You've toiled diligently and intelligently all season long
and now it's harvest time for your summer crop.
ARCHIVED DISCUSSION FROM 10/29/2001
All times are U.S. Mountain Time
(Yesterday's Discussion.)
Black Blade
(10/29/01; 21:37:01MT - usagold.com msg#: 64351)
US special unit 'stands by to steal atomic warheads'
http://portal.telegraph.co.uk/news/main.jhtml?xml=/news/2001/10/29/war129.xml&sSheet=/news/2001/10/29/ixhome.html
Snippit:
AN elite American military unit is preparing for possible incursion into Pakistan in order to steal its nuclear weapons arsenal, it is reported today. The special forces unit is training with Israel's most trusted anti-terrorist unit, and would be called into action in the event that Gen Pervaiz Musharraf lost power in Pakistan, the New Yorker magazine said. The CIA believes that Pakistani army officers sympathetic to the Taliban could pose a threat to Gen Musharraf, and that some of the country's estimated 24 nuclear warheads could be stolen by renegades within Pakistan's intelligence service, the ISI.
Pakistan is thought to have a number of intermediate-range missiles to carry its warheads as well as using F-16 fighter-bombers. There are a number of possible targets for the use of these weapons by renegades sympathetic to the Islamic extremists in Afghanistan. These include India, itself a nuclear power, or the four American aircraft carriers and British vessels currently cruising off Pakistan's coastline as bases for air and commando attacks on the Taliban and al-Qa'eda.
Black Blade: Nuclear weapons in the hands of the Taliban when Gen. Musharraf is overthrown would create a whole new ball game. Maybe the Northern Alliance could be a target as well. "Interesting Times"
Elwood
(10/29/01; 21:27:59MT - usagold.com msg#: 64350)
Question for Trail Guide
Sir, would you care to speculate on the level of tax required on gold transactions to keep them above ground? Would this be an international tax, or would cross-border transactions be exempt?
Regards,
Elwood
Black Blade
(10/29/01; 21:21:46MT - usagold.com msg#: 64349)
How Secure is Pakistan's Nuclear Arsenal?
I heard an interview on NPR today with a nuclear physicist. He stated that several Pakistani physics students who attended US universities returned home and were instrumental in the development of Pakistan's nuclear arsenal. He also stated that many were supporters of Osama Bin Laden. If true, then a problem could exist once the more radical elements take control of Pakistan. Suicidal terrorists hijacking aircraft would be the least of our problems. "Interesting Times"
- Black Blade
Black Blade
(10/29/01; 21:14:40MT - usagold.com msg#: 64348)
"Does U.S. need to strengthen energy security?"
http://199.97.97.163/IMDS%PMANAT0%read%/home/content/users/imds/feeds/bellsuper/2001/10/29/DTNS/0000-2883-KEYWORD.Missing
Energy Independence Is Crucial for Jobs, Security
Snippit:
The Sept. 11 attacks on the World Trade Center and the Pentagon have made the need for a comprehensive energy policy more urgent. We have to make sure America remains as oil independent as possible while it protects current jobs, replaces lost jobs and creates new jobs. The Teamsters' Union supports the House-approved version of the energy bill that included petroleum exploration in the Arctic National Wildlife Refuge (ANWR). Should the Senate pass similar legislation, it will create jobs and benefit working families.
The threat of terrorism means that we have to take every possible step to keep this country independent and strong. The more independence we have from foreign sources of energy, and the stronger our economy is, the more likely it is that we will continue to thrive no matter what terrorist throw at us.
Black Blade: Fits in with yesterday's post on Energy and National Security" - msg#: 64279. The current war on terrorism has much to do with hydrocarbons. Energy is critical to the survival of the Global Economy. Whoever can keep and control the World's hydrocarbon supply - owns the World.
auspec
(10/29/01; 19:53:41MT - usagold.com msg#: 64347)
Crashmaker
"The Federal Reserve affects the entire economy, but acts outside the public's scrutiny, and subject to no control by the voters. Why do people tolerate this? For two reasons: one valid, the other not. First, many people think Congress and the President can't be trusted with power over money. They're right. NO POLITICIAN CAN BE TRUSTED WITH POWER OVER MONEY. That's why the Founding Fathers designed the Constitution to deny politicians that power. Second, some people think that a politically independent and expert agency can exercise monetary power w/o danger to the public. They're wrong. Where money and banking are concerned, politically independent and expert merely mean that power's been centralized in the hands of private bankers and their political shills. But no private bankers and subservient politicians can be trusted with power over money."
"The Federal Reserve was established to do what the free market won't: to set monetary policies that specifically benefit financiers, bankers, Fed officials, and their cronies in the worlds of business and politics. Financiers want monetary policies that maintain the value of their assets. Bankers want monetary policies that expand their opportunities to lend. Politicians want monetary policies that support open-handed governmental spending to buy votes. And officials of the Fed have personal interests to advance. So, far from being politically independent, the Federal Reserve's thoroughly politicized- but for the benefit of a small minority. Coupling bank and state interlocks the interests of financiers and politicians, at everyone else's peril and expense. And the real expertise the Fed displays is in making the scam pay off for those special interests. It's very simple: control over money always translares directly over control over wealth and power. When the free market produces money, the people govern themselves both economically and politically. When politicians and bankers produce money, they redistribute other people's wealth and buy political power. Such a country is a corporate state."
".....the history of the gold standard during the latter half of the nineteenth century........ That's the history of a phony gold standard harnassed to fractional-reserve banking- a scheme designed to use money, not solely as a medium of exchange, but also and especially as a means to redistribute wealth. It can't possibly be the history of the constitutional system of money and banking, because the constitutional system hasn't been put into practice since the Civil War."
"The constitutional system requires the govt to use SOUND money as its only official money."
"Sound money is money fully integrated into the free market. Its quantity depends on its cost of production relative to other goods, and on the amount of their wealth people want to hold as cash. Therefore, sound money's commodity money. Being a physical thing requiring real resources to produce, commodity money's safe from political manipulation of its purchasing power." END
Comment: Enjoying this book, wish I could cut and paste excerpts instead of typing them out.
Say it ain't so Al.
R Powell
(10/29/01; 19:52:02MT - usagold.com msg#: 64346)
Netking/USAGold
Netking, thanks for asking about any physical silver shortage as there have been umpteen reports (rumors?) concerning this usually at the posters' local dealer's level.
USAGold, thanks in advance for anything you can find out. You are, of course, the logical candidate for us to ask. There are many of us who believe that the silver market may not react to the supply/demand and ongoing deficit until there is literally not enough to fill orders in the short term. The Comex price seems oblivious to any and all market fundamentals. Or, perhaps we are all wrong and there is some huge supply somewhere?
Thanks for looking into this.
Rich
Black Blade
(10/29/01; 19:41:48MT - usagold.com msg#: 64345)
Asian Markets Crack
http://quote.yahoo.com/m2?u
Asian markets are falling apart tonight. Taiwan crumbles below 4000.
USAGOLD
(10/29/01; 19:13:46MT - usagold.com msg#: 64344)
Working. . . . .
Netking. . . First of all, thanks for your on-going contribution here at the forum. I've heard rumblings but would like to offer something reliable. I will try to get an answer for you tomorrow on the national level, i.e., the following:
"USAGOLD/Centennial Precious Metals: Have you noticed much in your geographical location as a Company (or within the industry) of a physical Ag squeeze in the early stages?"
Netking
(10/29/01; 18:47:37MT - usagold.com msg#: 64343)
Trend Analysis
Continuing on from a post or two here over recent days on cycles & trend analysis this post from a gold bug named 'rabbit' may be of interest - Netking;
". . . one, who has studied trend analysis must begin to realize that since the Fall of 1999 the trend of gold has been UP! A price of about $252 in the Fall of 1999,just before the Washington Agreement, was the 20 year low (almost) since early 1980. The next low was in about April 2001 at about $255, and now the low of $274 or so last week! Higher lows will lead to higher highs as we now move to wave 3 of wave III of this cycle. Make no mistake about it Goldbuggerer ( and others of his ilk ). The commercials are switching from short to long positions and the fundamentals are moving inexorably in golds favor! It is not easy to estimate the exact timing of highs in this cycle ,and I have erred in thinking we would reach $375 by mid October. . . I am not concerened over exact timing. The general direction (per the cycle wave and timing is UP, and will continue to be so. For your own financial health. . . SHORTS, get long NOW or be impoverished!!!"(end)
auspec
(10/29/01; 18:35:27MT - usagold.com msg#: 64342)
TVX{not}
Canuck and uponroof
This message is explicitly NOT about TVX or any other gold stock because that is strictly frowned upon by the 'house'. I will, therefore, not post the comment that TVX has largely solved their debt problems and is looking most 'interesting' now.
I do NOT own TVX {yet}.
NIA and NAP {not a post}
Black Blade
(10/29/01; 18:21:20MT - usagold.com msg#: 64341)
Bush Expected to Order Oil Reserve
http://dailynews.yahoo.com/h/ap/20011029/bs/oil_reserve_1.html
Snippit:
WASHINGTON (AP) - President Bush is expected, perhaps within days, to direct that an additional 70 million barrels of oil be put into the government's emergency reserve over the next several years, according to administration and private sources. The additional oil would be acquired at a rate of about 100,000 barrels a day and for the first time would bring the government's Strategic Petroleum Reserve to its full capacity, said the sources, who spoke on condition of anonymity. Private economists viewed the move as additional insurance against future supply disruptions. At the same time, they said, it will help to contain the recent downward spiral in world oil prices by taking 100,000 barrels a day off the market.
Black Blade: This is a "No-Brainer." While prices are lower and before the war spreads throughout the MED region, it isn't a bad idea to stock up for insurance. BTW, the AG says that we could expect more terrorist acts this coming week. "Interesting Times"
uponroof
(10/29/01; 17:23:15MT - usagold.com msg#: 64340)
Cannuck TVX and Juniors
Doesn't TVX has a reverse split coming up? What do you think? What's happening now? Anything coming up? Results etc?
Whole lotta other juniors/explorers that are also way underpriced right now. My favorite junior/intermediate is KRY which has 12 mil ozs. of gold in the balance the next few weeks. Venezuelan gummint to award Las Cristinas in early Nov. KRY has a very good chance of aquiring. Last time deal fell through specs drove shares up to 8+US. Closed today at 1.55. Good chance at joining TSE300 soon which means 2.7 mil shares gobbled up by funds.
Keep an eye on explorers and the Canadian diamond industry also. ACA.TO, V.RDM and CALVF (to mention a few) are into that (along with gold) with a shot at some really major bagging should kimberlite pipes give way to 'a girl's best friend'. They're all buying hundreds of thousands of acres of ice in the 'Diamond Corridor of Hope" where Diamet started the rush 10 plus years ago. Just a matter of time before someone hits again.
These are plays that could pop before POG moves, which is what I'm hoping, so that I can buy some more physical.
Good luck all!
**************
BR549- right you are "too big to fail" is not a benign situation. It reeks of manipulative influence and blackmail. Does JPMC have the gummint by the short hairs here? Would the gummint let them fail before giving them inside info to survive? I think so.
site steward
(10/29/01; 17:06:08MT - usagold.com msg#: 64339)
"Give 'em hell, Number Two."
http://www.eubusiness.com/cgi-bin/item.cgi?id=61866&d=101&h=240&f=56&dateformat=%25o%2520%25B%2520%25Y
MUNICH, Germany. Oct 29 (AFP) - The deputy president of the Bundesbank, Juergen Stark, told euro-zone governments on Monday to get their finances in order and stop telling the European Central Bank to cut key rates. "Blurring the boundaries of responsibility is not very helpful and contravenes the Maastricht Treaty and its ban on anyone seeking to influence monetary policy."
+
Indeed, monetary policy in Europe was not designed to fine-tune the economy.
+
"Politicians shouldn't overestimate the capabilities of monetary policy," he said. "Monetary policy cannot smooth out what has been bent by national fiscal, social and labour market policy."
---------
INDEED. And through this, the enduring need for personal gold ownership (for citizens within ANY nation) is illuminated in a more proper light.
R.
R Powell
(10/29/01; 17:06:08MT - usagold.com msg#: 64338)
BR549
Those nasty derivatives
You have probably read most of James Puplava's essays but on the chance you missed it, pages 8-14 of Part 9 are titled "The Derivative Time Bomb". I thought enough of it to print out the whole Part 9 (prints at 31 pages) and, after talking of derivatives, a good deal of the rest of this (Part 9) discusses two metals often mentioned here.
I think Puplava's work may now be included in the Guilded Opinion sector here but I'm not sure as I have it printed and have not needed to search for it. If not, it can be found at financialsense.com
It may be worth remembering that having derivative liens on vastly more (quantity) of a commodity than is in actuality available in physical form is an ordinary occurance in most all commodity markets. This is not unusual as almost all future and option positions are simple paper bets to be settled in whatever fiat is currently in fashion. This applies to Comex and other exchanges. The sale of leased metals or national holdings and other backroom (OTC) deals are another matter altogether. I mention this as many seem to have trouble with the idea of buying that which one will never receive or selling that which one does not own or, even more bizarre, buying and/or selling options on these afore- mentioned transactions.
I realise that there are all kinds of other unholy dealings with gold and to some extent silver which are extraneous to the normal bizarre futures' markets functioning. I'm simply stating that I view these as two separate issues although I know some condemn them as one even though no commodity market could function smoothly without the liquidity of speculation.
Thanks for the reports from your "homework". Keep them coming!
Rich
BR549
(10/29/01; 16:47:51MT - usagold.com msg#: 64337)
Banks & LTCM-a license to steal
@uponroof--
Two great posts in a row!
The LTCM boys were leveraged and gambled their money at zero risk (the big Fed casino had their backs).
RE: Banks making money--how about a credit card annualized rate of return at 18%++ with a nominal cost of capital at below 4%. There are many, many businesses that wish they could get half of that ROR/ROI.
Regards,
BR549
site steward
(10/29/01; 16:47:24MT - usagold.com msg#: 64336)
Psychology 101 coming in 60 days.
http://www.eubusiness.com/cgi-bin/item.cgi?id=61857&d=101&h=240&f=56&dateformat=%25o%2520%25B%2520%25Y
Excerpts of predictions by economists and psychologists on introduction of euro notes and coins:
LONDON, Oct 29 (AFP) - The much-maligned euro will get a shot of popularity with the launch of banknotes and coins on January 1, analysts predict. "Public opinion has never been really hot towards the euro. People are not very interested in it at the moment," .....at first, "a lot of people will find their lives disrupted by the launch of notes and coins, and they will say nobody ever told them it was coming. They will grumble, but then they will get used to it. ... Over the summer vacation, the northern Europeans will discover something new and then they will just accept it. The public will for the first time have a visible symbol that they are Europeans."
"If there is any change in public sentiment, I think it will be for an improvement."
--------
How well will the dollar stand up under improved euro sentiment?
The clock is ticking down...
R.
Canuck
(10/29/01; 16:35:28MT - usagold.com msg#: 64335)
Is TVX the Canadian version of Durban?
Comparision of DROOY (Nasdaq)............. TVX (TSE300)
All time high..... $52US (1980)..............$95CDN (1987)
All time low.....$0.77 (July 2001)...........$0.65 (Today)
'Bagger' (H/L).......67........................146
1980 Spike(H/L).....50/5........................N/A
'Bagger'.............10.........................N/A
1983 Spike(H/L).....50/10.......................N/A
'Bagger'..............5.........................N/A
1987/88 Spike(H/L)...15/5......................90/15
'Bagger'..............3..........................6
1993-96 Spike(H/L)....14/2.....................75/15
'Bagger'...............7.........................5
1998 Spike (H/L)......4/2.......................24/9
'Bagger'...............2.........................2.6
Sept. '99 (H/L)....2.70/1.35....................12/5
'Bagger'...............2........................2.4
May '01 (H/L)......1.50/1.00..................1.70/0.90
'Bagger'..............1.5.......................1.9
Sept. '01 (H/L)....1.35/0.90..................0.98/0.77
'Bagger'.............1.5.........................1.3
Now would a 67 or 146 'Bagger' be nice? The TA looks great, are they comparable? How are the fundamentals?
Any TVX fans out there?
Comments
uponroof
(10/29/01; 14:16:12MT - usagold.com msg#: 64334)
Investment Banks Having a Dreadful Year
http://www.economist.com/finance/displaystory.cfm?story_id=832967
Oct 25th 2001 | LONDON AND NEW YORK
From The Economist print edition
Investment banks are having a dreadful year, with thousands of jobs cut. The future looks no better
WAS it only last February that Jack DiMaio's threat to quit prompted his employer, CSFB, to offer the bond trader a 50% pay rise, to about $45m over three years—guaranteed no matter how he performed? These days, investment banks are desperate for their workers to quit. With as much hope as realism, CSFB is trying to scrap the guaranteed pay packages it awarded to Mr DiMaio and many others, and is axing 2,000 bankers. On October 22nd, Merrill Lynch invited most of its 65,900 staff (though not its 15,000 brokers in America) to apply for voluntary redundancy, in order to help it cut about one-sixth of its workforce.
Investment banking is now in its worst recession since the mid-1970s. Given the rapid growth and globalisation of the industry—worldwide employment in investment banks has risen by about four-fifths in the past decade, to around 400,000—the scale and reach of this slump is unprecedented. Since the salad days of just 18 months ago, worldwide revenues from investment banking have fallen on average by 43% at the big firms, and profits by 49%, according to Boston Consulting Group (BCG). As the chart below shows, Morgan Stanley saw the largest fall in revenues, and Goldman Sachs the sharpest fall in profitability, between the first quarter of 2000 and the third quarter of this year—though every investment bank has suffered.
Banks have suffered most in those areas that grew fastest. Underwriting initial public offerings (IPOs) of shares is one of the juiciest bits of investment banking. In the first quarter of 2000, $144 billion of equity capital was raised worldwide in IPOs, but only $44 billion in the third quarter of this year; there were no IPOs at all in September. Advising on mergers and acquisitions (M&A), another lucrative business, has also had an awful year. Deals announced in the first nine months of this year were worth $1.5 trillion, half the levels of a year earlier. The falling value of shares has cut the fees from asset management. Goldman Sachs has seen the fees from managing the assets of private clients drop from over $25m a week to less than $18m.
Lively markets in underwriting corporate bonds offset this to a degree—admittedly, mainly in investment-grade bonds, where the fees are slim, rather than junk bonds, which are more profitable. Credit derivatives have fared well, too. Providing brokerage to financial institutions, from pension funds to hedge funds, has also grown strongly, since fund managers have been adjusting their portfolios to reflect changing economic times and greater stockmarket volatility. Online trading by individuals, on the other hand, has ground almost to a halt. Who wants to turn on the computer, says Richard Strauss at Goldman Sachs, when looking at your portfolio makes you feel sick?...."
*************************************
Who indeed!?
uponroof
(10/29/01; 13:31:29MT - usagold.com msg#: 64333)
Banks, LTCM and derivative extortion.....er exposure
This post from Raging Bull in response to Hamilton's JPM Derivative Monster being posted there. The jist is, insider info beats models everytime. So, just how close (extortion) are JPMC and the gummint? Seems this theme is getting out on major investment forums, not just 'crazy goldbug' lore anymore. Cheers!
********************************************************
By: pmcw Monday, 22 Oct 2001 at 11:21 AM EDT
Reply To: 29039 by Culmus Post #29046
Culmus, That was a very enlightening read. The subject is so complex it obviously can't and does not try to explore the depths. It didn't even address the tangent of the Fed holding back rate decreases during the late spring and summer of 1998 as a driving factor in LTCM's problems. As you will recall, immediately after Greenspan made his rounds to virtually all of the large LTCM investors seeking bailout capital, he returned and provided a double drop followed my more cuts. This "new" money (the "bailout" money) earned huge returns and basically turned LTCM's portfolio right side up.
Sure, the Russian financial crisis was a huge influence in 1998, but even a blind monkey could see it coming. I dare say, the prediction for the brain trust at LTCM was a non-event. However, all credible logic would have also dictated that Greenspan would initiate interest rate cuts by early Summer at worst. However, at this time, Greenspan was also taking advantage of being unpredictable. Something a little difficult to model, even for LTCM.
Even though logic absolutely said cuts should start by early Summer, there were no driving issues during that Summer that demanded the cuts be implemented. Remember, Greenspan was still "high" on irrational exuberance. Due to this, being unpredictable was a way for him to keep markets from running wild.
The point here is that LTCM was not acting irrationally. Their play was well known by their investors. With leverage comes risk. Any time a strategy is designed to beat the yield of it's index, it adds risk to that carried by the index. Knowledge, in the form of knowing all that is publicly available and the ability to analyze the data from all possible perspectives - (decode the true meaning of all publicly available data), can mitigate this risk, but can't reduce it to the risk level of the index. However, even a dummy with critical "insider" knowledge can reduce the risk of any investment to one that is significantly lower than the index risk. In other words, a dumb crook can beat the best brains if the crook has just a little of the "right" knowledge.
I think history proves (by the fact it fell) that LTCM was operating with only publicly available knowledge and was relying on their superior knowledge to optimize the risk:reward ratio. As the article states, they leveraged, by one measurement metric at a rate of 417:1. However, without the solid benefits present at LTCM, JP Morgan is leveraged at a rate a full 50% greater. This might leave one to think JP Morgan is operating with all the prudence of a drunken sailor on leave after six months at sea, but do you believe this?
Would one of the top investment banks in the world leverage their investments at a rate of 626:1 without any insider information? I personally find it hard to believe and, evidently, some others feel the same. The following is from the article you linked:
http://www.zealllc.com/commentary/monsterpf.htm
"For us, Howe's fantastic "Gibson's Paradox Revisited" essay finally lit the proverbial lightbulbs above our heads that triggered a solid understanding of Michael Bolser's shrewd earlier hypothesis on JPM's enormous interest rate derivatives exposure! Gibson's Paradox helped to reconcile the puzzle and answer nagging questions about JPM's gargantuan interest rate derivatives position and how it could relate to the active management of the price of gold.
If factions of the US government in the Clinton years from 1995 to late 2000 were really actively manipulating the gold price (as the latest amazing research of government records by James Turk and Reginald Howe certainly strongly suggests through ever-increasing evidence), and if JPM really had inside knowledge of some of these operations as its anomalous gold derivatives activity seems to imply, then it is only a short logical step to assume that a possible catalyst for the explosion in JPM's interest rate derivatives operations was the artificially pegged price of gold!
Gibson's Paradox, defined by Lord Keynes, effectively claims that under a fixed gold price regime real interest rates remain predictable. If JPM top management was participating in any US efforts to cap gold, they had full knowledge that a de facto fixed gold price regime had been stealthily established and they would have had a carte blanche to massively balloon potentially highly lucrative interest rate derivatives exposure. After all, if JPM was convinced gold was under control, and that gold prices were a prime driver of real interest rates, then what better time to become the king of the interest rate derivates world than when gold was being quietly hammered down through massive sales of official sector gold from Western central banks’ coffers?
Our superficial presentation here certainly does not do this startling hypothesis justice, but the JPMorganChase interest rate derivatives explosion due to JPM upper management knowledge of and possible involvement in stealthy government machinations in the gold markets is a very intriguing hypothesis that definitely warrants further investigation and discussion. We may write a future essay on this topic alone after we dig deeper, and we certainly hope other analysts and researchers follow Michael Bolser's original lead and do some serious investigating."
If this is true, the only questions that remain are:
1) Are the lines of "communication" still open that allow JP Morgan to know information before it is made public?
2) Is there still undue manipulation of key international rates / gold?
Only time will eventually tell the truth, but, IMO, there are those who are bound to know long before the truth is a public commodity.
Regards, pmcw
Netking
(10/29/01; 13:30:37MT - usagold.com msg#: 64332)
Silver - Technical indicators
http://www.technicalindicators.com/silver.htm?321gold
Technical Ag indicators as at close of business last Friday are not particularly bright, but what's new. Just don't get us started on fundamental factors!
USAGOLD/Centennial Precious Metals: Have you noticed much in your geographical location as a Company (or within the industry) of a physical Ag squeeze in the early stages?
site steward
(10/29/01; 13:26:37MT - usagold.com msg#: 64331)
Fed adds permanent, temporary reserves
Outright purchases in the form of a Treasury coupon pass today allowed the Fed to add $478 million in permanent "high power" money to the reserves of the nation's banking system.
With the market in overnight fed funds trading slightly tight at 2.56 percent, the Fed also added $4.8 billion in temporary reserves via open market operations with overnight repurchase agreeements at a stop out rate matching the current FOMC target (2.5%).
The Fed also added $3 billion with 28-day repos at an average stop out rate near 2.25 percent, thus tipping the market's hand regarding expectations of next Tuesday's FOMC meeting.
"Easy money policy" getting easier. What WILL the world's dollar-holders think?! tsk tsk
This would be a good week to take your chips off the table. In other words, harvest time.
R.
diehard
(10/29/01; 13:02:09MT - usagold.com msg#: 64330)
Germany`s Demand for Pm`s
According to a coin dealer in the suburbs of Munich demand for gold Gold bars and gold and silver coins has risen substantially. It may have to do with the forthcoming introduction of the Euro , the most questionable trial to make a capital cut or trial to make debt somewhat disappear for a short term to inflate the money supply in the aftermath and produce inflation in the apparent stagflationary environment, which already exists.
Ebay has also seen a heavy traffic in coins changing hands.
Especially silver in Maple Leafs and US Eagles are still sufficiently available and can be supplied, as well as 1KG (32 ounces) silver bars of DEGUSSA, wrapped in plastic folie.
If someone has been holding Gold bullion coins since July 1999 he/she is now sitting on a profit of 10 - 15 % a year in Euro/$ terms. When a parity $-Euro is reached windfall will then wane and gold will shine bright again. Suckers of NEMAX 50 or Dax investors stucked with their paper are still leaking their wounds and feeling grim.
When I was attending a coin and stamp circle meeting this weekend I was talking to an old stamp collector , who was also aware of the golden times of the eighties and he said, after having already drunk 4 cups of Weissbeer because being bored of lacking customers to buy his stamps, that silver had reached 17.000 Deutschmarks on it`s top by the time of 1980 oops.. of course not that much, I reckoned and the result due to the strong Dollar (equaled to 3 Deutschmarks in 1980) was indeed an awesome and astounding 4.800 Deutschmarks per Kilo. ) compared to 380 DM per Kilo for today.
All this makes one clear, storing away Gold and in particular silver as the ultimate way to lock in value at the right time makes especially me sleep sound at night.
And... it suley won`t cost you an arm and a leg !
uponroof
(10/29/01; 12:30:38MT - usagold.com msg#: 64329)
Banks
Tommy P-thanks for the Argentina link. This escape is going to be very interesting to watch. Perhaps some banks may actually lose their a$$es. I wonder why Merril was chosen?
Some thoughts on banks in general.
Banks must grow or they fail. The need to find new capital to offset bad loans, which are inevitable in good or bad times, is a pressure that is always there. If banks have a nominal 1% failure rate on all loans, they are actually experiencing 10-15% capital deterioration rate. Fractional reserves be damned. Today's climate will increase this pressure.
And so, banks must always be seeking out 'growth' by buying out smaller banks with less bad loan exposure or by being taken over by bigger banks.
Over the last 7+- years 'growth' through OPM (other people's money) has mutated through derivative abuse. Instead of showing growth, banks are showing 'mutation' at the risk of OPLM (other people's leveraged money). Actual healthy growth has been replaced with 'too big to fail' gummint sponsored, mutated banksters.
Not only is this extremely 'creative bookeeping' (which would land most of us in jail if we tried it) but the heart of this principal is based in extortion much like the suicide terrorists who plan on taking others with them. It is a very small step from "I'm too big to fail" to "You better not let me fail" (I'll take you with me).
So, now when we evaluate a bank we must determine how much there is to lose, if it does indeed fail, to measure their 'growth'(mutation) and 'health'(extortive relationship with the gummint).
Is it any wonder that smart folks don't trust banks.
sourdough
(10/29/01; 12:02:56MT - usagold.com msg#: 64328)
confidence ? better keep it in your pocket
October 29, 2001
US$105m goes missing after Sept 11
Several First Equity execs also vanished following attack on World Trade Center
(NEW YORK) When 2 World Trade Center collapsed after the Sept 11 terrorist attacks, the employees of First Equity Enterprises all escaped from their 15th-floor offices. But a few weeks later several of the company's executives appear to have vanished along with about US$105 million.
The US attorney in Brooklyn and Postal Service inspectors have started an investigation into the missing money at the request of another Manhattan firm, Evergreen International Spot Trading.
First Equity Enterprises had acted as Evergreen's clearing house, taking in funds, issuing statements to clients and disbursing money to those who wanted to cash out.
Sales agents and traders at Evergreen received complaints from their customers who said that after stock market trading resumed on Sept 17 they called First Equity to inquire about their accounts or to take out some cash, only to have their requests ignored.
From US$105 million to US$106 million is missing and belongs to 1,400 investors in 14 countries, according to reports in newspapers in Australia, Britain, Canada and New Zealand.
First Equity was created four years ago using a Brooklyn address.
Federal prosecutors issued a warrant on Oct 5 to seize funds connected with First Equity Enterprises. But on Friday night, Bill Muller, a spokesman for the US attorney in Brooklyn, said he did not know if any funds had been recovered or frozen.
One bank account in Melbourne, Australia, has been frozen, The Australian Financial Review, a business newspaper, reported on Oct 19.
An American law enforcement official, who insisted on anonymity, said that 'the way they did it is brazen' and 'it is not the first time these people have done this'.
Mr Muller said he did not know if arrest warrants had been issued for any First Equity executives.
Two weeks ago, postal inspectors conducted searches, with Evergreen's permission, of its offices at 40 Wall St, 61 Broadway and 730 Fifth Ave.
Justin Fauci, an Evergreen salesman who had raised much of the money, sought the investigation after receiving complaints from customers that First Equity was not responding to requests from some customers to withdraw some of their cash. He and others at the company assembled documents and hired a lawyer, who went to federal prosecutors.
The Evergreen employees have retained James McGuire, a partner at the White & Case law firm in Manhattan, to represent them in this matter.
Mr McGuire said on Friday: 'I can only confirm that a federal investigation into the missing
WAC (Wide Awake Club)
(10/29/01; 11:02:23MT - usagold.com msg#: 64327)
Asylum seekers to carry ID cards. The weak first. Everybody else later.
http://www.thisislondon.co.uk/dynamic/news/story.html?in_review_id=469451&in_review_text_id=423443
All asylum seekers will be forced to carry an identity card bearing their fingerprints under a radical programme of reforms to the refugee system
Tommy P
(10/29/01; 09:59:04MT - usagold.com msg#: 64326)
(No Subject)
http://quote.bloomberg.com/fgcgi.cgi?ptitle=Top%20Financial%20News&s1=blk&tp=ad_topright_topfin&refer=topsum&T=markets_bfgcgi_content99.ht&s2=blk&bt=ad_position1_topfin&middle=ad_frame2_topfin&s=AO91ufhXdQXJnZW50
Does not look good for the banks
BR549
(10/29/01; 09:12:55MT - usagold.com msg#: 64325)
POG $275/oz.
USAGOLD---"Gold improved in the early going with $275 looking more and more like a strong support level...."
Some of think that the Fed has established the POG at a pegged price of $275/oz. based on a speech AG gave in Houston many years ago. He said (I don't have the quote, perhaps someone does) in so many words that the job of the Fed was to simulate an unofficial Gold Standard.
Regards,
BR549
sourdough
(10/29/01; 09:07:52MT - usagold.com msg#: 64324)
wouldn`t it be ironic
I have reposted this from yesterday with a few comments.
The government situation in this predominantly Muslim country must be extreme for the prime minister to make a statement such as this. When your prime minister comes out and says your country is on the way to disintegration, what are it`s citizens to do. I believe the government has issued a GOLD coin (someone care to expand on this coin?)
One would expect even more pressure on their currency after such a statement. This has to be bullish for gold. Wouldn`t it be ironic that it was "an Indonesian gold mine" that destroyed gold stock investments and it may be an "Indonesian" currency disintegration that brings it back!
(by the way what is preventing an Islamic edict from extremists stating U.S. Dollars are "unclean" and must not be touched, after all, shouldn`t they view it as vile as the flag?(A coating of white powder would go along way to making this "unclean" propaganda a reality.
sourdough (10/28/01; 11:22:35MT - usagold.com msg#: 64285)
INDONESIA
October 28, 2001
Megawati warns of possible disintegration of Indonesia
JAKARTA - President Megawati Sukarnoputri today warned Indonesia could "become the Balkans of the eastern hemisphere" if her countrymen did not work harder at keeping their nation together, the state Antara news agency reported.
Miss Megawati said that unless conflicts between ethnic and religious groups and villages were halted, the nation of more than 210 million people spread over some 17,000 islands faced breaking up into a series of tiny powerless states.
She also warned that anti-American sentiment sweeping the country - the largest Muslim-populated nation in the world - since the US launched its attack on Afghanistan was causing foreign investment to dry up.
"We will become the Balkans of the eastern hemisphere that will not only never enjoy happiness among ourselves but also will represent dangers for nations around us," Miss Megawati said, according to the state Antara news agency, at a ceremony to mark Youth Pledge Day.
"We will become smaller nations with equally smaller states which will be more susceptible to so much pressure from outside," she said.
Hardline Muslim groups have threatened to conduct sweeps to drive out nationals from the United States and its allies following the US attacks on Afghanistan, although no such sweep has taken place so far.
She warned that the lack of security in the country had began to thin out the inflow of foreign investment into Indonesia, and said some foreign companies were preparing to leave.
"The absence of a feeling of security now is not only felt by our own people, but has also affected the diplomatic circle and several foreign companies whose presence here is still needed," Miss Megawati said.
"Nowadays, not only the arrival of foreign companies has been drastically reduced, even companies which are already in the country are also preparing to leave us," she added.
She said that even though Indonesia was determined to work to shed dependency from other nations, it still needed foreign capital and investment to finance development.
She called on all Indonesians to think of national unity above their own aspirations.
"Riots and violence should be stopped by everyone," Miss Megawati said.
"We have to restore and guarantee a feeling of security for all people residing in this country, be they citizens of the Republic of Indonesia or foreigners," she said.
Cavan Man
(10/29/01; 09:03:22MT - usagold.com msg#: 64323)
Rather, it is just beginning....
Argentina Signals Default on Foreign-Held Debt, Hires
Merrill
By John Lyons and David Plumb
Buenos Aires, Oct. 29 (Bloomberg) -- Argentina signaled it would default on at
least $38 billion of debt held by international investors when it hired Merrill Lynch
& Co. to help renegotiate the terms of the securities. Bonds tumbled.
``It seems like maybe we're getting closer to the end,'' said David Bessey, who
manages $1.5 billion of emerging market debt for Prudential Financial, Inc.,
including Argentine bonds.
Argentina's 3 3/8 percent floating rate bond due 2005 fell 4.8 to an offer price of
60.50, the lowest in five years, to yield 36.6 percent. The yield has more than
doubled since June.
The government said it selected Jacob Frenkel, president of Merrill Lynch
International, to advise on a swap of the country's foreign-held debt with new
securities that would pay lower interest. Argentina, which has tried to cut
spending and raise taxes to avert a debt default, will use International Monetary
Fund loans to help guarantee the new bonds.
Argentina also is in talks with domestic banks and pension funds to swap at
least $14 billion of federal and provincial bonds for new securities that pay 7
percent interest, compared with a current rates of about 25 percent.
An IMF team will be in Buenos Aires today. Economy Ministry officials plan to
seek an early disbursement of $1.2 billion in IMF loans originally set for
December, Clarin newspapers reported. Officials also plan to tap $3 billion
earmarked by the IMF to help complete its bond swap.
International Holders
The country has a total $132 billion of public debt, including about $95 billion of
bonds. The government estimates international investors hold about $38 billion of
the bonds; Merrill says international bondholders own $45 billion worth, while
other banks say the amount is as high as $55 billion.
``We are going forward with an operation to lower interest rates, which will be
voluntary, without affecting investors or depositors,'' Economy Minister Domingo
Cavallo said on national television last night. ``The plan is ready and has
consensus, but before we can announce details, there are still deals to be
worked out with the International Monetary Fund and banks.''
Moody's Investors Service this month lowered Argentina's credit rating to the
lowest of any country, at ``Caa3.''
BR549
(10/29/01; 09:02:44MT - usagold.com msg#: 64322)
Hedgers--Too big to fail
SteveH (msg#: 64309)---"Well thought out, I thought. You asked why they hedge? You said to protect their largest clients? Perhaps, these bankster hold undo influence over these miners and therefore they control the price of gold, through unlimited credit creation and are subsequently too big to fail."
Great thoughts! It is obvious to me that the acceleration of derivatives over the last few years has influenced and lowered the price of spot gold.
The more Gold that is being produced, the higher the supply, and the lower the price. At least that is the way it would work if supply and demand set the POG like with other commodities. Anytime the banksters start to run out of unfettered Gold inventory via over leasing, swaps, outright sales, and selling the metal short, they simply call in their chits from their forward sales granted to the miners and thereby increase the supply the other way. There is some question as to whether they then count this unmined Gold within their inventory. If they did, then that would simplify their Gold inventory replacement (not that they would "cook the books").
As far as the unlimited credit creation that you so astutely point out—That would also explain some of the question as to why the mountain of "paper" derivatives so vastly out numbers the actual collateralized gold backing of the same derivatives. There is no question in my mind that the goal of the CB/BB's is to drive the independent miners out of existence, because they cannot control them, and influence the large miners via forward sales.
My research to date indicates that if it was not for the massive amount of liquidity that the CB/BB's inject into the gold markets via both utilizing their ownership of physical and their ability to create credit out of thin air, there would be no vast mountain of derivatives vs. physical. The creation of credit drives fiat and suppresses the corresponding POG, again to the detriment of investors in PM's and to the benefit of the JPM/C's of the world.
As far as being "too big to fail"--so was the stock market at one time.
I appreciate your comments.
Regards,
BR549
USAGOLD
(10/29/01; 09:01:06MT - usagold.com msg#: 64321)
Today's Commentary: Gold, Dollar, Equities Surprise Traders This AM
http://www.usagold.com/Order_Form.html
Note: If you would like to receive an information packet on gold (how to buy it -- our products and services) and a free trial subscription to our newsletter, News & Views, please go to the link above. For those seeking a higher level of understanding with respect to the gold market, many of the portfolio issues addressed briefly below are covered in detail in our latest 32-page Quarterly Review. Please go to the link above to register for your packet. Registration includes trial period access to our Commentary & Review page. Today's report sans links and referenced articles is offered below for those first-time visitors who might have an interest in an (almost) daily report on the gold market with our spin not the mainstream media's. MK
Note #2: This Quarter we have a surprise lead article -- one of the best articles on why one would want to own gold written in a long time, and no it isn't Dr. Moneywise, though some would call him that.
10/29/01
Gold improved in the early going with $275 looking more and more like a strong support level and the dollar taking a nasty tumble in overseas markets. The dollar, it seems, is having a delayed reaction to the European Central Bank's decision to leave euro rates untouched. Meanwhile press reports over the weekend speculated that the Federal Reserve was about to lower interest rates again at its November 6th meeting. As we have said before, though real rates of return fail to catch the notice of the mainstream media, they remain uppermost in the minds of international money managers and that more than any other single factor is what's driving the dollar lower.
Gold should benefit somewhat from this attitudinal change in the currency markets, and equities are likely to suffer. Reuters reports good physical demand this morning with options expiration playing a role in pricing. One trader speculated that once options expiry is out of the way gold could go on a roll. "A good technical outlook," says UBS/Warburg, should keep physical demand moving forward and adds, perhaps presciently, that "only big moves in equities and currencies will rock the metals market again." As we go to fetch this report over to the server, gold is up $1.70 thus far on the day, the DJIA is down 162 and the euro up a full penny.
Along these lines, the Financial Times article immediately following might be of interest:
* * *
GOLD: The Public Is Beginning to Show a Renewed Interest With Enquiries Rising on How to Invest
Financial Times - Oct 27, 2001 - Private investors have been showing an unusual degree of interest in gold bullion
Cavan Man
(10/29/01; 09:00:10MT - usagold.com msg#: 64320)
History Repeats Itself (again)
"Good morning Viet Nam"
U.S. Sees `Long' War; Allies Consider Ramadan
Pause (Update3)
By Kate Linebaugh
Kabul, Afghanistan, Oct. 29 (Bloomberg) -- The U.S. said it's prepared for a ``very
long'' campaign in Afghanistan, while a U.K. cabinet minister said the allies are
weighing a bombing pause during the Muslim holy month of Ramadan.
Weekend strikes killed at least 13 people in Kabul, Afghanistan's capital, the
Associated Press said. Nine were children, according to Qatar-based Al-Jazeera
television. Agence France-Presse said it confirmed 37 civilian casualties in Kabul
since the bombing began on Oct. 7.
As casualties mount, the U.S. and its allies say the conflict won't end soon.
``This is a very long process,'' U.S. Defense Secretary Donald Rumsfeld said on
Cable News Network's ``Late Edition'' program. ``I think the American people
understand ... it's going to be long and hard.''
Centennial Precious Metals, Inc. / USAGOLD
(10/29/01; 08:01:12MT - usagold.com msg#: 64319)
'Tis the Season...
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