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Welcome to the USAGOLD Gold Discussion Archives. Looking to buy gold coins and bullion? 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. To join the debate request a discussion password here.

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ARCHIVED DISCUSSION FROM 12/29/2005
All times are U.S. Mountain Time

(Yesterday's Discussion.)

Sundeck (12/29/05; 23:09:03MT - usagold.com msg#: 139858)
Gold and booze and cigarettes and wimmin...
YGM, the fourth stanza of Rozier's gold and silver poem reminded me of a quip from the late and great George Best, the famous world football star...

He died rather poor, having made a lot of money as a soccer star. Asked what happened to it all, he said:

"I spent a lot of money on booze, birds and fast cars. The rest I just squandered."



And so often it is with people and nations..."great" deeds are done and the gold gets passed around to hoard and to squander...and to hoard and to squander again and again. People come and go, but gold remains...

A Happy New Year to you...

:-)



PH in LA (12/29/05; 22:59:22MT - usagold.com msg#: 139857)
Trolls, etc.
Dear Randy,

Please don't ever even think, imagine or suspect that I had, or every will have, anything to say about silver vs. gold. I don't!

I do object to any poster that (for whatever reason) clogs up the forum with gratuitous name-calling like the following:

"Rich Galearis: Nice tag team. Hijackers. Johnny one notes. Shameless, boring promoters. It's all staged..." etc.

Such rudeness deserves censure by the authorities for the offense it offers to readers. It is completely ineffective as argument, too.

I was only trying to point this out... not comment on the content of dear Flaccus' post, since I consider name-calling to be basically contentless (if there is such a word).


YGM (12/29/05; 22:08:30MT - usagold.com msg#: 139856)
Whose Gold & Silver?
The Silver And Gold Is Mine.
By: Irvin Rozier



Many ounces of silver and gold have been found
Some in gurgling rivers and beneath the ground
God placed all that silver and gold there
I just found a silver dime under my chair

It is amazing where silver and gold can turn up
Gold has been fashioned into many a pretty cup
Tons of gold and silver have been lost in the sea
Treasure hunters will dive for it for a hefty fee

Man does not really own the silver and gold
Through the ages much has been bought and sold
Without gold or silver man came from the womb
And he can't take any with him to his tomb

He dies and leaves his gold and silver for others to use
Much of it is spent on gambling, sport and booze
Not a single silver or gold coin is of use in death
It is all left behind when man draws his last breath

Greed has been the downfall of many a nation and man
Some lost their life over that gold nugget in that little pan
Life on earth is very uncertain and is very short
Where are all those people who built the Knox Fort

I know that God is the owner of all the silver and gold
He even has gold paved streets in heaven it is told
So remember that the gold and silver is not your own
It was given to you from God as a temporary loan

Treasures laid up in heaven are safe and secure
Turn your eyes upon Jesus and from gold's alure
He'll give you peace of mind that thieves cannot steal
And life eternal in heaven that is O so real

Copyright 2005 Irvin L. Rozier, author of My Walk with the Lord





YGM (12/29/05; 22:04:31MT - usagold.com msg#: 139855)
Best of The Coming Year To All.
Silver and Gold:

Make new friends, but keep the old;
Those are silver, these are gold.
New-made friendships, like new wine,
Age will mellow and refine.
Friendships that have stood the test-
Time and change-are surely best;
Brow may wrinkle, hair grow gray;
Friendship never knows decay.
For 'mid old friends, tried and true,
Once more we our youth renew.
But old friends, alas! may die;
New friends must their place supply.
Cherish friendship in your breast-
New is good, but old is best;
Make new friends, but keep the old;
Those are silver, these are gold.


OvS (12/29/05; 21:47:00MT - usagold.com msg#: 139854)
Up-date via CIA
World: 55.5 trillion
USA: 11.7
China: 7.3
Japan: 3.7
India: 3.3
Germany: 2.3
UK: 1.7
France: 1.7
Italy: 1.6
Russia: 1.4
Hong Kong: 0.2
Belgium: 0.3

Why do I hate statistics?
Because you can massage
the data...


OvS (12/29/05; 21:08:29MT - usagold.com msg#: 139853)
To put things in perspective:
USA GNP is about 11 trillion.
Runner up is about 4 trillion.
It is estimated that within
5 years the US military budget
will be more than all the
nations of the world put to-
gether...
Whatever the true GNP of China
is, Hong Kong's part is 1/3rd
of the mainland...


OvS (12/29/05; 20:51:55MT - usagold.com msg#: 139852)
Pritcho
If you're not banned
at least wash your
mouth out. There are
ladies abord. OvS


David Linkley (12/29/05; 19:57:29MT - usagold.com msg#: 139851)
@TownCrier
You assume that the intentions of central bankers and politicians are benevolent yet who do they really work for? What greater justice can be done for a society then the assurance of money as a store of value? History has shown us brutely that central bankers are in place at the whim of the true ruling class. Both bankers and politicians must feed the hands that put them there.

I'm just asking you if you really know the answers to any of the questions I've asked? You supply the board with terrific information but somewhere along the way your personal sense of proportion has left you. The system that is now being arranged is being done covertly and without popular acceptance and or support.

You assume to know the structure and goals of this new order but fail to ask or answerer key questions. Don't assume anything during times like this. A true economic war is underway and know one knows the ultimate outcome. I hope and pray that it is as simple as you suggest, but I fear history and reality will not be conned!


PRITCHO (12/29/05; 19:33:06MT - usagold.com msg#: 139849)
Latest From Richard Russell (Richards Remarks)
http://ww2.dowtheoryletters.com/DTLOL.nsf

Snip: (From the start -no breaks or out of context)

December 29, 2005: "You are a den of vipers. I intend to rout you out and by the Eternal God I will rout you out. If the people only understood the rank injustice of our money and banking system, there would be a revolution before morning." --Andrew Jackson, 1828 (to a group of investment bankers trying to persuade him to renew their bank charter).

Russell note -- Tough old President Andrew Jackson closed down the Second National Bank, which was somewhat comparable to the Federal Reserve of today.
.....................................................................................

Question -- Is silver a precious metal?

Answer -- Yes.

Question -- Is silver a monetary metal?

Answer -- Unclear. Silver definitely used to be a monetary metal, and originally the dollar was defined in terms of silver. We've had silver coins in the US until recently when the Treasury substituted base metal for silver in our coinage. Even the copper has been taken out of our lowly penny. If the Treasury could find a way of making out coins out of bat guano, I have no doubt that we'd be pocketing "bat dimes and quarters."

But let's turn the precious metals, gold and silver (I'm leaving out platinum and palladium). Since last September silver has been outperforming gold. Classically, it took around 15 ounces of silver to buy one ounce of gold. That ratio has faded away, and today it takes 57 ounces of silver to buy an ounce of gold.

Many metal experts believe that silver is too cheap and are hoping that the ratio heads towards the old 15-to-one again. Since September, the ratio has been contracting in favor or silver. The daily chart below shows the ratio of gold to silver with silver increasing in relative strength.


TownCrier (12/29/05; 19:24:15MT - usagold.com msg#: 139848)
David Linkley, a comment on your words
You asked, "The dirty little secret is there will be no transition as smooth as possible. Once the freedom loving peoples of the world find out what has been done to them, all hell is going to break out. How do you smoothly transition from hundreds of $trillions of debt and derivatives to a new global economic order smoothly?"

How do you smoothly transition? The short answer, again, is: as ____ AS POSSIBLE.

I think you are choosing to overlook a very obvious condition simply in order to advance an opportunity to harp.

If you can accept, for even the briefest of moments, that central bankers within their terms of employment each have something that is akin to a Job Description or a 'work order', then I think the rest of my original point will naturally follow if you can also accept that the manner of conducting affairs can be done anywhere along the following general spectrum of perfectly bad to perfectly fine.

Perfectly Rough>>>>As Roughly as Possible>>>>Roughly>>>>As Smoothly as Possible>>>>Smoothly>>>>Perfectly Smooth

As you can see, "as smooth as possible" is indeed closer to "Roughly" than it is to the impossible "Perfectly Smooth". And to conclude my say in the matter, in the fulfilment of one's job description, a very human central banker will indeed gravitate toward "as smoothly AS POSSIBE", and that is indeed how it is to be done.

So in case you completely missed my delicately stated point as spelled out geometrically above, the transistion will NOT be Smooth, and you must prepare yourself for a Rough ride.

It is times like this that I am convinced that economic newsletter writers in general have numbed their audiences with such a high degree of vitriol, overstatement, sensationalization and hyperbole that any normal attempt to state something candidly and matter-of-factly completely fails to register as anything of note in the desensitized mind of the modern oversensationalized reader.

In a final note for the benefit of future translators: in a conscious effort to maintain both dignity and credibility, I do not tend to overamplify a case in point, but rather aim for a presentation that is as calm and direct as possible. If that means somebody has to run it through the soon-to-be-patented "Wowzers-O-Rama Amplification Sensationalizer" in the privacy of their own office in order to hear what I'm saying, then so be it. I offer the following to help calibrate your equipment:

A diversification into physical gold continues to be a prudent course of action at this time.

W-O-RAS Translation: "Holy crap, people, the freakin' sky is falling and the damn gubmint is asleep at the wheel!!! Buy as much gold as you can, back up the truck and start loading because this is the kind of opportunity that comes not just once-in-a-lifetime but rather once in the history of an entire civilization!!"

With your blessing, I will now return to my garden-variety bland presentation.

R.


contrarian (12/29/05; 19:23:49MT - usagold.com msg#: 139847)
David Linkley--Transition
Agree that there will be no "transition" to any new currency system. Rather, it will be like a phase change as when water freezes to ice, not gradual, but sudden. There was a book recently written about tipping points, how things quietly gather momentum, and then suddenly change, having reached a tipping point.

Au contraire, regarding gradual changes, the world just doesn't work that way, all hunky dory. People have to be dragged screaming to the table. Or clubbed in the head! And sometimes it takes war!


PRITCHO (12/29/05; 19:18:13MT - usagold.com msg#: 139846)
In Belated Support Of Rich - - - - (Mid Morning in Perth)
I was surprised, to put it mildly, that TC took such violent umbrage at what I read as being a very tongue in cheek remark!

IT was also said with a humourous intent, which would have been patently obvious to anyone who is familiar with the exchanges that have been ongoing here.Obvious that is to anyone with a sense of humour.TC has been incredibly thin skinned over this -AND I hope his NEW YEAR resolution will
be to get him some tolerance & sense of humour.


TownCrier (12/29/05; 18:23:06MT - usagold.com msg#: 139845)
PH in LA, on "expelling trolls"
Is it possible that I'm focused to the point of bias? Or is it simply that you and I have distinctly different perspectives as befitting our distinctly separate experiences of nurture and nature? Regardless, as far as I've been able to discern, the only thing Flaccus is guilty of is expressing a desire to visit USAGOLD to gain some insights into gold -- without having to do a great deal of scrolling through unrelated matter.

I do not see that as a wholly unreasonable expectation. In fact, not many hours ago I expressed to Rich that among my various endeavors in association with USAGOLD is "...trying to help keep this discussion forum filled with gold-related news and insights as a service to Centennial's current and prospective clientele."

And to be sure, given the very real (generally silent but ever-present) volume of gold clientele as compared to the small handful of silver hawkers (fewer still of whom ever actually appear to take any action comensurate with their words), the scales overwhelmingly tip in favor of serving the needs of those wishing for gold news over ensuring whether or not silver promotionals are accorded due or undue status.

As I've explained before, it is very easy for me to completely overlook notions of "fairness" regarding the sorry state of silver posters because even as I arrived on this scene I had long previously reached a fitting conclusion that silver, as a potential investment, merits no greater or lesser consideration than does a whole host of other standard commodities ripe or unripe for speculation.

Gold, on the other hand, is central to a profoundly different situation quite worthy of rigorous discussion, as any diligent reader can attest.

R.


Sundeck (12/29/05; 18:02:27MT - usagold.com msg#: 139844)
China and silver and gold...and the mercantile "value" of gold
Rich #139821

You're welcome...

There are many evocative themes in the Flynn and Gir·ldez essay. I am pondering a few of them.

One that leaps out is the resurgence of demand for precious metals following a population/economic boom that the authors argue was connected with the introduction of New World food plants (maize, sweet potatoes, potatoes and peanuts, in particular), thereby permitting agricultural production on land hitherto unsuitable for traditional food-crops. The secondary boom in the silver price was brought about by the increased demand for silver in an already "silverised" community...a demand that could not be immediately met with available supply; leading to a rewarding arbitrage trade for around a hundred years.

I think that this circumstance is not dissimilar to the present one in which increased wealth of a quasi-stable (rather than increasing) population places growing demand upon available supplies of precious metals in an environment where the suppliers of those precious metals are either scrambling to meet forseeable demand (coming off reduced mine profitability for the last 25 years) or are deliberately withholding supply (the large holders...CBs and the Buffetts etc) in a long-term bull market.

There are several other parallels with modern times...more later, if I get a round tuit.



TownCrier #139832

I suspect that there may be a lot in what you say about the free-trading of gold by the ECB.

The confidence in any market is enhanced if exchange of goods and services is liquid and the players see more and more of the cobwebs of suspicion blown away: secrecy, protectiveness, double-dealing, living-in-the-past attitudes, manipulation, etc, need to be removed for a good to trade freely at a fair price. These impediments have surrounded gold dealing for many years now...assisted by the anachronism of the UST booking its gold reserves to $42.

I suspect the UST is in one heck of a quandry about its gold reserves in a growing MTM environment. (a) Reserves may not be as plentiful as it is claimed ("deep-storage" gold and the plethora of loans and swaps and leasings that grace the financial world). (b) MTM would be a tacit acknowledgement that gold, not FRNs, is the ultimate international monetary and wealth reserve. (c) The US financial system is not ready for gold's emancipation...rather like China's financial system is not ready for a floating renminbi. (d) An embarrassing political/monetary backdown signalling that the (loathed) French may have been right all the time...or, at least, since the early '70s.

One more point. The very large gold reserves held by the European banks must surely be a "mercantile lubricant" in dealings with a China (and Asia in general) that has overtly expressed its willingness to embrace gold as a national (and personal) asset; and a China which is currently supposedly short of desired gold reserves. The MTM/mercantilist stance of "Olde Europe" with respect to gold must surely have stolen a march on "Young America" with regard to "bargaining power" in Asia; not just in gold dealings per se, but in the all-important door-opening phase of larger trading arrangements.

Cheers

:-)



David Linkley (12/29/05; 17:53:53MT - usagold.com msg#: 139843)
@TownCrier (Mark to Market day tommorrow)
TownCrier you are drinking too much of your own cool aid once again as you make assumptions which are as arrogant as the world elitists have become. I agree that the world is moving towards an evolved financial system but it is distinctly stealth in nature. I don't remember me or anyone else having a chance to study or vote on it. Exactly who is pushing for this system and to whom is it to benefit? Do you know to whom all these ECU gold sales are being made? Do you know why much of the world is going deeper into debt and who is lending them the money to do so? Why is the US as rapidly as possible centralizing the economy and power in DC? Why is Britian following in the same path?

The dirty little secret is there will be no transition as smooth as possible. Once the freedom loving peoples of the world find out what has been done to them, all hell is going to break out. How do you smoothly transition from hundreds of $trillions of debt and derivatives to a new global economic order smoothly?

The Washington Agreements were a signal to the market that the endless leasing of gold was coming to an end. Central bank gold sales are positive for the price of gold long-term because it removes political overhead supply.

It is obvious to me that the current insane policies of the US (no energy policy, piling on more debt, a war of endless attrition, etc.) are diversions to help implement this new policy. IMO this is leading first to a defacto end of rights in the west and a ruling class (who will end up with most of the gold) of the likes never seen on a global scale. So go ahead and tout your brilliance as you see it. I agree with you on one point, own the physical.



Goldilox (12/29/05; 17:33:56MT - usagold.com msg#: 139842)
Return of Decorum
@goldquest,

My hopes exactly. When a discussion deteriorates into name calling and perceived accusations, the kettle is boiling a bit hot for even-tempered continuation. Maybe we all need to take a deep breath and slowly exhale.


TownCrier (12/29/05; 16:21:17MT - usagold.com msg#: 139841)
968, thanks for the additional point
But the final figures may actually be closer than the 9% you've mentioned.

My current gold reserve calculation, excluding any gold movements for the current week and overnight price changes, peg the revalued gold value at EUR 164 billion, actually exceeding the current foreign currency position of EUR 161 billion.

However, (maybe you've already taken a rough stab at projecting the end-of-week net foreign currency positions and revaluations), we'll know with certainty by this time next week when the consolidated financial statement is published exactly how far the gold/paper ratio has evolved within those particular halls.

Meanwhile, we also know with certainty that the U.S. Treasury gold (held by the Fed as gold certificates) is still anachronistically (and antagonistically) valued only at $42 per ounce, all while the Fed's balance sheet grows ever larger on the back of domestic repos.

It's only a matter of time before the balance tips and all opportunistic prudence dictates to a stunned (if not wholly unreluctant) Congress to officially revalue our Treasury's gold on the floating tide and subsequently dishoard some of the ounces as needed to mop up the mess.

R.


goldquest (12/29/05; 16:11:09MT - usagold.com msg#: 139840)
@ Rich Powell
Rich, for what it is worth, you are one of my favorite contributors to this forum.
You have sparked many enlightening debates. The fiery clashes over silver, the past several weeks, shows that some folks are not considering the over all picture when it comes to precious metals.
I also have large holdings in silver, both physical and shares in some of the top silver producers.
I see nothing wrong in people taking different roads, to accomplish the same goals.
I would like to see the bitterness that has occurred over these debates, subside and return to a more friendly atmosphere.
P.S. I can also relate to your profession, as I to worked in concrete construction in the late '50s and early '60s.
An honorable profession to be sure.
Best wishes and prosperity, whatever your decisions may be.
goldquest


Topaz (12/29/05; 15:50:06MT - usagold.com msg#: 139839)
alt-PoG.
http://www.futuresource.com/charts/charts.jsp?s=GC&o=100/DX&a=W&z=610x300&d=LOW&b=LINE&st=
The Weekly comparison chart gives a good perspective on where we went as a whole during '05.
The truly optimistic can clearly define a "to da moon Alice" future for PoG as we head into a new year.
The "papery" nature of the beast though gives rise to a less enthusiastic prognosis that will be determined in another arena, namely the ongoing battle between deflationary and disinflationary forces in the global economy.

A Happy New Year to all.


Chris Powell (12/29/05; 15:49:53MT - usagold.com msg#: 139838)
Goldman Sachs acquires Italian central bank
http://groups.yahoo.com/group/gata/message/3571
Latest GATA dispatch.



To subscribe to GATA's dispatches, send an e-mail to:

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TownCrier (12/29/05; 15:40:59MT - usagold.com msg#: 139837)
Rich, on the offending use of "belief"
Had you said something along the lines of "TownCrier expressing his certainty that physical....etc" I can assure you that I would not have taken offense and it would have passed by like so much water under the bridge. (That was a metaphor.)

However, I've yet to meet the engineer who will commit to a bridge design under the mere "belief" that it will function without collapse. To downplay the necessary component of professional "certainty", which comes via years of critical study and scientific wherewithal with the principles of physics, is to dismiss precisely that very thing that defines the man.

(And, knowing your propensity to dodge and weave loose threads into straw men, before you object on the grounds that you said nothing about engineers, I will preemptively state that the above was an ANALOGY, choosing a very clear and easily graspable example as a means to make a parallel point.)

I appreciate Goldilox's attempt at interpretive reassurance, but from my experience, if it feels like "an elbow to the face" it usually is.

R.


Survivor (12/29/05; 15:27:38MT - usagold.com msg#: 139836)
Doesn't It Depend?

I surely like the sound of CBs such as China adding more gold to their reserves, but wouldn't the impact of those purchases depend on how they are accomplished?

If China goes out and bids up the market to aquire xx tons, then the additional demand should push $-prices up. If, however, China's CB simply becomes the purchaser when gold is offered by another CB at the current market $-price, then there would be little if any upward market pressure.

Naturally our collective gold-bull perspective suggests that when CBs even talk about purchasing, then it is assumed that other CBs will be less likely to sell, with resulting upward price pressure. This only plays out if there are in fact more buyers than sellers, though.

Not that there aren't plenty of other bullish reasons - all well articulated here - to buy and hold. And, if *all* CBs decide to increase gold reserves, then in the words of an esteemed knight: "To da moon, Alice!"

A happy new year to all! (And thanks to all who have constructive things to say about holding gold OR silver!)

- Survivor




PH in LA (12/29/05; 15:24:41MT - usagold.com msg#: 139835)
Year-end departures? Please reconsider!!
Rich Powell,

It would mark a sad day at USAgold to see you disappear from the list of posters welcome here. Before you leave, please keep the Crier's words in their usual abrasive context, and don't forget that he is a paid crier at best. His diligence in earning his salary often colors his comments to the point of giving offense. He (and his employers) would do well to remember that each time a poster is given more than ample opportunity to take offense, readers and potential customers get a negative impression, too.

Your voice is one that has long been greatly appreciated for its originalality around here. It is all-too-easy to re-post articles and opinions of other (often so-called) experts and much harder (but more appreciated) when truely personal ideas and opinions are expressed.

By the way, where is the crier's usual industry in expelling trolls like your admirer Flaccus when we truely need it?


968 (12/29/05; 15:17:50MT - usagold.com msg#: 139834)
Towncrier message #: 139832
If I may humbly add this to your superb post :

Because of these quarterly revalutions the Eurosystem was able to decrease its foreign exchange reserves from approximately 231 billion euros in 1999, to 161,2 billion euros this week.
This implies that the ECB's forexreserves exceeds their goldreserves by only 9% at the moment !!!!


TownCrier (12/29/05; 15:09:30MT - usagold.com msg#: 139833)
Paper goes *POOF!* -- Zimbabwe inflation tops 1,000 percent
http://story.irishsun.com/p.x/ct/9/id/da93f3b72012e4aa/cid/3a8a80d6f705f8cc/
29th December, 2005ÝÝ(UPI) -- The price of a loaf of bread rose by 1,157 percent during 2005, while milk climbed 1,718 percent, the nation's independent Consumer Council reported.

Meanwhile, unemployment has risen to 80 percent.

The upshot of explosive inflation and the highest unemployment rate in Africa is a proliferation of food scavenging.

About 70 percent of Zimbabwe's 12 million population manage one meal or less a day...

^---(from url)----^

This is simply one example in a billion in which an understanding of human nature will promply remind us that when a person has a meal to sell, and the would-be buyers are competing with goldmetal and inflated paper, the gold holder has the advantage over the paper holder.

Tragic as this example is, my point is made, and I'll refrain from lame attempts at any further pusuit of this issue by way of social commentary. Will simply conclude with an expression of my wishes for a better 2006.

R.


TownCrier (12/29/05; 14:50:20MT - usagold.com msg#: 139832)
Mark-to-Market day tomorrow
Tomorrow is the big MTM day for the eurosystem, reflecting not only the quarterly realignment of the reserve asset books as a nod to the generally-accepted pricing levels of the public market; it also provides the single annualized basis for reckoning of the revaluation accounts.

If gold overnight holds at its current level, each gold ounce in reserve will be valued near 435 euro.

This compares very favorably against this past quarter's mark of 393 euro per ounce, and very very favorably against the year-ago mark of 321 euro per ounce.

To all of the naysayers of the recent program of eurosystem gold activity ("selling"), the reality check is this... the naysayers have little grasp of the undercurrents at play and therefore remain unable to make correct interpretations between cause and effect in the overall dynamic of this particular market.

One simple observation should serve to put the naysayers on their back foot, and that is, even though the eurosystem has reallocated ("sold") approximately 500 tonnes in gold reserves during the past 12 months, the important fact of the matter is that the TOTAL MARKET VALUE of the fewer gold reserves that now remain IS HIGHER than the total value as was expressed "by the market" on the larger reserve holdings of one year ago.

TODAY:
EUR 435 x 377 million ounces (today's price and today's holdings) equals 164 billion euro

versus

ONE YEAR AGO
EUR 321 x 391 million ounces (last year's price and last year's holdings) equals 126 billion euro

The naysayers need to try harder to understand that they have it wrong. The price is rising NOT "despite" an apparent effort of the Europeans to quash it with sales, BUT RATHER the price is rising BECAUSE the Europeans have SET THIS INTO MOTION, some very deep foundational wheels, playing their own vital role in the current transition to a new international monetary system -- "new" as primarily distinguished by the gold-dominated nature and MTM accounting structure of the central banks' reserves.

Man's conception of 'best practice' has always evolved based on growing understanding of the tools available to him and the influence wrought upon the playing field. Discovery and acceptance of free-floating MTM gold reserves as the 'best practice' in the IMS is where the culmination of human financial history has brought us today. All that remains is the implementation phase, responsibly targeting a smoothest-possible transition.

Next month (January 2006) Russia takes the step toward MTM gold reserves, whereas legendary banking giant Switzerland is already on board.

Time and marches on. Will your papery portfolio withstand the rigors of change?

Call USAGOLD-Centennial for a diversification consultation and great prices on gold coins and bullion. TOLL FREE 1-800-869-5115

R.


R Powell (12/29/05; 14:48:11MT - usagold.com msg#: 139831)
TownCrier...protest?
Your 139823 protest (?) surprised me, to say the least. I made no comment or inference regarding anything at all....other than to make the statement that you often state that physical gold ownership is the safest form of ownership. I said that you often state this "belief", or that you believe such. Let us, please, not get into a semantic argument over the many connotations of the word "belief".

Your words....

"Whether you realize it or not, (and I'm thinking that you definitely do), your small comments like this one quoted above serve only to torpedo in the mind of the very casual reader the general merit of my contributions."

No, I did not realise it. It never crossed my mind. Nor do I hold any readers in such small esteem so as to think that implying "belief" in physical ownership would/could imply any doubt. Obviously there is no doubt in your mind. Are you implying that I should have said something to the effect of "foregone, unquestionable, deadly certain" rather than belief. Are you indeed an allknowing being? Should I add the words of TownCrier on my list of certainities...presently occupied by only death and taxes?

I'll say good-by to my friends here, and join the ranks of the missing (or thrown out) if you deem me an annoyance, but I'll not be lambasted over the connotation of "belief".
Regards
rich


Goldilox (12/29/05; 14:32:19MT - usagold.com msg#: 139830)
Protest noted, but
@ TC,

If it matters, I didn't read any of the negativity into Rich's statement that you seemed to.

Implied degradation is often difficult to discern over the internet, and my experience has been that I too often infer it from statements that weren't intended as such.

You do say that regularly, for reasons you fully support. No shame in that.

Just my $0.03, adjusted for inflation.


Belgian (12/29/05; 14:17:32MT - usagold.com msg#: 139829)
2006
With a frighthening conviction, the mainstream financial media don't see any sign of collapse for 2006. Indeed, they have it right. The stockmarket, bondmarket, housemarket nor the dollar will "collapse"...because...the helicopters stand ready to drop dollars, should something go (fall) the wrong way. (cfr. Allan's...CBs stand ready...)

The financial media (mouthpieces) are subtly reproducing this message on a daily basis.

Everything will be kept "$-inflated"...up until the bitter end. Goldphiles are supposed to know WHY it happens and WHAT exactly the bitter end means.

Keep watching that goldprice behavior with the multitude of gold statements ( WE WANT GOLDMETAL ) in the background.

Bear in mind that the ECB (and BIS) never architected the MTM OF GOLD_RESERVES against the *** $-paper-price *** of gold...BUT AGAINST GOLD'S VALUE IN A PHYSICAL MARKET !
Any contract ($-papergold) is a priori "WORTHLESS" if there is a certainty of *non-delivery* of the underlying !!!
During the past 7 decades, an ever declining mass of goldmetal demanding gold-bugs has been served with the available metal. The gold absorbing giants had to be extremely patient to pick some metal out of the market. Today, these same giants know that the existing $ paper gold market can deliver less and less of metal to satisfy their fast increasing gold demand capacity. FOR HOW LONG WILL THEY REMAIN DISCIPLINE...when the dollar now almost openly acts on Ben's helikopter statement ?

The ever rising amount of dollar-reserves cannot be compensated with a $-goldprice that is moved up and down with worthless paper contracts ! When the dollar-regime dictates the $-price of gold...goldmetal in CB vaults cannot function as a reserve, different from the dollar-unit reserves ! The world's dollar-reserve holders want gold as a WEALTH RESERVE and not as a dollar derivative.

THIS IS THE ONE AND ONLY REASON FOR HOLDING GOLDMETAL IN PRIVATE AND PUBLIC POSSESSION !!!

WHY inventing new gold-theories, day after day, when the complete plan becomes easier to understand ? Is holding goldmetal evolving to the globe's new wealth holding..."that" boring !?


USAGOLD Daily Market Report (12/29/05; 13:50:12MT - usagold.com msg#: 139828)
Page Update!
http://www.usagold.com/DailyQuotes.html
The Daily Gold Market Report has been updated.

If you are considering investments in gold we invite you to request our free introductory information packet detailing the products and services offered by USAGOLD ~ Centennial Precious Metals. We welcome your inquiry and look forward to working with you.

THURSDAY Market Excerpts

December 29 (from Reuters) -- Gold futures in New York rose but finished below a prior two-week high on Thursday, as late speculative buying helped offset producer selling during the morning in whippy, year-end trade.

February delivery gold was up $1.20 at $517.50 at the New York Mercantile Exchange's COMEX division, after gyrating around a range between $512.80 and $520.10.

The choppy session followed a rise to two-week highs in Tokyo gold futures and spot gold overnight fueled by upbeat sentiment on gold heading into next year, traders said.

"There's no volume because some dealers have sold at $520 and now don't want to do anything," one COMEX floor source said.

"Everyone does seem to be fairly positive looking into next year," said Bernard Hunter, a director at ScotiaMocatta in Toronto.

New York metals are set to close early near noon on Friday and remain shut on Monday for the New Year's market holiday.

One floor dealer said he was surprised by the 10.5 percent drop overnight in COMEX gold warehouse stocks.

Inventories fell 680,603 ounces to 6,497,818 ounces on Wednesday.

For the year, the price of COMEX gold is up 18 percent, as investors diversify into commodities from other assets and amid concerns about economic growth and geopolitical events.

Gold in the last six months also has broken free from its typical inverse relationship to the dollar, enabling factors like tight supply and strong demand to hold sway over prices.

---(see url for full news, 24-hr newswire, market quotes)---


USAGOLD / Centennial Precious Metals, Inc. (12/29/05; 12:50:29MT - usagold.com msg#: 139827)
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TownCrier (12/29/05; 12:26:21MT - usagold.com msg#: 139825)
Price of gold is expected to keep its momentum
http://www.iht.com/articles/2005/12/27/news/bxgold.php
(Bloomberg) NEW YORK -- With gold outperforming U.S. stocks and bonds this year, more investors are expected to favor it, turning around a recent price slide and bolstering it in 2006, according to a Bloomberg survey.

...Investors accounted for 14 percent of gold demand in 2004, up from 10 percent in 2003, according to the World Gold Council, a producer-financed group based in London. In the third quarter, investor demand for coins, bars and funds that buy bullion was up 56 percent from a year earlier.

...Gold may be favored by some fund managers over stocks and bonds because of concern that high energy prices will produce inflation and because the U.S. housing market may slow, sending the dollar's value lower in 2006, Goldman Sachs said.

...Still, gold is a long way away from previous highs. The price of $875 an ounce that it reached in 1980 would be equal to $2,050 an ounce in 2005 dollars, said Robert Sahr, a professor at Oregon State University who tracks the effect of inflation on gold and gasoline prices.

..."Gold is not overvalued at $500, and gold will not be overvalued at $1,500 or $2,000," said Peter Schiff, chief executive of Euro Pacific Capital, a brokerage firm in Darien, Connecticut.

Schiff, who said he had half of his money in gold and gold shares, added, "The real money is buying gold and putting it away."

[A gold ETF, on the other hand] represents one-tenth of an ounce of gold and allows mutual funds to invest in gold without actually owning the metal.

Dave Kuzmanich, a director in New York at RenCap Securities, a division of Renaissance Capital in Moscow: "More and more people are noting they have to be involved in gold."

^---(from url)---^

"The REAL money is buying gold and putting it away..."; a true form of savings (wealth consolidation) to be drawn upon during any future time of need, including, God forbid, any such circumstance where counterparties fall like dominoes and drifts of worthless paper burn in the streets.

As Alan Greenspan told Congress in 1999, "Gold still represents the ultimate form of payment in the world. Fiat money, in extremis, is accepted by nobody. Gold is always accepted."

R.


TownCrier (12/29/05; 12:13:23MT - usagold.com msg#: 139824)
Chinese economists urge expansion of gold reserve
http://metalsplace.com/metalsnews/?a=3486
29 December 2005, Mineweb

(a key excerpt)
The Chinese people's currency, the Renminbi (RMB), had been pegged to the U.S. dollar for years prior to the recent reform. A unit of the RMB is called the "yuan." Teng said global investors could benefit from buying Renminbi, but not Chinese investors, who, instead, must buy gold.

^---(from url)---^

Although other parts of the article are a hack job, it is refreshing to see a reference that a would-be saver, within his domestic currency area, "must" buy gold to accomplish his savings objectives (wealth consolidation).

Elsewhere, it is easy to object to the price portion of the article:

"China's Xinhua news agency reported this week that China's State Administration of Foreign Exchange is being urged by some economists to expand China's gold reserves. ... However, other economists argue that it is not a good time to buy gold because of high gold prices."

Do these other economists not acknowledge that "high price" is meaningless until the Dollar's depreciation (as the pricing unit) is factored into the assessment. At the Daily Market Report page there is an article (next to a gold-colored oil barrel) that expands on the relative cheapness of gold currently as compared to its historic "price" with respect to oil. Given the historic price ratio between gold and oil, and given the current oil price as an undeniable market commentary on the depreciation of the dollar, we can see that gold at $500 is indeed cheap as its historic ratio with respect to oil would suggest $1,000 per ounce is currently more appropriate.

Additionally, as I've been saying recently, the current price is very nearly meaningless is this respect bacause, without the cooperation of off-market arrangements with other central banks, there is no way that China could bid on 2,000 tonnes in the current "open" physical market without redefining the price (in a manner disruptive to the market) as a refection of the gold's value based upon this "new" use.

So as it stands, CB cooperation is indeed a necessary undercurrent to ensure, to the maximum extent possible, a NON-DISRUPTIVE price evolution as seen upon the open market. Not an easy task, given the order of magnitude of the inevitable revaluation.

R.


TownCrier (12/29/05; 11:27:51MT - usagold.com msg#: 139823)
Rich -- msg# 139821, I'm filing a protest
"TownCrier .... always commenting that he believes physical possession of gold is the safest (only advisable?) form of gold ownership?"

Whether you realize it or not, (and I'm thinking that you definitely do), your small comments like this one quoted above serve only to torpedo in the mind of the very casual reader the general merit of my contributions.

Breaking it down:

--- "...always commenting that he believes..."

First of all, I am "always commenting" because I am trying to help keep this discussion forum filled with gold-related news and insights as a service to Centennial's current and prospective clientele.

Secondly, mere "belief" (as in, "he believes") is a very cheap understatement of the topic at hand. To a casual reader, you are implying, with a sneer, that "he believes" in something like Santa Claus. The issues I have been stressing in my many posts are much more akin to 'two plus two equals four', and therefore your "he believes" sneer is inappropriate and unwelcome.

--- "physical possession of gold is the safest (only advisable?) form of gold ownership?"

Hello! If we are indeed talking about "gold ownership", OWNERSHIP mind you, (and, yes, we are talking about ownership), then you ought now to grasp my point about its self-evidence -- akin to "2+2=4".

Do you not know what "ownership" means???

But giving you the benefit of the doubt; if, in fact, "ownership" can be meant (interpreted) or had by different degrees, it still remains that no-one in their right mind could ever honestly suggest that any of a number of exotic derivative, promissory, or custodial arrangements could ever trump ACTUAL (physical) possession as the truest expression or manifestation of gold OWNERSHIP in question.

Think about it.

Randy


Goldilox (12/29/05; 10:27:19MT - usagold.com msg#: 139822)
Open mindedness
@ YGM,

I take no issue with your discussion of openmindedness, except that I think each of your resaons can be futher dissected into extrapolations of fear, about which most humans tend to be "borderline" rational.

An interesting quality about us as emotional beings is how difficult it is to balance our fears with a reasonable analysis of the outcomes.

As to your first statement: "What can one say about this type of mindset that refuses to admit they are wrong, have been wrong and their steadfast, stubborn, shortness of vision may be very costly to others financial well being over time?"

Not much more than one can say of the mindset of those who trust their financial well-being to those same visionless people.

Just because someone obtains an "education" and throws out a shingle, does not guarantee that they are wise. Knowledge is not wisdom, but simply the data required for thoughtful analyses. People with all the "right data" have been making poor choices based on their data since the beginning of time.


R Powell (12/29/05; 10:01:44MT - usagold.com msg#: 139821)
Sundeck
You mentioned that that Annenberg Foundation article had been linked here before. I must assess myself 18 demerits for having missed it in the past. In my system, this is a heavy penalty. I read nine pages before deciding to print it out as it is that good, so far.

The damnable thing about so many nonperishable commodities is that existing supplies, built up over many centuries, is an unknown + probably unknowable supply side number. Silver bulls like to point out that the approximately 6 billion ounces of silver that the US government held after WW2, is gone. This is known. But are there huge amounts of metal elsewhere in the world? Quite possibly. If these are made available to market demand will they keep prices low? I would say yes. This is pretty basic economics, I know.

The lack of transparency or lack of verifiable available existing supply is a two side sword. The silver market has not seen an inbalance of supply and demand, in my lifetime, that I'm aware of. The 1979-80 silver price run up was more speculative than supply/demand driven. On a yearly basis, useage has outweighed supply for years but...this begs the question of how much existing supply must be consumed before the market (price) reacts to this yearly deficit. Because of the lack of transparency of existing supply, I have no clue whatsoever. I doubt if anyone does. So the market continues to trade without any fear, at all, of a supply shortfall.

The other side of this two edged sword is that, because the market has never seen a shortfall and because it has no fear of one (indeed the very idea is always poohaha..ed), the potential for an incredible price spike is latently lurking. If/when it occurs, it will catch the market totally unawares. Even those who point out this potential are dismissed as fruitcakes, with any small silver price moves explained as sympathetic moves with gold. As always, just my opinions here.

But, back to my reason for posting, which was to say a million thanks for the link!!!! This is exactly the type of information that I seek. Although I'm only nine pages through it, I would say that it contains information or insight into much more than silver (which the authors concede is mentioned only as a means of supporting other conclusions).

Perhaps Flaccus would like to highlight the many passages that support the notion that there may be...may be.. still huge quantities of silver available in this world. I don't know if he dislikes me, silver or the idea that I opine that the POS will go up. Would he also disdain Scruffy for "BC..BN" or Aristotle for "Gold..get you some" or TownCrier for always commenting that he believes physical possession of gold is the safest (only advisable?) form of gold ownership? And what of Black Blades constant warnings that one should getout of debt, buy metals + store some of life's necessities. Are we all shameless promoters?

And to all, for the record, I do not recieve any compensation in any form from anyone for expressing my opinions here or anywhere else. (However, I will accept donations anytime if you care to send them!) I own NO stocks of any mining companies. I DO own a small stash of physical silver and I DO both buy and sell commodity options, silver included. My total investments in this world, in comparison to even a small market like silver, might be as comparable in size, as a peehole in the snow in a state like Alaska..yes, in the winter!

Thanks again, it is appreciated!
rich



YGM (12/29/05; 09:06:11MT - usagold.com msg#: 139820)
Sad To Say......A Closed Mind is Like a Closed Book.
The anti Gold rhetoric on ROB TV & financial writers by a rapidly declining few (less in numbers than a year ago) of the so called market timers and analysts is truly pathetic.
What can one say about this type of mindset that refuses to admit they are wrong, have been wrong and their steadfast, stubborn, shortness of vision may be very costly to others financial well being over time? "CLOSED MINDS" That's What!...........

An open mind is like a good sense of humor - everyone thinks they have one; however, that is not the case. Closed-minded individuals often just consider themselves "cautious", "decisive" or justify their non-acceptance of new ideas or beliefs in some other way. Here are a couple of the most common reasons why not everyone is open-minded.

Skepticism...Those who have experience in life certainly have had some negative experiences. They have seen that people do or say things for their own benefit and manipulate others. Skepticism is a self-defense mechanism that protects us from being taken advantage of, but it also prevents us from accepting new ideas. Trust in your own judgment and agree to consider other ideas and beliefs.

Stubbornness...Some people just cannot admit they are wrong. Out of pure stubbornness, they will refuse to accept or even listen to any new ideas. If you have an issue with admitting that you are "wrong", you can, instead, admit to not having all of the information. This is a more graceful way of saying you are wrong. :)

In too deep...Along the same lines as stubbornness, some people have lived their entire lives with a belief. By changing this belief, they would feel as if they have been "wrong" all this time. In fear of wasted days, months, or even years supporting an incorrect belief, these people would rather close their minds to other beliefs and ideas. Remember that it is never too late to do the right thing. Your journey down the right path begins by first getting off the wrong path.
An open mind will allow you to make better decisions in your life, while at the same time helping you to become a more understanding and sympathetic person. Lack of knowledge, or ignorance, on a subject can be avoided by having an open-minded attitude. You can choose to reject information, beliefs, or ideas after you have considered them, but not before you are even presented with them. Keep an open mind and let success find its way inside.



Clink! (12/29/05; 08:43:55MT - usagold.com msg#: 139819)
Maybe truer than you thought, Rich
In the spirit of furthering your, uhm, creative theory about gold:silver ratios, I would have to point out that most of the movies in question treat subjects with no real relation to the metal. So, just as with futures, shares, options, whatever, be very careful about basing your valuation - even relative valuation - on things that are precious in name only !!

C!


Goldilox (12/29/05; 08:29:24MT - usagold.com msg#: 139818)
Jump In US Consumer Confidence Does Little To Help Dollar
http://www.dailyfx.com/story/dailyfx_reports/daily_fundamentals/5782_jump_in_us_consumer_confidence_does_little_to.html
snip:

The dollar has been in a fairly tight range since the start of the holiday lull, but some action was seen at the end of the Tokyo trading session with the greenback rapidly losing value before settling into another range for the remainder of the morning. The December report of the Conference Board Consumer Confidence Index passed without a peep from the market. The index moved up to a higher-than-expected level of 103.6 from November's downwardly revised 98.3. The increase came mostly from a surge in consumers' assessments of the present situation while the expectations index garnered a small rise. After two strong monthly increases, the headline index now sits at its highest level since Hurricane Katrina struck in late August. Despite the optimistic overall outlook, perceptions of the labor market situation have not improved while even a smaller percentage of respondents reported expectations of income increases. Meanwhile, MBA mortgage applications fell to their lowest level in three years, showing a confirmation of the housing market decline. Though the past few months of data on building permits have continued to remain buoyant, it is now clear that demand isn't growing anymore. Although these reports amounted to a fairly positive morning, the rally seen in the dollar early in the afternoon was mostly due to the triggering of accumulated orders at a few key levels in dollar pairs. This type of market behavior is likely to continue until the end of the week as trading remains thin. Even though there are some US data releases tomorrow morning, barring any huge surprises, the numbers are not likely to create large moves.

Goldilox

Waiting for "the other shoe to drop?"


Goldilox (12/29/05; 08:19:16MT - usagold.com msg#: 139817)
Posting Tactics
@ Flaccus,

Interesting tactic, to accuse anyone who disagrees with your point of view of thread hijacking. It defocuses the reader from your lack of support arguments for about 2 seconds.

Not so interesting, the epithets and character assassinations, as they flaunt the Forum rules of decorum, and lower the discusion to the emotional level of an elementary school playground,

The posters you so flagrantly malign have been long time solid contributors of worthwile information, rendering your accusations specious, at best.

-G


Galearis (12/29/05; 07:25:52MT - usagold.com msg#: 139816)
@ Pritcho
Good morning,

I really like Wisconsin! A lot of that shield country looks just like Muskoka, Ontario- and for the same reasons.

What burned me was the postal service -- on the bullion which was an appropriate declared content item. I have (only) done this a couple of times and have been hit with tax once. It was a discouragement. However, it was also not appropriate to be taxed on this stuff,,,,but perhaps they aren't training the Canada Customs troops down there very well. I certainly wasn't going to protest loudly about it --for obvious reasons.

Coins should be all right. They can go in the category of collectibles -- private property. But then again,,,the mail route should have been trouble free too, yes?

Best regards,

G.

I might point out a curious development up here that can happen to individuals buying from a bullion bank. Modest purchases of bullion may be disallowed by the bank (this one a member of COMEX) if the source of the funds is not PROVEN to be a recognized bank account managed by the customer. Documentation is demanded for these purchases. Supposedly this is policy designed to thrwart money laundering - and a new one that is only a year old.

It also allows the bank to keep the metal on occasion.

It is always better to purchase metal from private dealers. Always!


Sundeck (12/29/05; 05:24:59MT - usagold.com msg#: 139815)
Cycles of silver
http://www.learner.org/channel/courses/worldhistory/support/reading_15_3.pdf
On the subject of silver, its historical importance and its price ratio to gold, it is worth ploughing through this essay by Flynn and Giraldez. It has been posted on this forum several times in the past, but is still the best historical account covering the several hundred years post-Potosi with which I am aware.


Dennis O. Flynn and Arturo Gir·ldez, "Cycles of Silver: Global Economic
Unity through the Mid-Eighteenth Century," Journal of World History 13, no. 2
(Fall 2002): 391--427.



Happy browsing and reflecting!

:-)


Caradoc (12/29/05; 05:05:53MT - usagold.com msg#: 139814)
@Invisible Hand
Great post!

You've pointed out the handwriting that's on the wall. To whatever extent investors in general heed the warning, the odds go up that we're only days/weeks from the collapse of the dollar. True, the broad range of investors still can't see further than deciding which stock or mutual fund to go with, but by now they must be aware that noises are being made in "respectable" places about having 5% of portfolio in gold. Yeah, they'll be thinking the GLD ETF and three or four top gold stocks rather than coins stored in a cigar box, but even so all it would take for POG to break past previous all time high is 1% of the Joe Sixpacks of the world trying to put 5% of their assets into gold in any form.

My personal hunch is that -- since markets do anticipate -- Iran trading oil for Euros rather than dollars in March of 2006 marks the date by which the dollar will have already tanked. The fun part is thinking about what date in January or February.

Just how I see it....

Caradoc


Caradoc (12/29/05; 04:12:29MT - usagold.com msg#: 139813)
@Flaccus
Please give it a rest. I've rarely (maybe never before?) responded to ad hominem posts on this forum, but your ongoing posts against those interested in silver is becoming tiresome while using up valuable bandwidth.

Like Donne's metaphor of Christianity as a tree big enough to host flocks of various sorts of birds, this forum has traditionally included every stripe of precious metal advocate from those who advocate physical only (Au, Ag, or both) to those like me who recognize that eventually "all paper will burn" but in the meanwhile don't mind dealing in the world of paper -- or even options for paper! -- as a means to acquire the greenbacks that fund our stashes of the real thing. Further, the interplay among this broad range of participants is what makes this forum valuable.

If you'd like a narrower forum, there're out there and available to you.

Enough said?

Caradoc


Flaccus (12/29/05; 03:09:04MT - usagold.com msg#: 139812)
Rich Galearis
Nice tag team.

Hijackers.

Johnny one notes.

Shameless, boring promoters.

It's all staged

YGM - Surprised you're not offended. Their never ending infomercial an obvious abuse of this forum. Wish management would do something. They think we are too thick to see through it. That last ditty from Galearis was predictable. A set up by Rich Powell.


The Invisible Hand (12/29/05; 02:43:29MT - usagold.com msg#: 139811)
Doomsday for the Greenback
http://www.uruknet.info/?p=m19060&l=i&size=1&hd=0
December 28, 2005
SNIPS
A preemptive attack on Iran would provoke other industrial nations to strategically abandon the dollar en mass - in an effort to thwart the neoconservatives from pursuing their desperate strategy of dominating the world's hydrocarbon energy supply.
+
Hugo Chavez knows this, as did Saddam; that's why he switched to the euro 6 months before "Shock and Awe". Now, Putin is trading oil in euros and Iran will open an oil bourse in petro-euros in March. For Iran, its actions are tantamount to a declaration of war. Already, America's proxy Israel has threatened to attack in March. Is it mere coincidence that that is the same month Iran's oil bourse is scheduled to open?
+
In essence, the US will no longer be able to effortlessly expand credit via US Treasury Bills, and the dollars demand-liquidity will quickly fall. This will challenge the hegemony currently enjoyed by the financial centers in both London and New York.
In other words; doomsday.


TownCrier (12/29/05; 01:30:19MT - usagold.com msg#: 139810)
Gold Near Two-Week High on Speculation Central Banks May Buy
http://www.bloomberg.com/apps/news?pid=10000081&sid=a910yhqw8SIo&refer=australia
Dec. 29 (Bloomberg) -- Gold traded near its highest level in two weeks on speculation central banks, the biggest holders of the metal, may buy more bullion to diversify their reserves.

The precious metal has risen 4.9 percent in the last seven days...

Increasing gold reserves to 2,500 tons would make China the world's fifth-biggest holder of gold, behind the U.S., Germany, the International Monetary Fund and France. It is now the 10th- largest holder, the producer-funded World Gold Council says.

Russia's central bank said in November it may double its gold reserves. South Africa and Argentina have also said they may increase holdings. Central banks, mainly in the U.S. and Europe, hold almost a fifth of the world's gold supply as a reserve asset.

^---(from url)---^

The news is making the rounds as monetary policymakers strive to play the right public notes to achieve social legitimacy as necessary underpinnings of the goldprice evolution that is currently underway.

That might seem oddly cryptic to a paper trader, but I'm sure the metal owners will have no trouble 'catching my drift', so to speak.

R.


TownCrier (12/29/05; 01:17:31MT - usagold.com msg#: 139809)
Gold jumps on talk of China buying
http://www.theglobeandmail.com/servlet/story/RTGAM.20051228.wgoldd1228/BNStory/Business/
(From Thursday's Globe and Mail) -- Speculation that the Chinese government might start buying gold to bolster its reserves helped drive up its price more than $6 (U.S.) an ounce Wednesday.

The jump was prompted, in part, by a suggestion that China should increase its gold holdings from 600 tonnes to 2,500 tonnes in the short term and up to 3,000 tonnes in the long term.

...analysts have been watching central banks to see how they react. Central banks have been a key factor in gold prices for years. They currently hold nearly one-fifth of the world's supply, roughly 31,000 tonnes.

...in recent months, as gold prices have jumped, many central banks have held off on sales and some banks have suggested that they may start buying gold.

At a world gold conference last November, officials from Russia indicated that the country plans to double its reserves, which currently stand at about 500 tonnes.

Argentina and South Africa also indicated that they may start buying gold.

...even a slowdown in sales by central banks will affect the market.

"If you take a longer-term perspective, it's quite feasible at some point they will look to diversify out of the dollar," Philip Klapwijk, chairman of British-based consultancy GFMS Ltd., told a recent conference. He has indicated that Venezuela and Iran could also be gold buyers.

But the biggest move yet could come from China. Economist and government leaders have been debating for weeks whether the country should buy gold in the wake of its decision last July to appreciate the yuan, which had been pegged to the U.S. dollar.

Buying gold is seen by many Chinese economists as a way of diversifying state reserves. However, the government has not yet said what it will do.

^---(from url)---^

Many here will rightly regard this as a rehash of old news, but that only goes to show you how far ahead of the power curve our readers are than those who wait to get their gold news parcelled out by major mainstream outlets such as seen here in The Globe and Mail (no disrespect intended).

R.




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