE LIGHT SPECIAL. Hmmm, wonder if those investors will shop at KMART ever again.
TownCrier
(01/19/03; 21:24:02MT - usagold.com msg#: 94975)
Black Blade, here is that Puplava article, a bit closer to home
http://www.usagold.com/gildedopinion/puplava/20030111.html
Excerpt:
It is apparent from the graphs shown above [see article] that the US economic and financial system is headed towards a major train wreck. It is only a question of timing. Nobody in Washington or Wall Street sees it, for they are all either Keynesian or Monetarist or a combination of both. Even the bastion of the bond markets, Pimco, is calling for Keynesian-style stimulus and monetary reflation. Wall Street wants the government and the Fed to use all means at their disposal to ward off a deflationary debt collapse.
Therefore, if the government has to run deficits into eternity and spend wildly, then so be it. If the Fed has to expand credit, monetize assets, intervene in the financial markets by propping up stock prices or peg interest rates, then get on with it. Wall Street has a big stake in keeping its version of financial capitalism alive. The world of structured finance is in danger of imploding and the danger of this implosion has been deemed unacceptable in financial and political circles.
The danger here lies with inflation, instability, volatility, and ultimately, the collapse of the world's present monetary system -- something the world has not seen since the days of John Law. It is apparent that there will be no foot put on the breaks as credit will be supplied in ample quantities to help levitate financial assets of all types...
(see url above)
Cytek
(01/19/03; 21:16:33MT - usagold.com msg#: 94974)
Iraq, U.S. Data Boosts Gold, Hits Stocks
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Financial News
Reuters
Iraq, U.S. Data Boosts Gold, Hits Stocks
Sunday January 19, 10:43 pm ET
By Bill Tarrant
SINGAPORE (Reuters) - Gold hovered near a six-year high on Monday, the dollar struggled and Asian stocks fell after renewed fears about an Iraq war and a spate of poor U.S. economic data cast fresh doubts about a global economic recovery.
Gold was trading around $356.60 an ounce in Hong Kong, little changed from Friday, and was poised to enjoy more volatility in the coming week, with Iraqi news and a weak dollar dictating trends, dealers said. It hit a six-year high of $358.50 on Thursday.
Cytek - with headlines like this the sheaple will soon figure out where the smart money is going. Except the smart ones from this forum have known about this for years. I say keep buying physical , while you still can. I'm with Blackblade on this, stock up on those can goods, stash some extra cash, and even get a backup heating source , like a wood burner. What if a major supply line of Natural gas was cut off for an extended period? Or some crazed terrorist decided to blow up some underground gas storage facility. I would take weeks to replentish the supply while people freeze to death.
Kagalaska
(01/19/03; 21:13:27MT - usagold.com msg#: 94973)
Spot Price -SILVER
Silver looks to be providing leadership tonight.Spot and Spike would seem to be in the neighbors yard, hope they don't get sent home too soon.
Trapper
(01/19/03; 20:59:01MT - usagold.com msg#: 94972)
Sir Rock
After reading your post it came to me that Geo.W. Bush is going to change his name..or have it changed for him. The new name will be much like his fathers name Geo.Herbert Walker Bush. The president's new name will be George W. "Herbert Hoover" Bush. I was not fond of the choices this time but voted for GWB as the lesser of evils choice, I new that the one who got elected was going to get himself "Hoverized". The president of the Titanic I'm afraid..the trap had been set and now it's the Dems who trip the trigger. Too Bad. Because of the ignorance of the voters we will get liberals for the next 20 years again. Man and I really loved this country too. Live small.
Pizz
(01/19/03; 20:42:25MT - usagold.com msg#: 94971)
Inflation argument
http://www.globalstockalert.com/rm.htm
Just stumbled upon this November article. Good read for the pro inflationist. Nothing seems to be happening that would make me think the fundamentals for this analysis are in error.
Pizz
Cytek
(01/19/03; 20:38:08MT - usagold.com msg#: 94970)
Iraq and the Hidden Oil Tax
I am starting to read reports from serious analysts that oil could easily go to $40 or more if a problem develops in Iraq and does not get resolved in Venezuela.
Some say it could rise to $50 in the short term. I think their analysis has some credence. In the long run, oil will come down significantly. But it is the short run that could affect the economy.
Venezuela is the fifth largest producer of oil. Some are beginning to compare the "revolution" there with the overthrow of the shah in Iran. After the shah left, oil production dropped by two-thirds, and is still only 50% of what is was. Revolutions can and will cause serious economic disruption. The proposals by Chavez to re-organize
their oil companies to punish his foes and favor his left-wing cronies are a disaster for oil production. The longer this goes on, the more concerned we should get.
A serious increase in the price of oil acts like a tax increase on the economy. It will slow down not only the US, but the economy of the world. It is a serious drag on world growth. While we will see OPEC and other oil producing countries step up production, filling in for a lost Iraq (if Saddam trashes his oil filed as he leaves)
and a reduced Venezuela will not happen overnight.
All these factors weigh an economy down.
I believe the flat growth in the money supply is probably temporary. There have been such periods before, although not accompanied by a clear softening of consumer spending and debt. I am betting we will get a stimulus package from the federal government sooner rather than later. The probability is that the crisis in Venezuela gets
resolved and Iraqi oil fields are not allowed to be destroyed.
The best outcome for the economy is for Saddam to leave, avoid an expensive war and leave the oil fields intact and even see them allowed to increase production. We need to see a resolution to the crisis in Venezuela. The worst case is that the oil fields get destroyed as Saddam assumes a Samson complex and pulls the walls down with him, while Venezuela deteriorates.
If the worst case Iraq scenario happens, the Fed will find the keys and open the door to the printing press. Just as the stimulus from the last rate cuts made the recession far less severe than it could have been, the Fed will attempt to forestall or lessen the next one.
But the damage will have been done, and the stock market will not act kindly. John Mauldin.
Black Blade
(01/19/03; 20:27:56MT - usagold.com msg#: 94969)
Oracles, Soothsayers & Fortune Tellers
http://www.financialsense.com/stormwatch/update.htm
Watching The Debt Levels
Snippit:
There is also the enormous debt burden on consumers and corporations that still overhangs on the economy and the markets. Companies will need to rebuild their balance sheets. Consumers are now in the process of rebuilding savings as job prospects look grim and debt levels crimp the monthly budget. State and municipal budgets are also in a crisis mode especially in California and New York. In California, the governor has just proposed a massive $8.3 billion tax increase. States will be raising taxes this year, which will trim more money from consumers take-home pay. States are raising everything from income taxes, property taxes, sales taxes and sin taxes to raising fees on services. Higher state tax burdens will offset many of the gains coming from the President's proposed tax cuts.
Because of rising debt issues, increased state taxes and a continued weak job market, I believe we will see the consumer retrench even more this year. If that happens, what remains on the horizon to act as a stimulus for the economy this year? The mortgage, real estate, and consumption bubbles literally rescued the economy after 9-11. What takes their place? It has to be either government fiscal spending or business capital investment. As discussed earlier, I don't see capital spending improving until business profitability is restored, balance sheets repaired and pricing power returns to the business marketplace. I just don't see that happening this year. If profitability improves, it will come only from cost cutting, which from a macro sense, reduces economic growth. Higher profitability and prosperity aren't consistent with general cost cutting.
Therefore, I believe that there is a high probability that this year could become the first time since the Great Depression that the stock market experiences four back-to back years of consecutive losses. There are simply too many unknowns out there with geopolitical risks and increasing credit default risks at the government, corporate and consumer levels.
Black Blade: Another good read by Puplava. He gives his outlook for the economy for 2003.
a nation of one
(01/19/03; 20:26:51MT - usagold.com msg#: 94968)
once upon a time
In Ancient Athens, during the plague in which Pericles died, when everyone else was also dying, even the staunchest and most highly respected traditions of greek culture were completely abandoned. People became animals again. They did everything imaginable to survive. Civilization completely disolved.
ElGordo
(01/19/03; 20:08:56MT - usagold.com msg#: 94967)
uh oh...what else is there?
BAGHDAD, Iraq - Top U.N. officials said Baghdad disclosed it found four more empty chemical warheads like a dozen others discovered last week, and said there had been "some progress" Sunday in talks to win greater Iraqi cooperation with arms inspectors.
__________________
Big Bang is Bogus, I'm for the new "steady state" theory, world
without end amen. Its always been here, infinity has no beginning
or end. Cheers
Black Blade
(01/19/03; 19:46:35MT - usagold.com msg#: 94966)
Company Forecasts Expected to Be Dim
http://www.reuters.com/financeNewsArticle.jhtml?type=businessNews&storyID=2070080
Snippit:
NEW YORK (Reuters) - Investors are bracing for a tidal wave of profit forecasts from U.S. companies this week, and there is a growing belief the flood will bring more bad news. As fourth-quarter results roll in, investment professionals will mostly skip over last year's earnings tallies and go straight for forecasts. After disappointing projections from companies, including software maker Microsoft Corp., Wall Street isn't anticipating much good news. "People have a pretty good sense of what happened in 2002, so they're looking to see how 2003 and even 2004 will shape up," said Peter Gottlieb, portfolio manager for First Albany Asset Management. "The big fear on Wall Street is that the mild, tenuous recovery we've had is going to dissipate. I think guidance will be muted."
Black Blade: We are witness to a major economic decline and a secular bear market. Few living today have ever seen such an economic collapse. The most many have seen is the stagflationary 1970's, but whet we are seeing now is just the beginning of an economic nightmare not seen since the 1930's. It's going to get very ugly and those who have not taken personal responsibility for their economic survival are going to suffer greatly. Not that I feel any sympathy for them but it's going to be an "interesting" study in human behavior. The weaklings will point and blame others for their predicament. It will be the ultimate "ant and grasshopper" fable in living color. Government, corporations and consumers are drowning in debt. Even with rising debt they were spending like drunken sailors all the while taking on even more debt. This is unsustainable. We are about to see the fourth year of a major bear market and another the following year. Our rulers will panic (state politicians already are panicking – take California's Grey Davis for example), corporate leaders will panic (you think you saw a lot of perp walks last year?), and of course consumers will go completely ape s*&$! With rising energy costs that will continue to rise no matter the outcome of the Iraqi situation and even a possible resolution of the Venezuelan strikes (though a civil war is a very real possibility). In the meantime we can observe the continuation of this week's "confession season" as corporations meet or beat vastly lowered analysts expectations. As always get out of debt and stay out of debt, stash enough emergency cash for several months’ expenses, accumulate Gold and Silver portfolio insurance, and start (actually add to) a storage program of nonperishable food and basic necessities. It looks to get very ugly.
Black Blade
(01/19/03; 19:30:08MT - usagold.com msg#: 94965)
Re: Rock - Big Bang or Big Dud?
Rather than get into a complex discussion of the "Big Bang" theory and discussing the mathematical basis for a rapid inflation of matter expanding outward from a point source or singularity and the observation of the Doppler effect and redshift, etc. The theory has explained the existence of observable phenomena but still leaves open a lot of questions. This also has left open the question of whether the universe will continue to expand, remain static, or collapse. The big bang model of the universe, originally suggested over 60 years ago, has been developed to explain a wide range of observations about the cosmos. A major element of the current model, added in the 1980s, is the theory of "inflation," a period of hyperfast expansion that occurred within the first second after the big bang.
A new theory of the universe proposed by Princeton physicist Paul Steinhardt and Neil Turok of Cambridge University suggests that space and time may not have begun in a big bang, but may have always existed in an endless cycle of expansion and rebirth. The theory proposes that, in each cycle, the universe refills with hot, dense matter and radiation, which begins a period of expansion and cooling like the one of the standard big bang picture. After 14 billion years, the expansion of the universe accelerates, as astronomers have recently observed. After trillions of years, the matter and radiation are almost completely dissipated and the expansion stalls. An energy field that pervades the universe then creates new matter and radiation, which restarts the cycle. The new theory provides possible answers to several longstanding problems with the big bang model, which has dominated the field of cosmology for decades. It addresses, for example, the nagging question of what might have triggered or come "before" the beginning of time.
What's fun about these theories is that as more information is collected they can be fine tuned or altered fit the data. Of course none of these theories are ever likely to be proven and of course more theories are likely to emerge. What we can say is that the universe exists. The question about the universe is: was there a beginning or is it infinite. For researchers this is the Holy Grail. I guess we could say that all matter was formed in some cataclysmic event(s) and that makes us "star children" in a sense. No matter how you look at it, it is a fascinating subject.
- Black Blade
a nation of one
(01/19/03; 19:18:18MT - usagold.com msg#: 94964)
pog
http://quotes.ino.com/chart/?s=FOREX_XAUUSDO&v=dmax&w=1&t=l&a=200
Exactly what kind of a doubt is there, about what is happening to the dollar value of gold?
a nation of one
(01/19/03; 19:15:50MT - usagold.com msg#: 94963)
DOW
http://quotes.ino.com/chart/?s=INDEX_INDU&v=dmax&w=1&t=l&a=200
Is there any real question about where the DOW is ultimately headed?
a nation of one
(01/19/03; 19:13:24MT - usagold.com msg#: 94962)
$
http://quotes.ino.com/chart/?s=NYBOT_DXY0&v=dmax
Can there be any question that soon it is going to take even more dollars to buy and ounce of gold?
a nation of one
(01/19/03; 19:07:48MT - usagold.com msg#: 94961)
@ Trojan (1/19/03; 15:13:44MT - usagold.com msg#: 94958)
Thanks. I have placed the link into a file which I refer to often.
By no means do I propose that the dow will not go down. Indeed I think it will. But how? And when? And why?
What your man is doing is pretty much the same as what I was doing. His reasoning is more profuse. And its detail is richer. He and I were both thinking about the same past events in similar ways, and each of us reached some conclusions, which, I don't have to add, seem completely different. I would say, however, and it is true, that my comments were about the possibility of a rising DOW because, with regard to the possibility of a declining DOW, no comments were needed. My motivation was to prevent discouragement among readers of this forum, not to firmly predict whatever I might happen to think is going to occur.
a nation of one
(01/19/03; 18:39:24MT - usagold.com msg#: 94960)
@EagleOne (1/19/03; 13:54:39MT - usagold.com msg#: 94956)
You ask: "How long have you been at this...actually putting money into gold or equities?"
--I bought my first shares before men first walked upon the moon.
a nation of one
(01/19/03; 18:32:10MT - usagold.com msg#: 94959)
@ Rock (1/19/03; 12:52:09MT - usagold.com msg#: 94952)
I respect your view, but I do not agree with it.
Trojan
(1/19/03; 15:13:44MT - usagold.com msg#: 94958)
@ a nation of one Re: Your # 94936
http://www.zealllc.com/2003/autopsy2.htm
Your comments about the next Stock Market event are interesting.
For everyone reading this and a nation of one, in the link above Adam Hamilton has just wrote a BRILLIANT article as he usually does. He has taken the last three Bear Market Rallies. (Greenspan's cutting of Rates) (9/11 Aftermat Rally) (October Rally) and converted them to a index of 100 and then produced graphs on the three of them together. The picture it paints is quite fascinating.
Adam Hamilton is one of my favorite Analyst's in that he combines Knowledge, with a unique and inovative way of seeing things.
Have a look.
His Verdict "The Rally Is Soon Over" RIP :-)
GoldCoaster
(1/19/03; 14:25:18MT - usagold.com msg#: 94957)
@ Rock
Hi Rock,a little earlier on you said:"I can count on the sun rising in the East and setting in the West every day. That's not an illusion because when two individuals observe the same thing its called truth."
I always thought that the sun is "stationary" and that the rotation of the earth makes the Sun "appear" to rise and set.Many individuals cant see that but it is still the truth.
EagleOne
(1/19/03; 13:54:39MT - usagold.com msg#: 94956)
a nation of one
How long have you been at this...actually putting money into gold or equities?
Old Yeller
(1/19/03; 13:41:38MT - usagold.com msg#: 94955)
The commercials
Are backed by the government,until it's no longer politically expedient to do so.
"Governments exist to maintain order.To achieve that,
governments are quite willing to allow the
few to suffer'so that the many will carry on contentedly.
If ever a government is presented with the choice between
either preserving domestic paper gold or domestic fiat
currency,but not both,there will be no choice at all.
Millions of registered voters must,at all costs,be kept
content.Indeed ,the comparatively few who suffer in the
forsaken markets will be portrayed by the government as
having gotten their just desserts.They will be described
as get-rich-quick gluttons for whom the hard working
citizenry need devote no sympathy.This is classic
Machivelli,and it will work next time as it has worked
countless times in the past."
Holtzman,USAGOLD.
Sometimes it's not the Hunt's or the speculative longs
in TOCOM palladium that get the shaft.It all depends on
the size of the problem and the policy solution arrived
at to protect the real perpetrators of the scheme.
The government.
Arcticfox
(1/19/03; 13:04:21MT - usagold.com msg#: 94954)
Great site to keep an eye on....
http://www.publicdebt.treas.gov/opd/opdpenny.htm
..
ElGordo
(1/19/03; 12:58:10MT - usagold.com msg#: 94953)
Weaker Dollar = Inflation?
http://cbs.marketwatch.com/news/story.asp?guid=%7BA03B8C6E%2DCD4B%2D4439%2D80FE%2D3FB549DE75D5%7D&siteid=mktw
LOS ANGELES (CBS.MW) -- Higher prices could be on the horizon for consumers -- affecting everything from cars to apparel and consumer electronics -- if the dollar continues its plunge.
"If you want French wine, you'll have to pay more. If you want to travel to Europe this summer, you're going to pay more," said David Gilmore, a partner at Foreign Exchange Analytics, a currency advisory firm. "Consumers can be somewhat at a disadvantage."
Since early 2002, the dollar has lost 12 percent of its value against a basket of currencies, with half of the decline coming in the last three months, according to J.P. Morgan. Mounting concerns about a war with Iraq led to the most recent slide, strategists say.
"It's very clearly related to war risk," said Larry Kantor, J.P. Morgan's global currency strategist.
The dollar's biggest drop has been against the euro, falling almost 6 percent against the currency since reaching parity in mid-November. The euro recently traded for $1.0653. The dollar also lost ground against the Japanese yen and several other Asian currencies.
"Imports will cost more," said Sung Won Sohn, chief economist at Wells Fargo. Also, "A falling dollar discourages foreign investment in the U.S., so stock and bond prices are less likely to rise."
Rock
(1/19/03; 12:52:09MT - usagold.com msg#: 94952)
Re: A nation of one
Your comment regarding my comment, you said, "It isn't that the universe is of law and order and perfect design, but that we human beings have figured out a way of explaining it that makes it seem that way."
I disagree, just because the laws of math and science may confirm what our eyes already observe doesn't change the truth of the fact that we live in a Universe of perfect law and order.
Even an uneducated individual on a dark clear night where there is no light pollution could look up at the sky and see the design of stars that out line a perfect tapestry of beauty and perfection. Just looking up at the moon and stars and sun and other planets in our solar system and observing the changing of the seasons year after year from the beginning of when God created time.
I can count on the sun rising in the East and setting in the West every day. That's not an illusion because when two individuals observe the same thing its called truth. Nah, I dont need scientific verification to explain why I believe the way I do rather scientific analysis and mathematics support it. Good intelligence always supports truth.
Cheers,
Rock
ElGordo
(1/19/03; 12:51:54MT - usagold.com msg#: 94951)
Selling Dollars
http://quote.bloomberg.com/fgcgi.cgi?ptitle=Top%20Financial%20News&s1=blk&tp=ad_topright_topfin&T=markets_box.ht&s2=ad_right1_topfin&bt=ad_position1_topfin&box=ad_box_all&tag=financial&middle=ad_frame2_topfin&s=APirLqxXcVS5TLiBE
Tokyo, Jan. 20 (Bloomberg) -- Slowing economic growth, a widening trade deficit and a potential war with Iraq may send the U.S. dollar lower against major world currencies for a seventh week in eight, said a majority of 30 strategists surveyed by Bloomberg News.
The strategists recommended selling the dollar against the euro, yen, Swiss franc, British pound and Australian dollar after government and industry data last week showed the U.S. economy may not be growing as fast as expected.
``People are selling dollars and buying everything else,'' said Andrew Feltus, who may add euro-denominated bonds to the $100 billion he helps manage at Pioneer Investment Management in Boston. The U.S. Federal Reserve has cut rates to a four-decade low, ``yet growth is still disappointing,'' he said.
ElGordo
(1/19/03; 12:36:23MT - usagold.com msg#: 94950)
@Sector
I first came across the Debka site about 3 years ago.
It is completely bogus.
Don't take my comments personally, I'm just saying
from my experience, don't bother reading anything
from Debka, its pure nonsense.
Rock
(1/19/03; 12:35:49MT - usagold.com msg#: 94949)
Re: A nation of one "my earnings"
You speak from a vantage of wisdom.
R Powell
(1/19/03; 12:29:44MT - usagold.com msg#: 94948)
Delivery from Comex
Aristotle, let me start by reaffirming your vote of confidence for Michael's company. I, too have purchased from CPM and found the service excellent. It was for me also a chance to talk with Mr. Cooper.
I got the impression from your last post that it is your opinion that Buffett bought silver from Comex supplies without ever buying any contracts. This possibility had never occured to me. Why then was there a suit filed against Philbro (Buffett's broker) alleging market manipulation? To use your analogy, the lumberyard owner will not file suit against a buyer of lumber no matter how large the order. Actually, I prefer dealing directly with small sawmill owners. Buffett had 89 million ounces at the time this was filed. Whether he ever got the physical metal or just paper promises for the last 40 million is questionable. Have you any insight here? Also, why a lawsuit? The suit alleged market price manipulation. The price mechanism is the Comex market, not the bullion banks.
That most of Comex trading is settled in cash is also not in question, in fact a guess of 98% of paper contracts being settled on account statements would probably be a fairly close guess. Of that which actually does change ownership, again probably most new owners store in Comex so that physical delivery is again not an issue. But, delivery is possible. Indeed, Sinclair has made an appeal to big money players to do exactly this- take delivery.
My original question was why Mr. McEwen choose to buy from the bullion banks? What other sources are available? Could he not buy directly from other miners or, if he wanted to test only the bullion bank market, why not stand for delivery on a contract as Sinclair has suggested? Why choose to buy directly from bullion banks rather than gain publicity through Comex?
I also want to make clear that I believe the price of both gold and especially silver will go much higher due to the multitude of reasons discussed here daily, but even if all these were to fail, greater demand than production in the physical arena will eventually prevail. This is the one fact that can not be hidden, manipulated, covered over etc no matter how the markets are operated or managed.
I'm also still interested in how much newly mined gold travels directly from producer to user without any Comex or bullion bank contact?
I had originally asked these questions in response to a posting from yesterday by M.K. but I hope anyone interested will feel free to jump in.
Rich
a nation of one
(1/19/03; 12:19:56MT - usagold.com msg#: 94947)
(No Subject)
If you sell on highs to make a profit, and the price goes up, not only do you miss out on the difference, but you also pay fees and commissions, both to sell and to buy back in again. True, there is cash in your account that wasn't there before, but your account's net worth is less. This means that you are less well covered on the downside. Sit down and make yourself figure this out with a pencil and a sheet of paper. That old saying, "It never hurts to take a profit," is not true. It is only consistently good for the broker, not for the investor.
TownCrier
(1/19/03; 12:11:20MT - usagold.com msg#: 94946)
Houston, you will find an avenue to answer your FDR confiscation question here
http://www.usagold.com/cpm/hoppe.html
At the link above, you will find some historical info that may be of use to you.
If you scroll all the way to the bottom of the page you will find info about the in-depth client memorandum assembled by George Cooper and Michael Kosares, about which they say, "This memorandum provides to our knowledge the most detailed and comprehensive documentation on the subject of gold confiscation in the United States assembled to date."
Enjoy your research, you have come to the right place.
R.
a nation of one
(1/19/03; 12:08:38MT - usagold.com msg#: 94945)
i'm not crying
14% over 8 months = 21% annually.
a nation of one
(1/19/03; 12:05:45MT - usagold.com msg#: 94944)
my earnings
My own earnings in gold for the past eight months have come to 14%. I know that a lot of people have done better. But I will be very glad to make that in any year. It takes almost none of my time, and is not stressful. I don't have to sweat when to sell, or how much I will lose if I take a profit and the price goes higher. I don't make a job out of it. I just want to benefit from the trend I can see occurring. For me, that's what I want. I stay in. This makes me a strong hand. My health is more important than money. I would have made significantly more, but three times I followed my broker's advice. He was wrong each time. Badly. And I knew this, because, when I first met him, he made five predictions, and he was wrong about all of them. He is not an exception among brokers, neither good nor bad. Most of them are like that. I have had the same experience consistently over many years, with numerous brokers. They all make big mistakes and want you to pay for them. In my experience there have been no exceptions to this. What makes it difficult is that I am not perfect myself, and this is true of most people. I have been right in my predictions more often than my broker, however, because I am more intelligent than he is, which is also usually the case with me, since my intelligence is above average. My smartest actions, however, more often than not, except when I bought in to begin with, have been when I did nothing.
a nation of one
(1/19/03; 11:43:37MT - usagold.com msg#: 94943)
correction
My statment: 'Don't forget to get, of course, before it goes down permanently.'
--Should read, "Don't forget to get out, of course, before it goes down permanently."
USAGOLD / Centennial Precious Metals, Inc.
(1/19/03; 11:40:26MT - usagold.com msg#: 94942)
In bookstores it retails for $14.95. But you know the author! Get it here for $5.95
http://www.usagold.com/cpm/abcs.html
"Without waxing philosophical, a few words are helpful concerning the mind-set with which you pursue your interest in gold ownership. Some enter the gold market to make a profit, others to hedge disaster, some to accomplish both. No matter into which category you fit, make sure you understand why you are going into the gold market. Convey that understanding to the individual with whom you are structuring your gold portfolio. The whys have quite a bit to do with what you end up owning.
"Frequently investors will say that any kind of gold will do because after all gold is gold, isn't it? This type of attitude has helped a great many coin shop owners unload unwanted inventory they hadn't been able to get rid of for years. This is probably a good deal for the coin dealer, but it could spell disaster for you. In the same vein, I have talked to hundreds, probably thousands, of investors in nearly a quarter century in the business. Quite often, potential investors have no more reason for buying gold than 'everybody else is doing it.'
"In Chapter 16 on portfolio planning, you will find some details on this important subject. For now, consider the inscription over the entrance to the temple of the ancient Delphic Oracle: 'Know Thyself.' Study. Read. Learn what's going on around you. Call a few gold firms and ask questions. There's nothing like conversation to stimulate thinking. Take time to lay a little groundwork. Then make your move. The political and economic situation being what it is, there is no better time to start than now. Know thyself -- your goals and needs -- and you will be a more confident, happier gold investor." (more)
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