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

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ARCHIVED DISCUSSION FROM 7/5/2003
All times are U.S. Mountain Time

(Yesterday's Discussion.)

mikal (07/05/03; 23:38:38MT - usagold.com msg#: 105455)
Will debt servicing survive or emerge unrecognizable?
http://www.lewrockwell.com/orig4/hull2.html
Thugonomics 102: 'Significant Volatility'
Budgets Have Busted, and Bubbles Have Burst
by Shelton Hull -July 5, 2003 -Snippit:
"More families have been broken by money than by alcohol, drugs and maybe even domestic violence, and surely much of that self-destructiveness was spurned by the emasculating effect of debt on mankind.
What do we say to the families that picked up another $668 billion in mortgages last year? What happens when they start to act like CEOs and skip out on their debts en masse? Is there any way of actually enforcing all the debt currently outstanding without basically shutting down the economy? If not, then how is that debt managed without undermining the delicate moral and legal framework upon which the concept of debt is based? These are questions that citizens and our government need to be asking now, while there's time."
# # # # # # # # # # # # # # #
By proposing that the U.S. housing market is in serious trouble, the author shares an increasingly global perspective of economic dysfunction. Observers in America and across the ocean who have remained silent will be forced to attest to the fallout until nothing remains to be said or a solid footing is established.
But if the injust continue to hijack the corporate executive class, banking and financial professions and connive monopolistic and predatory legislation, the vessel of government must first be commandeered.
The problems of inflationary money debasement, official conflicts of interest in political and corporate appointments and gov't contracts and in soft money, vote fraud, ever-broadening tax and job extortion and growing governmental expenditures, bureaucracies, perks and pay raises, etc. produces several hideous tumors that grow to the surface for all to see.
If the majority cannot go beyond merely scratching the surface, then economists, bankers, politicians and corporate managers can receive a clean bill of health only if history's newest diseases remain undetected.

21mabry (07/05/03; 22:08:22MT - usagold.com msg#: 105454)
(No Subject)
Trapper in my last post I did not meen to equate the marines to the army,I know enough marines not to do that,but I did volunteer to be a ground pounder in the infantry so I am not to soft.21

21mabry (07/05/03; 21:45:28MT - usagold.com msg#: 105453)
Trapper
I know a few and I think I know what you are saying.But I have heard many veterans say those who want war have never seen war.21 P.S. I was almost in the army myself but was cut loose because of hypertension. So I am not anti military.

21mabry (07/05/03; 21:42:07MT - usagold.com msg#: 105452)
Barter
There is an interesting article in the asian times.China and India are building high speed rail lines for Malayasia and both countries are being paid in palm oil for the work.21

Trapper (07/05/03; 21:39:45MT - usagold.com msg#: 105451)
Sir 21 mabry
From your comment on the Marine coach and his desire for war I can surmise that you don't know many Marines. It was like old home week at the recuiters office when the first Gulf war broke out. Semper Fi, and live small.

R Powell (07/05/03; 19:14:52MT - usagold.com msg#: 105450)
Correction
I checked again and found that it is copper and zinc that may be produced with new processing methods that do not recover silver. Again, this is from a good source but not to my way of thinking, substantiated yet. Can anyone add any information here?

I'm also curious enough to repeat the request for any information about the contents of a Smith-Barney advisory about silver. Other than it being favorable toward silver, nothing else was mentioned.

I'm disappointed with those who charge for information and deliver only vague references or the most general of statements without citing any references. I guess when payment is required for the information that we freely share here among ourselves, I hold the paid provider to a higher standard of performance and accountability. I would prefer that if one is going to spout out only bits and pieces of news that these be accompanied by some references or, at least, attributed to a source. Let the reader investigate further if so inclined or let the reader evaluate the information along with it's source. If we can not verify the information, at least give us a clue as to it's source. Let us know whether it came from the townhall, the town bar, the local beauty salon or the town gadfly.

In keeping with this rant, thanks again to glennh10 for the goods (link) verifying cometose's news of silver trading commencing soon in old Shanghai.
Rich

overton (07/05/03; 15:19:03MT - usagold.com msg#: 105449)
Smith Barney Silver Report
?/curious if anyone has seen a copy of the 8 page SB silver that David Morgan in his July newsletter said was mailed to Smith Barney clients. Its not too often a major brokeratge house puts out a silver report.
its like its top secret ..........

Dollar Bill (07/05/03; 15:04:38MT - usagold.com msg#: 105448)
(:->)
From the BIS link;
"Thus, the collected Princes of Paper and Kaisers of Credit pretty much endorsed all the recent Federal Reserve-propagated craziness about administering the whole pharmacopoeia of quack remedies to any(???) economy so afflicted – among them the accelerated reduction of interest rates **for those so able**; to be followed by the monetization firstly of government securities, then of those issued by other entities, and, lastly, of real assets if necessary; this to be coupled with morally hazardous guarantees of support for the financial firms which comprise the central banks’ cartel; the avowal of cast- iron assurances as to the extended duration of all such policies; and the possible adoption of rising price level, rather than just inflation, targets."

Does this imply that many countries will now adopt the Fed
measures? Can other countries do it? It is a matter of how much of thier currency is part of global trade? Since the US is just printing up dollars to buy its own debt, is the BIS now stretching the bounds for other countries to break rules as well?
What does "for those so able" mean?





Old Yeller (7/5/03; 14:32:01MT - usagold.com msg#: 105447)
Sean Corrigan
http://www.safehaven.com/Editorials/corrigan2/070403.htm

Good thoughts on the BIS(Bank of International Sorcerers?)
meeting and reading between the lines of official soundbites
and pronouncements.

R Powell (7/5/03; 14:08:45MT - usagold.com msg#: 105446)
Commodities below production costs
Mabry21: Silver is not unique as a commodity selling at prices below that of it's production. Whenever cotton is below about $0.50 per pound or sugar below 4-6 cents per pound they are selling below production costs. Many grains' selling prices are also below the true (unsubsidized) costs of production during some time periods in their marketing year. Government programs insure that the big agribusinesses will not go broke even though the number of small family farming operations has been decreasing for many years.
In the case of silver, most of the by-product production is simply sold at whatever the current market price with the proceeds used to lower the cost of production of the mine's primary product. There are rumors (imho, any unsubstantiated information from any source, no matter how reliable that source) that new mining procedures may produce lead and zinc without also refining the silver from the ore. I can only guess that the lowered costs of the new procedure outweigh the monetary gains of also taking the silver from the ore. Maybe Black Blade will read this and comment on it?
Rich

21mabry (7/5/03; 13:16:33MT - usagold.com msg#: 105445)
SILVER
Thnx MAX, Its wild when you can buy the finished product cheaper than it costs to make it.That should tell us something right there,when we can go on the market and buy silver cheaper than it costs most miners to mine it wow.Can we buy corn flakes cheaper than there production price,is there any products or commodities out there that continually sell for less than there cost of production, if we believe the info out there silver and gold have sold below there production cost for years.That means in some way they have been subsidized and if those subsidies are removed they should move to equilbrium price levels,an initial spike then in the long term steady price,lets all catch the initial rocket launch.

Max Rabbitz (7/5/03; 13:02:39MT - usagold.com msg#: 105444)
Mabry
1) Most silver is produced as a by-product of other mining.

2) Most silver mines are not profitable at this price.

3) Mines are subject to politics, taxes, regulations, labor negotiations, power prices, and ore depletion.

4) I guess he didn't want to take such a big risk although Soros and Gates have invested in mines. I believe Soros has invested in a great property that will be brought into production when silver prices rise.


Max

mikal (7/5/03; 11:41:06MT - usagold.com msg#: 105443)
Currencies, bonds and trade
http://abcnews.go.com/wire/Business/reuters20030705_67.html
EU Pressures Asia to Allow Currency Rise -July 5, 2003
— By Jason Szep BALI, Indonesia (Reuters)
Snippits: "European finance ministers pressured Asian governments on Saturday to allow the region's tightly managed currencies to rise against the dollar, a move that may limit any damage to Europe's economy from further euro strength.....
The weekend Bali gathering of officials from the European Union, China, Japan and other Asian nations is also expected to stress closer coordination in macro-economic policy between their regions, home to about a third of the world's population.
"European countries are entering into an integrated single market, while we have just started to strengthen our bond market. There will be talks on how to synergise these efforts," said Indonesia's chief economics minister, Dorodjatun Kuntjoro-Jakti.""
* * * * * * * * * * * * * * * * * *
A very detailed and intriguing discussion of the advantages and disadvantages of current and proposed currency pegs and valuations globally. And some insight into the tight peg of the Chinese, Malaysian and Hong Kong currencies to the U.S. dollar.
Indicates bond and currency market realignments must continue as adjustments are made to trade and policy. At least they'll have to appear to sort things out, or what they can while the markets do their thing. Reactive policy versus proactive and overregulation versus moderation- for a continuation of the status quo of unlimited government, growth and profits as the key to progress, quality of life, peace, GDP, standard of living, etc.!

slingshot (7/5/03; 10:28:55MT - usagold.com msg#: 105442)
Holiday Experience
Cometose
Hope all had a nice and safe Holiday. We had one incident that was close. As we set off some major fireworks, a small crowd gathered to watch. We had our safety zone and the one time we did not adhere to, it happened. We set off an aerial mortar that climbs to 150+ and bursts into brilliant and colorful designs. This time standing inside the unsafe zone thinking it was on its way up, this baby rose about 30 ft and let loose. There was no time to do anything as the boom and showering sparks engulfed us all.Now the funny part is the color of the burst. Gold and Silver. The two seconds or less all I could say is WOW! Nobody was hurt. Not a burn or scratch. Counted my blessings and retired for the night. If only the POG and POS would explode like that.
Slingshot------------------<>

21mabry (7/5/03; 10:16:16MT - usagold.com msg#: 105441)
(No Subject)
If anyone goes to a movie watch the previews the army is running a video before the movies its a slick psych ops production to influence young minds to join. I have nothing against military service but lets give real choices to people.Show some body bags being zipped up'show a vet at the VA clinic whose benefits have been cut and cant get the treatment he needs.Lets show it how it is.The military is a necessity we had a marine who taught phys ed in high school he was still in the corps. and was supplementing his income, he was kinda a jerk he said he prayed for war so he could fight, what a sick mind well I guess he got his prayer answered. Over the last couple of weeks the mining stocks have done pretty well I am still trying to figure if they move like the stock market or if the gold price is there catalyst.One thought if you are a wealthy person and want to take delivery of mega amounts of metal instead of playing the comex game why not buy an operating mine and just keep the metal produced.Why didnt Buffet just buy a mine.He spent a billion for metal plus he has to store it.Maybe someone could tell me why owning a mine was not his choice.21

Chris Powell (7/5/03; 10:11:32MT - usagold.com msg#: 105440)
New commentary by Reg Howe
http://groups.yahoo.com/group/gata/message/1574
GATA's Reg Howe asks whether today's Americans
soon will learn what their revolutionary ancestors did
about the risks of paper money.


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

gata-subscribe@yahoogroups.com

cyberbat (7/5/03; 10:09:35MT - usagold.com msg#: 105439)
economic scare fact of the day
yesterday - Beverly A. Carroll-staff writer
"Homeowners facing record property losses"
Property foreclosures in Hamilton county rose 36% from 2001 to 2002 and are on track for another high year in 2003, county records show.
The local increase mirrors a national trend, according to the Mortgage Bankers Association of America. A record number of Americans faced losing their homes in the 1st quarter of this year, compared to the same period last year, according to the association.
"We are getting some economic growth but it's not fast enough," said Bill Fox, director of the University of Tennessee's Center for Business and Economic Research. "What has NOT been happening is the creation of jobs---------etc"
My gold, my guns, this forum; Wealth, security, and information. Dear Santa, I want it all.
Cyberbat

21mabry (7/5/03; 09:53:51MT - usagold.com msg#: 105438)
(No Subject)
I think alot of people who thought army green was a safe bet for their future are waking up and realizing that you can get killed in the military.Most people who I know who joined did it for the educational benefit programs they offered and the other benefits health, other insurance,etc, now they realize they are being sent to fight and possibly die its a very sobering thought. Military service guarenties citizenship.

R Powell (7/5/03; 08:58:56MT - usagold.com msg#: 105437)
More exposure for silver
Cometose, thanks for the heads-up on the July 8th date for silver transactions on the Shanghai exchange. I've been watching and waiting for some comfirmation to these rumors. Glennh10 has provided some substantiation with the link. Thanks!! This may or may not set off the silver bull but it certainly won't hurt.
Happy holiday weekend
Rich

The Invisible Hand (7/5/03; 06:16:05MT - usagold.com msg#: 105436)
Boilermaker - Shanghai gold
I should know better than trusting the inside of the back cover of a Lonely Planet Travel Guide ;-}

Dollar Bill (7/5/03; 05:05:32MT - usagold.com msg#: 105435)
(:- I)
found this;
I play basketball with a guy that is in PLM (Petroleum Land Management), he goes out and gets leases from people like me for the independent drillers as well as the majors. He was telling me today that in his recollection, we never had gas prices so high at this time of year. He also said that one of the companies he worked for a couple years ago was buying up $100m worth of leases from El-Paso and when they did the due diligence that the reserve estimates from different PEs were wildly varying. He said one guy would see X another guy 2X and a third guy X/2, all for the same field......

In addition to this, he says that estimated reserves are way over-stated because when a company gets a field they want to value it for as much as they can. Later they re-asses it's size to be 40-50% of the original when they are forced to begin writing it down. However, at the beginning, the estimates are always way too large. Finally, fields are running out of gas, i.e. peaking much faster now than in the past which just says that the quality of the finds isn't really high.

His personal appraisal of the NG and Oil situation is that we are in for higher prices for quite a few more years. He thinks alternate energy might provide some relief but still believes that there is a serious NG problem and that is his business.

Just thought I would toss that out there for those folks convinced we have huge, easy to find supplies, i.e. WhiteBear......




Boilermaker (7/5/03; 05:01:15MT - usagold.com msg#: 105434)
TIH - Shanghai gold
You had me worried but......
Minor correction, 1 troy ounce = 31.1034768 grams

Shanghai gold price = 31.1034768 grams x $11.27778/gr = $350.78

Looks like a small premium to NY gold.

Cheers,
Boilermaker




The Invisible Hand (7/5/03; 04:02:37MT - usagold.com msg#: 105433)
Shanghai gold
Has the free gold market disconnected to the downside?

I don't know anything about silver, but here's one article about gold from the China Daily of May 20, 2003
http://www.china.org.cn/english/BAT/65015.htm
SNIP:
Shanghai Gold Exchange (SGE), China's only gold transaction market, is preparing to allow individuals to trade the metal within the year, sources said.

So the gold market is not yet open to individuals.

A more interest question seems to be the Shanghai POG.
Here's what Dow Jones said on July 01, 2003
http://www.futuresource.com/news/news.asp?story=i4369133298213650496
SNIP:
At 0730 GMT, when Shanghai's spot gold market closed, gold bullion of
99.95% purity was 1.22 yuan higher ($1=CNY8.28) a gram from Monday to end at CNY93.02/gram.
Gold bullion of 99.99% purity was CNY0.93/gram higher from Monday's close to finish at CNY93.38/gram.

Gold was at CNY93.38/gram,
$1=CNY8.28
so how much is CNY 93.38?

CNY1 = $1 / 8.28
CNY 93.38 = $ 93.38 / 8.28 = $ 11,27778 = POG / gram

1 ounce = 28.35 gr
price of one ounce = 28.35 gr X $11.27778 /gr = $ 319.725063

According to the K chart gold was at 0230 New York time on July 01, 2003 somewhere between $347 and $348.

Almost thirty dollars difference.

Why?

Or is there something wrong with my calculations? Is 99.99% purity not enough?

Has the free gold market disconnected to the downside?

Aristotle (7/5/03; 03:11:06MT - usagold.com msg#: 105432)
Cometose: "Believing is NOT wishing......" Weeeellll,,,, alrighty then.
I *believe* I'll *wish* for a horse.

Now we can ride!

Oooooorrrrrrr,,,, perhaps still we can not.

Soooooooooo,,,,, maybe there's more involved than the mere *believing* in something.

Buuuuuut,,,,, to the extent that *belief* count for anything, I *BELIEVE* in one-way streets.

Or to apply a better choice of words, I *understand* how it is possible for the Gold:silver ratio to grow larger without turning back. That is to say, I have seen unbiased the evidence offered by the market to date, and I accept what it is telling me about the future especially when taken in conjunction with the body of structural changes now being fomented on the international monetary scene. Aye, 'ave you 'eard of the euro, Matey? It'll run (and play nicely with others) on wheels of Gold.

Gold. Get you some. --- Aristotle

Cometose (7/5/03; 02:46:23MT - usagold.com msg#: 105431)
SILVER
.........and furthermore......

If I was VINCENT ?? FOX and I had 50 million in dollars that I was purposing to convert into something of VALUE ...I would go looking for Hard ASSEt investments....
I believe SIlver mining is one of MEXICO"S big industries , NO? What better way to improve the economy of MEXICO and increase GDP than to cause a self fullfilling prophecy to come to pass in the way of a RAGING SILVER BULL market.....by taking COMEX SIlver CONTRACTS FOR DELIVERY....

THAT WOULD JUST DOUBLE OR TRIPLE, ??????? VALUES of THE EXISTING MINING COMPANIES NOW IN MEXICO.....those silver hoarders hoards....

I would say that there something extremely subtle and volatile in the SILVER MARKEts based on the fact that the spot price for silver has traded in a narrow range these last two years while silver mining companies have outperformed the GOLD MINING COS. despite an obvious 40% rise in the price of GOLD>....SILVER IS BEING ACCUMULATEd...
after they have all of the mining cos' they want ,,,,they will take the remaining comex silver and there isn't a legal thing anyone can do to stop it.......

I like the company of GEORGE SOROS AND WARREN BUFFETT et AL



Cometose (7/5/03; 02:33:35MT - usagold.com msg#: 105430)
Aristotle
Believing is NOT wishing......

and I believe if I was Warren Buffet or George Soros ,
I WOULD DOUBLE DOWN.......

you know .....as in buying low and selling high.....

Investment is part analysis and part taking the risk....of putting your money where your mouth/analysis is .....After doing one's due diligence .....BELIEVING is the act of STEPPING OUT and taking the risk.....in anticipation of what the data may be saying is an OBVIOUS....coup once the fire gets started.....

The gold to silver price ratio is still 75....which means silver is still way undervalued to GOLD on an historical basis.....rebalancing these markets may be an inevitability of Market forces ........and people of self interest moving in the direction data and analysis of that date lead......

Money should flow to SILVER and to GOLD because they are undervalued in comparison to their paper couterparts which seem to be looking more and more like kindling....



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