Gold Today!
ARCHIVED DISCUSSION FROM 3/6/2003
All times are U.S. Mountain Time
(Yesterday's Discussion.)
DummyANI
(03/06/03; 23:39:04MT - usagold.com msg#: 99047)
@Zhisheng #99043
The size of housing bubbles is very different between Japan and USA. In 1989, a total amount of the Japanese real estates was overestimated more than two-fold of a total amount of the USA. So that more than $10 trillion USD value was lost from Japanese banks. This loss will be never happened in USA.
Today's Nikkei225 was closed at 8144 point. This is 20.9 percent level of its peak. The closed price of BOJ(Bank of Japan) was 45,600Yen/share. This is 6.04 percent level of its peak. This indicates that BOJ lost the management capability. High interest rates directly attack at Gov. bonds of BOJ. I believe that USA has no problems at all. Because USD is a key currency, FED can adopt a printing-press policy very effectively. If BOJ adopts a printing-press policy, Yen will be sky-diving very quickly.
D-Ani.
Waverider
(03/06/03; 23:38:27MT - usagold.com msg#: 99046)
US dollar and POG
Just for fun I ran a correlation coefficient on the US dollar index and POG for the data I have this year from Jan 14 to today (n=36). I did a scatter plot first and the data points were everywhere - it was impossible to visualize a negative linear model let alone plot a trend line. I ran a correlation coefficient and got r at -.26, which suggests a very weak (nil) correlation between the movement in the US dollar index and POG since mid January (meaningless really since there's not even a linear model). And look at the POG:XAU ratio at 5.09 today. TPTB have got to be quaking in their boots - the pressure to keep the POG and the shares down has got to be explosive. I know ya'll got Gold, got seat belts?
Waverider
Black Blade
(03/06/03; 22:38:24MT - usagold.com msg#: 99045)
Asian Markets Tank Hard Tonight
http://quote.yahoo.com/m2?u
Asian markets are awash in red tonight following in US markets footsteps. In the US individual investors simply have walked away from the stock market as continuing low volumes attest. It's not just uncertainty over war and geopolitical tensions but absolutely horrific earnings warnings from companies worldwide. Analysts will be busy writing down earnings estimates so that companies can "beat the street" estimates in the never ending game of "spin the story and fool the investor". It should get quite "interesting" over the next few weeks as the global economy slips off into oblivion.
- Black Blade
ElGordo
(03/06/03; 22:27:58MT - usagold.com msg#: 99044)
Nikkei at 1983 level, breaks 800
Tokyo, March 7 (Bloomberg) -- Japanese stocks fell, driving the Nikkei 225 Stock Average to a 20-year low. Exporters such as Sony Corp. declined after President George W. Bush said the U.S. doesn't need United Nations backing to attack Iraq, heightening concern a war will damp growth in the world's largest economy.
The Nikkei fell 204.94, or 2.5 percent, to 8164.21 as of 1:42 p.m. in Tokyo. The average fell to its lowest intraday level since March 1983. The Topix index fell 17.48, or 2.1 percent, to 798.74. The index fell below 800 for the first time since August 1984.
_____________
I wonder if the DOW could go to its 1983 level?
I thought 900 would trigger a banking crisis but maybe the
banks can just keep surviving.
Zhisheng
(03/06/03; 22:19:30MT - usagold.com msg#: 99043)
The Mark and the Yen [DummyAMI(#99035)]
and perhaps the dollar.
Thanks for the added data DummyANI, and the explanation.---quite graphic! Continual deterioration for a decade seems to indicate either a lack of means to reverse the trend, or lack of a social/political context to implement a solution.
You state that the housing bubble is the fundamental problem in the Japanese banking system. I wonder if that will not become the case in the US? Hitherto the problem has been over-investment in the stock market (now at about 6o per cent of its highs), easy credit (causing mal-investment and over-investment), and more recently a weakening of the dollar. With many real estate loans locked in at quite low rates, I fear that a rise in interest rates (to prevent foreign investments on the dollar from melting away) will explode the housing market and banks will be left with increasing and eventually insupportable non-performing assets. If Japan could not solve the problem after ten years of struggle, will the US do any better?
ProInvidia
(03/06/03; 22:13:02MT - usagold.com msg#: 99042)
Finally broke the ice and decided to test the waters
Saw a message yesterday on how to become a poster yesterday and after almost three years of lurking decided to sign up to post to this fine site. Just returned to the United States after spending 8 years in Japan, and the US economy looks like heaven compared to Japan. Not to say everything is fine here, as I have been reading this site for three years, but in all honesty Japan has been a walking corpse since 1999 and its only a matter time before they pull the whole world down with them.
All the stories about the Japanese waiting outside of the gold shops is true. Saw a little old man walk into a gold shop with a backpack full of yen and walk out and get into a taxi with what looked like at least 15-20 l kilo bars of gold. Have also personally waited in line over two hours to buy gold one afternoon in Tokyo. After CNBC Nikkei lost all their internet advertisers, the main advertisers were Tanaka Kikinzoku and other Gold related investments. Am actually shocked how the news here does not display or rarely talk about the POG. In Japan it was mentioned in every news show and on the financial shows it's price was quoted right after the day's yen-dollar exchange rate. Guess tptb here have too much to loose if price of gold rises and the ptb in Japan have too much to loose if it does and they did not make it an option when their banks fail in April.
Really do see many similarities with the US economic situation and Japan. We are several years behind them with a similar situation of debt overhang will occur. Money becomes so cheap to borrow, but no one will borow or lend because there are limited opportunites to provide a decent return. Waiting for the housing bubble to burst in the US and it will, maybe not this year probably next. Thing to understand here is that it usually does not just implode. It is a long drawn out and painful event. Most of the buying in Japan occured years after the stock market tanked. Probably up to 1993-4. Then a funny thing happened. No one was buying any more as an investment. Then the price started going down, slowly, slowly slowly 5-10% a year. Year after year, 9 years in a row and still to this day 5-10% per year depending on your location.
Might have paid a million for your house ( shoebox ) and still owe 750k, but if you try to sell it, if you are lucky, maybe 350-400k tops. So what happens is you sell it and still owe 350k to the bank. The 2.2% iterest on home loans lessens the pain, but it is still a burden nevertheless. Needless to say, I am renting, with no plans to buy a house for several years to come. All that money on house maintanance etc I save I can put into AU.
Black Blade
(03/06/03; 22:12:59MT - usagold.com msg#: 99041)
SEC Faults Pension Reporting, Wants More 'Reality'
http://quote.bloomberg.com/fgcgi.cgi?ptitle=Top%20Financial%20News&s1=blk&tp=ad_topright_topfin&T=markets_box.ht&s2=ad_right1_topfin&bt=ad_position1_topfin&box=ad_box_all&tag=financial&middle=ad_frame2_topfin&s=APmdGaRTTU0VDIEZh
Snippit:
Washington, March 6 (Bloomberg) -- U.S. Securities and Exchange Commission officials say they're concerned that companies are obscuring their pension losses in federal filings and giving investors incomplete information. ``There was a general lack of informative transparent disclosure,'' says Carol Stacey, chief accountant of the SEC's division of corporation finance. She says she reviewed more then 500 annual reports for 2001 with her staff. ``We strongly encourage companies to remedy this in future filings.'' Companies in the Standard & Poor's 500 Index lost more than $200 billion in the past two years in pension investments without clearly disclosing those losses in SEC filings, according to studies by investment banks Credit Suisse First Boston and UBS Warburg LLC. Over the past five months, 12 companies, including General Motors Corp. and International Business Machines Corp., said they had reduced shareholder equity by $40 billion to account for pension deficits.
Black Blade: I touched on this before. There are going to be some huge losses this year as companies struggle to fund pension plans and many won't be able to. Business is currently lobbying Congress to change the law to let them off the hook at the expense of their employees. "Ugly"
ElGordo
(03/06/03; 22:11:35MT - usagold.com msg#: 99040)
Chavez will not do business with enemies of the state
http://www.reuters.com/newsArticle.jhtml?type=worldNews&storyID=2340646
snip:
CARACAS, Venezuela (Reuters) - Venezuelan President Hugo Chavez on Thursday lifted force majeure on his country's oil exports after an opposition strike and announced a fiercely nationalistic oil strategy that would shut out "enemies of the nation."
-------
Former paratrooper Chavez said the government would revise all of PDVSA's operations, including all of its contracts and investments, to forge a new-look nationalist oil strategy that would seek to put the interests of the country first.
He made clear that private firms which had supported the crippling two-month opposition strike would be not be allowed to participate in the oil industry in the future.
"We cannot continue playing the innocent and keep on handing over strategic areas to enemies of the country," the populist president said.
He singled out a U.S.-controlled technology company, Intesa -- 60 percent owned by Science Applications International Corp. (SAIC) -- which he had previously accused of joining in sabotage of PDVSA's central computer network.
Black Blade
(03/06/03; 21:34:56MT - usagold.com msg#: 99039)
Re: Steady
Somehow I don't think currency is an issue with the North Korean ruler. He is supposedly an old line Stalinist. He takes good care of his friends and military at the expense of his subjects. The people are starving and worked to death while he reportedly has his large porn collection and subjects for his personal enjoyment and benefit. Should the North take over the South he would treat the South Koreans the same way as those in the north and claim anything of value as his own personal property and anything else left over going to his cronies and military. But apparently many in the South want that kind of government. I figure good enough, let them go it alone and deal with it themselves if that's what they want -- it's their country. They obviously don't want our troops there to keep the peace. It sure beats me.
- Black Blade
mikal
(03/06/03; 21:26:10MT - usagold.com msg#: 99038)
Correction
Correct subject line below: "The older kind of REASONING I'm sure is obsolete..."
Maybe a reporter will take this story and run with it: "Fed governor sees no war stimulus." OOPS!
Black Blade
(03/06/03; 21:22:40MT - usagold.com msg#: 99037)
Re: Carl H
This morning Saudi officials said that they cannot produce anymore. Actually they probably could but at some point over production could damage a reservoir so that ultimate maximum production may never be achieved. That is what happened to much of Russian and former Soviet states during the Soviet era. The Saudis have not had any major "Super Giant" discoveries for several decades and they are very cagey about giving any information about production. About 10 years ago the Saudis produced 10.5 million bbl/day at full capacity and today they admit that production has fallen to 9.2 million bbl/day at full capacity. Apparently some reservoirs are in decline and reserves have not been replaced with enough production to make up the difference. This would not be all that surprising as they are also notorious quota cheaters. How much more production capacity do the Saudis have at higher costs? No one but the Saudis know, however, today's admission and recommendation that the world tap their strategic petroleum reserves should be a booming wake up call to governments, the petroleum markets and the oil industry. But we may never really know the whole story here. Some here may remember that I said OPEC was producing at or near capacity even as OPEC was spinning the story that they would "open the spiggots" in case of war. I for one was very skeptical.
Most of their (Saudi) production comes from reservoirs that are over 60 years old. These reservoirs are huge and lifting costs are very cheap (about $2.bbl). That's not to say that other producers on the peninsula have reached peak production. Iraq for example has a lot of virgin ground that may hold potential for increased production. That's why France, Germany, Russia, and China are opposed to war because they have supported Saddam Hussein's terror over the Iraqi people with $billions in loans and for oil concessions. They know that a new government may not look favorably on repaying the loans or the land concessions but would more likely be more favorable to US, UK, Spanish, and Italian interests and those that help them remove Saddam. The opposition to war has absolutely nothing to do with peace and diplomacy but for access to a large source of "cheap oil". The very survival of each player's economy depends on it. Some have aligned themselves with Saddam and others against Saddam. The stakes are obvious.
- Black Blade
mikal
(03/06/03; 21:22:14MT - usagold.com msg#: 99036)
"The older kind of method I'm sure is obsolete..."
http://www.reuters.com
Fed's Gramlich: Iraq Impact 'Imponderable'
By Kevin Krolicki -March 6, 2003
LOS ANGELES (Reuters) -Excerpt: "Federal Reserve Board Governor Edward Gramlich said on Thursday that the impact of a war with Iraq on the U.S. economy was impossible to forecast, calling it a "big imponderable."
While standard economic theory has held that war is generally stimulative, that does not account for a conflict that could drive oil prices higher, shake investor confidence or be carried out in the absence of a major surge in wartime production, Gramlich told a group of business economists in Los Angeles.
"I think the state of play now is that nobody is quite sure whether a war in general or a particular kind of war that you can imagine would be positive for aggregate demand or not," Gramlich said in response to a question. "I think that at this point is a big imponderable. The older kind of reasoning I'm sure is obsolete ... but whether it is totally dead wrong is another question.""
DummyANI
(03/06/03; 21:21:36MT - usagold.com msg#: 99035)
@Zhisheng (03/05/03; 09:18:30MT - usagold.com msg#: 98954)
http://quote.yahoo.co.jp/q?s=8301.q&d=ay
Above link is the stock chart of BOJ (Bank of Japan) for the last ten years between 1993 to 2003. At the upper section, a blue line is the price of BOJ. The top price of BOJ was 755,000 Yen/share at Dec. 08, 1988. The secular bear trend has been started in 1988, until 2003 and into further more futures. I select the price of BOJ as the index of Yen value.
Because the curve of BOJ is monotonously decline, and this decline precisely represents the true value of Yen. Forex Yen is manipulated by CBs, and Forex Yen has been very twisted.
Weimar Mark suffered from the astronomical reparations, but present Japanese Yen has no reparations. So that the time was very severe to Weimar republic, and the decline speed of BOJ is very loose, but the devaluation of BOJ proceeds steady.
At first, Japanese stock market lost more than $4 trillion USD in 1990s.
Next, by the housing bubble, Japanese lost more than $ 10 trillion USD, and this is the fundamental problems in Japanese banking-system. Further, more than 670 trillion Yen Government-bond (equivalent to $5.7 USD) has already been issued, and BOJ bought more than 86 trillion Yen-Government-bond. Gov. bond-share by BOJ is more than 12.8 percent.
According to the following list, the value of Yen(BOJ) has been passed through the instability stage (Phillips In Table 5), and passing through the end-half of disaster stage (Phillips in Table 6). A new desperation stage is creeping in the face of the stock price.
Date Marks to the pound normalized-coeff Date price of BOJ share normalized-oeff.
1920 Dec 258M/P 100(percent) BOJ 1988.Dec.08 755,000Yen 100(percent)
1921 Jan 243M/P 106.17(per) BOJ 1991 Dec 276,000Yen 36.5(per)
1921 Feb 237M/P 108.86(per) BOJ 1992 Nov 191,000Yen 25.3(per)
1921 Mar 244M/P 105.74(per) BOJ 1993 Apr 300,000Yen 39.7(per)
1921 Apr 249M/P 103.61(per) BOJ 1993 Nov 210,000Yen 27.8(per)
1921 May 247M/P 104.45(per) BOJ 1994 Apr 230,000Yen 30.5(per)
1921 Jun 261M/P 098.85(per) BOJ 1994 Nov 170,000Yen 22.5(per)
1921 Jul 278M/P 092.81(per) BOJ 1995 Jul 150,000Yen 19.9(per)
1921 Aug 307M/P 084.04(per) BOJ 1996 Apr 195,000Yen 25.8(per)
1921 Sep 390M/P 066.15(per) BOJ 1996 Sep 160,000Yen 21.2(per)
1921 Oct 582M/P 44.33(per) BOJ 1997 Apr 135,000Yen 17.9(per)
1921 Nov 1,041M/P 24.78(per) BOJ 1997 Nov 100,000Yen 13.2(per)
1921 Dec 794M/P 32.49(per) BOJ 1998 Apr 117,000Yen 15.5(per)
1922 Jan 811M/P 31.81(per) BOJ 1998 Nov 96,000Yen 12.7(per)
1922 Feb 907M/P 28.45(per) BOJ 1999 Apr 125,000Yen 16.5(per)
1922 Mar 1,246M/P 20.71(per) BOJ 1999 Nov 115,000Yen 15.2(per)
1922 Apr 1,285M/P 20.08(per) BOJ 2000 Apr 90,000Yen 11.9(per)
1922 May 1,294M/P 19.94(per) BOJ 2000 Nov 67,000Yen 8.87(per)
1922 Jun 1,410M/P 18.30(per) BOJ 2001 Apr 75,000Yen 9.93(per)
1922 Jul 2,200M/P 11.73(per) BOJ 2001 Nov 58,100Yen 7.70(per)
1922 Aug 5,074M/P 05.08(per) BOJ 2002 Apr 72,500Yen 9.6(per)
1922 Sep 6,502M/P 03.97(per) BOJ 2002 Jul 61,000Yen 8.08(per)
1922 Oct 14,146M/P 01.824(per) BOJ 2002 Nov 50,300Yen 6.66(per)
1922 Nov 32.146M/P 00.8026(per) BOJ 2003 Jan 50,000Yen 6.62(per)
1922 Dec 34,858M/P 00.7401(per) BOJ 2003 Feb 46,000Yen 6.09(per)
1923 Jan 83,190M/P 00.3101(per) BOJ
1923 Feb 130,750M/P 00.1973(per) BOJ
1923 Mar 99,526M/P 00.2592(per) BOJ
Buy a gold, sell a yen.
D-Ani
Ananse
(03/06/03; 21:19:23MT - usagold.com msg#: 99034)
DMZ Heating Up
Garnered from a conversation at breakfast this morning: The DMZ has apparently been heating up quite a bit. However, it isn't being mentioned in the media. Well, I'm in Seoul now so maybe I'll hear something else interesting.
Got gold?
Ananse
(03/06/03; 21:16:09MT - usagold.com msg#: 99033)
***$399.00***
I confess. I bought the 30 tonnes of Portuguese gold. I plan to use it to buy up as much of the "New American Frontier" (frontier defined as land with a population of fewer than 6 people / square mile). I have no desire to become a "land baroness," but if Depression II hits, there will be people in need of places to go where they can do a bit of homesteading -- build stawbale houses and raise food. I think it will be important to help keep folks going. And if Depression II doesn't hit, I will be a land baroness.
Oh mighty and puissant Wizard, is it within your powers to move my guess up to the next available spot should the one I have chosen be taken? I am currently on a recruiting / marketing trip in Asia and have limited opportunity to check in at the Forum. Thank you.
sector
(03/06/03; 21:03:26MT - usagold.com msg#: 99032)
WAGE REVOLUTION / Domestic jobs go as firms seek cheap labor in China
http://www.yomiuri.co.jp/newse/20030307wo11.htm
Yomiuri Shimbun
This is the last installment in a three-part series focusing on the spring labor offensive (shunto) and changes in the wage system.
In September, Sankyo Seiki Mfg. Co. closed its video camera motor manufacturing plant in Iida, Nagano Prefecture.
The plant was ideally located for a precision instrument manufacturer at the foot of the Kiso mountain range, an area known for its fresh air.
But these days the cool alpine air blows through an empty factory. One of the production lines was moved to another plant operated by the firm's Chinese subsidiary in Guandong Province and 200 workers were transferred to other domestic plants of the firm and affiliated companies. Some employees opted to leave the company under an early retirement option.
This kind of story is now common throughout the country.
++++++++++++++++++++++++++
China's influence isn't just over the US. It has caused a warping of geopolitical structures and forced the current drastic currency rebalancing process. The Euro shoots to 1.1 and is headed towards 1.4 by the end of the year while the dollar [as measured by the Major Currency Dollar Index] is headed towards 72.
Think of that delta move in terms of aircraft sales. A Boeing 747 if purchased by European firms will cost 50% less at year's end. The Airbus will cost 50% more if purchased by US firms.
Once cheap Chinese goods will cost 23% more. Oil is a cat's toy.
Our major trading partner, Japan, just cannot survive by lowering it's yen without triggering a stampede to gold. The Greenspan policy of continued policy failure denial because he fears loss of face is drawing many critics these days.
The Chinese are loath to cooperate and raise the Yuan thereby making their goods more expensive and less competitive. They like things as they are.
All this currency action feeds gold and makes it stronger.
Nesbit Burns "Expert" gold analysts call for $320 to $350 gold at year's end.
A blind donkey could tell you that with its link to currencies, gold cannot be anywhere near $350 by the end of the year.
The huge bullion bank set-up has arrived at the checkmate end-game...just a few more moves and the shares will finally realize they've been had. Shorts will turn to longs and never turn back.
Read here... buy here.
steady
(03/06/03; 18:47:32MT - usagold.com msg#: 99031)
korea/dollars/euroes/GOLD
blackblade what currency will a unifiyed (if it ever happens) korea use? the n.koreans do not use the federal reserve notes. This doesnt probably have much effect on demand for dollars but a unified peninsula not using a dollar could have an impact on the value of the dollar.should be interesting to watch this develope!
Waverider
(03/06/03; 18:06:21MT - usagold.com msg#: 99030)
DAILY GOLD MARKET REPORT
http://www.usagold.com/DailyQuotes.html
"The energy situation is really big news and appears to be largely ignored by the media..." follow the link....
Carl H
(03/06/03; 17:43:56MT - usagold.com msg#: 99029)
@ Black Blade: M.E. Hubbert Peak
This morning Saudi Arabian officials admitted that they had reached their "Hubbert Peak" production and are only producing oil at 9.2 million bbl/day after having reached 10.5 million bbl/day decade ago
Black Blade, is this real? If memory serves me, Deffeyes and the author of the large blue-grey paperback on the same topic (name escapes me) both said the M.E. peak was a few years off yet. If this is real, it's importance cannot be underestimated.
Belgian
(03/06/03; 14:47:08MT - usagold.com msg#: 99028)
@ Pinetree @ Topaz
Nothing has changed, gentlemen. Nothing !
The dollar-euro-gold-arabian oil, relationships, do evolve according to plans, laid out for already quite some time now. Geopolitical events are confirming the building of the 2 different (leading) currency-blocks (euro-dollar). Old Europ + Russia + China, do align with a higher profile around common causes (monetary and economical and strategical).
With the next ECB-banker, being a Frenchman, we will most probably witness a more "passionate" euro-gold-management (Gold-Commitments).
A harsher competitive political process of taking the world off the *old* dollar standard by wearing out the dollar's mechanics (repeat : wearing out). A long term political move that could possibly be hastened by the comming ME events.
The dollar >>> euro, *Transition* is taking place !
Currency management during this transition must happen in function of the reigning economic/geopolitical, realities.
UK/Turkey and/or other states, chosing their dollar or euro-camp.
Euro-management keeps on working on the change of the dollar-based, gold-system, through the confusing (misleading) Gold-reserve-Commitments, still (mis)percepted as naked "sales", through dollar spectacles.
The dollar >>> euro, transition-maneuver, must proceed through dollar-inflation >>> price-inflation ! Not the usual inflation, but...(Weimarish)(war) hyperinflation.
Note that POO is already more than 20 days out of the 22$-28$ zone ! The final costs of the ME-war, will be enormous and paid for with Bernanke's US-dollars. This (euro)-forced $-printing inflation is currently happening and is another main precursor for a much lower dollar exchange rate. Postponing the logical price-inflation, consequences, is a master move. Dollar-inflation *must* reach such high level that it can't be hedged (covered) with nothing anymore.
Or in other words...how does one destroys a paper-gold-derivative-hedge !?
The above is simply the explanatory theory behind the present dollar/euro-exchange rate moves (management) in conjunction with POG-behavior. Point is that one currency faction wants to "discredit" the paper-gold-dollar-system, in its hedging function and encourage dollar-inflation for the purpose of future hyper-price-inflation. This is happening NOW...full throttle, thanks to the geopolitical events !
The "creation" of dollar-reserves accelerates with each step forward of the euro ! Derivative protection for the increasing amount of new dollars, has its limits. The dollar's actions are efforts to push those limits further away. In the mean time...physical gold flows to the most pertinent oil players (Iran).
The (infidel) Eastern European states (Balkan-2005 EMU-candidates) will soon experience what it means to have an Euroland and allies that functions with the euro as a local ***reserve*** !
A * Political Game* is being played, as to limit goldprices of getting too high...soon, there will be a goldprice, without a range. Gold, was and still is "THE" political metal par excellence. It's present price-behavior, against the ongoing realities, is circumstantial evidence, of highest reliability.
ElGordo
(03/06/03; 14:46:48MT - usagold.com msg#: 99027)
Companies now working for retirees instead of shareholders
http://www.boston.com/dailyglobe2/065/business/Fidelity_cuts_pension_forecast+.shtml
''You've had this double whammy hit defined-benefit plans,'' observed Raj Sharma, a senior vice president at Merrill Lynch & Co. in Boston. ''Companies have to take money out of their corporate cash and basically plow it into the pension plan, so the company ends up, in a strange way, working for their retirees instead of for their shareholders.''
During the boom, from 1996 to 1999, the average pension fund soared from being 85 percent funded to being overfunded, at 131 percent, according to Towers Perrin, a benefits consultancy. But by the end of last year, funding levels had slumped to 80 percent, the lowest since 1993. Fidelity is 47 percent funded; a year ago, it had 57 percent of the money on hand to meet its future obligations.
A plan that invests 40 percent in bonds and 60 percent in equities, Towers Perrin said, has seen its funding level drop 20 percent in the past year and a total of 39 percent through the three-year bear market. That's the worst decline since the 1972-1974 period, when funding levels fell by 14 percent, Towers Perrin said.
The dramatic drop in the markets has many companies mulling whether to cut pension benefits, curb them for new hires, or find other schemes to lower their retirement liability.
__________
If companies hire new workers just think of the added pension
problems. Better not to hire right now. In future new workers
might get a lot less in pension benefits. Although the new
workers might have to pay much higher taxes for soc sec
program.
---
NY fare increase is more like 30% not 25%
ElGordo
(03/06/03; 13:59:01MT - usagold.com msg#: 99026)
No inflation? NY bus & subway fares jump 25%
http://abcnews.go.com/wire/US/ap20030306_1659.html
The Metropolitan Transportation Authority board voted Thursday to boost bus and subway fares by 50 cents to $2, the first increase since November 1995.
The fare hike, which will affect more than 7 million daily riders in New York City, would not go into effect until May at the earliest. The increase insured no service cuts on mass transit.
The decision on the increase came after months of dire warnings over the agency's financial state. The MTA had said the changes were needed to combat a deficit estimated to be about $952 million over the next two years.
That deficit estimate has changed a few times in the last several months, reaching as high as $2.8 billion at the end of last year before it was revised downward.
ElGordo
(03/06/03; 13:51:39MT - usagold.com msg#: 99025)
"Cloud" hangs over investment banking sector
http://quote.bloomberg.com/fgcgi.cgi?ptitle=Top%20Financial%20News&s1=blk&tp=ad_topright_topfin&T=markets_box.ht&s2=ad_right1_topfin&bt=ad_position1_topfin&box=ad_box_all&tag=financial&middle=ad_frame2_topfin&s=APmeX8xYlT2d1bmxl
The executives refused to comply with the subpoena and are trying to delay their testimony until they can coordinate other requests for evidence stemming from investor lawsuits, according to Neal Batson, the lawyer named by the U.S. Justice Department to investigate Enron's collapse. Batson has asked a federal bankruptcy judge to force the executives to appear as witnesses or face contempt-of-court charges. The bank says it is cooperating with Batson.
Credit Suisse First Boston, the investment-banking unit of Switzerland's No. 2 bank, faces an array of lawsuits claiming it issued biased stock research, sought kickbacks for shares of new stock and defrauded Enron investors, and set aside $450 million as a liability reserve last week. Its top technology investment banker, Frank Quattrone, quit two days ago amid charges of obstruction of justice.
``There's a legal cloud hanging over this industry and Credit Suisse,'' said Heinrich-Horst Wiemer, an analyst at Bank Sal. Oppenheimer Jr. & Cie., who has a ``neutral'' rating on Credit Suisse Group. ``This is one more ingredient.''
Credit Suisse said it is trying to coordinate the appearance of its subpoenaed executives with requests for similar testimony from lawyers for Enron investors. Batson told the bank that he would also subpoena individuals from seven other unnamed investment banks, said bank spokesman John Gallagher.
Under co-chief executives John Mack and Oswald Gruebel, Credit Suisse Group had a fourth-quarter loss of $811 million.
______
Lets all hope JPM gets a subpoena for Mahonia fraud.
7 other investment banks to get called! This could be
very entertaining.
Black Blade
(03/06/03; 13:49:56MT - usagold.com msg#: 99024)
Weekly Natural Gas Storage Report
http://highlandenergy.com/agachart.htm
Storage Highlights:
Working gas in storage was 838 Bcf as of Friday, February 28, 2003, according to EIA estimates. This represents a net decline of 176 Bcf from the previous week. Stocks were 981 Bcf less than last year at this time and 602 Bcf below the 5-year average of 1,440 Bcf. In the East Region, stocks were 394 Bcf below the 5-year average following net withdrawals of 96 Bcf. Stocks in the Producing Region were 209 Bcf below the 5-year average of 446 Bcf after a net withdrawal of 54 Bcf. Stocks in the West Region were 2 Bcf above the 5-year average after a net drawdown of 26 Bcf. At 838 Bcf, total working gas is below the 5-year historical range.
Black Blade: One ugly chart (see link). An energy crisis of epic proportions is brewing as NatGas supply depletes. Few companies have plans to increase drilling activity citing land access issues, lack of infrastructure (pipelines and pipeline capacity), permitting delays, etc. Next winter is going to be a disaster -- forget about "economic recovery".
Black Blade
(03/06/03; 13:41:13MT - usagold.com msg#: 99023)
Wild Markets and Wild Rumors
The markets were roiled today as rumors abounded with claims that Iraq began to blow up oil wells and that Osama Bin Laden was captured (probably from the DEBKA misinformation/tabloid site). The US has denied the rumors but on such a slow day when investors failed to show up on Wall Street traders needed something to fill their time. This morning Saudi Arabian officials admitted that they had reached their "Hubbert Peak" production and are only producing oil at 9.2 million bbl/day after having reached 10.5 million bbl/day decade ago. NatGas storage is on the fast track to critically low levels and next winter depletion is almost certain as drill rig activity remains too low and few plans to catch up. US economic news is very grim as the economy wallows in a deepening recession and unemployment rises. "Interesting Times"
- Black Blade
The Hoople
(03/06/03; 13:32:35MT - usagold.com msg#: 99022)
A few thoughts about Mr. Market...
As the daily water torture of equities, aka CNBC drivels on a few thoughts ocurred to me of reasons that seem to be contributing to equity decline. While many other reasons exist beyond these to buy gold/sell equities they still bear considering.
* As unemployment grows more people will defend a mortgage at any cost. The home is the last bit of appreciated (for now) equity. Liquidating funds is the last hope.
* Divorce rates are up 9% according to recent studies. Divorces frequently require liquidating funds to settle estates.
*Many boomers are facing college tuition costs for children that are going up by staggering amounts. With the second mortgage option frequently gone stock liquidation might again be the only choice to keep junior in school.
* Employers that are no longer willing or able to put matching 401 money into employees accounts. Again with unemployment growing both the employee and employer amount of contribution vanishes.
* Every dollar put into the stock market since 1997 (basis S-P) is a loser. Since this is when the majority of suckers got drawn in they never saw ANY stock market gain. Quite the contrary, they got swindled. Angry and sullen, they will never return to buy ANY dip ever again.
Going long equities is just as insane as shorting gold. Both
have bottomless pits to be wrong. The only logical conclusion of doing either is that they are being "managed" by people desperately defending a wrong side position. We all know by now the usual suspects. The outcome is becoming more apparent each day.
Arcticfox
(03/06/03; 13:32:23MT - usagold.com msg#: 99021)
Thousands of Russians volunteer to defend Iraq
http:// english.pravda.ru/main/2003/03/06/44067.html
00:47 2003-03-06
Thousands of Russians volunteer to defend Iraq
Around ten thousand Russian citizens have applied for entry visas into Iraq to defend this country against the planned aggression by the warmongering USA and UK, according to the Iraqi Embassy in Moscow.
Iraqi Ambassador to Moscow, Abbas Khalaf, declared last week that the Embassy had received around 3,500 requests, a number which has multiplied in the last few days, according to sources in the same Embassy.
The requests come from young males, some with combat experience, who describe themselves as "volunteers who are willing to defend Iraq against the illegal armed aggression of the USA and the United Kingdom, two countries which continue to follow a belligerent stance on crisis management, wholly outside the generally accepted concepts of a New World Order based upon multilateralist approaches to problem solving, based upon the United Nations Organisation, a position championed by president Putin's Russian Federation.
For those who present an adequate reason for travelling to Iraq, the Embassy provides a visa and transportation, free of charge.
Timofei BYELO
PRAVDA.Ru
Black Blade
(03/06/03; 13:32:08MT - usagold.com msg#: 99020)
U.S. Considers Withdrawing Troops from South Korea
http://www.reuters.com/newsArticle.jhtml?type=topNews&storyID=2338625
Snippit:
WASHINGTON (Reuters) - Defense Secretary Donald Rumsfeld said on Thursday the stationing of U.S. troops near the border with North Korea has become intrusive to South Korea, and said forces could be moved southward or out of South Korea altogether.
Black Blade: South Koreans have been protesting the presence of US troops and express an interest in "reunification" with North Korea. Perhaps the US should leave South Korea and as North Korea has a million man army those hopes of "reunification" just may become a reality. Hmmm...
Old Asian curse: "Be careful what you wish for, you just may get it"
Arcticfox
(03/06/03; 13:29:51MT - usagold.com msg#: 99019)
IRAQ BLOWS UP ABOUT 2,500 OIL OILFIELDS
http://en.rian.ru/rian/index.cfm?prd_id=160&msg_id=3080125&startrow=1&find=iraq
2003-03-06 11:32 * IRAN * IRAQ * OILFIELDS * ELIMINATION *
IRAQ BLOWS UP ABOUT 2,500 OIL OILFIELDS
TEHRAN, March 6, 2003. /from RIA Novosti correspondent Nikolai Terekhov/. - Iraq has dropped bombs hitting 2,500 oil fields that cover a vast area.
According to the IRNA agency, the bombing near Sharjeh resulted in the explosion of an oil refinery near Kirkuk.
Some oil-bearing wells were mined with antitank mines.
The Iraqi Army units are ditching around near Baghdad and Kirkuk round the clock to resist the US Army.
TownCrier
(03/06/03; 13:20:38MT - usagold.com msg#: 99018)
European Central Bank cuts key rates by 0.25 percent
http://www.ecb.int/key/03/sp030306.htm
Excerpt of statement by Willem F. Duisenberg, President of ECB:
"We have comprehensively reviewed monetary, financial and economic developments today. We concluded that the outlook for price stability over the medium term has improved in recent months, owing in particular to the subdued pace of economic growth and the appreciation of the exchange rate of the euro. As a result, the Governing Council has decided to lower the key ECB interest rates by 25 basis points."
The main refinancing rate now stands at 2.50%.
The Bank of England cut their own rates in a surprise move by 0.25 percent last month, yesterday Norway cut theirs by .50 percent.
Ansering a question why the rate was cut by 25 (instead of 50) basis points at this time, Mr. Duisenberg said:
"We are not in a position to precisely ascertain what the future will bring. Especially the geopolitical uncertainties are such and so large that it is simply impossible to make a precise judgement about what monetary policy would do and will do. ...the Governing Council remains alert and stands ready to act decisively and in a timely manner, but the consequences of a war can go in many directions. So can the decisions of the Governing Council."
Further...
Question:
"Has the effective or mere threat of war already had some sort of impact on the euro zone economy that you could determine?"
Duisenberg:
"It is our impression that the by now rather prolonged threat of war has already undermined confidence to such an extent that it has already had, or at least is having, a dampening effect on consumer demand."
Question:
"And my second question is, you said in your statement that the ECB is alert and ready and I wonder whether if that is the reason why you don't have the word "appropriate" in your statement?"
Duisenberg:
"Well, if we use the word "appropriate" we expect it to remain valid for a considerable period of time. By now the uncertainties are so great and the developments may come so fast. And we are not even certain of what direction the actual development will take. So that is the reason why we deliberately avoided the word "appropriate" because that would give a sort of consolidation idea which we simply don't have."
---------------
Further into the Q & A session, Mr. Duisenberg in an unrelated context touches on a key point that sets the new European banking paradigm apart from the U.S. counterpart -- "Under the Treaty the central banks are forbidden to finance governments, to give credit to governments."
R.
Operative
(03/06/03; 13:19:13MT - usagold.com msg#: 99017)
@ RILEY
Leave it to a woman to find the great bargins in the world!
"Yes, I bought the gold and I'm glad and I would do
it again. (Just don't tell my husband) "
P.S.) If those retirement plans ever include a boat I think I could fall in love all over again. <grin>
Good luck with the contest, and thanks for the smile today.
RILEY
(03/06/03; 13:11:19MT - usagold.com msg#: 99016)
contest
****354.7****
"Yes, I am the one who bought the 30 tons of Portugal gold, and I did it because in a few years I hope to be retiring. The 401K money I had in my account went down the flusher so I need a solid investment to count on. The 30 tons of Portugal gold should just about cover the rising medical cost of us elderly floozies and since I intend to outlive my husband, the money will be needed to cover the rising cost of the plastic surgeries, lipo suctions and lenghty cruises to warm wonderful places. I think if I only live to be 83 1/2 the thirty tons will just about cover the lifestyle I intend to enjoy. Yes, I bought the gold and I'm glad and I would do it again. (Just don't tell my husband)
TownCrier
(03/06/03; 12:42:35MT - usagold.com msg#: 99015)
Swiss National Bank slashes own rates in surprise move to weaken franc
http://keyinvest.ubswarburg.com/ki/ch/en/newsbody.ki?newsid=787565
ZURICH, March 6 (Reuters) - Swiss National Bank Chairman Jean-Pierre Roth cited ... Switzerland's weak economic outlook for a surprise cut in interest rates.
The central bank cut the key short-term money market
interest rate target range by 0.5 percentage points to 0.0-0.75 percent and said it would target the lower end of the band, or effectively 0.25 percent.
While the rate cut boosted the euro against the franc, the Swiss currency remains around all-time highs against the currency of its major trading partner and around four-year highs against the U.S. dollar.
----(see url)------
With official action like that to weaken is national currency, echoed by the Japanese selling yen in yet another example, savers should learn they are ultimately better off choosing physical gold to preserve purchasing power over any nation's unit of money.
R
pinetree
(03/06/03; 12:31:37MT - usagold.com msg#: 99014)
Belgian....
Your wisdom is certainly missed....especially now in this world flooded in turmoil. Return soon...............
TownCrier
(03/06/03; 12:30:59MT - usagold.com msg#: 99013)
Federal Reserve pumps money supply, adds $9.25 billion to bank reserves
While the market in fed funds was trading on target at 1.25%, the Fed trading desk entered the open market today to add $4 billion with 28-day repurchase agreements and $5.25 billion through overnights.
Diversify with gold because there is no meaningful limit to this process of money creation.
R.
USAGOLD / Centennial Precious Metals, Inc.
(03/06/03; 12:21:06MT - usagold.com msg#: 99012)
Why should YOU buy gold? Because no one ELSE will do it for you. We can help.
http://www.usagold.com/gold-coins.html
Gold has no employees, no overhead, and no financial statement to balance. It cannot go bankrupt. Gold is wealth itself. It is valued worldwide on the basis of its uniquely reliable form and function -- a steadfast financial asset which is immune to the contagious collapses to which all financial paper is prone.
In the September 2000 issue of News & Views: Forecasts, Commentary & Analysis on the Economy and Precious Metals USAGOLD-Centennial Precious Metals' founder and proprietor Michael Kosares said:
"[M]uch of this issue is devoted to oil, inflation, international politics and gold. . . . . Though the dollar continued to rise against most international currencies during the past month, most currencies ( including the dollar) were depreciating against real goods. . . . AND IT IS THE TREND THAT HAS ECONOMISTS CONCERNED. Crude oil, which must be purchased with dollars, is being blamed as the chief culprit. When the dollar price of oil rises, it fans the inflationary fires of nearly every nation in the world. All of this could at some point inspire a dollar rebellion among the nations of the world, with both oil producers and oil consumers capable of finding fault with the dollar simultaneously . . . . In such a case gold, of course, would become one of the primary beneficiaries and the dollar could go into a tailspin."
Take note that was written in September, 2000. Those who took advantage of Mr. Kosares' analysis -- and many did -- have been rewarded in two ways:
1. They averted disaster in the stock market.
2. They have participated in gold's meteoric rise.
News & Views is available to our clientele only. However, the latest issue is back from the printer and available to prospective gold investors who request an INFORMATION PACKET on one-time only basis. We invite your request.
If you would like to get a feel for the thinking that forms the basis for market conclusions like the one featured above, take advantage of the offer to include THE ABCs of GOLD INVESTING: PROTECTING YOUR WEALTH THROUGH PRIVATE GOLD OWNERSHIP. A prompt with ordering information will come up after you submit your request for the INFORMATION PACKET.
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