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ARCHIVED DISCUSSION FROM 11/7/2001
All times are U.S. Mountain Time
(Yesterday's Discussion.)
Netking
(11/7/01; 23:58:13MT - usagold.com msg#: 64908)
A Cycle Odyssey: Silver 'n Gold 2001
http://www.insiidetrack.com/
Gold & Silver cycle timing snippets making market predictions & integrating innovative cycle work from the likes of W.D.Gann, Fibonacci, Biblical & natural cycles with proprietary technical indicators to give "an interesting perspective"; (Interestingly, per below back in July this year Silver was picked to have a target bottom of $4.11-$4.15 during 2001 - Netking)
*** 2001: A Cycle Odyssey *** (written July 2001)
- Gold/Silver Cycles Bottom in 2001 & Surge into 2003
". . . Gold & Silver should bottom this year and then see a strong surge in the end of 2001 and the beginning of 2002. . .
In the last 100 years, Silver set 10 important (what would be termed 'major') lows. . .70% of the major lows in Silver of the last century occurred in the '01' or '02' year of the decade (1902, 1921, 1932, 1941, 1971, 1982, & 1991). 2001 - 2002 fits within this ongoing sequence. 2001 is also both 30 & 60 Gann/geometric years from the 1941 & 1971 lows. It is a Cycle of Time 19 years from the 1982 low.
. . . the month of August represents a 50% retracement in time from the 7-year/84 month rally between Feb. '91 - Feb. '98. The 3.5 year/42-month drop from the February 1998 peak represents some well-documented (as well as Biblical) cycles of significance. So, between late-July & early-August, 2001, Silver will have entered the 540th week from its Feb. 1991 low and the 180th week from its Feb. 1998 peak. Silver also just completed the 90th week from its September 1999 secondary ('B' wave) peak, 135 weeks (3 x 45) from its December 1998 'A' wave low and is at 210 weeks from its July 1997 low.
So, there are strong decennial ('01 or '02 year of each decade), yearly (30/60/19/7/3.5-years), monthly (84 & 42 months) & weekly arguments for Silver bottoming in late-July or early-August. . . the month of August is the perfect contrast (180 degrees on a calendar from the Feb. 1998 peak & Feb. 1991 low) for a low…the time is ripe for a sharp surge in Silver. Silver is still within striking distance of its major downside objective (411 - 415.0/SI), and the HLS of the current week coincides at 411.5/SIU." [© ITTC - August 2001 (7/30/01) INSIIDE Track]
Waverider
(11/7/01; 23:32:09MT - usagold.com msg#: 64907)
Introduction
Perhaps it is time to introduce myself as I have been an observer of this discussion on a daily basis for many months now. I commend the calibre and sophistication of dialogue I read here but I admit that I was disappointed when I read the criticism of Mr. R. Howe yesterday. It is too easy and simplistic to offer negative criticism; it is much more difficult and time-consuming to offer constructive, critical, well-researched, and justified opinions and arguments on a subject - the latter, fortunately, is mostly what I see in this discussion group. We should always avail our opinions to the responses of others and never believe that we are so "right" as to shut off discussion. Kudos to those of you who took a stand today - all that requires negativity/evil to flourish is for good men to remain silent. I am a Canuk from Vancouver and am a long-term gold bug. I am not in the investment field professionally, but do manage my own portfolio. Hence, when you hear from me I will likely have more questions to ask than opinions to offer - patience please. Keep up the great discussion - I am sure there are many people like myself who read, analyze, and learn from the many varied and informed opinions here. Thank you all and ps - when I do contribute, it will be from a "woman's" perspective. Cheers.
Waverider
megatron
(11/7/01; 23:26:45MT - usagold.com msg#: 64906)
Cavan Man
The events of 9-11 showed clearly that gold and silver will utterly be pounded until the wheels actually come off the cart. It will never be allowed to rise above $325 until the insane machine I call 'Alan Greenspan and Friends' is removed or totally loses the handle, in which case we will have a collapse. In either case gold value will be extremely 'subjective'. I'm sure they think they are doing us a favor.
Black Blade
(11/7/01; 23:22:54MT - usagold.com msg#: 64905)
U.S. Probes Islamic Money Exchanges
http://dailynews.yahoo.com/h/ap/20011107/pl/terror_money_1.html
Snippit:
WASHINGTON (AP) - The Bush administration is investigating Islamic money exchanges, including some in the United States, suspected of funneling millions of dollars to Osama bin Laden's terror network. German authorities say some of the financial activities helping terrorists appear to have involved outlets in the United States. Administration officials said one of the exchanges, known as hawalas, appears to be owned partly by bin Laden.
Black Blade: I saw this one coming. Hawalas work very well to transfer cash quickly and anonymously. If there is anything that the government hates, it is the inability to control and track the lives and finances of everyone. Hawalas have been around for hundreds of years and were used as banks for traders in the Middle East and Asia. But bank secrecy has been under fire the last few years and banks in Switzerland, the Caribbean, and other countries have caved in to US pressure. Now a convenient excuse has come along to shutdown the Hawalas. Does Gold confiscation seem so far-fetched now? I don't think so, but then again - Hmmm…
Old Yeller
(11/7/01; 22:44:39MT - usagold.com msg#: 64904)
ORO;#64874
Is this post the Rosetta stone for all of us amateur economists trying to understand perplexing US dollar strength?
I remember Mr. Moto at piraz.com mentioning US strong-arm tactics with the Asian tigers to open up their debt markets in the mid-90s.Is this part of the Rubin gambit that led to all the ramp-ups in various charts that all started at around the same time?If this dollar debt demand is so immense and trade flows are falling world-wide,what is the endgame?What of all the dollar reserves in Asian central banks,could they not convert these reserves to euros,thereby freeing up dollar liquidity?Or would that trash their currencies?
Please don't feel obligated to answer these questions,I obviously have to do a lot more research on my own.Thanks for the brain stimulation.
Christian
(11/7/01; 22:42:22MT - usagold.com msg#: 64903)
Credit Creation Gold
Debt is the consequence of a lack parity, and the lack of dollars in non debt form. All money is debt money, there is no other source except to borrow it into existence. Debt can not be retired with debt dollars. The sum of all borrowed money must be repaid with a greater amount of money then that which was borrowed because of the cost of usury (interest). The sum of all parts of anything can never be greater then the whole. Therefore debt must be repaid with more debt. An example of this is the pay down of the 30 year Treasury bonds with bonds from other Government Sponsored Enterprises (GSE's). All currencies are dropping in value. The currency depreciations serve as a tariff. Currencies drop in value against basic necessaties (everything that can not be done without) and credit creation gold we the people are not allowed to trade in. Credit creation gold is a basket of goods that consists of metals used in industry, fuels to power industry, housing for people and buildings for industry, foodstuffs to feed people consisting of grains and meats, and productive land be it forested or cropped. All this is represented by credit creation gold. This credit creation gold can not be used for commodity gold. Central Banks around the world are selling the publics gold so the owners of the very same banks can buy this commodity gold and use it for credit creation gold. This gold is priced based on needed reserve requirements which must be around 5%. (N)x5=100. N=20x$280=$5600. No bank in my area has a 5% reserve. It is more like 2 to 3%. That puts the credit creation gold much higher. We the common people of this world are serfs or slaves and we need to get used to it.
Netking
(11/07/01; 20:29:13MT - usagold.com msg#: 64902)
Saudis concerned over massive unrest
http://www.menewsline.com/stories/2001/november/11_08_4.html
Arab diplomatic sources said Saudi officials and diplomats have sent messages to allies that the unrest could erupt when the Islamic fast month of Ramadan begins later this month. Ramadan, which is set by the lunar calendar, is expected around Nov. 15.
The message has been relayed to the United States through Pakistan, the sources said. Pakistan is regarded as one of Riyad's closest allies and both supported the Afghan ruling Taliban movement, now under U.S. attack.
The sources said Saudi Arabia envisions huge Islamic protests of the war throughout the Middle East and the Persian Gulf. The rallies would then sweep the Saudi kingdom, several of whose leading clerics have condemned the war.
Cavan Man
(11/07/01; 20:26:50MT - usagold.com msg#: 64901)
Where's the A/FOA & EU troops?
From MSNBC:
WARNING THAT MAIL service is on the brink of
financial disaster, postal managers are preparing to ask
Congress Friday for a huge bailout, about $6 billion. The
precise request is to be determined Wednesday night.
Half of the money would be for new equipment to
sanitize mail and protect workers. The other half would be
used to make up for lost revenues, because people are now
sending less mail.
IF NOT NOW OR QUITE SOON FOR AU THEN WHEN OR NEVER? WE ARE WITNESSING MONETARY AND FISCAL MISMANAGEMENT ON A GRAND SCALE IMHO.
Black Blade
(11/07/01; 20:21:04MT - usagold.com msg#: 64900)
Grupo Mexico says unable to meet debt payment
http://biz.yahoo.com/rf/011107/n07302472_1.html
Snippit:
MEXICO CITY, Nov 7 (Reuters) - Grupo Mexico , the world's No. 3 copper producer, became the second Mexican company since the Sept. 11 attacks on the United States to say it will be unable to meet its debt obligations because of market turmoil. The mining and railroad company told the Mexican Stock Exchange on Tuesday it would have trouble making an $84 million pre-payment on a revolving credit that matures Nov. 10, 2002. The credit was taken out in 1999 to help finance Grupo Mexico's $2.25 billion acquisition of U.S. copper company Asarco Inc. said the letter to the stock exchange.
Grupo Mexico said that the financial difficulty came because of the steep fall in the price of copper -- now trading at its lowest level since 1987 -- and other metals produced by Asarco and other Grupo Mexico units.
Black Blade: This is no surprise. Phelps Dodge (PD) another copper producer hit the skids when higher energy costs resulted in layoffs and reduced output. Rumors persist that many major miners in copper, silver, and gold will be out of business or acquired within the next 5 or 6 years. These include Grupo Mexico, Phelps Dodge (PD), Barrick Gold (ABX), Newmont (NEM), and Placer Dome (PDG). Virtually all these companies have gutted their operations and are high-grading the ore without replacing reserves at many operations. After the high grade is mined there is only marginal ore or high-grade ore that becomes uneconomic due to engineering changes. I saw much of this firsthand and it does not surprise me that we could see many of these companies cease to exist in the not too distant future. If metals prices were to rise many companies would still be in serious trouble due to large forward sales positions (and many counter-parties will have to eat their paper as default is inevitable). Many of these companies are backed into a corner and the only avenue left is to merge and acquire other miners on the cheap to satisfy old forward positions or to engage in new forward sales. As prices fall, there is little incentive to lock in to very low forward prices. Then the "House of Cards" falls in on itself. There is very little if any new exploration activity - this will eventually result in reduced supply and higher prices. - "Game Over"
Black Blade
(11/07/01; 19:30:41MT - usagold.com msg#: 64899)
Forbes Body Count
http://www.forbes.com/2001/01/30/layoffs.html
The bodies keep piling up as more nonessential "Bones" are cast aside. Boeing reports that they will speed up the layoff process that they announced a few weeks ago. Boeing announced that they will layoff over 30,000. Now that's one big "Bone Pile."
megatron
(11/07/01; 19:26:14MT - usagold.com msg#: 64898)
jb
That was a poorly thought out jab, I should know, at someone who I consider one of the most positive role models for any investor involved in the market.
Canuck
(11/07/01; 19:21:46MT - usagold.com msg#: 64897)
Gentlemen
Came back to check responses.
Perhaps we are all correct and should offer self-congratulations.
To us:
I feel we are brilliant, handsome and looking to the future, going to be wealthy beyond words.
Cheers!
slingshot
(11/07/01; 18:25:56MT - usagold.com msg#: 64896)
Netking
Neither. It was Old Milwaulkee. BBuuuuurrrrrpppp!
slingshot
Netking
(11/07/01; 18:20:20MT - usagold.com msg#: 64895)
Canuck & Galearis
(64882/3) Good comments guys . . . was it the fine Canadian or was it Kiwi beer that made those workers "supermen"?
uponroof
(11/07/01; 17:57:48MT - usagold.com msg#: 64894)
Ghettoizing the World
http://www.geocities.com/globalghetto/
Very similar to our barbaric thoughts of dollarization, yet much more militant. Some serious western world/white man hate in here:
"...This hierarchical classification signifies a grouping of states that are similar to each other and superior to the 'third-class' countries beneath them. The 'West' or the 'First-World' is similar in terms of the Christian religion and being white (for the most part), and the 'Third World' is predominantly non-white and thus 'inferior' and uncivilized. It is implicitly acknowledged and ‘politely’ enforced by the West that white Christian nations are superior to all others and so are ‘God-appointed’ leaders. This ideology has its history in the fall of the Roman Empire, and the subsequent success Europeans had in dividing the world among them. The moral justification to subjugate people was provided by the 'Holy' Bible..."
Canuck
(11/07/01; 17:49:27MT - usagold.com msg#: 64893)
Ari c/c Leigh
Ari,
I came here to see the high diving act ...............
Canuck
(11/07/01; 17:47:24MT - usagold.com msg#: 64892)
Sorry // Slingshot // Leigh
Sorry about the quadruple post (is that a first?), new high speed ISP locked up (beauty, eh) and like a registered moron I just kept pounding ENTER. (HIT ANY KEY TO CONTINUE!!!; Axe over monitor)
Slingshot:
Thanks man, needed that; ugliness level just dropped a notch.
Leigh:
Congratulations on your recent 'win'. I have great respect for you. You are the stilling waters on this forum. I envision you somewhere between my mother and a 24 year old fox and please, (blush) consider either to be a compliment.
Canuck.
uponroof
(11/07/01; 17:39:02MT - usagold.com msg#: 64891)
The Koran, Interest,and the Economy
http://members.aol.com/silence004/interest.htm
One thing that jumps out at you is the fact that Islamic Banks DO NOT CHARGE INTEREST, just a straight fee. It is against their beliefs as defined in the Koran.
Can you imagine how they feel about derivatives? I dare say we may have some commom ground in here somewhere.
auspec-nice comments on Enron! btw- Are we seeing capitulation with this volume and possible trend reversal at hand? [buy]. Or is this a real golden crisis with no easy [physical] way out?
Canuck
(11/07/01; 17:30:40MT - usagold.com msg#: 64890)
@ Oro
Re: 64874
I am not going to pretend that I understand past the first two sentences of your post.
However, I will cut to the chase and ask you the following; what do you speculate the exchange rate of the Dollar/Euro in 3 months/6 months/1 year/3 yrs./10 yrs.?
Thanks in advance.
Canuck.
Mr Gresham
(11/7/01; 17:27:01MT - usagold.com msg#: 64889)
Oro
Lots to chew on there, and I'm trying to get your dollar demand figures. They are important because all we usually hear is the trade imbalance (implying dollar excess -- but you say that was a mid-90s characteristice), and FOA follows pretty closely in that line of thinking.
Is your $460 billion dollar demand derived from :
"3. Dollar borrowing: Developing nations: -$90 billion (about +$140 billion in the mid 90's), Europe: about $200 (the balance of 400 billion in euro and some sterling)., Japan: -$40 billion.
Interest due: Developing Nations: $140 billion, Europe: $250-300 billion, Japan, about $40 billion."
I didn't add the figures together in that section because it already seemed way over 460. But Europe, aren't they a net creditor anyway -- so where is the dollar demand? Or have we just got our signs reversed?
And these are annual, net, additions to existing balances, right?
Additional curiosity while I'm at it: if this is a time of dollar strength in each of these categories (vs. mid-90s in contrast) what would be the trigger to weaken any or all of these dollar strongpoints?
Canuck
(11/7/01; 17:26:29MT - usagold.com msg#: 64888)
@ Oro
Re: 64874
I am not going to pretend that I understand past the first two sentences of your post.
However, I will cut to the chase and ask you the following; what do you speculate the exchange rate of the Dollar/Euro in 3 months/6 months/1 year/3 yrs./10 yrs.?
Thanks in advance.
Canuck.
Canuck
(11/7/01; 17:24:33MT - usagold.com msg#: 64887)
@ Oro
Re: 64874
I am not going to pretend that I understand past the first two sentences of your post.
However, I will cut to the chase and ask you the following; what do you speculate the exchange rate of the Dollar/Euro in 3 months/6 months/1 year/3 yrs./10 yrs.?
Thanks in advance.
Canuck.
Canuck
(11/7/01; 17:23:32MT - usagold.com msg#: 64886)
@ Oro
Re: 64874
I am not going to pretend that I understand past the first two sentences of your post.
However, I will cut to the chase and ask you the following; what do you speculate the exchange rate of the Dollar/Euro in 3 months/6 months/1 year/3 yrs./10 yrs.?
Thanks in advance.
Canuck.
slingshot
(11/7/01; 17:22:43MT - usagold.com msg#: 64885)
Canuck Msg# 648833
The Firemen were singing,
Hi Ho, Hi HO, Its off to work we go!
Made the job easier for sure.
Slingshot
Canuck
(11/7/01; 17:00:59MT - usagold.com msg#: 64884)
@ Galearis
Devil's Advocate?
Canuck
(11/7/01; 16:56:58MT - usagold.com msg#: 64883)
@ Netking
Very good observation.
Kind of fits in with the 'stories' from the mayor of New York (will not attempt the spelling) with the $375 million dollars and the press number of $220 million and the Comex number of $275 million. Hey, the numbers only differ some 30 or 40 percent??
So what the hell, a couple dozen strapping firemen carried 750 tonnes of metal UPHILL, SEVERAL STORIES through busted debris in an afternoon? Let's go a little further, they probably REFINED it on the way up, you know, it was bent, dented and dusty?
And what the hell, EVERYONE was convinced that the metal was stranded underground for months and suddenly, suddenly the metal was extracted in a week?? What the hell, let's have breakfast, some monster pancakes and carry 757 tonnes of gold and silver to the 'surface', have a beer after lunch and call it a day, SHALL WE?
Lying bastards.
Good observation Netking, excellent job.
This gold thing, whatever the hell it is and now the war issue, wouldn't it be handy to see a view of history 10 or 20 years into the future.
Sorry to rant and rave, cranky the last couple weeks.
Galearis
(11/7/01; 16:33:34MT - usagold.com msg#: 64882)
@Netking et al re gold and silver removed....
I bet that...
What was seen was likely the last two trucks pulling out. If I was hauling away this weight I certainly wouldn't call attention to it at the beginning of the operation - rather at the end, and do most of the work at night.
Of course there could have been only two truck loads too.....
FWIW
Galearis
(11/7/01; 16:28:29MT - usagold.com msg#: 64881)
@Netking re ebay survey - on gold bullion etc.
physical gold prices vs paper spot (just to be fair) - ebay again...
1288111818 1998 Gold Eagle 1/4 oz. Bullion Anthrax $75.01 4 Oct-24 17:01
1287467268 1 Oz. Krugerrand Gold Bullion**NR** $300.00 14 Oct-24 19:51
1287069593 American Eagle Gold Bullion $5 Coin 1/10 oz. $33.00 4 Oct-25 17:09
1287255366 Australian Nugget 1/10 oz. Gold Bullion Coin $37.57 2 Oct-26 08:16
1287648064 GOLD BULLION 1 OZ MAPLE LEAF COIN 24KT BU $290.33 9 Oct-27 13:04
1287650637 GOLD BULLION 1 OZ MAPLE LEAF COIN 24KT BU $293.00 9 Oct-27 13:11
1287653026 GOLD BULLION 1 OZ MAPLE LEAF COIN 24KT BU $297.26 14 Oct-27 13:19
1287747190 1986 American Eagle 1 oz Gold Bullion Proof $420.00 17 Oct-27 18:27
1290401382 10 (1 OZ) 999.9 FINE GOLD BULLION BARS $2,800.00 1 Oct-27 19:35
1288040373 American Eagle Gold Bullion Coin 1 oz./ounce $335.50 15 Oct-28 13:06
1289716838 1 oz American Gold Eagle $50 Bullion Coin NR $295.00 7 Oct-28 16:07
1021936762 American Eagle Gold Bullion $5 Coin 1/10 oz. $37.00 5 Oct-28 17:18
1290370860 American Eagle Gold Bullion $5 Coin 1/10 oz. $35.00 1 Oct-28 19:25
1289312151 Qty. (5) 1 oz US Gold Eagle Bullion coins $1,475.00 - Oct-29 17:04
1289360817 Bullion Gold Coin, Krugerrand 1 oz. $290.00 22 Oct-29 18:43
1290501604 GOLD 1978 KRUGERRAND COIN -1 OZ.GOLD BULLION $298.00 1 Oct-29 19:31
1292260508 American Eagle Gold Bullion $5 Coin 1/10 oz. $35.00 1 Nov-01 22:11
1289972997 1 Troy oz .9995 Engelhard Fine Gold Bullion $315.00 10 Nov-02 11:05
1024188928 1998 Gold Eagle 1/4 oz. Bullion NBC $76.00 7 Nov-02 13:35
1290382536 1 oz. Canadian Maple leaf. $50 gold bullion $290.00 2 Nov-03 15:07
1290386764 1. oz gold bullion coin PHILHARMONIKER *LOOK $294.00 2 Nov-03 15:22
1291988356 GOLD BULLION 1 OZ MAPLE LEAF COIN 24KT BU $292.55 8 Nov-03 15:51
1292443881 GOLD BULLION 1 OZ MAPLE LEAF COIN 24KT BU $295.32 13 Nov-04 18:08
++++++++++++++++
The odd bargain here....but riskier..
G
auspec
(11/7/01; 16:04:00MT - usagold.com msg#: 64880)
Midas Snippet/Enron
"Enron was to be a partner with Goldman Sachs in an electronic gold exchange. In addition to being a huge energy player, Enron is well known to have massive derivative positions. Enron is desperate for cash. It would not surprise me if they are also short a large quantity of gold and have been using the practically interest free gold loan money to help finance their recent problems."
"If that is the case, look out. This could be the straw that breaks the Gold Cartel's fraud scheme, should they be forced to cover. The gold carry trade, or just borrowing gold at 1% interest rates, has been the greatest financial dealing of all for the past 7 years. Yet, no one admits to doing it."
"We know why and someone is going to get caught by over staying their gold borrowing welcome. Maybe it will be Enron." END
Comment: "Forced to cover"? Too well-connected to be forced to cover? Forced to dip into some slush fund? Forced to turn to the taxpayers? Forced to perpetuate the fraud with 'drive by' derivatives? Forced to wag the entire kennel? Take your pick, pay me now or pay me much more later.
cwa
(11/7/01; 15:56:28MT - usagold.com msg#: 64879)
Netking: re, WTC gold & silver
You have a very good and overlooked point. Two Brinks trucks could not have moved out the silver. I would put the carrying capacity of these trucks at 10,000 to 15,000 pounds each. From my calculations, the two trucks featured on the television news could have only moved out the gold. I based this on there being 31.1 grams to the troy ounce and a stated figure of about 300,000 ounces in the vault. About 9.5 metric tonnes of the yellow metal. (These figures are rounded)
So if the silver wasn't moved then maybe it wasn't there to begin with! Wouldn't supprise me if that was the case.
Cavan Man
(11/07/01; 15:48:06MT - usagold.com msg#: 64878)
PS: ORO
Dear Sir: You are entitled to change your mind! Best...CM
Cavan Man
(11/07/01; 15:47:05MT - usagold.com msg#: 64877)
ORO
RE: A/FOA
Hello ORO. I feel compelled to point out for the reading and thinking audience here that at one time and for a reasonable period of (that) time, your own thoughts on the A/FOA commentary seemed to me, to be, rather consonant (with FOA). What has changed your opinion so and engendered such a vehement opposition and denial of their credibility?
Respectfully.......CM
BR549
(11/07/01; 15:45:34MT - usagold.com msg#: 64876)
General government net debt interest payments as a percentage of nominal GDP
http://www.oecd.org
Belgian (msg#: 64872)---
I think to get the ratios of actual debt to GDP will be difficult. I think what would be more meaningful would be the interest payments on the debt as a percentage of GDP.
If you agree then this data is available at OECD for all of the countries in the world:
General government net debt interest payments as a percentage of nominal GDP
(see chart at http://www.findarticles.com/cf_dls/m4456/1999_Dec/59014390/p1/article.jhtml?term=)
If you want to keep it simple you need to define whether stats are to be nominal, is the data seasonally adjusted, done in constant dollars, what the debt consists of, and are the statistics at the various countries statistics departments up to date or estimated which will be adjusted later.
Regards,
BR549
Netking
(11/07/01; 15:29:26MT - usagold.com msg#: 64875)
Ag - How'd they do that?
This for the conspiracy theorists from a post by 'wally bently' - Netking
------------------------------------------------------------
"Do 20 million ounces of silver fit in 2 Brinks like trucks?
Saw recent photo of two well guarded Armoured Brinks type trucks supposedly hauling out 230 million dollars of gold and silver from World Trade Center vaults to make way for demolition.
My old math says this is difficult to believe. Recent articles on Gold Eagle suggest there was 20 to 30 million ounces of silver stored and owned by Mocatta.
My math is as follows: 2,200 lbs per metric tonne.
12 troy ounces of silver per lb. thus:
20,000,0000/((12)x (2200)) = 757 tonnes.
The maximum load per truck I would think is about 10 tonnes. This would suggest about 75 trucks to haul only the silver away. The article also implied that policemen and firefighters hand loaded the trucks. To move 757 tonnes into a truck or trucks would require dozens of people and probably a week in my opinion.
What am I missing? Could this just be a diversionary tactic to distract attention from the actual silver and gold movement which is still to take place? Could there have not been that much gold and silver as previously published?
Netking > Validity? . . . A "Wag the dog" production for publicity? . . . or just the first two Brinks truck loads of many? The truth is as they say . . . out there.
- Netking.
ORO
(11/07/01; 15:20:31MT - usagold.com msg#: 64874)
The Invisible Hand - The performance of one hand clapping
FOA and ANOTHER talked many times of the EU, and the Gulf Royals insisting that they do not want to continue within the dollar reserve system because of its "dependence on the economic performance of the US". The analogy they provide is that it is like using the bonds of just one neighbor for your money. Such that if the neighbor is economically challenged, the value of the bonds is nil.
Here, as is often the case, is another economic fallacy and a single party's view of the meaning of the risks it took in participating in the current system.
First of all, it is the distinct and nearly singular position of central banks that they are stuck with US government bonds as their largest asset that is not a domestic credit acceptance of some sort, or gold. Few others hold any significant quantity of Treasuries, excepting US banks. It is uniquely their position because of the IMF agreements, but it has been quite a while that they could have purchased other dollar bonds for reserves, but have not. They could have kept cash balances with banks other than the Federal Reserve, but did not do so. Quite contrary to FOA's claims, the main reason that Treasuries have not accumulated at the central banks since 1997 is two fold: (1) The US government was not issuing any more of them on net. (2) Nobody has enough dollars to buy them with even if there were any more to buy, since 1997 there has been a fall in foreign CB dollar deposits at the Fed, which is very much related to the then ongoing dollar credit contraction in emerging market economies. This contraction continues in its deflation as the external dollar debt supply demand balance is still in severe deficit, the latest casualty of the dollar scarcity being Argentina's currency board (something that a net external debtor nation should never even consider).
The other side of this can be said to be the US gov and the Fed reacting to the threat of no further allocation of credit by the ordinary creditors (EU, HK, Japan, etc..). Which would be historically correct if your mind is stuck in the 1980s. But the supply demand balances are so overwhelmingly tight that it is extremely unlikely. As a case in point one should look at deposit balances with the Fed, the core cash holding of the dollar reserve system outside the US:
http://www.federalreserve.gov/releases/Bulletin/0901assets.pdf
1997 1998 1999 2000Dec. 2001 Jan. Feb. Mar. Apr. May June July
457 167 71 215 199 196 70 101 86 102 84
It should be obvious here that since 1997 the world has been starved for dollar liquidity, which is essentially what the Asian crisis was, what the Russian default was, what the Brazilian Real float was, and what the Argentinean problem is.
It is essentially the problem of CBs that hold treasuries that their assets depend on their value upon US economic performance. They could have taken other dollar assets, say dollar denominated Argentinean government bonds. Perhaps Korean government bonds would have been in order, Ford Acceptance Corporation paper too, perhaps Deutsche bank dollar paper. They chose to hold dollar paper of the US gov. because (1) that is what they had historically, (2) the US gov. can have the Fed buy all the Treasuries at a set dollar price, if the need ever arose, thus there is no default risk on the bonds.
The CBs face another danger: a drop in the value of the dollar itself. But then what is it that dominates dollar demand in the world markets? What affects supply? Why should they be afraid of supply overwhelming demand? Is it actually US performance that dictates the dollar's supply and demand functions?
First of all, dollar supply comes to the world markets from these sources:
1. US imports of goods and services
2. US investor's Portfolio, and direct investment abroad
3. Dollar borrowing abroad in the Eurodollar market.
4. Non bilateral trade imports and outgoing portfolio and direct investments of countries other than the US.
5. Income earned from US portfolio and real/business assets owned by foreign investors.
Dollar demand comes from:
1. Demand for US exports
2. World investor's Portfolio, and direct investment in the US
3. Dollar debt repayment.
4. Non bilateral trade exports and incoming portfolio and direct investments of countries other than the US.
5. Income earned from foreign portfolio and real/business assets owned by US investors.
Most people are not familiar with 4, so I will explain in short:
Though statistics are very often presented as if trade is between individual "countries" on a case by case basis, that is not at all how it works. People and their corporations do trade. Neither are actually very country specific in where their imports come from or their exports go to (individual people) and corporations involved in international trade have operations everywhere, where they both buy and sell. Where the contracts are actually negotiated is in an international marketplace where many bids and many asks converge and direct where a shipment from one place will arrive, and where an order from another place will be filled. The international marketplace is a single area, and trades in a single currency: the dollar. It does not do so because the dollar is particularly great, but because that is what the markets used the day before: that is how prices were quoted, and that is how long standing contracts were written, and because switching to anything else to denominate trade requires markets to undergo an extremely costly readjustment to renegotiate contracts into something other than the dollar. (Which is why the euro introduction can not make the slightest difference in the market's preference not to move to settlement in euro, in gold, or in anything else.)
The way the international marketplace operates in redenominating contracts from dollars to individual currencies is through derivatives sold by the domestic banks of the desired currency. Thus Exchange rate derivatives have a US bank obligated to supply the dollars for someone who wants to exchange a future euro revenue, and an EU bank to supply the euro for someone who wants to exchange a future amount of dollar revenues into euro. Thus a "bilateral trade" between "two countries" that are not the US is actually composed of a sale of one item into the international market for dollars payable within 30, 60 or (most commonly) 90 days, the sale of the second item for similar terms, and the purchase of these items from the same "market". The individual currencies needed by the sellers (to pay costs at home) are either purchased when the dollars arrive, or are contracted by a derivative with a local bank to buy a certain amount of dollars with the particular currency. The buyers, have the local currency, and either buy dollars on the cash market, or contract to buy dollars by the due date by sale of the currency at a set exchange rate. The latter contract would most likely be done with a local bank that will purchase a similar contract from a US bank.
Why is it done this way rather than the two parties doing a direct exchange of their goods and settling only the difference? Because there are no such two parties. The chances of them finding each other is nearly nil. The proceeds of the sale of coal from a Scotch mining company in the UK supplying a Belgian steel maker is used to purchase steel from a neighboring supplier who bought it from someone in Canada. Thus the coal for steel deal would only occur if the particular steel produced by the Belgian steel company and coal user fits the exact need of the coal miner, and if the coal from him would be of the right quality and suffice for the steel maker's needs.
On net, portfolio moves and direct investment do not actually add to dollar demand nor to dollar supply directly, nor does the international trade with parties outside the US in goods or services. These do add to the liquidity requirements – as to how many dollars need to be in cash in order to service the trade volumes. Since the markets are moving to same day settlement, the answer is that very little is necessary, only enough to cover a particular day's net imbalance in settlements. Some $100 billion.
Going back to the supply and demand figures:
The order of magnitude involved in each is given below:
1. US Imports and Exports: $1.8 trillion, $1.4 trillion, supplies a net of $0.4 trillion
2. Investment flows to and from the US: $0.69 trillion incoming, $0.33 out, net demand: $0.36, $0.29 including treasuries.
3. Dollar borrowing: Developing nations: -$90 billion (about +$140 billion in the mid 90's), Europe: about $200 (the balance of 400 billion in euro and some sterling)., Japan: -$40 billion.
Interest due: Developing Nations: $140 billion, Europe: $250-300 billion, Japan, about $40 billion.
(The above does not include bond market debts, which add 30% to 50%, but is in trend with bank data. Including non-bank lending, we have about -$130/$200 bil supply/demand for Developing Countries, $250/$350 bil for Europe, -$45/$45 bil for Japan)
5. US net income flows: supply of $5.5 billion
Totals:
Supply: From US net capital and trade flows: about $105 billion,
From foreign borrowing: $70 billion ($60 bil including bond market debts).
Total $175 billion ($160 bil including bond market debts).
Demand: From foreign dollar debt: $460 billion (about $600 billion including non-bank debt).
Imbalance: $285 billion deficit ($440 bil including bond market debts, or about a 7% deficit).
World Trade Balance: Exports of all nations less imports of all nations: -$250 billion,
down from –$100 billion per year in 1981-1993, and –$30 to -$50 billion in 1995-6).
During the recent peak Developing markets investment boom, in 1994-6, Supply stood at roughly $450 bil per year, and demand stood at about $400 per year, with the excess of $50 joining the $80-90 bil supply from the US trade deficit, and $60 bil in investment supply from US net investment abroad, to provide a $200 billion annual excess supply (about a 4% annual excess), which brought dollar values down going into 1995.
In terms of internationally traded goods, looking at the CRB raw industrials spot index, the dollar's purchasing power dropped 20% during this period as the index went from 270 in 1992-3 to 340 in 1995-6. Since this period, the dollar strengthened in accordance with its supply and demand balance going from the 340 range to under 220 recently, a 55% rise over 4 years, and 11% annual strengthening in the dollar. This brought on by an average dollar deficit of 8% during the period, with the peak deficit period of about 11% during the Asian and Russian crises, with a momentary peak of 14% in the quarter when the Russians defaulted.
Thus the scale of effect of the US contribution to the supply and demand conditions in the international markets is on the order of 30% of the net supply during excess supply periods, and nearly none of the demand, and is providing 60% of it during this contraction period. Thus on the "big float" supply side, during expansionary periods, the US is a minor player. It is only during contractions that the US is there to supply a market for the world's goods and provide the dollars that keep dollar debtors from going bankrupt.
There should be no doubt that the US enjoys an "exorbitant privilege" in the dollar reserve system so long as the dollars abroad can not be created by a "lender of last resort", while within the US there is such a lender. This produces a situation where foreign borrowers can only repay debt incurred in building business by borrowing further in the open market, or by exporting products out of domestic markets to international markets, and particularly to the US. However, within the US, banks have access to short term borrowing at rates set by the central bank, and thus their clients need not sell at distressed prices as often as would foreign debtors in the same markets, and have access to credit lines provided by US banks instead of having to borrow on the open market based on creditworthiness alone.
Much has changed over the last few decades as US banks have shrunk their market share relative to the open markets and are far more accountable for their errors in pushing debt to lesser credits. Furthermore, they face competition for their smaller clientele by small private investment pools that are cherry picking bank's smaller customer rosters. Their depository clients can also run their accounts outside the fixed value bank accounts into a broad variety of investment funds from money markets (these types of pools were common before the Fed was founded, but the Fed's first function was to undercut the interest rates they charged by printing up money at lower rates) to bond funds to stock funds. Within these markets the depository client did what he was doing at the bank, but this time with an opportunity to actually invest rather than provide monetary savings that were invested behind his back and without his control.
But there is a counter to this in that foreign borrowers and their lenders would have to be aware of the situation and could discount it in making investment decisions. But we know well that this has not been the case in developing markets. The foremost reason for this is the insistence on domestic control of industries built with foreign resources. This insistence on local control was exacerbated by the "crony capitalist" attitude that allowed foreign investments to be funneled only through the government ruler's friends and family, and central planning decisions as to which industries curry the government's favor because of their "strategic importance" and which don't. The most significant result was the reliance on debt, which maintains control in local hands, rather than equity. As a result, fixed cash flow demands characteristic of debt were imposed by local gov. authorities rather than investors who would have been happy to take an equity stake which does not obligate the company or a potential state guarantor to provide a particular cash flow. This was the source of the problem in Europe earlier on, and in Japan of the 80s and 90s, and was the problem of Asia these last two decades, and of the bulk of Latin America's economic history.
The insistence of Mahatir in Malaysia to complete an auto production project when the global market in low end autos is practically glutted with over-capacity, is a case in point. That Indonesia has produced similar fiascos nearly everywhere one looks as Suharto and his cronies built empires of bad investments, as did the Philippines under a series of corrupt successors to the unfathomably corrupt Marcos, is the reason for the 97-8 Asian disaster that we are so familiar with. The current anti-American and anti free trade protestations from these countries have most of all to do with the unwillingness of the governments to allow their local cronies to relinquish equity in their debt besotted businesses to the lenders. Instead, they are seeking to "depose the dollar" and erase the debts under the moniker of reducing dependence on US export markets. There is nothing more certain as a counter indicator than the unanimity of political voices in Asia, the ME, and in Europe, particularly regarding Russia – EU relationships, predicting a dismal economic future for America. Their certainty makes it quite impossible for this to occur, because this unanimity among politicos is a sure indicator of a very crowded trade.
Mr Gresham
(11/7/01; 14:26:06MT - usagold.com msg#: 64873)
Oro
Thanks -- I read it, and will again. We're still weaning people from that "inflation as consumer price rises" view, which it also was, deceptively, during the 1920s. Rather than the issue being "integrity of the money supply." You always introduce a few new wriggles, which take me time to sort out and integrate. I don't want to ask the first questions of the top of my head, but see if my integration gets me somewhere first.
Is Europe entering the battle of contradictions between monetary and national fiscal policies? Or is that battle already trumped by ECB independent powers? You realize that all of this is falling on the barren soil of our near-total ignorance of European political economics. You have a core of study, and even extrapolations from it, while many of us here have only begun to understand our own Fed/monetary system in the past few years. Most of our adult lives have been led in the fantasyland droolings of our youthful learning.
Since you and FOA introduce Europe as the subject, can you resolve for us how much of the issue is Europe's success economically ex the Euro, vs. FOA's assurances that the Euro carries its own independent power, from which Europe will benefit as a side effect, perhaps regardless of its inefficiencies which you critique?
Belgian
(11/7/01; 13:58:27MT - usagold.com msg#: 64872)
Simplification :
GDP = Units produced x Price per unit
GDP / DEBT = The menace !
To increase GDP, the amount of produced goods and services-unit can increase or the price per unit.
Debt can decrease by paying it back from profits or default and write off.
Today, the declining GDP is the result of a decline in produced units and their price. The decline in debt is due to refinancing and declining interest rates.
What can bring the GDP/DEBT, proportion, back to normal, as a condition for renewed expansion possibility ?
1/ - increase in produced units ?
2/ - increase in price per unit ?
3/ - debt write off ?
4 $ of debt were needed to increase the produced units by 1 $. So, I don't see how we are going to stimulate the production of more units, without further digging into debt. Therefore excluded, dispite the patriottic calls.
Default and debt-write off is excluded as well. Should mean total collapse.
So were are left with the ongoing management (final phase) on that total load of debt and the untouched increase of price per unit ! Voila, as simple as that.
There is no way out, but hyperinflation, (price per unit) to get it restarting again.
The increase of the price per unit is in function of how much debt can be eliminated and how much units will be produced (and consumed).
A continious declining GDP, makes the GDP/DEBT, more and more menacing. Strangulation !
Netking
(11/7/01; 13:44:14MT - usagold.com msg#: 64871)
jb / Galearis
jb - You're allowed to say what you think Sir. . . God forbid that we ever control each others free thinking & speech, some of us might even be "wrong" in our conclusions.
Galearis - A really useful guide on what retail demand/supply is doing to the POS - Cheers.
Old Yeller
(11/7/01; 13:18:54MT - usagold.com msg#: 64870)
Reg Howe
There are very few people in this world that I have even an iota of trust in and respect for.One of these people,certainly close to the top of my list,is Reg Howe.He has put his reputation,his livelihood and perhaps even his life on the line to fight the entrenched,bottomless resources of the monetary elite.
Perhaps criticism of his strategy is warranted and could prove helpful.I always felt that the legal action was a longshot at best and the currently highly charged atmosphere obviously does not further a cause for freedom such as his.Suggestions for furthering his cause constructively should be encouraged,catcalls and woulda/coulda /shoulda's from the bleachers really have no place in this debate.
A true American hero,fighting for the ideals and vision of what America should really be and what it should represent to the rest of the world.
"Still,the ultimate goal of us gold bugs is not the destruction of our enemies.It is honest money with permanent value.It is constitutional money protecting our freedoms and restoring integrity to our political institutions.It is an international payment system that creates a level playing field for all nations to trade, invest and pursue their economic development.It is in sum,a world where the expression "as good as gold" is not a reminder of past glories,but a statement of expected standards."
We're not getting this vision from the charlatans currently in power in the USA.Every day that goes by,every new freedom restricting law they pass and every blind bomb they drop adds a little credence to that.
All the power to you,Mr. Howe.Your cause is noble and your objectives cry out for fulfillment.May justice prevail.
BR549
(11/7/01; 12:03:42MT - usagold.com msg#: 64869)
Some people never learn
jb (msg#: 64801)--"GATA it is inexcusable not to deliver the papers in german and by a representive to BIS,any lawyer would know that.also only a fool represents himself in court. not much more to be said than that."
What is "inexcusable" is some "fool" who does not know that Mr. Howe does NOT represent himself, he selflessly represents all of us Goldbugs. (And with a naive statement like your post, you're no goldbug, I don't care how much of the stuff you own)
I suggest that you spend your time future attacking the other side, they need it. (unless of course you are one of them)
Galearis
(11/7/01; 11:49:42MT - usagold.com msg#: 64868)
physical vs paper price separation
Latest from ebay
The physical market in silver from coast to coast in the United States.... A pretty good indication.
Note that there is only a little correlation with finished auction prices and (recent) paper spot and this is more one of direction. Generally down, but not significantly so:
snip
1286722575 100 TROY OZ. ENGELHARD .999+ SILVER BAR N/R $504.26 14 Oct-24 18:35
1286738638 4 oz .999 silver $100 replica note & more $30.00 1 Oct-24 19:07
1286838116 2001 4 TROY oz.$100 PROOF SILVER BAR !!LQQK!! $39.95 - Oct-25 05:13
1286927409 2000 4 OZ. .999 FINE SILVER AS A $100 NOTE $20.06 6 Oct-25 10:54
1286267890 100 OZ Johnson Matthey Silver Bar NR $474.00 7 Oct-26 15:21
1287386506 BRAND NEW - 100 oz. Sunshine silver bar $490.01 13 Oct-26 15:37
1287408690 100 Oz. Engelhard .999 Fine Silver Bar N/R $495.00 14 Oct-26 17:05
1288237109 JohnsonMattey 100 oz Silver Bar $480.00 11 Oct-26 20:58
1289108815 SUNSHINE 100 OZ .999 SILVER BAR - THB $462.00 3 Oct-27 07:57
1286656604 999+ Pure 100 oz Engelhard Silver Bar N/R $475.01 16 Oct-27 15:38
1287880878 1996 washington mint $100 silver proof, 4 oz. $24.95 4 Oct-28 06:05
1289608232 100 T.OZ. Silver Bar. Engelhard. W/Plastic $496.14 12 Oct-28 11:25
1288898677 1978 BU 1 oz. silver Mex. 100 peso Morelos $5.50 1 Oct-28 15:34
1288917355 100 OZ Johnson Matthey Silver Bar NR $483.85 16 Oct-28 16:23
1289003429 100 oz. Englehard Silver bar $496.02 5 Oct-28 19:16
1289851418 100 oz Silver Bar $495.00 - Oct-28 22:41
1288546290 1953 Ford F-100 - 1 Troy oz .999 Fine Silver $7.79 - Oct-29 16:57
1288554672 100 oz Engelhard .999 Silver Bar N/R $520.00 14 Oct-29 17:16
1288821832 999+ Pure 100 oz Engelhard Silver Bar N/R $490.02 15 Oct-30 12:02
1289790543 Johnson Mattey 100 oz. Silver Bar $471.00 5 Oct-30 18:44
1289071677 100 OZ. SILVER BARS FROM AN ESTATE DUTCH $460.00 7 Oct-31 03:06
1289154186 100 TROY OZ. ENGELHARD SILVER INGOT .999+ FIN $475.00 10 Oct-31 09:33
1288359471 100 Troy Oz. Engelhard Silver Bar,999,Bullion $532.76 13 Nov-01 08:43
1289618963 100 TROY OZ. 999+ ENGELHARD SILVER BAR $500.00 - Nov-01 11:51
1290036752 ENGELHARD 100 OZ. SILVER BAR .999 FINE $485.02 14 Nov-02 14:20
1290048542 BRAND NEW - 100 oz. Sunshine silver bar $485.01 15 Nov-02 15:04
1291600759 ***100 OZ .999 ENGELHARD SILVER BAR - THB*** $466.39 2 Nov-02 15:44
1290113841 100 Troy oz.Silver Bar.999 pure Englehard $479.00 1 Nov-02 18:19
1290233799 BRAND NEW - 100 oz. Sunshine silver bar $491.00 20 Nov-03 07:22
1291841286 100 OZ .999 SILVER BAR - THB $472.02 4 Nov-03 08:51
1290309305 2 - 100 oz pure Silver englehard bars .999 $921.00 6 Nov-03 11:22
1290311671 1 - 100 oz Silver Bar Engelhard $460.85 7 Nov-03 11:29
1290320280 999+ Fine Silver Engelhard 100 TR OZ Bar $490.00 6 Nov-03 11:54
1289710827 100 OZ. Engelhard .999 fine silver bar N/R $520.00 16 Nov-04 15:53
1291661562 100 oz SILVER BAR " ENGLEHARD $500.00 8 Nov-04 18:15
1291224035 2000 .999 SILVER 4 Troy oz. $100.00 NOTE $39.99 - Nov-05 16:11
1292254687 100 Silver Atr Bars 1 oz .999 $474.00 19 Nov-06 10:25
1291509940 1953 Ford F-100 - 1 Troy oz .999 Fine Silver $7.79 - Nov-06 11:44
1291556673 Bunker Hill Mining 100 OZ 999 Fine SILVER BAR $512.75 2 Nov-06 13:39
1291557335 999+ Pure 100 oz Engelhard Silver Bar N/R $495.00 16 Nov-06 13:41
1291558207 999+ Pure 100 oz Engelhard Silver Bar N/R $490.00 10 Nov-06 13:44
jb
(11/7/01; 10:47:05MT - usagold.com msg#: 64867)
reg howe and the boys.
good to still see the passion out their .that is why iam 100% invested in gold and silver and their stocks.
i still iam correct though.damm, i thought i would not say anymore on the subject.
BR549
(11/7/01; 10:12:39MT - usagold.com msg#: 64866)
Worker productivity rose in the third quarter by the largest amount in more than a year as businesses, coping with the sour economy, slashed workers' hours at the fastest pace in a decade.
http://www.foxnews.com/story/0,2933,38240,00.html
"Productivity - the amount of output per hour of work - increased at an annual rate of 2.7 percent in the July-September quarter, up from a 2.2 percent growth rate in the second quarter, the Labor Department reported Wednesday.
The third quarter's performance was better than the 2 percent productivity gain many analysts were expecting and marked the biggest increase since the second quarter of 2000, when productivity soared by 6.3 percent.
Productivity rose in the third quarter as businesses cut workers' hours at a 3.6 percent rate, the largest drop in hours since the first quarter of 1991 when the country was in the depths of its last recession. Output declined at a rate of 1 percent, the biggest decrease since the first quarter of 1993. "
BR-An example of Incentive--See how much harder the workers that did not get laid off now work. The ability to continue to put food on the table is quite a motivator.
BR549
BR549
(11/7/01; 09:58:24MT - usagold.com msg#: 64865)
Speaking of Money Exchangers-The 21st Century Economic War on Terrorism continues
http://quote.bloomberg.com/fgcgi.cgi?ptitle=Top%20World%20News&s1=blk&tp=ad_topright_topworld&refer=topworld&T=markets_bfgcgi_content99.ht&s2=blk&bt=ad_position1_topfin&middle=ad_frame2_topfin&s=AO_lYphO6QnVzaCBG
President George W. Bush is freezing U.S.-held assets of 62 people and organizations with links to terrorists that he blames for the Sept. 11 attacks on the World Trade Center and the Pentagon, the Treasury Department said.
That brings the number of people and groups whose assets have been frozen to 150.
The latest additions to the list range from an Islamic money exchange and its founders to a bakery. Bush is scheduled to announce the action this afternoon. ``There will be domestic implications to the announcement,'' White House spokesman Ari Fleischer said, declining to elaborate.
Targets of the assets freeze include Ali Ghaleb Himmat, who was born in Syria, and Youssef Mustafa Nada, born in Egypt. They are identified by the department as founders of the Al Taqwa money exchange, which is also on the list and is accused of funneling money into terrorist activities.
So far, 176 countries have pledged cooperation and 98 have issued orders to block assets of people and groups included in Bush's executive orders. As of last week, the Treasury Department said $24 million in assets had been blocked worldwide. That number is expected to grow as the assets of other frozen accounts are verified. "
BR-Cut the enemies supply lines of fiat worldwide and the terrorist's only alternative is to apply for welfare or go to work.
BR549
Chris Powell
(11/7/01; 09:49:16MT - usagold.com msg#: 64864)
Legal service issue in Howe case explained
I'd like to rebut the suggestion here and elsewhere that Reg Howe's serving legal papers on the Bank for International Settlements by mail in English rather than by personal service in German at the bank's headquarters in Basel, Switzerland, was negligent or incompetent.
As I understand it, the service issue involves an interpretation of the Hague Convention for international lawsuits. The convention allows for mail service in English. It also allows for countries to opt out of accepting that provision, as Switzerland did. But Howe argued that, under Switzerland's own law, the BIS has special non-national status, and it is, by its own admission, increasingly an international organization, not a Swiss corporation, the more so now that its private shareholders have been expropriated and governments own 100 percent of the bank.
As a practical matter, the BIS was deprived of nothing by mail/English service of the legal papers. The BIS had what the courts call "actual notice" of the lawsuit, was able to file its reply briefs in court in plenty of time and indeed did so, had its lawyer in court this week, and uses English in its own internal transactions. A member of GATA's legal team joked outside court that, when the German translation issue was raised, Howe should have asked the BIS lawyer -- an American -- if he spoke German.
There are two theories about the judge's siding with the BIS on the legal service issue. One might think that the judge was just looking for any device, no matter how trivial, for getting rid of the lawsuit. Or one might think that he was looking to the future and seeking to foreclose a technical and trivial avenue of appeal in the event that the case is allowed to proceed. In fact, the latter motive is as common in court as the former. So take your pick. We'll have to wait and see.
In any case, Howe was not negligent, and the service problem can be fixed -- admittedly at some cost, the cost of a long German translation -- if the case is allowed to proceed.
CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.
BR549
(11/7/01; 09:49:05MT - usagold.com msg#: 64863)
Reg Howe-Against All Odds
GATA's description of Mr. Howe sitting at the table by himself while an army of the money changers lawyers were on the other side reminds me of the opening to some of the years of the old black and white Perry Mason episodes. I can almost hear the music.
If the system fails us via OJ "dream team" lawyer technicalities getting the meat of the case thrown out, then the corrupt system has protected itself against the citizens right to know for many decades to come.
God Speed Mr. Howe.
BR549
USAGOLD
(11/07/01; 09:04:30MT - usagold.com msg#: 64862)
Today's Commentary: Gold Firms Somewhat as Uncertainty Attacks Markets
http://www.usagold.com/Order_Form.html
Ed. Note: Here we reproduce a portion of the Commentary & Review to give new visitors an idea of what goes on at our client-only page. Access is made available to prospective clients here with a free, one-time registration for access codes. See above. You'll also gain access to our News & Views: A Quarterly Review of Forecasts, Commentary and Analysis on the Economy and Precious Metals.#
11/7/01
In Brief:
Gold firmed in the early going after a night spent in positive territory and yesterday's .5% Fed rate cut. All eyes are now on Europe as the European Central Bank meets tomorrow to decide the fate of euro rates. If the ECB should decide to either leave rates where they are or lower less than .5%, the dollar could find itself in trouble. As it is capital is moving in the direction of gold and the euro this morning with gold trading up $1.30 and the dollar treading water. "It is possible that with real interest rates now negative...investors could look for alternatives. This would be very positive for gold,'' metals analyst Lawrence Eagles at GNI Research told Reuters.
U.S. stocks can't seem to find the proper reaction to the bigger than expected rate cut. Yesterday they were up albeit half- heartedly. This morning they are down. The trend out of stocks and into savings vehicles continues even with interest rates at 30 -year lows. As Milton Friedman was reminding us long before September 11th, there is an inflationary consequence to all this easy liquidity. Now on on top of it, we have a war economy and war economies tend to generate currency inflations. Like I have said on more than one occasion, the times seem more like the 1970s than the 1930s -- and most of us recall that in those years of the Viet Nam War, the Oil Cartel, the Misery Index and double- digit everything, we learned first-hand the value of gold as a safe-haven. The western economy hung by a thread in those years, and barely survived to the tell the tale. This time around we might not be so lucky.
Traders report strong physical gold demand particularly from the Mid East and Pacific Rim, and this should continue to put a floor under the market. It remains to be seen how the gold paper trade in London and New York react to these changes in the financial landscape. The gold carry trade is pretty much a dead soldier, but the paper players still have outstanding loans to protect, so continued attacks on the price through derivative plays cannot be ruled out. Private investors on the other hand find the the gift-wrapped price very attractive and continue to accumulate. For those who understand gold for what it is -- a long-term insurance against either inflationary or deflationary threats -- the current price range is a God-send.
Even so, gold appears to performing its contrarian portfolio role. While most assets tumbled following the chaotic events after September 11th and remain unstable, gold prices have bucked the trend rising roughly 5% rise (at the current $280 price). At one point, it was trading the $290 level. Many investors, it would seem, aren't taking the downside of the New Paradigm as a temporary and benign event. Meanwhile, stocks, bonds and saving vehicles have suffered from the dual onslaught of sliding values and the shrinking real rate of return on the dollar and appear to have been dealt any even less appealing hand as of yesterday.
As I said last report, perceptions -- driven by events -- are changing.
(More, go to link above) - - - - - - -
site steward
(11/07/01; 08:28:11MT - usagold.com msg#: 64861)
Eurosystem portfolio adjustments for week ended Nov. 2
With respect to the items we regularly examine here, the latest consolidated financial statement of the Eurosystem is nearly a carbon copy of the previous week.
The net position in foreign currency declined by EUR 300 million in value to EUR 257.1 billion.
Meanwhile, the value in gold assets declined by EUR 1 million on the sale of gold coins by a member central bank. The value of gold and gold receivable assets now stands at EUR 128.233 billion.
The trend continues... fading paper.
R.
Spartacus
(11/07/01; 08:11:47MT - usagold.com msg#: 64860)
War in Aghanistan could cost U.S. $1 billion a month
http://www.knoxstudio.com/shns/story.cfm?pk=SIEGE-WARCOST-11-05-01&cat=WW
..America's war in Afghanistan so far has racked up a bill of at least $400 million, and could rocket up to $1 billion a month for the duration of the conflict, according to defense budget analysts..
Spartacus
(11/07/01; 08:06:55MT - usagold.com msg#: 64859)
The Developing U.S. Recession
http://www.levy.org/docs/stratan/recess.html
...Barely a year ago, it was widely accepted and tyrannically projected that the U.S. growth rate had been permanently raised, the business cycle had been abolished, the good times were here to stay, fiscal policy should never be used as an instrument of policy, the budget should always be in surplus, and judicious adjustments to short-term interest rates by the Federal Reserve were all that was needed to keep noninflationary growth permanently on track....
Clint H
(11/07/01; 07:58:13MT - usagold.com msg#: 64858)
Leigh msg#: 64855)
Leigh
You said it in three words, "jb's sniveling criticism."
A big smile now helps ease the anger.
Clint H
(11/07/01; 07:50:52MT - usagold.com msg#: 64857)
nickel62 msg#: 64853)
jb a cheap shot then!
nickel62
Thanks for saying what most of us feel.
CoBra(too)
(11/07/01; 07:43:55MT - usagold.com msg#: 64856)
Nickel62 and Leigh -
I've been too appalled to trust myself in responding. So thank you for speaking up.
It's time to say thank you to Reg, Chris and Bill for their great effort and it's time to help GATA, wherever possible.
Best cb2
Leigh
(11/07/01; 07:07:51MT - usagold.com msg#: 64855)
nickle62
Thank you for your impassioned response to jb's sniveling criticism of Reg Howe yesterday. Reg Howe is a hero, and his noble quest is worthy of all respect.
Black Blade
(11/7/01; 06:35:44MT - usagold.com msg#: 64854)
Investors pull $29.5 bln from U.S. stock funds
http://biz.yahoo.com/rf/011029/n29162859_2.html
Snippit:
NEW YORK, Oct 29 (Reuters) - A mutual fund trade group said on Monday that investors pulled a record $29.51 billion from U.S. stock mutual funds in September, similar to earlier estimates from data tracking firms. The net withdrawals, a record in dollar terms, came as the stock market sagged before and after the Sept. 11 attacks on the United States. The previous record monthly net withdrawal was a revised $20.67 billion in March.
Black Blade: "Interesting Times" indeed.
nickel62
(11/7/01; 06:26:56MT - usagold.com msg#: 64853)
jb a cheap shot then!
If you have no more to say on the matter of Reg Howe taking on a team of some of the most powerful interests in the US government and their financial friends. I suggest you owe Reg Howe an apology for the heroic fight he is waging. Yes he is waging it alone, because the rest of us are sitting here pontificating about it when he is actually fighting it. To call such a man a fool is beyond bad taste it is insulting. To question why he has not dotted every I and crossed every T by not having the arguements translated into German for the BIS is comical.
How much have you contributed to the cause bj? Perhaps you haven't read the research that went into his case or the effort it took to uncover the evidence to support arguements strong enough to perseveer against these formitable legal opponents. I think the efforts of Reg Howe and those assisting him are monumental in the elegance of their power and focus.
To say he is remiss in not anticipating every possible objection or requiement is to ignore the size of the task he has taken on. To have you take a cheap shot at a man who is fighting for such basic American values is unacceptable at least to me.
Black Blade
(11/7/01; 06:21:35MT - usagold.com msg#: 64852)
Axed workers asked to return bonuses
http://www0.mercurycenter.com/premium/business/docs/delevett06.htm
The article depicts "Grisly" tales from the "Bone Pile."
Black Blade: Add insult to injury! These nonessential "Bones" are cast aside to let their bleached "Bones" rest on the "Bone Pile" and the corporate ghouls come back to pick at these carcasses. Of course they have themselves to blame if they did not prepare for changing times as any prudent person should do. "Interesting Times"
ORO
(11/7/01; 06:20:19MT - usagold.com msg#: 64851)
Mr Gresham - quality and quantity
The one shared characteristic of fiat debt money is that it has a central bank to issue it and a set interest rate at which it is issued.
The mere presence of the central bank creates an inefficiency in the interest rate setting mechanism of the market where the central bank moves interest rates at anything from an honest best guess to a manipulative interference (too low - to benefit banks gaining market share and to help bail debtors, too high - in order to create havoc and force foreclosures in favor of creditors). Also an issue of creating debt traps with too low an interest rate, vs. shuting them with too high a rate.
The fiat monetary system with the least input from the decision makers is the highest quality one. Characteristically, the monetary system with the lowest bank market share in lending is the most likely to produce the "best" fiat money.
Furthermore, I often write of the problem of debt supply and demand balances where credit expansion into a positive balance builds future inflationary pressures, and contractional conditions into a negative balance release the inflationary pressures into higher prices through the elimination of the demand for money by the defaulting debtors. Thus a monetary authority that maintains a balance close to 0 but clearly negative would be certain of having released much of the built up inflationary pressures into price rises, while avoiding undue formation of future price rises.
The focus on after-the-fact price effects rather than structural monetary ones is the sure way to prevent a stable system, as during low price inflation periods the monetary expansion is allowed to proceed at any pace till prices rise, which brings upon the central bank the necessity of tightening, thus bringing up default rates, which release inflationary pressures built up during the low interest rate and low price increase period. Furthermore, the focus of the supply demand estimates would be best if on the external markets - outside the domestic jurisdiction of the central bank - rather than solely within the domestic arena. Thus the much more sensitive international markets in goods, direct investments, securities and currencies would react much more quickly than the domestic market.
Though there is no CB I know of that sticks strictly to this methodology, the Fed under Greenspan seems to have accomplished something like it for quite a while. The Japanese have been at the totally nether extreme, while the EU has dedicated itself to backward viewing.
Another odd issue, is that the EU, with no practical prior experience, has allowed foreign investment to turn its income accounts inside out through an absurd 13.5% growth rate in international bank lending to Europe since 1985. All this would have been fine if the EU counterside financial community were able to produce successful investments in its own foreign and domestic endeavors. But it can't and hasn't, though experience has improved the results some. Foreign investors in Europe still outperform domestic investors (by 1%, improved from 2% one decade ago), as is the case in Japan (was and remains a 2% underperformance). In US industrial investments, they have an ROA of 5%, vs. domestic US industrial performance of 7%. In the later 90s the US industrial investors lowered performance (due to over-investment) to 6%, European performance has not improved. In both the Japanese and European cases, the reason for this underperformance is the persistence in political rather than meritocratic allocation of control over investment capital, which is caused by direct government interference and participation in ownership (or direction, in the case of Japan) of financial institutions, and of industrial concerns.
The result is a 82 billion euro negative income account for the EMU, which did not seem to be improving as of the 2000 data.
Black Blade
(11/7/01; 06:12:07MT - usagold.com msg#: 64850)
Will U.S. emulate Japan's long slide?
http://www.msnbc.com/news/653960.asp?0si=-
Snippit:
The U.S. economy is staring down circumstances similar to those that plunged Japan into a decade of stagnation. With each passing week, the similarities increase. In the 1980s, Japan was considered the model capitalist economy; in the 1990s, the U.S. held that distinction. In both cases, the good times ended with the bursting of a stock-market bubble, pricked, at least in part, by a nervous central bank. In both cases, predictions of a quick turnaround proved to be wrong.
To some analysts, the large amount of consumer debt outstanding in the U.S. is the ticking time bomb that could rival the bad loans dragging down Japanese banks. American households borrowed freely and dipped deeply into savings during the 1990s. In good times, with wages and stock portfolios rising, the situation seemed manageable. But now, as income-growth slows and mutual funds shrink, the burden could spin out of control. The Fed estimates that the household debt-service burden - the ratio of debt payments to after-tax income - rose above 14 percent earlier this year for the first time since 1987. At about the same time, the number of Americans filing for personal bankruptcy hit a record 390,064.
Black Blade: Hey tg, there's a lagging indicator. OUCH! Now that's both "Interesting" and "Grim." Time to get hard asset porfolio insurance while Gold and Silver are still cheap. It does not appear that we have seen a "Bottom" quite yet.
Emiledaniel
(11/07/01; 05:19:15MT - usagold.com msg#: 64849)
Support a free Goldmarket NOW !!!!!!!!!!!!!!
http://www.thepetitionsite.com/takeaction/365824991?sign[partner_userID]=722488633&sign[mem
LeSin
(11/7/01; 03:10:57MT - usagold.com msg#: 64848)
ASEAN Free Trade Area/Block Progress - "More Problems for US$"
http://news.ft.com/ft/gx.cgi/ftc?pagename=View&c=Article&cid=FT3JOH15QTC&live=true&useoverridetemplate=ZZZUGORQ00C&tagid=IXLQZUBUICC&subheading=asia_pacific
Asian leaders back free trade area with China
By John Burton in Singapore
Published: November 6 2001 20:19 | Last Updated: November 6 2001 20:22
South-east Asian leaders on Tuesday endorsed a proposal to create a free-trade area (FTA) with China over the next 10 years in what would be the first step towards a larger east Asia trading zone.
The decision taken at the annual summit of the Association of South-East Asian Nations in Brunei is aimed at reducing the region's trade dependence on the US.
Beijing advanced the proposal at last year's Asean summit in Singapore, in part with a view to easing nervousness in south-east Asia about the growing competitiveness of China as a manufacturer and recipient of foreign direct investment.
The endorsement of the FTA proposal comes when south-east Asia is suffering an economic slowdown due to falling exports to the US, which has prompted calls for closer economic co-operation within Asia.
"For us to depend on the US alone as a market for growth for east Asia will be much more difficult in the future, because the US economy is going to slow down," said Goh Chok Tong, Singapore's prime minister.
Asean believes an FTA agreement with Beijing would further open a potentially large market, with China growing rapidly and about to enter the World Trade Organisation.
But some Asean nations still have concerns that their resource-based economies would be overwhelmed by manufactured products from China.
"An FTA with China could prove to be unworkable since there is already resistance to free trade within Asean, with some countries wanting to protect local manufacturing industries such as Malaysia with its car industry," said Kostas Panagiotou, regional economist with Kim Eng Securities in Singapore.
Asean is still having difficulty agreeing the scope of an internal free trade agreement, due to come into full effect next year.
Officials will now study the form and scope of the FTA, which would create a trading bloc of nearly 2bn people and a combined gross domestic product of $2,000bn.
China has identified five important areas for co-operation under FTA, including agriculture, information technology, human resources, direct investments and development of the Mekong river basin.
South Korea, fearing it could be frozen out of the region, has proposed a wider east Asia FTA that would extend to all of north-east Asia, including Japan. A final report on that proposal is scheduled to be discussed at next year's summit in Cambodia.
However, Japan has indicated it is not enthusiastic about an east Asia FTA as it pursues bilateral FTA agreements with Asian nations, such as a recently concluded pact with Singapore.
One reason for Tokyo's reluctance is that an east Asian FTA could open Japan to increased agricultural imports, which would anger the nation's politically powerful farming lobby, according to analysts
The Invisible Hand
(11/7/01; 01:56:18MT - usagold.com msg#: 64847)
IMF takes over politicians' role to pressure ECB to cut rates
http://www.thetimes.co.uk/article/0,,5-2001384856,00.html
TrailGuide quoted in msg#130 of the Trail:
---- "Politicians have been scared of publicly pressing the independent ECB to act for fear it may dig in its heels and remained cautious Monday" ----
Here's from the link above:
THE European Central Bank (ECB) has come under mounting pressure to follow the lead of the US authorities and cut interest rates again after the International Monetary Fund (IMF) called for new reductions in eurozone borrowing costs.
The call by the IMF came as the US Federal Reserve announced that it was cutting its key interest rate by another half-point to 2 per cent, hardening speculation that the ECB would give in to demands for lower rates at its policy meeting tomorrow. In its annual assessment of the eurozone, the IMF said that it "saw fresh room for further monetary easing, particularly if the euro appreciates". This view was widely-shared by market analysts, who have become increasingly concerned about faltering European growth.
…
Belgian
(11/7/01; 01:49:34MT - usagold.com msg#: 64846)
Morning
POG 280,15$
And holding, despite the IR's zero-level, dive. This is of some significance. A "signal" ? Have interest rates bottomed ? Is Gold disconnecting from the virtual deflalala ? Will the ECB only lower by 0,25% on thursday and put more pressure on the dollar ? And how sure can Duisenberg be of an inflation below the 2% for 2002, without knowing what OPEC's plans are ? Is Pakistan, the next one, to fall under Uncle's rule (pipeline) ?
Is the China/US -trade of 120 billion $, out of a GDP of 10 trillion $, going to compensate for the trade deficit ?
And why should a euro-rate-cut, be of any significance, to stop the global contraction ?
What happens with the interest rate derivatives, if the bottom has been reached and volatility drops to near zero ?
Is it the start of the dollar >>> euro (Gold)carry trade ?
Devalue the dollar and pay all dollar-debt back with worthless paper ? Just, put some upwards momentum on POG and all the water flows where you want it ?
Panda, are you having a meeting with the Rothies ?
Interesting times...isn't it BB ?
Netking
(11/7/01; 01:34:55MT - usagold.com msg#: 64845)
Gold's real test starts as rates turn negative
http://www.mips1.net/MGGold.nsf/Current/4225685F0043D1B285256AFC0075FA55
Good news for Gold & Silver bugs;
After an accumulation of bad economic data, the Federal Reserve did the only thing it knows to do – cut interest rates.
This time by 50 basis points to 2 per cent for the federal funds rate, or the interbank overnight rate, and that was matched by a reduction in the discount rate, the Fed's lending window, to 1.5 per cent. But after ten rate cuts, the highest number in a single year, and with a fast growing money supply, confidence in the Fed's ability to revive the economy is waning.
That's good news for gold bugs. Real interest rates are now negative since the consumer price index is running at an annualized 2.6 per cent. That is invariably good for gold but the yellow metal has had a hard time pressing its case as a safe have since September 11. Nevertheless, things are different if you have patience and there is every reason to expect an improvement in the gold price.
The Monetarist theory that underpins the manipulation of interest rates cannot explain why the aggressive easing has not already had the desired effect. Policy makers will no doubt be casting their eyes toward Japan where no amount of monetary and fiscal easing has pulled that economy out of its decade old recession. Negative real interest rates are a nasty inflection point for central bankers.
There is growing concern that the Fed is manufacturing yet another boom-bust cycle. But this time it is almost guaranteed to come with untamed inflation. Similarly, fiscal stimulus measures are likely to kick in too late and could create unnecessary volatility in monetary policy while stoking additional inflation.
All excellent signals for gold. But the dollar will have to fall first and there are technical reasons to think that is going to happen, along with a strong upsurge in gold equities. Gold has no safe-have status? Hmmm. Let's see.
------------------------------------------------------------
Your homework; study the graphs in the link . . . for those who has ears to hear, let them hear.
- Netking
Black Blade
(11/7/01; 00:50:52MT - usagold.com msg#: 64844)
OPEC May Cut Output by 1.4M Barrels
http://dailynews.yahoo.com/h/ap/20011105/wl/opec_oil_1.html
Snippit:
LONDON (AP) - Alarmed by a relentless slide in oil prices, OPEC members are likely to agree to cut production by as much as 1.4 million barrels a day when the cartel's delegates meet next week, an OPEC official said Monday. Such a cut would be up to 400,000 barrels a day larger than the potential reduction called for in recent weeks by members of the Organization of Petroleum Exporting Countries. OPEC members are considering cutting output by 1.2 million to 1.4 million barrels a day, or 5 percent to 6 percent of their official production, said the OPEC official, speaking on condition of anonymity from the group's headquarters in Vienna, Austria.
Black Blade: Non-OPEC producers are at near capacity, however, Mexico, Norway, and Russia announced that they won't cutback. It doesn't matter as they have no room to expand anyway. OPEC may have to cut production as much as 2.5 million bbl/day to have much effect. Even then some will likely cheat on their quotas at that low level of production. Could get "Interesting" as the war could easily expand into the petroleum producing region as Islamists tend to view the war as a crusade of Christians against Moslems. "Interesting Times"
Golden Dreams All!
Black Blade
(11/7/01; 00:35:34MT - usagold.com msg#: 64843)
Bank of Japan monetary policy
http://biz.yahoo.com/rf/011107/t78039_1.html
Snippit:
TOKYO, Nov 7 (Reuters) - The Bank of Japan is facing calls to adopt a more aggressive
monetary policy to revive the world's second biggest economy as a slowdown in the United States pulls Japan closer to its fourth recession in a decade.
WHAT IS ACTUALLY HAPPENING?
- Because of their bad-loan problems, banks have been reluctant to expand lending despite abundant, cheap liquidity.
- The banks have shunned riskier borrowers, and healthy borrowers are opting to pay back their loans since those liabilities become more expensive in a deflationary environment.
Black Blade: Maybe the US isn't too far behind.
tg - maybe it is like two frantic people drowning in the ocean each grasping the other to stay higher out of the water, yet both are doomed. "Interesting Times"
tg
(11/7/01; 00:09:01MT - usagold.com msg#: 64842)
blackblade
http://www.bearforum.com/cgi-perl/bbs.pl?read=198292
Go to the link above and you will see a graph of how the S&P 500 has been following the Nikki with a lag of 2 weeks.(not the other way around). A reversal for the S&P looks no more then a week away.
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