Home Gold Primer Q&A Daily Market Report Gold IRA Gold Coin Prices Charts Stats Essays Site Overview High Net Worth How to Buy Gold Live Gold Price Breaking Gold News Mobile Gold Price Gold Coin Images About Us-Contact Search Video Round Tables

Welcome to the USAGOLD Gold Discussion Archives. The archives of this gold discussion forum are a treasure trove of information to educate investors about protecting their wealth through portfolio diversification with private gold ownership. The discussion forum also covers the wider issues of the past, present, and future role of gold in international monetary policy and the dynamics of the modern gold markets...   (Discussion Forum Hall of Fame) (The Gold Trail) ("Thoughts!" by ANOTHER)   The opinions posted by all guests are expressly their own and do not necessarily represent the views of the management or staff of USAGOLD - Centennial Precious Metals. The hosting of the public discussion shall therefore not be construed as an endorsement by USAGOLD - Centennial Precious Metals of any of the opinions posted here.

FORUM ARCHIVES

Select date of the archive you wish to view Month 1 2 3 4 5 6 7 8 9 10 11 12 Day 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 Year 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 Archives date back to September 22, 1998

WELCOME TO THE ARCHIVES!

ARCHIVED DISCUSSION FROM 1/20/2003
All times are U.S. Mountain Time

(Yesterday's Discussion.)

Trojan (01/20/03; 23:16:26MT - usagold.com msg#: 95059)
"The American Imperial Dollar"
http://www.scoop.co.nz/mason/stories/HL0301/S00077.htm
"Gold Is Money. Anything Else Is Merely Credit"

A very interesting Commentary !

Galerider (01/20/03; 23:15:50MT - usagold.com msg#: 95058)
PLATINUM
631.00? What is going on with this market? Are my fellow countrymen (Japan) holding some short positions again? Are there some cousins of Spot and Spike that I don't know about?

balzac (01/20/03; 23:00:01MT - usagold.com msg#: 95057)
BUSHÈS WAR
FROM THE TEXAS PANHANDLE
Shrub aint attackin hes defendin merca , aint he.

Belgian (01/20/03; 22:51:07MT - usagold.com msg#: 95056)
Ari on Sinclair
Indeed fellow Knight...Sinclair only sees the dollar at its *narrowest*. Quite understandable from his (personal) point(s) of view as Mister Gold (miner-speculator).
There is a huge difference between the dollar looking at Gold and Gold looking at the dollar.This becomes perfectly clear if one thousand barrils of oil should demand one ounce of Gold in exchange (cfr Mr. Allen - msgs # 255190/246224/ > 1997)!

It is not the dollar-currency as such, but rather what it *represents*, that is the clue. And that's much more than the dollar can carry. More and more "responsibility" is loaded on this dollar and its owners/traders. Political, financial and economic responsibilities, stretching out, all over the whole world now. Toooooo much !

*Gold* will soon present itself, to take over, the bulk of this unbearable burden weighing on the dollar's shoulders.
Westerners will be the last ones to realize that this process is being in progress. Thanks to the gold-authorities, narrow sight. A globalizing world cannot prosper on uni-lateralism. The ongoing geo-political events will soon make this more clear.

Thanks, Ari.



balzac (01/20/03; 22:42:28MT - usagold.com msg#: 95055)
RE DERIV. DISADVS.
MIKAL-RE YOUR 95049 POST
To put it succintly, the major difference for a futures market hedge
between say wheat and gold is that in a perishable commodity, a producer has a time line on the life of his product- in the case of gold the timespan is eternal and each unit produced adds to the cumulative quantity balanced against a growing world population.

So hedging wheat is not gambling but hedging gold is really
sacrifing a miners labour.

Balzac

harryo (01/20/03; 22:34:41MT - usagold.com msg#: 95054)
gold contest
correction
*******374.6******** My first submission was inadvertently submitted as 274.6

Waverider (01/20/03; 22:25:49MT - usagold.com msg#: 95053)
Rock
Having read your posts over the past few days, I thought I'd recommend a book which I think you may enjoy. It's called The Philosophy of Science: Science and Objectivity by George Couvalis. It's quite heavy reading but provides an interesting and in-depth analysis and debate regarding the essence of knowledge and truth based on observation, probability, and scientific validation versus relativism - I think that some of the issues you raised yesterday really concerned the question of what constitutes knowledge and what constitutes truth - this book addresses these issues. However, it IS heavy reading, so please be forewarned. Cheers,
Waverider

Black Blade (01/20/03; 21:52:23MT - usagold.com msg#: 95052)
Company Forecasts Likely to Be Gloomy
http://www.foxnews.com/printer_friendly_story/0,3566,75916,00.html

Snippit:

NEW YORK — 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. (MSFT), 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." Money managers recommend caution even if company forecasts are hopeful. That's because companies often start the year full of optimism, then lower those predictions as the year drags on, said John Keegan, who helps manage $2 billion for Standard Federal Wealth Management. "Anything that a company is telling you now, you've got to take with a grain of salt," said Keegan. "I'd be leery of any company coming out with a glowing forecast for the rest of the year because, from an economic perspective, we're not hitting on as many cylinders as people think."


Black Blade: I fully expect to see another down year for US equities. This will be the fourth consecutive year of declining equities indices – something not seen since 1929-1932. This is a secular bear market so I don't expect much if any improvement. In the meantime 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 a storage program of nonperishable food and basic necessities.



Black Blade (01/20/03; 21:42:34MT - usagold.com msg#: 95051)
General Electric earnings hit by $1.4bn charge
http://news.yahoo.com/news?tmpl=story2&cid=1106&ncid=749&e=8&u=/ft/20030120/bs_ft/1042490890348

Snippit:

General Electric's fourth-quarter earnings fell 21 per cent, after it took a $1.4bn charge for the poor performance of its Employers Reinsurance subsidiary. The decline in profits and the one-off charge were in line with the industrial and financial company's profit warning in November.

Black Blade: I guess as long as its "in line " with expectations it's all right. As GE is parent of CNBC I wonder if it will get any spin or even be addressed tomorrow by the sales team. I am not certain, but I think that their pension fund is under funded as well. Hmmm…



Black Blade (01/20/03; 21:32:33MT - usagold.com msg#: 95050)
Dollar May Fall as U.S. Rejects Iraqi Pledges on UN Cooperation
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=APiyIHBWpRG9sbGFy

Snippit:

Tokyo, Jan. 21 (Bloomberg) -- The dollar may fall, snapping a two-day gain against the yen, after the U.S. and U.K. rejected Iraqi pledges to help United Nations arms inspectors search for chemical weapons, raising concern the U.S. may attack. ``A war may deteriorate consumer sentiment in the U.S. and increase its fiscal deficit, thus it's bad for the dollar,'' said Minoru Shioiri, senior manager of treasury and foreign exchange division at Mitsubishi Securities Co. ``A war risk may keep weighing on the dollar.'' The dollar may fall to 117.50 yen today and 116.50 yen by the end of this week, he said.

Black Blade: The US dollar will weaken regardless. The word is that Japan will likely intervene by selling the Yen and buying the dollar but that has been a losing proposition for Japan. It is essentially flushing wads of Yen down the toilet. The Fed will likely worry about deflation concerns and do as Bernanke and Greenspan suggest – that is "fire up the presses". In order to keep foreign investment that will mean higher interest rates. With slow economic growth and resulting inflation we get – ta da – Stagflation. Also, with the huge debt load in the US it's going to be one big "House of Pain". Should get "interesting".



mikal (01/20/03; 21:20:48MT - usagold.com msg#: 95049)
Definative Derivative Disadvantages
http://www.gold-eagle.com/editorial_03/hommel010322.html
The Moral Failures of the Paper Longs -Jason Hommel
Excerpts: ".....True, the manipulation affects the entire world. It hurts miners all over the world. It continues to hurt long term holders of the actual physical metal, while at the same time, helping buyers of physical metal by providing the metal at artificially low prices. It hurts those who have invested in gold for a lifetime and now wish to sell for their retirement, but it helps those who are younger and still working, and who are able to continue to buy gold and silver at today's liquidation-sale prices.
But market manipulation is temporary, and when it ends and the price is restored to a true market value, some will be hurt, and others will benefit.
.....But buying a futures contract is not trading, nor is it investing. It is gambling. In a trade, you exchange; you give one thing to someone else, and you receive something else back in exchange from the other person. This is usually a win-win situation, as each person involved in the exchange receives a personal benefit.
Gambling, on the other hand, involves people pooling their money together, and then one person takes home the winnings. In essence, one person takes from the other, and the other is left worse off than before, not benefiting from the deal. This is unlike trade, which is mutually beneficial to both participants. This is the moral failure of gambling: the attempt to profit at another's loss or expense.
I'm not using the word "gambling" to denote activities that contain an element of risk. Life contains risk, and it is not a moral failure to attempt to live. Gambling is morally wrong because it will necessarily cause misery and loss to at least one of the participants.
Gambling is fundamentally different from producing something, or investing in something. It does not logically and necessarily follow that if you trade (or invest) dollars for gold that the person receiving the dollars will lose. .....I simply do not believe that in the event the gold price starts running away up and over $1000/oz., that the short sellers will deliver actual metal. They simply cannot do so, as they don't have the metal, and to purchase so much in the open market to cover would be impossible. I believe they will default with a cash settlement, just as the TOCOM shorts defaulted on Platinum or Palladium obligations back in 2000 or so. So, at best, there will be a cash settlement, and at worst, the shorts will go bankrupt, and there will be a much reduced cash settlement, or much delayed cash settlement, or no cash settlement at all.
True, there will be wins along the way for a few longs, before the eventual massive default happens, just as there are wins in any casino. But the majority of all gamblers lose, just as the majority of the paper longs are playing a self-defeating rigged game of gambling.
.....The third major reason that miners should publicly renounce and rebuke the futures markets is that the futures markets are the primary method being used to harm the price of the products they produce. The sooner the fraud of the futures markets is exposed, the sooner the price manipulation will end, and the sooner the miners will be able to reap the rewards of their labors.
The moral failure of the paper longs can be summarized as follows.

They are deceived into thinking that the shorts can deliver. They are deceived into thinking that the endless creation of futures contracts doesn't affect the price, but it does, it even harms the value of their own paper positions.
The paper longs are gambling, and hoping to make money off of another's loss. They are deceived into thinking that buying a futures contract is a legitimate investment opportunity, when it is actually less honest and less reliable than many forms of gambling.
The paper longs assume the risk of debt, and worse, they may lose all of their money, and have to put up additional monies in the event of a margin call. They are deceived into thinking that they "control" metal, when, in fact, they do not control (own) anything. They own a promise, not a thing.
The paper longs are motivated by greed, thinking that through taking on debt, and owning a vain paper promise, that they will profit more than those people who choose to own actual physical metal. They forget and ignore the fundamental inherent quality of owning precious metal is that it represents payment in full, and gold does not default on it's owner, it is the only thing that truly protects one from default by another. Gold is the antidote to paper promises. A paper promise is no substitute for gold.
The paper longs think they are participating in a bank run, but they are not. They are the ones on the sidelines, or at the end of the line, hoping that a default will occur before they reach the window!
It is no wonder that Warren Buffet called derivatives "sewage". They are garbage. Options on futures are even worse, garbage on top of garbage, or perhaps the slime that lies beneath the garbage pile.
I believe it is inevitable that the shorts in the futures markets for gold and silver will default. And I believe that when they do, the price of precious metals will skyrocket.
I strongly recommend that people take advantage of what they know about the extent of the fraud and deception that exists in the world, and that they protect themselves from that fraud and deception through precious metals ownership."


GratefulForGold (01/20/03; 21:19:44MT - usagold.com msg#: 95048)
White Rose
Perhaps off subject, but I didn't realize until today --are you European?

If you don't mind my asking, did you take your name from the youth White Rose resistance in WWII Germany? If so, I honor and salute your choice of handles.


Belgian (01/20/03; 21:18:22MT - usagold.com msg#: 95047)
Mitsui metal forecast for 2003 >>> Mineweb-Tim Wood
Andy Smith....a Gold authorithy ?
A.Smith : " The real shock is the trend-line in LBMA gold clearing volumes, wich terminates at zero sometime in 2007 "

For those who are intriged by this shocking two lines, from Mister Smith...I refer to Randy @ The Tower/Another msgs. #51094 and #51093 ! Bright light will shine !

Black Blade (01/20/03; 21:14:59MT - usagold.com msg#: 95046)
Crude Oil Rises as U.K. Orders 26,000 Troops to Persian Gulf
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=APiyQ_BOKQ3J1ZGUg

Snippit:

Sydney, Jan. 21 (Bloomberg) -- Crude oil futures rose in New York after the U.K. ordered 26,000 troops to the Persian Gulf in preparation for a possible war and, along with the U.S., dismissed new pledges by Iraq to cooperate with arms inspectors. Britain will send more than a quarter of its army, battle tanks and attack helicopters to the Gulf, Defense Secretary Geoff Hoon said yesterday. Earlier this month it dispatched an aircraft carrier and 4,000 commandoes to the region and sent warplanes to Jordan for training exercises. ``Sending a quarter of the British army is another clear signal'' that the U.S. and U.K. are preparing for war, said Simon Games-Thomas, independent energy analyst in Sydney. ``The oil market is concerned that the weapons inspectors will make further discoveries in Iraq,'' said Steve Turner, an oil analyst at Commerzbank Securities. ``That's supporting prices.''

Black Blade: It will be interesting to see how oil and NatGas inventories stack up this week. Also, the market is bracing for two more weeks of "confession season" as companies report earnings and Wall Street analysts make a mockery of their profession by lowering their estimates and touting companies that "met or beat" estimates. The next couple of weeks should be interesting and the Lemmings are certain to provide lots of "entertainment" for us.



slingshot (01/20/03; 21:01:01MT - usagold.com msg#: 95045)
Balzac
None. Abolish the FED. Slingshot--------------<>

balzac (01/20/03; 20:46:47MT - usagold.com msg#: 95044)
DEFLATION OR INFLATION
How many votes can I get for Mr. James Sinclar for

Chairman of the US Federal Reserve.


Balzac

DOWNUNDER (01/20/03; 20:28:27MT - usagold.com msg#: 95043)
FROM LE METROPOLE CAFE - - - RE WAR & THE BUSHES
http://www.timesonline.co.uk/article/0,,482-543296,00.html
Posted for the ROCKS of this world to ponder - -
Not that I'd expect any comprehension of the facts outlined-
-----------------------------------------------------------

January 15, 2003
Times Online, UK
http://www.timesonline.co.uk/article/0,,482-543296,00.html
THE UNITED STATES OFAMERICA HAS GONE MAD
John le Carré

America has entered one of its periods of historical madness, but this is the worst I can remember: worse than McCarthyism, worse than the Bay of Pigs and in the long term potentially more disastrous than the Vietnam War.

The reaction to 9/11 is beyond anything Osama bin Laden could have hoped for in his nastiest dreams. As in McCarthy times, the freedoms that have made America the envy of the world are being systematically eroded. The combination of compliant US media and vested corporate interests is once more ensuring that a debate that should be ringing out in every town square is confined to the loftier columns of the East Coast press.

The imminent war was planned years before bin Laden struck, but it was he who made it possible. Without bin Laden, the Bush junta would still be trying to explain such tricky matters as how it came to be elected in the first place; Enron; its shameless favouring of the already-too-rich; its reckless disregard for the world's poor, the ecology and a raft of unilaterally abrogated international treaties. They might also have to be telling us why they support Israel in its continuing disregard for UN resolutions.

But bin Laden conveniently swept all that under the carpet. The Bushies are riding high. Now 88 per cent of Americans want the war, we are told. The US defence budget has been raised by another $60 billion to around $360 billion. A splendid new generation of nuclear weapons is in the pipeline, so we can all breathe easy. Quite what war 88 per cent of Americans think they are supporting is a lot less clear. A war for how long, please? At what cost in American lives? At what cost to the American taxpayer's pocket? At what cost — because most of those 88 per cent are thoroughly decent and humane people — in Iraqi lives?

How Bush and his junta succeeded in deflecting America's anger from bin Laden to Saddam Hussein is one of the great public relations conjuring tricks of history. But they swung it. A recent poll tells us that one in two Americans now believe Saddam was responsible for the attack on the World Trade Centre. But the American public is not merely being misled. It is being browbeaten and kept in a state of ignorance and fear. The carefully orchestrated neurosis should carry Bush and his fellow conspirators nicely into the next election.

Those who are not with Mr Bush are against him. Worse, they are with the enemy. Which is odd, because I'm dead against Bush, but I would love to see Saddam's downfall — just not on Bush's terms and not by his methods. And not under the banner of such outrageous hypocrisy.

The religious cant that will send American troops into battle is perhaps the most sickening aspect of this surreal war-to-be. Bush has an arm-lock on God. And God has very particular political opinions. God appointed America to save the world in any way that suits America. God appointed Israel to be the nexus of America's Middle Eastern policy, and anyone who wants to mess with that idea is a) anti-Semitic, b) anti-American, c) with the enemy, and d) a terrorist.

God also has pretty scary connections. In America, where all men are equal in His sight, if not in one another's, the Bush family numbers one President, one ex-President, one ex-head of the CIA, the Governor of Florida and the ex-Governor of Texas.

Care for a few pointers? George W. Bush, 1978-84: senior executive, Arbusto Energy/Bush Exploration, an oil company; 1986-90: senior executive of the Harken oil company. Dick Cheney, 1995-2000: chief executive of the Halliburton oil company. Condoleezza Rice, 1991-2000: senior executive with the Chevron oil company, which named an oil tanker after her. And so on. But none of these trifling associations affects the integrity of God's work.

In 1993, while ex-President George Bush was visiting the ever-democratic Kingdom of Kuwait to receive thanks for liberating them, somebody tried to kill him. The CIA believes that "somebody" was Saddam. Hence Bush Jr's cry: "That man tried to kill my Daddy." But it's still not personal, this war. It's still necessary. It's still God's work. It's still about bringing freedom and democracy to oppressed Iraqi people.

To be a member of the team you must also believe in Absolute Good and Absolute Evil, and Bush, with a lot of help from his friends, family and God, is there to tell us which is which. What Bush won't tell us is the truth about why we're going to war. What is at stake is not an Axis of Evil — but oil, money and people's lives. Saddam's misfortune is to sit on the second biggest oilfield in the world. Bush wants it, and who helps him get it will receive a piece of the cake. And who doesn't, won't.

If Saddam didn't have the oil, he could torture his citizens to his heart's content. Other leaders do it every day — think Saudi Arabia, think Pakistan, think Turkey, think Syria, think Egypt.

Baghdad represents no clear and present danger to its neighbours, and none to the US or Britain. Saddam's weapons of mass destruction, if he's still got them, will be peanuts by comparison with the stuff Israel or America could hurl at him at five minutes’ notice. What is at stake is not an imminent military or terrorist threat, but the economic imperative of US growth. What is at stake is America's need to demonstrate its military power to all of us — to Europe and Russia and China, and poor mad little North Korea, as well as the Middle East; to show who rules America at home, and who is to be ruled by America abroad.

The most charitable interpretation of Tony Blair's part in all this is that he believed that, by riding the tiger, he could steer it. He can't. Instead, he gave it a phoney legitimacy, and a smooth voice. Now I fear, the same tiger has him penned into a corner, and he can't get out.

It is utterly laughable that, at a time when Blair has talked himself against the ropes, neither of Britain's opposition leaders can lay a glove on him. But that's Britain's tragedy, as it is America's: as our Governments spin, lie and lose their credibility, the electorate simply shrugs and looks the other way. Blair's best chance of personal survival must be that, at the eleventh hour, world protest and an improbably emboldened UN will force Bush to put his gun back in his holster unfired. But what happens when the world's greatest cowboy rides back into town without a tyrant's head to wave at the boys?

Blair's worst chance is that, with or without the UN, he will drag us into a war that, if the will to negotiate energetically had ever been there, could have been avoided; a war that has been no more democratically debated in Britain than it has in America or at the UN. By doing so, Blair will have set back our relations with Europe and the Middle East for decades to come. He will have helped to provoke unforeseeable retaliation, great domestic unrest, and regional chaos in the Middle East. Welcome to the party of the ethical foreign policy.

There is a middle way, but it's a tough one: Bush dives in without UN approval and Blair stays on the bank. Goodbye to the special relationship.

I cringe when I hear my Prime Minister lend his head prefect's sophistries to this colonialist adventure. His very real anxieties about terror are shared by all sane men. What he can't explain is how he reconciles a global assault on al-Qaeda with a territorial assault on Iraq. We are in this war, if it takes place, to secure the fig leaf of our special relationship, to grab our share of the oil pot, and because, after all the public hand-holding in Washington and Camp David, Blair has to show up at the altar.

"But will we win, Daddy?"

"Of course, child. It will all be over while you're still in bed."
"Why?"
"Because otherwise Mr Bush's voters will get terribly impatient and may decide not to vote for him."

"But will people be killed, Daddy?"

"Nobody you know, darling. Just foreign people."

"Can I watch it on television?"

"Only if Mr Bush says you can."

"And afterwards, will everything be normal again? Nobody will do anything horrid any more?"

"Hush child, and go to sleep."

Last Friday a friend of mine in California drove to his local supermarket with a sticker on his car saying: "Peace is also Patriotic". It was gone by the time he'd finished shopping.

The author has also contributed to an openDemocracy debate on Iraq at www.openDemocracy.net



mikal (01/20/03; 20:00:35MT - usagold.com msg#: 95042)
Viva Venezuela
http://www.yt.org/article.php?sid=1003
"Who's to blame in Venezuela?"
Printed on Saturday, January 18, 2003 @ 18:53:02 EST
Excerpts: Power and Interest News Report (PINR)
"The current crisis gripping Venezuela is essentially one of socio-economic dimensions. It is social because of the class nature of many of the "ideological" lines that have been drawn between the various "camps"; this is true both in a rhetorical/propagandistic sense and in a more demonstrable sense -- one that examines the different outcomes for the status of the Petroleos de Venezuela (PDVSA), Venezuela's state-run oil company, following the resolution of the crisis. It is economic in that almost all of the controversy surrounds the economic themes of nationalization, privatization, free-markets, and globalization.
Of course, even to divide the two descriptions -- economic and social -- is sometimes hard to do as they are largely interwoven. Such is the case in the Venezuela of January, 2003.
On the one side there is the government of President Hugo Chavez Frias, former paratrooper and coup conspirer himself. He's supported by a handful of remaining bureaucrats and most of the military, as well as about 30 percent of the general populace.....
Conclusion
As the economic situation continues to deteriorate and tensions build, both sides face the accusation of ruining Venezuela by absolutely resisting the demands of the other, yet the battle has grown so bitter neither side can now dream of capitulation.
Chavez argues that the weight of his country's woes are on the opposition's shoulders because they are the ones who have instigated the lockouts and shut down the oil industry bringing the economy to its knees. He says they'll just have to wait until the time set forth by the constitution for a referendum vote on his presidency. In this respect, Chavez has the advantage of showing an outward display of respect for the rule of law, a sign that surprisingly has gained him little praise in the democracies of the world.
The opposition blames Chavez for the current ills by not giving into their demands. For them, a few months are too long to wait for the referendum -- they want it now.
In the end, both sides may lose, causing a considerably destabilized Venezuela -- an outcome the U.S. and Europe are eager to avoid -- one where social and racial lines are distinctly drawn as an increasingly polarized society is unable to peacefully solve its problems. Such an environment will become extremely vulnerable to authoritarian rule."
Matthew Riemer drafted this report; Erich Marquardt contributed.
Original Source: http://www.pinr.com.

Gandalf the White (01/20/03; 19:54:01MT - usagold.com msg#: 95041)
Sir Liberty Head !!
Liberty Head (01/20/03; 19:45:52MT - usagold.com msg#: 95040)
***$360.8****
===
THANK YOU !
<;-)

Liberty Head (01/20/03; 19:45:52MT - usagold.com msg#: 95040)
***$360.8****
My second choice.

Thank You

sector (01/20/03; 19:28:49MT - usagold.com msg#: 95039)
@ CavenMan There are Many "Most Important" Events...
...in Recent Gold Developments
Not the least of which is the heavy, new physical gold demand from the Middle and Far East.

Ranking at the top however, is the revelation that central banks have sold half their gold 16,000 tonnes in order to cap it's price and elevate [Temporarily] their dying currencies. Coupled with the hard proofs of COMEX gold manipulation at http://www.goldensextant .com one comes away with a broad understanding of the present and coming gold market events. Gold has been held down ONLY by cb selling which continues today in a kind of inverted glide path upwards.

This view was developed by GATA and even now is held by only a few.

It is the key to explaining what has happened.

IF one allows himself to accept the facts that the cbs have lost half their gold, then one can see that they are desperate to get [Glide up] to a point where they can stop selling gold. This is why there won't be any appreciable fall-backs in pog. It is also why there won't be a drop if an Iraq war starts.

The G-10 want the price of gold to rise to a level where free market dynamics trigger honest non-central bank dishoarding. Allow yourself to believe that because it is true.

The devaluation, anti-deflation machine is a juggernaut.


Trojan (01/20/03; 18:59:31MT - usagold.com msg#: 95038)
@ Flaccus Re: Pravda as Source
Your point might be valid Re: Pravda as source except they were quoting Fox News. Regardless of the source issue my point is that other countries see the following comments such as these in their Media.

Donald Rumsfeld explained why the US intelligence services are not telling the UNMOVIC team where the weaponry is hidden: "We can't say where things are otherwise the next day they wouldn't be there" and admitted what Washington's real policy is: "We're trying to connect the dots before the fact. I think we've done a darn good job".

Do you really think that Pravda or any other Biased source needs to twist the facts when Rumsfeld can say something as INANE as the above.

Sure the UN Inspectors are made up of Spies for Iraq.
Give it a break, Donald. How Stupid do you think the World is ?

Anyways, the last point about Pravda. Nothing they are saying is not being said and acknowledged around the World.

Senator Byrd just said the same thing the other day.
America is losing friends and Allies and is quickly being seen as the World's Bully. He said that as a respected US Senator.




Flaccus (01/20/03; 18:44:18MT - usagold.com msg#: 95037)
Trojan/Pravda
I'm sorry but I have a difficult time even now accepting Pravda as a credible source. Tread carefully, my friend. He who walks on eggs ever runs the possibility of being slimed.

Cavan Man (01/20/03; 18:20:14MT - usagold.com msg#: 95036)
China Physical Gold Market
So many miss this cue. "This is the single most important development in the gold market since 1971."

Quote me...CM

Trojan (01/20/03; 18:18:38MT - usagold.com msg#: 95035)
Arrogance 1 Diplomacy 0 "Rumsfield's Darn Good Job"
http://english.pravda.ru/main/2003/01/20/42298.html
Since I was reading articles at Pravada I was curious to see how they were seeing the Iraq situation.

What I find so interesting about the article is the confirmation that more and more Nations appear to be tiring of the Bush Administration.

Just as Companies like Mcdonald's and Coke are being boycotted, you can see how more and more people are just looking for a place to put their assets other than the US Dollar.

With instant news and analysis available it doesn't take a rocket scientist to figure out holding US Dollars now is getting riskier each day. The Euro and Gold benefits.

But I'm looking forward to a Great Prognosis for America on January 28TH. Our Economy is Resilent and Growing. Our Nation is catching all them Evil People.

Osama Bin Who ? And Omar Who ?

And I just read that Saddam said in an Interview that he sleeps like a baby at night.

Saddam, keep getting your sleep. You will need it soon. Can You Say BUNKER BUSTERS...

Aristotle (01/20/03; 18:04:50MT - usagold.com msg#: 95034)
Hipplebeck...
How can you ask these questions? Do you have no memory of our conversation last week? Everything I offered you was basically in a direct attempt to answer your first question as clearly as possible.

To address your second question, use common sense and have a look at my post today regarding Sinclair's oversight -- value and price. You'll know the answer straight away.

Off to dine, doing my part to support the local economy.

Gold. Get you some. --- Aristotle

Trojan (01/20/03; 17:56:34MT - usagold.com msg#: 95033)
Illusion Of Reserves
http://english.pravda.ru/main/2003/01/18/42236.html
A fascinating article out of Russia about their Gold Reserves. Recommended reading. Some interesting comments about safety of holding US Dollars.

Get Gold...

Hipplebeck (01/20/03; 17:46:41MT - usagold.com msg#: 95032)
Aristotle
You said that using gold as money would somehow devalue or take value away from your property. Could you clarify?
From the time that gold was in the eight hundreds of dollars to the time that gold was two hundred fifty dollars, did the gold you held in your possession lose value?

CoBra(too) (01/20/03; 17:39:30MT - usagold.com msg#: 95031)
@ Ari - Agreed - It's not the US Dollar, only!
Here's what Dan Denning has to say:

"What's different about this gold rally is that it's part of a secular shift out of paper currencies. Investors are
losing confidence in currencies all over the world. In
fact, the only currencies doing relatively well are those
from economies with lots of hard assets or those
considering explicit gold backing."

I agree with that, even if it may be only part of your concept(ion). Same goes for any other finacial paper - including bonds, stocks and even the typical mortgaged piece of RE or home - and of course, the "hedging" pyramid of the overlying derivative structure in all its monstrous forms. The only question left is when, not if, this gigantic accumulation of debt implodes - and takes the IMF, WBk. and hopefully the FED and other CB's with it.

The "brave new world" of currencies, unbacked or rather un-shackled by real values is on its last legs. Mr. Bernankes hi-tech printing machines have been spinning their wheels for too long already, before the man (cum Greenspan) has admitted officially to that scheme, scam or sham.

... It is the beginning of a shift out of financial paper and their unbacked debt created currencies, which will lead to the accumulation of hard assets - in particular Gold, though some added Silver (love Tiffany's) would suit me well. Pretty late for (mean the nightly hour) - cb2




Trojan (01/20/03; 17:39:19MT - usagold.com msg#: 95030)
Golds Soars :-)
http://focus.comdirect.co.uk/en/detail/_pages/charts/main.html?sSymbol=GLD.FX1&sRange=3
It's a start... $357.02 Better Up then Down

Cavan Man (01/20/03; 17:36:50MT - usagold.com msg#: 95029)
@Aristotle (O wise one)
"What he said"

Rock (01/20/03; 17:32:42MT - usagold.com msg#: 95028)
Ari
Thats a big 10-4 on your last transmission.

Rock (01/20/03; 17:26:33MT - usagold.com msg#: 95027)
Terry Keenan Hit It On The Head
Tonight while watching potato head on Your World, Terry Keenan host of Cashin-in said something positive about gold she said, "whats the risk of owning gold, peace in the world?"

Aristotle (01/20/03; 17:25:13MT - usagold.com msg#: 95026)
Cavan Man, I don't know what good it'll do, but here goes...
Happy to oblige. Giving credit where credit is due!!

ANOTHER
FOA
MK
...for bringing us the message.

Also:

The euro architects
...for seeing a better way and seeing it through.

Also:

America
...for still being the best damned place to call home, warts and all.

Gold. Get you some. --- Ari


Rock (01/20/03; 17:14:23MT - usagold.com msg#: 95025)
Re: White Rose
Hi WR, You said, "-- A question to ponder while the US prepares the murder hundreds of thousands [if they get in the way) to steal the oil of a sovereign nation."

Fact: Its up to Saddam to disarm or else face military action. If Saddam packed up and left, guess what? There would be no war. If the regime came clean instead of breaking 18 UN resolutions including a recent breach maybe we could divert a war.

Again, its up to Saddam to disarm or let the allies disarm him. And I did say allies because there are many countries besides the US lined up to help take Iraq out if they refuse to comply with UN resolutions.

The world community knows Saddam is another 911 waiting to happen. Saddam enjoys putting stragitic military weapons near mosque's, hospitals and schools, what kind of person would put his own people in harms way intentionally?



Cavan Man (01/20/03; 17:10:29MT - usagold.com msg#: 95024)
Aristotle
You're splitting hairs a wee bit. While I have no disagreement with your thought on the matter, can you give credit where it is due? I think Mr. Sinclair is seeing things pretty clearly. Not everyone can fly for the USN while many still earn their wings.

Gandalf the White (01/20/03; 16:56:34MT - usagold.com msg#: 95023)
TA TA TAAA, TA TA TAAA, TA TA TAAAAAAAAAAAAAAAAAAAAAAAAAAA !!!!
COMEX POG Settlement Price Guessing CONTEST !
FIFTH UP-DATE as of 15:55 Monday 01/20/03 Denver Time
===
ENTRIES sorted in order of DECREASING Values !

**** $750.0 **** Caradoc (1/17/03; 10:49:20MT - msg#: 94778

**** $426.2 **** drawmax (1/20/03; 08:09:53MT - usagold.com msg#: 94990)

**** $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

**** $375.0 **** Mountain Top (1/19/03; 10:56:32MT - msg#: 94937

**** $374.1 **** Slowman (1/17/03; 06:10:05MT - msg#: 94739
**** $374.0 **** Zhisheng (1/17/03; 09:53:34MT - msg#: 94762

**** $373.5 **** kahulik (01/20/03; 11:08:21MT - msg#: 94998

**** $372.2 **** Houston (1/19/03; 10:30:11MT - msg#: 94934

**** $372.0 **** OZ (1/17/03; 02:14:25MT - msg#: 94727

**** $370.5 **** VanRip (1/17/03; 07:59:23MT - msg#: 94747

**** $369.9 **** Ole Man (1/18/03; 23:30:28MT - msg#: 94912

**** $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

**** $365.0 **** monTROZ (01/20/03; 12:50:24MT - msg#: 95005

**** $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

**** $361.1 **** Lothar of the Hill People (01/20/03; 13:51:40MT - msg#: 95013

**** $360.5 **** Felix the Cat (1/20/03; 03:35:20MT - msg#: 94984

**** $360.0 **** Henri (1/18/03; 15:28:31MT - msg#: 94886

**** $359.1 **** 24carat (1/18/03; 16:10:36MT - msg#: 94889

**** $358.0 **** makcumka (1/20/03; 05:44:13MT - msg#: 94987

**** $348.0 **** Topaz (1/17/03; 03:06:48MT - msg#: 94730

**** $274.6 **** harryo (01/17/03; 12:19:57MT - msg#: 94792

===

INVALID ENTRIES
---
ONE --- Previously taken number !
Liberty Head (01/20/03; 14:19:13MT - usagold.com msg#: 95016)
****$360.5*****
===

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 ?)
===

QUEST -- The FEB. 2003 COMEX Gold Contract (GC3G) SETTLEMENT Price on January 31, 2003:


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 !!
<;-)



Gandalf the White (01/20/03; 16:52:16MT - usagold.com msg#: 95022)
HAIL Sir Liberty Head !!!! Someone beat you to that NUMBER !
Liberty Head (01/20/03; 14:19:13MT - usagold.com msg#: 95016)
****$360.5*****
==
Please TRY AGAIN !
<;-)


Aristotle (01/20/03; 16:50:03MT - usagold.com msg#: 95021)
Sinclair's assessment from Trojan's post
Begging your pardon, but I think Sinclair puts too TOO much emphasis on the dollar itself in his prognosis for Gold's future. He says, "The US dollar, the US dollar and the US dollar will now determine gold's value as indicated by the USDX (The US Dollar Index)."

Sure, the fate of the dollar will definitely play into the big picutre, but at it's core it's international exchage rate affects only the dollar-denominated *PRICE* of Gold. This says nothing of its *VALUE*. In the classic example from a Turkish perspective, the price (lira) of Gold has rocketed, and yet it's value (relative to other tangibles and services) has risen more modestly. As hard as it might be to get your mind around, a rising price for an item doesn't always translate into rising value. In contrast, however, I can think of no natural instance where a rising value isn't correspondingly reflected in a rising price.

The falling dollar is not *directly* tied to the rising value of Gold, but rather its tie is an *indirect* one -- channeled through its effect on investment motivations that ultimately impact actual market supply and demand for the metal.

Sure, the impact of this indirect link can be HUGE! But let's ignore the dollar just for a minute in order to see what Sinclair overlooks. (Maybe he's considered this elsewhere, but it certainly isn't evident in this article posted by Trojan.)

For this exercise, put the international exchange rate of the dollar out of your mind, and let's just focus on the physical Gold market. Look at China. One billion people. An economic force to be reckoned with. They have earnings in denominated in the domestic currency -- yuan. Do you think they trust the national government and the yuan any more (or less) than you and I trust the paper dollar, peso, lira, whatever?

With the liberalization of the physical Gold market in China, there is EVERY reason to think that the *value* of Gold could be materially boosted worldwide, even in the face of an idle US Dollar Index. Returning to my earlier point, this rising market *value*, due to independent Chinese (or Japanese, etc.) demand upon available physical supply, will inevitably be reflected in worldwide prices, including an idling dollar, as dictated by international exchange rates.

To be sure, being so widely held, a FALLING dollar would certainly add fuel to the fire that motivate our global movement toward the demand side of the physical market equation. Up with the desire, the sought-after VALUE, up with the price. In all currencies!

I do agree with Sinclair in this: sell one third of your Gold mining shares and convert that cash into lasting Gold value which is still priced nice, still yet to be fully and properly recognized in this grandly evolving market.

As a Gold watcher, you gotta like what you're seeing out there on this physical-based aspect of the global currency *dance* (better term than *war*)!

Gold. Participate on the winning side. --- Aristotle

Trojan (01/20/03; 15:08:00MT - usagold.com msg#: 95020)
Sinclair Replies To Smith and Prechter
Just received by Mr. Sinclair in my Email Box



That Sinking Feeling: Deflation in Goods and The Dollar
==============================================

Re:Chairman's Corner - Monday, January 20, 2003

That Sinking Feeling: Deflation in Goods and The Dollar

Author: By James Sinclair, Chairman & CEO Tan Range Exploration
==============================================

A rebuttal to "Gold & Gold Shares," opinions issued this weekend, January 19, 2003, by my respected colleagues Andrew Smith and Robert Prechter separately and for various reasons reviewed.

Many economic commentators agree that we are at a major turning point. I agree with that. However, I argue that most analysis of where the economy is headed is wrong because of a fundamental misunderstanding about two crucial things: deflation and the dollar. This has implications not only on the US economy and whether we are headed for another Depression, but also the price of gold and the direction of equities markets.

On Thursday January 16th the Bureau of Labor Statistics reported that the CPI (the consumer price index, the government's most widely used measure of inflation) declined 0.2%. The dollar fell on the day.
This new number started a widespread discussion about deflation and its impact on the US economy. Many commentators leapt on this new data to cry that the major threat to the economy had just shifted from inflation to deflation. Some (notably adherents of Robert Prechter) warned of a 1930s-style collapse of the economy into Depression.

However, an article in the 1/17/03 Wall Street Journal moved beyond simply the headline number, and stressed an important and growing split between the two dominant sectors of the economy: goods and services. Prices for services rose 3.2% in December of 2002, from the previous year, pushed up primarily by rising medical care costs but also increased by tuition, homeowners' insurance, and rising charges for routine services.

But prices for manufacturing goods, excluding the volatile food and energy sectors, were down 1.5% in December 2002 from the previous year, compared to a year-over-year drop in November of 1.6%. It was the largest decline in such prices on record since 1958. Last year's drop included lower prices on everything from cars to computers to clothing for toddlers.

Will this send us into a 1930s type depression? I think not. Three important elements bear highlighting:

1. The divergent trend of prices for goods versus services has been in place for a considerable period of time. This event is not a new development.

2. The order of causal events is quite different from the 1930s.

3. The financial policymakers are ready and willing to act to prevent another 1930s-style collapse and can do so, with ramifications.

It is worth clearing up a few misconceptions.

Deflation, to be the new kid on the block must be defined as the following: a contraction in the volume of available credit or money (the monetary aggregate or M3) that causes a decline of general prices. That is the proper definition of what a deflationary depression is all about. So it is not just a decline in prices as is popularly understood. This helps to clarify the events that led to the Great Depression.

In 1929, the stock market crash led to the rapid and broad-based collapse of financial institutions (particularly commercial banks), which in turn caused a sharp contraction of monetary aggregates. This series of events contracted the supply of money and credit resulting in the contraction of prices of goods and services.

Another often unnoticed aspect of the Depression is that the existence of the Gold Certificate Ratio. This Gold Cover Clause limited the reaction of the authorities. This tied the use of monetary aggregates. The old style Gold Cover Clause mandated restrictive policy via increased interest rates rather than expansionary when the aggregate value exceeded the value of gold by 55%. Stated in other terms, the value of the gold held represented by gold certificates held by the Federal Reserve had to equal 45% of the total value of the monetary aggregate.

Simply stated the Central Bank in 1930 was required to contract rather than expand the monetary aggregate. In the 1930s, this restriction was in place as the commercial banking system collapsed. The spiral then in place tightened the noose of monetary policy just when it should have been totally accommodative. Today, as Governor Bernanke states, there is nothing to prevent the Federal Reserve from creating money at will. I   will   add yes,   that is correct, with ramifications.

The major difference this time around is that the Federal Reserve is willing to sacrifice the dollar to save the economy. Credit has been expanded significantly (consider the real estate market and personal credit card debt) and interest rates are low. This leads financial policymakers to crank the presses and expand monetary aggregates (M3).

Generally, central bankers want to crank the presses as much as a farmer wants to burn his barn full of this year's harvest. But that is what they (and Treasury officials) are going to do: they are going to burn the barn"they are going to let the dollar fall.

As evidence, consider two key recent speeches. On December 19, 2002 Federal Reserve Chairman Greenspan made a speech before the Economist Society in Washington to assure business that we will not see a repeat of the 1930 to 1934 "Deflationary Experience,"   which was   a textbook event. Those conditions are simply not what is out there now. Chairman Greenspan and Federal Reserve Governor Bernanke assured the listeners that they had the tools to inflate the prices and if they had to, they would use those tools to reverse the move of the price of manufactured goods from the negative category. Monetary aggregates, or as Governor Bernanke put it, the "electronic money Printing Machine" has no restraints. Read it and see that what I am saying is absolutely correct.

Bernanke is correct. There are no restraints now to the expansion of aggregates. There is however one thing that will reflect it. That is the value of the US dollar. Chairman Greenspan, in his December 19, 2002, speech told us that there is a rescue mechanism for the US dollar when it needs to be utilized. That device is GOLD. Here and now, I want to go on record telling you that Gold is coming back into the US Dollar within five years. Its form of remonetization will be a modernized and revitalized Gold Cover Clause not tied to interest rates, as it was as in 1929 - 1930 as the Federal Reserve Gold Certificate Ratio, but tied to the ability to expand M3 directly.
In 1930, it was the contraction, not the expansion of monetary aggregates that was the mechanism that reduced the prices on services as well as goods. That is a huge difference from today. That difference will create significant different market implications not understood so far as I see by the commentaries of my respected colleagues, Mr. Smith and Mr. Prechter. The 1930 experience is not out there now and probably will not be out there at all! Economically, what exists now that will impact markets is a unique event of significant differences not generally understood by the analytical group. The new gold community is literally terrified due to lack of understanding and their respect for these two respected honorable gentlemen who are bearish based I believe on incorrect interpretation of the economic/market causal factors now and in the 1930s. The gold share community therefore is motivated to sell, at the market, whenever they see their own shadows. The definition of their own shadow is their worst fear or classic deflation that simply does not and will not exist this time around.

What is the future of the price of gold?

The answer hinges on the dollar. If the dollar declines, gold will rise. The inverse is also true, but I believe that there is no case now for dollar strength other than short-term rallies from oversold conditions natural to all markets.

As we know, the value of a real estate investment is determined by location, location, and location. The US dollar, the US dollar and the US dollar will now determine gold's value as indicated by the USDX (The US Dollar Index). As the USDX declines, gold will rise.

This editorial, IMO, offers significant recorded historical fundamental evidence with clear definition of the condition, deflation, to respectfully rebut those who claim (such as my honorable and respected colleagues Robert Prechter and the Elliott Wave technical analysts and Andrew Smith in his $310 to $385 prognosis) that we are headed into a Deflationary Depression and taking the price of gold down.

Gold in fact recently touched $360, a significant level. Gold has gained its price level not because of any public participation. Buying gold shares does nothing for gold bullion price. Buying gold coins does nothing for gold bullion's price. Trading in paper gold futures does nothing for gold bullion's price. Trading in gold options does nothing for gold's price. Instead, those who are responsible for the recent, and probably future, of the price of gold price are the Asian and Islamic buyers. Their trading desk managers understand technical analysis so it is no surprise that these technical levels are being hit, reacted from and proceed to the next, one after another.

Thus the dichotomy between the strong gold price and the recently weaker gold shares can thus be easily explained: because almost the entirety of the public participation is focused on gold shares and the professional (Asian and Islamic) buyers are focused in cash gold bullion itself. Gold shares are likely to rally as individual investors see the fundamental support built in to the price rise cash bullion. It is not as if one cannot feed into the other but, in my opinion, the following is certain:

- Gold will not go significantly lower for any significant amount of time from here!

- Gold will trade over $400 in 2003

- The US Dollar is your measure of what gold will do now and into the foreseeable future until we maximize this entire major bull market!

Certainly, it is correct to sell 1/3 of your gold share position using strict Technical Analysis for price objectives. My position speaking to the entire gold community and not to a private clientele is that those two points now will be the broader $373 and the final point of the first wave of a 5-wave bull market in gold which will be over $400. In no way have I have moved away from the sell 1/3 program, but only adjusted to what I feel the community can handle efficiently. What others do with a private clientele is of course personally communicated, more active and preemptive.

The most popular interpretation of the Elliott Wave is, IMO, wrong both on its Elliott Wave count as well as the interpolation to the economic phenomena as a duplication of the 1930 events. It is wrong, IMO, in its prediction of the gold price and economic performance.

In conclusion:

Financial policymakers have a different attitude (aggressive) and tools (namely cranking M3) than they did in the 1930s to fight this present unique type of price decline in the price of manufactured goods which is not a classic deflation

- These new tools spell fundamental support for a major bull market in Gold.

- The bull market in gold is just beginning.

- The US dollar is the one major leader that will determine the direction of gold.

- Therefore the recent opinions offered by respected, well intentioned and well known advisors concerning the advent of a new depression may well misguide the gold investor into a liquidation at an inappropriate time and price.



Boilermaker (01/20/03; 14:54:45MT - usagold.com msg#: 95019)
Gimli msg#: 94989)
I agree that O&G well investments are risky at best and I remember losing a wad back in the late 70's when limited partnerships were drilling on leases that had almost no chance of being economic, ie., your 2 for 25 breakeven well experience. Most of these were just tax driven and the operators had none of their own money at risk. Some were sold to pay for "exploratory holes" for producers who wanted to use someone else's money for exploration of a large lease holding. If a partnership well was productive they would drill the rest of the lease with their own wells.

The bottom line is that US O&G wells can't attract much investment $ even with current high prices. We need $50 oil and $10 gas to get the US going again.

Cheers,
Boilermaker

Black Blade (01/20/03; 14:43:21MT - usagold.com msg#: 95018)
Personal finance: Investors take a shine to gold as fears rise
http://cnniw.yellowbrix.com/pages/cnniw/Story.nsp?story_id=36026445&ID=cnniw&scategory=Metals+%26+Minerals%3APrecious&

Snippit:

Falling stock markets, predictions of recession, fears of a full scale war in the Middle East and a weak dollar all add up to one thing - a huge rise in the price of gold.
A wave of buying by private individuals in recent weeks has sent the price rocketing through the $350 an ounce mark to a six-year high. The rush on the part of people throughout the world to convert their savings into something hard and tangible has destroyed the arguments of those economists who have been arguing that gold as a store of value is past its sell-by date.

They may have persuaded Chancellor Gordon Brown of their case - he famously sold off half of Britain's gold reserves at an average price of $275 an ounce - about 70 per cent of the price he would get today - but ordinary men and women in the streets, souks and bazaars have obviously not been listening. Net investment in gold has nearly trebled in the past year and the practice of converting cash into gold, normally associated with India, Japan and Middle Eastern countries, is spreading to the UK.

Black Blade: The article does take a few swipes at Gold investment though. However, this does remind me of CNBC's Ron Insana's recent comments about high net worth individuals buying physical Gold in quantity (Farfel's "Velvet Rope" scenario?). Also the Japanese housewives who are apparently investment geniuses compared to the UK's Gordie Brown. Then there are the Chinese people who are routinely buying out physical Gold as soon as the metal hits the retail establishments. Then there is the report that the US mint sales of Gold Eagles selling as much as three times the number by the 15th of this month vs. the whole month of January last year (sorry no link). As these "Times" get more "Interesting", I suspect that PM investment will only surge much higher.

Off to the Gym!



TownCrier (01/20/03; 14:34:08MT - usagold.com msg#: 95017)
HEADLINE: Buba rebufs calls for it to sell forex reserves
http://biz.yahoo.com/rm/030120/economy_bundesbank_reserves_1.html
BERLIN, Jan 20 (Reuters) - The Bundesbank reiterated on Monday its foreign exchange reserves were not up for grabs, rebuffing suggestions that part of them should be sold to finance business initiatives or repairs after recent floods.

The German central bank said the reserves played a vital role in underpinning confidence in the euro and any sale would require the approval of the European Central Bank.

"In conclusion, the bulk of Germany's currency reserves are not available for 'alternative' purposes," the Bundesbank wrote in its January monthly report.

It added that earnings from its gold and foreign currency holdings, which it said were worth 89 billion euros at the end of September 2002, formed a major part of its yearly profit, most of which is transferred to the government.

The central bank pointed out it was prevented from selling its gold reserves by the 1999 Central Bank Gold Agreement.

It said that even when the agreement expires in September 2004, it could only sell off its gold gradually ...

------(article at url)---------

Having gold reserves, and the flexibility to sell it in times of need, is better than not having it to begin with. This is as true for nations as it is for individuals. The Central Bank Gold Agreement (dominated by Swiss action) has certainly done no harm to the market's recognition of gold as a robust asset, including the recovery of its price to date. A September 2004 extention of the Agreement (dominated perhaps by German action this time) will likely do more good than harm for the future of gold simply because it's in the Eurosystem's best interest to foster healthy market recognition for the value of this important asset. Bring it on.

R.

Liberty Head (01/20/03; 14:19:13MT - usagold.com msg#: 95016)
****$360.5*****
I believe expansion of credit leads to an expansion of slavery. The price of gold will continue to rise as more folks learn what life inside debtors prison feels like.
Home/debt consolidation refi loans with high negative amoritization abound. One by one, people are going to discover the value of staying out of debt and keeping reserves of cash, gold, and food in hand.

All hail Black Blade.

Cheers



Cavan Man (01/20/03; 13:54:22MT - usagold.com msg#: 95015)
@ ge
That surely must be the beginning of the long trumpeted bifurcation. Please pardon my cynicism and scepticism. It is due and it is time (I think) to fish or cut bait.

TownCrier (01/20/03; 13:53:13MT - usagold.com msg#: 95014)
The prevailing wind blowing gold higher
http://m1.mny.co.za/MGGold.nsf/Current/4225685F0043D1B242256CB40064E3E0?OpenDocument
Mineweb HEADLINE: Hedging halcyon days are over

JOHANNESBURG – The current strength in the gold price may have helped the market to temporarily exorcise one of its biggest demons; hedging. The latest hedging survey by London-based consultancy Virtual Metals, shows hedging at its lowest level in six straight quarters, a trend pundits believe will continue for some to come...

...gold producers collectively have been one of the largest sectors of investment in the gold market. ... Aside from the benefits for securing favourable project finance from risk averse banks, hedging also became hugely profitable for gold producers and bankers alike, who began to exploit the hedging margin provided by the spread between low gold-lending rates and high interest rates.

While hedging is a bet on a falling gold price, the closing of hedge positions that has characterised the gold market over the last year is a sure sign that producers are bullish on the long term prospects for bullion.

Can they be tempted back?

Andy Smith, gold analyst at Mitsui Metals in London ... believes a terminal case of poor liquidity and a lack of depth in the gold market, will leave hedging below its hey-day of the 1990s.

"I'm forecasting that gold liquidity - the depth of gold derivative markets, gold's 'moneyness' if you like - will probably not recover on any price scenario, so there will be less hedging (than there was in the late 1990s) at any mix of price, interest rates, volatility or local currencies."

Ian Cockerill, chief executive of Gold Fields, South Africa's largest unhedged gold producer, says his firm is one of those groups unlikely to return to hedging "in the foreseeable future". "Why sell forward today if you believe the price is going higher. It doesn't make any sense," said Cockerill.

-----(see url for full article)------

Read this one.

R.

Lothar of the Hill People (01/20/03; 13:51:40MT - usagold.com msg#: 95013)
****** $361.10 ******
Shumar the ancient and wise has examined the entrails of the holy albino bat from deep within our ancestrial cavern. He sees that war or peace will be the next great event affecting the price of gold, but he does not discern the outcome--he sees only shadows and vague shapes.

We will talk of this again. I am Lothar of the Hill People.

Trojan (01/20/03; 13:50:53MT - usagold.com msg#: 95012)
Iraq The Disputed Evidence AND The Next Twelve Days
http://news.bbc.co.uk/2/hi/middle_east/2677315.stm
Well, folks the next 12 Days will prove of Great Interest To the Gold World and the World.

January 20TH To February 1ST:

January 20TH : See Link Above: It pretty well spells out the evidence or lack of it and the issues that will or will not be resolved.

January 21ST to January 26TH : Iraq needs to start to answer some of the unanswered questions and/or do something different than the Status Quo. Example - Allow scientists to be interviewed in private, Etc.

January 27TH : Hans Blix reports to UN (Monday)
(Very Important Event for other Nations)

January 28TH : President Bush's State Of The Union Speech. Very Important Indicator.

January 29TH : UN Meets in private. Extremely Important as to what is next.

January 30TH : Opinions form and Nations speak out.

January 31ST : Bush and Blair meet at Camp David.

February 1ST : Start of the War month or not ?

The markets should be very nervous the week of January 27TH to the 31ST.

This could be a very exciting Gold Week.

Looking at all the facts and clues that I see my opinion as of now is that the UN will favor more time be given to the Inspection process. (Except for USA and Britain) Bush and Blair finalize things on Friday and Saturday. The President if he doesn't show a change of direction in his State Of The Union speech will decide definitely by Monday February 3, 2003 on WAR.

Right now I'd rate it 85% that WAR is on. Get ready as it will be a Wild Ride with many SURPRISES and RISKS.

God Help Us ALL


Max Rabbitz (01/20/03; 13:50:13MT - usagold.com msg#: 95011)
The Enemy Behind Our Enemy
http://www.financialsense.com/stormwatch/geo/analysis.htm
There are many players in the world power game and it may be that the western values of individual rights are only a passing aberation and fantasy. The Saddams of this world are laughing.



Gandalf the White (01/20/03; 13:45:42MT - usagold.com msg#: 95010)
Sir ge ......
ge (01/20/03; 13:36:13MT - usagold.com msg#: 95009)
Closing Gold Price of Shanhai Gold Exchange (20 January 2003)
is 95.89 Yuan/g for 99.99% pure gold.
This should make about 360.3 USD/oz
Kitco price is 355.80. What is happening?
+++
Sir ge
Please see the morning posting from Sir Felix the Cat !
Felix the Cat (1/20/03; 03:35:20MT - usagold.com msg#: 94984)
AND the OTHER board may be on HOLIDAY also !
<;-(

ge (01/20/03; 13:36:13MT - usagold.com msg#: 95009)
Closing Gold Price of Shanhai Gold Exchange (20 January 2003)
is 95.89 Yuan/g for 99.99% pure gold.

http://www.gold.org.cn/indexe.htm

This should make about 360.3 USD/oz

http://www.gold.org.cn/hsb2.htm (conversion table)

Kitco price is 355.80. What is happening?

Black Blade (01/20/03; 13:18:27MT - usagold.com msg#: 95008)
Another Artic Blast
http://wwwa.accuweather.com/adcbin/public/headlines.asp?iws=2

Arctic air will blast in across the northern Plains and Northeast once again Thursday and Friday as record lows may be challenged. Storms will be fast moving and generally weak as they track from the northern Rockies to the southern Appalachians. Sunshine and above-normal temperatures will remain west of the Continental Divide.

Black Blade: Expect energy costs to rise as consumers and companies compete for fast depleting NatGas inventories.



USAGOLD / Centennial Precious Metals, Inc. (01/20/03; 13:12:43MT - usagold.com msg#: 95007)
Put a Foundation Under Your Portfolio
http://www.usagold.com/ProductsPage.html

Permission to reprint is hereby granted where the USAGOLD name is cited along with our web address, mailing address and phone number. For electronic reproductions, citing the post heading and the http://www.usagold.com/cpmforum/ website address as the source is sufficient.

Thursday February 9
website support: sitemaster@usagold.com
Site Map - Privacy- Disclaimer
The USAGOLD logo and stylized gold coin pile are trademarks of Michael J. Kosares.
© 1997-2012 Michael J. Kosares / USAGOLD All Rights Reserved