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ARCHIVED DISCUSSION FROM 6/20/2000
All times are U.S. Mountain Time
(Yesterday's Discussion.)
elevator guy
(06/20/00; 23:19:49MT - usagold.com msg#: 32666)
Chumps like me
I turned $5000 into $65,000, by buying paper gold. Someone got on the wrong side of that bet, but its about time the longs had a bone tossed to them.
Maybe in the long run, anyone left holding paper will be a "chump".
But I would prefer to call them un-informed, or risk takers. To disparage the choices of others amounts to intellectual snobbery, unbecoming a champion of the cause of physical gold.
How bad do things have to get before we are biting each other to the bone, in a frenzy of hatred?
I could have bought $5000 worth of physical gold, and now I would have $5000.
The FOA/Another scenario may yet come to pass, but dont hold your breath. You may turn blue before TPTB run out of bullets. Gold is for holding wealth, not making it. And even if gold goes to $30,000 an ounce, it is only measured in little dollars, and that will only buy you a $30,000 suit.
SHIFTY
(06/20/00; 22:40:20MT - usagold.com msg#: 32665)
Goldfields Ltd/ Franco Nevada
I need help understanding this deal. I own Goldfields Ltd. and I saw a letter on their web-site this morning (cant find it tonight) it said that holders of Goldfields would receive 35 shares of Franco Nevada for every 100 shares of Goldfields. Franco Nevada sells for about $12.00 US. My Question is do I add the value of the Franco Nevada shares to what I hold in Goldfields Ltd, or do I get the 35 shares of Franco Nevada and forfeit my Goldfields Ltd. ?
Lets say 100 shares of Goldfields at a price of $4.00 = $400.00
Lets say 35 shares of Franco Nevada at a price of $12.00 = $420.00
For every 100 Goldfields I own will I get $420 or the combined$820 To then be divided into the new Goldfilds International shares at what ever price it is set at.?
I don't know if I made money on the deal or is the value of what I hold about the same?
Any help would be appreciated.
Dr. Jones
(06/20/00; 21:16:27MT - usagold.com msg#: 32664)
HI - HAT msg. 32655, White Hills msg. 32661... Indexing
The two of you make an interesting point about indexing. It got me thinking about the economic motives for fudging the CPI, aside from the obvious boon to the stock market and the dollar.
White Hills, you jogged my occasionally suspect memory regarding the appointment of Mr. Rubin in the Treasury. Wasn't Mr. Rubin the brainchild behind the refinancing of debt from long term treasury instruments to shorter term instruments early in the Clinton administration?
I believe the strategy was to replace 30 year bonds at high but predictable rates with 10 year bonds at rates more reflective of the short term CPI... the next administration would have to deal with the dilemma of rolling over the 10 year instruments at prevailing rates a decade later (i.e., after the CPI time bomb exploded).
Is my memory - and reasoning - correct on this?
dj
Leigh
(06/20/00; 20:42:14MT - usagold.com msg#: 32663)
Hill Billy Mitchell
Does "their gold shall be removed" mean CONFISCATION?
Hill Billy Mitchell
(06/20/00; 20:38:41MT - usagold.com msg#: 32662)
Gold no longer being money and never will be again????
@Golden Hook(06/20/00; 18:45:59MT - usagold.com msg#: 32658)
IMO, there is no such as IMHO. Defining one's position by the qualification IHMO would be rather like my telling you about the book I wrote, "Humility and How I Attained it." (just a little fun) No offence intended.
I do disagree with your conclusion concerning the desirability of gold and silver. My reason is based upon what I read in the Bible.
Ezekiel 7:19 "They shall cast their silver in the streets, and their gold shall be removed; their silver and their gold shall not be able to deliver them in the day of the wrath of the LORD."--up until the "day of the LORD'S wrath, gold and silver will be highly valuable and will deliver people from the authorities, so to speak.
Isaiah 2:20 "In that day a man shall cast his idols of silver, and his idols of gold, which they make each one for himself to worship, to the moles and to the bats"--same context.
Ezekiel 28:4 "With thy wisdom and with thine understanding thou has gotten thee riches, and hast gotten gold and silver in to thy treasures"--Most theologians contend that this is a refers to the "Anti-christ", and describes how he will take control of the world money system by building up huge reserves of gold and silver.
I am sure that this, being based, not on current or past facts, but rather on prophecy would be regarded as rather silly by many; however foolish it may sound to some, I base my whole position for holding the physical on the above Bible references as I assume that we are living in the end of the age and that I will participate in the "blessed hope", the rapture of the church from this world scene, prior to the "Day of the Lord's wrath. I also lean towards a pre-wrath rapture some time after the "Great Tribulation" commences but prior to the unleashing of the "Wrath of the LORD", and for this reason expect to be around when the "Beast" has accumulated much of the worlds gold reserves. If this interpretation is correct then it could be mighty nice to have some gold in hand when it becomes so valuable.
Don't laugh, many hold gold simply because they have a hunch..
I do not deny that without the "spiritual" reasons, I would likely be a gold bug in any event. Too much fun in being one as opposed to being a paper bug in debt up to my ears. Tried both and prefer the physical stuff.
HBM
White Hills
(06/20/00; 20:03:29MT - usagold.com msg#: 32661)
Indexing
Hi-Hat Msg #32655, Bingo right on the money, cooking the books to make the CPI smaller than it really was started right at the beginings of the Clinton Adm. that is why I believe that Lloyd Benson resigned and Rubin took over Treasury. I wonder what the senior citizens would say if they knew how much COLA they really missed out on not to mention all of the other groups that receive COLA the last eight years. White Hills
Leland
(06/20/00; 19:11:00MT - usagold.com msg#: 32660)
The Photography is Great...Please Excuse the bad Link...
http://www.dailypress.com/news/update/stories/opsail.htm
.
Leland
(06/20/00; 19:08:20MT - usagold.com msg#: 32659)
BEAUTIFUL!
http://www.dailypress.com/neews/update/stories/opsail.htm
Parade
of Sail
departs
The tall ships of
OpSail 2000
weighed anchor
in Norfolk's
Elizabeth River
this morning,
leaving Hampton
Roads for
Baltimore.
Right: The
Larinda, a replica
of a 1767 Boston
Schooner, joins
the line of ships
leaving the docks near Town Point Park.
Below: Sailors aboard the U.S. Coast Guard's Eagle watch as
a man in a motorized parasail craft flies near their masts.
Bottom: The Eagle flies the American flag as it joins the
departing Parade of Sail.
Photos by Adrin Snider/Daily Press
OpSail captains bid Hampton a fond farewell
(Click for More)
Golden Hook
(06/20/00; 18:45:59MT - usagold.com msg#: 32658)
GOLD IS NO LONGER MONEY & NEVER WILL BE AGAION:
GOLD-GOLD- Does not stir up the jucies as it did at one time. Just to mention gold was to send a stampede of people that would trample one to death for a chance to be in a place where gold was around.
Today, This is not so, We have a couple of generations of brainwashed sheeple that knows only paper nad plastic. Some would not have gold in their savings, Because it is not stocks or notes, or dollars.
I am a goldbug from way back before some on this forum became Gbugs. Many today make somewhat of a living trying to get the sheeple to ounce again think "GOLD". It will never happen, and if it was so, gold would be at a price even the rich would think twice about purchasin another ounce.
The world is on a course to destruction of all its finicial systems world wide. Gold is at 285. to 295. an ounce.
People want paper and monthly welfare checks, not gold.
The day of collecting gold is for retirement as money is gone .
one is better off educationing and appling the method to the sheeple that pennies are in short supply more so then gold.
I will not sell what I have. Neither will ever buy another ounce of gold or mining stocks. This is my opinion for some time.
IMHO
Hill Billy Mitchell
(06/20/00; 18:04:42MT - usagold.com msg#: 32657)
Official release
http://www.bog.frb.fed.us/releases/H15/update/
Official: Federal Reserve Statistical Release
Release Date: June 20, 2000
Rates for Friday, June 19, 2000
Federal funds 6.51
Treasury constant maturities:
3-month 5.84
10-year 6.00
20-year 6.24
30-year 5.89
upside-down spread FF vs long bond = (.62%)
SHIFTY
(06/20/00; 17:15:01MT - usagold.com msg#: 32656)
NY Ponzi
Nasdaq 4013.36 + Dow 10,435.16 + 14,448.49 divide by 2 = 7,224.24 Ponzi
down 49.60 ponzi points
HI - HAT
(06/20/00; 16:57:04MT - usagold.com msg#: 32655)
Dr. Jones msg...32654............Indexing
What Hamilton says about CPI manipulation, and US dollar value, was the point I was making in a post a couple of days ago about indexing.
I would judge a large reason for CPI manipulation is to ward off the many COLA adjustments, as well as keep the bubble floating.
Also, until talk of indexing is way more widespread and is actualy in use, will we have to fear inflation going - hyper.
Dr. Jones
(06/20/00; 16:24:16MT - usagold.com msg#: 32654)
"Lies, Damn Lies, and CPI"
http://www.gold-eagle.com/gold_digest_00/hamilton061900.html
Interesting reading from Adam Hamilton... BLS manipulation of CPI, correlation of CPI to M3 growth, currency debasement, and the role of Gold in hyperinflation.
For those just browsing, here's his conclusion:
"As this month's BLS results made crystal clear, the CPI is not a valid measure of inflation, but has devolved into a mathematical Frankenstein's monster. Real inflation, by any measure, is much higher than official Labor Department statistics indicate. Sooner or later, general price levels will rise high enough so everyone will be able to see through the statistical smoke and mirrors the BLS has deployed. When that day comes, international faith in the US dollar will plummet like a meteor, and hundreds of billions of dollars will be dumped in the international currency markets in nanoseconds. The only investment that has always thrived in highly inflationary environments in the past is gold. Gold always retains its inherent, intrinsic value through all financial turbulence, and shines its brightest when the demons released from the Pandora's Box of inflation are wreaking the most havoc."
Aristotle, any thoughts?
dj
R Powell
(06/20/00; 16:05:58MT - usagold.com msg#: 32653)
Government power, Jimmy Rogers and a healthy supply
Mr.MarkeTalk
Thanks for your thoughts on my wonderings of yesterday. I still wonder how much power (money) the government has to support a market that wants to go down? Can they deflate it slowly or will they "loose" it.
I too miss Jimmy Rodgers' commentary but I think he's still on a round the world tour. Read some of his articles from different countries in "Worth" but as his were the only articles worth reading, I let my subscription expire.
It's reassuring to know the sheeple can still be counted on to push POG higher as it rises to real market value and even after that point. I believe the elements are in place for much higher dollar terms for gold but someone or something needs to get the wagon rolling. I hope you're well stocked with merchandize for when your business goes ballistic. I also hope it's soon!
TownCrier
(06/20/00; 15:27:52MT - usagold.com msg#: 32652)
An update to The Week in Gold--the weekly market report courtesy of the WGC
http://www.usagold.com/wgc.html
This excerpt from this week's report on the ongoing deregulation of the Chinese gold market is just the sort of thing that gets too little attention with regard to its potential impact on the world gold market. Degregulation expected within a year? Hmmmmmm...looks like they are making better progress on that than we had anticipated here in The Tower.
"Investec, the South African investment bank, has signed an agreement to provide the People's Bank of China (PBOC) with a consignment stock of approximately one tonne of gold every three weeks. The agreement, which is for an unlimited period of time, will provide for Investec shipping a minimum 15 tonnes of gold to China each year. China produces about 150 tonnes of gold a year but consumes about 200 tonnes, making it a net importer. All buying and allocation of gold in China is controlled by the PBOC, China's central bank. The Chinese gold market is highly regulated, but with the silver market being deregulated earlier this year it is thought to be only a matter of time before the gold market is liberalised. Raymond Chan, outgoing chairman of the Chinese Gold and Silver Exchange Society in Hong Kong, was quoted last week as saying: "I expect (deregulation) at the latest will be by next June or the latter half of next year." "
Leland
(6/20/2000; 14:04:05MT - usagold.com msg#: 32651)
Just Something to Think About...And I Think About my Grandchildren a lot...
http://www.ardemgaz.com/today/edi/
.
Hard assets...Easy access
(06/20/00; 11:15:46MT - usagold.com msg#: 32650)
Centennial Precious Metals, Inc.
http://www.usagold.com/onlinestore/special.html
This Uruguayan 5 peso coin offer has been a been a remarkable success even as we predicted it would be. If you haven't yet looked into these coins, check out the link given above. In light of the low mintage, such that the entire world supply of these Uruguayan gold coins could be stored within 10 normal shoeboxes, it is uncertain whether Centennial may be able to bring you this particular offer again. So if you are considering adding a few of these to your collection/portfolio you will want to make your final decision soon. Only a couple hundred still remain from the original small cache.
Let Centennial assist you will all of your precious metals needs. It is your decision to do business with Centennial that makes this website possible. Thanks for your support--past, present, and future.
USAGOLD
(06/20/00; 10:52:04MT - usagold.com msg#: 32649)
Correction
Today's Daily Report should read that I've doing the Daily Market Report for almost FOUR years, not FIVE. Marie clued me in when I got to the office this morning.
TownCrier
(06/20/00; 10:13:17MT - usagold.com msg#: 32648)
U.S. INTERNATIONAL TRADE IN GOODS AND SERVICES--April 2000
The April trade deficit falls by $0.2 billion from March as exports remained unchanged but the dollar value of imports was down by $0.2 billion thanks to April's brief decline in crude prices to $24.42 per barrel (down from $26.38 in March) following nine months of rises. So basically, you now know where we are headed with the trade reports on the next couple of months...higher trade deficits. With the April deficit running at $30.4 billion, we are on pace for an annual rate of $350 billion, far beyond last year's record $265 billion deficit.
America's trae deficit with Japan hit an all-time record of $7.3 billion (up 7.4 percent from March), our gap with China widened 14.7 percent to $5.8 billion, and our deficit with our largest trading partner, Canada, reached its second-highest level ever at $3.9 billion.
From seasonally adjusted figures, exports of nonmonetary gold in April returned to levels closer to their historic norm from the recent six-month span of lofty shipments. In April, U.S. gold exports were approximately 27 tonnes, down from 74 tonnes in March.
Year-to-date figures for 2000 reveal that $2.679 billion in gold has been exported, whereas during this same time last year only $1.029 billion had been sent abroad.
U.S. imports of nonmonetary gold were down to approx. 20 tonnes in April from 42 tonnes in March. (Tonnage approximations based on $10 per gram.) Year-to-date U.S. gold imports for this year are running at $1.057 billion imported, slightly greater than last year's comparable figure of $1.036 billion.
A summary of nonmonetary gold export and import values NOT seasonally adjusted are as follows ($ million)
$269 Export . . . April . . . $198 Import
$709 Export . . . March . . . $423 Import
_____________Cumulative year-to-date___________
$2,615 Export . . . yr 2000 . . . $1,056 Import
$1,026 Export . . . yr 1999 . . . $1,034 Import
Statistical note: because U.S. Census Bureau data includes only gold that passes through the customs territory, the Commerce Department's Bureau of Economic Analysis adjusts these gold figures to arrive at more suitable accounting for balance of payments to reflect static changes in ownership. To that end, exports are adjusted for gold that is purchased by foreign official agencies from U.S. dealers and held at the Federal Reserve Bank of New York, and similarly, import figures are adjusted to reflect gold sold by such foreign agencies from their stock held at the FRB of NY.
USAGOLD
(06/20/00; 10:09:58MT - usagold.com msg#: 32647)
Today's Gold Market Report
6/20/00 Indications
Current
Change
Gold August Comex
288.30
+0.30
Silver July Comex
5.05
+0.01
30 Yr TBond Sept CBOT
97~13
-0~10
Dollar Index June NYBOT
106.25
+0.26
Running Commentary (The Short & Sweet of It: 6/19/00): Believe it or not, we've been at this
Daily Report desk for nearly five years. Thought it about time to change the pace a little and write a
running commentary column once a week (should the spirit move) modeled after our very popular
Short & Sweet presentation in our monthly newsletter -- News & Views. . . . . . . .This will
give me a chance to comment, criticize, vent, applaud, explain and distract on a wide range of
economic, political, financial and social topics for the benefit of anyone who cares to listen. Don't
expect the scholarly here. This will be done in a bullet format -- for better or worse. Maybe we can
call it Tuesday's with the Gold Broker, (or did somebody already do that??) Here we go. . . . . . .
. . . . . What's wrong with this picture? Reuters reports this morning that "the U.S. trade deficit
narrowed to $30.44 billion in April from a revised $30.15 billion record high in March." Let me
see. Which is the bigger number 30.44 or 30.15? Which month comes first March or April. To
say that our esteemed governance has trouble with numbers would be an understatement. Now
that the Supreme Court has banned prayer before football games perhaps they could institute it
before the government releases an economic report. . . . . . . . .Along these lines, John Crudele's
article on government inflation reports is an eye-opener. The bogus CPI reports make the Clinton
administration look good in an election year, but they make Greenspan and the Fed look awfully
bad. Greenspan appears to be flailing at phantoms in the night when he starts talking about
looming inflation etc. Says Crudele: "These tricks, of course, are directed specifically at the
Federal Reserve and the financial markets. The object: to stop further interest rate increases." The
problem with this situation is that Greenspan has already been "appointed" to a brand new four
year term, so he doesn't particularly care what the public thinks of him and the Fed. . . . . . . . . . .
. . . . . .. .Somehow I do not think that the 2% production increase promised by OPEC under
pressure from the Clinton administration is going to do much good. Looks like a token gesture. . .
. . . . . . . . . . . Our Uruguay coin offer is going well and we would like to thank all those who
have participated. You can still order (we have a couple hundred or so left out of the original 1300
coin offer). Don't put it off as we don't expect the remaining coins to be available for long. On the
German Mark offer last month we had several who wanted to place orders after we had run out of
the allotment. There was nothing we could do but request they wait until some more came along.
This Uruguay five peso offer is especially interesting because we have never had any of these
before and out of the original 100,000 mintage most are already housed in private collections even
though they can still be had at an attractive price within shouting distance of the gold content. The
U5 Peso is highly recommended to all. . . . . . . . . . . . . . . . . . . . . Standard Bank of London
reports today: "We did see some light physical demand (in London)between $288 and $285
yesterday and would expect the physical traders to use dips into the $285 - $282 to cover shorts.".
.. . . . . . . . . . . . . . .Not to be out-done by UK soccer fans, Los Angeles Laker fans celebrated
last night's NBA title victory by rioting, setting afire trash cans, the American flag, a news van
and two police cars, crashing other vehicles and throwing bottles at the police. The rioting trapped
thousands of spectators in the new Staples Center in downtown LA and the players had to be
moved from the arena by an armed guard. . . . . . . . . . . . . . . .As I've said many times, given
the tinder-box nature of the social fabric within American cities, what will happen if and when this
easy money new paradigm economy washes out, jobs get hard to come by, and the economic
pressure mounts? I know Wall Street and the Clinton Administration believes that the economic
cycle is a thing of the past, but there are still those of us out here who aren't buying that
self-serving analysis. . . . . . . . . Speaking of the hot and incendiary, we are hearing quite a few
complaints from our farm clientele in the Midwest and Texas. Seems we are in a full-blown
drought which augurs an attendant drop in farm production. That on top of rocketing gas prices
and one wonders if the Clinton/Gore strategy to cover-up the raging inflationary fires can last to
the November election. As we found out here in Colorado over the past week, there are some fires
you simply can't throw a blanket over. . . . . . . . . . Another report from our clientele who own
energy dependent businesses (like those with large fleets) are telling us that their pricing strategies
have been based on the old oil price. It won't be long until the new prices start showing up in a
wide range of services we contract regularly. . . . . . . . . . . . . . By the way July crude just went
back over the $32 mark. . . . . . . . . . . . . . That's it for today. We'll see you back here
tomorrow. Have a good day, fellow goldmeisters.
Leland
(06/20/00; 08:39:23MT - usagold.com msg#: 32646)
From a Friend in Texas...Here's His Plan on How to Become Rich...
"To Senator Phil Grahm:
My friend, Ed Peterson, over at Wetherford, received a check for
$1,000.00 from the government for not raising hogs. So, I want to go
into the "not raising hogs" business next year.
What I want to know is, in your opinion, what is the best kind of farm
not to raise hogs on, and what is the best breed of hogs not to raise? I
want to be sure that I approach this endeavor in keeping with all
government policies. I would prefer not to raise Razorbacks, but if that
is not a good breed not to raise, then I will just as gladly not raise
Yorkshires or Durocs.
As I see it, the hardest part of this program will be keeping an
accurate inventory of how many hogs I haven't raised.
My friend, Peterson, is very joyful about the futures of the business.
He has been raising hogs for twenty years or so, and the best he ever
made on them was $422.00 in 1968, until this year, when he got your
check for $1000.00 for not raising hogs.
If I get $1,000.00 for not raising 50 hogs, will I get $2,000. for not
raising 100 hogs? I plan to operate on a small scale at first, holding
myself down to about 4,000 hogs not raised, which will mean about
$80,000.00 for the first year. Then I can afford an airplane. Now
another thing, these hogs that I will not raise, will not eat 100,000
bushels of corn. I understand that you pay farmers not to raise corn and
wheat. Will I qualify for payments for not raising corn and wheat not to
feed the 4,000 hogs I am not going to raise?
Also, I am considering the "not milking cows" business, so send me any
information you have on that also.
In view of these circumstances, you understand that I will be totally
unemployed and plan to file for
unemployment and food stamps.
Be assured you will have my vote in the coming election.
Patriotically yours:
XXXXX XXXXXXX
P.S. Would you please notify me when you plan to distribute more free
cheese??"
Leigh
(06/20/00; 07:31:15MT - usagold.com msg#: 32645)
Aristotle
Aristotle, your gracious answers to my questions have emboldened me to ask another one! Please answer if you feel inclined:
(5) You indicate only "chumps" are buying paper gold. I thought the middle class scorned gold in any form! Who is buying this ever-increasing mass of paper gold?
Christopher
(06/20/00; 07:13:34MT - usagold.com msg#: 32644)
Aristotle msg#32616
If there were a HOF for one liners I would immediately make a nomination for the best one liner I have seen here in quite some time:
"Gold. Your affordable ticket out of Chumpville."
Thank you Aristotle for the laugh this morning that reached down to my very being.
Christopher
Hill Billy Mitchell
(06/20/00; 06:45:37MT - usagold.com msg#: 32643)
Official release
http://www.bog.frb.fed.us/releases/H15/update/
Official: Federal Reserve Statistical Release
Release Date: June 19, 2000
Rates for Friday, June 16, 2000
Federal funds 6.46
Treasury constant maturities:
3-month 5.83
10-year 5.99
20-year 6.21
30-year 5.88
upside-down spread FF vs long bond = (.58%)
Black Blade
(06/20/00; 06:09:26MT - usagold.com msg#: 32642)
Morning Wakeup Call! The War continues, overnight a stalemate!
Sources: Reuters and Bridge News
THE FAR-EASTERN FRONT:
Gold faces strong resistance at key level
REUTERS
Gold's medium-term price outlook remained positive in early European trading yesterday, but it faced strong resistance at US$290 in the short term after last week's rally ran out of steam. Traders cited the latest figures from the United States Commodity Futures Trading Commission (CFTC) which showed that, as at June 13, the market had reversed direction and held a net long position. "The CFTC figures reflect the recent price action and show that the market has seen a major reallocation process," one trader said. With all short positions now covered, a repeat performance of the last fortnight's short covering rally was not possible, he said. Spot gold was at $287.90-$288.40 an ounce in London trade, compared with New York's close of $289-$289.50 last Friday. The precious metal was fixed in the morning at $288.10, compared with Friday afternoon's $290.10 setting. Asian spot gold clawed back some of the morning's losses but still ended slightly down in thin and choppy trade. Dealers said the forecast trading range had widened slightly to $285-$293 from $285-$290. Gold ended trading in Hong Kong at US$288.50-$289 an ounce. Tael gold closed with a gain of HK$3 at $2,673.
Asia Precious Metals Review: Spot gold stabilizes at US $286
By Polly Yam, BridgeNews
Hong Kong--June 20--Spot gold stabilized at around U.S. $286 in Asia on Tuesday after falling in U.S. trade overnight, dealers said. Gold moved in a range of $285.50-286.50 in Asian trade and is expected to fluctuate between $284 and $287 in Europe and U.S. trading later, they said. Spot silver, platinum and palladium traded higher compared with their late U.S. levels in sluggish trading. Selling from Japan drove the price of gold down early Tuesday, but it rebounded later on buying from Australia, dealers said, adding, however, that neither selling nor buying was aggressive. Many players were sidelined on uncertainties over gold's direction, they said, noting that bearishness was increasing after the metal failed to break the $290 level three times over the past two days. "I think gold's next move will be downward," one Hong Kong-based
dealer said. Dealers said trading of spot platinum and palladium was also thin Tuesday, while prices of the two metals were quoted higher in Asia because dealers marked up their offers following the overnight rise in NYMEX platinum and palladium futures in the U.S. More
Black Blade: Au is stuck searching for direction. Overnight gold market action was like watching paint dry, or grass grow. Very dull action as Au just doesn't move. Ya know, it's like a turtle on its back. Not much in the news to give this turtle a gentle nudge either. Maybe the GDP numbers or OPEC can deliver.
THE WESTERN FRONT:
Europe Precious Metals Review: Gold subdued at $286, rest quiet
London--June 20--Gold prices continued to be anchored to U.S. $286 per ounce Tuesday morning after having settled there overnight. Prices were pushed lower Monday in the United States--in response to Friday's Commitment of Traders report which suggested a large number of shorts had covered positions and a stronger dollar--and eased back to where light physical buying was found in the $286 region. The rest of the complex edged sideways at overnight levels. (Story .2270)
Black Blade: Who is going to give mouth to mouth to this turtle? It's still on its back! It think he went into a coma!
Meanwhile, S&P Futures up +1.50, difference between S&P Futures and fair value -0.02, likely a flat open on Wall Street at this level. Au is up +$0.50 at $286.70, Ag -$0.01 at $4.98, Pt is flying high +$13.00 at $554.00, and Pd is down -$3.00 at $680.00.
Black Blade
(06/20/00; 05:50:59MT - usagold.com msg#: 32641)
Energy Crisis in the making!
This is from a link originally posted yesterday by Sharefin on Kitco. Sorry about the length, but an interesting read. The implications are astounding. Natural gas prices are already through the roof. NG storage is at all-time lows! Thought that Y2K was a potential problem that could have created economic disaster? Ha! Childs play! Read on………
Energy Natural Gas Outlook 2001 - $7/MM Btu
NATURAL GAS: THE FIVE STAGES TO MARKET PANIC
by Charles T. Maxwell, Senior Energy
Analyst ( maxwell@weedenco.com )
The low natural gas reinjection numbers we have seen so far this spring in the US tell their own tale. We are not on our way to putting three trillion cubic feet of gas, or anything like it, into storage for use next winter. From a low of one trillion cubic feet ( and nearly 50 % of that is facility and line "fill", i.e., is not usable ) , we would be fortunate now to bring stored supplies up to 2.3 Tcf by early next November, the start of the gas consuming season. Given the presumed retreat of the La Ni--a weather pattern, the strong US economy, and the substantial number of new natural-gas-fueled base-load generating plants using combined-cycle technology coming on stream over the next six months, I have had to revise my estimate for peak gas storage down a bit from the 2.5 Tcf number I was using two months ago.
In practical terms, unless the coming winter approaches the highly-unusual, +13% warmer-than –usual season we have just passed through, US gas storage numbers are accumulating in a potentially disastrous pattern of insufficient gas to take this country through the full span of cold weather to April of 2001. There is the possibility that we will be forced to allocate gas supplies to private homes, government departments and public institutions, to defense installations and to schools, universities, hospitals, and so on. To the degree that is necessary, gas will have to be allocated away from manufacturing industry.
Hit hardest, in such a period, would be sectors of the economy that use a high proportion of natural gas in their fuel mix such as cement plants, glass works, heat-treating and metal-shaping plants, heavy chemicals, steel, copper and aluminum makers, and so on. Subsequently, problems of insufficient production of component parts and intermediate materials could quickly spread to car and aircraft manufacturers, commercial construction and machine assembly industries. In short, the use of natural gas is so widespread in our manufacturing system that shortages of it for, say, a two month period from late January of 2001 to late March would wreak havoc on many areas of our economy.
It would surely slow national GDP growth, and heavily penalize the profits of many industrial firms. However, all this is theoretical. It really couldn't turn out this way, could it? Yes, it could. And, unless the trends I see in place now of close to 3 % incremental natural gas consumption in the US vs. flat or slightly down natural gas production are reversed for some reason I cannot now perceive, the "disaster scenario" outlined above must be considered the most likely one.
Perhaps the most intriguing part of the emerging outlook for a shortfall in gas supplies is not the fact that the crisis has arrived ( after all it has been predicted for years, and, up to now, nothing serious has occurred), but rather the point that we are advancing deeper and deeper into this energy problem and no one, other than a few Wall Street analysts, are making any warning noises about it. The media is quiet.
It is either non-believing or unimpressed by the dimensions of what is visible. Government, at all levels, is complacent. There are no public outcries even from executive figures in gas consuming industries that are heavily dependent on the fuel. We are becalmed in a sea of silence on this issue as we pass into summer. The weather is fair, and the "livin’ is easy". And, when winter comes? It's just another season, following summer. Nothing to worry about.
However, a few important people in the system quite plainly see the outlines of what is to come. Their traders are bidding up the price of natural gas dramatically ( now 100% higher than the last year's $2.10 per mm btu price at this season ) in order to secure supplies for storage now - supplies that may not be available next February when many industries could be facing downtime. These gas buyers are doing their homework. And, it is their lead that investors should be following.
Still, I am ahead of the story in my surprise that the media has not yet picked up on the coming crisis. For over the years ( and I have a good many of them ) , it has been my experience that there is a repetitive cycle to how these "threats" to the system are understood and acted on by different parts of our society.
In the case of the emerging shortage of natural gas, to take the example before us, the first group to identify it was the industry specialists ( apart from many natural gas production company managers who had spotted it years in advance ) , in particular a small group of Wall Street analysts who were doing their weekly storage sums and saw that behind the façade of last winter's warmth was a highly worrisome picture of an industry failing to convert its greater effort to find supplies ( some 650 rigs drilling for gas this year vs. some 380 drilling for gas last year at the same time ) into rising output figures. Across the board, analysts in the oil and gas industry are now convinced there is a substantial problem ahead.
This is Stage One, and it is nearly completed.
Stage Two is the tricky one. Analysts must convince their portfolio people that the problem is real, and direct them to what areas of the market to buy and what to avoid to maximize investment returns. But, portfolio managers are resistant to these arguments ( they have heard them before ) . So, only a few comprehend and accept the fundamental story, then take action. But, those brave souls start building upward momentum into the limited group of gas producing stocks that can be bought in size by the institutions (APC-53, BR-45, UCL-38, APA-60, DVN-60, and EOG-32, in order of descending capitalization ) . Then, that section of institutional portfolio managers which cannot yet grasp the play itself but which is attuned to moving into stock groups with rising upward momentum in the market ( for whatever reason ) , can be expected to swing onto the story. In this case, the natural gas producing group has recently come up on everyone's charts as being in the lift-off stage.
Finally, the remaining portfolio managers, still not convinced, are forced to act in order to maintain their performance rankings, and they belatedly enter the game.
We are better than halfway through Stage Two now, as I make it out. The fundamental players are "in", and the momentum players are starting to react. But, as to a general capitulation of portfolio managers to the natural gas shortage concept, that will be reserved for quarter-ending rallies in June and September yet to come, if I am reading the tea leaves correctly.
As I have previously noted, the media have not yet focused on this problem. That will be Stage Three.
There is a substantial story to tell here. Outages in industrial plants across (mainly) the Midwest and Northeast, with tens of thousands of workers staying home, is a major development. When TV reporters, newspapers and magazines eventually pick up the trend, perhaps several months will have passed and the situation may well be seen as more grave. Having professionally worked through the period of Energy Crisis I and II, it would not surprise me if the media termed the new "threat" as Energy Crisis III.
However, I don't think that this natural gas problem will have the public impact of the first two crises. Lack of gasoline ( read mobility ) and long waiting lines to obtain it may be more effective in influencing the American psyche than 100 industrial plants being shut down. However, Energy Crisis III is a convenient name, and at least it has the advantage of catching people's attention. Stage Three is a big step in the development of a crisis mentality in the market for gas-related stocks. But, we are not yet into this stage yet.
On the basis of widespread ( future ) media attention, Stage Four would involve governmental reaction to this, on all levels. By late summer and early autumn, we will be into the late days of the Clinton Administration's time in office. It certainly could be a political problem to admit that something this important had been allowed to develop, unbeknown to all, into a significant threat to the system.
On the other hand, the issue cannot be easily swept under the carpet because its effects are too close to breaking through into public consciousness. Moreover, the Gore-Bush pre-election debates should be in full swing by then, and Bush would be well guided to raise points, such as this, in which he has had some practical experience and for which no anticipatory consideration has been made in the non-existent national energy plan that President Clinton never formulated ( nor did any other previous US president ) . As I see it, the Government will be forced to confirm the size and scope of the gas problem, and will further alarm industry by referring to the possibility of gas allocation on a national, state or local level.
Stage Four could well occur in September and October of this year. Its outcome would logically lead to Stage Five, the final rush to panic and overexposure. This would be the result of heightened media attention, followed by effective governmental confirmation that the problem was real and might not be easily fixed except through significant sacrifices on the part of the public. Stage Five would represent a general recognition that we could be entering a difficult period of fuel shortages and that the effects might be more serious than mere "inconvenience". It should be noted that under any allocation formula, those organizations and industries that could switch from natural gas to propane, butane, heating oil or residual fuel oil would be asked to do so. And, subsequently, these products might themselves run short under the impact of unexpectedly high demand. They might also advance dramatically in price.
Stage Five would also imply a highly visible case for investing in companies that might be best positioned to assist in solving the natural gas shortage. The final run of small investors’ funds into the natural gas producers might represent a "tsunami" of money seeking entry to a play already suffering from limited capitalization, thus forcing gas producer share prices into the "blue yonder".
Stage Five, perhaps occurring in mid-to-late autumn, would, of course, be immediately followed by the actual onset of cold weather. By then, investors would also have full knowledge of the country's three-quarter-filled gas storage position. Early outages might start to occur, for coincidental reasons, in late January of 2001. However, the main weight of the shortfall would be expected to fall when different major storage points in various consuming regions of the country ran out of supplies in February and March of next year. That is when companies, facing closedowns for lack of fuel, should be most pressured to bid for gas to avoid the termination of output and temporary disbandment of their labor forces. So, we have assumed a peak to natural gas prices in February of 2001, probably in the $6.00 – 7.00 per mm btu range following a prolonged period of cold weather.
This could be the high point of fear, when many businesses could be driven to uneconomic decisions just to survive. This would logically be the exit point for experienced investors. With all five stages of the play completed, and the axe of cold weather fallen, this would be the time to collect your chips and leave the game. Conditions will likely not be so desperate or so uncertain again for some time, experience teaches us. Of course, the natural gas problem itself will not suddenly go away. It will take many seasons to find an answer to it. But, we will solve the problem, as we always do. And, as we move through the crisis and consider our options, all kinds of answers will present themselves. Meanwhile, the stock prices of natural gas producers would be expected to start down as early desperation gave way to later resolution.
What will be the eventual answers to the natural gas shortfall? Think about a higher range of prices, application of additional technology, new generations of sophisticated drilling rigs, more LNG receiving terminals, and what can come south from Alaska.
SHIFTY
(06/20/00; 04:37:37MT - usagold.com msg#: 32640)
Back to bed
A quick gold fact: One ounce of Gold can be drawn into a wire that stretches five miles!
SHIFTY
(06/20/00; 04:32:00MT - usagold.com msg#: 32639)
Ted w
If you were a criminal and going to pull a job in California using your trusty SKS , a sign like that would surely make you go home and get a different gun . One legal for crime in California !
What a bunch of dweebs.
$
Black Blade
(6/20/2000; 2:11:00MT - usagold.com msg#: 32638)
Monthly Precious Metals Forecast
http://mny.co.za/MGProph.nsf/Current/4225686D002B5E8D8025690300440A3D?OpenDocument
The "Net Profit" PM forecast found at the Miningweb. Some interesting predictions on Au 12 months out.
tedw
(6/20/2000; 0:28:53MT - usagold.com msg#: 32637)
Gold and the constitution
http://www.usagold.com
Not only has the US Government seized the right to honest money from the American people, they have succeeded in doing it without the people even realizing it happened. Sort of like a burglary where you dont realize anything is missing.
This extends to other areas too. Recently I left Oregon and took a visit to California. Over the border there was a sign posted saying if you had a SKS you were required to take it out of the state permanently, or turn it into the police.
Silly me, I thought the Constitution applied equally in California and Oregon.How is it you have a right to own an SKS in one state and not in the other?
Where is the NRA on that one?
What are you wimps in California doing about that?
?
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