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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.

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ARCHIVED DISCUSSION FROM 4/21/1999
All times are U.S. Mountain Time

View Yesterday's Discussion.

JA (4/21/99; 23:21:26MDT - Msg ID:4996)
Sorry about the double posting
That happened once before, my computer gives me a message that says can't open site. So I immediately hit the post message button again. What I am learning is just because it can't open the site, doesn't mean it can't post.

JA (4/21/99; 23:16:52MDT - Msg ID:4995)
Looking for comments
Stranger

Agreed, when dealing with conspiracies it is very difficult to determine with surety what is factual and what is not. One is left to speculate and form opinions on circumstantial evidence.

On Inflation, I am in your camp and basically for the same reason, the increase in the money supply. Price of oil has to have an impact as well.

However for discussion purposes I thought the following may be interesting to get comments on.
I think I mentioned some time back that my boss gave me Gary Shilling's book titled "Deflation" to read. Someone at this site (it may have been you Stranger) recently made the observation that the price of the book had recently increased which I found a bit humorous. He apparently didn't feel a need to follow his own prognosis. In his book he basically details fourteen deflationary forces, much of which I would agree is a fairly accurate description of what has occurred, However, I don't know that I would agree they will necessarily continue to occur much longer. I have listed those forces below with my thoughts in (brackets). I would be interested in thoughts from other knights of this round table. I thought I would then in turn share them with my boss.

Shilling's Deflationary Forces

1. End of Cold War led to global cuts in defense spending. (Agreed, but what will the war in Kosovo bring, and will NATO's inability to subdue the Serb Army, give courage to China, Russia and/or others? I think Clinton is asking for more defense moneys, if he is not careful he will lose that Social Security accounting fabrication that is termed a surplus)
2. Major country government spending and deficits are shrinking. ( I don't know that the size of the federal deficit has shrink, but it is my understanding that the rate of increase has been reduced. Much of that improvement can be attributed to reduced defense spending and lower interest rates. I wonder how long those two factors will continue?)
3. Central banks continue to fight the last war---inflation. (It has been my understanding that central banks fight inflation by raising interesting rates and reducing the money supply? I don't think that is what has been occurring.)
4. G-7 retirements will lead to reduced benefits and slower growth in incomes and spending. (I suspect this is correct, you can't spend what you don't have indefinitely, unless of course you are the government.)
5. Restructuring continues in English-speaking land and will continue.
6. Technology cuts costs and promotes productivity.
7. Information via the Internet increases competition. (I do believe this is true and will probably continue to be the case. Information has the potential to truly level the playing field.)
8. Mass distribution to consumers reduces costs and prices. (I believe this is true, however a concern is that small operators are being driven out of business so we end up with mega monopolies in many industries that then free to raise prices. In Banking, Insurance, Healthcare, Grocers and other industries there are fewer players than their used to be. It doesn't seem to me that prices in those industries have gone down?)
9. Ongoing deregulation cuts prices.
10. Global sourcing of goods and services curtails costs.
11. The spreading of market economies increases global supply.
12. The dollar will continue to strengthen. (He has been right on this so far, but how long can it continue?)
13. Asian financial and economic problems will intensify global glut and reduce worldwide prices. (The rest of the world does seem to want to export it's way out of financial malaise, at what point in time will the exporting countries decide to send those dollars back for something in return?)
14. US consumers will switch from borrowing and spending to saving. (It seems that numbers came out last fall that suggested we had a negative savings rate. I don't think that switch has occurred yet. I think many of the babyboom generation have become accustomed to immediate gratification, to begin to save now many not be an easy change for them to make.)

Comments or thoughts from all would be of interest.



JA (4/21/99; 23:16:37MDT - Msg ID:4994)
Looking for comments
Stranger

Agreed, when dealing with conspiracies it is very difficult to determine with surety what is factual and what is not. One is left to speculate and form opinions on circumstantial evidence.

On Inflation, I am in your camp and basically for the same reason, the increase in the money supply. Price of oil has to have an impact as well.

However for discussion purposes I thought the following may be interesting to get comments on.
I think I mentioned some time back that my boss gave me Gary Shilling's book titled "Deflation" to read. Someone at this site (it may have been you Stranger) recently made the observation that the price of the book had recently increased which I found a bit humorous. He apparently didn't feel a need to follow his own prognosis. In his book he basically details fourteen deflationary forces, much of which I would agree is a fairly accurate description of what has occurred, However, I don't know that I would agree they will necessarily continue to occur much longer. I have listed those forces below with my thoughts in (brackets). I would be interested in thoughts from other knights of this round table. I thought I would then in turn share them with my boss.

Shilling's Deflationary Forces

1. End of Cold War led to global cuts in defense spending. (Agreed, but what will the war in Kosovo bring, and will NATO's inability to subdue the Serb Army, give courage to China, Russia and/or others? I think Clinton is asking for more defense moneys, if he is not careful he will lose that Social Security accounting fabrication that is termed a surplus)
2. Major country government spending and deficits are shrinking. ( I don't know that the size of the federal deficit has shrink, but it is my understanding that the rate of increase has been reduced. Much of that improvement can be attributed to reduced defense spending and lower interest rates. I wonder how long those two factors will continue?)
3. Central banks continue to fight the last war---inflation. (It has been my understanding that central banks fight inflation by raising interesting rates and reducing the money supply? I don't think that is what has been occurring.)
4. G-7 retirements will lead to reduced benefits and slower growth in incomes and spending. (I suspect this is correct, you can't spend what you don't have indefinitely, unless of course you are the government.)
5. Restructuring continues in English-speaking land and will continue.
6. Technology cuts costs and promotes productivity.
7. Information via the Internet increases competition. (I do believe this is true and will probably continue to be the case. Information has the potential to truly level the playing field.)
8. Mass distribution to consumers reduces costs and prices. (I believe this is true, however a concern is that small operators are being driven out of business so we end up with mega monopolies in many industries that then free to raise prices. In Banking, Insurance, Healthcare, Grocers and other industries there are fewer players than their used to be. It doesn't seem to me that prices in those industries have gone down?)
9. Ongoing deregulation cuts prices.
10. Global sourcing of goods and services curtails costs.
11. The spreading of market economies increases global supply.
12. The dollar will continue to strengthen. (He has been right on this so far, but how long can it continue?)
13. Asian financial and economic problems will intensify global glut and reduce worldwide prices. (The rest of the world does seem to want to export it's way out of financial malaise, at what point in time will the exporting countries decide to send those dollars back for something in return?)
14. US consumers will switch from borrowing and spending to saving. (It seems that numbers came out last fall that suggested we had a negative savings rate. I don't think that switch has occurred yet. I think many of the babyboom generation have become accustomed to immediate gratification, to begin to save now many not be an easy change for them to make.)

Comments or thoughts from all would be of interest.



The Stranger (4/21/99; 22:35:22MDT - Msg ID:4993)
Christine
I, too, have responsibility over other people's money. It sure makes being wrong unpleasant. If these higher oil prices don't show up in the PPI very soon, I will start spreading a conspiracy theory of my own.

Seriously, I believe your brother will be blessing you soon enough. He will not, however, ever believe that you are the one who should be calling the shots.

Gandalf the White (4/21/99; 21:47:04MDT - Msg ID:4992)
I am "smiling" at you Stranger
Sometimes I must admit, the jester in me does come out. Keep on with the discussions all -- we shall continue to learn from one another.
<;-)

Christine (4/21/99; 21:35:03MDT - Msg ID:4991)
@Al Fulchino, Stranger
Al, you sure do have some interesting perspectives to share--really made me stop and think about my own actions (a rare feat for anyone to accomplish)--but I will probably stick with, "Flush em out"--as my philosphy. Stranger, you are a great deal like my brother who also believes in importance of sticking with concrete fundamentals and market analysis. However, his analysis based on his business acumen (which is considerable) is that I am whacko for owning gold. I have endured considerable harrassment by him for this, as I have family fiduciary/investment responsibilities that he does not, and he thinks I am going to cause family investment ruin with my beliefs. Go figure. Even though I am not a business person, my portfolio looks pretty much like how Al described his own portfolio, and little like my brothers's personal investments.

The Stranger (4/21/99; 20:50:38MDT - Msg ID:4990)
T. Remital, Al and JA
T.- Inflation? Yes. I have talked about it in here for three months (I don't recall getting alot of agreement at first, either), but, "inflation like you have never seen before"? You don't have a weakness for hyperbole, do you?

Al- please allow me to add my welcome to the chorus. It is so great to read your thoughts, especially knowing they come from a successful entrepeneur.

Al and JA- I don't doubt for one moment that, where money is concerned, there will be and ARE conspiracies. But, IMHO this game of investments is usually won by he who is best informed. With so much information to absorb, how on earth do we have time for so many conspiracy theories? The other day, Gandalf tried to build a conspiracy out of floor traders going to lunch, for land sakes. (Dammit, Gandalf, don't get on my case about this. You KNOW I love you. I am just exaggerating to make a point).

No way do I want to shut anybody up. I like it in here. My point is only that USAGOLD is at its very best when it acts as a forum for hard knowledge. I have never owned a gas station like you, Al. Nor have I ever traded commodities like you have JA. Is it not when we share the lessons of these real experiences that we truly enable one another?



Al Fulchino (4/21/99; 20:06:54MDT - Msg ID:4989)
Thanks and Conspiracies
Christine and JA thank you for the welcome.

JA I grew up in Massachusetts....and simply cannot pick them up and move them up here to New Hampshire. Or I definitely would. I am however contemplating selling at least one location and starting a transition.

Christine, I, like you, have a concern about conspiracies.
The danger you and I face however is that of being set up. When you and I voice our opinions we are putting our reputations on the line. A courageous yet possibly dangerous thing to do. I again encourage all who read my words to seek out the Delphi Technique on the web,for your edification
in terms of how the other side will seek to manipulate you and your neighbors. I also have some info on Russian Psychoplotics that make for excellent reading. If I am permitted to scan it, I will upload for you all.

I realize some may think this not related to the "gold" subject, but I beg all to see the need for gold precisely because of thise forces in this world that do not have your best interests at heart.

JA (4/21/99; 18:23:47MDT - Msg ID:4988)
Conspiracy theories
Over the last several months there has been a fair amount of discussion of conspiracy and manipulation of the markets. Questions as to whether it occurs, and if so to what extent and by who? Then there are those who want to use the kinder, gentler term of manipulation as opposed to conspiracy. To help the discussion I pulled some definitions from Webster's New collegiate Dictionary as follows.

Conspire: To join in a secret agreement to do a wrongful or unlawful act.

Conspiracy: The act of conspiring together

Conspiracy of Silence: A secret agreement to keep silent about an occurrence, situation, or subject especially in order to promote or protect selfish interests.

Manipulate: To control or plan upon by artful, unfair, or insidious means especially to one's own advantage

It seems to me that from the above definitions, the main elements of difference between conspiracy and manipulation is the secrecy required in a conspiracy. That's the element that allows the conspiracy to work, the secrecy, once the conspiracy is uncovered and made public it no longer accomplishes it's deceptive purposes. Conspiracy seems to require more than one person whereas manipulation may not. And last a conspiracy is wrong or illegal whereas manipulation is just unfair. But then in my book "unfair" typically falls in the "wrong" category. So we are back to the basic difference which is the secrecy element.
In this day and age one can't be too careful about definitions, recalling Clinton's now famous statement, something to the effect "that depends on what "is" is!


Any one who has studied history knows that conspiracy's have been perpetuated by mankind from beginning. Does anyone truly believe that with the decline of basic values in today's society we have risen about that? I doubt it.

The question then remains are individuals and groups conspiring to influence the markets, are they being successful and if so who are they?

Did the Fed conspire to influence the markets in its rescue of LTCM? When one looks at the actions taken and the timing of those actions, I believe an independent jury would rule yes. If one assumes the Fed is constitutional, (which is highly questionable), did the congressional act that created the Fed give it the authority to interfere with commerce by bringing private banks and brokerage houses together to salvage a private hedge fund? NO. Where was the Fed when I made bad business decisions in the past? I would like to be able to call up a good friend at the Fed and say, I messed up on this little business enterprise I have, could you call up some of the banks and brokerage houses that have loaned me money and have them help me out. If I knew I could always do that, I could take much bigger risks.

I believe the above action clearly meets the definition of conspiracy. However the bigger concern is why has congress chosen to ignore the issue? Unfortunately we have adopted the stance that if you are "too big" we can't let you fail, not so much because the average citizen would be hurt, but because the major banks would be hurt.
I think the real question is not if a conspiracy or conspiracies exist but how extensive are they? Since common sense would suggest men conspire to do any number of things on a daily basis including attempts to influence the markets. Individuals placed in powerful positions that provide the opportunity to influence the markets will be tempted to do so for there own gain and that of there friends and those who placed them in those positions. So why do people still participate in the markets? I can think of many reasons. They don't think they exist, after all the secretiveness is the key element. Everyone is not always adversely affected from the actions of a conspiracy. Conspiracies are not always successful.

The bigger question is are people like Malachi Martin (see quote below )right wing conspiracy wacko's or is there something there? If there is no fire why all the smoke?

http://www.worldnetdaily.com/bluesky_excomm/19990421_xex_natos_real_t.shtml

As Malachi Martin observed in his book, The Keys of This Blood, the Transnational-Internationalists are in an all-out, no holds barred struggle for world hegemony, and that once that hegemony is achieved, "our way of life as individuals and as citizens of nations; our families and jobs; our trade and commerce and money; our educational systems and our religions and our cultures; even the badges of our national identity, which most of us have always taken for granted -- all will have been powerfully and radically altered


T. Remital (4/21/99; 17:29:38MDT - Msg ID:4987)
BE READY!!!!
The metal market looks ready to spring to the upside--Copper has had a strong turn around
moving from low 60.s to low 70.s-Silver looks extremly good ..making higher highs..higher
lows Platinum is pointing skyward ready to take out a down trend line...Gold is coiled up
ready to head for higher ground..with a mid point close today..taking out todays high should
start the move--The stock market is making a top --look for another big reversal using
strength in IBM to sell every thing else[don't forget that over 60% of all stocks made
there top in April last year] what you'r seeing now is the biggest distribution of most blue
chips under the windowshading of a few selected nifty promotions. Precious metals are not
only a hedge against inflation --BUT A OUTRIGHT INVESTMENT !!!!! don't be fooled///we are
heading for inflation like you have never seen before....have a good evening.

JA (4/21/99; 16:21:59MDT - Msg ID:4986)
Al Fulchino
You are a welcome addition to this round table. Your reference to kindred spirits at this site is consistent with my conclusion about the people that post here. If you were stuck in a foxhole in combat, hunting tigers at night, on board the titanic, or standing up for truth and freedom, they for the most part come across to me as the kind of people you would trust to have by your side. I don't know exactly why that is other than self reliant, independent people tend to have an affinity for gold. Maybe because it's real and you can own it. Ability to own property is a key component of a free society. Anyway, it's nice to see someone who has businesses in Massachusetts, yet has not necessarily adopted the prevalent ideology (more government is the solution to everything) that seems to be rampant in that state. Years ago I did a consulting project in Manchester, New Hampshire. I thought it a pretty part of the country. Again welcome to the forum.

TownCrier (4/21/99; 15:46:58MDT - Msg ID:4985)
Bridge NY Precious Metals Review
By Tina Petersen, Bridge News
Washington--Apr 21--
The gold and silver markets were very thinly traded today, with minuscule
volumes, according to traders. Jun gold settled down 40c at $285.5 per ounce and
May silver settled up 3 cents at $5.155 per ounce.
Traders said that Jun gold is looking for direction and could go either way
this week. "Everyone's waiting for something to break," said a trader. "It's not
servicing anyone at this level."
Traders said they expect gold to either break $285 or move down to $282 this
week, but most said they are not holding out real hope that anything dramatic
will happen for the rest of the week.
A few traders said they expect a continued choppy market for this week with
the market possibly pulling back another dollar or so by mid next week. "Unless
something happens to get things going, we're not sure what to expect," said a
trader.
Traders said news about IMF and Swiss bank gold sales are years away for the
market to be impacted yet. "Once the sales do occur, the market will have
already taken that supply into account," one trader said.
In the news, Gold Fields Mineral Services Ltd. Managing Director Philip
Klapwijk said today it appears likely the IMF will soon sell off gold holdings
to raise funds for indebted countries. He said the IMF sale has already been
priced into the market, but said gold could come under future pressure, as the
sale would send a dangerous signal to central banks about selling reserves.

--Jun gold (GCM9) at $285.5, dn 40c; RANGE: $286.4-284.6

Reprinted at USAGOLD with permission. For details please go to:
http://www.crbindex.com/
No further reproduction without written permission

TownCrier (4/21/99; 15:43:20MDT - Msg ID:4984)
'Euro faces apocalypse'
http://news.bbc.co.uk/hi/english/business/the_economy/newsid_324000/324840.stm
ECB...Bank of England committee member wants to peer into the 'Black Box'

TownCrier (4/21/99; 15:33:58MDT - Msg ID:4983)
Rubin Supports Economic Reform Plan
http://biz.yahoo.com/apf/990421/world_econ_2.html
So much clap-trap when the answer is sooooooo simple.


beesting (4/21/99; 15:31:33MDT - Msg ID:4982)
Thank you to The Invisible Hand.Msg.4964
I have a better understanding now of the effects of the EURO in everyday life.As a small merchant I am asked to accept all forms of exchange for products,including barter.

Last week a customer asked,"what kind of money do you accept?" meaning credit card,personal check,travelers check,cash,etc. Well'she asked the wrong person that, for the first time I was able to answer,"I give a 10% discount for payment in Gold."

Lets start a trend in our transactions, if I'm allowed by Government to accept about 180 fiat currencies in transactions than exchange all that paper and electronic credits to my local bank account I don't see any reason why physical Gold(with current prices posted all over the internet) can't be used in every day transactions.

Mr.Invisable Hand, have you heard anything new about the 100 EURO Gold coin that is supposed to be introduced?........beesting


TownCrier (4/21/99; 15:28:56MDT - Msg ID:4981)
Consolidation, uncertainty stalk gold sector
http://biz.yahoo.com/rf/990421/bc6.html
Though companies may come and go, metal is forever.


TownCrier (4/21/99; 15:22:00MDT - Msg ID:4980)
No need to worry about euro effect on dollar-Rubin
http://biz.yahoo.com/rf/990421/8j.html
Sees stronger Europe as very beneficial


TownCrier (4/21/99; 15:06:59MDT - Msg ID:4979)
If it looks like a war, acts like a war, and smells like a war; then Mister...buy some gold!
NATO Source: NATO Troops Could Enter `hostile' Kosovo

By Steve Ball, Bridge News
London-April 21--NATO is likely to announce at its
Washington summit on Friday that it will be sending more
troops to the Balkans, and that this would create a force
ready if necessary to enter a "hostile, non-permissive"
environment in Kosovo to "mop up" Serbian forces, a NATO
source told Bridge News today. US troops currently in
Albania could form part of the operation, the source
said.
The source said that NATO was now looking at the
composition and size of the so-called "KFOR" or Kosovo
force. The existing KFOR was originally planned to have a
full strength of 30,000 and go into Kosovo with the
agreement of all sides, but the source told Bridge News that
the situation had now changed significantly. The source
indicated that the new KFOR would have much more
firepower.
"The interpretation that you can make is that it will be
bigger and heavier," the source said. The source said it was
an obvious conclusion that NATO would need "a heavier force
if you are talking about going into a hostile or non-
permissive environment."
This could mean NATO will be sending more tanks and
heavy artillery.
The comments from the source are the first concrete
indication that NATO is now gearing up for an offensive
ground attack in the Balkans, albeit after weeks of air
bombardment have weakened Serbian troops.
It could also clear up some of the confusion about what
role US troops in Albania will perform, and why US troop
numbers in Albania have risen suddenly from 2,000 to 3,300
with the addition of a US paratroop battalion from the 82nd
Airborne Division that was not part of the original force
proposal.
The so-called "Task Force Hawk" is not part either of
KFOR or of the NATO humanitarian mission, "AFOR." Asked if
Task Force Hawk could be incorporated into the new KFOR, the
NATO source said: "It could very well be."

(c) Copyright 1999 FWN Reprinted at USAGOLD with permission. For details please go to:
http://www.futuresource.com/internet.shtml
No further reproduction without written permission from FWN

TownCrier (4/21/99; 14:58:33MDT - Msg ID:4978)
FWN Closing N.Y. Metals: Mixed; Pgm Lower on Lack of Buying
New York-April 21-FWN--
Gold edged fractionally lower, but was range-bound and
may remain that way ahead of International Monetary Fund
(IMF) meetings next week, sources said. Silver managed to
tack on a slight gain.

June palladium slid $8.15 to $376.90, while July
platinum fell $2.20 to $361.80.
"It's very, very quiet and very thin," said Patrick
Magilligan, vice president with Prudential Bache.

June gold lost 40 cents to $285.50, while May silver
edged up 3 cents to $5.155.
"Gold and silver were not doing a whole lot, although
there was some good two-way business," said Magilligan. "It
looked like funds were trying to push it up again today, but
not enough to get above (the Tuesday and March 29 high of)
$5.18 in the May.

"There seemed to be some selling around $5.17 to $5.18
capping it. It's just some dealer selling up there."
Gold may remain range-bound ahead of IMF meetings next
week, said Magilligan. There could be caution in the market
even though officials of some countries have suggested the
issue of IMF gold sales would not be on the agenda.

"Everyone seems to be more or less in agreement there
will be some selling," said Magilligan. "I don't think we
expect to see details of sales on Tuesday, but we may see an
agreement to sell."

He noted the expectation of IMF sales already has been
factored into the market, so that if officials indicate
there will be sales but offer no specifics, it may actually
allow the yellow metal to rise again.

Many analysts are looking for sales of only 100 to 300
metric tons, and this may be spread out over four or five
years, reported Magilligan. "If they do something as little
as that over four or five years, it's not really a lot for
the market to absorb each year."

U.K. Chancellor of the Exchequer Gordon Brown today
indicated that most Group of Seven governments seem to be
leaning toward the IMF sales to help relieve the debt burden
of poor countries. While he said the issue was not on the
agenda for next week's meetings in Washington, an agreement
may occur yet this year.

This comes after Canadian Finance Minister Paul Martin
said Tuesday that most nations--including Canada--appear to
support the gold sales, although he added that it remains to
be seen whether there will be any movement on the issue next
week.

There was little market reaction today to a gold report
issued today by Gold Field Mineral Services (GFMS), sources
said. GFMS offered the view that prices will remain in a
range of $265 to $305 for the rest of 1999, after an average
1998 price of $294 an ounce, the lowest since 1972.

World mine production rose slightly in 1998 to 2,555.4
metric tons from 2.480 in 1997, according to the report.
Magilligan put support for June gold at $284, then
$281.50 to $282. He pegged resistance around $288 to $289,
then $292.

(c) Copyright 1999 FWN Reprinted at USAGOLD with permission. For details please go to:
http://www.futuresource.com/internet.shtml
No further reproduction without written permission from FWN

Goldfly (4/21/99; 11:07:26MDT - Msg ID:4977)
POWERLESS
http://www.wired.com/wired/archive/7.04/blackout.html

If you get to the second or third page, you'll read all 9.

>>>>>>>

....the public health service that served Saint-Jean, needed money for medical goods but lacked cash. Since electronic transactions were impossible, he called on a friend who owned Coq Rapide, a fast-food chicken emporium that was one of two Saint-Jean restaurants remaining open during the outage. Each day Beauchamp wrote a check to the owner for up to C$10,000 ($6,634), and the owner repaid him with the same amount in cash, drawn from the restaurant's daily take.

>>>>>>>>

Pull some cash now.....!

GF


USAGOLD (4/21/99; 8:57:29MDT - Msg ID:4976)
Today's Gold Market Report: Swiss Sales on Back Burner; IMF Sales Next? Also When Is A Surplus a Deficit?
MARKET UPDATE (4/21/99): Gold continued its retreat this morning in New York
after a quiet night overseas in both London and Asia. The potential Swiss sales have already
been relegated to the back burner and "movement" on the issue of IMF sales at the
upcoming meeting in Washington "remains to be seen" according to Canadian Finance
Minister Paul Martin. Martin also said that most countries support the sales, but the press
reports did not roster those "for" and "against". Congress is now holding hearings on the
sales so the United States would decidedly appear in the undecided column. Sorry, Mr.
Martin. In that Congressional hearing George Milling Stanley of the World Gold Council
reminded legislators that the sale required 85% of the vote to pass. With the U.S. holding
over 17% of the vote, it would give Congress veto power over the sale. There is growing
opposition to these gold sales in the U.S. Congress. "Lastly on the IMF issue, Bridge
News reports that "John Willson, president and CEO of Canada's Placer Dome Inc, today
said a proposal for the International Monetary Fund to sell some of its gold stocks to
provide funds for poor nations is not a good idea, as it would only likely hurt indebted
nations by weakening the gold price. Speaking at the company's annual shareholders
meeting here, Willson termed the proposal as 'extraordinary.'" Standard Bank of London
suggests that "Gold has now been pushing up against the $285.00 level for the last three
days and we may be headed for a key session today with another failure to break higher
leading to a technical sell-off back to $282.00, while a breakthrough will target $288.00.''

If you would like to receive our newsletter FREE of charge, please go to the ORDER
FORM. The latest edition is now ready for distribution. If you do not receive the
newsletter, you might not want to miss this month's issue which covers the oil situation as
it relates to the gold market.

In Brief(4/21/99).....The euro continued its trek toward parity with the dollar albeit at a
more subdued pace in today's early going. IMF chief economist Michael Mussa called euro
weakness against the pound and dollar "unusual and likely to be corrected" Question Mr.
Mussa: By whom? When? And most importantly -- Why?......The Bundesbank said today
that the German economy will face a "difficult year" in 1999..........Brazil is taking it's
IMF medicine. Yesterday it slashed government spending by 10%..................Checking
Barron's Market Laboratory we find our usual treasure of interesting statistics. Most
importantly the national debt has gone from $5,551,300,000,000 to $5,666,200,000,000
over the past twelve months. Putting paper to pencil that calculates to a $114.9 billion
addition to the national debt. The mathematically disinclined Clinton administration as well
as the equally deprived Congress has called this large deficit a large spendable
surplus....................Also of interest is the fact that the Federal Reserve -- which also
believes that the government is running a surplus -- managed to purchase $33,231,000,000
of this non-existent debt for its own account.......Just one more of these little math tricks
and I'll let you go for the day: The foreign held debt has declined by $9.77 billion in the
same period reflecting primarily Japan's lack of interest in supporting our debt market and
forcing the Fed's monetization policies, aka cranking up the printing
presses..............MK

YGM (4/21/99; 8:08:13MDT - Msg ID:4975)
@ Cobra(too)
I'm still about. Been standing too close to the fire for too
long now. Time to stand back and try to put (or gain) some
perspective on information and theory overload. Rest
assured the Gold always finds it's way to the surface come
spring/summer. Thanks for thinking of me---Regards: YGM.
GO GATA!!!

T. Remital (4/21/99; 6:37:02MDT - Msg ID:4974)
Y2K
Steve H. ..That is a great speach you gave.Congrats. DON'T FORGET THE MATCHES!!!

TownCrier (4/21/99; 6:25:08MDT - Msg ID:4973)
Hear ye! Hear ye! This Week in Gold has been updated!
http://www.usagold.com/wgc.html
The latest Weekly Gold Market Commentary by World Gold Council's George Milling-Stanley is now appearing at USAGOLD for your reading pleasure. IMF...LBMA...and Swiss Gold.

Click the link, intrepid knights.


Christine (4/21/99; 6:23:02MDT - Msg ID:4972)
Now IMF trying to talk down Nikkei/commodities too
MK--thanks for "Tokyo stocks pulled lower by IMF pessimism" link. If this isn't blatant manipulation/conspiracy, I don't know what is. What "microeconomic" factors can they be referring to. Baloney Sandwich.

TownCrier (4/21/99; 6:13:05MDT - Msg ID:4971)
**Greenspan presses U.S. politicians on free markets**
http://biz.yahoo.com/rf/990420/bwt.html
*****MUST READ***** (in addition to the prior news article.)*****
``His Ayn Rand conservatism implies free-market capitalism in its purest form. That is his philosophical grounding but it does put him on a collision course with the administration in some areas.''
Greenspan's willingness to speak out on issues has increased over time...hard money and fiscal restraint.

TownCrier (4/21/99; 6:03:42MDT - Msg ID:4970)
U.S. bangs drum for world finance reforms
http://biz.yahoo.com/rf/990420/b1e.html
This might be it!

Next week's finance meetings set the stage for June G7 meeting in Germany..."U.S. officials insist that much of the real action has been taking place behind closed doors, away from the glitzy stage of top-level international meetings."

SteveH (4/21/99; 6:01:31MDT - Msg ID:4969)
Gave speech to local business Association on Y2K...
It went well:

Good afternoon ladies and gentlemen. Thank you for inviting me to
speak to you today. Yesterday, I spent the day at Spring Comdex in
Chicago (the baby version of the largest computer show held each year in
November, the one in Las Vegas). I had not yet written my speach for
today but did walk around the show thinking about what I would say. I
was fortunate to attend the Keynote address at Comdex by Bill Gates. He
introduced his new Windows 2000 suite of software in a multi-media show
of videos and large stage props of computer props such as their new
mouse to be brought to market in the fall. It will have no moving parts
and can be used on your leg, arm, chair, table etc. It won't get dirty
on the inside and quite working.

One of the video clips was Jay Leno interviewing people and asking them
who Bill Gates was. One person said, "Isn't he the guy who started
Apple?"

Jay asked another person what Y2K was? She replied, "Isn't that were
they haven't figured out how to replace the 19 with a 20? If they figure
that out we should be ok"

One Y2K expert said that Y2K is "...largest bugfix in history with an
inflexible deadline."

That is a good introduction to Y2K because it speaks directly to the
issue of Y2K and what exactly it is.

For those amongst us who may have just come up from their bomb shelters
from the threat of nuclear war during the President Kennedy era and the
cuban missile crisis, Y2K is the debacle in which all those Cobal and
Fortran and for that matter anybody who wrote code up until but a few
years ago didn't think their legacy software would have ever make it to
the turn of the century so why worry about coding it to handle the turn
of the century?

How good their programs were to make it to the end of the century but
how bad they were to not have thought about that one bug that could shut
lots of software down at one minute past midnight on January 1st, 1999.
Some pundits, analysts, and naysayers concluded that all is not well in
computerdom and are sending the message to all of us, "Houston, you
have a problem."

AND exactly what is the problem and how will it (likely) affect you and
I?

The problem is that no one really knows the extent to which the problem
will affect us. And nobody knows exactly how it will affect us. The only
thing certainty is that it is affecting us and will likely do so at
least sometime past the start of the new year.

The issues as I view them are three:

-- Self-fullfilling prophecy makes what would have been a lame
turn-of-the-clock event into a potentially devasting happenstance. --
Our just-in-time society may just become just-when-I-have-time. In other
words, our fragile distribution and transportation system are extremely
efficient and any serious Y2K unfixed bugs could clog the system.
--Finally, our banks with only about 1% in reserve cash can't handle
more than a very small percentage of folks asking "where is my money?"
Or, asking for their money.

What it boils down to is potential stress on a finely oiled economic
engine. It couldn't be happening at a worse time.

But before we get into a few of the potential threats of Y2K. Let's talk
about for just a moment what you can do to make your computers Y2K
ready.

-- Go to your computer manufacturer's web site and find out if they have
a solution for your computer. -- If you can not find a Y2K testing
program from your manufacturer or an updated bios then you might
consider a third party bios card that takes over the date and time
function for your computer. -- If this seems to mind boggling then get
hold of a reputable computer firm and ask them to do a Y2K audit on
your computers and on as much of your software as is practicle. --
Download any patches that you can find for your important software. --
Order your new BIOS chip if there is one. -- Contact your software
manufacturers to see what patches they offer. -- Implement the patches,
bios upgrades, and new purchases as is necessary to bring your hardware
and software into Y2K compliance. -- As a rule, if you bought your
computer in 97 or before (and maybe even part of 1998) then you may have
a hardware Y2K problem.

Now that you have addressed your personal Y2K problems, what are some of
those events that could happen to make our lives more complicated than
we might want at the turn of the century?

--Bank may limit withdrawals of cash in excess of a certain amount or
declare frequent bank holidays in order to prevent a bank run or runs.
--Reports of food, medicine, and gasoline shortages could trigger mass
hording and some riots and violence. --Imbedded chips and Programmable
controls of refineries, power plants (nuclear and regular), and
pipelines may cause shut downs, possible explosions thus causing
possible supply problems. This is why some of the more at risk
organizations will shut down for a few days or more at New Years. To
prevent a catastrophe.

In short, any failure in any one of the "three legs of banking,
telecommunications, or energy/electricity for any sustained period..."
will cause problems with our just-in-time economy as it will not be
just-in-time.

So why is it that it couldn't be happening at a worst time? If you are
an ardent follower of CNN and moneyline you would believe that the
economy has never been better and that the stock market will continue to
make new highs forever or at least until the next level is reached,
which they believe is 11 thousand.

Here are but a few of the underlying problems that Y2K or a very high
oil price could affect significantly:

Price of gold and silver are at an 18 year low. Y2K buying is already
stressing the supply of gold and silver to investors putting upward
pressure on these prices and it is only April. A local coin dealer told
me that he has sold 1040% more gold this year so far than last year. If
gold were to become seen as an alternative to the stock market as it
was back in 1979, then this would pull money from stocks and bonds and
cause a major reevaluation in the price of gold and cause the market to
drop precipitously.

The US mint put the production of gold and silver eagles on allocation.

The NASDAQ and DOW are setting unprecedented highs that a Y2K panic
could set on its ears.

As mentioned banks only hold 1.17% of their reserves in cash. The
Treasury is reportedly printing an extra $50 billion to bolster the cash
reserves that are approximately $400 billion right now. If every
voting-age American withdrew $500 that cash would be depleted.

Y2K could cause wide-spread and lasting electrical outages leaving us in
Michigan cold in an already cold winter. That is why the sale of
generators are at an all time high.

Y2K could cause food shortages and fuel shortages that would hamper us
from getting the basics and could cause widespread panic and mayhem.

Of course these are just "could a's, would a's." What really happens
depends on us. So what should we be doing to prepare?

I read a headline the other day in a Y2K rag that said, "Why wait until
the end of the year? Panic now." They went on to explain that
preparing now will produce less stress on the system and possibly even
avoid any last minute shortages. Should we panic now? What should we do?

Here is my suggestion. Don't panic. Be smart and prepare.

Owing some gold coins and silver coins is a good idea. After all gold
and silver are not anyone's debt or promise to pay or be paid. They are
money in its purest form, so why not have some just in case? But you
better act now because the price won't stay low forever.

When you shop at the grocers, get extra rice, flower, sugar, coffee, and
canned food, enough to last for maybe a week. Having extra coffee or
sugar to barter with a neighbor is always a good idea. Do you need a one
year supply? That is entirely your call. But if you believe it, so might
your neighbor and their neighbor and so on and so on. Then we have
panic. Be sensible.

Should you buy a generator? If you can get one, it might not be a bad
idea.

Should you get an outdoor grill with lots of charcoal? Good idea.

Should you buy a gun? I won't go there.

Should you have extra blankets? Always a good idea.

Should you have extra cash? Each payday tuck twenty or so away.

Just remember don't panic. If you do, so will everyone else. Here is a
web address with further helpfull hints on preparing for Y2K:

www.SurviveY2K.com

Conclusion: Y2K is a phenomena that will stike the hardest to those who
depend upon computer technology the most and have ignored the problem.
It will stress our financial, transportation, and energy sectors
possibly to a point that it will cause shortages and stoppages. By
preparing now for the future you are better than waiting until the last
minute but by being sensible and a good neighbor we will make it through
this with minimal impact.

I believe that many will wake up the day after Y2K and say, "Now that
wasn't so bad, was it? There will be lots of cheap generators for sale,
that is certain."

Y2K has caused many to re-think the basics. I am going to shift gears
briefly and then open the door to questions and comments.

Some topics for open discussion:

Our frail market. Derivative and margins in our markets. 1929 and now. 5
Trillion in debt.

Oil depletion and production and true cost of oil and the paper barrel.

The IMF.

The Euro, gold, and oil.

Making us aware.

Are there any questions or comments?





TownCrier (4/21/99; 5:56:30MDT - Msg ID:4968)
Brazil publishes ex-Cenbank chief's seized papers
http://biz.yahoo.com/rf/990420/b2m.html
Central Bank corruption, and making profit on currency devaluations.


SteveH (4/21/99; 5:55:25MDT - Msg ID:4967)
June gold now...
$285.70.

I wrote this to my Congressperson:

I am deeply saddened by the events in Littleton. But unlike reactionists who believe that gun control is the answer, I believe that gun-carry laws allowing responsible citizens to carry concealed weapons would have possible lessened the death and injured toll in Colorado.

Allow me to relate a story about citizen enablement. I recently ran up the side of an embankment during a winter storm on US XXX. Thirteen cars actually hit each other but my car escaped with only a broken fog lamp and slightly dented spoiler. Route XXX was clogged for two hours. I called in the accident using my two-meter amateur radio and also later checked on the arrival of police, fire, and ambulance. The citizens, none who were police or fire folks, assessed all injured, cleared a lane, directed traffic for a half-hour before any official vehicle arrived and then for another one hour. When the ambulance arrived I rushed over to describe to the them the injuries and point out the cars. The ambulance driver said, "Who are you?"

I replied, "Just an Amateur Radio operator."

He said, "Thanks but we will handle it."

I become instantly aware that our society relies on officially sanctioned personnel to handle police, fire, and safety. But yet, it took them over one and half hours to arrive. I went about my business as did the other five or six folks who also helped out feeling that we had made a contribution.

Getting back to Littleton. Society failed miserably to provide a quick and actionable response to the murders. All involved in the shooting must have felt horribly inadequate to respond to such a tragedy. Had a few of the teachers or coaches been legally carrying concealed weapons, they may have averted a number of the deaths or injuries, but we will never know now.

You see it is quite simple. Enablement, responsibility, and accountability are what make our society great. Removing and disempowering citizens is not the answer; rather, giving back the power to act without reprisal of unfair or too restrictive laws is the answer.

In that vein, I urge you, no I implore you, do not let our great country be diluted by gun control advocates who see removing guns from its citizens as an answer to tragedies such as Littleton that would have been stopped cold by teachers with the right tools. Give back to each citizen the power to respond in kind. Train us if you have to but until the US sees citizens as empowered participants it will only continue to get worse.

Sincerely,

SteveH

TownCrier (4/21/99; 5:52:16MDT - Msg ID:4966)
Tokyo stocks pulled lower by IMF pessimism
http://biz.yahoo.com/rf/990421/ch.html
Micro-economic factors don't justify recent rally

Christine (4/21/99; 5:08:36MDT - Msg ID:4965)
Refinery Fires, Conspiracies, All My Investment Mistakes
Hello Al Fulchino--Thank you for your interesting perspective. I am one of the local conspiracy theory advocates. I was most interested in your comments about how you have feel you have received encouragement to raise your pump prices liberally, and on the refinery fires. I have been thinking the refinery fires have had some very strange coincidental timing, but didn't want to say anything for fear everyone would find out how really whacko I am. Stranger--You caught me. Have I ever made some investment mistakes. I am trying like crazy to understand what the heck is going on. Maybe I am incapable of understanding market forces, so I resort to blaming manipulation. Believe me, I have not ruled this out as a possibility either. However, right now I am sticking with my conspiracy theories, because the more I look at things through that framework right now, the more they start to make sense. I sincerely believe my own biggest investing errors so far have been due to underestimating the effect of human market manipulation. Also, I pray that some of my concerns are simply an overactive imagination.

The Invisible Hand (4/21/99; 3:25:25MDT - Msg ID:4964)
Euro and Gold Antitrust

I said in message 4913 that the euro does not exist in paper, but only electronically, and that Y2k endangers electronic money.

Beesting asked in message 4933 how the euro affects workers. He wanted to know whether workers get their paycheck in local currency or whether they get paid in euro's and convert to local currency when they buy local goods. He also asked whether credit card purchases in local currency are converted to euro's and then back to local currencies. Finally, he wanted to know whether the public is involved in euro transactions at all.

The Stranger asked in message 4946 what rules apply to the ECB with respect to money creation parameters.

Aragorn III asked in message 4927 whether money is defined by the skins of those who keep the books, or perhaps by its function.

Let me start with Aragorn III's question. In the June 1934 Introduction to this book "The Theory of Money and Credit", Ludwig von Mises writes that money is nothing but a medium of exchange and that it completely fulfils its function when the exchange of goods and services is carried on more easily with its help than would be possible by means of barter. Amen.

As I said in my original message, I don't know anything about money creation and can't answer The Stranger's question. It occurs however to me that you need a (paper, since under the gold standard, there's no money creation, I think) base from which the creation can occur.

What is this paper base, and here I come to beesting's question, for the euro? Well, it's the eleven currencies (the mark, franc, lire, peseta, guilder etc.) which are subdenominations of the euro. I suppose that that paper base can't be extended by the ECB nor by the 11 national banks. Please remember that I don't know what M1, M2 and M3 are, nor what repo means.

Now beesting's questions. People can choose to have their bank account in euro or in the national currency. I still have mine in the local currency, but the ATM machine and my bank statements give the balance in local currency and in euro. When you pay with your ATM card in the supermarket, you can pay in euro or in the local currency. I suppose people can get their paycheck in euro and can then pay credit card purchases in euro. The stock market quotes are in euro and fortunately in the paper there's also a conversion of the euro price to the local currency.

I still don't see the advantage of using the euro, except that it allows consumers to compare prices transnationally.

By the way, my statement in message 4926 about the antitrust action against gold traders (I said that antitrust law was endangering society) gets credit from message 4956 where SteveH refers to Reuters which reports that the government is part of the conspiracy. Of course, government can make conspiracies (like minimum wage) work (in the short term, but destroy society in the long term)..

The IVH


The Stranger (4/21/99; 0:09:22MDT - Msg ID:4963)
Christine
You betcha, Red Rider. I agree with every word you said. As an investor, however, my challange is to learn as much about the markets as I can. If, every time things don't work out as expected, I chalk it up to fixed markets, I will allow my own self-righteousness to deny me the real lessons I should have learned. (Stranger's Law- 99% of the time, an investor's worst enemy is himself. The other 1% is probably statistical error).

If any one in here REALLY thought that the markets were THAT conspiratorial, they wouldn't risk their money on them, anyway, would they? I sure wouldn't. (This ain't supposed to be no Las Vegas, ya know).

Say, how does a psychotherapist know so much about finance, anyway? You aren't joshin' are ya?



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