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

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ARCHIVED DISCUSSION FROM 3/28/2002
All times are U.S. Mountain Time

(Yesterday's Discussion.)

Sierra Madre (03/28/02; 23:51:33MT - usagold.com msg#: 72354)
Pizz: about your worries regarding a terrorist attack...

Just my own personal opinion regarding terrorist attacks:

Such an attack will likely come, but...the intellectual authors of the incident will not be those who are going to be blamed.

When the time comes for an attack on Iraq, some gruesome atrocity will be committed, which will so enrage the U.S. population, that pretty nearly 100% of the country will be all for a devastating attack on the "perpetrators", with no restraint on weapons to be used nor on the scale of human losses to be inflicted.

I have the sense that the war on Iraq has been firmly decided upon, and that public opinion will be efficiently mobilized when the moment arrives, through a self-inflicted attack. Zbigniew Brezhinski stated in his 1997 (?) book words to the effect that for the U.S. to establish a permanent presence in Afghanistan, some shocking event would be required to galvanize public opinion in favor of that military adventure. If the enemy won't give you the required shock - well, you give it to yourself. Presto!

It can so easily be done, you see. All the required resources are at hand. The oil is indispensable to the U.S., and Iraq represents a clear and present danger to Israel. So, as Madeleine Albright put it, "it's worth the price."

I apologize in advance if these opinions offend.

Sierra










Black Blade (03/28/02; 23:29:22MT - usagold.com msg#: 72353)
Nikkei Gets Beaten and Left For Dead
http://quote.yahoo.com/m2?u

The Nikkei 225 dropped over -308 points by the close.

Hipplebeck (03/28/02; 23:14:19MT - usagold.com msg#: 72352)
gold6000
You are missing the point. I am not talking about history. I am talking about reality on the ground in the everyday life of real people. The zionist dream is to have the whole country without any arabs, and to remove the dome off the mount so the temple can be built. If you haven't figured that out, then you can't see what's coming. Please, don't take offense at what I am saying, I am just calling it like it is. The connection to gold is obvious

Black Blade (03/28/02; 23:07:52MT - usagold.com msg#: 72351)
Puplava Market Wrap Up
http://www.financialsense.com/Market/wrapup.htm

Snippit:

Gold - A Barometer of Change

In addition to the technical indicators discussed above, rising gold prices don't bode well for the financial markets. Gold, once again, is assuming its historical role as a barometer of the financial markets. Key levels for gold are $305, $315, and $325. That is the price of many gold contracts that have been sold forward. If gold surpasses these levels, we could see the price take off like a NASA space launch. There is a technical barrier for gold at the $315-$320 level. At the moment, a fierce battle is being waged between central banks and their bullion bank partners to suppress the price. Hedge funds, Asian investors (especially the Japanese), and Middle Eastern investors are now heavy buyers of gold. The forces arrayed against the central bankers and bullion banks are a formidable one. As mentioned in yesterday's WrapUp, the battle is for investor confidence. Like a medieval siege, the defenses of the central bankers are being probed for weakness. The assault continues as the electronic herd continues to accumulate their positions.

Shorts vs. Longs

The gold market has held above $300 for two days. To the relief of gold shorts, many of the gold futures contracts have been rolled over into the June contract rather than settle in physical bullion. That may not always happen. At some point the smart players will start taking delivery, which is when the fireworks will really begin. The same battle is taking place in the silver markets where commercials are increasing their short positions close to record positions while non-commercials are increasing their long positions. The clear picture regarding silver is that if longs start to take delivery, the shorts would be cornered. The non-commercials are long by 36,681 contracts. Open interest on COMEX silver is 71,778. The commercials are short by 60,393 contracts as of the market close on 3/19/02 . There isn't enough silver on the COMEX to deliver into the longs if the non-commercial longs would demand delivery. The fate of the shorts is dependent on the mercy of the longs and the fact that the COMEX may not allow delivery in an effort to protect unnamed short positions concentrated in just a handful of accounts.


Black Blade: Puplava also tackles the Silver markets and a possible enormous short squeeze in the works. A good read.



Pizz (03/28/02; 23:00:29MT - usagold.com msg#: 72350)
(No Subject)
For about the last month or so, like many, I have had a fairly dramatic increase in anxiety over just what crisis will develop next from the "war on terror". It would seem we are overdue. As much as I would like to think our retoric and saber-rattling have been enough to have our enemies running for cover and cowering in their caves, tents, palaces, or whatever, I'm either way too informed or way too paranoid to believe the worst is behind us.

Now, assuming we do actually have an organized enemy running around out there (if not, we've surely wasted a few months GDP for nothing), as this tension builds, how long will it be before one or two really big players decide "enough is enough" and bail out of US assets?

Maybe I have too many cynical years behind me managing money, but my whole life has been spent trying to anticiapte the next "run on the bank" (from a business perspective) and compensate. In business it's the competition. World finance and trade is no different. Everyone out there wants some of, part of, or all of what the other has - and will do what it takes to get it. If you're starving - mentally (religious fanantisism) or physically (poverty) . . . . . . .

Now I understand why our government wants everyone to think that this is nothing more than a shooting war. Right now it's the terrorists two+ buildings and 3000 people and the US a few hundred "terrorists" and a bunch of blown up caves. As I've said before, there is no way the government can or will tell us officially that we're both broke and extremeley vulnerable financially. It's a sad state of affairs when we are to such a point that the truth would crash our own markets, but we're there.

Now, how soon will it be before the money managers world wide finally come to their senses and realize that the final battle(s)will be fought financially, and that the US is sitting in the perverbial straw house with the big bad wolf at the door. The govdernments already know it, but they still don't control all the resources. As these same governments and politicians posture for the next move, prop and massage the markets into complacency, and with the populace more or less - no, completely - in the dark (save for a few of us fringe radicals out there), do they realize they are creating a very nervous herd of cattle, ready to financially stampede?

I fully anticipate a preemptive terrorist strike before we unleash against "whomever". Right now, I don't think it would have to be very big, but just enough "noise" to stampede the financial herd out of the US. For the most part, we cannot be defeated militarily, but if we start to collapse financially and the rest of the world senses they are to be collateral damage, politically our war machine will be crippled and we go down in the flames of our debt and dollar.

If the enemy is out there and organized, he'll be moving soon. We're getting cocky again, and way too complacent. My instincts are on alert. Do your own due dilligence, but if your holding powder for more physical, I'd be inclined to use it, as it could get wet over the next couple weeks.

Hoping its just male menopause and paranoia,

Pizz



Black Blade (03/28/02; 22:59:00MT - usagold.com msg#: 72349)
Petroleum Prices Rise
http://www.mrci.com/qpnight.asp

It appears that the Israeli invasion of Palestine has begun and several arrests have been reported. Palestinian paramilitary organizations have vowed to respond with more attacks. This has helped push petroleum prices higher. Oil is now higher at $26.31/bbl. Distillates and natural gas are also rising.

- Black Blade

Black Blade (03/28/02; 22:52:01MT - usagold.com msg#: 72348)
Nikkei 225 Getting Pummeled
http://quote.yahoo.com/m2?u

The Nikkei 225 is off by -229 points and with a half hour to go. Meanwhile Gold is pulling by slightly - by 70 cents. Japanese buying is still strong as anxious Japanese ponder the April Fools Day Surprise that awaits at insolvent Japanese banks. As this is a holiday weekend in NY, we could see an all out assault on the POG in Europe.

- Black Blade

Operative (03/28/02; 22:15:57MT - usagold.com msg#: 72347)
@ Canuck and All
http://www.millennium-ark.net/search.html
The above link is one to store away in faves.
I ran across it doing research for the Y2K. Have found it invaluable ever since. Just type in the subject and I think you will find a whole list of research items on almost any survival topic is handed for you to view. EZ Happy Hunting.

GOLD6000 (03/28/02; 22:09:49MT - usagold.com msg#: 72346)
HIipplelbeck
I'm not sure what your post had to do with gold!

In the interest of fairness. Neither party is totally innocent but any fair reading of the history of the Israel/Palestine problem makes your simple-minded analogy laughable. Since this is a gold site, I will simply say that the Jews moved there over a period of many decades, purchased land and were granted a state by the United nations in 1948. The Arabs were offered a state also, which they rejected. Instead, the Arab countries determined to destroy Israel. The Arabs encouraged(promising they could go back after the Jews were dead) the Palestinians to leave Israel so the destruction could begin. The Arabs then attacked Israel, which they have done several times since. The Arabs threw 800,000 jews out of all the Arab countries in 1948, not even allowing them to take their property. I'm Irish and I can read history! Your analogy suggests you don't.

Buy physical Gold - the only real material wealth!!!

Black Blade (03/28/02; 21:56:42MT - usagold.com msg#: 72345)
Toqueville's Hathaway Sees More Upside In Gold Prices
http://www.futuresource.com/news/news.asp?story=i4239740238742224960

Snippit:

NEW YORK (Dow Jones)--Gold prices have been steadily rising for the last three years, but John Hathaway, senior portfolio manager of the Toqueville Gold Fund, believes the bull market in gold could last for another five to 10 years. "We're in the early stages," Hathaway said in a CNBC interview Thursday. He added that if the value of the dollar drops and the bear market continues, gold could do surprisingly well.

Hathaway advised investors to keep about 5% of their portfolios in gold. Gold stocks act not only as a diversifier, which does well when others don't, but are in for lots of upside, he said. The Toqueville Gold fund's biggest current holdings are Newmont Mining (NEM), Gold Fields Ltd. (GOLD), Harmony Gold Mining (HGMCY), Agnico Eagle (AEM) and Placer Dome Inc. (PDG).

Black Blade: Notice that most of the funds holdings are Non-hedgers? That is the reason that this fund outperformed other Gold funds. What is most interesting is the recent change of heart in the financial media toward Gold as an investment and as CNBC anchors Michelle Caruso and Ted David say - "a flight to quality". Gold as a diversifier – what a novel concept. Hmmm...


Operative (03/28/02; 21:47:55MT - usagold.com msg#: 72344)
Japan
http://www.tocom.or.jp/souba/souba_e.html
Volume a little off but hanging in they are.

Operative (03/28/02; 21:17:59MT - usagold.com msg#: 72343)
Tonight's Toast
With permission of this site's host and the table of reknown sages this newbie requests it's humble approach to make a toast to the gallent men of GATA.

With a Samuel Adam's held aloft, the tribute I wish to present are the words from Theodore Roosevelt. It speaks of battles well fought, of courage, of being in the fight.



To the Man in the Arena

It is not the critic who counts, not the man who points out how the strong man stumbled or where the doer of deeds could have done them better.

The credit belongs to the man who is actually in the arena; whose face is marred by dust and sweat and blood; who strives valiantly; who errs and comes up short again
and again; who knows the great enthusiasms, the great devotions and spends himself in a worthy cause; who, at the best, knows the triumph of high achievement; and who, at the worst, if he fails, at least fails while daring greatly, so that his place shall never be with those cold and timid souls who know neither victory nor defeat.

Theodore Roosevelt

"Cheers"



Hipplebeck (03/28/02; 20:59:58MT - usagold.com msg#: 72342)
strad
It's kind of like this:
I have moved onto the best part of your property, I have pushed you over onto the worst part. I now have you down on the ground with my boot on your neck and a gun at your head. You have to ask me permission to go anywhere and do anything. If you will accept being my wage slave, I will let you have a few of the small necessities of life. If you don't, well you and your family can die or leave. While I have you down, my friends are bulldozing your house and all your friends houses. We are building our new houses in their place. There is not enough water, so while I water my lawn, you don't get a shower. Understand?

Gandalf the White (03/28/02; 19:30:56MT - usagold.com msg#: 72341)
Whom was it that ask about Argentinean Silver Mines ? <;-)
NOTE: This sale of this mine was to obtain the necessary funds (in US$) to meet the requirements of a loan that the Argentinean miner had previously made !!!
<;-(
===
U.S. Company Signs Agreement to Purchase High-grade Martha Silver Mine and other silver exploration properties located in Argentina, to Boost Production.

BUSINESS WIRE)--8:08:00 PM ET Feb. 27, 2002
A major U.S. silver mining Corporation is pleased to announce that the Company has reached agreements in principle to acquire 100 percent interests in the Martha high-grade underground silver mine and other silver exploration properties located in Argentina, approximately 270 miles east of the Company's Cerro Bayo mine, and to make a strategic investment in Yamana Resources Inc. ("Yamana"), a mining company with holdings in Argentina.

The Martha mine contains 27,000 tons of very high-grade reserves and resources at greater than 150 ounces of silver per ton with further exploration potential. These transactions are subject to satisfactory completion of due-diligence, regulatory approval and signing of definitive agreements.

Upon completion of final documentation, the Company intends to immediately commence shipment of Martha mine's stockpiled high-grade ore to its 100 percent-owned Cerrp Bayo mine in Southern Chile, for processing. Production at Cerro Bayo is scheduled to begin in May of this year and was expected to produce over 82,000 gold equivalent ounces in 2002 at a total cash cost of under $150 per ounce. On a gold equivalent basis, the acquisition of the Martha mine is expected to increase Cerro Bayo's 2002 production 50 percent to 123,000 gold equivalent ounces and even further decrease cash operating costs.

Under the terms of the agreements, the Company will acquire 100 percent of Yamana-owned Compania Minera Polimet S.A., ("Polimet"), an Argentinean corporation, which owns the Martha mine and other silver exploration properties for total cash consideration of US$2.5 million. The payment will be made to Northgate Exploration Ltd. ("Northgate") in order to satisfy Yamana's total outstanding indebtedness to Northgate. Additionally, Coeur will acquire ten million common shares of Yamana, equivalent to approximately 10 percent of Yamana on a fully diluted basis, for US$600,000. As part of this investment, the present Company Chairman, President, and Chief Executive Officer, has agreed to join Yamana's Board of Directors.
====
<;-)

Black Blade (03/28/02; 19:20:24MT - usagold.com msg#: 72340)
Weekly Jobless Claims Climb Unexpectedly
http://story.news.yahoo.com/news?tmpl=story&u=/nm/20020328/bs_nm/economy_jobless_dc_13

Snippit:

WASHINGTON (Reuters) - More U.S. workers than expected asked for state unemployment aid for the first time last week, the government said on Thursday in a sign the labor market was still trying to find its feet amid a recovering economy.

The Labor Department (news - web sites) said the number of initial jobless claims rose 18,000 to a seasonally adjusted 394,000 for the week ended March 23. That was well above Wall Street's expectations that first-time claims would dip to 369,000.



Black Blade: I am glad that these numbers were "seasonally adjusted" or we would have exceptionally higher numbers. Not much of an economic recovery that I can see.


Black Blade (03/28/02; 19:07:24MT - usagold.com msg#: 72339)
Ford Selling Precious Metals to Reduce Stockpile


DETROIT -- Ford Motor (NYSE: F) Co . (F), which shocked investors earlier this year with a $1 billion write-off of the value of its stockpile of palladium and other precious metals, said the company has begun selling metals to reduce the stockpile. In its annual report filed with the Securities and Exchange Commission Thursday, Ford stated it is "in the process of reducing metals" by using methods "including market sales to the extent the market can absorb the metal in an orderly fashion."...


Black Blade: Nothing like selling at a loss. Of course as this recession continues, sales of autos will drop off precipitously.


Black Blade (03/28/02; 19:01:06MT - usagold.com msg#: 72338)
Starting Off Ugly In Asia
http://quote.yahoo.com/m2?u

The Nikkei 225 is off over -100 points. This is happening just ahead of the "April Fools Day Surprise".

Mr Gresham (03/28/02; 18:38:01MT - usagold.com msg#: 72337)
Interesting read on high P/Es
http://money.msn.com/content/p20068.asp?special=msn
See if this tickles your contrarian funnybones...

Actually, when you spend your life in the contrarian camp, you really welcome someone who comes out and makes the majority view's best case as coherently as possible, so you can refresh your own thinking against it. Being bullish, or being bearish, is not the problem. Being stuck is.

GoldnSilver2002 (03/28/02; 18:04:45MT - usagold.com msg#: 72336)
What did we expect aka GATA?
Today i was disappointed in a sense to hear G.a.t.a was muffled by the system,but not surprised.A case like this,at this point in history(enron,afghan,terrorists etc) would have likely brought the system to its very knees.Inevitably,this war will be continued on the gold front,the media front and finally the court of public opinion.The system had to quash this one,too much was at stake but those who looked saw their fear.

Last night i watched in fascination as the gold chart had a series of heart attacks every time it was punched down from 305 it bounced upward again refusing to stay down,kinda reminded me of rocky!Then i thought oh ya Gold,you think the big boys havent tried to manipulate you before?Gold which has been a form of money since time immemorial has seen it all!These fools who dare to play with a Giant like gold will ultimately be burned,The central banks wont sell all their Gold!!!The consequences are to dire.Gold once again smells inflation'smells uncertainty'smells the crumbling of a debt burdened society spending paper money backed by a promise(Enron!).There are 6 billion people in the world now and the fire has been lit.Gold will have some heavily muscled allies soon and when the world races for the gold there simply wont be enough to be had..at any price!So buy silver it historically has been worth a mans labour for one day,costs under 5 bucks,is in short supply,warren buffet and bill gates have it and can outperform even gold on an uptick.Buy gold ,buy silver you simply cant lose.You wont have to wake up one day and here "gold and silver went broke today their shares are worthless!"

Black Blade (03/28/02; 18:03:10MT - usagold.com msg#: 72335)
Re: Canuck – Water Storage

People have varying opinions. I have several plastic "milk jugs" that work just fine (though they originally held "Arrowhead" water). Some suggest that one purchase large water bladders or plastic drums for the purpose of storing water. I have always added a drop or two of Clorox to deter the growth of algae. Water is easy to store and to recycle every few months.

Every once in a while we hear of some tainted water in some municipal water system where some organism (such as giardia (sp), amoeba, etc.) has been found or some illness (such as Legionnaires Disease) results in city-wide or region-wide water alerts. It is always best to be prepared against situations beyond our control. Water storage is just another step on the way to a sovereign life of independence. Cheers!

- Black Blade


R Powell (03/28/02; 18:01:02MT - usagold.com msg#: 72334)
The Coin Guy/ Silver
Thanks for the information, especially some official confirmation of many persistent reports of localized silver shortages.
From David Morgan (3/27/02), concerning POS and the LBMA,
"As readers of my work know I have stated that the lows are behind us, and we are in the beginning of the precious metals bull market. I can not help but make one parting comment. Remember how I started last month's silver Investor issue? The LBMA had a near consensus that silver would only move ten cents for the entire year? Well LBMA here is a dime in a day!!!"
At a recent convention in Phoenix, Mr. Morgan speculated about $6.50/ounce silver by year's end but also mentioned > $50.00/ounce silver in 2003!

Solomon, thanks for adding to ski's list. May I quote you guys??
Rich

balzac (03/28/02; 17:44:33MT - usagold.com msg#: 72333)
HOWES LAWSUIT
My CONGRATULATIONS to an American Patriot, Mr. Reg Howe, from a Cdn. admirer.

Few men have the courage and the inspiration to stand against the Goliaths of government and finance. Reg, your sling may have missed the giant's head but your words have given him feet of clay.You spoke for the little people , the common man
and we thank you. In Cdn. Naval parlance "Bravo Zulu "well done.

Balzac


Golden Bear (03/28/02; 17:31:37MT - usagold.com msg#: 72332)
Canuck (msg#: 72331) End of 1Q02
http://www.thestreet.com/markets/billfleckenstein/10015253.html
Greetings Canuck,

Thoughts to begin with:

A freebee article on TheStreet.com by Bill Fleckenstein trashing end of quarter window dressing, and asking why investors would pay 25-35 times questionable earnings?

Interesting comments on IBM - taking out pension gains, IBM's earnings grew a poor 3% in the mother of all bull markets...methinks GreenSham's productivity miracle, oops I mean mirage, will be studied by fianacial historians for centuries to come...

Also comments from Scott McNealy of Sun, asking investors why they would buy his stock at 10 times revenues ($64). Quote: "What were you thinking?"

April is going to be fascinating indeed...

Cheers.

Canuck (03/28/02; 16:27:32MT - usagold.com msg#: 72331)
End of 1Q02
Well boys and girls, that's the end of 1Q02 on this continent, I believe the J.A.Pan company has one more kick at the cat tonight.

How is this Japan thing going to end? First quarter earnings are on their way, will we see the goodwill writeoffs? Will we see 'accounting' writeoffs?

The first couple of weeks in April should be most interesting.

Thoughts?

R Powell (03/28/02; 16:23:02MT - usagold.com msg#: 72330)
Historical afterthought
After working on the Constitution, Jefferson was asked what form of government he was delivering. He is reported to have said,
"Gentlemen, I give you a Republic, if you can keep it."
When pressed as how best to keep it, he advocated a revolution with each generation. Though IMHO long overdue and greatly needed, I have serious doubts as to the feasibility of any meaningful, bloodless change. However, the removal of a U.S. president through the pressure of public opinion, without one shot fired, amazed me so much that I will never forget it.
Sorry to be offsubject.
I'm sure this will by no means be the end of GATA which still needs all the support we can offer. As many have mentioned, the simple act of physical buying is the best weapon we have.
BC BN And don't forget some silver too!
Rich


R Powell (03/28/02; 16:08:56MT - usagold.com msg#: 72329)
Trading hours/ GATA
I received a small booklet today from the New York Mercantile Exchange. It's standard information with one added insert giving additional info. The following is from this insert,
"Trading Hours
Futures and options: 8:25 A.M. to 2:25 P.M., New York time, for the open outcry session. After-hours trading is conducted via the NYMEX ACCESS electronic trading system from 4 P.M. to 8 A.M., Mondays through Thursdays. On Sunday, the electronic session begins at 7 P.M."
***************
Now we know where those price moves are coming from after the open outcry N.Y. market closes and before Sydney starts trading at 6:00 E.S.T.
Also thought I might mention the Bloomberg business television channel which lists all commodities, foreign stock markets, bonds and currency exchange prices early in the A.M. (6:00-8:00 E.S.T.) for those of us early risers.
I believe (not 100% sure) that the NYME booklet came after I visited their website and gave them my snail-mail address.
*********
The not-unexpected court ruling against further disclosure in the Howe lawsuit is regretable. To those whose efforts are involved I'd like to say "Thanks" and remember that there were years' worth of individual and coordinated events and efforts before the real outbreak of the American revolution. It was necessary for these events to occur to nuture the environment required for the seeds of liberty to flourish. All these plus some determined patriots (rebels!) resulted in the formation of the most unique form of government the world has ever witnessed. It's founding principals, so painstakingly verbalized by Jefferson, espounding individual liberty were not only unheard of at the time but, by all the accepted rational thinking of that era, unthinkable and untenuable. Unfortunately, basing the strength, power and foundation of government on the collective decisions of the "common" man is still in doubt.
The theft of our honest money is perhaps one of our most formidable enemies.
Thanks for fighting the good fight!
Rich


Strad Master (03/28/02; 16:05:25MT - usagold.com msg#: 72328)
Town Crier
Middle East
Your recent post quoting from news about the Palestinian/Israeli situation prompts me to pose a couple of questions that seem obvious. First, I quote from your post:

"The latest aerial survey by Israel's Peace Now movement found that 34 new Jewish settlements had been built on Palestinian land in the West Bank since Sharon took office 13 months ago. The settlements are a constant goad to Palestinians, who see their future state being swallowed up, and every new one built makes it more difficult for any Israeli government to dismantle them."

Question: How is it that that Israel can manage to live with 1.5 million Musilim Arabs within its borders but the Palestinians "see their future state being swallowed up" by a tiny handful of Jewish settlers. Hitler wanted Europe to be 'Judenrein' too, and murdered 6 million in order to try and acheive that. Clearly, the Palestinians have exacty the same desire.

Quote #2 from your post:
Many Israelis agree. Recently, in the daily Ha'aretz, Israel's former attorney general, Michael Ben-Yair, warned that continued occupation means continued war.

Question: (Taken from a brilliant weries of questions posed by Victor Davis Hanson in National Review a few days ago.)

If the West Bank is the linchpin of the current Middle East crisis, what were wars #1, #2, and #3 there about, when it was entirely in Arab hands?

Despite all their empty rhetoric to the contrary, the Palestinians, (led by terrorists like Arafat) and by extension the entire Musilm Arab world, have never demonstrated any real desire for peace. Their stated sole goal is the annihilation of Israel - the only democracy in the region.

da2g (03/28/02; 16:04:17MT - usagold.com msg#: 72327)
Chris Powell: Lawsuit
An unfortunate but not unexpected conclusion. My hat is off to Reg, particularly for his cogent arguement, and for having the fortitude to pursue his convictions. Win or lose, I think that he conducted himself graciously and admirably, and in a manner not inconsistent with the ideals that forged this Republic. If only more of us could claim the same.

In the end, I suppose the final defense in the matter is to continue to take physical off of the market and let the chips fall where they may.

Canuck (03/28/02; 15:52:27MT - usagold.com msg#: 72326)
@ Black Blade
I've been watching your water posting for a while now, good job! I had a bad feeling half a year or so ago when I heard that Bush and Chretian were talking water imports/exports.

Quick question, what's the best way to store water and how long will it keep?

TIA,

Canuck

The CoinGuy (03/28/02; 15:29:33MT - usagold.com msg#: 72325)
CDN Newsletter March 22, 2002
Thought I'd post a few short comments from the "Market in Depth". The Coin Dealer Newsletter(Greysheet), for the most part just covers the numismatic market. I know some on the board have interest in this sector as do I, but for everyone, it pays to keep abreast of all sectors in the precious metals arena.

The dealers I'm talking to are getting a few coins in here and there, but for the most part inventories seem spotty. Most inventories I've looked at, or dealers I've had conversations with, still have quite a few common date gold coins around, but at times even these inventory levels seem low.

A dealer friend of mine had to retrieve the largest part of his last order of $20 Double Eagle from Europe. Rarer coins are in strong hands, and don't look to be loosed anytime soon. I own a few, and subsequently have tightened my grip. In the past, I've purchased sectors in this market that were unfavorbable at the time, and then sat on my hands. Same strategy now..

All sectors seem to be benefitting, and I will just enjoy what I have collected thus far, and as of late, I have slowed down in this area, and have moved concentrated efforts to the bullion arena(silver bullion too).

Enough of my babbling, here are the comments:

From the Market in Depth:

"Exciting and frustrating" is how one dealer summed up the current rare coin market. The current demand being experienced in today's market for coins that are premium quality for the grade, have super eye appeal, have outstanding luster or exhibit incredible original and attractive color is unbelievable. These coins are simply bringing astonishing prices at public auction. Coins of this Caliber are also bringing super prices on the bourse in dealer-to-dealer transactions. Yet, dealers spend a lot of time viewing auction lots and then spend an equally long period of time during the auction sessions hoping to buy quality coins that their customers are demanding. Unfortunately all to often after their highest bid is reached, they still see that there may be six or seven or more dealer's hands still in the air. To their dismay, auctions have become extremely competitive.

I don't want to break any copyright laws, so I'll stop there, but will add the rest of article mentions it's not just a couple of collector/investors pushing the market to the upside, but a large number of folks looking to get into the metals. Some concerns noted were fear of the volatility in the stock market, low interest rates, and the Geo-Political landscape.

For the Silver Dollar Lovers:

"Dealers are in dire need of those silver cartwheels and are raising the ante in hopes of securing some". I felt was worth noting...


The CoinGuy

Golden Bear (03/28/02; 15:14:20MT - usagold.com msg#: 72324)
miner49er (msg#: 72289) Pizz @ 72196
Greetings miner49er,

you are wisely correct re:

"Specifically this one line caught my attention. Maybe I'm reading too much into things, but does anyone else see this as potentially verging down the path of Whereweveallbeenbefore?

"To further minimise the need to move the dinar, he said trade surplus or deficit can be credited or debited against future imports or exports." "

This last statement implies that one nation may build IOU's against another for future payment. There is no insurance against defaulting payment, and therefore this aspect of Mahathir's plan is inadequate.

Many such schemes/scams in the past have been perpetrated and failed, and your intuition on this new scheme guards you well...

Cheers.

HOOSIER GOLDBUG (03/28/02; 15:13:39MT - usagold.com msg#: 72323)
Greetings!
Thanks for all the submitted posts this week by all you outstanding goldbugs! And, welcome back ARISTOTLE!

TownCrier (03/28/02; 15:04:00MT - usagold.com msg#: 72321)
U.S. currency slowly losing its international grip?
http://www.financialexpress.com/fe_full_story.php?content_id=5582
This has been in the works for a while, but this article was the first with content worth the space here.
---
HEADLINE: Japan, China Sign $3-Bn Yen-yuan Swap Deal To Avert Future Crises

Tokyo, March 28: -- ...The Japan-China scheme, however, will be primarily symbolic because neither Japan nor China are likely to face liquidity or balance of payment crises in short term.

The scheme, worth $3 billion, is the sixth such pact under the Chiang Mai Initiative (CMI), which aims to forge closer monetary ties by creating a network of central bank currency swaps among the 10-strong Association of South East Asian Nations plus Japan, China and South Korea (Asean+3).

Japan and China are the world's two biggest holders of external reserves. Japan's foreign reserves, the world's biggest, stood at $403.5 billion at the end of February, while China's has more than $200 billion in foreign reserves.

...Japanese officials consider China's participation in the CMI important for promoting regional cooperation after Beijing relaxed its opposition to a Japanese call in 1997 for an Asian Monetary Fund, an idea fiercely opposed by the United States.

----(click URL for full article)----

Progress on something toward which the U.S. has been "fiercely opposed"?? Do you think for a minute that this could possibly bode well for the dollar? Not.

R.

The CoinGuy (03/28/02; 14:52:06MT - usagold.com msg#: 72320)
Gold Interview with Market Strategist Dan Ascani
http://www.aegeancapital.com/freeservices/archives1/Guests/Ascani/pg1.htm
Ike Iossif interviewed Dan Ascani for this piece on Wednesday. Short interview that needs Windows Media Player to listen(click speaker at top)...Japan/Oil/War with Iraq/REIT's also mentioned.

Good to hear from you Aristotle...

The CoinGuy

Black Blade (03/28/02; 14:51:54MT - usagold.com msg#: 72319)
Fearful Japanese push gold to seven-week high
http://www.theage.com.au/articles/2002/03/28/1017206137216.html

Snippit:

The Gold Index surged almost 4 per cent yesterday after the price of bullion broke through $US300 an ounce for the first time in seven weeks. Market observers said Japanese investors had been actively buying gold ahead of April 1 when the government's guarantee on bank deposits above ¥10 million is due to be lifted.

"People are scared," said the head of institutional sales at JB Were, Basil McIlhagga. "If you have more than that (¥10 million) and the bank goes under it is only the first ¥10 million that will be protected. "There has been a huge run-on ...putting money in gold, getting more accounts, putting money in foreign bonds."



Black Blade: Wouldn't you know it. I just saw another pro-gold report on CNBC. A papadigm shift? Maybe. The report stated that there is no exploration activity to replace reserves and that this will result in higher Gold prices over at least the next couple of years. There will be no meaningful exploration activity until Gold prices surpass the $350/oz. Mark (actually $380 or better is more realistic). Even then, companies are not likely to explore for more reserves for a few years until prices are solidly higher and remain there for a time.


Clint H (03/28/02; 14:49:54MT - usagold.com msg#: 72318)
Aristotle
Aristotle msg#: 72311)
<<A thousand times "Sorry!" to all my friends>>

We are just glad you are back!!!!!


Black Blade (03/28/02; 14:30:04MT - usagold.com msg#: 72317)
East scrapes for water as drought drags on
http://www.usatoday.com/weather/news/2002/2002-02-06-easterndrought.htm

Snippit:

From Georgia to Maine, eastern states are worried about a rare winter drought that has dried up reservoirs and forced conservation in a season when water is usually plentiful. Other parts of the country are also in trouble. Wyoming, Montana, and Idaho are experiencing severe to extreme drought. So are parts of Oklahoma, New Mexico and West Texas. Most of the dry areas in those states are sparsely populated, but the drought in the densely populated East is affecting tens of millions of people.


Black Blade: "Interesting Times"



R Powell (03/28/02; 14:26:57MT - usagold.com msg#: 72316)
John Hathaway on CNBC
It was mentioned in introducing him, that gold oriented funds are up 35.7% ytd and Mr. Hathaway's fund is up 46% ytd and 23.9% over the last three years. With the last year's advance in precious metal mining stocks, they must now be overvalued or gold and silver are now undervalued. I don't expect many to disagree that it's the latter.
John Hathaway stated that, while POG isn't up sharply, it is more important that there has been no new low confirming a three year uptrend which he says is just the beginning of a 5 to 10 year bull market. When asked if POG could repeat it's highs of 1980, John suggested that a decline in overvalued stock prices and a decline in the relative strength of the dollar might raise POG to heights that would surprise most people. He did not predict (wisely IMHO) any specific number.
The media exposure our market is attracting may bring more investment dollars into both the paper and physical sectors of gold and silver. Whether from well researched thoughtful investors, trend followers (momentum I believe they call it) or Joe and Jill 6-pak watching bubblevision doesn't matter as far as its effect goes. This money will enter on the long side.
The people's stock market television channel has also started displaying POG in the early morning and occasionally even charts and comments during prime time.
The times they are a-changin.
BC BN Buy some silver too!
Rich


Rock (03/28/02; 14:25:50MT - usagold.com msg#: 72315)
Gold up 66% for the year!
CNBC couldn't surpress the facts about gold any longer. Throught out the day gold was mentioned as the best preforming sector. Music to my ears! A gentleman named Hathaway a gold invester interviewed on CNBC today said that gold has been in a up trend for three years since August of 1999 when it made its bottom.

When asked how high can it go Hathaway answered that our stock market is still overvalued and if the value of the dollar fell gold could really go high. He mentioned as Blackblade and others have said here about gold being an insurance policy for your portfolio. He recommended 5% invested in gold but thats too light for my comfort, I'm 80% PM's so I'm enjoying the 66% gain this year.



Black Blade (03/28/02; 14:20:08MT - usagold.com msg#: 72314)
NYC mayor declares drought emergency
http://www.usatoday.com/weather/news/2002/2002-03-27-nyc-droughtemerg.htm

Snippit:

NEW YORK (AP) — Mayor Michael Bloomberg on Tuesday declared a "Stage One" drought emergency, implementing restrictions on water usage by residents and businesses around the city.

"Our city is in the midst of the worst drought it has experienced in a decade," said Bloomberg, speaking on a cloudy day at a water supply facility in the Bronx.

"The likelihood, even if we have a lot of rain, is that we will still have our reservoirs at a dangerously low level. We urge everybody to please conserve as much as you possibly can," Bloomberg said.


Black Blade: The whole East Coast is in trouble this year. The Rocky Mountain, Midwest, and Southwest are also likely to experience "Dust Bowl" conditions not seen since the Great Depression. The implications for the US economy is obvious. As always, get out of debt, get Gold and Silver portfolio insurance, get enough cash on hand for several months expenses, and definitely get a nonperishable food (and water) and basic goods storage program started. At least be prepared "just in case".


Black Blade (03/28/02; 14:06:08MT - usagold.com msg#: 72313)
US Drought Monitor
http://enso.unl.edu/monitor/monitor.html

The US drought map and drought analysts region by region. Also has interactive maps. See what the risk is in your area (US residents).

I had posted an assessment of worldwide fresh water needs and that future conflicts could be over the critical commodity - especially with a growing population and increased water needs for energy, food, drinking, etc. It has always been taken for granted in the past, it just might be daily front page news in the near future.

- Black Blade

Black Blade (03/28/02; 13:50:28MT - usagold.com msg#: 72312)
Drought grips much of USA, stirs water supply fears
http://www.usatoday.com/weather/news/2002/2002-03-02-usa-drought.htm

Snippit:

Latest drought outlook

Drought has engulfed nearly a third of the United States, threatening to confront some places this summer with what experts say could be their worst water shortages in years.

"This is a sleeping giant," says climatologist Mark Svoboda, at the National Drought Mitigation Center in Lincoln, Neb. "The impact is still to come."

Already, New York and Baltimore are pumping water from temporary supplies normally avoided for their potentially less desirable color or taste. Thousands of shallow wells in New Hampshire and Georgia have run dry. In Kansas, some ranchers are hauling in water or selling off cattle.

Yet a much stiffer test will come this summer when farmers water crops, homeowners douse lawns and gardens, and high temperatures evaporate more water faster. Without a rainy spring, some places in the East may face a summer of water problems that rival record droughts of the 1960s, according to Harry Lins, a drought specialist at the U.S. Geological Survey.


Black Blade: We have touched on water supply in the past and why water should be a part of ones food storage program. It appears that water will be a major concern this summer. The impact on food crops is obvious and so a review and inventory of ones nonperishable food supply is in order.

Of course as people compete for water supplies we should remember that there are also severe restrictions on human water use during droughts for environmental reasons. Remember that the Klamath Lakes were forcibly set off limits to farmers in Washington during last years drought in order to save the carp. Even the National Forest Service refused to let fire fighters have their helicopters dip into Washington rivers to fight a major forest fire last because it could potentially scoop up salmon – several fire fighters died in the raging fire as a result. Now think of this drought situation nationwide. This newest drought will affect the nations farmers and ranchers resulting in less food supply and higher food prices (in spite of the wildest of BLS hedonic deflators).

River levels are at there lowest since the 1920's Dust Bowl (how appropriate – just prior to the Great Depression). Just imagine how this will affect the economy as well. The result is an increased reliance on NG-fired power generation as hydropower will be severely restricted to keep water levels high enough for wildlife needs. The NG supply has been withdrawn at over double last years rate – and now with 69 nuclear power plants likely to be shutdown for possible boric acid corrosion concerns. Higher water, food and energy costs are a given this year. But don't worry, it's not inflationary as it is not in the "core rate".


Aristotle (03/28/02; 13:34:04MT - usagold.com msg#: 72311)
A thousand times "Sorry!" to all my friends
No doubt some of you will remember, perhaps angrily, that I promised to deliver a post several months ago and then was a big fat No-Show without so much as a word of explanation or begging of pardon. Well, some conversations were had, plans changed, and... it was easier that way!!! Pooof!

But lo' and behold, having kept my finger all this time on the pulse of things (insofar as I can,) I see that someone has said something today that conjures up the relevance of my long-abandoned post. But even more importantly, I deem the conditions of the Gold market have matured to the point where it's probably appropriate that I should now share some of these particular thoughts and tales without too much fear of being waved off. You'll please understand I can't just drop everything to do this, though, but all in good time I assure you!! (With a little luck you'll forgive my delay and quite possibly hear something along the way that may be of use to you. I hope!!) Stay tuned.

Gold. Get you some. ---Aristotle

Waverider (03/28/02; 13:22:42MT - usagold.com msg#: 72310)
Black Blade
Unfortunately I have to agree with you. Reminds me of Stephen Vinzinczey's "An Innocent Millionaire" - great novel and a virulent indictment of the legal profession. Cheers, Waverider

Black Blade (03/28/02; 12:53:28MT - usagold.com msg#: 72309)
Reg Howe Lawsuit

Come now, you really didn't expect any other outcome did you? The courts have their marching orders and the judge knows who his masters are. He will not jeopardize his position and opportunity for advancement by taking any course that is contrary to the wishes of the ruling class. The outcome of this case was predictable and it was decided before it was even filed.

- Black Blade


Operative (03/28/02; 12:41:52MT - usagold.com msg#: 72308)
@ Chris Powell
Your efforts were honorable and courageous. You fought a good fight against great odds. In spite of this judge's ruling, you have won by introducing so many to the truth of the gold manipulation. Job well done sir!

( I will forever stop and ponder what you would have found if allowed only a limited "discovery" period. The mother of all paper trails remains hidden for now.)

TownCrier (03/28/02; 12:40:13MT - usagold.com msg#: 72307)
INSIDE FOREIGN AFFAIRS -- Arab summit
http://www.usagold.com/gildedopinion/Jensen/20020328.html
International editor Holger Jensen reports on conditions surround the Arab summit.

Excerpts:

-------Yasser Arafat is not attending because of tough Israeli conditions that could have barred him from returning to his West Bank headquarters.

Israeli Prime Minister Ariel Sharon not only demanded that he call a cease-fire -- which Arafat has done before with little effect -- but said Arafat could not go unless the Bush administration backed any Israeli decision to exile the Palestinian leader if violence occurred during his absence.

[The Saudi proposal] promises "normal relations and security for Israel in exchange for full withdrawal from all occupied Arab territories, recognition of an independent Palestinian state with al-Quds al-Shareef (East Jerusalem) as its capital and the return of refugees."

Bush -- enthusiastically in favor of the proposal because it comes from an Arab ruler and offers Israel something the Arabs, collectively, have never offered before -- urged them to "seize the moment" and approve it.

But Sharon has not seized the moment. He argues that Israel cannot give up all the occupied territories without endangering its security. He has made it quite clear that he will never give up the eastern part of Israel's "eternal and undivided capital." And no Israeli leader would ever agree to a return of Palestinian refugees who would outnumber Jews and spell demographic suicide for the Jewish state.

The latest aerial survey by Israel's Peace Now movement found that 34 new Jewish settlements had been built on Palestinian land in the West Bank since Sharon took office 13 months ago. The settlements are a constant goad to Palestinians, who see their future state being swallowed up, and every new one built makes it more difficult for any Israeli government to dismantle them.

Many Israelis agree. Recently, in the daily Ha'aretz, Israel's former attorney general, Michael Ben-Yair, warned that continued occupation means continued war.

"The Six-Day War was forced upon us," he wrote, "but the war's seventh day is the product of our choice. We enthusiastically chose to become a colonial society, ignoring international treaties, expropriating land, transferring settlers from Israel to the occupied territories, engaging in theft and finding justification for all these activities.

"Passionately desiring to keep the territories, we developed two judicial systems, one -- progressively liberal -- in Israel and the other -- cruel, injurious -- in the occupied territories. In effect, we established an apartheid regime, and this oppressive regime exists to this day.

"This is the harsh reality that is causing us to lose the moral base of our existence as a free, just society and to jeopardize Israel's long-term survival."

The Palestinians can only say amen.

---- (click link for full commentary)-----

Bottom line: Mideast peace still a long row to hoe.



Chris Powell (03/28/02; 12:18:27MT - usagold.com msg#: 72306)
Gold price-fixing lawsuit dismissed
http://pacer.mad.uscourts.gov/recentopinions.html
2:10p ET Thursday, March 28, 2002

Dear Friend of GATA and Gold:

Reg Howe's lawsuit against the Bank for International
Settlements, the U.S. Treasury Department, the
Federal Reserve, and the bullion banks was dismissed
today by Judge Reginald Lindsay in U.S. District Court
in Boston. We haven't analyzed the decision yet, but with
Adobe Acrobat, you can read it on the Internet here:

http://pacer.mad.uscourts.gov/recentopinions.html

At this hour the decision is the fifth case from the top of the page, headlined, at the left, "Howe memorandum and
order."

GATA thanks and congratulates Reg for his heroic effort,
and reminds its friends that we continue to press the cause
on several fronts. It doesn't stop here. Far from it.

CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.

YGM (03/28/02; 12:16:32MT - usagold.com msg#: 72305)
Still Watching from afar........
....and thought I'd say Hello! I'm pleased to see familiar faces still gracing this great hall. Maybe the time is near
for Sir Douglas to return with his sage insight for those who miss his walks down the "Gold Trail".....

"Go GOLD, Go Physical & Go G.A.T.A."

Operative (03/28/02; 12:16:09MT - usagold.com msg#: 72304)
CNBC INterview with John Hathaway
CNBC just announced that they will have an interview with gold fund mgr John Hathaway at 3:00 Pm EST ...about 45 min from now. Heads up to all.

TownCrier (03/28/02; 12:08:23MT - usagold.com msg#: 72303)
From USAGOLD NewsWire -- Gold markets around the long weekend
http://www.news24.com/News24/Finance/Markets/0,4186,2-8-21_1162573,00.html
Excerpts from article:
-----
28/03/2002 20:15  - (SA) London -- ..."There's no question it's going to stay above $300... It's broken away from its previous range of $297-302 and now looking to make resistance at $308," said one London metals trader.

Analyst John Reade of UBS Warburg said the trigger for the rise was mainly that funds wanted higher prices at the end of the first quarter when the books are closed.

"Gold traded higher for largely technical factors - quarter-end window dressing from a long speculative community and a lack of regular sellers in the market."

"The move has, however, taken on a life of its own and gold could trade quickly higher if important resistance around the $306 an ounce level is broken," he said. European markets will be closed on Friday and Monday, either side of Easter Day.

"At this stage, the downside appears limited given the fact that the Japanese market will be open for business on Friday and few will want to go home short today," one trader said, noting that the Japanese had been major buyers in recent months.
-------- (click link for full article)----

Call today. Centennial is open for business so give yourself peace of mind ahead of the holiday weekend by getting your order in the pipeline.

R.

RobotGuy (03/28/02; 11:30:28MT - usagold.com msg#: 72302)
I remember a promise by Thom Calandra
http://cbs.marketwatch.com/news/story.asp?guid=%7BFBBC334F%2DE76B%2D4E3F%2D8AF5%2DB9B33B3319F6%7D&siteid=mktw
For those of you who don't know who he is, he frequently touts PMs on one of the better known market tracking web sites.

Thom said at one time in the not too distant past, that if POG were to close above $300 for three days consecutively he would dye his hair gold :)

I haven't forgotten Thom! I'm looking forward to seeing that one!!


RobotGuy.



Gandalf the White (03/28/02; 10:57:57MT - usagold.com msg#: 72301)
Operative (03/28/02; 10:47:58MT - usagold.com msg#: 72300)
Danke!
<;-)



Operative (03/28/02; 10:47:58MT - usagold.com msg#: 72300)
@ Gandalf
http://informer2.comdirect.de/de/detail/_pages/charts/main.html?sSymbol=GLD.FX1&sTimeframe=iD&useSettings=0&showSettings=&sid=&hiddenTimeFrame=1&sOrdType=price&sScale=linear&sMarket=GLD.FX1&iType=1&sAv1=38&sAvfree1=&sAv2=200&sAv2free2=&sAv2count=1&iI
Another source of 24 hour gold qoutes/chart

Sierra Madre (03/28/02; 10:46:26MT - usagold.com msg#: 72299)
Malaysia's Dr. Mahathir

This Dr. Mahathir is really something!

When the Asian crisis exploded - back in '98 I think it was - he defied the IMF and was lambasted for doing so.

Today, he is the ONLY important public figure that is doing any THINKING and talking sense. This is a remarkable man!

He deserves support - if he cares to have any - and I for one, am writing to the Malaysian ambassador to express my views: Dr. Mahathir is on the right track and should press forward boldly with his plan.

+++++

Sector: your idea of purchasing futures as an insurance.

We saw what that insurance amounted to on the TOCOM (Tokyo Commodities Exchange) when platinum went way up.

Black Blade saw it coming clearly: the TOCOM was not able to deliver the platinum, as they will not be able to deliver the gold in the not-too-distant-future. They will first, impose excessively high deposit requirements on purchases of futures contracts - say, twice the value of the gold futures contract. And next, when you want to take delivery, they will not be ABLE to honor the contract, (no gold!) and you'll have to settle for fiat.

There's no insurance in the coming chaos, except physical ownership.

Consult USAGOLD today.

Sierra



Gandalf the White (03/28/02; 10:25:42MT - usagold.com msg#: 72298)
Please NOTE : The INO board is FROZEN and the POG is NOT 301.9!!!
Alternative sources are required, such as Crystal Balls.
<;-)
(try $304+ !)

uponroof (03/28/02; 10:21:50MT - usagold.com msg#: 72297)
Japanese Deposit Insurance Cap Updates
Thursday, March 28, 2002
DEPOSIT INSURANCE CAP: Reimbursement May Take Up To A Year

TOKYO (Nikkei)--Depositors will have no chance of immediately getting their money from failed financial institutions once the government's deposit guarantee ends on April 1, because all the bank's offices and ATMs will be shut.

Customers will be able to withdraw principals of up to 10 million yen, plus interest, a couple of days after a bank failure. In many cases, depositors are expected to take their money out of the bank on the Monday morning after a failure the previous Friday evening, although it could take longer while the banks struggle to sort out depositors with more than one account.

It will take several months at least, however, and possibly up to a year for the Deposit Insurance Corp. to identify the level of damage to the bank's assets before determining refunds over 10 million yen.

It is probable that in the meantime the corporation will reimburse part of these deposits to help them avoid a credit crunch.

* * * *

Thursday, March 28, 2002
DEPOSIT INSURANCE CAP: Money Pours Into Ordinary Accounts

TOKYO (Nikkei)--An accelerated shift of bank deposits to ordinary accounts from time deposits is taking place at Japanese banks, ahead of the April removal of the blanket guarantee on deposits in case a bank fails.

The move is taking place because the current full-refund guarantee will be in place for ordinary deposits for another year.

The total balance of ordinary and other liquid deposits of individuals at five major banks has swelled by about 11 trillion yen during the year through the end of February.

A Bank of Japan survey in February showed that the balance of time deposits fell 6.4% from a year earlier, the largest dip since the central bank began collecting such data.

On the other hand, the balance of liquid deposits posted a 22.1% increase, the largest gain since October 1973.

The combined total of liquid deposits at Sumitomo Mitsui Banking Corp. (8318), UFJ Bank, Bank of Tokyo-Mitsubishi, Dai-Ichi Kangyo Bank and Fuji Bank, hit about 43 trillion yen, up 11 trillion yen from year-earlier levels.

The surge in the amount of ordinary deposits at major banks primarily stems from a decrease of about 4 trillion yen in the balance of large-lot time deposits of over 10 million yen.

Also contributing to the increase was the move by many consumers to relocate their deposits to large banks, alarmed by a series of failures among regional banks and credit unions.

Yet another reason is the mounting apprehension among consumers about investment trusts, which were believed to be a major alternative investment vehicle that would attract funds from time deposits.

A growing number of consumers have been scared away from money management funds (MMFs) or bond investment trusts since many MMFs, which held bonds issued by the failed U.S. energy giant Enron Corp., have fallen below their subscription prices.

The balance of investment trusts marked a 21.4% decline in February from a year earlier, the BOJ's survey showed.

In a bid to curb the heavy concentration of deposits in ordinary accounts, Bank of Tokyo-Mitsubishi on Wednesday decided to lower the annual interest rate on ordinary deposits to 0.001% from the current 0.02%, effective April 1.

Other major banks, including UFJ and Sumitomo Mitsui, along with the postal savings system, will likely follow suit.

These banks will trim interest rates to cope with an expected deterioration in profitability, as the Deposit Insurance Corp. will raise the premiums the banks have to pay on ordinary deposits from April.

An increase in the amount of ordinary deposits will lead to higher insurance-coverage costs. Yet it remains to be seen how soon and how much other banks will lower their interest rates on ordinary deposits.
* * * *

Thursday, March 28, 2002
DEPOSIT INSURANCE CAP: Depositors Move To Protect Funds

TOKYO (Nikkei)--Full deposit protection will end in two stages. Next week, a 10 million yen ceiling is due to be reimposed on the government insurance for time deposits. The protection of ordinary accounts will also be limited from April 2003.

After the two-stage shift is complete, depositors of any types of accounts will have to face the risk of losing all of the money above the maximum limit that they deposit into banks, credit unions and shinkin banks, if they fail.

However, the scale of damages to be suffered by depositors will be different according to the assets at financial institutions. If a failed bank is left with a small amount of assets, depositors can only expect to recover a maximum of 10 million yen.

In search of greater safety, depositors with time deposit balances of over 10 million yen are shifting their funds in excess of the protection cap to other banks.

Among others, large-lot depositors are rushing to disperse their accounts to various banks in units of 10 million yen.

In case of a bank failure, balances of several accounts held by individual depositors at a single bank's different outlets will be all added up to return up to 10 million yen in principal and interest to them.

This approach is also taken for investors in such financial instruments as money trusts with guaranteed principal -- offered by trust banks -- and bank debentures under custody of financial institutions.

These products, categorized as time deposits, will also become the target of the depositor protection cap from April.

Among other financial products, foreign-currency deposits at domestic and foreign banks, money trusts with no guaranteed principal, corporate bonds other than bank debentures and government bonds under custody of financial institutions are excluded from the government's deposit insurance scheme.

Under special provisions, however, the two types of products -- foreign-currency deposits at domestic banks and money trusts with no guaranteed principal -- are fully protected through March, but they will also become uninsured from April.
* * * *

Thursday, March 28, 2002
DEPOSIT INSURANCE CAP: Deposits To Be Offset With Debt

TOKYO (Nikkei)--Depositors will be allowed to offset their deposits with loans at a failed bank under the deposit insurance cap system from April, in which the government will protect a time deposit only up to 10 million yen plus interest at an insolvent lender.

Under the debt-offsetting plan, if a depositor has a time deposit of 30 million yen at a failed bank and also has a mortgage of 15 million yen from the same lender, he or she will be permitted to offset the two figures, generating a difference of only 15 million yen.

The gap will then be subject to the deposit insurance cap, meaning that only 10 million yen of the 15 million yen, plus interest, will be protected.

From April 2003, when the deposit cap system will be expanded to cover ordinary deposits at a failed bank, depositors will be able to include their ordinary deposits in this offsetting formula.

To apply for the offset system, depositors will be required to bring a necessary set of documents plus their deposit passbooks to a given, failed bank.

In case they have multiple deposit accounts at a failed bank, they will be able to choose which of them to offset their debt under the payoff system.

(The Nihon Keizai Shimbun Thursday morning edition)



Pizz (03/28/02; 09:53:33MT - usagold.com msg#: 72296)
Miner49er
Amazing how our minds work from different ponts of view. Your immediate attention was drawn to net international settlements with the dinar (gold).

Seems like a great way to drain our gold reserves. Puts a whole new light on the tariffs and the starting of trade wars. We either rebuild our manufacturing base or lose our gold. It even becomes more accute when the dollar crashes. More expensive imports and forced international settlement in gold dinars????

Now, the first thing to catch my attention was the following:

"The risk of speculation will be reduced to almost nothing and world trade can actually expand because the cost of business will be much reduced as the need to hedge would practically disappear,"

I seem to recall that international financial hedging can also be defined as financial derivitives. I also seem to recall that most international banks have made major dollars in this market. Take this market away along with the drop in investment banking, and JPM et al's profits drop off the cliff.

The gold Cabal? With Islam, China, Russia, and India all lining up for free trade in gold and gold backed international settlements, the end result should be very similar to the Denver Broncos playing a pee wee leage team in the super bowl.

More thoughts later


Pizz

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