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ARCHIVED DISCUSSION FROM 1/30/2006 All times are U.S. Mountain Time (Yesterday's Discussion.) Topaz (1/30/06; 23:56:39MT - usagold.com msg#: 141046) mikal, G-dome. http://www.softwarenorth.net/cot/current/charts/GC.png mikal,"Total" OI (see Chart) has been consistently high throughout the last little run-up and with 30 odd thousand still open for Feb, we could expect an eye-opening flurry of activity today on the delivery front.Consistently strong Silver saw 1400 deliveries done in Jan vis 40 odd for Au.Silver has the potential here to run back to it's historic mean with Gold. 100/1600 is a good chance even IF the wheels stay on.If they fall off, Gold will shine the stronger imo. Those souls who dismiss Comex activity as being irrelevant to price discovery really don't get it.G'dome,Having just spent the last three weeks frantically dollar-cost-averaging up to get me some after mis-reading the market, I'm hardly the one Prechter might turn to for support however,the potential for a deflationary wash-out of the type envisaged by him, is STILL very much the Sword hanging over these Markets.The impact(paper)Comex has on "price" is reason enough to keep a weather eye in that direction methinks. Goldilox (1/30/06; 23:50:29MT - usagold.com msg#: 141045) Central Bank Sales News/Gold Open Interest/COT Report: STUNNINGLY BULLISH!!! http://www.howestreet.com/articles/index.php?article_id=1976 snip:Seems to me Mr. Williamson was neutral to bearish all the way up the last four years. Why the MIDAS hoopla:*The gold market cannot handle an unexpected 1,000 tonne drop in expected central bank sales. The Gold Cartel and other shorts desperately need the European central banks to sell 2500 tonnes of gold per year and clandestinely lease gold on top of that.*The yearly supply/demand deficit is 1500 to 2,000 tonnes right now. The price of gold is taking off anyway. Without all the allowed central bank gold hitting the market, the price HAS to SOAR!*This is nothing less than sensational talk coming from the mainstream gold world. It MUST have The Gold Cartel gagging.*All of this continually changing talk has surfaced following Gold Rush 21 and the Russians leaving our conference in Dawson City.Before Gold Rush 21, talk of central banks buying gold (Russians, Iranians, Chinese, South Koreans) was virtually non-existent, as was any talk the central banks might not come close to meeting their Washington Agreement quota.*The Gold Cartel is likely experiencing some angry fallout from central bank sheeples who now feel duped about selling their gold at such low prices. GATA hero Ferdi Lips said years ago the Swiss would rue the day they dumped gold at bargain basement prices years ago.The gold open interest news is nothing less than stunning and very exciting as it continues to confirm the MIDAS/GATA analysis that The Gold Cartel and others are desperately trying to cover their shorts whenever they can. It fell a whopping 9987 contracts to 351,369!!!I am not sure how yesterday's option expiry plays into this (probably call owners selling futures the last few days and given long futures for their calls, thereby reducing the OI, which led to this sharp OI reduction). However, it does not matter in the end. The bottom line is gold has risen some $120+ while the gold open interest is more than 20,000 contracts off its highs.The gold market is NOT overrun with foaming specs yet. Based on the price action, there is room for 100,000 more specs to pile into this market before it gets overdone. Those specs will be competing against more and more pale faced shorts trying to cover their butts. Gold remains explosive.Just in … Not only are the gold open interest numbers continually bullish, so is the Comex Commitment of Traders report. The large specs reduced their longs by 2,722 contracts and increased their shorts by 2,908 contracts. The small specs reduced longs by 695 contracts and increased their shorts by 661 contracts. The commercials reduced longs by 3152 contracts, yet REDUCED SHORTS by 10,318 contracts.Once again we have concrete evidence the Commercial Signal Failure is in play. Facts are facts. Meanwhile, instead of the specs driving the market up, they are going more SHORT. This is SO bullish!The silver open interest only rose 1069 contracts to 133,175. The Silver OI is around 10,000 contracts off its old high. For silver to rise like it has, and for the open interest to go up so modestly, tells us the silver shorts are scared stiff … with many of them finally wanting out too. Goldilox (1/30/06; 23:35:55MT - usagold.com msg#: 141044) Sinclair on the "savings rate" http://www.jsmineset.com/ snip:Maybe I am on the wrong planet, but when you borrow to spend like mad people you must hit the stone wall of insolvency at 200 mph. Not only is the US a national debtor of note, but US citizens have followed in the footsteps of their leaders. This entire thing is totally out of hand. There can be no doubt that the US is headed for an economic disaster of orders of magnitude greater than any such prior experience. US consumers dip into savings as spending risesBy Christopher Swann in WashingtonPublished: January 30 2006 16:29 | Last updated: January 30 2006 17:56 US personal spending rose by 0.9 per cent in December, beating forecasts and bolstering the belief that consumers remained in high spirits.The strong rise in expenditure, the fastest since July, came in spite of modest wage growth of just 0.3 per cent.Much of the extra spending was funded by borrowing, with Americans eating into their assets for the seventh consecutive month. In December the savings rate fell to minus 0.7 per cent, meaning Americans spent seven cents more than they earned for every $100 of income.Goldilox,It's OK. We'll make up our losses in VOLUME! Goldendome (1/30/06; 23:28:25MT - usagold.com msg#: 141043) The other side of the coin: http://www.howestreet.com/ If you want to listen to a person who says: Put your savings into Gold and silver: Listen to the January 23,2006 interview with Doug Casey at the linked site. (if your computer can handle it.) Interesting fellow, IMO.Touches a lot of subjects. Goldendome (1/30/06; 23:10:28MT - usagold.com msg#: 141042) Speaking of people consistently wrong: Robert Prechter http://www.financialsense.com/transcriptions/Prechter2005.html I still don't believe that Prechters changed his opinion, afaik, that is expressed in this interview, even though all the perameters have long since been met. Prechter, you may recall, was expecting everyone would be buying gold again for way below $300 again, long before it would ever hit $500. Why people continue to pay money for his hack (imo) newsletter, just slays me...How many of his followers must be banging their heads now, wondering why?--------------------------------------------Excerpts from a Financial Sense Newshour interview by Jim Puplava with Robert Prechter: June 18, 2005.Bob...In 1987, for example, silver topped out in April of that year and had some more rallies but it was pretty much over. Gold kept going up until December, and that's when it finally topped out and had that tremendous drop that we talked about earlier. Well, we had almost the same thing happen in 2004. Silver made its peak in March. It's had several rallies since, but it has failed to make a new high. Gold continued higher and finally topped -- guess when -- in December. So you've got almost the identical situation in both of these bear market rallies. As long as silver continues to fail to take out its high of early 2004, I would say you've still, on that basis, got a set-up for a bear market, or at least one more wave down in a bear market. So I'm bearish from at least 3 different standpoints. Who knows? I don't have to be right about it, but the evidence to me is overwhelming: you don't want to be in the metals or in the metal stocks at this time.JIM: Bob, as in any kind of forecast there are things that change, the world evolves, it changes. What are the things in your mind that would change or have to change to cause your view to change from a deflationary depression?BOB: That's a good question. I think one of the things that would have to happen is a confirmed new high in gold and silver together. That would wipe out much of the negative development that I see at the moment. You'd have to see gold going up in terms of all the currencies. If it doesn't, then gold may get into a bull market in dollar terms, but then gold is not the only thing that you need to own. You're welcome to be bullish on gold but you may as well hold Swiss francs. So the key here is, is it just a dollar fall, or is gold going to be in a great bull market? I guess that is the main thing that would make me change.[Small break in sequence of interview]...JIM: When I asked you previously what would have to change and you would have to say new highs for gold and silver. Is there a level in silver and gold you would like to see before you would have to say I need to go back and examine this?BOB: Well, gold topped at $457/oz, so if it goes above there and silver goes above its high of early 2004 which was, what, $8.20-8.30, then I would have to say something is going on that is changing the technical situation. Sometimes the technical situation can change, and I am looking at data every single day to make sure that we are on track here. But I really think if your readers want to get a feel for it, I've got four whole pages discussing all this in the latest issue, and if they want to get a hold of it that will tell them exactly why I think what I think. mikal (1/30/06; 22:50:40MT - usagold.com msg#: 141041) April Comex OI shows many shorts were closed out http://www.futures.tradingcharts.com/chart/GD/46 Gold 100 oz. (GC, COMEX): Daily Commodity Futures Price Chart: April, 2006Gold OI rolled over into April contract shows many positions were closed out in January as POG advanced. specie-man (1/30/06; 22:46:02MT - usagold.com msg#: 141040) Sunshine Mining/Minting Sunshine Minting is still operational. They are located in the silver-producing region of Idaho. They provide private minting services. They also mint bullion items. I don't recall any gold items minted by them, but I wouldn't be surprised if there are some out there. I've seen many silver bars made by them. Their silver bars are readily accepted in the market. A 1-ounce gold "round" would probably be accepted as well. I doubt that the one you have is fake. Goldilox (1/30/06; 22:37:56MT - usagold.com msg#: 141039) THE END OF AN ERA http://www.financialsense.com/Market/wrapup.htm snip:Tomorrow's FOMC [Fed Open Market Committee] meeting will be the last chaired by Alan Greenspan – who hands over the reigns as Chairman of the Federal Reserve to Ben Bernanke on Wednesday, Feb. 1.That the Fed is expected to raise its short term lending rate [also referred to as the overnight or Fed Funds rate] should come as no surprise to anyone. If tomorrow's widely expected 25 basis point rate increase follows the pattern set in June of 2004 – it will be the 14th time the Fed has raised the trend setting rate in successive meetings since June 30, 2004. While it has been the Fed's stated goal, time and time again, throughout this rate raising regime – "to remove excess accommodation at a measured pace" - there are lingering questions that remain to be adequately answered, namely:Why have long term rates remained virtually static since the Fed embarked on its rate raising campaign? The interest rate conundrum has never been adequately explained by anyone at the Fed.A question that I'm sure everyone would like to know – Will Ben keep hiking rates?The answers that have been bandied about in the mainstream press regarding question number 1 have ranged from theories that record U.S. deficits are a "sign of economic strength" to charges that foreigners see U.S. debt obligations as the "safest" investment choice in the world. Given that the monies which are actually sopping up the record amounts of U.S. debt are those almost exclusively of Foreign Central Banks – not individual's private savings - I find that proposition somewhat hard to swallow.The answer to question number 2 is of utmost importance to investors as well as home and business owners alike. Perhaps, with the changing of the guard - the Fed will seize the opportunity to provide the minions with a greater degree of clarity in their statements that accompany their interest rate decisions. I could think of no better way for Mr. Bernanke to display some much needed probity to start his Chairmanship on the right foot.More New BloodAlmost lost in the hoop – la of the passing of the chairmanship, President Bush announced on Friday, Jan. 27, 2006 two nominees to fill vacancies on the Federal Reserve's Board of Governors.Nominated were Randall Kroszner, 43, an economics professor at the University of Chicago's graduate school of business and former member of Bush's Council of Economic Advisers. Also nominated was Kevin Warsh, 35, a special assistant to the President for economic policy at the White House. Previously, Mr. Warsh served as executive director and vice president of mergers and acquisitions in the investment banking division of Morgan Stanley.Coincidentally, or perhaps not, both of these individuals – no, in fact – all of these individuals have a direct lineage to Harvard – where they all completed post graduate work. mikal (1/30/06; 22:15:29MT - usagold.com msg#: 141038) @montlee I had several 1 ounce Ag(silver) rounds depicted exactly as you described, except that the words "fine gold" were "fine silver". I have seen these and similar coins plated in 24 kt gold also. I also once had a Morgan dollar replica plated with gold, stamped "One ou fine(or.999) silver". FWIW. Good luck. Goldilox (1/30/06; 22:11:23MT - usagold.com msg#: 141037) Pre-Weimar housing inflation @ Rook,I am sure those would be interesting numbers, and if they're available, TC probably knows where.A major difference exists in the equity equation. Current US and other western home-owners are dealing in leverage values that shock even our parents, much less the more conservative world of our great-grandparents and Europe in particular.Heck, they even shock me. My first two homes "required" 20% down to even consider a real estate loan, and one major lender stuck me with a "margin call" when the SillyClone Valley bubble prices of 1991 deflated just enough to bring my LTV back above 80% by "their" estimates.Just imagime what the "margin calls" will look like for today's "no money down" deals - not to mention ARMs and delayed rate mortgages - if this RE bubble adjusts even 10%. "Hello happy home-owner.Your LTV has risen to 110%, and our loan agreement says (in 4 point FONT) that you must maintain LTV at or below 100%. As your $700K property has now fallen $70K, we are requesting that you remit that amount to avoid foreclosure."YOWZERS! mikal (1/30/06; 22:07:23MT - usagold.com msg#: 141036) Gold OI dives http://futures.tradingcharts.com/chart/GD/26 Gold 100 oz. (GC, COMEX): Daily Commodity Futures Price Chart: Feb., 2006Gold's OI(Open interest) diverging noticeably at bottom of chart during January while gold rises. Hmmm. Goldendome (1/30/06; 21:50:15MT - usagold.com msg#: 141035) Some getting their pipes cleaned. Great! isn't it Pritcho? I mean, so many supposed "experts" have called a top in gold for the last 100 points or so. I just love seeing it get shoved right up their exhaust pipes. Goldilox (1/30/06; 21:42:54MT - usagold.com msg#: 141034) Sunshine bullion Not sure if would have chosen the term "novelty" for the Sunshine coins, given the high incidence of "genuine gold-clad replicas" flooding the Boob Tube these days. These $20 TV fakes are the real "novelties", as they contain less gold than a crowned molar.If Sunshine's coins are truly .999 fine, they should still be worth spot value or close to it, but it might be more difficult to find a buyer who respects their authenticity. PRITCHO (1/30/06; 21:42:25MT - usagold.com msg#: 141033) Historic Gold V Silver - - - http://jessel.100megsfree3.com/goldsilver.png A very interesting Chart for those that give a chit :) PRITCHO (1/30/06; 21:36:38MT - usagold.com msg#: 141032) From Richard Russell (Latest Comments) Jan 30th - - http://www.321gold.com/editorials/russell/russell013106.html From another Web site - -Snip:"Gold staying overbought, characteristic of great bull markets. Those who want in are waiting for the correction that a seeming army of analysts are promising is "just around the corner." Meanwhile, the gold bull snorts, tosses his head -- and moves higher. The twin bull of silver does the same." Toolie (1/30/06; 21:19:48MT - usagold.com msg#: 141031) Radio tonight http://www.trendsresearch.com/ Gerald Celente is on the first hour of Coast to Coast AM this morning. I've heard him before, he's a good listen and a gold bull. The subject tonight is global trends and the hollowing out of the US mfg base.Best wishes Belgian, thanks!http://www.coasttocoastam.com/ Rook (1/30/06; 20:25:54MT - usagold.com msg#: 141030) .,. Goldilox, I wonder what house prices rose to during the german inflation. It would be interesting to see the pre to top inflation prices in dollar terms. Todays. Wonder if that is available anywhere. OvS (1/30/06; 19:43:16MT - usagold.com msg#: 141029) Guided. Belgian was refering to Peter Munk, Chairman ofthe board of the largestGold Corporation in theworld: Barrick Gold Corp.He is the skiing partnerof Prince Charles, thepretender to the throneof England, has on it'sadv.board an X-Premier ofCanada and George Bush,Sr.etc. OvS Ned (1/30/06; 19:19:01MT - usagold.com msg#: 141028) We'll just gather up a few more friends............... .....and we smoke the CABAL !!!!!Good night Katie !! White Hills (1/30/06; 19:17:37MT - usagold.com msg#: 141027) sunshine mint Sunshine Mint is a private mint. I don't know if they still are in business. There are quite a few 1 gram ingots sold on ebay as well as other small gold ingots of different weights. White Hills Ned (1/30/06; 19:17:26MT - usagold.com msg#: 141026) Ha ! Ha ! Gold (spot) gets smoked off of $570 exactly.Blow it in your ear CABAL !! contrarian (1/30/06; 17:54:41MT - usagold.com msg#: 141025) Prediction for tomorrow I think it's a safe bet to say tomorrow, with State of the Union speech, gold will get hammered and Dow rise, so this gold rise today is just setting up for tomorrow. montlee (1/30/06; 17:28:02MT - usagold.com msg#: 141024) Sunshine Golden eagle The coin says SUNSHINE, GOLDEN EAGLE, 1987, (with a picture of an Eagle and the rising sun) on one side. The other side says, SUNSHINE MINING, .999, FINE GOLD, ONE, TROY OUNCE (with a picture of the rising sun. Hope this helps. Monte Guided (1/30/06; 16:51:47MT - usagold.com msg#: 141023) Belgian His last post seemed to emphasize "Now" on two brief points. He always seemed to choose his words carefully. Who is Mr. Munche? TownCrier (1/30/06; 16:31:11MT - usagold.com msg#: 141022) montlee, gold Eagles http://www.usagold.com/gold/coins/Eagle.html The bullion items known as Gold Eagles are strictly a product of the United States Mint from 1986 onward. The are 22k -- .9167 fineness.Methinks what you have is a corporate novelty of some sort.R. montlee (1/30/06; 16:09:18MT - usagold.com msg#: 141021) Sunshine Mining I have a 1987 Gold Eagle, Troy ounce, .999 coin, by Sunshine Mining. How can I tell if it is fake or did they make fake ones? ThanksMonte USAGOLD Daily Market Report (1/30/06; 16:04:11MT - usagold.com msg#: 141020) Page Update! http://www.usagold.com/DailyQuotes.htmlThe 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.MONDAY Market ExcerptsJanuary 30 (from MarketWatch, Reuters) -- COMEX April gold contracts closed above $570 Monday for the first time in over a week, marking the highest close for a lead-month contract since January 1981. April futures climbed as high as $571.20 before closing at $570.60, up $6.90.Traders saw the market's strength, after a pullback from a 25-year highs, as constructive for a test of higher prices. "We're still in a bull market," a trader said. "We rallied up way too fast, and it is consolidating and now starting to build a base. I see it going higher."The metal is expected to continue to trade off political uncertainty surrounding Iran's nuclear ambitions and the surprise victory of Hamas in last week's Palestinian elections, although volumes are lighter than normal with much of Asia closed for the Lunar New Year holiday.Rollover into April from February gold was almost complete, before deliveries start on Wednesday. Traders said there was little visible effect on gold and silver after NYMEX raised margin requirements on those futures contracts, effective with the close of business on Monday.The Fed is expected to raise its key interest-rate target by another 25 basis points to 4.5% on Tuesday, Chairman Alan Greenspan's last day in the job after more than 18 years.But for the first time since it starting boosting rates in June 2004, the central bank will pull the plug on the forward-looking language that has guided markets toward conclusions about future rate moves. It is likely to retreat to its old tradition of keeping markets guessing, economists said."The longer-term outlook for gold remains robust, given constrained output and soaring physical demand from the major emerging economies of India and China," said Action Economics.---(see url for full news, 24-hr newswire)--- The Invisible Hand (1/30/06; 14:47:20MT - usagold.com msg#: 141019) Trading oil in euros – does it matter? http://www.energybulletin.net/12463.html Published on Monday, January 30, 2006 by Energy BulletinBy C--il'n NunaSNIPSSome commentators have [...] suggested that Iran's real Iranian threat to the US and its economy is that, in defiance of the US administration, it is attempting to establish an oil ‘bourse’ (exchange) in March of this year which would enable oil to be traded in euros. This would move oil sales away from their usual denomination in dollars and would, it is argued, undermine the American currency with grave consequences for the US economy.+However, others have claimed that the idea that the currency in which oil is sold matters at all is based on a poor understanding of economics+The possibility that the Iranian oil bourse might not use euros would not necessarily diminish its significance and there could still be good reason for believing that US/UK governments and financial interests would still be strongly opposed to it as it would challenge their control of oil trading, but that is another question.==Belgian, come back! They are craxy!Kom terug, ze zijn zot! USAGOLD / Centennial Precious Metals, Inc. (1/30/06; 14:32:02MT - usagold.com msg#: 141018) A special combo of assets and info to help you enter the gold market with grace and confidence! http://www.usagold.com/gold/special/starter.html mikal (1/30/06; 14:17:59MT - usagold.com msg#: 141017) 10 fatal frauds of the "Fed" http://www.lewrockwell.com/reynolds/reynolds14.html Don't Make me Laugh: The Fed and Kept Media - Morgan Reynolds - January 30, 2006Very accurate, concise expose of Fed fallacies based on a recent Cox News Service story, ending with the author's plea for gold ownership. Liberty Head (1/30/06; 13:55:18MT - usagold.com msg#: 141016) Flatliner - VAT One can avoid tax on gold in the US by funding a Roth IRA with precious metals. One would have to believe the POG would climb to $1200/Oz in five years before it would be worthwhile IMHO.Also, the gold sale reporting laws in the US are worded in such a way as to invite gold owners to skip declaring capital gains on sales of 25 ounces or less. I don't think the reporting structure for gold is an oversite.In some strange way that I don't fully understand, the gov't benefits from the sale of Gold-Eagles.Gold ETF gains get you hit with a 28% capital gains because the gold owned by the fund is not all gov't approved gold bullion.Best Wishes TownCrier (1/30/06; 13:46:40MT - usagold.com msg#: 141015) 968, Russia considering VAT reduction on gold "Randy, I think this will sound like music in your ears..."Specifically, 968, it rings in my ear with the distinctly lovely sound of Beethoven's Symphony No. 9, final movement, "Ode to Joy" (non-choral) -- and I'm sure you get the subtle significance behind my mention of that particular tune.R. 968 (1/30/06; 13:30:34MT - usagold.com msg#: 141014) Christian Noyer: The eurosystem's single monetary policy - a view from the inside http://www.bis.org/review/r060130a.pdf Speech by Mr Christian Noyer, Governor of the Bank of France, at the GIC Conference hosted by the Federal Reserve Bank of Philadelphia, Philadelphia, 18 January 2006.SNIPS :"Benjamin Franklin continues his description of these virtues in the following terms "Frugality and Industry freeing me from my remaining debt, and producing affluence and independence, would make more easy the practice of Sincerity and Justice, ...,". He emphasises the importance of being freed from one's debts and recovering one's independence. We know from his political activity that he attaches a great deal of importance to the independence of the Nation, but here we are talking about that of individuals and therefore of the institutions for which they are responsible. As we will see later, this is the type of independence that lies at the heart of the Eurosystem.""The single currency for a long time met with the scepticism from many observers, who regarded it as unrealistic first to launch a new currency and second to envisage a single monetary policy for a group of countries that, despite rapid convergence, continued to display major differences. Interestingly enough, the assumption made by some observers and market participants that the entry interest rates in the Euro on 1 January 1999 would be some kind of average of the interest rates of the composing currencies proved to be wrong. On the contrary, and since the very construction of the Euro was based on continuity with the most credible national currencies, it was foreseeable that interest rate convergence inside the future Euro area would take place progressively on the basis of a merge of different yield curves of the various currencies with the benchmark yield curve corresponding to the most performing and credible ones, as it effectively happened.""The recent nay votes from France and the Netherlands to ratifying the EU constitution rattled Europeans concerns for the future. Some observers immediately conjectured that the single currency was directly responsible for the muted economic performance of the euro area and publicly questioned its durability; however, the track record of the Single monetary policy, after only 6 years of implementation, has been really impressive: the inception of the euro has been associated with an increased macroeconomic and price stability within the euro zone, despite an unusual sequence of unfavourable events, adverse supply shocks and periods of global financial turbulences.""The point I would like to set out today is that a high degree of credibility, transparency and predictability of the Eurosystem's monetary policy is a key condition for its efficiency.""Drawing on this analytical expertise and the experience of the national central banks of the participating countries, the Eurosystem is first and foremost based on a modern institutional framework, founded on the principles of independence, transparency and accountability and, lastly, operational decentralisation.""Contrary to the US, the use of modern technology and communications has made it possible for market operations not to be concentrated at a single geographical location, but to be carried out simultaneously at all of the National Central Banks. The same type of arrangement applies in other monetary areas (cash management, payment systems, etc.).""...especially in the early days, we were confronted with substantial criticism regarding our definition of price stability, considered by many observers as too ambitious. Two points are worth mentioning at this stage: - First, due to the scepticism I already mentioned and for credibility reasons, it would have been damaging for the euro not to build on the credibility of the most efficient and successful participating national central banks, that had previously chosen 2% as the ceiling for their definition of price stability; - second, this criticism has abated recently and it is interesting to note that the definition of price stability has converged towards a level close to, if not below, 2%: in December 2003, Gordon Brown announced a new inflation target for the Bank of England, based on the HICP, and set at a level of 2% for the 12-month increase; in the US, Ben Bernanke, recently appointed to take over A. Greenspan at the end of the month, advocated for a quantitative definition of the FED's price objective comprised between 1 and 2% over the medium-term.""External observers sometimes criticise the complexity of the Eurosystem's monetary policy strategy and argue in particular that the monetary pillar or analysis does not provide any useful information for our monetary policy decision. It is considered by some as superfluous, confusing if not as an obstacle to transparency. To give money an important role in its monetary policy analysis and strategy is however quite a natural thing for a central bank geared towards price stability to do, as inflation is "ultimately always and everywhere a monetary phenomenon", to quote again Milton Friedman.""Confronted with a series of adverse exogenous supply shocks (affecting in particular oil prices, food products and services prices) leading to a rise in the HICP of above 2% in year-on-year terms from 2000 to 2002, the level around which the HICP has hovered since, the Eurosystem has been able to achieve its main objective: since the Eurosystem became responsible for monetary policy in the euro area, HICP inflation has averaged 2%, which is near to the "close to but below 2%" at which we aim over the medium term. Let me remind you that HICP inflation was around 4% in the 1980's and about 9% in the 1970s.""Until recently, the single monetary policy also succeeded in stabilising and anchoring medium to long-term inflation expectations at around 1.8% to 1.9%, despite all the above mentioned shocks. That is to say, once again, at a level close to, but below, 2% in accordance with our definition of price stability – whether one takes the inflation expectations derived from surveys or those drawn from market data, notably index-linked government bonds. Recently, the awareness of a durable higher cost of oil has pushed expectations slightly above 2%. The last December key ECB interest rate's hike has however brought these market expectations back to 2% that is to say in line with our definition of price stability over the medium term.""From 2001 to 2003, the annual growth of M3 was well above its reference value. However, an in-depth analysis of M3's components and of its main counterparts showed that the dynamics of M3 was mainly due to extraordinary portfolio shifts into M3, in a context of heightened economic, financial and geopolitical uncertainty. This implied low medium-term risks for price stability, as captured by the monetary indicators presented in figures 4 and 5, and allowed the Eurosystem to enter an easing cycle.""The situation has changed since the second half of 2004 as reflected by the monetary indicators: first, broad money aggregates accelerated in parallel with increasing demand for loans to the private sector; second, this acceleration was mainly driven by the most liquid components of M3, pointing to a significant impact of low interest rates on monetary dynamics. Furthermore, the growth of borrowing, especially mortgage loans, remained very robust, fuelling a sharp increase of housing prices across the euro area. In such a situation, the risks revealed by the monetary analysis to price stability over the medium-term were strongly revised upward.""As regards the frequency, since the inception of the euro in 1999, the Eurosystem has changed its policy rates 16 times (8 cuts, 8 hikes), which is on average close to the usual average frequency of interest rate changes. However, compared to the Federal Reserve, in particular since 2001, the frequency of the changes is by far lower. Does this necessarily imply that the Eurosystem does not move enough or too low? I think there is a broad agreement on the fact that interest rate decisions are state-dependent rather than time-dependent and as a consequence, both the frequency and the amplitude of the policy changes are mainly driven by the underlying state of the economy. As far as the Eurosystem is concern, the more gradualist approach is nothing but the reflection that the economy of the euro area has been less affected by cyclical fluctuations than the US economy. Moreover, recent research carried out by the Eurosystem on inflation persistence tends to show that the degree of inflation persistence in the euro area is quite moderate while the degree of price stickiness is considerable and higher than in the United States.""In the post-war European adventure, the euro represents a major milestone. That said, and whatever its own merits, a currency is not an end in itself, even though the new EU members are keen on adopting it as soon as possible. Entry into Monetary Union must be founded on a sustainable convergence process. Enlargement of the euro area also gives renewed impetus to addressing the challenges ahead as it makes it more pressing for policy-makers to tackle long-ignored weaknesses. This is a crucial contribution to building a stronger EU, in which I strongly believe."----------------------------------------------------------------------------------------------------------------------Randy, I think Mr. Noyer provides us a nice addition to your brilliant #141004 post from this morning ! Flatliner (1/30/06; 13:01:50MT - usagold.com msg#: 141013) VAT inquiry Kind forum, If I understand it correctly, Value Added Tax was added to gold back about the time the Nixon took the US off the gold standard. It seems to me, that this was enacted to make gold a commodity rather then money. Now as we seen VAT taxes reduced and removed, it seems to state that countries that remove VAT on gold are leaning towards using gold as money again. Is that how this forum sees this VAT move? At the same time, the article posted below does not say by how much Russia will reduce its VAT on gold. Has anyone discovered this percentage?I wonder if we'll ever see a move like this in the US? Topaz (1/30/06; 11:21:00MT - usagold.com msg#: 141012) alt-Gold http://www.futuresource.com/charts/charts.jsp?s=GC&o=100/DX&a=D&z=610x300&d=LOW&b=LINE&st= As anticipated, we're beginning to see the divergence in Gold/Currencies as we approach this Gold delivery month.A strong "blue up-green down" indicating both Gold and Buck in an upswing looks a sure thing imo.Curiously though the Comex delivery notice for today hasn't updated and with (futures) 71k OI left from Friday, could augur well for an eye-popping revelation. 968 (1/30/06; 10:35:26MT - usagold.com msg#: 141011) Russian president supports VAT reduction on gold ingots purchases http://en.rian.ru/russia/20051122/42177165.html MAGADAN, November 22 (RIA Novosti) - Russian President Vladimir Putin said Tuesday he supported a proposal to cut the VAT on purchases of gold ingots (up to 1 kg) by Russians. "Tax cuts, primarily VAT, for Russian citizens who purchase precious metals and invest in them are worth considering," Putin said in response to a proposal made by Russia's Polyus gold mining company. Polyus President Yevgeny Ivanov said gold could become an alternative investment tool for Russians together with the U.S. dollar and the euro. But, the 20% VAT on ingots purchases still stands in the way, he added. Putin has also supported Ivanov's proposal to issue licenses for mining companies allowing them to work on foreign markets.----------------------------------------------------------------------------------------------------------------------Randy, I think this will sound like music in your ears... Goldilox (1/30/06; 09:22:52MT - usagold.com msg#: 141010) Let the Good Times average out nicely http://www.prudentbear.com/randomwalk.asp snip:On average, things are looking good. Just ask Larry Kudlow, the pundit who thinks the economy is so good that he wondered if the Vice President of the United States agreed with him. So Mr. Kudlow fired this question at the V.P.: "Isn't the economy kind of an underrated story?" That's the sort of hard-hitting question that a famous supply-side television personality is paid to ask. Never one to be caught off guard, the V.P. admitted that, in his view, the economy did just fine last year. "… I think any objective observer will say that 2005 was a very good year for the economy, in spite of things like Katrina," the V.P. said. Last year was a very good year indeed. Take home prices, the engine behind our New Era economy. In fact, take California home prices, the turbo charger on the newfangled engine. In fact, take the number of homes in California that sold for more than $1 million last year, and this is what you get: You get 48,666 million dollar homes. That's 47% more million dollar homes sold in 2005 than in 2004, according to the Los Angeles Times. For the record, 48,666 million dollar transactions comes to 1 in 13 California home sales achieving status as a million dollar deal. That's a nice ratio. And that ratio compares to "just" 1 in 20 in 2004. And that compares to 1 in 2, which is the ratio of Californians who want to quit their jobs to become real estate agents once they do the math on the commission involved in a million dollar transaction. A multitude of million dollar home sales is an amazing thing. The only thing more amazing than the number of million dollar homes in California is what you get for that kind of money. According to DataQuick's numbers quoted in the article, a million dollars in California will get you four bedrooms and 2,480 square feet, assuming you spring for the median million dollar home. Now 2,480 square feet is a fine sized home, but it wasn't that long ago that for a million bucks you could get another couple of thousand feet and a butler. Not only that, in California a million dollars won't always get you a yard and a garage for your surf board. The LA Times notes that there were 2,902 condo sales in the $1 million or more category last year, up a smart 73% from 2004. Sure, California real estate is hot, but homes are hot nationwide. Apparently there are one million homes around the country now worth at least $1 million. That compares to only 350,000 as recently as 2000. But even if a million dollars won't get you the mansion it used to, it's a darn dynamic economy that can conjure up so many million dollar homeowners so quickly. And it is just that kind of financial dynamism that has created the payday lending industry. Unlike mortgage lenders, who loan out hundreds of thousands of dollars, payday lending involves small advances to the cash-pinched until payday. Because it usually costs the borrower about $15 to borrow $100 for two weeks, the interest rate on these things can top 300%. Despite a long string of positive GDP numbers, and the record number of million dollar homes, the demand for payday loans is booming. Ace Cash Express, one the industry's biggest players, saw its loan fees and interest jump 19% in fiscal ’05. In December the company opened its 1,500th store, up from 1,230 as of June ’04. For the record, cash squeezed Americans can find 25,000 payday lending locations across the country (up 3,000 since 2002). The number of stores continues to sprout like ear hair on a middle-aged man. But payday loans aren't made to just anyone. You can't just be desperate--you also need a checkbook. That's because the borrower gets the loan in exchange for a post-dated check that includes the fee. Because payday borrowers must have checking accounts, they fall into a higher income bracket than might be expected. Ace Cash Express says that 47% of its borrowers make between $24,000 and $50,000. Another 13% make more than $50,000. Whatever the income bracket, lots of people are taking out payday loans. According to a University of Massachusetts at Amherst study last year, the payday loan industry dispersed $40 billion in short-term loans in 2004. Although much of it may have been paid back during the year, that's an impress slug of desperation borrowing, particularly compared to the $29 billion increase in revolving credit that year. With all those desperate borrowers, is the economy really as underrated a story as Kudlow believes? The President thinks so. In last Saturday's radio address, the President agreed with Kudlow and the V.P., declaring that "Thanks to tax relief, spending restraint and the hard work of America's entrepreneurs and workers, our economy today is strong." While the use of such words as "spending restraint" in the wake of a budget cycle that gave us the "Alaskan Bridge To Nowhere" is interesting at best, it appears that three very important people all agree the economy is doing just fine. On average, who wouldn't?-GoldiloxAuto manufacturer and government give-aways, ballistic RE equity rises, and a ballooning usury market! Now that's a GREAT economy! Oh don't forget the Wall St $Million bonuses for maintaining the SM indexes at zero-growth for the last three years. It helps skew the numbers so wages appear to be "up". Not to mention that casinos that are popping up like mushrooms where the penguins and scantily clad cocktail waitresses toil for minimum wage plus "tips". Goldilox (1/30/06; 09:03:54MT - usagold.com msg#: 141009) GDP "Spin" http://www.jsmineset.com/ snip:The newest spin is to label any negative economic event as a "Rear View Mirror Event." As a result, the disappointing GDP number, which was expected to be 4% but came in at 1.1%, was instantly dissmissed, with the talking heads immediately asserting that blue skies were on the horizon. The street talk was that this poor performance was related to hurricane Katrina and was therefore irrelevant. You'd think the spinners would be more creative and come up with a new excuse because this one has been flogged to death in recent months.Looking at the numbers reveals that the poor performance of the GDP report is from sick auto sales, declining exports and less military spending. Do you really expect better auto sales after the give away deals sapped up auto demand?The US Trade balance shows no REAL improvement so you can write that off too. More war is certainly possible as Iran thumbs its nose at the US and EU. Increasingly, Iran is being seen as a rogue nation and global support for military action is growing.So how can you spin hurricane Katrina in terms of the disappointing GDP number? Yet the equity market forges ahead confounding the bears who fail to understand the power of the black box in a world that is swimming in liquidity. It is not what is being injected today but was has been injected by Professor Bernanke in the past that has no practical ability to be drained.Today, two new governors were appointed to the Federal Reserve. Both are out of the White house staff. Now do you really believe that Professor Bernanke is going to be the great inflation fighter, having been in the employ of the White house prior to his appointment? Assuming that the GDP will not make any significant improvement from its present level, you can be sure interest rate hikes will stop and in time the Fed will move to more non-traditional methods of pumping the hell out of liquidity so that history does not write this administration out of the texbooks.-GoldiloxWith Supremes nominees and FED Governors coming directly from White House Staff, one might notice the scent of "desperation" in the NeoCon camp. Can't they find qualified candidates with slightly longer "leashes", or has their credibility been completely eroded in officialDUM?As goes "full faith", so goes the US $. Our greatest tourist attractions this year will be Niagara Falls, Yosemite Falls, and USDX Bernanke Falls. Now, if foreign touristas can just get past HSA to spend some of their rising alt currencies here - maybe they should pose as "construction workers" at the border. Goldilox (1/30/06; 08:44:11MT - usagold.com msg#: 141008) Iran wants OPEC to cut oil output http://www.radionz.co.nz/news/bulletins/radionz/200601301349/dd6157 snip:Giant oil producer Saudi Arabia says there is "absolutely" no reason for production to be cut - but this view is opposed by Iran.The Organisation of Petroleum Exporting Countries (OPEC) is meeting tomorrow at a time of stubbornly high oil prices, fuelled by instability fears in Iran and Nigeria.A majority of the 11-member cartel, which pumps about 40% of the world's crude oil, has already indicated a desire to keep the output ceiling at a near 25-year high of 28 million barrels per day for now.Only Iran, the fourth largest oil exporter in the world, has spoken in favour of trimming output.Analysts say that stance may be linked to a desire by Iran to use its energy weapon against the West amid a standoff with the European Union and the United States over the country's nuclear programme.-GoldiloxYa think? mikal (1/30/06; 07:41:21MT - usagold.com msg#: 141007) Smaller gold buyers highly motivated http://www.tradearabia.com/tanews/newsdetails_snRET_article99882_cnt.html Gold retains glitter despite record prices - January 30, 2006 Some good points made about incentives to buy gold. TownCrier (1/30/06; 06:59:07MT - usagold.com msg#: 141006) DMCC Discusses Cooperation with Japanese Delegation http://wam.org.ae/NASApp/cs/ContentServer?GXHC_JSESSIONID=8fe311a76a6ad053&pagename=WAM%2FWamLocEnews%2FW-T-LEN-FullNews&c=WamLocEnews&cid=1138369071697&p=1041248621847 Dubai, Jan. 20th, 2006 (WAM): The Dubai Metals and Commodities Centre (DMCC) today hosted a trade delegation from the Tokyo Commodities exchange (TOCOM)."The DMCC's strategic location at the cross roads of the East and the West has ideally positioned it to be the gateway to the vast emerging commodities markets in the MENA region and the sub-continent and this visit from the Tokyo Commodities Exchange (TOCOM) is a significant indication of the international interest Dubai is generating across the world as a trading centre for commodities," said Dr. David Rutledge, CEO of DMCC."We are honoured to host this high profile delegation today, as it is in keeping with our objective to strengthen relations with international commodities exchange centres. We look forward to working closely with TOCOM to identify areas of common interest and hence further drive the international trade in commodities to greater heights," he said.^---(from url)---^R. TownCrier (1/30/06; 06:36:59MT - usagold.com msg#: 141005) 968, Kazakh reserves Straightforward thoughts are that here we have yet Another example of country having a reserve policy moving in the right direction.Of course, I'm sure there will be no lack of traditional money-watchers who will remain bewildered, wondering why the National Bank would choose more gold instead of more of the same old U.S. IOUs.R. TownCrier (1/30/06; 05:16:38MT - usagold.com msg#: 141004) A special 'Belgian' tribute -- The EUROPEAN insight A person's environment and social context can very often provide the basis of perception of the world at large. Based on the particular environment under question, a group of persons can either be generally blinded to certain issue, or alternatively they can be in possession of keen insights into those same issues as though it were second nature. Monetarily, due to the complete dominance of the dollar on the domestic scene, many Americans simply cannot see past their own noses, as the almighty dollar-lenses miraculously filter everything else out. In Europe, by contrast, the monetary history of localized hyperinflations and the prior feature that each nearby state had its own unique currency has contributed to eagle-eyed awareness of monetary issues not shared by the typical American investor.A good example of this was provided by Belgian professor Herman Van der Wee, where, in one of his many publications, he stated a point quite matter-of-factly in a mere footnote to a discussion of the evolution toward a new monetary system. [Skip ahead, or else please read this completely through for vital context.] In this particular discussion he was addressing the state of affairs as they currently were in the early years of the 1980's, the time of the publication I am referring to. Now, picking up at a point over 500 pages into the discussion Van der Wee said:"... As far as exchange rates are concerned, many people still believe that the solution lies in a further strengthening of the system of manages floating parities. This would assume increasing intervention on the international exchange market. ... According to official American thinking in January 1979, the newly broadened IMF, now with supervisory competence, would be able to have an innovatory impact in this area."...The development of a new international monetary order also implies a satisfactory solution for the problem of world reserves. In the first place this requires the reorganization of the de facto dollar standard: THE HUGE DOLLAR BALANCES HAVE TO BE ELIMINATED."They could be converted into SDRs or into other currencies that could be promoted into new reserve currencies, such as the mark, the yen, the Swiss franc or the ECU. Nevertheless, WITHOUT ATTENDANT REFORMS, THE IDEA OF CONVERSION INTO THOSE OTHER CURRENCIES IS NOT TENABLE."In essence it would only be a holding operation BECAUSE OTHER CURRENCIES TOO CAN BECOME THE SUBJECT OF UNCERTAINTY OR IRRITATION."Worse still, it would mean the reintroduction of a system of multiple, mutually convertible reserve currencies and all the dangers of speculation that accompany this."At the time of writing [c. 1983] the ECU was still too weak to be of much significance in the short and even medium term."Conversion into SDRs is, for the moment, an unrealistic proposition as well. ...no solution to the dollar glut could be expected from this quarter."There is an even more fundamental problem. The liquidation of dollar balances will ultimately have to take place via a considerable rise in the exports of American goods and services. Given the difficult economic climate of the early 1980s this would lead to much economic friction. Opposite the irritation resulting from the hegemony of the de facto dollar standard stands THE FRICTION THAT WOULD BE CREATED BY THE LIQUIDATION OF EXCESSIVE DOLLAR BALANCES, AND THESE TWO PROBLEMS CANNOT BE SOLVED SIMULTANEOUSLY."According to some experts, a general and operational solution could only be found in a gradual expansion of the authority and functions of the IMF. ...the IMF, as clearing union, would be able to organize the distribution of available liquidity on a multilateral and systemic basis. Between 1978 and 1980 the United States government more or less supported this idea, as appears from its consent to the creation of new SDRs... [however] the double problem of the dollar overhang and the de facto dollar standard would not be immediately resolved by this, but it is clear that liquidation would be both quicker and safer under IMF management than otherwise."Alongside exchange rates and world reserves, capital movements must also be subjected to more efficient international control. ... Indeed, attention is regularly drawn to the inflationary effects of speculative capital flows. In this, the Eurocurrency market is singled out, because the lack of any control there fosters credit creation and thus energizes inflation."The United States has wanted to exercise supervision over international capital flows, especially the Eurocurrency market, but at the minimum level necessary... it stressed the useful role that the Eurocurrency market played in recycling the petrodollars and the economic necessity of siphoning capital to regions and sectors where higher productivity gains could be realized. Again, reference was made to the new surveillance capacity the IMF possessed from 1978 onwards. [Randy's comment: note how that legacy of U.S. policy makers is now drawn in stark contrast with the modern viewpoint as expressed by ECB's president Trichet and others as spelled out in today's TownCrier news post (msg# 141000) with the headline "DAVOS -- Poor funding of rich seen as unsustainable, risky"]"The development of the international monetary system after the IMF Second Amendment on 1 April 1978 showed a definite trend towards the strengthening of IMF authority. ...Through persuasion and flexibility the IMF attempted to strengthen its authority over monetary policy in the world."This was also clearly evident in the new discussion on gold. In 1980 and 1981 several proposals were made to the American Congress which, as a means of fighting inflation, sought to reestablish the role of gold in American monetary policy."A study commission, chaired by the Treasury Secretary, was set up to explore the possibilities. Its results, however, were negative and the IMF policy to demonetize gold must have had an influence."The promotion of the IMF to an institution with effective supranational authority to provide the basis for the management of a new monetary world order can be seen as the logical end-point of post-war international monetary development. The system of a stringent code of behaviour and rigid exchange rates that was established after Bretton Woods inevitably had to give way as soon as THERE WAS NO LEADER LEFT TO IMPOSE THE RULES UPON ITSELF AND ITS PARTNERS."The collapse of gold convertibility in 1971 and the introduction of a system of extreme flexibility made necessary corrections in the short term; but in the long term they introduced instability and uncertainty. To counter this by supplementing the free floating exchange rates with a policy of complete national autarky would be irresponsible. The world economy has become so complex and interdependent that a policy of national autarky would imply a dismal loss of efficiency and world solidarity -- an unacceptable regression. ... The only rational solution thus *appears* to be an ordering of the world economy by means of a supranational monetary body invested with effective authority."However correct this reasoning may appear to be at first sight, there are two major drawbacks."The first drawback is a theoretical one; it relates to the problem of diminishing returns that is inherent in any cycle of organizational or technological progress. ...further growth would bring increasing complexity and interdependence. ... At a certain point in the development of this supranational body, bureaucratic sclerosis would therefore undermine any progress made in efficiency and equity."The second objection to a muscular regulatory authority is of a practical nature. ...on a world scale, between national autarky and strong supranational authority THERE LIES THE REALITY OF LARGE POLITICAL AND ECONOMIC POWER GROUPS. (United States, Canada, the EEC and associated countries, Japan, Soviet Union, etc) ...In the first place, these existing power groups might not accept a transfer of effective power to the supranational monetary authority. The world would then disintegrate into several large, powerful, autarkic, political and economic blocs with all the attendant dangers of mutual conflict. The developments of recent years undoubtedly show tendencies in this direction."In this scenario, of course, the supranational authority is quickly short-circuited. But even if the continental blocs joined in a decision to start co-operating within the framework of a strong supranational body -- say the IMF -- in the context of the present balance of power such co-operation is only conceivable if each bloc has a right of veto over all important IMF decisions. Under these conditions the authority of the IMF would only be operational TO THE EXTENT THAT COMMON GROUND COULD BE DISCOVERED BETWEEN THE VARIOUS POWER GROUPS."As the world now appears, CONSENSUS EXISTS ON ONLY A VERY LIMITED NUMBER OF FUNDAMENTAL POINTS."[And it is at this point where Van der Wee tellingly injects the following matter-of-fact footnote regarding the available consensus on few fundamental points.]"For example, convertibility between the various currencies in principle presents no problem but the question of what level or rate to use will always be a source of contention. Gold convertibility will remain suspended BUT EUROPEAN GOVERNMENTS WILL NEVER WILLINGLY ACCEPT A COMPLETE DEMONETARIZATION OF GOLD."In Europe there will always be reservations regarding the holding of too large a share of total reserves in the form of dollars or SDRs since there is skepticism over the success of international co-operation. If this co-operation FOR ANY REASON should break down and the IMF prove unmanageable then SDRs will no longer be usable. No more need be said of the European distrust of the dollar. [Confer 1971.] The nostalgia for GOLD AS THE ULTIMATE RESERVE VALUE will therefore never totally disappear."Randy's wrapup comments: And as easy confirmation that that remains the case these 20 years later, we need look no further than the first bullet-point of the European 1999 Central Bank Gold Agreement in which 15 European central banks affirmed, among other things supportive to the euro-system framework, that "1. Gold will remain an important element of global monetary reserves."Now it is important to revisit an earlier comment by prof Van der Wee, he had said "The development of a new international monetary order also implies a satisfactory solution for the problem of world reserves. In the first place this requires the reorganization of the de facto dollar standard: THE HUGE DOLLAR BALANCES HAVE TO BE ELIMINATED. ... At the time of writing [c. 1983] the ECU was still too weak to be of much significance in the short and even medium term."At this time, the European Currency Unit (ECU) has become more fully fledged into the euro of the EMU, and the supportive European System of Central Banks. Additionally, as the Europeans have been active in the redistribution of gold to further build the coalition of other international central banks who can reach consensus upon and make practical use of gold as the ultimate reserve value, it appears quite clear that we have surmounted the "short and even medium term" period of impotence, and the time is now at hand that the articulated changes are now happening in the international reserve structure in (re)defining the world monetary order.Randy White Rose (1/30/06; 04:54:50MT - usagold.com msg#: 141003) Billionarie meets Peak Oil and www.dieoff.org http://money.cnn.com/magazines/fortune/fortune_archive/2005/12/26/8364646/ I bout the "special issue" Fortune Magazine with gold bars and the words "Invester's Guide 2006" on the cover.Inside is an interesting article about Mr. Rainwater. Check out the issue on the news stands, since the sidebars and the photos make it much more dramatic than the web link (which just has the text of the basic article).There is a sidebar in the physical magazine listing good web sites including www.dieoff.org.I never thought I would see that in a mainstream publication. 968 (1/30/06; 03:46:16MT - usagold.com msg#: 141002) Gold in Kazakh reserves grows to 14% in 2005 http://www.tmcnet.com/usubmit/2006/01/27/1321991.htm SNIPS :"The amount of gold in the Kazakh National Bank's net gold and foreign currency reserves grew 13.9% to 61.7 tonnes for a total of $985.5 million by the end of 2005, National Bank Chairman Anvar Saidenov told Interfax.""The National Bank bought 2.5 tonnes of gold from the Kazakh companies Altynalmas and Vasilkovskoye Zoloto in 2005, Saidenov said."------------------------------------------------------------------------------------------------------------------------Towncrier, any thoughts on this one ? TownCrier (1/30/06; 03:03:58MT - usagold.com msg#: 141001) DAVOS-Leaders told: Fix the economy's gaps as sun shines http://yahoo.reuters.com/financeQuoteCompanyNewsArticle.jhtml?duid=mtfh14628_2006-01-29_11-44-18_l28381184_newsml DAVOS, Jan 29 (Reuters) - While the sun appears to shine on the world's economy, influential voices at the Davos summit warned its leaders to make essential repairs now in case of storms ahead."We live in a moment where everything is good," IMF Managing Director Rodrigo Rato said."Liquidity is substantial, interest rates are benign, risk premia are benign. But this might give complacency to policymakers, and that certainly is a risk."There was a nagging undercurrent that good times can't keep on rolling. But no one was quite sure what would go wrong."There is a dangerous degree of complacency, and out of that comes a surprise that does the most damage to the global economy," said Stephen Roach, chief economist of Morgan Stanley.Larry Summers, head of Harvard University and former U.S. Treasury Secretary, was not convinced that the danger of major economic disruptions had passed.He compared the situation to waiting for a bus that never comes. Eventually it comes when people least expect it."The situation in the next couple of years will be a complex one and will require rather more policy coordination than we have seen," Summers said.Currently, the U.S. sucks in 70 percent of excess global savings, something that European Central Bank President Jean-Claude Trichet called abnormal. Indian Finance Minister Palaniappan Chidambaram said it robbed poor countries of capital they needed to improve their standards of living at home....Given the risks, economists and policymakers said the best thing to do is to patch up the holes in the way the global economy works so that it is in healthy shape.First on the list is to raise the U.S. savings rate as the American growth machine slows down, so the U.S. is less reliant on foreign capital to finance its spendthrift ways.^---(from url)---^To help you through any disruptive devaluations ahead, act today while the sun shines and choose the only avenue of savings which always is "good as gold".R. TownCrier (1/30/06; 02:46:42MT - usagold.com msg#: 141000) DAVOS-UPDATE 1-Poor funding of rich seen as unsustainable, risky http://yahoo.reuters.com/financeQuoteCompanyNewsArticle.jhtml?duid=mtfh01352_2006-01-28_10-17-54_l28241517_newsml DAVOS, Switzerland, Jan 28 (Reuters) - Massive flows of capital from the emerging to the developed world are unsustainable and risk damaging poorer countries as they try to catch up, leading finance officials said on Saturday.Speaking at the World Economic Forum in Davos, European Central Bank President Jean-Claude Trichet said that the current global investment pattern was "profoundly abnormal" and in no country's interest.Trichet said Europe could not be expected to play a major role in correcting global imbalances, adding that without an inflow of petro-dollars in the wake of soaring oil prices, real rates could be a lot higher."The enormous additional pot of savings that has been accumulated by the oil exporting countries (as oil prices have risen)... has apparently a good influence on the financial market (but) it has, of course, a very depressing influence on the economy as a whole," he said.There are some concerns on the bond market ... that China is losing some of its appetite for Treasuries.Indian Finance Minister Palaniappan Chidambaram said he expected flows from China would change as local consumption grew.The danger to the world economy is that when the inflows eventually dry up there could be sharp economic amd market dislocations."There are potential triggers that could create serious consequences for the global economy. The first is a southward movement of the dollar, the second is an unexpected increase in U.S. interest rates ... Thirdly, (a spiral in) energy prices... will lead to inflationary expectations," Chidambaram said.^---(from url)---^Choose coins and bullion. After all, only gold (metal) is always "as good as gold". Anything else (i.e., derivative) is just a default that's waiting to happen.R. Goldilox (1/30/06; 00:45:33MT - usagold.com msg#: 140999) Bells ringing for silver ETF http://www.marketwatch.com/news/story.asp?guid=%7B9E4F204C%2DFD45%2D40D4%2DB648%2DAD5953F5264D%7D&;siteid=mktw snip:BOSTON (MarketWatch) -- Silver futures touched a19-year high last week on news that a long-awaited silver exchange-traded fund was a step closer to market. Yet a group representing the metal's users is intent on blocking the fund's launch.Speculation ran high that the silver ETF in registration could soon begin trading, as the Securities and Exchange Commission opened a 21-day comment period on the proposed fund."There has been some movement on the silver ETF," said Christine Hudacko, a spokeswoman for Barclays Global Investors, which filed for the product last June. But Hudacko said the firm can't predict when the fund may be introduced."The SEC has not made the filing effective, which is what everyone is waiting for," she said. The comment period is "standard procedure" for financial products in registration, she added, and the SEC determines the length of the review.The American Stock Exchange has filed to list the silver ETF, which the SEC has indicated it will approve, Hudacko added.Many observers had expected the first silver ETF to trade by now, since it appears similarly structured to a pair of existing gold ETFs.The first gold ETF that began trading in late 2004, StreetTracks Gold Trust (GLD)Facing oppositionLaunched with great fanfare in a bull market for gold, the two ETFs have been popular because they allow investors to hold bullion without paying storage costs. Analysts expect a silver ETF would meet a similar reception.However, the Silver Users Association, a nonprofit lobby group interested in keeping an orderly silver market, has opposed the new fund. The SUA fears the ETF could trigger a price spike in the metal because the fund would need to purchase a large quantity of silver to back its shares before the launch date."A silver ETF would only exaggerate silver's illiquidity given the sheer volume of physical silver needed to be shipped and stored," the group said in a recent letter to the SEC.The SUA, which represents jewelers and companies that use silver for industrial purposes, plans to use the SEC comment period to dispute the silver ETF, according to media reports.-GoldiloxBells may be ringing, but the SUA is calling them "red flags". ViewYesterday's Discussion.
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