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ARCHIVED DISCUSSION FROM 6/2/1999
All times are U.S. Mountain Time
View Yesterday's Discussion.
Peter Asher
(6/2/99; 23:56:05MDT - Msg ID:7059)
Golden Truth
That URl is drawing a blank.
Golden Truth
(6/2/99; 23:45:30MDT - Msg ID:7058)
June Gold Now $264.10
Hey everybody all together now how low can you go? Don't be shy jump on in and lets do the GOLDEN LIMBO yah, wa hoo what a party? I stil say can't go much lower than Silver right?
Peter Asher
(6/2/99; 23:39:15MDT - Msg ID:7057)
Turbo, Ari, Jinx, Golden Truth !!!!
You guys are in great form tonight, great reading. Give 'em hell.!! --- THX, to bad your hands are tied, it's a good plan. I believe I once quoted a famous philosopher about "intelligence being measured by the ability to evaluate relative importances." The scenerio you want to protect yourself from may include the demise of the job in any event. Gold could be a great asset to "grub stake" your own business. As the song say's, "Take that job and shove it"
Golden Truth
(6/2/99; 23:22:09MDT - Msg ID:7056)
Plunge Protection Team
http://www.freerepublic.com/forum/a37553a4471c.htm
Here it is Folks more SKULDUGGERY!!!
Golden Truth
(6/2/99; 22:59:41MDT - Msg ID:7055)
CURRENCY CRISIS
http://www.stockhouse.com/interviews/may99/0527
Excellent interview with the original Gold Bug JAMES DINES. Very current and easy to understand. Ties in to my earlier post today about World Currencies racing each other to the bottom and our coming depression. BTW i havn't heard much lately from Gata?? Anyone hear of something lately? They seemed to be going strong a couple of weeks ago and now nothing. Also what about the June rumour that the YGM talked about saying that i think german cherez(sp) the banker out of PERU said the price of GOLD would be set free? I guess he meant DOWN? Also where is this staged currency crisis where you turn in your old money for new money that has a metallic strip in it? Wait the best one yet a staged Gasoline Shortage? i just saw gasoline drop 2cents today. One thing i leared here is that "conspiracies are cheap and it takes real money to buy booze" That seems to be the problem the more Gold i buy on dollar cost averaging the less booze i can buy and the more money i lose. I,am beginning to think lifes to short for this and we cah never Win. GOLD is way to manipulated and they have gotten real good at it. What do you think? i'll gladly eat my words if someone knows better, i mean how low can they go and for how long? In the mean time GOLD SUCKS! Because our Goverments SUCK BIGTIME and i feel until that stops we are all Doomed. Just read about the "Plunge Protection Team" over at that other US gold site and you'll know what i mean they been buying 5000 lots on the s&p500 to prop up the Bubble and aparrently to help hillary clinton line here pockets. I mean talk about corruption! Can't really blame a guy for be somewhat disappointed can you. I hope they all Burn in HELL and are salted with fire night and day and may their GOLD be used against them in JUDGEMENT DAY and consume their FLESH to the BONE!!!!!! Now there's something i can sink my teeth into. The price of GOLD may never rise but your torment WILL BE ETERNAL!!!!!!!! AS GOD AS MY WITNESS AND SAVIOUR.
THX-1138
(6/2/99; 21:23:35MDT - Msg ID:7054)
reply to jinx44
I would love to buy a house with it, but not in the State I currently live in. Besides, if I was to default on the house and loan I could lose my job and security clearance due to financial problems. (Real big issue in the office I am at because you become a security risk.) Was in Alaska once and have been trying to find a job to transfer back up there. Really hard. Never move to Alaska if you don't have a job to go to. More than 17% unemployment during winter months.
jinx44
(6/2/99; 21:14:18MDT - Msg ID:7053)
Bail out! THX 1138
Take the money out of the fund, buy a house, get a 125% mortgage and buy the yellow. Let the bank and the govt eat the house. It's only FRNny money! And to all those who's knees jerk and they murmer "gee, that's not right", wake up and feel the handcuffs. A 1930 dollar is worth 7 cents today. Legal theft anybody?
Aristotle
(6/2/99; 21:09:50MDT - Msg ID:7052)
Turbohawg, I'm glad to be back, old friend!
Loved your comments to TownCrier on free trade. This comment of yours may help people see things as they should:
"If one chooses to, say, buy steel from Russia for any reason, cheaper price or not, what moral case can another make to prevent him from doing so?"
Excellent! And because steel is a metal, it makes the example even better. As you "buy" steel from them, they are getting something of equivalent value in return. What are they getting? In other words, what are you paying with? Let's assume they are too wise to accept our fiat currencies. Let's say you are paying with wheat (a good, solid, international-type trade, wouldn't you agree?).
OK, now let's take a different look at this. What person can really identify which person is buying from which? Who is the buyer and who is the seller? (Let's not use that uncivilized word, "barter") Are you buying steel with wheat, or are they buying wheat with steel? IT DOES NOT MATTER!!! What matters is that the TRADE DOES OCCUR!
And as you say, what power or entity would dare intefere with this exercise of human rights?
Let's get back to money. Simply imagine that instead of steel, Gold is used in the above transaction. And because it works so well, imagine if Gold were to play one side of each and every transaction that couldn't otherwise conveniently match desired imports. Gold is money, my friends. Insist on free trade, and honest money. If the money doesn't work, neither will trade. (And on my honor, I really enjoy cooking with spices from all over the world, and drinking beer from everywhere, coffee, tea, cheapest petrol, etc.)
Gold. Insist on it, and make you some. ---Aristotle
Aristotle
(6/2/99; 20:44:26MDT - Msg ID:7051)
From SteveH's article on Mr. Munk and Barrick Gold
"Not one ounce of gold Barrick has mined has ever been sold for the market price."
Did anyone else find that line as remarkable as I did??
"Not one ounce of gold Barrick has mined has ever been sold for the market price!"
Oh, yeah. Sure. When you are buying shares of Barrick's mining business, you certainly should NOT be confused into thinking that you are in ANY stretch of the imagination using Gold as your hedge against a dollar-demise. Sheeeesh! For their business paradigm, they might as well be baking Nabisco Oreo Cookies and speculating on Gold futures on the side.
Granted, the paradigm worked fine under falling Gold prices. Gold above their averaged hedged price will put them in a losing position for the amount sold forward. Stay nimble, Peter ol' boy, and guess well, or you are surely here today and gone tomorrow. I'd rather lock in PAYMENTS of future dollars than RECEIPTS of future dollars. Isn't there a Public Relations problem when you deliver Gold at $400 per ounce at a time when everyone else gets thousand$, and minimum wage has become $100 per hour?
Don't laugh. Gold is obtained against just such a scenario, and you, Mr. Munk, have a business paradigm that is no proxy for Gold. See if you can change your listing on Wall St. to HEDGEFUND.com. Perhaps you would then be better rewarded for your efforts.
Cavan Man
(6/2/99; 20:32:50MDT - Msg ID:7050)
GW & Foreign Entanglements
USAGOLD: I believe Washington's concern for foreign entanglements reflected the often pitched battle between Jefferson and Hamilton; one being in the French sphere and the other in the British. Also, there were dark, storm clouds on the horizon in France as you know.
Cassius
(6/2/99; 20:29:53MDT - Msg ID:7049)
Would the Japanese dump their US Treasuries. This scenario says yes.
http://www2.gol.com/users/png/postal_savings.html
Depressed about the price of Gold. Well, no matter how the situation plays out with the Europliles vs. the $philes, this scenario says that by 3/31/00, the POG is destined to move up, with the resultant inflation driving it. I always wondered what would be the trigger for them to send all those $$$$ back to us. Cassius
Cavan Man
(6/2/99; 20:12:39MDT - Msg ID:7048)
Commodity Prices: Linerboard & Medium
Linerboard is the stuff corrugated packaging is made of. Medium is the squiggly stuff in the middle. The cost of linerboard converted into various corrugated packaging products affects almost every product we consume. Strange to say but life without corrugated boxes would be quite difficult. Recently, there has been a wave of consolidation in the industry. The trend is continuing consolidation. As the industry consolidates, excess capacity is taken offline permanently. Prices are rising. The industry is moving ahead with a second price increase this year and expects to get it; the first increase sailed thru. (FYI to all )
Cassius
(6/2/99; 20:09:35MDT - Msg ID:7047)
To: Golden Truth
Ah, yes, that does make the msg more meaningful. Thanks, Cassius
Al Fulchino
(6/2/99; 19:59:05MDT - Msg ID:7046)
Calm before the storm?
Gasoline wholesale price drop of 2 cents/gallon today. First drop since the 18-20 cents/gallon runup earlier in the spring.
turbohawg
(6/2/99; 19:39:20MDT - Msg ID:7045)
TownCrier
thanks for the Greenspan link ...
>"We try to promote free trade on the mistaken ground that it will create jobs. The reason should be that it enhances standards of living through the effects of competition on productivity." -----FRB Chairman Alan Greenspan
It's good to see Greenspan out there making the case for free trade ... if only those politicians who are supposed to be on our side would do the same ... are they capable ??
Furthemore, shouldn't the case be made on more than just economic grounds ?? Isn't the MORAL case at least as important ??
What right does one person or group have to dictate who another person trades with ?? What right does govt have to step in and decide the winners and losers ?? Power, yes ... right, no. If one chooses to, say, buy steel from Russia for any reason, cheaper price or not, what moral case can another make to prevent him from doing so ??
Where are the leaders in this pseudo-free country who have the integrity and courage to stand up for free trade because it's just ?? Where is the devotion to the principle of individual liberty ??
Greenspan no doubt understands the moral case, given his Randian background. But after years spent overseeing and legitimizing the welfare state by means of central bank fiscal policy and currency manipulation, would he be credible ??
'Scuse the rant.
Welcome back Ari ol'chap ... I see you quickly got back into form.
THX-1138
(6/2/99; 19:34:45MDT - Msg ID:7044)
Stock Market Plunge Protection Team
http://www.freerepublic.com/forum/a37553a44271c.htm
Found this nice little link on Eagle Forum.
Says that Clinton has been having Rubin and Greenspan prop the market up everytime it drops, by buying S&P futures.
One of the respondents has suggested that the money used to do this is probably coming from the Government Thrift Savings Plan. I used to pay into that fund but quit to buy the yellow stuff. Finally moved my money out of the C Fund which is invested in stock and transfered it to the G Fund which is invested in bonds. If I could I would bail all the money out, but I think the only way I could do that would be to use the money to purchase a house. (first time home buyers can do this and get a tax break) If the TSP money has been used to prop the market up the market then I guess I can kiss it good buy. Kind of glad I stopped paying into it.
Golden Truth
(6/2/99; 18:55:06MDT - Msg ID:7043)
Cassius
PPT is an acronym for "Plunge Protection Team" Hope this Helps!
Golden Truth
(6/2/99; 18:31:10MDT - Msg ID:7042)
CoBra(too) The Kosovo Price?
Hello CoBra (too) Check out Mozel's June2/99 :06:30ampost Ties in nicely With GOLD and the U.S Gov's outrageous conduct in the Balkans. Snoop around and get some accounts of the devastation caused by the hospital bombing and a personel account of a Dead 17 year old girl told or seen thru anothers eyes. You Bet!!! Golden Truth
Cassius
(6/2/99; 18:27:09MDT - Msg ID:7041)
SteveH Re:Your post #7038
I think there's something here, but I can't figure out the meaning of PPT. I'm a country boy! Please, what does it mean? Thanks much, Cassius
SteveH
(6/2/99; 18:15:41MDT - Msg ID:7040)
What a bunch of munk!
NYTimes
June 2, 1999
By TIMOTHY PRITCHARD
ORONTO -- The price of gold has fallen to levels unseen in more than 20 years. But
that does not seem to faze Peter Munk, chairman of the Barrick Gold Corp., one of
the world's biggest and most profitable mining companies.
"I'm not a gold bug," Munk said. "I didn't form Barrick because I love gold. To me it was a
fabulous business opportunity." Even in the current market, he said, the company produces
gold for less than half the price it gets, and "to me, that's like paradise."
Munk's appraisal of the gold business has not shifted, even though the price has fallen from
more than $400 an ounce three years ago to $267 late Tuesday. The most recent reason for
the decline is the announcement by Britain last month that it would sell half its gold reserves,
aggravating oversupply fears.
Certainly, higher prices would make Barrick even more profitable. But it is now "the most
profitable gold company in the world," Munk said. So his concerns are not those of the
world's gold traders and speculators.
Munk, 71, has been involved in other businesses -- stereo manufacturing, hotels in the South
Seas, oil and gas -- with mixed results. But he has done exceptionally well with Barrick,
which he helped establish in 1983. Today it mines gold in Ontario and Quebec provinces as
well as in Nevada, Peru and Chile.
Last year, the company earned a record $301 million on revenue of $1.3 billion, even though
the average spot price for an ounce of gold was $294 in 1998, down from $332 in 1997.
Barrick fared well for three reasons. It mined 5 percent more gold, lowered its operating
costs by 12 percent to $160 an ounce, and sold its output for an average price of $400 an
ounce by hedging -- selling gold it had not yet produced.
Not one ounce of gold Barrick has mined has ever been sold for the market price. Working
with investment bankers, it sells contracts for future delivery and invests the proceeds from
those transactions in high-quality securities. After commissions are paid, Barrick records the
gains from its investments as part of the selling price for gold.
So while the price of bullion has been falling hard, Barrick stock has held up quite well. On
Tuesday, Barrick shares traded on the New York Stock Exchange fell 31.25 cents to
$16.9375, well within their 52-week range of $12.875 to $23.625.
Several precious-metals analysts expect Barrick's profit to keep rising because the company
is less reliant on high-cost mines and is expanding low-cost operations. In a recent report,
HSBC Securities in Toronto said it expected Barrick's profit to rise to $334 million, even
though its average selling price for an ounce of gold is projected to fall roughly 4 percent, to
$385.
During a recent and rare interview in Toronto, Munk described Britain's proposed sale over
two years of 415 metric tons of gold, or 913,000 pounds, as a relatively small quantity that
had provoked a knee-jerk reaction. "There is nothing that this market can come up with in
terms of bad news that has not been totally digested by the main holders," he said.
Unlike longtime gold bugs who fret about the vulnerability that has settled around gold,
making it no different from other commodities, Munk said he thought the price of bullion had
been amazingly strong. Had he been asked 10 years ago what sales from reserves by
governments would do to the price, "I would have said it would have been between $40 and
$50" an ounce.
But this degree of price resilience in the face of bad news, he maintained, "really proves that
gold has a fundamental balance of value as a commodity that is supported by healthy demand
that is created by the world's population getting wealthier."
Nonetheless, there are reasons why the world commodity price of gold is languishing. Other
experts point out that gold no longer plays a key role in world financial markets or as a hedge
in investment portfolios. Moreover, some of the biggest owners of gold are selling. Central
banks in six countries -- Canada, Australia, Belgium, the Netherlands, Argentina and the
Czech Republic -- have already sold bullion from their reserves. Joining Britain will be
Switzerland, selling more than 1,000 tons. The International Monetary Fund may also
become a seller.
The new European Central Bank has determined that its member countries will commit gold
for 15 percent of the reserves backing the euro currency. But according to the Gold Survey
for 1999, published by Gold Fields Mineral Services Ltd. of London, three countries have
considerably more gold -- Germany, with 32 percent of its reserves in bullion, France with
40 percent and Italy with 45 percent.
The possibility that chunks of these holdings, totaling 10,000 metric tons, will spill into a
market with total annual demand just over 4,000 tons worries speculators. The United States
has more than 8,000 metric tons, according to the Gold Survey.
Other forces at work in the financial markets are hurting gold.
One has been the lending of gold by central bankers to hedge funds, which have sold into the
market with the hope of repaying the banks later with cheaper bars. Interest on this lending is
a source of revenue for the central banks. The other has been distress selling within battered
Asian economies, which led to a large increase in what is known in the industry as scrap
supplies. Last year, scrap rose 70 percent to almost 1,000 tons, Gold Fields said.
Munk expressed belief that the gold market would absorb the central bank sales without
much disruption as long as the bankers make their intentions clear.
"Once you have transparency, the market is large enough," he said. "The gold market is as
liquid as for any currency."
Absorbing central bank sales may take time. But the annual demand for gold has been
slightly above 4,000 metric tons for the last few years, while new supplies from mines have
totaled about 2,500 metric tons. Low prices have taken some high-cost mines out of
production.
Munk acknowledged that few rich people now hoard gold bars to protect themselves against
economic uncertainty -- they prefer U.S. government bonds. But, he said, the impact has
been offset by new wealth that economic growth is creating not just in North America and
Europe but also in such countries as India, China and Turkey.
"The explosion of the consumer pool, the trillions of dollars of wealth created by the stock
market -- all that just increases a constantly growing fundamental demand," he said. "And it
has nothing to do with people who 15 years ago bought gold because they believed in the
doomsday of the financial world, like my grandfather did."
SteveH
(6/2/99; 18:04:03MDT - Msg ID:7039)
SteveH not equal to SteveIS
SteveIS post is from kitco and is not me. Just a good message.
Look at this (good thing computers exist, how else could they track all this? Y2K...hmmm!):
BANK FOR INTERNATIONAL SETTLEMENTS
CH-4002 BASLE, SWITZERLAND
Press release Press enquiries: +41 61 / 280 81 88
Ref. No.: 22/1999E
2 June 1999
The global OTC derivatives market at end-December 1998
The BIS is releasing today for end-December 1998 the second set of semiannual statistics on positions in the global over-the-counter (OTC) derivatives market under the new regular reporting framework. The statistics include the notional amounts and gross market values outstanding of the worldwide consolidated OTC derivatives exposure of major banks and dealers in the G10 countries1. They cover the four main categories of market risk: foreign exchange, interest rate, equity and commodity2.
After adjustment for double-counting resulting from positions between reporting institutions, the total estimated notional amount of outstanding OTC contracts stood at $80 trillion at end-December 1998, an 11% increase over the revised $72 trillion reported for end-June 1998. This expansion led to a rise in the market share of OTC derivative instruments relative to those traded on exchanges (from 84% to 86% - see Table 1)3.
A strong increase in interest rate and equity-linked contracts (18% and 17% respectively) more than offset the decline in foreign exchange and commodity contracts (by 4% and 8% respectively). Interest rate instruments thus remained by far the largest component of the OTC market (72%), followed by foreign exchange products (26%) and those based on equities and commodities (with 2% and 0.6% respectively).
Much of the expansion in business over the review period can be attributed to the financial turbulence that followed the Russian debt moratorium and the near-collapse of LTCM. This was particularly true in the interest rate segment, where the widespread unwinding of leveraged positions led to an upsurge in interest rate swaps. The increase in interest rate contracts was particularly pronounced in the Deutsche mark (42%), yen (36%) and Swiss franc (25%) segments. While this reflected the ongoing development of derivatives markets outside North America, in the case of the mark it may have been related to the growing benchmark role of German instruments. The financial turbulence of the second half of 1998 also appears to have had an impact on the sectoral distribution of activity, with a notable concentration of interest rate business within the group of reporting dealers (rising from 43% to 49%).
In the area of equity contracts, the sharp drop of equity markets prompted investors to seek protection, leading to a significant increase in related options. There was, however, a marked contrast between the various regions, with positions held on European and Japanese equities rising strongly and those on North American stocks dropping sharply. While European business appears to have benefited from the growing popularity of retail-targeted investment products, Japanese activity probably received support from the liberalisation and legal clarification of OTC trading. The drop in US and emerging market transactions seems to have been related to the cutback in leveraged transactions, since much of the reduction was in business with non-reporting financial institutions.
In contrast, the sharp swings seen in the major currency pairs in the second half of 1998 do not seem to have been associated with a higher volume of open positions in currency instruments. Indeed, while currency contracts were stable overall, there was a major drop in the options segment. The reduced demand for such products has been attributed to a number of factors, including the withdrawal of leveraged investors in the wake of the Russian moratorium and the near-collapse of LTCM, the stability of European cross rates and a reluctance of investors to deal in emerging market currencies. Moreover, the sudden weakness of the dollar was associated with a substantial increase in market volatility, which made intermediaries reluctant to take positions and pushed up hedging costs for customers (as seen in the reduced stock of contracts held by non-financial customers).
The various market segments continued to demonstrate a number of idiosyncracies. Thus, while there was a rise in the average maturity of interest rate contracts (with 36% maturing within one year compared with 41% at end-June - see Table 3), the share of short-term currency-related contracts increased further (from 87% to 88%). Furthermore, the dollar was the counterpart to 88% of foreign exchange transactions, but only to 28% of interest-rate-related positions.
There was a 25% increase in estimated gross market values in the second half of 1998, to $3.2 trillion. However, taking into consideration the increase in the overall stock of transactions, the rise in market values was less significant, from 3.6% to 4% of reported notional amounts. It should be stressed that such values exaggerate actual credit exposure, since they exclude netting and other risk reducing arrangements. Allowing for netting, the increase in the derivatives-related credit exposure of reporting institutions was much smaller, rising by $0.1 trillion to $1.3 trillion (or to 12% of on-balance sheet international banking assets). The ratio of gross market values to notional amounts varied considerably across individual market segments, ranging from less than 1% for FRAs to 30% for equity-linked forwards and swaps.
--------------------------------------------------------------------------------
1The notional amount, which is generally used as a reference to calculate cash flows under individual contracts, provides a comparison of market size between related cash and derivatives markets. Gross market value is defined as the sum (in absolute terms) of the positive market value of all reporters' contracts and the negative market value of their contracts with non-reporters (as a proxy for the positive market value of non-reporters' positions). It measures the replacement cost of all outstanding contracts had they been settled on 31 December 1998.
2It should be noted that the development of sophisticated trading strategies, the expansion of cross-market linkages and regulatory arbitrage have made it more difficult to interpret the evolution of individual market risk categories.
3The closing-out or modification of existing OTC positions generally results in the creation of new counterparty relationships, whereas most exchange-traded positions can be unwound through opposite contracts and are in most instances reversed before contract expiry. It should also be noted that non-financial contracts and options on single equities are excluded from the BIS data on exchange-traded activity.
SteveH
(6/2/99; 17:44:39MDT - Msg ID:7038)
August gold now...
$267.10.
Date: Wed Jun 02 1999 17:19
SteveIS (Euro vs. Dollar) ID#286353:
Copyright © 1999 SteveIS/Kitco Inc. All rights reserved
Volker said that the whole world economy depends on amazon.bomb. Amazon depends on the PPT. The PPT depends on gold leasing for their rescue missions.
Neither Europe nor Japan nor China will endanger the PPT operations. They will prepare for the inevitable failure by buying gold. But not in a way to upset the market. The idea of ANOTHER that the EURO would challenge the dollar is simplistic. The Europeans are happy to have our economy support theirs. They are happy to let us spend our money defending them. They are happy to buy gold cheaply.
They fear a disaster in our financial markets however. After the disaster gold will be necessary to clean up the mess. Meanwhile no world governments want to rock the boat. Rubins goons have free reign to bloody gold.
Smell blood?
Be a shark. Snap it up!
Namaste'
beesting
(6/2/99; 16:49:55MDT - Msg ID:7037)
A different way of measuring the current worth of paper currency.
http://quote.yahoo.com/m5?a=1&s=XAU&t=EUR
At 10:30 A M (New York time) it took 257.62 Euro's to buy one ounce of Gold at world spot price.See above URL.
If Mr.FOA's analysis for the future turns out to be correct, in the long term, we all should get used to pricing Gold in Euro's.
Now, since the introduction of the Euro it has been valued in relation ship to the dollar.A paper fiat currency.
All paper fiat currencies flucuate wildly in relation to each other,because of(you name it,political reasons,economic turmoil,wars,financial manipulation,press releases,and many more reasons)Gold remains Gold no matter who got elected,who bombed who,or who's economy changes radically.
When you value the Euro to Gold(real money), instead of the dollar, since its inception'see what it has done.I don't have charts available to do this but some-body out there may.
So,despite all the negative news about the Euro it still took more dollars(about $266) to buy an ounce of Gold than it did Euro's.(257.62) Therefore we can conclude of the two currencies the Euro is the strongest in relation to purchase of Gold at present.
In other local news,went to town today and did my part to create a shortage in Gold.(bought physical)Local coin shop said no unusual volume in sales today,the locals think the price is going lower.
Ran into an old friend whose family used to own a Gold mine, but since lost it,and she related'some locals had recently donated a 9 OUNCE nugget,to the local museum,found many years ago not too far away.
There's still Gold in them thar hills.........beesting
CoBra(too)
(6/2/99; 16:06:17MDT - Msg ID:7036)
Delta Hedging...
Seeing all those beautifully construed hedging facilities - after all, one of the Black-Sholes noble laureats, winning his hard earned price by placing his mathematically correct rocket scientific (equations) or is it bets based on delta option theories - even the Greek alphabet allows for 24 letters, so how about "omega options/" - was in need of the first in history bail out of a 'hedge fund" called Long Term Capital Mismanegement(name implying insurance towards the vagaries of "off"-markets).
LTCM, the former cheer leader of the gang(-sters)completely misinterpreted the term "hedging" and the the new era technical translation of the day became known as leveraging, which again is a future bet, equivalent to the state lottery. But there is one distinct difference. While the state lottery strives by taxing the herd of unsuspecting happy sheep, the hedge funds invented the economical method of taxing the (greedy) banking establishment, or the shepherds of the new derivative way - akin to greenmail - where there is no escape outside of systemic risk - hence the necessity of PPT - and now the necessity of providing insurance against counterparty risk (an euphemism of an 80 trillion $ derivative, overleveraged, carry trade risk of the banking community? of mostly 10 (et al bullion) banks.
Euro currency may have been the catalyst to put the brakes to the total and global dollarization, for the short term, while gold will be the Alpha to Omega to put the $-printing press of ever more IOU's to rest and test.
$265/oz of AU - make you some more ....
Golden Truth
(6/2/99; 16:03:15MDT - Msg ID:7035)
Gold For Silver?
I've come to the conclusion that GOLD can't drop any lower than the price of SILVER. Which at that time i will trade or swap all my 2KG for 2KG of Gold. If i,am really smart i'll probabably wait until the buyers of "puts" drive the price down to $1/oz, before i swap over. That way i can make a 400% profit and take home 10kgs of Gold for my 2kgs of Siver. Now just imagine if Silver rallies and doubles in price,the upside potential is fantastic. Yes folks i know your probabably saying why not wait until it goes lower than a $buck. All i can say is i guess i,am just not that greedy unlike our paper shorting @#%&*(()!~ buddies. Now get out there and buy some Silver i have,nt lost any money on it since i bought it. Which was the same time i've purchased Gold and since have lost $20/oz US. REMEMBER folks the once in a lifetime (millenium)deal to trade Silver for Gold only comes once every thousand years. I can honestly say i'll be quite happy not to be here for it next time either. On a more serious vein there definitely seems to be a two teir market our so i,am lead to believe. It absolutely bewilders me how Gold can be the at a 1979 $price in 1999? When you can not buy a house today at a 1979 price even if the dollar is at 1999 high, which to me means that a house should be cheaper. Also we know that the dollar today has lost most of its purchasing power so that if you compared what $100 in 1979 bought compared to what $100 in 1999 bought you would see a BIG BIG diference?? Iwould say it would be equivalent to buying an oz of gold at $265 in 1979 to an oz of gold costing $2650 dollars in 1999. What the Hell is going on? are all the currencies of the World being destroyed that people from other parts of the World can no longer afford to buy Gold no matter what the price is. Due to the fact that no matter how low Gold goes their currencies go lower? If that is truley what is going on WOE WOE to the World for ther will be a DEPRESSION this Planet has never seen the like of before. ANY PRUDENT COMMENTS WELCOME!!! ( I Smell Fear!) Golden Truth
Aristotle
(6/2/99; 16:02:38MDT - Msg ID:7034)
Hey Quixote, great parable!
I wonder how many of the passengers actually recieved their two parachutes, and how many had nothing but tickets to flap as the plane went nose down?
Keep 'em coming!
Golden parachute. Get you one. ---Aristotle
Quixote
(6/2/99; 14:57:06MDT - Msg ID:7033)
a parable
a stock broker and a gold heart were crossing the atlantic in an airplane. halfway through the flight, the co-pilot announced that there was a problem. "the plane only has one hour of fuel left, and we're still two hours from the coast." he admitted, but then continued. "not to worry, this is a small airplane and we carry enough parachutes for all our passengers. we will fly as far as we can and then jump when the plane runs out of fuel". he then proceeded to the back of the plane and began to hand out the parachutes, but was interrupted by the stock broker.
"hold on! there's no need to hand out the parachutes yet." insisted the broker. "we still have an hour of fuel left, and there's no need for us to sit here holding bulky parachutes. if we hold onto our tickets, you can exchange them for parachutes when the time comes."
"what!" the gold heart exclaimed. "i want my parachute now!" but he was not heard over the commotion as the passengers frantically searched their belongings for their tickets. concerned, he struggled to the back of the plane and convinced a stewardess to trade him a parachute for his ticket. he then returned to his seat and waited.
as the plane flew on, the co-pilot counted the parachutes, did some quick math, and announced "two parachutes are now available for each remaining ticket holder."
"the remainder of us will each have a reserve chute." boasted the stock broker to the gold heart.
after an hour the plane engine sputtered and died. the passengers rushed to the back of the plane where the co-pilot began handing each passenger two parachutes. at the back of the line, the broker saw the gold heart headed for the open door with his single parachute. "don't you wish you'd waited to exchange your ticket until the co-pilot had counted the parachutes?" he asked.
"no." replied the gold heart as he stepped into the doorway. "the co-pilot's the one who fueled the plane."
TownCrier
(6/2/99; 14:48:41MDT - Msg ID:7032)
Tea leaves for the day
http://biz.yahoo.com/rf/990602/7b.html
Most IMM currencies, led by euros, end sharply lower
Technician
(6/2/99; 14:47:29MDT - Msg ID:7031)
Buy more gold coins, not futures
http://www.homestead.com/purifoysfutures/purifoy.html
We goldbugs have a lot of competition. Higher interest rates, a stock market which is not so dead, yet, and an incredibly (for time being) strong $. Dollar average bullion coins until the moment arrives for derivatives. By the way my purchase of Durban deep yesterday hasn't budged. Still 1 7/8 last I looked. All this touting on Eagle, USA and KITCO (what happend to KITCO?) just to get me to help support the price or is it for real? By the way, if you visit my web site, try the zip code weather channel. One of best I have seen with local doppler..every thing. Keep the faith!!! Gold looks a lot better in just about any other currency.
TownCrier
(6/2/99; 14:04:49MDT - Msg ID:7030)
Echoes of the Fifth Horseman...news of rising oil
London--Jun 2--1229 ET--Saudi Arabia is confident OPEC members were in
full compliance with oil cut pledges in May, a Saudi official said. The
official also said Saudi strategists still expected oil prices to rise in
the "next few weeks" as reduced oil supply affects the market. By Mona
Megalli
New York--Jun 1--Based on the significant decline in oil export loadings
to 20.935 million bpd in the first 2 weeks of May from 21.36 million bpd
in April, OPEC countries are continuing to make strides towards reducing
output, according to tanker tracking data. Forward tanker charter data
also reveals the downward trend in OPEC exports is likely to continue
through June. By Karyn Peterson and Carola Hoyos
Tallinn--Jun 2--1021 ET--Latvian oil terminal operator Ventspils Nafta's
total loaded crude oil and products in May fell 4.5% to 1.924 million
tonnes, from 2.015 million tonnes in April. By David Mardiste
New York--Jun 2--1017 ET--Iraq exported an average of 2.44 million bpd of
crude oil in the week to Friday under the UN's oil-for-food deal, compared
with 2.2 million bpd in the previous week, according to a UN report. The
higher-than-usual export volume came during the week Iraq and the UN
agreed to extend the oil-for-food deal for another 6-month round. By
Carola Hoyos
London--Jun 2--0659 ET--OPEC is likely to agree to extend the oil
output-cuts package that came into effect Apr 1 to support oil prices, an
OPEC official said.
The comment comes amid words of caution from Venezuela's Oil Minister Ali
Rodriguez, who said on Friday that it was too soon to consider such
action. By Alex Lawler
(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
(6/2/99; 13:54:35MDT - Msg ID:7029)
NY Precious Metals Review: Aug gold dn $2.4, still pressured
By Melanie Lovatt, Bridge News
New York--Jun 2--COMEX Aug gold futures settled down $2.40 at $267.10
per ounce after revisiting Tuesday's $267 contract low. Traders said that
the market remains beset by bearish sentiment, following its move Tuesday
to yet another fresh 20-year low on nearby continuous charts. While some
of today's selling pressure was tied to options activity, the market as a
whole was subdued.
One trader noted that the buying of Jly puts at $260 had helped
selling and shows that the outlook is still negative.
Leonard Kaplan, chief bullion dealer at LFG Bullion Services in
Chicago noted that put options are also clustered at the $265 level. "The
closer we get to $265, the more accelerated the move will be due to delta
hedging," he noted.
"It's not easy to stand in front of a runaway train." However, he
suggested that today's price slide was due "more to a lack of buying" than
"big selling pressure."
He noted that this is understandable, given that the news remains
bearish with gold's fall to 20-year lows "not a psychological highpoint."
He said that many feel they have no need to buy ahead of the UK
Treasury's first gold auction set for Jly 6.
However, the first two to three UK Treasury gold sales could be the
key to a turnaround in the gold price, said Kjeld Thygesen, managing
director of the UK's Lion Resource Management Ltd. and advisor to the
Midas Fund. "If the first two to three auctions go well and are
oversubscribed, this may be the bottom of the market," he said.
Tony Caen, senior precious metals dealer at Credit Lyonnais Rouse,
said that "volume seems to be tailing off as people figure how to trade at
life of contract lows."
"People are only trading gold when they really have to do something,"
he said.
(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
(6/2/99; 13:46:09MDT - Msg ID:7028)
Hear ye! Hear ye!
http://www.usagold.com/wgc.html
THIS WEEK IN GOLD has now been updated!
Follow the link above to view gold market commentary from World Gold Council staff for the past week (May 24 - May 28, 1999). It looks like the people of India will be "making gold" this year. Let's join in!
CoBra(too)
(6/2/99; 12:23:42MDT - Msg ID:7027)
The Kosovo price?
@ Golden Truth Msg. 6999 & Jinx44 Msg. 7002
I do know about the Trepka & Stari complex (chrome, zink, copper & lead), as I know about huge copper/gold mines and huge potential in Albania itself. Both complexes are poly-metallic and, yes, potentially huge, with even some PGM-potential in their ultramafic layered geology.
Having been in mining finance for a long time I'm always wary of multibillion (trillion) $ deposits or deals. I must admit, I'm not aware of the Greek deal and frankly, I feel that noone ever would consider, or would come close to the financial means of backing such a megabucks deal.
Living close to the Balkan's, where some in this country sarcastically feel it's beginning right before the SE border of our capital - fortunately my place is located west of the place - I have been whitness to the misery of ethnic cleansing of former Yugoslavia. Starting with Slovenia, which did not work out, but even some of our border towns were affected. Croatia was already a major struggle, Bosnia-Herzegowina is still not settled in reality and the Dayton settlements do not work, since they did nothing to factor the centuries of ethnic hate into the "truce", like Croatian Ustascha's vs Serbian Chetnik's becoming the ultimate of brutality, or even bestiality during WWII.
Kosovo, is the historical battleground, where the Serbian nobility rallied around their king at the famous battle of the "Amselfeld" in 1389 and ended with the complete subjugation of Serbia under Turk(ish)Rule for centuries. The dream of greater Serbian kingdom is older than the millenium. It always stayed a dream.
Slobodan Milosevic is hopefully the last of the Balkan tyrants to dream this impossible dream - and he is responsible for several hundred thousands victims and millions of displaced refugees. (In WWI the Austrian Emperor , Franz Joseph,was qouted: "Serbien muss sterbien" -Serbia has to be eliminated)
In view of the ongoing ethnic cleansing and the resulting slaughterhouse it is time to stop this madman, though I agree it is a European problem. Europe, almost 55 years after the devastating war is, at this time not ready to (politically)shape its own fate, but working on it.
As we can see the US PPT (plunge protection team) is recalling every favor , once granted to keep up the rest of us to finance the (paper) asset bubble - and at this stage global consensus is leaning in the direction of complying, since alternate scenarios are spelling doom (systemic risk?), we may not want to risk.
That is part of my believe in the l.t. success of the euro currency and of the l.t. proven qualities of gold as the only historical medium of fair exchange, barter or more to the point valuation of reality. While hoping, together with AG, RR and the rest of PPT, for a soft landing solution, I have given up hope in view of the uncontrolled (hedge) monsters now dictating, where the global economic, currency and human capital is headed. - YOU BET! -
(I disassociate myself from any typos, this message is unrevised-) Regards CoBra2
TownCrier
(6/2/99; 12:18:56MDT - Msg ID:7026)
Gold news you can use
Karachi--Jun 2--World gold prices have hit bottom and begun to stabilize,
providing a good opportunity for buyers, according to a senior official of the
World Gold Council. By Fakhr Ahmad
Tokyo--Jun 2--In the wake of overnight fears of a crash in US stocks, the US
dollar traded almost flat against other majors today as players remain wary of
the US Federal Reserve's next move and its possible impact on US markets. By
Rika Yamamoto
Hong Kong--June 2--China's gold consumption is expected to rise after the
People's Bank of China, the central bank, cut purchase and sales prices of
the metal last week, the official China Daily reported today. PBOC cut the
purchasing price of gold by 7.4% per gram last week, it said. The paper did
not provide current purchase and sales prices of gold. Bridge News
Reprinted at USAGOLD with permission. For details please go to:
http://www.crbindex.com/
No further reproduction without written permission
TownCrier
(6/2/99; 12:09:14MDT - Msg ID:7025)
Rate Fears Ratchet Up the Pressure on Net Stocks
http://www.thestreet.com/markets/middaymusings/752677.html
Summary of stuff that someone thought was worth writing about. Inflationary pressures and what not...
TownCrier
(6/2/99; 12:03:52MDT - Msg ID:7024)
Bonds Drop on Home Sales Report
http://www.thestreet.com/markets/keynumbers/752703.html
The bond market is running scared...
TownCrier
(6/2/99; 11:57:16MDT - Msg ID:7023)
More euro news you can use
http://news.bbc.co.uk/hi/english/events/the_launch_of_emu/euro_latest/newsid_358000/358675.stm
"The euro is a currency firmly based on internal price stability and therefore has a clear potential for a stronger external value," and the ECB will refrain from a currency intervention.
The former Italian prime minister said, "I think we will have a strong euro in the future because there will be the conditions for this to happen."
TownCrier
(6/2/99; 11:42:01MDT - Msg ID:7022)
Euro Sinks to Record Low, Duisenberg offers comments
http://biz.yahoo.com/apf/990602/germany_eu_2.html
"I'm inclined to play down short-term volatility moves in the exchange rate," he said after the bank's regular biweekly meeting. "In the long run, I see more factors pointing at an appreciation of the euro than at a depreciation of the euro."
Also said that Italy was within the rules, and that any weakening of the adopted strict fiscal/budgetary criteria "would be a real reason for concern" for the euro.
That makes it sound distinctly different than the dollar, doesn't it?
TownCrier
(6/2/99; 11:31:53MDT - Msg ID:7021)
Sales of New Homes Up 9.2 Percent
http://biz.yahoo.com/apf/990602/economy_2.html
April single-family home sales jump 9.2 pct from March to seasonally adjusted 978,000, far exceeding the 890,000 forecast. It is the second highest level on record.
TownCrier
(6/2/99; 11:22:03MDT - Msg ID:7020)
Greenspan mum on U.S. rates, warns on free trade
http://biz.yahoo.com/rf/990602/ze.html
"We try to promote free trade on the mistaken ground that it will create jobs. The reason should be that it enhances standards of living through the effects of competition on productivity." -----FRB Chairman Alan Greenspan
USAGOLD
(6/2/99; 8:22:54MDT - Msg ID:7019)
Today's Gold Report: Gold Hovers, Euro Record Low, Dollar Nears 1990s High
MARKET REPORT(6/2/99): Gold hovered near yesterday's levels as the dollar
strengthened against most currencies, but most notably the euro which fell below $1.04 and
set a new lifetime low. Reuters reports this morning that European Central Bank (ECB)
president Wim Duisenberg "failed to throw the euro a lifeline." Interventions decoupled
from strong economic policies usually have a short term effect on the market and the ECB is
attempting to send a message that is more interested in the medium to long term with respect
to the currency, as a opposed to a quick fix. In lieu of all this the dollar is approaching its
high against most currencies for the 1990s. Gold broke to the $266 level in Asian trading
overnight but then recovered in Europe on "modest" short covering. The Reuters London
report quotes one Australian security analyst as saying that he didn't think Australian mines
would be shutting down unless the price went to $260 -- an assurance that had more than
one mine company shareholder blink and re-read the statement to make sure it was
understood properly.
There has been quite a bit written on the Bank of England (BOE) sale and we won't belabor
what has become a well-studied event, but we just had to pass along this short analysis
from the Standard Bank of London: "The UK announced its decision to sell more than 400
tons of its gold reserves on May 7th and have subsequently explained the move as simply a
portfolio investment decision, looking to shift into higher yielding assets. Since then gold
has fallen almost 8.50% in less than a month and they have not yet sold an ounce. Not very
clever!" I'll second that.
In other gold news, Bridge News reports a senior official at the World Gold Council as
saying that "World gold prices have hit bottom and begun to stabilize, providing a good
opportunity for buyers." Bridge also reports strong buying in China as the People's Bank
of China cut prices by 7.4% last week.
That's it for today, fellow goldmeisters. More later if anything crops up.
The featured article in this month's News & Views centers on government finance in an
article entitled "The Financial State of the Union." I'm sure it contains many
surprises for our readers. There is a great deal of difference between what our government
leaders are telling us and the reality with respect to the government's books. This issue is
one or our best and most informative. Please go to our ORDER FORM or call Marie at
1-800-869-5115 for a Free Copy of News & Views -- our widely read monthly newsletter
-- and introductory packet on gold ownership.
Peter Asher
(6/2/99; 7:13:39MDT - Msg ID:7018)
Cavan Man
http://news.excite.com/news/r/990602/05/business-markets-europe
Regarding your posts <I cannot comment on the EU. I do not have the knowledge to give an opinion. Having travailed a bit internationally and having reached the conclusion from my travels abroad that "humanity" shares many common threads, I want to assume the EU has similar problems across the board.> And, <Mr Asher: I love this country dearly but the signs (of problems) are everywhere.> (Which were in answer to my #6941 of 5/31 "Dollar-Euro")
The above URL may shed some light.
Excerpt -- "There is little doubt that the dollar has got problems but the euro
has got even bigger problems," said David Bloom, currency
strategist at HSBC Markets in London.
Peter Asher
(6/2/99; 6:49:32MDT - Msg ID:7017)
Geezer
Acoding to what you say, the sale of IMF gold for the purpose of relieving poor nations of debt,would have made him a staunch advocate. Actually he appears to be the antithises of a socialist. "It is not the place of Government to create job's, that is for the private sector to do". "The problem facing most Issues today is that each of several opposing groups has just enough power to stop things, creating political gridlock."
SteveH
(6/2/99; 5:23:40MDT - Msg ID:7016)
August gold now...
$268.40.
Oregon Geezer
(6/2/99; 2:56:13MDT - Msg ID:7015)
Peter Asher's message #7008
You sounded a little surprised that Sen. Ron "The Weasel" Wyden did not know about any possible selling of IMF gold. For decades I have lived in The Weasel's district when he was in the House of Reps. Getting some rational thoughts through to him from a conservative perspective is like pushing a rhino through the cat door. He's a dyed in the wool socialist and so he would not give a damn about the selling and buying of gold no matter the consequences unless that activity would benefit the poor, children, hobos, bums or other targets of "compassion." I wrote him off a long time ago.
Aristotle
(6/2/99; 0:39:17MDT - Msg ID:7014)
The possession of Gold has ruined fewer men than the lack of it. --Thomas Bailey Aldrich
It is extraordinary how many emotional storms one may weather in safety if one is ballasted with ever so little Gold. --William McFee (1881-1902)
Like liberty, Gold never stays where it is undervalued. --J.S. Morill (1810-1898)
There can be no doubt that the international Gold standard, as it evolved in the nineteenth century, provided the growing industrial world with the most efficient system of adjustments for balance of payments which it was ever to have, either by accident or by conscious planning. --W.M. Scammell (1920-)
Truth must be ground for every man by himself out of its husk, with such help as he can get, indeed, but not without stern labor of his own. --John Ruskin
Though wisdom cannot be gotten for Gold, still less can be gotten without it. --Samuel Butler (1835-1902)
Gold opens all locks, no lock will hold against the power of Gold. --George Herbert (1593-1633)
Gold is pale because it has so many thieves plotting against it. --Diogenes (412-323 B.C.)
[thanks to MK for these quotes which were gathered in his ABC's of Gold Investing book. And thanks, also, for this month's newsletter...though I can't believe you found the stomach to quote J.M. Keynes in the header, even though the sentiment expressed was appropriate. But C'mon, MK...Keynes?? Will Rogers never met him, I'm sure of it.]
Gold. Get you some. ---Aristotle (1999)
Aristotle
(6/2/99; 0:06:43MDT - Msg ID:7013)
Read this link. You will know EXACTLY why Gold is your friend, even when its value is obtainable with fewer dollars.
http://www.wired.com/news/news/culture/story/19942.html
Excerpt from an article that documents the hell that some tech stock owners are feeling:
For people in option limbo, the theory goes, dips in the market become emotional catastrophes. In the age of the day trader, when stocks can soar and fall dozens of points on innuendo alone, any given day can be a disaster.
"People come in, and they're suffering so much from the anxiety of it all they can't even work," says Stephen Goldbart, a clinical psychologist.
When a company's stock flames out for good, it leaves behind charred souls.
"There are all these fantasies about the good life, a life most of these people have never lived, and suddenly it's taken away," says Goldbart. "They get frozen and numb around issues of money. It's almost like post-traumatic stress disorder." [click the link and read it all...quite pathetic, actually. Poor saps. I've never heard a tale of a Gold coin going bankrupt, particularly during the worst of times. Why fret your life away? Sheeeesh.]
----------------------
And think about this element, also. As surprising as these downward movements are, it should not be difficult for any reasonable mind to conclude that any and all of these Gold price movements (including any future surprises) could as easily be to the upside.
Review the fundamentals.
All evidence suggests that the dollar's strength is on borrowed time. While it is taking a bit of a scenic route to get there, the 30-year bond is heading south. The dollar is truly a castle built in the sky. When it falls, so will the purchasing power of all cash savings. Gold is safe. Gold is real.
Sure, the argument could be made in HINDSIGHT that a person would have been better off to hold on to his life's accumulated cash savings, to swap for Gold not one moment prior to these current prices; but then again, who knows IN REAL TIME which direction the next move will be? As I offered, it could have been UP just as easily. We'll get there, and with far more Gold than the late-comers! And in the meanwhile, isn't it true that we are not on emotional pins and needles to the extent of those tech stock traders? Isn't the right life a wonderful one indeed? Just like good ol' Aragorn, call me "Mr. Serenity."
Sir Golden Truth asked, "Who is buying the Gold???" Well, I can assure you now that my bills have been paid for the month, I AM! With a constant salary, and fairly constant expenses, this could turn out to be my heaviest "paycheck" yet, with the latest Gold/dollar exchange rate giving me a de facto raise in my metal salary! You can make paper money, or you can make Gold money. Now more than ever, the choice is an obvious one.
Gold. Make you some. ---Aristotle
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