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ARCHIVED DISCUSSION FROM 4/27/2002 All times are U.S. Mountain Time (Yesterday's Discussion.) Golden Bear (04/27/02; 22:12:20MT - usagold.com msg#: 74472) @darkhorse darkhorse - what is it about these writings that you find so far fetched,just curious...One point Endgame made got me thinking...the central banks signed the WA without the USA, and the USA didn't respond or protest as far as I know (correct me if I am mistaken).Doesn't it seem odd? Just playing with the pieces of this vast jigsaw puzzle...Cheers. darkhorse (04/27/02; 21:32:58MT - usagold.com msg#: 74471) Mr. Bill Just to keep the record straight...I've definately got clearer vision than your Mr. Endgame. mikal (04/27/02; 20:52:48MT - usagold.com msg#: 74470) @Old Yellar http://www.ft.com Re: Your FT (Financial Times ) link below- Their "Editorial Comment" deserves another look. Regarding the US dollar: snippit....."Monetary authorities outside the US should stand ready to ease policy further to offset falling external demand. And though the Federal Reserve would have to monitor inflation closely, it should not rush to tighten policy as the US economic recovery remains fragile. A rapidly falling dollar represents perhaps the most significant threat to a smooth global recovery. The greenback's value, in turn, relies upon the willingness of others to continue to fund the yawning US trade gap. Neither can be counted on." End....click Old Yellar's link for more Mr. Bill (04/27/02; 20:35:48MT - usagold.com msg#: 74469) @darkhorse Different stokes, I guess. Sounds like you have seen the way. CoBra(too) (04/27/02; 20:16:38MT - usagold.com msg#: 74468) @ CM - Hegemon? ... Funny you've asked - Listened to a great interview withProf. Herman Bahr, a real european philosopher, even a former german socialist politician - who used hegemon in a monetary, economic and political sense. The outcome was - the US is the only global superpower - left - in a sense of superiority of technological - let's call it defense (hopefully)- for some time not to be challenged. The "hegemon" of the us $ reserve currency - as the payback for protecting the Nato and other allies from the cold war - have lent their 'acquiescence' to the unequal deal. As now it becomes more clear that the US $ Hegemon, in conjunction with being rewarded with the only global Super Power Status - and real enemies are not readily found - WAT may become the equivalent of - worst case scenario, to blindfold the formerly free US citizens - via Patriot and other idiot Acts - to forfeit the quest to liberate, free and aid the the rest of the world to become a global free trading democracy! - Uh, OH; so only under the auspices of a global and hegemonial in-equilibrity of pricing any product or service to a degree of lasting stability ... in the Idea of global sharing of labor - or better wealth and real productivity ... is inadequately dealt with today's hegemon of the US - Reserve Currency - a Fiat Monster taking on the "Aes Aliena" of the late Roman Empire!G'nite cb2 darkhorse (04/27/02; 20:13:33MT - usagold.com msg#: 74467) (No Subject) I'm watching my local Fox newscast, and they're running a story on how people are losing sleep and worried about their investments, the SM, the economy and all the lay-offs. One of their lead-in lines was "Maybe you should just quit worrying." Old Yeller (04/27/02; 20:08:52MT - usagold.com msg#: 74466) FT jumps on the dollar dogpile http://news.ft.com/ft/gx.cgi/ftc?pagename=View&c=Article&cid=FT3D5FJDI0D&live=true This isn't your usual gloss-over job either.Seems pretty clear now the agenda has been shifted,Plaza Accord II is really getting a solid media send off.Hope they've lined up some buyers,or it could get real crowded at the exits. darkhorse (04/27/02; 19:57:25MT - usagold.com msg#: 74464) @Mr. Bill I read a few articles off your Mr. Endgame's site...sounds to me like he makes that stuff up as he goes. Some people shouldn't be allowed to have a PC. CoBra(too) (04/27/02; 19:32:40MT - usagold.com msg#: 74463) Arctic Fox - Bonner Part IV. Gold's Revenge - "so what do I know - and I'm quite good at knowing nothing - officially, that is. Still I've been a little wee doubtful at the rich valuations we've had - oh, still having on tech and almost all other stocks! But, what do I know? Is the US $ priced to perfection - against what - who- ever has mentioned the Big Mac Index is at least on a value, sorry purchasing power approach - again I caught myself thinking in archeological terms. ... Big Mac's may be - by some quirk of nature be partially embedded in (plastic) and buried for another era to excavate - and now Moscow and Bejing is hung with the original - Junk Food - craze of your neighborhood. - Oh, well, forgot my thought anyway - ... just figure some future archeologist finds a silver a/o Gold Eagle on your property in San Fran and says to his fellow rescue team after a 7.8 Richter scale tremor - those ancient guys knew how to anchor their buildings .... - True and their family savings - as well - insurance too ... cb2 Cavan Man (04/27/02; 19:25:41MT - usagold.com msg#: 74462) Hello CB2 Is that "hegemon" or, POKEMAN? Is there a difference?Excellent post!(as usual) Mr. Bill (04/27/02; 19:15:36MT - usagold.com msg#: 74461) @mikal - silver scam http://www.endgame.ca/ This link should work. Thanks for the heads up cb2. Arcticfox (04/27/02; 19:05:04MT - usagold.com msg#: 74460) Bonner....Part III REVENGE OF GOLD, PART IIIby Bill Bonner"We are seeing a gradual but marked change in investor sentiment toward gold and a simultaneous return of gold to its 2000-year old status as a reserve asset..."Ian CockerillWe begin with a confession. In our first and only encounter with the voting booth, we pulled the lever for Jimmy Carter back in the '70s. We learned our lesson and promised never to do it again.We have been recalling the '70s in the last few letters. The era was unlike today, of course. Those were the days when graphs of Jimmy Carter's popularity...consumer confidence...and the dollar...all headed in the same direction - down - and few people could imagine that they would ever turn up. Gold, meanwhile, only seemed to go in the opposite direction - up - and few people (certainly not your editor) could imagine that it would not continue. So different were the '70s from today that we can scarcely imagine how they were, even though we can recall the major events. What is hard to remember is how we felt at the time. Today, we are full of pride, confidence and irrational exuberance. Then, the national mood was one of sullen despair, negativity and irrational desperation. Remember waiting in line four hours to buy gasoline? Remember consumer prices rising at 13% per year? By the end of the decade, the yield on 10-year treasury bonds had soared to over 10%; and who wanted them? Everyone knew they were nothing more than "certificates of guarantee confiscation." Then, barely months after the end of the decade, Business Week famously announced - on its cover - that equities were not just down, but out forever. But, even at 8 times earnings, who wanted stocks at the end of the '70s? And yet, we were human then too. Coming to the central question of today's letter: might we feel tomorrow the way we once felt yesterday?That is the weakness of the human condition, dear reader. We have strong powers of logic, but weak powers of imagination. Give us a trend and we will put "reasons" in it faster than maggots can find a dead chicken. Then, the "reasons" will help us look ahead to what happens next - extending the life of the trend into the future as if nothing could stop it. But something always does. Just as maggots soon eat their way through dead flesh, so does a trend sooner or later exhaust itself...and have to move on.Fighting a war against terror in Vietnam was expensive. But it wasn't just the money that brought American low in the '70s. It was also one little detail - the terrorists won! "I remember those years," said a French army officer at dinner the other night. "After WWII and then the war in Algeria, the French military was totally discredited. In the '60s, it was almost an embarrassment to wear a uniform. People in Paris practically spat on us. It was not so different in America after Vietnam. The army lost its prestige."But at the beginning of the '80s, Carter gave way to Reagan, stocks headed up, interest rates headed down and a major change of sentiment began. In a series of little wars and big defense budgets, the Reagan administration rebuilt the military. Meanwhile, stocks climbed over a wall of worry in the early '80s and eased into a warm tub of rising cash in the '90s. Gradually, too, the tough anti-inflation Fed of Paul Volcker eased into the accommodating bath of Alan Greenspan. From then on, every crisis that came along was salved with the same healing ointment - more cash and easier credit.Then, on September 11th, the world changed remarkably. But this September 11th was not the one you are thinking of. It was September 11, 1989 - the day the Berlin Wall came down. Americans peeked around them and realized they no longer had any competition. The U.S. was on top of the world - in a class of its own, the world's only superpower. A new glow of confidence began to light up the American countenance. Stocks soon went from making a reasonable rise from depressed levels to an unreasonable rise from reasonable levels. Gold fell as central banks unloaded their reliquary assets in favor of yield-producing dollar assets. And why not? Could anyone doubt the staying power of the dollar?Then, the Nasdaq crashed...and another September 11th came along - in 2001. People are beginning to wonder - as Charles de Gaulle did in the 1960's - how much is a dollar really worth? "During March 2001," writes Ian Cockerill, CEO of Goldfields, "there was a turning point in the price of gold. What you see from here on out is a gold price coincidently testing new highs and concomitantly creating higher lows. We are seeing a new trading channel, with a general upwards trend, developing. "In my opinion, this is a systemic response to the increasing risk profile of the world. Over this period we have seen an upsurge in interest in gold from retail investors, especially in Japan and Germany, as well as institutional investors worldwide. Are investors returning to gold because they are nervous?"Demand for gold outstrips new mine supply, Cockerill points out, by more than 1,000 tons per year. And at current production rates and today's prices, mines have only enough reserves for about 10 years. Gold producers used to hedge, by selling their gold before they mined it. But the rising price of gold makes hedging no longer sensible. The forward price, Cockerill notes, is "but a hop skip and a jump from the current spot price." In a falling market, hedging adds supply - and forces the price lower. But in a rising market, hedging has the opposite effect. Producers who hedged their production have to buy on the open market in order to cover their positions.The big threat to the price of gold, though, is selling by central bankers. In recent years, central banks have operated an informal Gold Pool - taking turns selling gold. Whether intentional or not, the effect has been to depress gold's price. And while the terms of the Washington Agreement limit the amount of gold that central bankers are allowed to sell, the threat of future sales continues to menace the gold market. But a strange thing happens when the trend turns and gold begins a sustained bull market. Extrapolating from the last 20 years, we can barely imagine it. But, recalling the way we felt in the '70s, with our basements full of freeze-dried emergency rations...our portfolios full of gold stocks...and our heads full of hair...we can almost imagine it.No one wants to sell a rising asset. And while central bankers may have a common interest in keeping the price of gold low (coincidentally keeping the price of their paper high), Gaullism has not completely disappeared from the gene pool. Recently, gold has been outperforming all other currencies and every other major asset category. If the newborn trend continues, even central bankers will grow to like gold. Who knows, instead of selling it, they may become buyers. Yours truly,Bill Bonner, often accused of being a gold bug, but never convicted... Arcticfox (04/27/02; 18:58:17MT - usagold.com msg#: 74459) More Bonner.... THE REVENGE OF GOLD, PART IIBy Bill Bonner"It will be desirable to select as the standard of value that which appears likely to continue to exchange for many other commodities in nearly unchanged value."William Stanley JevonsRecall the 1970s. Back then, the future of the financial world seemed to depend on the money supply...as it seems to hinge on the consumer today. People watched money supply figures the way they watch consumer confidence tallies today. As the money supply rose, it seemed inevitable that commodity prices...particularly gold...would follow. A man with a little imagination didn't even have to open the newspaper. Because he knew that government controlled the money supply and that no government could resist increasing it. Ergo, the dollar would fall like a stone in a well...and the price of gold would soon hit $5,000.What made the '70s were the years preceding - the 1960s. A war on terrorism, '60s-style...in Vietnam...had escalated into a full scale war - in fact, if not in law. Congress had never bothered to declare war...and never bothered to raise the funds to pay for it. With the additional burden of the Great Society programs at home, it began to look as if the federal government was living beyond its means. Foreign dollar holders began to wonder. The gold standard of the 19th century had "died like a soldier" in WWI. It spent some time convalescing, disastrously in England's case, in the interwar years, only to get drafted and shot again in WWII. But the habit of monetary rectitude was so firmly established that it was hard to break. The U.S. government had organized a Gold Pool, by which major central bankers conspired to keep the price of gold below $35.20 an ounce. Managed by the Bank of England, member nations supplied gold - which was sold at critical moments to keep the price down. But General de Gaulle noticed the weakness in America's financial position in the mid-60s. In 1968, France pulled out of the Gold Pool arrangement and demanded gold in exchange for its dollars. Soon after, other nations began to wonder too. How could America continue to print so many dollars and still maintain the dollar's value at $35 per ounce of gold?It couldn't, of course. Three years after de Gaulle broke ranks with the London price fixers, Richard Nixon was obliged to "close the gold window" at the Fed. Henceforth, a dollar was just a dollar - a piece of paper with no value beyond what the world is willing to give to it.Thus began a remarkable experiment. No nation had ever made a sustained success out of paper money. Instead, each episode reads like a cautionary tale. The dates, names, places and circumstances change - from Imperial Rome to Revolutionary France - but the moral of the story remains the same: paper money is not merely a mistake, but a kind of sin; like bestiality, it is unnatural...like larceny, it is repugnant...like sloth, it is ruinous. Nothing in the experience of the '70s suggested that this time would be any different. The price of gold rose from $35 an ounce in 1971 to over $800 in 1979. Silver ran up from under $5 to nearly $40. Oil went from under $15 a barrel to over $30. Who could doubt that the process would continue? With no golden anchor to moor it, the dollar would soon float out to sea and disappear over the horizon. But tides go both ways. Just about the time people became convinced that gold would continue to float higher, the water level dropped. The decade which had been the best time ever to buy gold was replaced by two decades in which gold was nearly the worst investment a man could make. From more than $800 an ounce in 1979 dollars, the price fell to less than $275 an ounce in 1999 dollars. But, there is a lot of ruin in a nation, dear reader - more than can be drawn out in a single decade. Besides, markets do not destroy people right away, they toy with them first...flattering them cravenly before knocking them down. Twenty-three years after gold reached its peak, people no longer watch the money supply figures. Who cares about them? No matter how many dollars or yen or euro central bankers create, people seem to want more of them. Nor do they seem to care that nothing but bad intentions stand behind the paper. In attempt to gin up economic growth, Japan is increasing its money supply at the fastest pace in 30 years. In January, the Bank of Japan's monetary base was clocked at a 35.7% annual rate of increase. Just a year earlier, it was falling. "I genuinely fear hyperinflation in Japan once banks slow down the write-off of bad debt," said an analyst to Grant's Interest Rate Observer. Meanwhile, in Europe, de Gaulle's successors seem to want to get back in the Gold Pool. The European Central Bank recently announced that it would sell gold at auction.It has been the fashion of the last few years for central banks to sell gold and buy yield-producing dollar-based assets. Central banks still have many tons of gold - the legacy of the gold reserve years. Central bank sales have kept the price low, and the threat of greater sales discouraged buyers. Charles de Gaulle has been dead for many years. Barring some incredible breakthrough, he will stay that way. But while the general may have been sui generis, Gaullism (the annoying trait that makes a man break ranks in order to secure an advantage) is probably widespread. In a gold bear market, central bankers may readily stick together, taking turns offering their gold for sale in order to keep the price down. But when the tide turns...and the price of gold rises...Gaullism is sure to rise too.More tomorrow...including why the banks will not sell their gold. Bill Bonner CoBra(too) (04/27/02; 18:57:22MT - usagold.com msg#: 74458) Mr. Bill - Who ever you may be...Please spare us here with your - thankfully, not working links - to Mr. Endgame's unending stories of why the guy feel's nothing is at it seems ... cb2 Mr. Bill (04/27/02; 18:50:30MT - usagold.com msg#: 74457) Silver Scam http://endgame.ca You might want to check out that site. Has another view on why silver might not be the right bet. CoBra(too) (04/27/02; 18:49:29MT - usagold.com msg#: 74456) I've been on a Tight Schedule - and sorry not to respond ... Eexcept being more happy than anybody thinks about POG's advance -belatedly to JON's Question a couple of days back - who may have been taken aback by a (negative- after build up reserves to do away with the last hedges) quarterly result of DRD - asking me the next day's closing price ... - huh, I know, what's that in real money ... - still made my day ... You, know, my friend you remind me of a young Swiss Banker ... admittedly, years back who asked Senator Bentse-(o?)n of Texas and (at least Ron Paul's) equivalent - who asked the same question to the Japanese , what counter exports they would be willing to take on from the US ... after 20 y's we may know - none, as we all exported our production to the productive SE Asian Nations - the US, The EU and Japan ... While the Swiss Banker may have meant Swiss FR, you may have meant US$ vs AU - ... would you now please tell me JON - the POG vs $ vs Yen and vs ?After all consideration and the avoidance of any disturbance to your life style you - JP6 - should probably be invested by in physical assets like PM's - payed by a hyper-mortgaged home - and infested with other recurring debts - now about 140% of your disposable income. Wow, sounds like you're privately no better off than the Gov. of Japan, sporting the same 140% debt to total GNP.- After playing devil's advocate today, anyway - just look again at the compos(t)ition of the latest qu. GNP # of 5.8% -annualized growth. Again it's the sole detriment of debt, and the remaining bubbles - gov. debt, priv. debt, corp.debt and GSE's real estate - or better the unreal pricing for the state of the consumer Debt... or worse - for the boomer finding his retirement nest egg - worth "less" than he can afford to "care less"!The Boomer only was told to buy and hold - stocks - and buy again on dips - while the US of A changed from a productive country to Financial and other Services and Wall Street to M&A and Main Street to applaud what their typical old producing co. was doing in your neighbourhood. Take GE - It's now everybody's neighborhood on CNBC - and how many touting Bob's, Joe's and Maria's do you need to make up for the fake 'feel good' sake ... while you know that GE has left your very own neighborhood obsolete with ... golden? handshakes of redundancy ... as we exported your productivity to the real needy in the second and third world. ... Oh, well, all of you know the story better than I - so I will retire and just say - the POG has proved to be a counter-measure to weaker hegemon paper reserve currency - and so have some mine(o)rs - So, at the final analysis - you'll probably find your only pot of gold at the "REAL" end of the Rainbow - and then you've got to hold physical - right with you ... and now we know that any caballero or gaucho will tell you so! So better have some security and barter close to thee! cb2 - Arcticfox (04/27/02; 18:46:53MT - usagold.com msg#: 74455) Bonner... THE REVENGE OF GOLDby Bill Bonner"In due course the Japanese people will own over 70% of the world's gold! Wrap your mind around the implications of that!" Harry SchultzThe price of gold hit $305 yesterday. "BUY GOLDS!!" says the headline of a James Dines ad in Barron's. Dines, whose headline - it seems like it was only a few months ago - was "Buy Internets," now believes that it is gold stocks that are in "RAGING UPTRENDS!""If you honestly want to make money, it is obvious that you should be interested in uptrending stocks," says Dines. Internets, as all the world has noticed, are no longer in uptrends. Even "downtrend" seems too gentle to describe the white-knuckled descent of the companies Dines used to recommend. Perhaps "death spiral" would be more appropriate. Many of them went down so far, so fast, they will never get up again. But the trends have changed. One of James Dines' 61 "Dinesisms," explains the ad, is that "a trend in motion will continue in motion until it actually ends." We will not dispute this. In fact, the crystal elegance of this dictum makes us wonder about the 60 other "Dinesisms." In fact, we have a suggestion for a 62nd one: "The price of gold will go up...unless it goes down. Or nowhere."Dines thinks he knows what direction gold is going in. "It's an actual fact that golds and silvers are in uptrends," continues the author of three-score and one Dinesisms, "and have been outperforming the rest of the stock market. Serious money is made by getting into bull markets early, before the crowd 'gets it', and precious metals have been sneaking quietly higher, unnoticed by the crowd..."We've been urging you to buy some gold, too, dear reader. Not because we know something...but because we don't.There are so many things we don't know, we hardly know where to begin to describe them. We do not know how long the world will continue to accept dollars in exchange for goods and services, for example. Nor do we know how long American consumers can continue to spend money that they don't have. Nor do we know when real estate markets might turn downwards, ending the illusion of additional wealth caused by rising house prices. But in a world with so many unanswered questions, gold seems the perfect thing to own.There was a time when we thought we could predict what would happen in the markets. But today, even the dim recollection of those days brings a sigh of regret. How could we have been so nave, back in the 1970s, we ask ourselves? How could we have been so foolish and so cocksure back in the 1980s, we wonder? Ah...but then, we had the confidence of youth...the knowledge of the innocent...and, most importantly, we had hair.But by the 1990s, we were losing our mane and gaining our doubts. Age and modesty were beginning to catch up to us. Nature, in her majesty, had already found many ways to separate us from our dignity and our money; we had to conserve what little we had left.When forecasters told us - back in the '70s - that gold would rise to $5,000 an ounce, we believed them. For what would stop it? Government was inflating the currency. Government always inflated currency - if it could. There was no example from history of a currency that had not been inflated away to a bare trace of its original value. Why would the dollar be any different?The logic of that argument was persuasive then, and still is. But the timing proved difficult to forecast. In a better world, predicting the course of future events would be much easier. If man were merely the homo economicus that economists think he is, he could be expected to do the rational thing at the rational time.Back in 1971, for example, the rational thing would have been to sell dollars and buy gold. Gold had an established track record dating back thousands of years. It got excited when compared to paper currencies - jumping up and down with the fashions of the time. But, in terms of what it would buy, gold seemed extraordinarily calm. Through many generations of trial, and mostly error, humans had discovered that paper currencies eventually drifted away to nothing - unless they were anchored to gold or some other solid rock of value. Thus did the Western money system of the 19th century function so well - the major nations, Britain, France and America, had currencies tightly moored to gold. At the end of the century, the franc, the pound and the dollar were nearly in the same place as they had been at its beginning.But the 20th century brought changes. "The classical gold standard died like a soldier in WWI," writes James Grant. Governments yield to emergency like a dieter to devil's food. In war, for example, restraining influences - gold, habeus corpus, and common decency - give way to mass hysteria. We have already described how the emergency of WWI effectively bankrupted all the major belligerents - save one, the U.S.Britain, France, Germany, Russia - all were on the brink of destitution in 1919. They had lost millions of young men, and billions of dollars, but they had not completely lost their senses. A movement to re-establish the gold standard began almost as soon as the fighting stopped. But it wasn't until early 1924 that Germany ended its hyper-inflation by tying the mark to gold. Then, on the 28th of April 1925, Winston Churchill - then chancellor of the exchequer - announced that the pound would be once-again convertible into gold, as it had been before the war - and at the same rate! "Why did he do something so stupid?" John Maynard Keynes asked. Answering his own question, Keynes said he believed Churchill was led to his biggest mistake (perhaps even worse than his Dardanelles campaign in WWI) by his own advisors - notably, Norman Montagu, England's chief central banker at the time. The rate was too high. During the war years, Britain had expanded its money supply and run up billions in debt - most of it to the U.S. The general price level in Britain had doubled between 1914 and 1918. Unemployment increased in the post-war years. And exports, even by 1924, were still down 25% from their levels of 1913.A reasonable man might have concluded that the pound - loosed from gold - would likely float lower. It did. But then, a bull market in the pound in the early '20s produced a "sensational" run up in sterling. By 1924, the pound was once again trading at pre-war levels. Taking the bait, Churchill fixed it by law. The result was disastrous. "The revenge of gold," declared the French newspaper, Le Temps. Churchill realized his error almost immediately. "Something terrible is beginning to happen to the economy," he said, adding "If that happens I hope Norman Montagu will be hung.""It was the biggest mistake of my life," Churchill later said to his doctor. General Foch, returning from a visit to London in June 1925, described the situation:"England's government coffers are full. But the economic situation is poor...and its industry is operating at half-speed. From every side, you hear complaints that British producers can't possibly compete with foreign suppliers..."Churchill's mistake had far-reaching consequences. As England grew weaker, Germany grew stronger. Another French commentator: "We thought Germany had been sidelined for a long time, if not forever. But barely 7 years after the war, she has become an even more dangerous rival."Churchill's mistake did nothing to enhance the glory of gold. Many believed it was the gold standard itself that was at fault...a few even blamed it for the '29 crash...or for the inability of the government to correct the Great Depression that followed. Alas, the gold standard had entered a bear market...More to come...Your editor, always trying to connect the dots...but no longer so sure what picture it will give him...Bill Bonner mikal (04/27/02; 17:11:27MT - usagold.com msg#: 74454) @Anduril Re: Last post to Cavan Man. Thanks! I find that I am balancing more and more of my physical precious metals to the yellow, over the last year because of posts like yours. (Also, I have found AU much easier and safer to store). Although I disagree that Ag will devalue, your explanations are highly useful, revealing much insight into the behavior of large investors and a likely complete severance of silver's monetary and reserve status. I can only hope that those who believe in honest money will at least have some gold. Hydro (04/27/02; 16:56:51MT - usagold.com msg#: 74453) Boilermaker: correction (I hope): Regarding Boilermaker's comment:"Buenos Aires is a beautiful city with a vibrant nightlife (at least when I was young enough to enjoy it). The country is like Italy, no stability but lots of action. I sincerely pray that the Argentinians will find a true leader who understands what has happened and why it happened and will proscribe remedies that will return this wonderful country and its people to prosperity.We Americans will need a similar leader in the not too distant future."I hope you meant to say "prescribe" (to lay down a course of action) instead of "proscribe" (to prohibit). We already have too many leaders in the US who proscribe remedies to return our country to freedom and prosperity; they are called "Democrats", and many others are called "Republicans". Andϊril (04/27/02; 16:32:39MT - usagold.com msg#: 74452) Cavan Man: "Why?" Men take wives. Why?Men specialize in labor. Why?Men gather gold. Why?Through the long course of human events, we see what there is to see. No thing more, no thing less. This trend is real and it has yet far to go at slopes first steeper then flatter.Something there is among economic peoples that rises to the position of pinnacle wealth. If not the #79 atom, then something else in its place. Does it matter to this gold discussion what the # or compound is if men give it the name "gold" just the same? For us, #79 it is that carries this name, and we march to that music of our forebears.This pinnacle thing (gold by any other name or number) by definition draws forth a predictable response relative to all things. As primitive men rise up to join the cities, they leave their pagan tools behind. No longer do they drag their knuckles under the weight of stone tablets, bear skins and copper wheels. These are sold at falling value for lines of credit, cellular phones, Armani suits, BMWs in the fast lane and a personal vault of gold.How does this happen? The First World grows, and the Third World leaves behind the deserts and forests faster than gold is mined to fill their modern lifestyle.The banking structures of the past century have done much to mask the economic separation of gold and silver. This has been well covered by others and need not be repeated now. As these old influential effects continue to fall away under the learning curve of each generation, the slope will approach vertical as the gold value is reasserted even as old silver hoards join with the steady stream of aluminum cans sold to the recycler for a buck or two. The formative stages of this movement is now under way. mikal (04/27/02; 15:39:29MT - usagold.com msg#: 74451) @Anduril It is good to see you posting often this week. Your work reveals a profound perspective similar to FOA, Sir Douglas. Thank you very much for your comment re: silver. Please let me know if I am underestimating the above-ground silver supply, by my holding significant physical Ag. I wish to say that I greatly appreciate all your posts and look forward very much to your opinions and fellowship. Boilermaker (04/27/02; 14:38:27MT - usagold.com msg#: 74450) Argentina falls further into the "abyss" http://biz.yahoo.com/rf/020426/argentina_6.html POCKETS EMPTY "I have some cash but not enough to make it through the weekend," said Graciela, a marketing manager and mother of two. "I can't withdraw my salary; stores won't accept my bank cards, so now I have to choose what I will stop buying." Argentines had already been cutting back on all but necessary goods since January's devaluation sent the local peso currency plummeting more than 70 percent against the dollar, to which it had been pegged at par for more than a decade. With inflation soaring, supermarkets sold 15 percent fewer goods last month than in March 2001. Some academics urged the International Monetary Fund to act to revive the comatose banking system now that an estimated half of Argentina's 36 million people cannot meet their basic food needs or cover their cost of living. One apparently good piece of news was Duhalde's pact with powerful provincial governors on Wednesday to heed calls from foreign lenders to rein in high public spending -- which forced Argentina to default on $140 billion in public debt this year. The IMF, which has held back aid awaiting concrete action on long-promised spending cuts, has yet to react; but U.S. Treasury Secretary Paul O'Neill, an acerbic critic of Argentina's spending habits, hailed the provincial pact and urged the government to "move forward in close contact" with the fund. Still, some economists ridiculed the deal and looked askance at possible government plans to peg the exchange rate after four months of a free flotation which was demanded by the IMF but has sparked inflation and banking chaos. Other economists questioned the effectiveness of a new law meant to stem the exit of bank deposits. Instead of swapping deposits for bonds, it would require the Supreme Court to rule on all appeals against the deposit freeze. "Thursday our executive board studied the new law and our unanimous opinion is the law is unconstitutional," said Angel Bruno of the Argentine lawyers' association. However, the Supreme Court on Friday suspended all bids to free deposits from the system, overruling decisions by some lower court judges across the country who had opposed the law and went to some banks demanding cash be handed over. Banco Provincia, Argentina's second largest bank, earlier closed its head office an hour after opening when court clerks showed up with a lawsuit demanding the release of deposits. A bank manager in the poor northern province of Formosa told pensioners and unemployed people eligible for $50 in dole money that he could only offer them provincial bonds since no cash had been sent from Buenos Aires. "We are going hungry. We are not trying to loot the bank; we just want our own money back," said a woman in the line outside his branch of the Formosa provincial bank before protesters pelted the building with stones. Boilermaker comment;Buenos Aires is a beautiful city with a vibrant nightlife (at least when I was young enough to enjoy it). The country is like Italy, no stability but lots of action. I sincerely pray that the Argentinians will find a true leader who understands what has happened and why it happened and will proscribe remedies that will return this wonderful country and its people to prosperity.We Americans will need a similar leader in the not too distant future. Christian (04/27/02; 14:27:10MT - usagold.com msg#: 74449) GDP Private spending, being more efficient than state spending, does little to boost GDP figures. An entity can contract out services needed to reduce the cost and in the process reduces the GDP figure. On the other hand an entity can waste money in fraud, inefficiency or bribery- all these sums are counted as part of GDP. Selling a stock be it at a profit or loss is part of GDP. People use their homes as income. 1/4 of all homeowners refinance their homes every 5 or less years, 1/2 every 7 years or less, 1/5 every 10 years or less and the money taken out to spend is part of GDP. More people will file for bankruptcy than graduate from college and all is counted as GDP. Debt is not part of GDP. Private debt is expanding at a rate of 10% a year. Public debt is expanding at a rate of 20% a year. The government reports a 5.8% GDP increase.You can not borrow yourself out of debt. When it is all said and done as long as investors believe in paper confetti their wealth will be absorbed by physical metal buyers. The coming political and economic brekdown will force the government to revert metal backed money to reliquify. Cavan Man (04/27/02; 14:21:10MT - usagold.com msg#: 74448) Anduril Why? Andϊril (04/27/02; 14:07:17MT - usagold.com msg#: 74447) darkhorse: "any idea where silver might end up?" http://finance.yahoo.com/m5?s=XAU&t=XAG&a=1&c=2 Beating this dead horse, we do not expect him to run differently in time. This trend you see will continue as silver is sold for gold. Silver will not "end up" as you ask. It will end down. darkhorse (04/27/02; 13:33:28MT - usagold.com msg#: 74446) (No Subject) I'm just a bit excited about the recent outlook for/behavior of our favorite spot on the table of elements. Technicals, fundamentals, geo-politicals, economics, hedging, media exposure...the list goes on and on in favor of gold. I've noticed more opinions have been putting gold to at least $1000 before all is said and done. Anybody got any idea where silver might end up? Old Yeller (4/27/02; 12:40:21MT - usagold.com msg#: 74445) Hello,Steve H Good to see you.Hope all is well and you are enjoying the latest positive twists in our favorite market.We have watched many icons and organizations fall due to factors we were all well aware of months and sometimes years before the "surprise" announcements in the mainstream media.CNBC will join the club of the totally discredited and despised,it's just a matter of time now.I agree completely with your views,their slick,one-sided presentations of business and economic "facts" borders on criminal.Just remember who owns them,the little GE shop will produce many horrors before this stock promotion to end all stock promotions is deconstucted. Cometose (4/27/02; 12:02:58MT - usagold.com msg#: 74444) EPILOGUE / IN THE FOOTSTEPS OF GIANTS P67 /MK EDITOR "What would I consider to be ANOTHER's most important contribution after spending all this time with it? I would have to say it is the revelation that the recent "good years" in the economy have been the result of a quid pro quo between central bankers and the oil states: that the latter would supply cheap oil in terms of dollars as long (as) they could receive gold in exchange. If true, it is this "understanding"' , as ANOTHER calls it, that paved the way for the longest period of sustained economic growth in the 20th century. It explains the long-term strength of the stock and bond markets not only in the United States, but thourghtout the industralized world. One can only imagine the consequences if the quid pro quo is removed from the current economic equation, though ANOTHER provides some frairly well developed scenarios if such a thing were to occur."Another (thoughts!)Resonse to ) A. Goose: Nothing is assured! Life is a risk and subject to many changes . I ask you, if the USA could not remove the Iraq leader when they were in full battle dress, then???? No, the US tanks are not a factor in this . The risk is to each person and how they hold their wealth. The concept of what wealth is , is going to change. Concept is but a thought and a thought of what value is, changes thru life. time will prove all things.Hugo Chavez is reinstated after a brief interruption........ and the dollar begins exhibiting more damatic weakness... and the US Stock market dramtically moves below key support levels......my, my ,my.........what are we, here, on the threshold of????? Rockgrabber (4/27/02; 12:01:01MT - usagold.com msg#: 74443) Mid-East and its dependency to our dollar BULL@%#$ Just caught on Fox News a segment with Daniel Yergin author of "The Prize," a book on oil. He is suppose to be an expert. His claim was the same as everyone elses, they cannot oil embargo us cause they depend too much on our dollars. Very shallow thinking I would think. What if they give us an embargo, and cut to half of what they are now pumping? WHat would that do to the price of oil? More importantly are these not "The Giants" whose tracks we have been walking. If they cut production by half, with an embargo to the west, their "real gold" goes to maybe thousands, crushes our paper markets in a panic, along with our very fragile banking system right now, they keep much oil in the ground, are you sure they would not like that? Europe is now very well proved that they have worked out the flaws in the Euro. What do they need our dollars for? They have already used them for what they wanted them for, Gold. Why not show your Ace now? Let China build up, with the emargo to the west. Let them send their pollution across the Pacific into America (I think they see it that way). Sell cheap oil now to China and let them become dependent on it. Embargo only the west. They are only cutting old worn out bridges, and building better new ones it looks. Arcticfox (4/27/02; 11:57:53MT - usagold.com msg#: 74442) Hedges What I don't understand about this hedging is say a gold company is forward hedged at $310.00 US and gold goes to $350.00 US. Can't they still supply back the borrowed gold from their production and only loose out on the 40 dollar profit. For example, Newmont is letting their(Normandy's) hedgebook expire naturally. They would only run into trouble if the entity that they borrowed the gold from demanded all of the physical right away and the gold company had to go into the spot market and pay higher prices. Now if a bank is facing this predicament, can't they just buy call options to cover themselves. I quess I don't understand how hedgebooks can go "under water". What am I missing? mikal (4/27/02; 09:36:06MT - usagold.com msg#: 74440) @Hipplebeck Interesting possible outcomes. Too bad that isn't the only region without security and mutual understanding. So many problems and issues remain unresolved on account of ignorance, greed, etc. Most foreign policy "analysis" is just beating a dead horse, delaying progress. The countries' politicians who sponsor war should return to the front lines like their ancestors, they would not be so quick to advocate war. SteveH (4/27/02; 09:09:42MT - usagold.com msg#: 74439) CNBC Something they do seems to raise hackles. Why? It isn't so much what they do but who they don't air. According to them the US is well on its way to recovery. They dwell on the common economic statistics, but ignore derivatives, bears of substance, and commodities. As such, they take the bull position and go overboard in creating a picture of an economy in recovery, without fullfilling their journalistic imperative of unbiased reporting. They are unabashed cheerleaders to a stock market of days gone bye, hoping to 1)not contribute to a bear market by negative reporting and 2) create an image of a healthy economy even to the extent of avoiding significant danger signals or properly emphasizing the importance of same, when they do mention them. Rock (4/27/02; 06:42:46MT - usagold.com msg#: 74438) Food for thought 50 billion dollars was lost in one day in the great 1929 stock market crash, that sounds pale in comparison to what the market has lost in 2002 yet the wall street pimps keep telling us there is no recession. AOL Timewarner recently lost much more than than 50 billion and thats just one company. Whats up with that? Sir Rock Hipplebeck (4/27/02; 06:15:57MT - usagold.com msg#: 74437) *----O The symbol on the subject line above is a bomb with a lit fuse.That is how the Middle East problem looks to me.The US war on terrorism has now morphed into a war between Zionists and Islamists with the US caught in the middle. Instead of being the worlds only superpower, the US has become the worlds most important pawn.If the US does not restrain Isreals expansion into the West Bank, then the Arab countries are going to wield a much bigger weapon than oil, they are going to take down the US financial system, and they have the ability to do it.The Bush administration is attempting to play both sides, but as I've said many times when you do that, both sides end up hating you.Apparently you cannot get elected for any office in this country if you have the Jewish lobby against you, so Congressmen are making sure that the Jews know whose side they are on.The most important and explosive piece of real estate on the earth right now is the temple mount in Jerusalem. It is the linchpin in this great struggle. It symbolizes who's got the covenant.The game of "stretch out the negotiations while taking over on the ground" has been exposed and is over I think.I believe that there is not the political will in this country to restrain the Zionist dream, so it looks to me like we are headed for a war against all of Islam.If it is not a shooting war, then they have the advantage.It is a matter of dollar flow.The media is already demonizing Saudi Arabia with the "money to suicide bombers" and other stories, so I think we will turn on them and label them part of the axis of evil eventually.If you have not bought physical gold and put it in a safe place then you have not taken out insurance for your family. Boilermaker (4/27/02; 05:44:01MT - usagold.com msg#: 74436) EagleOne About 20 years ago I worked for two years on coal water fuel (CWF)development for the B&W Company. That was a response to the 70's oil crisis that forced us to think about alternative fuels. We even built a CWF production facility to produce demonstration quantities, 20 tons per hour, of fuel for test burns. At that time CWF was envisioned as a replacement for oil and gas fired boilers and in fact CWF could be fired in burners that resemble oil burners. However, the major stumbling block was the fact that O&G fired boilers are designed to burn (per cubic foot of furnace volume) about three times the fuel quantity (BTU's) compared to coal. This ratio reflects the need for much longer furnace residence times needed to combust coal even when it is ground to powder size and the fact that bituminous coal contains significant amounts of ash (anywhere from 5 to 30%) that is entrained in the gas stream leaving the furnace. The ash leaving the furnace must be cooled to a tempeature below its softening point so that it does not cause excessive slagging in the superheater and the velocities in the convection passes (superheaters, boiler surface and economizers made of tubes) need to be reduced so that the erosive effects of the ash will not wipe out the boiler's guts. All this means that boilers designed for oil and gas normally require a two or three to one derating on coal.Of course there was also the need to add gas cleanup systems for any conversions.Another factor that helped kill CWF was that the railroad lobby prevented CWF pipelines projects from employing eminent domain for right-of-way aquisition. In the early 80's when oil was priced above $20/bbl and coal was $10-15/ton there was a strong incentive to make this work even with the problems noted above. However as soon as oil dropped below $20 most of these projects died and remain idle. My best guess is that these alternative fuel projects will start to reemerge when prices exceed $30/bbl and gas goes over $6/mcf. Some will become economic when prices reach $50/bbl and $10/mcf. However, these prices must be seen as stable and not boom and bust because of the tremendous amounts of long term capital needed for alternate fuel development. It is my opinion that had we experienced gradually rising O&G prices from the 80's forward instead of $10/bbl oil $2/mcf gas, we would now be relatively independent of foreign imports. Sort of like letting the price of gold rise to provide the kind of financial and monetary disipline that a free market for gold would have imposed. Many other alternative fuel ventures have had a similer history but they will reemerge when the market is right. Gold Standard (4/27/02; 04:29:36MT - usagold.com msg#: 74435) Fuel Cells Many thanks, Sir BB - but I still reckon that safe and efficient hydrogen gas storage for mobile applications is the "Holy Grail", where you have direct combustion of the stored hydrogen, thus obviating the need for a fuel cell.This, of course, assumes an infrastructure of delivery - i.e. "gas" stations that actually provide "gas" rather than petrol. It also assumes efficiency of capacity, in that you will get several hundred km from a tank of "gas", and not have to refill too often.Fuel cell technology, such as (I think) Ballard Power Systems in Canada (with HUGE financial backing from Ford, GM and DaimlerChrysler) is more or less considered a "stop-gap" to a full hydrogen-based fuel system, insofar as the delivery system is unchanged - one would still fill up with petrol, but the fuel cell cracks this into hydrogen, which is the combustible material.I am in no way an expert or involved in this industry, but I would have thought that the money being spent on fuel cells for hydrogen combusting engines would be MUCH better spent on the delivery infrastructure.I have owned LPG (Liquified Petroleum Gas) cars in the past, though not CNG. The filling procedure is not difficult, and hydrogen delivery should be no different. The problems with hydrogen as I see are:-1. Low thermal efficiency of the combustion process - i.e. less "bang for your buck". You either need to comparatively use a lot more of the combustible material (hydrogen) to garner the same performance, or suffer a significant performance reduction. This applies to either "full" hydrogen, or a fuel cell use.2. You would have to have highly pressurised tanks and delivery systems, to provide sufficient hydrogen not to be an inconvenience (i.e. filling up every 100 km). This creates a safe storage problem.3. Assuming that the delivery/performance problems of hydrogen are sorted, we then have the situation where there is available to the general public a non-polluting and (presumably) relatively cheap means of personal transportation. Wonderful stuff, but the traffic jams, road trauma rate (people will still be idiots despite technology) and lack of parking facilities will create its own urban chaos.Then again, I've always wondered what would happen to a rescuer who attends to a collision between two electric vehicles..... Zzzzzzap? BB, maybe the whole social infrastructure pertaining to personal transportation should be looked at - otherwise events may overtake us faster than we realise! Black Blade (4/27/02; 03:39:50MT - usagold.com msg#: 74434) Gold Standard Fuel Cell That's a good question. It has much to do with politics and political correctness. There a loss of energy by cracking the NG for the hydrogen. However, this is the environmental flavor of today. Some have flights of fancy and believe that the hydrogen will be separated from water. The problem is that the energy required is about as much the net energy gained from the hydrogen used in the fuel cell. To make hydrogen from water by using high-voltage electricity is expensive (about $2.40/kilo more when factoring in the cost of building facilities to make hydrogen, pipelines, distribution, etc.). The cost of hydrogen from hydrocarbons such as natural gas with steam is cheap (about $0.65/kilo with similar costs for facilities, distribution, etc.). Of course if is possible that some fuel cells will simply use NG or some other stored hydrocarbon as fuel and the hydrogen separation take place in the vehicle. However, most planned fuel cell vehicles are based on the premise that hydrogen (as liquid or compressed gas) will be stored in a special tank on board. Fuel cells on busses are one thing, on small compact vehicles are another. The safety concerns are well founded. From a practical standpoint, it may be easier to just use NG as a fuel since many homes have NG pipelines and major pipelines can be directed to distribution centers. I have stated in the past that the Hindenberg was a fuel cell. I was joking of course, but you can imagine the danger of millions of four-wheeled Hindenbergs rolling down the nation's highways. I have a friend who experienced the danger of an exploding propane tank on his work vehicle a few years ago. He was not amused. Just imagine if it was a tank of compressed hydrogen gas. Some major cities have large "stacked" fuel cells for critical services such as city buildings, hospitals, etc. There of course run of natural gas. There are those who propose using fuel cells in new construction of homes and businesses for generating onsite electricity. It could work I think. I am not sure of how it works other than the carbon is filtered out in a "scrubber" and collected or discarded once the hydrogen has been separated. At least in many areas there is enough infrastructure for home and business based fuel cells for on site power generation. Still widespread use of fuel cell technology is decades away if ever.Cheers!- Black Blade Black Blade (4/27/02; 03:11:42MT - usagold.com msg#: 74433) Five Killed in Attack on Israeli Settlement http://story.news.yahoo.com/news?tmpl=story&cid=586&ncid=721&e=1&u=/nm/20020427/wl_nm/mideast_attack_dc_4 Snippit:JERUSALEM (Reuters) - Five people were killed when one or two Palestinian gunmen attacked an Israeli settlement in the West Bank Saturday, the army said. "Five people have been killed" and six wounded, one seriously, an army spokeswoman said after the attack on Adora, a few km (miles) west of the divided city of Hebron. There was no immediate word on what happened to the attacker or attackers. The army said it was searching the area. Black Blade: Tit for tat. There is no solution to the ME violence. Best to just let them alone to do what they do best kill each other. We have more to lose by supporting one side over the other. All we should be concerned about is a secure supply of oil. Of course on the bright side if this situation escalates the POG should rocket higher. Gold Standard (4/27/02; 03:01:48MT - usagold.com msg#: 74432) @ BB - energy options Sir BB, I always enjoy your informative posts re energy, and your refreshingly scary "inside" information.However, your 74429 post re NG has me somewhat confused.You say in part:"If fuel cell technology becomes viable it {Natural Gas} will be the main source of hydrogen fuel."I always thought that fuel cells were a "stop-gap" solution pending safe and efficient hydrogen storage for mobile transport purposes.Why would one not simply burn Natural Gas or CNG, rather than putting it through a fuel cell to produce hydrogen (which you then burn in any case), for a depleted BTU quotient.Sir BB, I'm not criticising, but perhaps you could expand on this?Cheers! Black Blade (4/27/02; 02:56:05MT - usagold.com msg#: 74431) Once upon a time in Jenin http://news.independent.co.uk/world/middle_east/story.jsp?story=288592 What really happened when Israeli forces went into Jenin? Just as the world is giving up hope of learning the truth, Justin Huggler and Phil Reeves have unearthed compelling evidence of an atrocity25 April 2002 Nurse shot through heart and man in wheelchair among Jenin dead Snippit:The thought was as unshakable as the stench wafting from the ruins. Was this really about counterterrorism? Was it revenge? Or was it an episode the nastiest so far in a long war by Ariel Sharon, the staunch opponent of the Oslo accords, to establish Israel's presence in the West Bank as permanent, and force the Palestinians into final submission?The rubble in Jenin reeked, literally, of rotting human corpses, buried underneath. But it also gave off the whiff of wrongdoing, of an army and a government that had lost its bearings. "This is horrifying beyond belief," said the United Nations' Middle East envoy, Terje Roed-Larsen, as he gazed at the scene. He called it a "blot that will forever live on the history of the state of Israel" a remark for which he was to be vilified by Israelis. Even the painstakingly careful United States envoy, William Burns, was unusually outspoken as he trudged across the ruins. "It's obvious that what happened in Jenin refugee camp has caused enormous suffering for thousands of innocent Palestinian civilians," he said.The Israeli army insists that its devastating invasion of the refugee camp in Jenin earlier this month was intended to root out the infrastructure of the Palestinian militias, particularly the authors of an increasingly vicious series of suicide attacks on Israelis. It now says the dead were mostly fighters. And, as always although its daily behaviour in the occupied territories contradicts this claim it insists that it did everything possible to protect civilians.But The Independent has unearthed a different story. We have found that, while the Israeli operation clearly dealt a devastating blow to the militant organisations in the short term, at least nearly half of the Palestinian dead who have been identified so far were civilians, including women, children and the elderly. They died amid a ruthless and brutal Israeli operation, in which many individual atrocities occurred, and which Israel is seeking to hide by launching a massive propaganda drive.Black Blade: Quite a few stories of Israeli "homicide troops" invading Jenin and participating in cold blooded murder and mayhem. This is what has stirred up the Arab world and may result in the use of the Oil Weapon against the west and it will result in more terrorism. The Israeli response is very reminiscent of the attitude demonstrated by the Israeli "homicide military" after the Israeli terrorist sneak attack on the USS Liberty. Meanwhile Israeli homicide troops have retreated from some areas only to reenter others. The ME situation is no closer to being over than before. Black Blade (4/27/02; 01:50:02MT - usagold.com msg#: 74430) Dollar most overvalued in 16 years - Big Mac index http://biz.yahoo.com/rb/020426/markets_dollar_bigmac_2.html Snippit:NEW YORK, April 26 (Reuters) - Despite being nibbled down to multi-month lows on Friday against major currencies, the dollar is considered at its most overvalued point in the 16-year history of The Economist's Big Mac Index, which measures the cost of the ubiquitous sandwich in 120 countries. "Overall, the dollar now looks more overvalued against the average of the other big currencies than at any time in the life of the Big Mac Index," the weekly wrote in its April 27 edition. The Australian dollar is undervalued against the dollar by 35 percent, the most among the rich-world currencies. The Swiss franc and sterling, however are among the few overvalued currencies, at 53 percent and 15 percent, respectively, the newspaper wrote. Canada is undervalued against the dollar by 15 percent. The average cost of a Big Mac in the United States is $2.49. The cheapest Big Mac can be found in Argentina at $0.78 due largely to the devaluation of the peso from its decade-old one-to-one peg with the dollar in January. It costs diners $3.81 to feast on a Big Mac in Switzerland, currently the highest rate in the world. Black Blade: Hmmm Black Blade (4/27/02; 01:31:40MT - usagold.com msg#: 74429) EagleOne Power Generation Matt Simmons has been on the ball for a long time when it comes to energy. Sometimes I wonder about a couple of his underlings though. The way that I see it:Oil the US currently imports over 70% of its daily Oil consumption.Natural Gas The US has vast reserves of NG, though the infrastructure to utilize this resource is lacking. It is a favorite of environmentalists because it is clean burning. If fuel cell technology becomes viable it will be the main source of hydrogen fuel.Nuclear This is perhaps the best choice for power generation. It is more costly though that is mainly due to regulatory matters than anything else. However, there are many who do not understand Nuclear energy and they oppose Nuclear power based on misunderstanding and the disaster at Chernobyl (a graphite core design) and hysteria over the Three Mile Island incident. Chernobyl was a disaster from the beginning and there are many such designs in the Third World (mostly Russia and eastern Europe). The containment structure at Three Mile Island performed as designed and no real release of radiation above background levels occurred. The best Nuclear Power generating facility may be the Pebble Reactor design (one pilot project operated in Germany for over 20 years and one is being considered for construction in SA). The problem for Nuclear is political more than anything else.Coal The US has nearly 350 years of supply at current rate of usage. There is the possibility of "clean coal" technology. Unfortunately the problem here is more political/environmental than anything else. The environmental regulations are piled on year over year and the restrictions along with "carbon credits" will likely reduce coal fired power generation for years to come. There is some coal slurry projects underway such as that done by Silverado Gold Mining (which is branching out from Gold of course), and Sasol of SA has been manufacturing coal oil fuels for years. The political reality is that coal will be under pressure until the next real energy crisis that hits the average American. When mom can't watch all my children, little Johnny can't view porn on the net, and dad's beer is warm that's when there will be a cry for using coal to generate power. Hydroelectric simply put there isn't anywhere left to build any new dams. Besides, the regulatory hurdles are insurmountable. In fact there is a growing movement to dismantle the dams on the Columbia and Snake Rivers to save the salmon (though it's way too late for that they're good as extinct). Tidal wave generation this is decades away from reality. Already environmentalists are opposed as it may interfere with migratory patterns for sea mammals and fish. It also could be a costly proposition even if it could pass the regulatory hurdles. The other questions are where to put these facilities. Care must be taken to avoid areas of intense weather and shipping lanes. Solar this is difficult to say. The parabolic mirror design as that used in So Cal in the Mojave Desert (Kramer Junction Company) is not very efficient and without government grants and subsidies they would be out of business due to the great cost. A new parabolic design shaped like a satellite dish has more promise. The mirrors focus a beam on a salt solution cylinder that heats up and in turn heats water to steam for power generation (the KJC design heats cylinders of oil which dissipates heat quickly). Here again environmentalists are opposed as it "offends the eyes" and takes away from the "aesthetic value" of the landscape. There is some promising new solar research at Bezerkley that is interesting though such as the "spray-on" plastic solar sheets. Such new technology may be years off and the cost effectiveness is uncertain. Of course the sun does not shine at night either. Wind Also known as "Quisenarts for Birds". PETA (not People Eating Tasty Animals the other one) and several environmentalist groups are opposed to Wind generated power as raptors and other birds are for some reason attracted to windmills and when they approach the slice and dice begins. Windmills have been a concern for the California condor as well as slow flying eagles. Many even are opposed as the windmills are unsightly and again "offend the eyes". Of course the wind does not always blow and sometimes the winds blow too hard and the windmills are shutdown. The windmills at Altamont Pass in northern California have been responsible for numerous grass land fires and have threatened many homes and ranches. Most if not all windmill farms are subsidized by the government (actually the taxpayer). There are no simple solutions to the growing "energy crisis". It is a given that we will see a severe energy crisis soon, possibly even this coming winter unless NG production kicks up a few notches. If this summer is hot as NOAA projects it will be ugly as more energy is consumed when air conditioners are turned on. After so many close calls around the nation and a small series of rolling blackouts in California over the last couple of years, virtually nothing has been done. Once the problem has passed it is no longer in the minds of the people (until the next crisis then it is always the fault of the power company, big oil, etc. go figure). This is a problem that will plague the nation for many years to come especially if the economy recovers and the "New Economy" grows. One average sized server farm consumes as much energy as eight 40-story buildings. Before the Recession there was about one server farm completed each week.It should also be noted that NIMBY is still strong. People are opposed to building more power generating facilities, transformer stations, building more transmission lines, building pipelines, etc. There are severe bottlenecks in the energy infrastructure across the nation. Just building power plants alone is meaningless unless there is a way to deliver the energy to where it is needed. The building of sufficient energy is highly unlikely as environmentalists are opposed to technology and the modern world (unless it affect them of course). Even the energy plan has been scuttled in the senate. So we can easily write off any economic recovery for the next several years. - Black Blade Black Blade (4/27/02; 00:21:50MT - usagold.com msg#: 74428) Don't laugh -- take a shine to gold http://cbs.marketwatch.com/news/story.asp?guid=%7BF14D8063%2D290E%2D4B45%2D91D3%2D9376E4A60C22%7D&siteid=mktw Commentary: It's not just for dreamers anymoreSnippit:But you need look no farther away than Argentina and France to see why gold still has its place in our financial system. It remains the ultimate hedge against the unknown catastrophe that might lie somewhere down the road. In Argentina today, he with a stash of gold coins is king. Its worth stands at a time when the banks are closed indefinitely, the currency markets are shut down, and people are literally beginning to run out of any acceptable "means of exchange" that they can use to buy the necessities of life.The French have memories of similar economic and financial chaos in their long history where the only reliable store of value was the gold bullion they kept in their bank in Geneva. What, some must be asking themselves, does the rise to political prominence of a fascist like Jean-Marie Le Pen portend for their future? The political climate in the Middle East also favors gold, since investors there have traditionally been large hoarders of that metal, again as a hedge against the unknown. Some of them must be thinking about accumulating more as worries mount about the future staying power of the region's autocratic regimes, including the House of Saud, regimes that have allowed the privileged few to accumulate immense wealth while leaving behind in poverty the increasingly revolutionary masses.As the list of countries and regions under stress grows, so will the interest in the ultimate financial hedge. Under such circumstances, $350 gold no longer seems just the impossible dream of gold bugs alone. Black Blade: Unfortunately the author of this article has some bizarre perceptions of Gold Bugs. However, he is right about one thing The price of Gold is more likely to go up than down. Also, the more positive reports on Gold in the "Mainstream Press" then so much better. EagleOne (04/27/02; 00:04:47MT - usagold.com msg#: 74427) Correction and link to Simmons http://www.simmonsco-intl.com/ Correction: out = our ViewYesterday's Discussion.
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