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ARCHIVED DISCUSSION FROM 1/2/2007 All times are U.S. Mountain Time (Yesterday's Discussion.) Topaz (1/2/07; 22:37:38MT - usagold.com msg#: 150660) Gold-v-Silver. http://stockcharts.com/h-sc/ui?s=$GOLD:$SILVER&p=D&st=1990-01-01&en=2006-12-23&id=p44105871339 They really are two different types of "investment" and I hold both for differing reasons.The "dollar" Gold: "dollar" Silver ratio chart indicates $Silver is rapidly advancing on $Gold as the ratio descends ...you can structure your acquisitions accordingly via the RSI and be ahead of the curve imo.This is not to be confused with a Gold:Silver ratio though and only a shift in, or awareness of their use value as money will "suddenly and spontaneously" pull that little genie out of the hat! mikal (1/2/07; 21:54:53MT - usagold.com msg#: 150659) @Sierra Madre Good points. Also, regarding "One false move in foreign policy could provide the trigger", I was reminded of just that today as there was a long, purposefully lame article out titled(I may be paraphrasing) "Hot Spots in 2007", which, despite much sterilizing, was hardly encouraging,proposed zilch solutions and represented that wewould not even get a "world muddling through", with "no resolutions in sight". Funny, isn't this what always happens when spending and inflation starts to get out of hand? Chris Powell (1/2/07; 21:46:23MT - usagold.com msg#: 150658) Fighting over gold in the land of Dracula http://www.nytimes.com/2007/01/03/business/worldbusiness/03gold.html Fighting Over Gold in the Land of Dracula By Craig S. SmithThe New York TimesWednesday, January 3, 2006ROSIA MONTANA, Romania -- Eugen David, a small-time farmer with a chipped tooth and muddy boots in this obscure wrinkle of Transylvania, is an unlikely man to attract the attention of movie stars and moguls. But he counts Vanessa Redgrave, George Soros, and Teddy Goldsmith among his backers in a land battle with a Canadian gold mining company.The company, Gabriel Resources, owns the rights to mine the hills here and wants Mr. David, 41, to leave his 50 acres of land so that the company can carve out what would be Europe's largest open-pit gold mine. Mr. David says he isn't budging."We don't want to move," he says, staring across at the brown-gray stain of Rosia Montana's defunct gold mine, which would be swallowed by Gabriel Resources' huge project.In the old days, a pipsqueak like Mr. David wouldn't stand a chance fighting powerful and sophisticated adversaries like Gabriel Resources and its minority partner, the Romanian government. But this is the Internet age, when local activists like Mr. David can tap into an increasingly well-oiled global network of non-governmental organizations for financial and political support on a long list of causes and emerge with almost as much clout as any corporation. Mr. David's stubbornness has struck a chord with the anti-globalization movement. Gabriel Resources' proposed open-pit, cyanide-leaching mining process has also drawn the ire of international environmentalists who are now trying to stop it.They just might win.Mining is one of the world's most unpopular pursuits these days, particularly the gigantic gouging that leaves the earth pocked with moonscape-like craters a mile or more wide. Gold mining is disdained even more because of the perceived frivolity of its end: to provide lucre for the rich, status for the everyman, and hidden stores of wealth for nations.But it also has a strong allure, particularly for resource-rich countries like Romania that are struggling to develop impoverished communities that need jobs.The $3.7 billion project would plow more than $2 billion into the Romanian economy and could earn Gabriel Resources and its shareholders profits of $1 billion or more. And the company involved here, a Toronto-based corporation with market capitalization of $1 billion, is run by savvy mining executives, many of them highly experienced from cutting their teeth building Barrick Gold Corp., the largest gold mining company in the world. The allure is perhaps stronger in Romania because the country was created, in a way, by gold mining.Early in the second century A.D., Emperor Trajan extended Roman territory to include what is now Transylvania, in the western half of Romania, to mine Europe's most important gold deposits. The mines helped finance the expansion of the empire to its peak. When the Romans abandoned the territory almost 200 years later, they left behind colonists who are the ancestors of Romanians today.When the Romans left, the mining did not stop. The eventual ruling dynasty, the Hapsburgs, and the Communists, who turned to open-pit mining, continued the process, though with dwindling efficiency. The mine was finally shut in early 2006. Gabriel Resources was born in the breakup of the state-owned economy after communism's collapse when Romanian businessmen with little mining experience and suspected ties to the former secret police won a vast concession to exploit mineral deposits.Mr. David and his neighbors realized six years ago that the company planned to expand the old mine and formed an association called Alburnus Maior -- Rosia Montana's Roman name -- to try to stop the project. They were engaged in an ineffective letter-writing campaign when the founders of Gabriel Resources moved the company's listing from Vancouver, British Columbia, to the more respectable Toronto Stock Exchange.Mr. David's opposition might have withered had it not been for an ill-advised plan to build a Dracula theme park near the picturesque Romanian town of Sighisoara, once home to Vlad Dracula, the notorious Romanian ruler and inspiration for "Dracula," the Bram Stoker novel.Prince Charles of Britain, fond of Romania's old Saxon villages, was outraged. So was Teddy Goldsmith, the aging anti-globalist environmentalist and scion of a wealthy business family.A Swiss-born environmental journalist named Stephanie Roth, who wrote for Mr. Goldsmith's magazine, The Ecologist, moved to Romania to help defeat the project. With such powerful forces aligned against it, the theme park for Sighisoara died. While in Romania, Ms. Roth heard about the Gabriel Resources' plan for Rosia Montana and went to meet Mr. David in April 2002. Within months, she had introduced him to some of the most powerful environmental organizations in the world."When I came there was no computer, no Web site," Ms. Roth said. "I tried to empower the local organization."Ms. Roth started by helping Mr. David's group obtain a grant for a few hundred dollars from an American environmental organization, Global Greengrants Fund. They organized a public hearing in Rosia Montana that drew 40 non-governmental organizations with Romanian operations, including Greenpeace, and catapulted Mr. David's dispute onto the national stage.Then Ms. Roth took to the road. By the time Gabriel Resources' founders turned the company over to more professional management in 2005, the company had an international coalition of nongovernmental organizations arrayed against it.But the mining industry doesn't easily back down.Hoping to extract an estimated 300 tons of gold and 1,200 tons of silver from the mine, Gabriel Resources introduced a public relations campaign with Madison Avenue-style television commercials and community sponsorships to win over 960 Rosia Montana families that it needed to relocate. It cast itself as an economic savior. It even countered a critical documentary with its own film, "Mine Your Own Business."Some efforts backfired. Gabriel Resources helped sponsor the Transylvanian International Film Festival in nearby Cluj-Napoca. But when its organizers invited Ms. Redgrave to receive a lifetime achievement award, Ms. Roth quickly put the actress and Mr. David together.Ms. Redgrave's acceptance speech became a rallying cry against Gabriel Resources' project. The anti-Gabriel Resources' movement had its mascot and the European press began covering the story.Word of the movement had by then reached the Open Society Institute of George Soros, which has been working for years for more accountability from Romanian public officials."When guys in SUVs with bags full of cash show up in a poor locality in Romania, they can really make the law there," said Radu Motoc, project director of the Open Society Foundation-Romania.Nearly all members of Rosia Montana's former and current council are either employed by Rosia Montana Gold, Gabriel's local subsidiary, or have family members who are, according to the foundation.The foundation, which has already given $35,000 to the cause, says it plans to spend as much as $240,000 next year fighting the project and helping Mr. David. Because of the polarizing debate surrounding open-pit gold mining, it is hard to find an unbiased commentator to assess the risks and benefits of Gabriel Resources' proposed mine. A major focus of contention is the use of large quantities of highly toxic cyanide to separate gold and silver from the ore.In 1999, Aurul, a joint venture of the Australian mining company, Esmeralda Exploration, and a Romanian national company, Remin, began a leaching operation to recover gold from old tailings in Baia Mare, or Great Mine, roughly 80 miles north of Rosia Montana. Like Gabriel Resources, the company promised a state-of-the-art, self-contained project that would not pose risks to the environment. But less than a year later, the dam holding back a lake of cyanide-laced water burst, sending 100,000 cubic meters of contaminated water downstream to the Danube, killing more than 1,200 tons of fish in Hungary.Gabriel Resources says it would build in safeguards that were missing at Baia Mare. It has promised to convert most of the cyanide into a nontoxic compound before discharging it into the mine's tailing pond. It also promises to clean up pollution left by past mining operations and spend $70 million to do as much as possible to repair the altered landscape after its project is done."Arsenic, cadmium, nickel, lead," said Catalin Hosu, a public relations official for Gabriel Resources, ticking off just a few of the heavy metals that leach from ancient mines to give this valley its name; Rosia Montana means "red mountain.""We help the biodiversity; we help the environment," said Yani Roditis, Gabriel Resources' chief operating officer.That's difficult for many people here to believe. The new project will grind down several hills, leaving four deep pits in their place, and slowly fill an entire valley with wastewater and tailings that will take years to solidify.Robert E. Moran, a mining expert hired by the opposition to evaluate the impact of Gabriel Resources' plans, said that the mine, despite detoxification, would inevitably produce other toxic byproducts damaging to the environment, including heavy metals.The controversy, meanwhile, has splintered the town, its buildings divided between those with signs that read, "Property of Rosia Montana Gold Corp." and others that say, "This Property Is Not For Sale.""I was born here, so why should I leave?" said Gabriela Jorka, 38, who runs a small general store in Rosia Montana. "I'd rather kill myself."Eugen Bobar, 60, the school principal, says that the dispute is pitting parents against children, husbands against wives. But only about 40 percent of the families to be relocated remain, and Mr. Bobar predicts that most of them will leave. "Most of the people who talk about the environment are just making an excuse," Mr. Bobar said, sitting in the school's office late one night. "They will leave for a good price."Mr. David, however, insists there is a committed core of opponents who will not sell, whatever the offer. In that case, Gabriel Resources warns, it may ask the state to step in and move people out by force. But that could lead to years of legal wrangling.The company has told its shareholders that it expects to receive final approval for the project from the Romanian government this year and will start producing gold by mid-2009.Gabriel Resources, which is based in Toronto, is, meanwhile, trying to win over the remaining holdouts. It is sponsoring education for underprivileged children in Rosia Montana through a nongovernmental organization run by Leslie Hawke, the mother of the actor Ethan Hawke and a celebrity herself in Romania. She supports the project."It's probably better that nothing happened, but the gold is there and if they don't do it, somebody else will," Ms. Hawke said. "And I'd rather that they do it than somebody else." Sierra Madre (1/2/07; 21:37:25MT - usagold.com msg#: 150657) MIKAL: ECB Bank bought gold in Dec. 2006 Well, the announcement was downplayed as a possible "technical adjustment" with no significance.I consider this as: "Strike ONE!"Let's watch this interesting game and be on the lookout for further announcements.In my opinion, one more announcement of this nature would constitute Strike TWO.One more after that, Strike THREE, and it will be game over and pandemonium in the gold market. Market psychology: "Shucks, the CB's in Europe are buying gold. They must know something. I better buy some, too." Might happen this year. One false move by the USA in foreign policy may provide the trigger. SIERRA mikal (1/2/07; 20:34:08MT - usagold.com msg#: 150656) Gold bars stack up http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2007/01/03/cngold03.xml Gold Roars After ECB Member Bank Buys | Ambrose Evans-Pritchard | January 3, 2007Go to link to see the ways in which gold barsreally DO stack up... GOLD FINGER (1/2/07; 18:36:53MT - usagold.com msg#: 150655) Die for copper....never...gold maybe!! http://www.usatoday.com/news/nation/2006-09-26-copper-theft_x.htm?csp=34 One more thought.......with the rise in copper and other metals I would expect all premium metals like gold, silver and platinum are still a fantastic buy. I read now almost daily of thieves trying to rip out or rip off wire from construction sights to under ground conductors. I just find it fascinating to what ends some will go to convert something into a fast buck! This tells me a lot. If I could only remember where my dad stashed that bail of copper wire!!GF mikal (1/2/07; 18:11:57MT - usagold.com msg#: 150654) @Flatliner http://www.jsmineset.com James Sinclair uses the same reasoning(as yours) on euro and gold in his early morning commentary today:"Few have recognized the milestone event of the euro meeting and exceeding dollar use. The dollar became the universal reserve currency for two reason.It was the only currency with enough in circulation to settle all world transactions in. The sales force of the US Treasury, the World Bank and the IMF did a good selling job.Now the Euro as the NON-DOLLAR has met and is exceeding the primary reasons the US dollar took the preeminent position. This is just another reason why the US dollar is headed for a very-very hard landing.Regardless, the Euro is just another promise to pay backed by nothing whatsoever. This is when gold becomes the currency of choice by the people and $1650 follows." arbyh (1/2/07; 18:03:52MT - usagold.com msg#: 150653) Greetings and a Happy New Year....we all should hope so. I hope whatever market equalibrium quest to rebalance occurs...I hope it isn't too damn painful!!!! Having gold and silver , or not ...No what I mean? mikal (1/2/07; 18:00:44MT - usagold.com msg#: 150652) @Flatliner http://www.iht.com/articles/2007/01/01/business/euro.php Re: Your msg's on Euro and Euronext. Very goodand useful information. Here is a repost on euro use, circulation etc:Euro Used as Legal Tender in Non-EU Nations The Associated Press - Published: January 1, 2007Excerpt: "BRUSSELS: Slovenia converted to the euro Monday, officially becoming the 13th member of the euro zone — and the first among the newest EU members to qualify to use the currency. But at least half a dozen other European mini-states and territories are using the currency as legal tender — without approval from the European Central Bank.The euro was introduced five years ago to provide economic cohesion among EU countries. But euros also are in circulation in dozens of countries and overseas territories from the North Atlantic to the Pacific.In Europe, Montenegro, Vatican City, San Marino and the principalities of Andorra and Monaco have used the euro since its inception.In the province of Kosovo — administered by the United Nations, but technically still part of Serbia — the euro circulates alongside the Serbian dinar.The European Central Bank has not opposed "unilateral euroization" by mini-states that historically have been linked to the French franc, Spanish peseta or German mark as legal tender."The ECB does not either encourage nor deter third countries from using the euro," the ECB president, Jean-Claude Trichet, said recently.Joaqu'n Almunia, the EU economic and monetary affairs commissioner, has encouraged nations to adopt the euro as a means of achieving economic stability. "The adoption of the euro creates the right conditions for economic prosperity by providing low inflation and low interest rates," he said.It is not uncommon for small countries in Africa, Latin America and Asia to use the currency of a major nation — typically, the U.S. dollar. When newly independent East Timor adopted the dollar after seceding from Indonesia in 1999, the U.S. Treasury dispatched planeloads of paper money and tons of coins to the impoverished Pacific nation.However, the euro has made inroads into the international dominance of the dollar. Montenegro, for example, switched to the euro after having adopted the German mark in the 1990s." ski (1/2/07; 17:46:25MT - usagold.com msg#: 150651) Kilo Thanks for your reply. I could talk at length about many of the points that you brought up. Instead, in the spirit of "nothing new under the sun", I'd like to suggest only one thought to chew on.I'll state my conclusion up front. TO GET THE MOST ACCURATE PICTURE OF SILVER'S PRICE BEHAVIOR OVER THE PAST 30 YEARS, OMIT THE PERIOD OF THE BRIEF, HUNT PRICE SPIKE. (This forces you to draw some very different conclusions.)The Hunt price spike of 1980 was a one-off event mostly caused by less than 10 individuals. The spike to $50 was NOT a free market event and thus did not reflect the underlying supply and demand fundamentals of the day. It was a rogue event. Yet, everyone looks back at the spike with certainty that silver volatility is inherently extreme and silver investing is therefore very dangerous. To add insult to injury, todays PM's authors mistakenly compare the $50 dollar silver spike IN AN EQUAL LIGHT to the $850 spike in gold. They are not hardly related. If you omit the Hunt price spike, silver is NOT even one-half as volatile as people now believe.I'm not one to haphazardly ignore history. But, IMHO, this is an exception the the rule. Without that price spike to cloud ones thinking, silver has made a very orderly advance and is not something to be feared.... but to be appreciated. mikal (1/2/07; 17:41:16MT - usagold.com msg#: 150650) @Pal Thanks for digging up that photo.Re: "You'll never guess what happened to me." Maybe he said, "What will those bloggers dream up next?" :) Pal (1/2/07; 17:34:43MT - usagold.com msg#: 150649) Other photo http://origin.denverpost.com/portlet/article/html/imageDisplay.jsp?contentItemRelationshipId=1404829 ...too quick on the click. Pal (1/2/07; 17:32:01MT - usagold.com msg#: 150648) Where in the world is Paulson?... Update http://news.yahoo.com/photo/070102/ids_photos_ts/r2986326775.jpg It looks like the original source at WorldReports is the first to give an update on the whereabouts of Henry Paulson.http://www.worldreports.org/news/38_paulson_and_cheney_sThe top link shows a close-up photo of him and here is another that(if you squint) he is seated in the top right corner.I would like to know the story that he is telling to Condoleezza Rice in the linked photo. I can't help but think it started with: "You won't believe what happened to me in Germany..."-Pal USAGOLD Daily Market Report (1/2/07; 17:23:49MT - usagold.com msg#: 150647) Page Update! http://www.usagold.com/DailyQuotes.htmlThe Daily Gold Market Report has been updated.If you are considering investments in gold we invite you to request our free introductory information packet detailing the products and services offered by USAGOLD ~ Centennial Precious Metals. We welcome your inquiry and look forward to working with you.TUESDAY Market ExcerptsJanuary 2 (from MarketWatch) -- Gold futures extended their winning streak in electronic trading Tuesday, with a weaker U.S. dollar helping the precious metal start the new year on firm footing.Trading on the New York Mercantile Exchange was closed to observe a day of mourning for former president Gerald Ford. Regular trading will resume Wednesday.Gold for February delivery was last up $4.30 at $642.30 an ounce in electronic trading on CME Globex."Gold bullion kicked off 2007 with a follow-through rally that was prompted by further dollar weakness overseas," said Jon Nadler, an investment-products analyst at bullion dealers Kitco."Trading activity may not resume a full participation level until next Monday and today's action also reflected market closings in Japan, in the U.S. equities markets, and the fact that some traders have not made it back to their desks yet," he said.For now, "we remain friendly towards the [gold] market in a long-term accumulation sense, and whilst even the medium-term looks appealing, there are some risks still lingering in the background," he said, pointing out that $650 "has previously proven difficult to overcome..."---(see url for full news, 24-hr newswire)--- Flatliner (1/2/07; 17:22:17MT - usagold.com msg#: 150646) Anyone use Euronext? www.euronext.com Anyone know anything about it? I'm able to find "Today, Euronext is Europe's leading cross-border exchange, integrating trading and clearing operations on regulated and non-regulated markets for cash products and derivatives. Euronext was formed in 2000 in response to the globalisation of capital markets and to create a pan-European exchange offering its participants increased liquidity and lower transaction costs."Also find: "Transparency Directive. These measures are due to be finalised in the course of 2006. More competition between market operators is likely to result from the MiFID, which allows financial institutions to execute orders from clients outside the regulated markets by means of MTFs and the internalisation of order execution by investment firms. Moreover, the MiFID establishes a harmonised framework for Europe's regulated markets, which may make it easier for them to obtain recognition in countries outside the EU, including the US." GOLD FINGER (1/2/07; 17:20:31MT - usagold.com msg#: 150645) Set your goals & BUY gold! Happy 2007!I find it interesting how many always refer gold as the "PAR" medium of exchange. I think that if I were to act on this comment taken from this article posted I would take my earnings in gold. In fact I whish more would pay in gold. I think over all many would be in a much better position......."With 600 feet of oceanfront property and an additional 1,100 feet along the Intercostals Waterway, real estate like this in southeastern Florida is pure gold."http://www.msnbc.msn.com/id/16440697/?GT1=8921GFI need some piggies for my gold collection! TownCrier (1/2/07; 16:20:49MT - usagold.com msg#: 150644) Argentine savers angry at peso ruling http://www.ft.com/cms/s/73bff2b2-9659-11db-8ba1-0000779e2340.html December 28 2006 -- Argentine savers protested angrily on Thursday at a Supreme Court ruling designed to end a five-year impasse over the forcible conversion of dollar savings into devalued pesos during the country's 2001-02 crisis.The judgment has caused further anger among many savers and could yet pave the way for more litigation.The court upheld a government move on Wednesday and ordered that the value of dollar savings frozen at the end of 2001 to prevent a run on the banks and then converted into pesos at the start of 2002 would be repaid at current market rates and in pesos.Jose Luis Espert, an economist, said: "Even if they are given the same amount as their dollars in 2001, a dollar today is not the same as a dollar five years ago." Mr Espert noted that the ruling gave no compensation for any return on the savings that people could have made during the past five years – a loss of 30 per cent, according to some calculations.Dozens of Argentines gathered outside the Supreme Court with signs saying "Corrupt, thieves, give us back our savings" and "Remember: the banks robbed you and they'll do it again."Mr Espert said it was lamentable that the court had upheld the expropriation of much of the nation's savings. "It's one more example of this country's institutional shortcomings," he said.The government still faces litigation by the holders of $20m worth of bonds who refused a 70 per cent writedown on their debt and are suing for full reimbursement.^---(from url)---^Dollars, pesos... merely variations on the same theme. Why save using paper when you can choose gold?And speaking of which, on this specially appointed day of remembrance for Gerald R. Ford, we owe a special debt of gratitude to this fine man for signing into law the appropriate legislation which became effective December 31, 1974 and put an end to the abominable executive orders and legislations that germinated during the Roosevelt (FDR, not Teddy) administration which prohibited American citizens from owning gold from 1933.This dark stain upon human rights lasted 42 years, through both Democratic and Republican administrations, and had a multi-generational negative impact to disassociate gold as a viable savings alternative in the minds of U.S. citizens. Barring any new acts from Congress, this restriction was finally put to rest under the steady hand and penmanship of our dearly departed and warmly remembered former President, Gerald Ford.R. TownCrier (1/2/07; 15:28:51MT - usagold.com msg#: 150642) Gold's year-to-year gains... 35.9%, when considerately measured. http://www.usagold.com/gold-coins.html Having seen a number of commentators in the press call attention to gold's price gain (23%) over the January-December span of 2006, I would like to offer a few additional words from a slightly different perspective which is more appropriate for the typical gold owner/investor and client of USAGOLD-Centennial.As many folks have turned to physical gold ownership as a rock-solid alternative to the counterparty risks and margin-call follies inherent in the volatile derivatives markets, an evaluation of gold's price at year-end December 31st as a percentage-gain over January 1st makes little rhyme or reason when considered against the typical pattern of their acquisitions.Our typical client and gold owner buys gold, not as a one-off speculation to coincide with an annual clock, but rather as a means to capture and consolidate the purchasing power of their accumulated excess dollars. They accomplish this through consistent and regular series of acquisitions throughout the year (and, even then, usually trying to catch any opportunistic price-dips).When thinking about gains from year to year, therefore, I find it much more useful to bear in mind this behavior by which their accumulation of gold is acquired -- not at January 1st, but rather in increments throughout the whole year, and from one year to the next.Just a moment ago I mentioned price dips, but for the sake of even-handedness, the remainder of this commentary will assume that those attempts provide results that are no better than another buying blindfolded.For all transactions conducted throughout the span of 2005, the average goldprice was $444.5 per ounce for each transaction.For all transactions conducted during 2006, the average goldprice was $604.0 per ounce for each transaction.This simple and straightforward demonstration reveals that holdings bought on average (blindly) in 2005 and sold on average (blindly) during 2006 would have netted gains of 35.9 percent for the participant.35.9 percent ! ! ! [That's pretty impressive for buying (and then selling) with your eyes closed!]But again, in trying to address the situation as most accurately pertains to the typical client and goldowner, we would rewrite the section about to omit the part about them selling in 2006, and calculate instead that the same average 2005 gold held throughout is actually tipping the value meter at 44.1 percent gains when evaluated at today's current price of $640 per ounce.A BONUS BACKGROUND SNAPSHOT!As said above, average price in 2006 was $604, and average price in 2005 was $444.50.2004's average spot price was $409.25 per transaction.2003 had an average of $363.50 per ounce.The average price for 2002 was $310.00, and the average 2001 price was $271.00 per ounce.In percentage terms, year-by-year gains in average annual gold price have been 35.9 percent, 8.6 percent, 14.4 percent, 17.3 percent, and 12.6 percent.The bottom line:Physical gold -- no muss, no fuss, no hassles, no margin calls, no counterparty risk.What are you waiting for? Diversify your portfolio today and begin your program of regular, tangible acquisitions.Speak to a USAGOLD broker TOLL FREE 1-800-869-5115 for a diversification strategy that's right for you.R. Kilo (1/2/07; 15:12:51MT - usagold.com msg#: 150641) Mr. Ski True sir, I do tend to lurk more than post here at the castle, though my PM investments go back to the days of Jerome Smith and other early silver prognosticators. I still try to pick out the occasional words of wisdom from the "nothing new under the sun" daily rehash. (grin)I agree that silver is the much more volitile of the primary PMs, that the market price in fiat can and often does outpace gold. But as we know from times past, this can apply to the downside as well as the upside.....the farther they rise, the farther (and faster) they tend to crash when that time comes. The 1978-1981 era is a good case in point. But where are we today, vis-a-vis the all-time market peaks ? Gold is comfortably in the 74 percentile range while silver still lags more along the lines of 26 percent of its peak. This is not to say that I prefer one over the other, gold or silver, and one can always look at the current situation from different perspectives. Either silver has failed to retain its peak percentage in comparison to gold, or in failing to do so, it provides even more opportunity for the future. Like any good prognosticator, a positive case can be made for any investment at any time when properly "spun" to fit the circumstances.I suppose too that we each have our different goals in mind when it comes to the PMs. While you look to maximize (assumed dollar) profits in as short a time as possible as stated, others of us take into consideration maximizing our purchasing power stability in like kind. Does one form of metal provide more "volitility protection" than the other, while the other provides just the needed volitility to maximize in-and-out trading profits on a dollar basis ? I believe that is pretty much a well established fact of life.I'd also like to say that I have followed your writings across the internet concerning silver, right along with the writings of others about gold. For many asundery reasons, I hold both with no particular aversion or preferrence for one over the other. Both fit the bill as far as "profits and protection" in my view, and that is the beauty of choice. As tejbear mentioned, "separate baskets" with similar goals, though I could ship my AU holdings in a single (heavy) package while it would take a truck to haul the AG. Interesting to note also that the AU holdings carry some 4 or 5 times the monetary value of the AG. Minero (1/2/07; 15:12:13MT - usagold.com msg#: 150640) @968 & Flatliner "Wanta story" I too have read all that I can find on this subject. The numbers are so large as to give me a headache. I can find nothing to truly discount the story. In lew of what I am seeing relating to the Illiminitti and NWO stuff, I suppose if one were true, the other well could be also. Things are merky at best. Flatliner (1/2/07; 14:43:03MT - usagold.com msg#: 150639) A continuation of ‘Euro discontent’ from below Empirical evidence states that the Euro is widely adopted. Also, many months ago, some head of a central European bank stated that he did not want oil trading in Euros. It would make the currency too strong thus leading to the problems that Euroland seems to be having today with exports and imports. Likewise, a rumor (very fine intelligence source?) states that Germany and France are distributing local currencies because they – are scared that the loss of function will kill the economy and thus kill the Euro currency.At this point, the logic behind the function of the MTM gold in the European central banking system makes me believe that the conclusions reached above many not be completely accurate. Specifically, there is gold on reserve to defend the Euro. My reasoning may be circular, but I'm leaning towards a story where the Euro engineers are pretending to discredit the Euro in order to intentionally elevate gold as the currency of currencies. People all around the world do not believe that there is enough gold in the world to absorb the ‘wealth’ held in currency terms, thus currency doesn't even consider chasing gold. Thus, the Euro engineers are trying really hard to get to world to move that way (towards gold). If they are successful, gold will be revalued, the Euro will continue to function and no paper currency stands up as the world reserve currency (it will have been replaced with gold). If they are not successful, they may withhold their own gold from the markets for a little while to bring the entire story to light. At that point, using gold to defend the Euro will be an easy thing to do and the Euro stands on it's own.Either way, gold wins out. It's just a trick of getting the bulldog to look the other way while you jump the fence. mikal (1/2/07; 14:28:04MT - usagold.com msg#: 150638) Electronic trade starts off 2007 http://www.marketwatch.com/news/story/gold-futures-extend-recent-gains/story.aspx?guid=%7B102BD31D%2D9172%2D4507%2D8B60%2DBA3035186E72%7D&dist=news Gold futures extend winning streakMyra P. Saefong, MarketWatchLast Update: 2:28 PM ET Jan 2, 2007SAN FRANCISCO (MarketWatch) -- Excerpts:"Gold futures extended their winning streak in electronic trading Tuesday, with a weaker U.S. dollar helping the precious metal start the new year on firm footing.Trading on the New York Mercantile Exchange was closed to observe a day of mourning for former president Gerald Ford. Read more. Regular trading will resume Wednesday. Gold for February delivery was last up $4.30, or 0.7%, at $642.30 an ounce in electronic trading on CME Globex. Volume on the CME Globex electronic trading platform rose 31% in 2006, with total volume of 956 million contracts, the Chicago Mercantile Exchange reported Tuesday. CME Globex volume accounted for a record 75% of total CME volume for the fourth quarter of 2006, vs. 67% during the same period a year earlier. On Friday, gold futures closed up $1.10 at $638 an ounce on Nymex, marking its fifth-straight session of gains. The price was 23% above the close of the front-month contract on the last day of 2005. See full story. "Gold bullion kicked off 2007 with a follow-through rally that was prompted by further dollar weakness overseas," said Jon Nadler, an investment-products analyst at bullion dealers Kitco.com. "Trading activity may not resume a full participation level until next Monday and today's action also reflected market closings in Japan, in the U.S. equities markets, and the fact that some traders have not made it back to their desks yet," he said... "If the economic data to be released soon will indeed (as many expect) confirm a cooling U.S. economy, the prospects for any imminent rise in U.S. dollar rates will keep getting pushed further back, as the primary concern for the Fed may become how to stimulate the over-extended and quite tired armies of U.S. consumers," said Nadler. For now, "we remain friendly towards the [gold] market in a long-term accumulation sense, and whilst even the medium-term looks appealing, there are some risks still lingering in the background," he said, pointing out that $650 "has previously proven difficult to overcome, we are near a one month high, short-term dollar support could emerge" among other things. So for the short term, traders might "wish to proceed with heightened caution." Mikal-- These last few quotes are somewhat like performing a soothing zither or lute, strumming to ticklein your ears a buzz over mythical "resistance" and "support" levels.Low levels of PM's holdouts compared to earlier stages of the 5 yr bull market mean that some fence-sitters and experts(and I admire all the experts for their unique perspective and gold-insights versus the detractors and distractors)are nursing wounds, financial, psychological or both. Flatliner (1/2/07; 14:04:15MT - usagold.com msg#: 150637) @968 Simple; What cannot be disproven could therefore be possible - and - time will surely tell us more.At this point, I have queried the net enough to know that the information to disprove this is not currently within my grasp. If it was, I would share it, apologize in(to) this great forum and move on.One thing that I have learned from the hours of reading through the postings that have been gathered on this site is that the posters humbly strive for honesty and demonstrate a clear desire to understand the truth and that the focus has been on the real underpinnings of the financial system. Thus, seeing the Wanta story (and hearing it - see a previous posting,) it sparks a little curiosity on my part, but I would guess that it would also spark the curiosity of others in the forum. Also, knowing that this forum is connected to a worldwide audience, it would logically play that if there is information outside my reach, there would be others that would have a simple disproval within their reach and they would share. So far, that has not come about.There are many claims made in the reports that could be easily verified – given the right connections. For instance, if the Germany and France are truly hedging their Euro stand with local currencies, by actually moving them into key banks, it would stand that we (those in the forum or those connected to the forum) would be able to make contact with someone that is a witness to get verification. If currencies are moving, someone has to move them. No? Together, we are many eyes. With the net as our nervous system, we should be able to put this picture together sooner rather than later. mikal (1/2/07; 13:55:49MT - usagold.com msg#: 150636) Increase in base metals mining paces profits http://www.mineweb.net/mining_finance/547587.htm Major Base and Precious Metals all up in 2006. Where to in 2007? By: Rhona O’ConnellPosted: '02-JAN-07 12:00' GMT © Mineweb 1997-2006LONDON (Mineweb.com) --Excerpts:"Last year saw yet another bullish performance overall from the metals markets with gains registered all round over the course of the year; this article is intended to provide a brief round-up of the metals’ activities. As the table shows, the non-ferrous sector was a stronger performer than the precious metals...Some financial houses are looking for a bursting of the commodities bubble during 2007, but GFMS Metals Consulting remains friendly towards the markets, noting that the economic environment remains remarkably benign for this stage of the cycle. The group does make it clear, however, that this and other fundamental factors do not necessarily point to further price increases. The Group's forecasts for 2008 will be published in its next Monthly Briefing."Mikal-- The spread on a gold purchase and/or sale continues to shrink compared to that of other metals, especiallyas wild volatility of these other metals escalates risk premiums. Nonsense in this mineweb story about the end of the housing correction joins with reliance on long-compromised growth and economic statistics but doesn't mean that the actual shrinking in the US GDP versus positive GDP in other nations won't turn into a global recession or (as is likely) worse: "The economic numbers released for the United States towards the end of December were generally stronger than expected and there is an increasing view that the fall in the housing market, a key driver of the economy, is drawing to a close. The fed funds futures markets are now pricing in the possibility of one rate cut from the Federal Reserve next year, probably in the third quarter; this is more hawkish than the view prevailing before Christmas, when the markets were looking for two rate cuts with the first coming in the first quarter of the year. The European Central Bank is expected to continue to raise rates as senior officials are consistently commenting to the effect that the Bank's monetary policy remains "accommodative" and money supply is also growing at a higher rate than is seen as comfortable, while the Bank of Japan, despite some continued concern on the part of some Japanese politicians, is likely to retain a hawkish view and to raise rates further, although this is both from a very low base and expected to be gradual."Mikal -- Advances in money supply have not only accelerated. They have entered the statosphere, untethered and uncontrolled like Greenspan suggested, after he was retired and no longer paying lip service to the greatness of the "new economy" and structured finance. The many aggregates and proxies, derivatives and loans and financial instruments origination from nations like Japan, China, India, the EU, Britain and from their private companies, banks and financial institutions is overextended and overrated. Behind the walls of the BIS and it's geneological intimates it is time to rein in the Fed, for if rates are lowered, raised or kept steady, a "benign outcome" is no longer possible within this quarter IMO. New directions appear inevitable and the euro area should also see easy solutions to many gripping problems as a rising price of gold should buttress their balance sheets.Industry groups such as GFMS are hopelessly undermined by corporate and political interests and this mineweb article reveals similar slant and some liberal use of rose-colored prognosis:"With economic imbalances still a cause for concern this continues to point towards a further weakening of the dollar after its recent upward correction, while underlying global economic activity is likely to continue to underpin metals demand. These factors continue therefore to point to sustained strength in the non-ferrous metals markets and, largely, to that of the precious metals also (there is plenty of scope here for arguing that there is in fact only one truly "precious" metal, but this piece is not the appropriate platform for that debate). GFMS Metals Consulting notes that the supply side of the base metals is, as would be expected, more varied. The group highlights nickel as the market where the "producers are struggling meet demand" and pointed out also that many of the next generation of nickel projects are hampered by financial, technological or political risk. Copper, lead and zinc are characterised by extreme tightness at the concentrate stage (although this is likely to ease during the coming year) and that it is only in the aluminium market where we are already seeing a supply response to high prices. As far as the precious metals are concerned, gold continues to enjoy broadly friendly sentiment on the back of the outlook for the dollar, sustained strength in the fundamentals and continued geo-political uncertainty. The platinum market, while the under performer in 2006, is expected to remain relatively buoyant although fresh mine supply is coming on stream in response to the price's notable strength earlier in the decade and the sustained tightness in the market, with little available by way of inventory. Palladium, by contrast, remains plagued by high inventory and this may hamper any further attempts at fresh strength. Silver is the Lord Byron of the sector; in the words of Lady Caroline Lamb, "mad, bad and dangerous to know". The sharpness of the recoil in December of 2006 was by no means the first time this metal has dropped like a stone; its fundamentally justifiable price is considerably below the prevailing prices above $12.50 and holders should be aware that this metal can bite you when you least expect it. Note that professional speculators, of late, have been taking very quick turns in this market." 968 (1/2/07; 13:30:14MT - usagold.com msg#: 150635) @ Flatliner Flatliner, what are your personal thoughts on the Wanta-story ? Flatliner (1/2/07; 11:50:40MT - usagold.com msg#: 150634) Rumblings of Euro discontent http://www.kitco.com/ind/Laird/jan022007.html A dichotomy? On one side we read that there is a building new world reserve currency – Euros (see mikal's posting below). On the other, rumblings of loss of confidence? Hum…The article by Chris Laird has a great link in it (http://worldpoliticswatch.com/article.aspx?id=445 ) and I wonder if there is more supporting information for his stand?From Chris's article: "Reports of Germany and France readying stocks of native (non euro) currencies – in case of – what? Those reports alone made me take a big double take, thinking of what this can mean." Unfortunately, the only place I've found any hint that might support this statement is through reading the Wanta tail. Is there anyone that can support this claim via any other means? ski (1/2/07; 11:45:28MT - usagold.com msg#: 150633) just for Kilo #560625 Yes, you are PRECISLY correct in stating: "After all, you cannot have the same money invested in both metals (gold & silver) simultaneously." The reason why you "missed the point" is that I intentionally did not make myself perfectly clear in a effort to avoid upsetting any of the gold-bug-investor types here. Didn't want to rub silver in their face so to speak.Actually, silver has outperformed gold, not just the past two years, but on a multi-year basis. It is the clear investment winner & people should be paying attention. The impression that I get on the fourm is that many here still don't get it or don't want to see it.... thus we are forever talking about gold with little mention of silver.As a small investor, I have one primary goal. "To make as much money as I possibly can in the shortest possible timeframe." Thus I only own silver and have no meaningful gold investments whatsoever.Kilo, I can't recall seeing your name here all that often. So just for the record, I have been here for several years and have strongly advocated silver from the day of my arrival. So, I've always been on the right side of the price predicting contest. I hope you are too! mikal (1/2/07; 11:33:09MT - usagold.com msg#: 150632) Peaked prosperity underscores nature of overextensions and predatory colonialism http://seattletimes.nwsource.com/html/localnews/2003505560_peakoil27m.html?syndication=rss World's Oil Outlook Frightening, Group SaysBy Andrew Garber, Seattle Times staff reporterExcerpts:"Dave Reid, a member of Seattle Peak Oil Awareness, added solar panels to his Beacon Hill home, which he purchased close to the new light-rail line.Food shortages, cars abandoned, another depression. It's the stuff of nightmares — and the type of future an eclectic group of engineers, computer experts and others in Seattle believe could await us.They're not religious zealots predicting Armageddon, nor survivalists digging bomb shelters. They believe the world is about to start running out of gas.Literally.Members of Seattle Peak Oil Awareness expect world production of oil and gasoline to peak soon, if it hasn't already, and hard times to follow. Similar groups are popping up around the country from Boston to Portland, despite oil-industry assertions that there's nothing to worry about...Other members of the group talk about a financial shock caused by soaring oil prices, followed by something approaching the Great Depression."I think we're looking at recession upon recession upon recession," but not a complete breakdown of civilization, said Dave Reid, an electrical engineer with a touch of a Scottish accent."We're not going to Mad Max," he said, referring to the post-apocalyptic movie.Reid, who is 43, is preparing by investing in gold, installing solar panels and buying a home near the new light-rail line, which he figures would still operate. Other members of the group are making similar preparations for a low-energy future."[Calls for more government action mentioned in this article will grow louder. The Independent online featured a story this weekend that did just that based on global warming fears. This is reason enough to believe the price of energy products will not go down, because government wants the tax revenues and bigger bureaucracy.Add too many other propellants, some of which are:OPEC.Halliburtan, BP, Exxon Mobil et al.Leveraged investment vehicles (and those slated to open).Recent news of the monster broken (south of N. Pole) ice shelf & related global warming fears.Costs of current, planned environmental restrictions.Asian energy use for cars, industry.Aging infrastructure.Security costs associated with petrofuels. mikal (1/2/07; 11:00:59MT - usagold.com msg#: 150631) Dollar bears could have easy call this year as many forces converge http://www.fmnn.com/WorldNews.asp?nid=30411 2007 DOLLAR DECLINE, RECESSION? Tuesday, January 02, 2007 - FreeMarketNews.comLINKED NEWS ANALYSISEconomists anticipate that the fall of the U.S. dollar in world currency markets that began in 2006 will accelerate in 2007. "The dollar could lose as much as 30 percent of its value in 2007," econometrician John Williams, who publishes the website Shadow Government Statistics, told WND. "In 2007, we are likely to see the economic downturn of 2006 develop into a structural recession and yet we have international trade and federal budget deficits careening out of control." World Net Daily Click Here For The Full Story mikal (1/2/07; 10:55:15MT - usagold.com msg#: 150630) Underground euros, black market gold http://www.fmnn.com/Analysis/110/6675/world.asp?nid=6675&wid=110 THE WORLD'S RESERVE CURRENCYTuesday, January 02, 2007 - Dr. Ron Paul, Congressman TXThe financial press reported last week that the euro, the new currency created only five years ago and used by most European nations, has supplanted the U.S. dollar as the most widely used form of cash internationally. There are now more Euros in circulation worldwide than dollars. This alone is not necessarily troubling, as the dollar remains the world's most important reserve currency. About 65% of foreign central bank exchange reserves are still held in dollars, versus only about 25% in euros. And the European Central Bank faces the same inflationary pressures that our own Federal Reserve Bank Governors face, including a growing entitlement burden that threatens economic ruin as both societies age. European politicians want to spend money just as badly as American politicians, and undoubtedly will clamor to inflate – and thus devalue – the euro to fund their creaky social welfare systems. Still, the rise of the Euro internationally is another sign that the U.S. dollar is not what it used to be. There is increasing pressure on nations to buy and sell oil in euros, and anecdotal evidence suggests that drug dealers and money launderers now prefer euros to dollars. Historically, the underground cash economy has always sought the most stable and valuable paper currency to conduct business.More importantly, our greatest benefactors for the last twenty years – Asian central banks – have lost their appetite for holding U.S. dollars. China, Japan, and Asia in general have been happy to hold U.S. debt instruments in recent decades, but they will not prop up our spending habits forever. Foreign central banks understand that American leaders do not have the discipline to maintain a stable currency. When the rest of the world finally abandons the dollar as the global reserve currency, both Congress and American consumers will find borrowing money a more expensive proposition. Remember, America can maintain a large trade deficit only if foreign banks continue to hold large numbers of dollars as their reserve currency. Our entire consumption economy is based on the willingness of foreigners to hold U.S. debt. We face a reordering of the entire world economy if the federal government cannot print, borrow, and spend money at a rate that satisfies its endless appetite for deficit spending.At some point Americans must realize that Congress, and the Federal Reserve system that permits the creation of new money by fiat, are the real culprits in the erosion of your personal savings and buying power. Congress relentlessly spends more than the Treasury collects in taxes each year, which means the U.S. government must either borrow or print money to operate – both of which cause the value of the dollar to drop. When we borrow a billion dollars every day simply to run the government, and when the Federal Reserve increases the money supply by trillions of dollars in just 15 years, we hardly can expect our dollars to increase in value. frosty 1 (1/2/07; 10:40:11MT - usagold.com msg#: 150629) 2007 revisit the gold trail.... hello!! happy 2007!!I was thinking on the wise advice that all long term Goldtrail followers had at thier screens.Some, just read the sage advice of the mystery posters(Trailguide, another) and did nothing...others acted and did well.Now,as much of the advice was forward thinking and about the best way to position ones self as the future unfolds,I think it would be wise to update everyone on just where we are on this (Trail).As we should not take any one person, or groups take on matters...we should not let a goodtrack record go unrewarded.I do think there is much value in what these fellows foretold.If anyone who has been on the trail would like to do a short summary of what these posters had to share,it would help everyone.The postings of the trail are quite lengthy but should be read for those who can find the time. frosty1 Flatliner (1/2/07; 10:26:50MT - usagold.com msg#: 150628) International Forecaster's view on oil and gold http://news.goldseek.com/InternationalForecaster/1167677349.php Snip: "The depreciation of the US dollar, the world's reserve currency, did not happen due to malfeasance – it's the result of a calculated plan to tax dollar users. ..."Knowing how to measure your tax burden is something that is not taught to the commoner. The common misperception is that the only time a tax burden is acquired is during a purchasing transaction. The wise know that not purchasing is also a taxable situation as they have learned to count the impact of loss of purchasing power in their currency hoard. Fortunately, the laws are fashioned so as to backload the taxable transaction. The loss of purchasing power is measured later, rather than now. Thus, to a saver, it pays to acquire something that is not taxed over time and is rare enough to maintain its purchasing power.From the postings below, it looks like gold and silver fit the bill for savers. Many other big ticket items are taxed over time (houses and property) thus they must be put to work or they become a draining asset over time. What is more valuable than these metals? Life. Buy your insurance for life and then build you life savings. Where is Black Blade anyway? Best wishes! tejbear (1/2/07; 10:21:10MT - usagold.com msg#: 150627) Kilo, msg#: 150625 Why would you want "all" of your eggs in one basket? Both metals are precious, but have different characteristics that make both desirable. In terms of investment, silver will out perform gold. However, it is very difficult to carry $10,000 worth of silver in one pocket. Given the draconian leadership in the US today, this may facet of gold may well be more important than silver's ROI. And don't forget, even the Mogambo keeps talking about oil.The Bear USAGOLD / Centennial Precious Metals, Inc. (1/2/07; 09:28:35MT - usagold.com msg#: 150626) Hard assets, EASY access! Kilo (1/2/07; 09:11:36MT - usagold.com msg#: 150625) Ski - Re: Combined statistics of gold and silver Correct me if I'm wrong (or missing your point), but aren't the combined totals of gold and silver advances kind of a moot point ? After all, you cannot have the same money invested in both metals simultaneously. White Rose (1/2/07; 08:33:19MT - usagold.com msg#: 150624) It is even better than that You need to multiply the numbers to find out the results over 2 years.For gold: 1.181 times 1.23 yields 1.45 or a 45% increaseFor silver: 1.299 times 1.45 yields 1.88 or an 88% increaseI too am hopeful for significant increases in the valuing of gold and silver in terms of fiat money.Happy New Year! ski (1/2/07; 00:32:40MT - usagold.com msg#: 150623) Price Prediction Contest........... I've been here for several years and have noted a large number of Price Predicting contests. IMHO, there is only one guessing contest that is well worth attempting for everyone here.Gold's advance:2005 18.1%2006 23 %total 41.1%Silver's advance2005 29.9%2006 45 %total 74.9%In my post #140007 on 1-3-06,I predicted: (Hey, wass'up with doe's last three numb bers?) 1. Silver will outperform gold on a percentage basis.2. The difference between gold an silver will be even GREATER than the 11.8% difference in 2005.Back to the point. THIS is the price predicting contest that has some real value to everyone who picks the correct answer. 41.1% is a "nice" number, but it's a distant second to 74.9%. And for 2007? No change in items 1 and 2 above.Let's ALL have a blessed, good year ...... ViewYesterday's Discussion.
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