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ARCHIVED DISCUSSION FROM 8/30/2000 All times are U.S. Mountain Time (Yesterday's Discussion.) ET (08/30/00; 23:18:50MT - usagold.com msg#: 35766) Joe Stromberg http://www.antiwar.com/stromberg/s082900.html From the article;"But the real core of bureaucracy was none of the above-named trends. No, "the idea of bureaucracy is not fulfilled till we add the pedantic element of a pretence to direct our life, to know what is best for us, to measure out our labour, to superintend our studies, to prescribe our opinions, to make itself answerable for us, to put us to bed, tuck us up, put on our nightcap, and administer our gruel" [my emphasis]. This can only arise, says Simpson, in a state whose rulers believe they understand everything important about human existence. In 20th-century America, this requirement has long since been fulfilled. Our leaders and nannies do indeed have a world-outlook, a philosophy, and ideology. It is pretty much the "Wisconsin Idea" writ large and will be the 21st century's task to overthrow it, if we are to have any lives and civilization at all. "I call as my second witness - we believe in balance around here - the great French liberal Alexis de Tocqueville. In the last chapters of Democracy in America, he writes that the social equality enjoyed by the Americans may be preparing them for a new form of despotism. Under such a system, the benevolent state - harmless because, after all, the people ultimately rule by voting - "provides for [the people's] security, foresees and supplies their necessities, facilitates their pleasures, manages their principal concerns, directs their industry, makes rules for their testaments, and divides their inheritances. Why should it not entirely relieve them from the trouble of thinking and all the cares of living?" Writing in the 1830s, Tocqueville might not have guessed that it would be precisely state-run schools that would relieve Americans from the burden of thinking." ET (08/30/00; 22:45:54MT - usagold.com msg#: 35765) Joe Sobran http://www.lewrockwell.com/sobran/sobran88.html From the article;"I've often marveled that modern man has more faith in the State than medieval man had in the Church. Though the State's utopian promises have been kept by fraud at best, and war and mass murder at worst, its authority has hardly been impaired by experience - probably because it has taken charge of education and erased its subjects' memory of its own crimes. "All political discussion, you'd think, should naturally begin with a haunted awareness of two world wars, the Gulag, forced famine, genocide, the bombing of cities, nuclear weapons, that sort of thing; not to mention the State's enormous and ever-expanding parasitic economy of dependency, debt, and funny money. But evil has a way of inuring us to itself; having supped full with horrors, we cease to be horrified. In time the horrible seems normal, and we live contentedly with things our ancestors would have crossed oceans to escape." Voyager (8/30/2000; 22:38:49MT - usagold.com msg#: 35764) RS & Hi-Hat I would have to agree that Atlas Shrugged has awakened a new insight and understanding for me into the mind of men. It is not a very positive view. I ended reading tonight at the end of Hank Rearden's trial. Rearden is thinking, "Why were they ready to renounce their highest moments as a sin? Why were they willing to betray the best within them? What made them believe that this earth was a realm of evil where despair was their natural fate? He could not name the reason, but he knew that it had to be named. He felt it as a huge question mark within the court-room, which it was now his duty to answer. This was the real sentence imposed upon him, he thought - to discover what idea, what simple idea available to the simplest man, had made mankind accept the doctrines that led it to self-destruction". Chris Powell (8/30/2000; 22:22:31MT - usagold.com msg#: 35763) Germany's leading newspaper reports on gold manipulation http://www.egroups.com/message/gata/517 Two articles about GATA in one week inthe Frankfurter Allgemeine Zeitung, whichis close to Bundesbank sources. Somethingwell may be up....To subscribe to GATA's dispatches by email and get them immediately so you don't have to go look for them, send an email to:gata-subscribe@eGroups.com Gandalf the White (8/30/2000; 22:16:34MT - usagold.com msg#: 35762) Strad Master's Sunday Concert The Hobbits had cleaned off the Gramophone and connected the PC to it and tuned into Mt. Wilson FM to test the quality of the sound. ALL set to go for Sunday eve at 6pm. BREAK A LEG !!<;-) JMB (8/30/2000; 20:48:10MT - usagold.com msg#: 35761) FARFEL I'm hearing rumors of FARFEL activity in Hollywood. Very disturbing activity. His confirmation or denial would settle the matter. As self appointed President of 'The FARFEL Fan Club' it is my duty to encourage The Great Man to make occasional public appearances least his persona diminish in the eyes of his loyal following. -------hint: regarding rumor...seedy movies------Sir FARFEL: You have until NOON Saturday to clear your good name or I will be forced to reveal the rumor. Please FARFEL, I beg you, tell us what's happening! Canuck (8/30/2000; 19:49:41MT - usagold.com msg#: 35760) Now a shot at GFMS about silver inventories. http://www.gold-eagle.com/editorials_00/kenrock082900.html The author questions silver inventories presented by Gold Field Mineral Services.This follows R.Howe and GATA's questioning of gold 'shorts'by GFMS. 714 (8/30/2000; 19:49:07MT - usagold.com msg#: 35759) Fleckenstein on silver.... http://www.siliconinvestor.com/insight/contrarian/ "Silver has been under a good deal of pressure for many, many months now, and folks close to the market haven't quite understood why. There were stories of Chinese selling, there were stories of Barrick Gold (ABX) starting a silver hedging program to go along with its hedges in gold (silver is a large by-product at one of Barrick's new mines). But the real reason, according to folks close to the market (and I agree with them), is that Warren Buffett has been selling his silver position. These same folks -- in whom I have a great deal of confidence -- believe that there's a high probability he might be done. This is pure detective work because I don't think we'll ever know officially, so I want people to know this is conjecture, however informed, on my part and the part of people I know close to the market." aunuggets (8/30/2000; 17:52:46MT - usagold.com msg#: 35758) test test schippi (8/30/2000; 17:39:13MT - usagold.com msg#: 35757) Select Gold Wavelet Chart http://www.SelectSectors.com/wavelet.gif Wavelet chart is a little hard to read, but if you score it near the end of data, one component at a time, I find it reads the bottom is behind us, and poised to move Up. HI - HAT (8/30/2000; 16:41:24MT - usagold.com msg#: 35756) Voyager_______Atlas Shrugged Truly, the Objective, razor sharp, mind remains, everthe first weapon of choice. I envy your insights and "experiance", gained in a first read of this book.MONUMENTAL. Human nature really does not ever change. RS (8/30/2000; 16:12:32MT - usagold.com msg#: 35755) re: Voyager (8/30/2000; 13:14:44MT - usagold.com msg#: 35746 "Atlas Shrugged" Sir Voyager:If you enjoy "Atlas Shrugged", be sure to also read Ms. Rand's earlier work, "The Fountainhead".There was a movie made in the 1940's (?) of "The Fountainhead", with Gary Cooper and Patricia O'Neal in the lead roles. I've never seen the movie, but I recently re-read the book for perhaps the 10th time.Both books have always been very important to me, and I will always be gratefull to the gentleman who recomended them to me in my formative years.(It's well known to many here that Mr. Greenspan of the Federal Reserve Bank was once a friend and confidant to Ms. Rand!)___________________________________________"... gold is good." - ANOTHER (THOUGHTS!) circa Feb 04, 1998 714 (8/30/2000; 16:01:40MT - usagold.com msg#: 35754) Aristotle... ...I didn't know this was a Dollar Forum, too. I'll try to add more on that subject. :)Watch the dollar. When it falls, gold will rise.As for perspective, we each bring our views and experiences to bear here (or at least I hope we do). I've always enjoyed your posts and have saved a few over the last 2 or 3 years. Yes, I am a long-time lurker here, recently having come out of the woodwork. I find no fault with gold. I find fault with markets. And these markets (and more) highlight the worst of all human weaknesses...credulity. I was raised to verify what I heard and read, and to think for myself. I am not an idealist. I am a realist. Although I may not share some popular views here, I do share other views. And gold is a good hedge, yes?Yes, indeed. Gold. Get you some.... Goldfly (8/30/2000; 15:29:11MT - usagold.com msg#: 35753) Strad.... http://www.armstrongdefensefund.org/ I'll be listening Sunday! Strad Master (8/30/2000; 15:07:56MT - usagold.com msg#: 35752) Martin Armstrong: Wherefore art thou? I've got a question about Martin Armstrong: WHAT ever happened to him? Last I heard he had been arrested and was being led off to jail, all the while threatening to spill the beans to GATA on all the skeletons in everyone's closet. Then nothing. Poof! It's as if he vanished down a black hole. Was he bailed out and is now awaiting trial? Did they set bail so high that he couldn't get out and is now languishing in solitary confinement? (Unless one is a serial murderer it is usually possible to get out of jail on bail, isn't it?) It wasn't that long ago so there can't have been a trial, yet. If there had been, wouldn't there have been some news about it somewhere? Even GATA hasn't said anything. It all seems too mysterious to me. Maybe I'm just out of it so if anyone knows what's up, please let me in on it. Aristotle (8/30/2000; 14:57:15MT - usagold.com msg#: 35751) Question for 714 I've been enjoying your input to the forum, and was hoping you could help me out on an issue of perspective. You said, quite fairly, the following:-------------------------------------"What bothers me most is that investors just aren't interested in gold."But derivatives are not, IMHO, the real problem with gold, although they do exaggerate the price."The basic problem with gold is supply and demand. With so much of it having been mined in the last twenty years (about 40% of the world's above ground supply) and CB selling, there's plenty of it out there, even for the shorts."--------------------------------------Why did you focus on the small potatoes when you could have described the whole farm? Like this--............."What bothers me most is that investors just aren't interested in dollars."... But derivatives are not, IMHO, the real problem with dollars, although they do exaggerate the price."The basic problem with dollars is supply and demand. With so much of it having been borrowed in the last twenty years (about XX% of the world's total supply) and CB lending, there's plenty of it out there, even for the shorts."..........I'm simply curious why it is that so many people seem to find easy fault with Gold when there is a parallel and gaping chasm with regard to the dollar that goes unnoticed or unsaid. I'm just asking.Gold. Get you some. ---Aristotle Strad Master (8/30/2000; 14:49:28MT - usagold.com msg#: 35750) Trail Guide http://www.KKGOFM.com/playlist&kmozart%20live.htm A while ago you and I had a very nice discussion about Stradivarius violins and gold. Because of that, I thought I'd play my Strad this Sunday on the concert so you and everyone here who tunes in via the net can hear it. Just in case you missed my previous postings, I am going to play a concert this Sunday (September 3) at 6 PM (Pacific Time - so you'll have to account for your own time zone) that will be broadcast on our local radio station KMZT (105.1 FM) and live over the net at the above web address. Hope you can listen in. It will certainly be a pleasant diversion from thinking about the POG. JMB (8/30/2000; 14:23:38MT - usagold.com msg#: 35749) The CRB is an animal! Looks like it's heading for the wild blue yonder.Bobbo: You got something against the Doors? I'm hoping Mr. Doe will resurrect Jim Morrison...with your approval. I miss your act at Kitco...bad break, wasn't your fault. It's good to see you here. Strad Master (8/30/2000; 14:21:42MT - usagold.com msg#: 35748) Test Test Bobbo (8/30/2000; 13:26:40MT - usagold.com msg#: 35747) Good News for Gbugs.... Gbugs get ready there's a rally coming. May even see a gap up tomorrow, buy dips (if we see any now), but whatever you do BE NET LONG the yeller. DON'T be caught short.Btw...loved those Beatle's song updates...:) Voyager (8/30/2000; 13:14:44MT - usagold.com msg#: 35746) (No Subject) Black Blade: Thanks for good humor on clinton's trip to Nigeria and the Chelsea for oil scandal (now known as Chelsea Gate). While it seems impossible, what makes humor great is the quality of truth behind it. We all know clinton would do anything to obtain his objectives or make himself look good.I recently returned from three weeks of boating to the West Coast of Vancouver Island. No newspaper, TV, radio, or Internet, but lots of crabs, salmon, and prawns. Also whales, bears, eagles, etc.Anyway, before we left I ordered Atlas Shrugged from Barnes & Noble based on the comments read here. I had no idea of the scope or story line of the novel. Am only about half through the book, but all I can say is: "WOW". I have no idea how this will end, but so far, I have never read such a book on social commentary. The story line seems to timeless in modern history as it describes the USA today better than anything else. I have long since thought that socialism and liberalism were dangerous and evil and against our Constitution. The really frightening part is the parallels of what is being done in the name of the "children and the social good" in the book and what is being done today. Also, the energy problems of oil and the current price hikes and potential shortages. If anything in our schools should be required reading, this would be it. Am very curious how this will end, but don't give any hints. Aristotle (8/30/2000; 11:59:05MT - usagold.com msg#: 35745) Reality in the Information Age--Finding Gold's Role Let's face it. We live in what has been hailed the Information Age. The distinction is likely not because we are the first of the "Ages" to make use of information, after all, it is distinctly mankind's ability to make decisions basedn on accumulated knowledge and information that clearly sets us apart from our fellow creatures. Likely, the designation is owing to the ponderous degree to which civilization has become reliant upon this same precious information that has certainly helped it to advance.Like Nothing Before ItWhile not a tangilble component of our tools as was the stone, iron, and bronze in earlier Ages, or like the factories of the Industrial Age, our use of information is now certainly no less vital in shaping and defining the present age of civilization. Our convenient use of information -- whether it be a blueprint, a database of scientific measurements, quarterly corporate financial reports, weather forecasts, marketing surveys, or the latest international political and economic news -- is so entrenched in the course of our decision-filled lives that we would be hobbled without it.Safety NetsWhile a majority of people entrust the source, development, delivery, and safe stortage of most vital information to others, generally, only those fewer people who develop information, particularly for their livelihood, fully appreciate the importance of safe storage for that data. Making backups of computer files is an absolute requirement that no self-respecting programmer or data manager would neglect--perhaps two separate files on the same disc, and a third copy stored elsewhere on a different medium.Dragons vs. Lifetime AcheivementBut good examples don't stop there. Just think of our "Author of the Millennium," J.R.R. Tolkien. After putting mor than a decade into developing the manuscript for his masterpiece, "The Lord of the Rings," you can be almost certain that ensuring the safety of this life's work--over one thousand pages of ink on paper--occupied much more than a passing thought, and probably was the germ of several fitful nights' sleep as a helpless dreamer's pages were charred in the dragon's fire. Or in another example, just imagine how paranoid a student becomes as he nears completion of his doctoral thesis--the culmination of over two decades of schooling. You can be sure that the Ph.D. candidate makes more hardcopies and more backup files than with any other project in his life, simple because it is so important and represents his life's work thus far.Standing in Their ShoesTo come to my point, this background was to demonstrate for the many what is already very clear in the eyes of the few -- that it is particularly vital to backup or otherwise safely store information which represents your life's work. And more to my point, this discussion about information was appropriate here if you consider the answer to this basic question: What is the foundation of our modern dollar and of all other modern currencies of the world? They are all nothing except pure INFORMATION!So while most of us might complacently think that we have no life's work of information to fuss over and safeguard like the programmers, the Tolkiens, or the PhD's of the world; in truth, if we have accumulated currency in the course of our careers, then we are standing in their shoes. We have a lifetime's effort of accumulated "monetary information" to safeguard, or else we have something to lose. You might think, "No problem. I'll let my bank worry about backing up and safeguarding the quantity of information setting in my account." Well, it's not that simple, and it doesn't end with the simple preservation of the "numbers" that belong to you.Be Rumpelstiltskin; Spin Your Straw Into GoldThe aspect that is most troubling to someone who is mindful about safeguarding the information which represents his life's earnings is that our currencies are not the constant and ever-useful sort of information such as the speed of light, the freezing point of water, or the number of miles between here and there. Instead, our currency is the sort of information that is more akin to weather forecasts built upon meteorological data. Sometimes you end up getting wet and blown away even when the forecast called for blue sky.Can you imagine writing your epic manuscript on a kind of paper that has a tendency to spontaneously combust; or knowingly saving your thesis on a disc containing a reformat virus? That's exactly what you are doing when you store your life's earnings and economic gains in the form of dollar-denominated accounts. Even if you split your accounts among many banks and investment funds, you've only essentially managed to make several backup files all saved on the same faulty disc, and planned several picnics for the same day. Where do you sit when the forecast calls for blue sky, but Mother Nature called for rain?Exchanging dollars for physical Gold routinely on the sunny days is the wise man's most prudent, secure, and comforting method of tangibly safeguarding something that represents of his life's accumulated efforts in this modern age. Otherwise, he would have only the delicate and wayward information which "exists" as currency to serve as the culmination of his past effort and to assist him in making all future economic decisions. You will surely agree that $350,000 may be good and useful information to "own" today, but there is no guarantee that $350,000 will still be as good and useful in future days. Gold, on the hand, is rock-solid "information."Gold. Because the forecast never calls for dragons, but the fire and storms still may come in many forms. ---Aristotle 714 (8/30/2000; 11:25:12MT - usagold.com msg#: 35744) goldfan... ...there is no shortage of gold precisely because CBs are selling their inventories into the market. If they weren't, the price would go up and sales of jewelry, which comprise a whopping 85% of gold consumption according to WGC, would fall. What bothers me most is that investors just aren't interested in gold.I take no issue that a crunch will fall upon us at some point. A dollar devaluation is gold's brightest hope. It WILL happen. And it will wreak havoc in the derivatives markets, even if they are settled in cash instead of gold. But derivatives are not, IMHO, the real problem with gold, although they do exagerrate the price.The basic problem with gold is supply and demand. With so much of it having been mined in the last twenty years (about 40% of the world's above ground supply) and CB selling, there's plenty of it out there, even for the shorts. When the US$ weakens, it'll go up, maybe way up, and it is a great hedge for that day. wolavka (8/30/2000; 10:48:41MT - usagold.com msg#: 35743) time closing for gold should see some short covering before big week end, 3-5.00 pop. John Doe (8/30/2000; 10:39:58MT - usagold.com msg#: 35742) Bonedaddy, JMB Thanks, just adding to another day in the life of the USA Gold Forum. It's getting better all the time! ;o) Black Blade (8/30/2000; 8:41:55MT - usagold.com msg#: 35741) Weekend Reading Assignment a Bit Early (since it is a slow day!) Could it happen again? The German Currency Crisis of 1922-24Brian Trumbore President/Editor, StocksandNews.comThe new European Central Bank has set an inflation target of 2% for its member nations. And, with inflation currently running at 1.9%, the ECB recently raised interest rates significantly in an effort to slow the pace of growth in the Euro economies, even though some say the growth is far from robust. And then I saw where new Russian President Vladimir Putin was recently in Germany, Russia's largest creditor, to seek debt relief. Finally, there have been rumblings of another currency crisis, possibly starting in Asia, just as in 1997.Put it all together and there is only one thing to do. Take a look at the fall of the deutsche (or German) mark during the period from 1922-24! It is truly amazing. But to understand this story, one has to take a quick look back at the aftermath of World War I. At the end of the war, Germany was crushed; Britain and France exhausted winners. And there were a lot of common questions, such as, would revolution in Russia spread to the rest of Europe? Would Britain and France recover? Would Germany attempt a war of revenge?Enter the Treaty of Versailles, June 1919. The treaty stated that Germany was responsible for the outbreak of war and France, in particular, demanded that Germany pay in more ways than one. The German military was reduced to a shell of 100,000 volunteers and about 6 cruisers and the German government had to pay reparations of some 132 billion marks, as well as other payments such as one fourth of all extracted coal. French Prime Minister Clemenceau said, "We will squeeze the German lemon 'til the pip squeaks." Britain, which hadn't suffered the physical damage that nations like France and Belgium had (though, obviously, had paid a heavy price in human capital) wanted to restore the fledgling German Republic to reasonable economic strength. In view of the perceived threat posed by the Russian Revolution, Germany could be a force for European stability. But the French position largely won out and Versailles was a total humiliation for the Germans. Having to admit responsibility for the outbreak of the war, or the "War Guilt Clause," was especially trying. Henry Kissinger comments:"18th century peacemakers would have regarded 'war guilt clauses' as absurd. For them, wars were amoral inevitabilities caused by clashing interests. In the treaties that concluded 18th century wars, the losers paid a price without its being justified on moral grounds. But for (U.S. President) Wilson and the peacemakers at Versailles, the cause of the war of 1914-1918 had to be ascribed to some evil which had to be punished."Germany had to surrender 13% of its prewar territory. The key industrial sector of Upper Silesia was turned over to a newly created Poland. Germany also lost Alsace-Lorraine to France and the Rhineland was demilitarized. And Germany was forced to pay for pensions of war victims and some compensation for their families, an unheard of provision. Economists warned of the implications but the populations of the victors wanted revenge. [An opposing viewpoint to all this is supplied by noted author William Shirer. In his view, Versailles left Germany geographically and economically largely intact and preserved her political unity and her potential strength as a great nation.]So Germany was reduced to economic chaos after the armistice. In 1920, prices plummeted around the world in a great deflation. Both price and wage deflation were reinforced by the economic policies of conservative governments. Germany's new Weimar Republic inherited the vast burden of debt and the crushing weight of reparations. In Germany, tax revenues were low because the economy was so weak and outflow of payments in gold fueled inflation as the government began to sell inflated currency for gold on the foreign exchange market. And it quickly became apparent that Germany would be unable to meet its reparation obligations. In July 1920 the German mark plunged dramatically as the Weimar government informed the Allies that it could not meet the schedule of payments, but that it would continue disbursements of coal and other natural resources. With the U.S. pressuring Britain and France to repay their own war debts, the Allies grew all the more determined that Germany pay up. France's new premier, Raymond Poincare, accused Germany of deliberately withholding payments and trying to force the Allies to make concessions by ruining its own currency. On January 11, 1923, French and Belgian troops (against the advice of the British) occupied the Ruhr, a region which furnished four-fifths of Germany's coal and steel production. The miners refused to work for the enemy and the Germans simply printed more money with which to pay them not to, allowing inflation to spiral completely out of control. The economy was strangled and the free fall in the mark was incredible. Following is the historic slide.July 1914 4.2 marks to the dollarJanuary 1919 8.9July 1919 14.0January 1920 64.8July 1920 39.5January 1921 64.9July 1921 76.7January 1922 191.8July 1922 493.2January 1923 17,972.0July 1923 353,412.0August 1923 4,620,455.0September 1923 98,860,000.0October 1923 25,260,208,000.0November 15, 1923 4,200,000,000,000.0 …yes, trillion.[Source: Gordon Craig, "Germany 1866-1945"]By late 1923, the German government required 1,783 printing presses, running around the clock, to print money. Germans wheeled shopping carts filled with literally trillions of marks to pay for a single loaf of bread. Employees asked to be paid their wages each morning so that they could shop at noon before merchants posted the afternoon price rises. [I often eat lunch at 11:30 these days so I would have received a better deal.]The New York Times ran a story on October 30, 1923, datelined Berlin, which told the tale of an American who went into a restaurant and handed the waiter a dollar, asking for "all the food an American dollar will buy." The waiter recovered from his astonishment and began to serve the guest."Soup, several meat dishes, fruit and coffee were served. While the guest was smoking his cigar the waiter brought another plate of soup, and later another meat dish. "'What does this mean?'" the astonished and satisfied guest asked. "The waiter bowed politely and replied: 'The dollar has gone up again.'"Spiraling inflation wiped out people with fixed incomes and small savings they had put aside for retirement. The bonds, which had been sold to finance the war effort, were worthless. The faith of the people in the economic structure of German society was destroyed. Author William Shirer remarks:"What good were the standards and practices of such a society, which encouraged savings and investment and solemnly promised a safe return from them and then defaulted? Was this not a fraud upon the people? "Some say that the inflation could have been halted by balancing the budget, hard as that may have been given the crushing debt loads. But the cost of the war - 164 billion marks - had been met not even in part by direct taxation but 93 billion by war loans, 29 billion out of Treasury bills and the rest by increasing the issuance of paper money. But not everyone suffered in Germany. Again, Shirer:"Big industrialists and landlords goaded the government to deliberately let the mark tumble in order to free the State of its public debts, to escape from paying reparations and to sabotage the French in the Ruhr. The destruction of the currency enabled German heavy industry to wipe out its indebtedness by refunding its obligations in worthless marks. The fall of the mark wiped out war debts and thus left Germany financially unencumbered for a new war. The masses of the people only knew that a large bank account could not buy a straggly bunch of carrots, a few ounces of sugar. In their misery the Republic was made the scapegoat for all that had happened."Finally, in 1924 German inflation was brought to a sudden end and a Chicago banker, Charles Dawes, played a huge role. Dawes was the chief architect behind, guess what, the Dawes Plan which left the Reichsbank partially under the direction of an American commissioner who was to oversee German reparation payments. It did not lower the amount Germany was expected to pay. In turn the U.S. reduced the debt obligations of its Allies by 30-80%. The plan helped improve relations between the Allies and Germany and, for this, Dawes earned a share of the 1925 Nobel Peace Prize (the other recipient being Sir Austen Chamberlain of Britain).But the Dawes Plan wasn't without cost. The banking consortium Charles put together reaped 10% of the face value for underwriting costs, the motto being, "business, not politics. "Over the next 5 years, Germany paid out about $1 billion in reparations and received loans of about $2 billion, a sizable portion from the U.S. In effect, America was paying Germany's reparations, while Germany used the surplus from America to modernize its industry. Reparations, then, did not necessarily ruin the economy, but their psychological impact in Germany did a number on the people and damaged the very republic the vast majority of the Allied population wanted to succeed. Confidence in open, democratic institutions was weakened fatally in central Europe. At the height of the currency crisis an interested spectator commented:"The government calmly goes on printing these scraps of paper because, if it stopped, that would be the end of the government. Because once the printing presses stopped - and that is the prerequisite for the stabilization of the mark - the swindle would at once be brought to light. Believe me, our misery will increase. The scoundrel will get by. The reason: because the State itself has become the biggest swindler and crook. A robbers' state!…If the horrified people notice that they can starve on billions, they must arrive at this conclusion: we will no longer submit to a State which is built on the swindling idea of the majority. We want a dictatorship." So said Adolph Hitler. Sources: "Diplomacy," Henry Kissinger"The Rise and Fall of the Third Reich," William Shirer"Twentieth Century," J.M. Roberts"A History of Modern Europe," John Merriman"The Great Wave," David Hackett Fischer"Wall Street: A History," Charles Geisst"The New York Times Century of Business,"Floyd Norris and Christine BockelmannBrian Trumbore USAGOLD (8/30/2000; 8:28:31MT - usagold.com msg#: 35740) Quiet Today DAILY COMMENTARY (8/30/00) www.USAGOLD.com . . . Gold continued to rattle around the $273 mark trying to figure out what to do next as we traverse the last few sessions of the summer doldrums. The European market was described as very quiet overnight with one trader saying he thought the yellow would stay in a tight range from $272 to $275. Asian trading was quiet and featureless. To be noted: The euro is trading near all-time lows versus the dollar despite anticipation of an ECB rate hike. Oil held its ground in early trading despite reports of a 5.26 million barrel U.S. crude stock increase. This will be short today and we will update if anything of interest develops during the course of the day. Have a good day, fellow goldmeisters. Had it with the tired, one-sided anti-gold financial press mentality? If you want a fresh view of the gold market go to the link above for an information packet on gold ownership which includes our widely read newsletter, News & Views: Forecasts, Commentary & Analysis on the Economy and Precious Metals. We offer solid commentary in a rapid fire, no-nonsense, bullet format designed for busy people who want gold related news and opinion without the unnecessary fluff. And stay tuned here for our Daily Commentary. Please call Marie at 1-800-869-5115 or click here to request News & Views as well as our helpful introductory information packet for gold investors. We invite you to stay tuned to the gold market through our DISCUSSION FORUM featuring round the clock gold news & commentary from the public. PLEASE REMEMBER: It is your purchase of gold from Centennial Precious Metals that nourishes these pages. Call us at 1-800-869-5115 for prices and to have your questions answered. wolavka (8/30/2000; 8:09:39MT - usagold.com msg#: 35739) Gold Go Gold!!!!!!!!!!!!!! goldfan (8/30/2000; 7:14:04MT - usagold.com msg#: 35738) 714 on CB sales The questions I ask myself are:The gold shortage is said to be about 1500 tonnes per year. How could I know that to be true?If true, how is it being made up? Not by 400 tonnes from the CB's and the odd 50 tonne amount from those willing to respond to Washington's call. So, how? and how could I know that?I don't.But the fligures on excess asset inflation, and the figures on excess debt and derivatives in all markets, suggest a major debt crunch, according to analysts I respect. And I think I understand FOA's and ORO's analysis of the rise and coming fall of the US economic Empire, and I agree with them. But I don't know.And I can see for myself the excressive volatility of all markets, and I know what that means.Nothing is good as goldFWIWGoldfan Black Blade (8/30/2000; 6:27:24MT - usagold.com msg#: 35737) Oil for Gold? What ME countries are involved? Kuwait gave away their total official gold reserves of 79 tons. That's it? Maybe they aren't part of the gold for oil crowd, as 79 tones is nothing considering how much oil was sold from the Kuwaiti oil fields. Something appears wrong with that picture. Maybe only Saudi is involved in the oil for gold scheme. Can anyone clarify this for me? TG? Black Blade (8/30/2000; 6:20:19MT - usagold.com msg#: 35736) "Morning Wakeup Call!" Slow action in the PM markets. Think I'll go to "Burning Man!" Festival. Sources: BridgeNews Asia Precious Metals Review: Gold mixed; sentiment weakensBy Mari Iwata and Polly Yam, BridgeNewsTokyo--Aug. 29--Spot gold traded firmly at U.S. $272.60-273.40 per ounce for much of the Asian trading in moderate trading, but market sentiment weakened after the Sep option overnight expired at lower-than-expected price in the U.S. market, dealers said. Spot gold is expected to move at $270-274.50 in the near term. Trading of spot silver, platinum and palladium remained sluggish. Spot gold opened weak following overnight falls in the U.S. market, but it rose later as a result of trade buying from Australia, Japan and physical demand from Hong Kong, Taiwan and Singapore, dealers said. Dealers focused on the movement of Australian dollar as that could move the spot gold price. But Australian sources' selling and buying of spot gold were mild Wednesday, they noted. "Australia sold more gold than it bought," a dealer said, adding buying from Japan was relatively aggressive in the morning. Dealers see spot gold easing to test the nearby support of $270 in the near term. On Tokyo Commodity Exchange (TOCOM), gold futures fell due to overnight COMEX gold futures price falls, TOCOM dealers said. Although the yen was still strong against the U.S. dollar, TOCOM players sold gold futures as the dollar remained firm against most European currencies, the dealers noted. "Gold futures prices were low enough at the current 927-936 yen level. But speculators were expecting a further price fall (of TOCOM gold) on the back of strong yen. They may rush to buy if the price rises sharply," a TOCOM dealer said. TOCOM players bought TOCOM platinum futures actively in line with firm prices of NYMEX platinum futures, according to the TOCOM dealers.Black Blade: YawnMexico's Penoles says no shutdowns due to low silver pricesMexico City--Aug. 29--Mexican miner and the world's largest silver producer Industrias Penoles will not shut down any units or reduce activity as a result of depressed silver prices, a company executive said. Low silver prices are more a result of a high copper prices, low gold prices and less market speculation than of silver supply and demand imbalances, he added.Black Blade: An interesting round-about way of saying that there is a Silver shortage. Meanwhile, S&P Futures down -0.50, Fair Value up +4.75, modestly positive. Oil is down -$0.04 at $32.70/bbl. Au is flat at $272.50, Ag down 4 cents at $4.87, Pt down -$4.00 at $588.00 ($595.00 London AM), and Pd off -$5.00 at $711.00 ($710.00 London AM). Link to "Burning Man" for some Pagan Debauchery in the desert!http://www.well.com/user/tcircus/Burnman/ Leigh (8/30/2000; 6:04:24MT - usagold.com msg#: 35735) More Excerpts from the Euro Article Within Five Years: The euro will have established itself as a second leading currency equal to the U.S. dollar within the next five years. By the beginning of the year 2002, Europeans will actually be able to see and feel their currency with the first issue of euro bills and coins. By then, what amounts to Europe's secret weapon will be involved: a stronger, more stable business model.The simple fact is that the continent's attitude toward the business process is vastly different from U.S. corporate culture dominating the world of finance today. Most European marketplaces, notably France and Germany, are based on a consensus model that includes government, big business, and labor unions working together in relative harmony. The business application of this model takes more time to get off the ground, but in the long run it makes for stronger and more stable markets. And it should be remembered that Europe is still dominated by midsized businesses that are far more diversified than those in the United States.Even today, shareholder value is a brand-new concept to many European companies. That is likely to change in the coming years. U.S. investors will need patience: In the short run, European markets mean lower growth and lower revenues than in the United States, but more stable and less risky long-term investments. And success requires the intellectual understanding that doing business differently does not necessarily mean doing business less effectively. Europe will not adopt the U.S. system, which many view suspiciously as unfettered capitalism.Europe in the year 2005 will have several new members in both the EU and EMU. Some Eastern European countries no doubt will have joined the EU club, and, most likely, the United Kingdom will have joined the EMU. Even Russia might someday be invited to join in one form or another. Trail Guide (8/30/2000; 6:04:09MT - usagold.com msg#: 35734) Note TownCrier,Thank you very much for your time in fixing the Gold Trails page! I will be placing a few of my recent posts on it and then we can begin hiking "current events" as seen from the eyes of others. Also, Cavan Man, I'll be discussing Mr. Howe's latest thrust then. This next leg of the trail should provide a nice parallel to actual events unfolding on our world gold markets. Trail Guide Leigh (8/30/2000; 5:52:20MT - usagold.com msg#: 35733) Article on the Euro Here are some excerpts from an article entitled: "Guten Morgen, Europa!" in the August United Airlines Hemisphere magazine. The Immediate Future: In the near future, Europe will acclimate itself with its new economic structure - chiefly the common currency. A year and a half after the euro's January 1, 1999 launch, the future is hard to predict. But the euro is widely expected to become the world's second-leading global currency and a serious threat to the U.S. dollar, probably not in a head-to-head competition, but in a more subtle way. The weak euro is sweeping aside more expensive American products in U.S. export markets because of their higher prices around the globe, thus slowly undermining the standing of the dollar. Even today, the euro is partly responsible for record-high U.S. trade deficits.In the future, this could lead to a "clash of the titans," as C. Fred Bergsten, director of the U.S. Institute for International Economics, has predicted. The arithmetic is very simple: In a united Europe already liberated from tariffs, the euro is setting free economic forces that have been bound until now. Companies can lower costs, work much more independently, and reach out more effectively to other European countries and even around the globe....The merger of Daimler-Benz and Chrysler in 1998 and the takeover of German Mannesmann by British Vodafone are good examples of a restructuring process squeezed through strict European laws. European stock markets, too, are bustling, the sign of a vigorous economy. New stock indices such as the Dow Jones Euro STOXX 50, a composite of 50 leading European blue-chip companies in Euroland, have become more important than national indices such as Germany's DAX....Another wake-up call was the announcement that the London Stock exchange and the Deutsche Borse will join in a new company called iX, thus suddenly ending their duel over which of the two is Europe's leading stock market. Now, London and Frankfurt together will challenge international marketplaces such as Wall Street and Tokyo.For investors, these developments mean a dramatic change in strategy. As in the United States, they will now invest in market segments and industries rather than in national markets. National boundaries and currencies have become meaningless. However, there is one decisive exception often overlooked by non-Europeans. Investing in export-oriented companies in future EMU-member states, such as Greece or Denmark, promises high returns because of their long-term potential within the EMU.The Next Two Years: New markets will continue to loosen up and be more accessible for foreign investors. Formerly high-interest rate countries such as Ireland, Spain, Portugal, and even Finland and Italy, are experiencing economic growth rates as high as 8 percent because of the lower EU interest rates. Rich and poor countries alike are finding common ground in the future. Though observers expect the current boom to slow to more normal growth rates in the next two years, leading economies such as Germany's are becoming attractive both for companies and investors.It is hard to believe but true - some European countries, such as Germany, are still going through the restructuring process that took place in the United States and Great Britain as far back as the mid to late 1980s. Companies and investors outside the EU can capitalize on this development because of several factors. In the face of competition from other EMU-member states, Germany will slowly have to give up the strict labor, price, and other regulatory statutes that are so dear to Germans. Germany's popular saying "Konkurrenz belebt das Geschaft" ("Competition revitalizes business") will finally become a geniune incentive to investors from abroad as competition increases across the continent. In the process, German midsized companies also will have more favorable opportunities to position themselves and compete beyond Europe.One of the major prerequisites for global competitiveness has already started sweeping the continent - mergers and acquisitions. Europe is beginning to experience a wave of market concentration similar to what took place in the United States in the late 1980s. The European economy is still rather fragmented, and the trend leads toward concentration on an intra-European level. The process is likely to continue in the next two years. And one day, no doubt, it will reach beyond the continent's borders.(More in a few minutes.) Canuck (8/30/2000; 5:41:47MT - usagold.com msg#: 35732) Reg Howe's latest http://www.goldensextant.com/campaign2000.html#anchor48727 Mr. Howe's latest essay is a MUST read (as two or three previous have already stated). Follows the gold market over the last couple years. Stellar insight, excellant flow that provides the reader with a clear picture of the 'management'of gold pricing.A tidbit,-----------------------------------------------------------"In the wake of the October 1999 rally, two very odd disgorgements of official reserves were disclosed by countries outside the Washington Agreement. That very month, Kuwait announced that it had made its total official reserves of 79 tonnes available to the Bank of England for leasing. Soon afterwards new U.S. military aid to the country was disclosed. With regard to the Kuwaiti announcement, a top BIS official observed that it was so far outside normal practice as to permit only one conclusion: someone was trying to manipulate the gold market. On the heels of Kuwait's transfer, Jordan revealed in November that it had sold half its gold reserves (13 tonnes) during October.In July of this year, the World Gold Council reported that Uruguay had transferred all 56.6 tonnes of its gold reserves to London for leasing. This month, just prior to announcing a new effort to speed up trade talks with the United States, Chile revealed that it sold all 34 tonnes of its official reserves in June. Recently the World Gold Council quoted Gold Fields Minerals Services, once generally regarded as the pre-eminent source for figures on the world gold market but now suspected of operating more as a shill for the bullion banks, to the effect that about half of last year's gross official sales came from publicly unreported "non-monetary" gold reserves. Oil-rich nations of the Middle East are among the countries that report quite modest amounts of official gold reserves but are generally believed to hold large unofficial reserves.Precisely where all this physical gold is going and to whom is unknown, but all these odd and unprecedented recent official gold disposals almost certainly are signs of a serious liquidity crisis developing in the gold derivatives business of the bullion banks. Because these disposals are so unusual and appear contrary to the interests of the countries making them, they also raise questions about exactly what forces may be causing them."----------------------------------------------------------End.Notice the theme, "odd disgorgements, so far outside normalpractice, odd and unprecedented gold disposals, unusual and contrary," etc., etc. There still are no answers to the BOEannouncement last May. The logical rationale remains at zero.Mr. Howe goes from A to Z on gold; it is a long, complicatedread but he patiently allows the reader to follow the timeline.Please note the 'poke' at Gold Fields Mineral Services. Mr. Howe, in his comments last month (following the Paris convention) made a similiar comment. I anxiously awaitfurther developments between him, GATA and GFMS. The debate being of course the gold short position now estimated by GFMS at 5,000 tonnes. GATA (& Mr. Howe) feel this to be low,possibly very low. If you recall in Paris, GATA offered at their expense a follow-up debate with GFMS to discuss the gold short postion; GFMS declined.Go Reg, go GATA, go gold!!! Over to the printer. Bonedaddy (8/30/2000; 5:23:51MT - usagold.com msg#: 35731) How widely spread is the delusion? The appearance of wealth is determined by ones standard of living. How large is the house? How loaded is the new fuel hungry SUV? Where is the kid enrolled in college? Under the current delusion, all these things are indicators of wealth. Credit is the only limit to what one can "achieve" and the sky's the limit. It seems as if the entire nation is caught up in a buying frenzy. I guess we feel that we have to get something for all of the hours we're working. What most of us are getting of course, is "one day older and deeper in debt" as the song goes. Most of us here know that real monetary wealth is determined, not by what we owe, but by what we own. While I find the current set of economic circumstances repulsive and sad, there is a silver lining. The amount of GOLD that can be purchased in trade for rapidly depreciating dollars is remaining much more constant that the price of other necessities. I remember the intuitive feeling that I had in Febuary of 1999. I just could not see any way for the price of oil to remain permanently low in the face of so much demand. The low price defied my logic, but there it was. I wish I could have stored some at those prices. The answer to the price riddle was that no one was really aware of the growing shortage. Prices should have been rising over a much longer period of time. Now I'm listing again to that same little voice of intuition. How can the price of GOLD stay so low in the face of rising prices for other goods and increasing world wide demand? Well, we all know it can't. There is just something so "human" about waiting until all the rest of the crowd figures it out and acts accordingly. I agree with many others here, that energy prices will be the trigger for the recognition that inflation is rampant. "When I snap my fingers, you will awaken and have no memory of the previously rosy economy". wolavka (8/30/2000; 4:31:50MT - usagold.com msg#: 35730) Technicals Math formation shows something has to pop. One way or the other , dollar index and /gold, somethings got to give.NEVER TRUST A GOVERNMENT.go gold!!!!!!!!!!!!!!!!!!!!!! 714 (8/30/2000; 4:15:23MT - usagold.com msg#: 35729) Is gold being sold to keep oil down... ...or is it being sold for other reasons? After all, it's only the Saudis being paid in gold for their oil and the oil-for-gold trade is still benchmarked in US$'s. SteveH (08/30/00; 03:29:02MT - usagold.com msg#: 35728) Implies gold is being sold to keep oil down... www.kitco.com ...but it isn't working!Date: Wed Aug 30 2000 01:35The Vet (Earl :@ bucks in the dunes) ID#307254:Nope - everyone bitching about how much OPEC are getting but not a comment on where those fiat dollars are ending up.. Funny thing though there seems to be lots of gold sold recently without a lot of price drop ... I just wonder if ... nah, nobody wants that gold crap.... Cavan Man (8/30/2000; 0:17:00MT - usagold.com msg#: 35727) TG/FOA http://www.goldensextant.com As if this latest essay wasn't enough reason(s) to hold metal, what is your analysis please? ViewYesterday's Discussion.
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