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ARCHIVED DISCUSSION FROM 2/7/2001
All times are U.S. Mountain Time

(Yesterday's Discussion.)

SteveH (02/07/01; 23:44:53MT - usagold.com msg#: 47752)
Good one CarlH...
http://www.gold.org/Gra/Statistics/Gold_560.gif
Continue with your line of thought. See where it ends. (se the chart)

Nikkei drops below 13,000 for an instant today. Not good.

Mr Gresham (02/07/01; 23:40:15MT - usagold.com msg#: 47751)
Carl H
The picture I get from your excellent presentation of the known facts is that of a gunman (BBs) entering the bank and pointing the gun at his own head, demanding the tellers hand over cash. "If you don't want my blood all over your nice, polished marble floors..."

My unresearched impression of BBs is that, while they are big names in the gold world, or subsidiaries of major banking institutions, that their bankruptcies could be cut loose from their corporate parents. Can anyone enlighten on this?

Playing the CBs off against the mines, ver-r-r-y clever. "He's gonna dump his gold. But I can lock you in at this price now. Last chance, whaddya say?"

The 1996-97 POG dive down toward the cost of production could have been a move on the mines.

The CBs could have been holding off BB-induced financial collapse while awaiting the Euro. Question to any: Were all of the CBs Euro enthusiasts? Or reluctantly dragged to the party? Or maybe Germans walked -- and bargained from -- the middle, to see if they would increase their power over their DM predecessor?

Yes, CBs would try to do this with the smallest expenditure of gold, as I think FOA has indicated most "sales" to be internal transfers.

One thing, if BBs have now "significantly reduced their derivative positions", how did they accomplish this? This means buying back calls? Who sold them? Or, just buying time allows calls to expire (were most of them short-term?)

The Unwinding, ah yes, the unwinding! FOA has indicated this, that the CBs will not mind the price hold-down, because they will gain many times the value back.

They can put forward the new currency and see if it flies without gold backing. Profit center. Plan B is to slip some credibility behind it using the gold reserves, virtually, or physically, if necessary.

It occurs to me: Oro's objections to Europe's economic methods point to the new currency as possibly a "reserve currency franchise opening" the Europeans saw they could seize from the U.S. and profit from in order to support their ways of living, and NOT have to radically compete with U.S. ways. The cushion that they've seen Americans coasting on for 30+ years.

And with the currency, and gold, they can "re-colonize" all those young, energetic peoples around the world who do such good, productive work so cheaply!

Simply Me (02/07/01; 23:06:49MT - usagold.com msg#: 47750)
oooops
......In the case of the Treasury, I believe the Fed Banks must pay face value.......should have read as follows:
In the case of the Treasury, I believe the Fed Banks must pay them face value for coins.
sorry
simply me

Simply Me (02/07/01; 23:02:21MT - usagold.com msg#: 47749)
@Randy @Journeyman @SLATT RE: Sac $ Profits? @CoBra2, too!
Hi Randy,
Duties took me away from the forum for awhile and, in my absence, Journeyman presented just the explanation I was looking for. I didn't remember all the details. My incomplete answer would have been some blather about the Fed's seniorage(sp?), which I believe is the difference between what the currency note costs the Fed and the face value of the note. In the case of the Treasury, I believe the Fed Banks must pay face value. Therefore a $1 coin benefits the Treasury, whereas the $1 benefits the Fed.

That very issue, though, is what keeps me dogging the goldmine issue. Before "money" came from the Fed or the US Treasury, money came from goldmines and it was extremely profitable. International money, the kind no one can devalue or inflate, still does come from goldmines. Only the Fed and the Treasury, as an arm of the US government, have worked very hard to blind us to that fact.

As for whether "seniorage" is profit, if you're ahead after the transaction, isn't that profit, no matter what it's called? Those "benefits" wind up in someone's pocket. Was it John D. Rockefeller who said, "I don't own anything. I control everything." ? He had a few non-profit organizations under his control, I believe.

Hi Journeyman,
Thanks for explaining that for me. It got me off the hook with Randy! ;o As you said, I had the basic idea, but I surely needed someone to help me with the particulars!

I don't really think the US Treasury is looking to issue collectible coins so that people will sock them away. I think they really do want the coins to circulate. I just think the Treasury is trying to chop a little off the Fed's seniorage. Money issue or power issue, I don't know. Maybe they're the same issue.
"What are your thoughts on that, Hobson?" (Dudley Moore, "Arthur")

Hi Stocks, Lies and Ticker Tape,
Why not? It works for the Post Office. But I don't think you have to worry about a Bill&Hill coin (which side is tails?).
If your target market can't fill out a ballot properly, they probably can't figure out how to put a coin in an album, either. If the Mint ever starts producing Bill&Hill coins, I want to open an Elmer's Glue & Scotch Tape concession in every bank.

Hi CoBra2,
"Thanks for noticin' me." (Eyore, "Winnie the Pooh")

simply me

Mr Gresham (02/07/01; 22:16:26MT - usagold.com msg#: 47748)
Sierra Madre (02/07/01; 16:28:17MT - usagold.com msg#: 47709)
Wow! You read every little cranny in my mind!

All the known entities -- dollars & govs & BBs & CBs & GSs & Barricks -- are used, and then flushed.

Those who THINK they are in "The Circle" are probably scurrying around to find out if there is a more inner Club they're being cut out of, or if they know of it, trying to find out the price of admission.

It's the model of corporate asset looting we have watched for 20 years now, brought to its finest moment. Shareholders, citizens & workers are the patsies.

The pyramid of hierarchy has to scramble its old institutions and re-form, in order to shake off recent accretions of climbers, so that "exclusive" can once more truly mean "Exclusive".

Escape the matrix!

Canuck: It's a good time to be one of the small fry...

R Powell (02/07/01; 22:03:22MT - usagold.com msg#: 47747)
Carl H

If we only knew who held what positions and in what magnitude in regard to options and futures and debts owed from the gold carry of many years. If all this were available and we could watch as these forces changed day by day, then we could almost predict the POG with some certainty and timeliness. I believe mining company reports give figures of forward sales which is some insight and often mentioned in terms of "hedged" meaning bad and "unhedged" meaning good investment but this is only part of the puzzle.
Perhaps the next best thing is to keep a eye on the activities of those players who might have a clear view of what we can not see. When the rabbit freezes and the squirrel runs for the nearest tree, then something is about to happen even though it might not yet be clear what's coming. Thus we watch gold stocks and the likes of Goldman Sacks.
I think your scenario deserves study.
Thanks Rich

JMB (02/07/01; 21:49:35MT - usagold.com msg#: 47746)
R Powell
Your 47745 is Hall of Fame material.

R Powell (02/07/01; 21:43:42MT - usagold.com msg#: 47745)
Journeyman

"How do they make change"
That's why the good Lord created silver!
Rich

JMB (02/07/01; 21:42:50MT - usagold.com msg#: 47744)
Journeyman
Gold is Gold, but I think the Comex wants it to be .9999 pure. Maples can be used but not Eagles, I think.

Rich: Maybe Goldman Sachs is doing it in their own account. I remember seeing Bill Murphy state a number of times that one Rat would jump ship and start the Run....Bill thought it would be GS. If Bill's right, this could be the start of something wonderful. ho ho, wouldn't that be something to see?
TOCOM here we come....I can hardly wait. I gotta settle down, I tend to get carried away, sorry.

Paul O'Neill on CNN now

R Powell (02/07/01; 21:31:35MT - usagold.com msg#: 47743)
Journeyman

Yes, of course, many big players might take delivery without the dust being disturbed. Most all of COMEX is a paper chase. It's very concievable that the grandaddy of all squeezes could unfold without much profit paid to Brinks for trucking fees. I think this more likely in silver than gold but one should lift the other and either should attract investment from the unknowing momentum following money.
Rich

Journeyman (02/07/01; 21:24:21MT - usagold.com msg#: 47742)
Another question @ALL

Is COMEX gold fungible? They can "fingerprint" gold now, but does it matter WHICH gold you gain title to - - - or is it strictly commoditized?

How do they make change?

Regards,
Journeyman

R Powell (02/07/01; 21:21:50MT - usagold.com msg#: 47741)
Journeyman/title

COMEX will allow you to make arrangements to pick up and carry away your physical gold from specified points at a specified time or give you a certificate of ownership and store it for you for a fee I'm sure.
Most contracts (about 98%) are simply offset at a profit or loss before delivery but there seems to be more notices of delivery than normal. That's what all this excitment is about. We all know there are many times more contracts in play than can be honored so when some are looking to take delivery of physical, visions of a short squeeze dance through our heads. The contracts will be honored, what will be at issue is, at what dollar price?
If enough long positions want delivery and there isn't enough to go around then some of the longs will have to be persuaded to offset for dollars rather than for physical.
At what price per ounce will you sell back the 100 ounces you have bought? Kinda makes you think of poker, doesn't it? I'd love to know who Goldman's client is that is taking physical delivery?
Rich

Journeyman (02/07/01; 21:20:37MT - usagold.com msg#: 47740)
What I think @JMB

Hi JMB!

What I think is that gold rarely enters COMEX and even more rarely leaves it. It's too "risky" to take your pick-up in and pile it high - - even Brinks. And where do you keep it?

If this is correct, this means nearly all "delivery" doesn't even disturb the dust on any of those gold bars in the COMEX warehouses.

This would explain the 2.5 month difficulties the Kitco poster had, since this would be an unusual operation for COMEX.

But remember, I know next to nothing about COMEX operations, so I'm going on logic only, a poor substitute for facts!!!

Regards and TIA,
Journeyman

JMB (02/07/01; 21:04:35MT - usagold.com msg#: 47739)
Journeyman
Here's two additional terms to throw into the mix.
1. Tender
2. Retender
The fellow at kitco considered the "pickup" but decided on Brinks for delivery.

Remember, only The Shadow KNOWS for sure. But let's hear your conclusion.

R Powell (02/07/01; 21:03:29MT - usagold.com msg#: 47738)
Carl H/ Section 5 (47730)

Your section 5 reasoning would seem to set up a situation where the Central Banks recover their physical gold and the Bullion Banks have their debt repaid regardless of the POG. Both could even be totally uncaring about the price in dollar terms although the Central Banks could mark to market their gold as a more precious (in dollar terms) asset. The Bullion Banks would probably want to hold more than enough options to repay their debt as they will know that the POG will skyrocket. They'll want some for their own pockets.
In fact, both will be happy to see POG go up. Who would be left to want the price to remain low? Both of them would be promoting and advocating a higher price. This I'd like to see, and they said it would never freeze over!
Rich

JMB (02/07/01; 20:53:49MT - usagold.com msg#: 47737)
TREE IN THE FOREST
Tree: I think Rich has a good point there.

Journeyman (02/07/01; 20:53:40MT - usagold.com msg#: 47736)
What "delivery" is?? @Tree In The Forest, ANYONE

Hi TIF, ANYONE!

COMEX operations is something I know next to nothing about, so one question I have is:

What does "delivery" mean? Does it mean a "title" to gold just changes hands? That is, does this mean that no gold moves, not even from shelf to shelf within the COMEX warehouse?

Or does "delivery" mean folks drive up in their pick-up trucks (or hire Brinks) to come to COMEX and load the gold on these vehicles for delivery outside the COMEX warehouses entirely?

Or does "delivery" mean both? If so, how much leaves on the trucks compared to how much doesn't move?

Related: How often does gold move (on trucks) from outside COMEX warehouses into them? How much?

The question has come up several times here, and as far as I know, no one has answered it.

I think I know the answer, but I'd rather KNOW I know!

Regards and TIA,
Journeyman

Chris Powell (02/07/01; 20:53:21MT - usagold.com msg#: 47735)
Latest from GATA delegation in South Africa
http://groups.yahoo.com/group/gata/message/647
Support is growing down there.

To subscribe to GATA's dispatches
by email and get them immediately so
you don't have to go look for them,
send an email to:

gata-subscribe@yahoogroups.com

Chris Powell (02/07/01; 20:51:07MT - usagold.com msg#: 47734)
Gold Fields takeover talk
http://groups.yahoo.com/group/gata/message/646
Indaba conference buzzing about possible takeover
of Gold Fields.

To subscribe to GATA's dispatches
by email and get them immediately so
you don't have to go look for them,
send an email to:

gata-subscribe@yahoogroups.com

R Powell (02/07/01; 20:46:32MT - usagold.com msg#: 47733)
Stoppers on COMEX / Tree in the Forest

Question concerning stoppers. If intent to accept delivery is given, wouldn't that remove one contract from open interest? Thus many contracts may have been stopped by those desiring delivery and then COMEX would reduce O.I. by that number of contracts just as if they had been offset. No? Good question. Anyone know for sure?
Rich

JMB (02/07/01; 20:34:15MT - usagold.com msg#: 47732)
RossL
Could it be that the Gold Receipts are considered to be as 'good as Gold'? Maybe the Receipt Holder can take the paper to the Bullion Bank where he borrowed the Gold, hand it over, and his debt is paid. The Bullion Banker is happy because he knows the Comex is a very reputable place and the Warehouse is second only to Fort Knox, so he jumps up, clicks his heels together and yells "Happy days! I got my Gold back!"
Come to think of it, the Gold Receipts are the only legitimate money in the world and Goldman Sachs is our savior. HA HA

RossL, you still there? What do you think? (cxl the GS part)

R Powell (02/07/01; 20:31:51MT - usagold.com msg#: 47731)
Carl H Re: Scenario

Excellent analysis. I wish I could give some definitive answers but I can't. I can, however, say that a fellow named Don_L at the Gold-Eagle forum has for a long time been analysing the call to put option ratio in gold. I believe he's trying to determine if future price movement can be foretold using this ratio. He offers (by e-mail) to share his work. He may know some of the answers OR where to find some of the answers you are looking for. I believe he studies this ratio by the month with an eye toward the influence of the ratio at option expiry on the POG.
Your idea appeals logical to me but lets see what better, more knowledgable minds have to offer. I hope ORO responds here, among others.
Rich

Tree in the Forest (02/07/01; 20:28:54MT - usagold.com msg#: 47730)
JMB, RossL Something is up at Comex
The way the Comex works is that there is a first notice day which is usually at the end of the previous month or the beginning of the contract month in question. For example, for the Feb gold contract, FND was Jan 31. This is the first day that stoppers declare their intentions to take delivery. Then delivery starts from Comex on the first delivery day (FDD) which for Feb is Feb 1. Then there is a last trading day (LTD) which for Feb is Feb 26. This is the last day that contracts are allowed to trade. Next comes the LND, last notice day which is the last day that stoppers can declare their intention to take delivery. This is Feb 27. Finally we have LDD, the last delivery day by which Comex must cough up the commodity. For the Feb contract this is Feb 28. There is no waiting interminably for delivery. It's a standardized commodity contract under law. If they don't deliver on LDD, it's a breach of contract, default. Now, according to the figures off of your link, we have currently 4897 stoppers in Feb. But this can't be for the Feb contract because open interest is down to 150 contracts. March has no OI. So this must be for April, but that would mean that stoppers are calling for delivery before FND. So we have something up at Comex. Curiouser and curiouser!

Stocks, Lies, and Ticker Tape (02/07/01; 20:24:15MT - usagold.com msg#: 47729)
Simply Me,.........Sacagewea $
That is a scary thought! To think that the mint could be following in the footsteps of the USPS in issuing gozillions of new coins just to have collectors squirrel a few away yielding a profit like a postage stamp not canceled! I fear the Bill & Hill coin may be arriving soon, ARRRRGGGGGHHHHHHHH!!!!!!

goldfan (02/07/01; 20:22:14MT - usagold.com msg#: 47728)
@ ORO, John Doe, Journeyman
Thanks for your responses to my posts.
Very interesting link John Doe.

Back to my drawing board.

Goldfan

Carl H (02/07/01; 20:05:56MT - usagold.com msg#: 47727)
Gold Manipulation Scenario
Gold Manipulation Scenario

This article is an attempt to put together a story that fits the facts that I know about the manipulation of the gold market. I would greatly appreciate it if anyone reading this would point out any errors on my part.

First, if there is any question that the gold market is being manipulated, I suggest reading the GATA lawsuit filing at www.gata.org and the articles by Dr. Clawar on Gold-Eagle (eg
http://www.gold-eagle.com/editorials_01/clawar020201.html )

Section 1 � Bullion Banks Establish the Gold Carry Trade

From what I have read, it seems that a few years ago a number of Bullion Banks started borrowing gold at interest rates of around 1% from Central banks. This gold was immediately sold on the spot market and the money and invested it in higher yielding investments. This type of operation is referred to as a carry trade. This practice went unchecked and has reached a point where at least 6000tons and probably as much as 10000tons of gold are owed to the central banks. To put these numbers in perspective, annual world wide mine production is estimated to be about 2500tons.

Section 2 � Lining up the Gold to Unwind the Carry Trade

I consider the above paragraph to be fairly well established information. Now, I will speculate for a moment. If I were the bullion bankers and was in this situation, I would want to get my hands on a tremendous amount of physical gold at cheap prices. As far as I know, only the central banks and mining companies have large amounts of physical gold. In the case of the mining companies, it is still in the ground. I will assume here that the central banks would be very reluctant to let the bullion banks default. It would show how stupid or corrupt the central bankers are and it might be a big enough scandal to change the outcome of some elections. Ok, so this means that I have to convince the mining companies to sell me all the gold they produce for the next several years at prices close to what they are currently. So, how would one go about convincing the mining companies to sell their future production? You'd either have to convince them that the price of gold was going to stay low for the period of time for which you wanted them to sell you the production or you would have to coerce them into selling future production. To accomplish this, you would have to convince them that there was a large supply of gold that was going to be dumped on the market. As stated above, the only other large holder of gold is the central banks. So, you have to convince the central banks to drive down the price of gold and act like they are ready to dump much more gold.

So, the question then is how to separate a central banker and his gold. Simple, create a potential crisis of a magnitude that it will force him to sell gold to prevent it. This is easily done by simply writing a huge gold call options (or surrogates thereof). Then, if the price of gold rises, the Bullion banks will fail and probably take the financial system with them. This compels the central banks to cap the price of gold at a level that less than the cost of production for many mines. This forces those mines to hedge or go bankrupt. The Bullion Banks can then acquire the forward production at prices near the cost of production, or to acquire the bankrupt mine. What is even better is that hedging will help hold down the price and force other mining companies to hedge.

Section 3 � Depressing the price of Gold

Now I will step into the Central Banker's shoes. I have just been posed with a potential crisis that requires me to cap the price of gold for some length of time while the options that the Bullion Banks are holding expire. How would I accomplish this? The best option would be to talk gold down by calling it a barberous relic etc. The next best option would be to convince or coerce other central banks that are not aware of what is going on to sell or lend their gold out. This might be accomplished by arranging sweet arms deals (eg Kuwait), or putting it as a string on some disaster aid (eg Bangladesh flood aid). The third option would be to depress the price by manipulations in the paper market for gold. Finally, as a last resort, I would sell physical gold on the New York market. The New York market is considerably smaller than the London market and should require less physical gold to manipulate. The starting price is London will be influenced by the closing price in NY. (see Dr. Clawar's work cited above.)
As an added benefit to me as a Central Banker, manipulating the price of gold will help to conceal and contain inflation.

Section 4 � When can the Price Cap be released?

When one or perhaps two conditions are met, the price cap on gold will be released. The condition that must be met is that the Bullion Banks must have significantly reduced their derivative positions. One would suspect from http://www.gold-eagle.com/editorials_01/howe011901.html that their derivative positions are shrinking. The second condition that might have to be met is that the Bullion Banks have acquired enough future mine production to pay back the central banks.

Section 5 � The Unwinding of the Carry Trade

So, what happens when the price cap is released and the carry trade begins to unwind? The Bullion Banks will basically be acting as a conduit for sending the mine production back to the Central Banks. This would mean that the effective supply of gold from mining would drop substantially for a number of years. Even if the same number of dollars were purchasing gold under these conditions, it would cause the price of gold to rise several fold. However, investment dollars tend to chase whatever is going up in price. Hence, I suspect that the increase would be larger than the number that would be arrived at by assuming a constant number of dollars buying gold.

The central bankers would probably not mind this too much because they could blame the situation on the forward sales of the mining companies and effectively cover up their own incompetence at controlling inflation.

Section 6 � Questions for the Readers

Now, I have several questions for the readers.

1. Is anyone aware of facts that would disprove or support any of the speculation?
2. Does anyone know where to get grand total numbers for the hedging operations of the mining companies?
3. Do the Bullion Banks publish their derivative positions?

RossL (02/07/01; 20:03:13MT - usagold.com msg#: 47726)
JMB

That's an interesting story about the guy who took delivery of gold from the COMEX. Does this look like there is a pattern here: High volume on the COMEX, but it's just big banks trading warehouse reciepts. High volume on the LBMA but little evidence of any 400 ounce LGD bars moving around. Central banks holding high-profile gold sales but little evidence of any 400 ounce LGD bars moving around.
???

JMB (02/07/01; 19:51:08MT - usagold.com msg#: 47725)
RossL
"The big banks are trading warehouse receipts", ....darn.
You may be right; BUT, I read a series of posts about a kitco poster who decided to take delivery of a Gold contract. The process went on and on for two or three months until the fellow finally received his Gold. So, could be the Comex is in no hurry to deliver. I have not said this to be argumentative; hey RossL, you might be right on the money. I would like to keep an eye on the Comex Gold stash. Thanks for the info, it's great.

Journeyman (02/07/01; 19:24:44MT - usagold.com msg#: 47724)
CB PROFIT CENTERS @Randy, ALL

Hi Sir Randy!

Notice I used the term "profit center" because as many, particularly Peter Drucker (and I believe, Peter Asher) have pointed out, there is no "profit" for an organization until the last bookkeeping entry shows an excess. In other words, while you may make huge gains from bartering one thing for another ("selling" it if it's barter FOR money), until your whole operation shows a profit (more bartering power than you began with), usually accounted in "FRNS) here in U.S.A., you haven't made a "profit."

Please note that because of the "law" of comparative advantage (division of labor) BOTH sides of a transaction can and should show a "profit," that is, increase in trading power.

Vegas, pre Howard Hughes, often sold food and entertainment at a loss, to be underwritten by their profits from the casinos. That is, the casinos made more money than the whole hotel-casino operation made as an economic entity. The casino was a "profit center" but some of the excess money the casino division made went to underwrite the rest of the operation. Of course, it was the overall business equation that counted - - - free food and entertainment was one way the casinos ended up with so many willing customers.

SO - - - WITHIN an operation, you talk about "profit centers" and it's fairly safe to make calculations as to any excess they produce over costs - - - and call it "profit." However, when talking about the WHOLE OPERATION, only the "bottom line" counts. Because by definition the whole operation is more complex than it's sub-operations, it's more difficult to analyze a whole business than one of it's subdivisions - - - ASSUMING the internal accounting is set up appropriately.

As far as CB bottom line profits, I'm sure they have a nice black one. However it is ALSO safe to say that "buying" paper bills for four cents each and "selling" (distributing) them at face value is a tremendously profitable part of their business. That is, a tremendously valuable "profit center."

Regards,
Journeyman

JMB (02/07/01; 19:23:03MT - usagold.com msg#: 47723)
The Bubble Fix
http://www.msdw.com/GEFdata/digests/20010205-mon.html
I'll have the inflation please.

slingshot (02/07/01; 19:06:40MT - usagold.com msg#: 47722)
Randy@ The Tower Msg 47720
Profit
Profit is the vehicle which increases ones personal resources giving the preception of accumulated wealth.
Slingshot.

RossL (02/07/01; 18:49:40MT - usagold.com msg#: 47721)
COMEX stoppers and warehouse stocks analysis
http://207.96.251.155/scripts/news/search.pl?headline=warehouse

The above link will bring up a list of documents on COMEX warehouse stocks. Yesterday a link was posted by Randy that provides info on the stoppers, the COMEX paper that delivery of 100 oz. gold is exercised by the long.

In the 5 business days since first delivery notice day, 4858 contracts have been stopped for a total of 485800 ounces of gold. However, since January 30th, COMEX warehouse stocks have only dropped 97 ounces of gold from 1775330 oz. to 1775233 oz.

Guys, it's too early to proclaim GS as a savior. Apparently, the big banks are just trading warehouse receipts!!

Randy (@ The Tower) (02/07/01; 18:42:54MT - usagold.com msg#: 47720)
Journeyman, yes, precisely....but "profit"?
We've stabbed at this before on the forum. Perhaps you would like to lead off with your own attempt at expressing the meaning of the word.

I believe as people come to better terms with the meaning of "profit", their enhanced understanding will clarify the important role of gold in their financial lives.

Many people make a big mistake when they buy into the notion that "money makes money". How, by "profits"? What is that, interest or something else?

A bit of thought will convince them that money does not make money, but rather it is by time, energy, talent, ideas and effort that money may be made. And if we can say that all comerce (trade) occurs as participants swap items of perceived equivalent value, then wherein lies "profit"? What we see is each participant seeking to increase his personal advantage by trading his item for that offered by another...each gaining the desired advantage through this trade of "equivalent items". And yes, most times one side of this trade is only currency, but that fact itself does not equate to "profit".

For the moment, I will leave it to others to expand on this if they choose, and I may come back to it as time allows.

CoBra(too) (02/07/01; 18:42:41MT - usagold.com msg#: 47719)
"The Frankfurt Stock Exchange" - eg German Bourse ...
... outdid itself by listing in form of the first major IPO of the millenium on itself! The issue was 23 times oversubcribed - don't know about greenshoe - and traded itself on itself -shy of 10% - to a first recorded record price.
Nice? - and worthy of TIME magazine's, sublime front page contrarian indicator - vice. All told - go gold -cb2

slingshot (02/07/01; 18:18:23MT - usagold.com msg#: 47718)
The Plan.
CANUCK Msg.47714
Looks like the CB's would have us in a pickle if they have both above and below ground Gold. Paper would be out for sure. So, What's the plan? First do not get nervous. Learn a "DIRTY HANDS" skill. Get some street smarts. Learn how to barter. Use your Gold to purchase items of necessity. Wow! Flashback of Y2K.
How about since we have some gold, that we just exchange among ourselves and to HADES with the banks.

Slingshot

CoBra(too) (02/07/01; 18:18:15MT - usagold.com msg#: 47717)
Mr. McTeer and the "Buy the SUV" Syndrome!
...You gotta love the guy stating amidst a mounting energy crisis to buy a gas guzzling and probably third family car to help a slowing economy, dependent on consumers 'only!' along to renewed vigor.
Just assuming the said SUV sports license plates spelling Mitsubishi, Subaru, Daewoo or even BM'W' you'd be doing a lot for the economy, globally. Though, maybe, not as much for the currency as Mr. McTeer's first consideration should be.
So, maybe, he should have said - consume more of the high
tech fast food, crowding the alley of Silicon Valley - and dont gorge too much of the Beijing Duck ... stay close to home and cheer the NASDuck (-in merger talks with the EASDuck) "....". And as I can't spell the word to end this bland description of nonchalance, I'm asking, why can't we consume the taxpayers gold, assumed to be in the vaults of Ft. Knox, by chance?
Mac, we'll assure thee, we'll consume the stuff and turn the economee - around to a sound recipe'.
Telling you? cb2

Hi-Hat (02/07/01; 18:10:17MT - usagold.com msg#: 47716)
Trail Guide
Hello again. Could you please elaborate a little more on the dynamic that locks us into hyper-inflation.?

Inflation is inflation is inflation, but hyper-inflation
conjures up an image of string pushing that seems insane.

With markets and jobs potentially liquidating,defaults,
bankruptcy, etc. etc. I guess I just can't "see" what
mechanism causes the hyper.

The clowns in Washington have over our History pulled
many a rabbit out of the hat, to defraud and welsch
on a game gone bad.

People in soup lines are manageable and it seems like an elite oligarchy could believe they could control that
outcome. However it would seem that the going hyper
would unleash an all bets are off, dangerous unknown.

Journeyman (02/07/01; 17:55:11MT - usagold.com msg#: 47715)
Who's profit center is paper money vs. coins @Simply Me, Randy, ALL
http://www.ny.frb.org/pihome/fedpoint/fed01.html

Hi Simply Me!

You've pretty much gotten the underlying facts straight. As far as why the "golden dollar" is being pushed, well your speculations are as good as any.

The cost of manufacturing U.S. paper money - - - and, if you read carefully, who's profit center paper money is as opposed to who's profit center coin manufacturing is can be found in the above link to the Federal Reserve Bank of New York. First:

"The Federal Reserve orders new currency from the Bureau of Engraving and Printing, which produces the appropriate denominations and ships them to the Reserve Banks. Each note costs about four cents to produce."

Then:

"The distribution of coins differs from that of currency in some respects. First, when the Fed receives currency from the Treasury, it pays only for the cost of printing the notes. However, coins are a direct obligation of the Treasury, so the Reserve Banks pay the Treasury the face value of the coins."

High regards,
Journeyman

Canuck (02/07/01; 17:34:01MT - usagold.com msg#: 47714)
@ Sierra Madre
From your post:

"The Masters have decided to loot the Central Banks, to use the mega-banks for their purposes, and to consolidate control over gold mining all over the world, by bankrupting the mines."
-----------------------------------------------------------

I believe you have nailed the 'fishing' contest that Belgian, myself and a couple others have been floundering with.

So let's fast forward to the time (hopefully in the intermediate future) where the MASTERS have starved the miners to insolvency. A well-planned spike will secure confiscation of the mines, and low and behold we find out who has been ACCUMULATING over the years. So the masters have the gold above ground and the gold in the ground.

Where does that leave us, the little accumulators with a modest stash hidden away, nervous of the consequences?

With their 'plan' visible, what is our plan?

Canuck.

Trail Guide (02/07/01; 17:17:57MT - usagold.com msg#: 47713)
Britain must ease US fears on Euro army, says Cook
http://www.telegraph.co.uk:80/et?ac=000626415357098&rtmo=weQ0ljnb&atmo=99999999&pg=/et/01/2/7/weu07.html

By Toby Harnden in Washington

BRITAIN must allay US fears about the new European Rapid Reaction Force, Robin Cook said yesterday.

Speaking after meeting Gen Colin Powell, the US Secretary of State, in Washington, the Foreign Secretary said that the force could strengthen Nato. Gen Powell said he was encouraged by Mr Cook's promise that it would not be a rival. He said: "If we approach the European Strategic Defence Initiative in the way that Robin and I have discussed, then there's no reason to see this de-stabilising Nato in any way." Mr Cook reassured Gen Powell that Britain was fully committed to the Anglo-American relationship.--------------

-------------

Seems they have changed their feelings????
I will be back when able.

Thanks
TrailGuide

Trail Guide (02/07/01; 17:10:01MT - usagold.com msg#: 47712)
Interest rate cut in euro zone some way off - ECB
http://www.ireland.com/business/news/2001/0208/news3.htm

By Jane Suiter, Economics Editor

Interest rate cuts are still some way off, according to two of the most senior figures in the European Central Bank.

Strong data from Germany have bolstered ECB hopes that Europe can withstand the slowdown in the US.

Yesterday, the Bundesbank president, Mr Ernst Welteke, repeated his view that the time was not right yet for a cut in euro zone interest rates but the ECB was closely watching what kind of impact the US slowdown might have.

"We still feel it is not yet the time to reduce interest rates," Mr Welteke, a member of the ECB's governing council, told CNN International.

**********
German manufacturing orders jumped 2.7 per cent in December, far higher than the market had been predicting. French consumer confidence also hit a record high in January.
*********

The data also boosted the euro, which rose above $0.93, closing at $0.9333 from $0.9308 a day earlier.

********
The currency could move back to parity with the dollar in the coming months, said Mr Horst Siebert, one of the German government's panel of independent economic advisers, in a magazine interview this week.
**********

"It is feasible that the euro will move back towards dollar parity," he said in an interview to be published in today's edition of the German weekly
WirtschaftsWoche.

Trail Guide (02/07/01; 17:03:13MT - usagold.com msg#: 47711)
Nation Hopes to Return to Preeminence
http://www.iht.com/articles/9939.htm

A Despondent Japan Seeks Some Answers
Howard W. French New York Times Service
Wednesday, February 7, 2001

The fearful talk in Tokyo financial circles for more than a month has been the possible collapse of the banking system. Banks never recovered from the bursting of Japan's speculative bubble in 1990 and remain saddled with an untold, and undisclosed, sea of unrecoverable debts. If defaulting creditors set off a wave of failures, it would mark the second time in two years that the country has experienced a banking crisis. ----------------------------- Growing numbers of Japanese economists maintain that the postwar obsession with exports is a major part of the
problem. According to this view, the welfare of Japanese people has been sacrificed in the name of mobilizing capital toward exports instead of developing goods for local consumption.----------- As a result, the public has been stuck with tiny, expensive homes in overcrowded neighborhoods, high prices on consumer goods and few affordable options for day care or elderly care. Japan's
electronic brands are known worldwide, but many Japanese do not own a clothes dryer or dishwasher. Young women are increasingly revolting against the system by postponing marriage and children. -------------- "The Japanese focus has never been on making Japanese richer, their lives happier or more convenient and predictable," said Haruo Shimada, an economist at Keio University. "All of our energy has been focused on competing with the United States."

----------------------

Most Western people do not know the Japan that resides in the last several lines above. We have always been told that they are rich with savings. I know this land of the Yen and their image was never as good as we were told.

TrailGuide

Trail Guide (02/07/01; 16:46:12MT - usagold.com msg#: 47710)
A New Tack From U.S.
http://www.iht.com/articles/9910.htm
A New Tack From U.S.
David E. Sanger New York Times Service
Wednesday, February 7, 2001

Treasury Secretary Rejects Lecturing Tokyo

WASHINGTON President George W. Bush's Treasury secretary plans a new U.S. approach for dealing with Japan, as the world's largest and second-largest economies appear headed into decline. -------------------------------- The combined effect of slumps in both countries, which together make up about 40 percent of the global economy, is being felt worldwide. Yet politicians and bureaucrats in Japan appear to be invoking the same prescriptions - hundreds of billions of dollars of more deficit spending by the government - that have repeatedly failed to get the country growing again. ------------------- He said, for example, that he was not interested in lengthy, vague discussion of Japan's myriad regulations. Instead, he said, he wanted to introduce "price competition" to Japan, noting that it was exactly that kind of competition from abroad that rebuilt U.S. industry in the late 1980s and early 1990s. ----------- But the same Japanese executives with whom Mr. O'Neill says he wants to deal directly have spent years fighting against low-priced competition, both foreign and domestic. --------------

------------------------

With no where to turn, no new initiatives to tap and arriving at a timeline change in international currency values; both these countries are about to take a path of no return. As this downturn begins to bite, our collective governments will be forced to buy up every asset necessary. All just to keep the fires burning! This is the classic threshold of an intense inflation.

It makes me recall a line from Red October, the movie,,,,,, where the Russian submarine captain (played by our retired 007) disposes of his KGB counterpart just before stealing the ship! He says:

---- "to where I am going, you cannot follow"-------

Indeed, where the dollar universe is now heading, no nation should follow! Can you spell hyperinflation? In Japanese?

TrailGuide

Sierra Madre (02/07/01; 16:28:17MT - usagold.com msg#: 47709)
Belgian...a simple solution to a complex problem
Why is gold behaving so peculiarly?

I had a post ready on this subject earlier today, but erased it. Here goes, again:

The simplest solution to all the peculiarities that gold is exhibiting on the worldwide scene, is staring us in the face. We just have to recognize it:

The powers that be know perfectly well that this period we have been living through, of paper money, has to come to an end in the not distant future.

The powers that be, dictate to Central Banks. We tend to believe that these institutions are sovereign and represent institutions at the service of their respective nations. This is simply false. Central Banks have supranational masters.

The Masters have decided to loot the Central Banks, to use the mega-banks for their purposes, and to consolidate control over gold mining all over the world, by bankrupting the mines.

Gold is more important than ever, and the Masters know it.

The low price, in constant decline, is meant to scare off investors so that they, the Masters, can accumulate as much as possible during this period, before the whole paper system collapses in world wide inflation.

In the meantime, the Masters are accumulating enormous quantities of gold. They will land on their feet, after the huge crisis, as they have always done. Goldman Sachs, Chase, J.P. Morgan, Deutsche Bank, Citibank will be allowed to go broke, and then handed over to governments (read taxpayers) to bail them out. The liabilities in gold derivatives mean nothing to the Masters. The gold means everything!

In the new era which has not yet dawned, the Masters will be great holders of gold, accumulated in secret at extremely low prices.

This is what a corporation with crooked owners does with its prime assets when it sees the jig is just about up: the enduring, valuable assets are sold off cheap to the Insiders. Let the dumb stockholders hold the bag.

Who are the Masters? Perhaps we shall find out, someday, if we live long enough. What we are witnessing are actions that are incomprehensible unless this final objective is taken into account: paper is on the way out, gold is to be the basis of power, as always, for the Masters of Finance.

Accumulate as much as possible. Forget the price!

Mr Gresham (02/07/01; 16:09:18MT - usagold.com msg#: 47708)
Belgian (02/07/01; 14:31:31MT - usagold.com msg#: 47703)
There you go again; more questions than Columbo (Peter Falk)!

Very good -- I wish there was a way of organizing what you've written in your last two posts, for it seems like you do the best job of including all of the issues in our "mystery" up to the point where we do not know the next fact.

My summary guess for all of it would be: public gold passing into private hands. At low prices (public excluded) for as long as possible, then during the ramp-up some last-minute sprees with letters of credit and corporate paper issue?

Perhaps the CBs and mining corps are to be jettisoned in a banking crisis? Or side-stepped in favor of some new free-wheeling private international bank. The illusion of powerful governments and the publicly-visible CBs (with their bureaucratic staffs) will be considered expendable after a banking meltdown? The "rescuers" will be ready...

Ah, if only M could just send 007 on a small information-gathering mission... ("Do you expect me to talk?" "No, Mr Bond. I expect you to die!")

Randy (@ The Tower) (02/07/01; 15:40:32MT - usagold.com msg#: 47707)
e
There it is...it fell off, seemingly.

Randy (@ The Tower) (02/07/01; 15:38:48MT - usagold.com msg#: 47706)
Gold, both on-lin and off-line
http://www.usagold.com/onlinestore/special.html
A quick reminder that our featured "coin of the month" made specially available for on-line ordering happens to be two coins....the Swiss Confederatio 20 franc coin and the Danish "Mermaid" coin (in both 10 and 20 kroner sizes).

Now get this, in talking with MK at Centennial, he said they had secured some small caches of Argentinos and even some Uruguyan 5 pesos coins in addition to the usual slate of products. Call up the office and rattle his cage. Ask them what others they have on hand and tell them how many of these beauties you want at these excellent derivative-driven prices.

How nice it is to hold a world-class asset in the palm of your hands as tangible representation of your own productivity. This is the kind of thing that only YOU can do for you. Make the call....

Pandagold (02/07/01; 15:29:48MT - usagold.com msg#: 47705)
They'll wiggle out somehow

Why do I get a feeling a deal has been done to take the heat of the Cabal by putting the emphasis on 'hedging' has being the main culprit?

It seems to be working

( article on Kitco News)
S African hedging moves rattle gold stocks
Feb 8
AAP

Australian gold stocks slumped on Wednesday after two South African mining houses revealed plans to increase their hedging of forward production.

The world's biggest gold miner, AngloGold, said at a conference in Capetown on Tuesday it intended to hedge 50 per cent of its production for the next five years over a 10-year period.

"Currently they are 50 per cent hedged for four years," Bell Securities gold analyst Mr Keith Goode said. "That therefore implies they are going to put in another 3.5 million ounces on their hedge book."

In addition, Harmony Gold Mining Co, which had said it would never hedge, revealed plans to forward sell 1 million ounces of production following its acquisition of Elandsrand and Deelkraal from AngloGold.

The announcements led to a slump in the gold price overnight and impacted negatively on North American and Australian gold stocks, Mr Goode said.

"The AngloGold and Harmony announcements stating that basically there was a net 4.5 million additional ounces hedged between them was enough for the gold price to fall.

"The general thought is that the South Africans are starting to get stuck into hedging... and the perception is the gold price is not going to run."

Also pressuring gold prices are concerns that the earthquake in India will affect the country's demand for gold.

Gold fell $US2.15 to $US263.40 an ounce on Wednesday with the Gold Index on the Australian stockmarket down 12.5 points at 707.

Among Australian gold producers, Delta Gold closed steady at $1.32, Goldfields was down 10� to $1.70, Normandy was 3� weaker at 95� and Newcrest fell 7� to $3.97.

Pandagold (02/07/01; 14:50:47MT - usagold.com msg#: 47704)
A turbulent year ahead?

Where's my gold snake boots?

It would now appear that the Brit elections will be in May. How will this figure in the POG?

First, IMHO I believe (100%) BoE was working with the cabal in the manipulation of gold. This, to me, and many others, was made obvious by the way it was done � in particular announcing the decision well before the event, and in the manner (timing) in which the different auctions have been staged.

Obviously it would look very bad for Blair, if the gold price was to rise much above the average selling price of the different auctions before the election, I would feel the BofE have had assurances it would not. The opposition would have a field day on this alone.

Also, today in parliament, Blair has indicated a date for moving the country to drop the pound for the euro - within two years (though this would need a referendum). To help this along, and to sell it to the Brits, there would be a need to see the pound dropping and the euro gaining in strength, which is moving slightly that way now.

There are indications it could be towards the end of this year (I think beginning of next)

So, here are two things capping POG to around its present price for (give and take a few dollars up and down), at least, until towards autumn (fall). It is around this time that things also can go haywire, generally, in the financial markets - September/October.

There is another scenario brewing, one in which I hope my 'ether' vibes are proved wrong.

I have a gut feeling that Sharon will put forward a 'peace' deal to the Palestinians, one which will be hyped as Israel giving great concessions in exchange for peace. On the surface, especially to those who do not fully understand the problem (or even care), it will appear, by the way it is presented, that Israel is being more than generous.

To the Arab, it will be a double shuffle, or a deal from the bottom, whatever, and they will reject it, for they know that Israel will not meet the Palestinian, and majority Arab
demands on Jerusalem. They will, therefore reject it. The street fighting will go on, backed by a few terrorist attacks (maybe one terrorist attack staged by the Mossad).

It will be enough for Sharon to have the excuse to put down the Palestinians by force, escalating tension in the whole region, and put some Arab leadership in danger of being overthrown if they do not react against Israel.

You can guess what the outcome will be. At some stage, US involvement. This will work nicely to shift people's attention away from the economic situation at home which will be beginning to bite deeply by then.

There is much more, but I feel that is enough, for now. I hope it will NOT materialise, but, the odds, I feel, are more than 50 to 1. I will have my supply of the precious metal, in one form or another, as inflation will rear its ugly head (above the parapet) to the point where it wll be noticed. This, together with the ME problem will turn people to their old standby.

This will be a turbulent year in more ways than one. Well, what do you expect, it is the true millennium year. Snakes can be viscious, sneaky unpredictable creatures, and can strike suddenly and quickly - now where are my gold snake boots.

Belgian (02/07/01; 14:31:31MT - usagold.com msg#: 47703)
Central Banks and Gold :
Interesting, how little is known (publicised) about the actual purpose of Gold, for CBs. What is the meaning of that childfist with 8.000 tons of Gold for an immense flood of world US$s ? If the dollar-masters would attach any significant importance at Gold...they would have been accumulating much more of it instead of decreasing the initial ('71) amount, as is done with other strategic tangables (Ag etc..). In the not so distant past, Gold-reserves served as a public confidence of last resort, for masking the idiocy of relentless credit creation and artificial expansion. The absolute silence about gold is making its confidence role obsolete for the broad public.
Governments are sucked into the currency arena and have become speculators. The gold producers must know this and are scared to death that their goldmarket could implode.
They are forced to ignore some kind of Gold-Drama in order to save their skin. The WA came to their rescue. POG was diving at increasing speed. CB's invented the win-win hocus pocus. And the big gold-investors believed for a second that the CBs had changed their mind, not to sell it all, at once. Anglogold understood the message and adapted swiftly.

France, Italy and Germany, want us to believe they still rely on their goldreserve. But, why wasn't this argumented in extenso (price-supportive)? Is the global gold-world, too small and elitarian, that it doesn't deserve public attention anymore ? Is China the biggest secret buyer ? Is it a coincidence that Harmony ships its gold directly to China ?
Is it a coincidence that Japanse, for the first time ever, intends to acquire a hefty 21% stake in Harmony ? No it isn't. South Africa was and still is very active in those regions. We can only speculate on China's reasons to focus its attention(opening) on gold so "suddenly". Is there a strategic purpose or is it just plain vanilla jewelry business ?

What could be the main reason for CB's to sell gold ?
- they just want to get dollarized and use the handfull of gold-reserves, to help make it happen ?
- they had too much of it and haven't any clue as what to do with it ? (Belgium-Netherlands-Switzerland-UK)
- they prefer to play the modern game of currency-waving between US$-Euro-Yen ? Mouse-Click - it, money !

Is 32.000 tons of gold a sufficient amount of volume to activate (move-influence) a currency bloc ?
Are there any considerations on this 32.000 tons gold at all ? Is there an artificial silence, for not rocking POG to violently ? Not a single academic study on the topic of CB's and gold ! Unbelievable ! Economy students...wheeeeeere are you ?

Isn't it very, very, strange that the Buffet's and Gate's or Sorosses, have all choosen silver ???????? True or false ? Why is Anglogold trying to convince us that we are wrong with our conspiracy/manipulation theories ?
Is it a polite way to say : it's the CBs overhang stupido's ? Shut up and don't scare the gold-accumulators with your pot-stirring !?

Anglogold, only focusses on jewelry and not investment for its marketing initiatives. Do they consider gold "out" as "investment" ? Is jewelry the China approach ? India / ME, replacer ?

Are we confusing the POG-Manipulation with an orderly jewelrysation of CB gold ? Is each central bank on its own...or are there agreements between gold holders and goldsellers (other than WA)? What is the logic of selling so called excesses of goldreserves and keeping a much smaller amount in the vaults ?
But, if CBs, have the intention to sell more gold...why didn't they manage a POG increase, together with their producer allies ? Increase the lease-rate and whoops... off it goes. But does Anglogold want to share the goldmarket with other small pirates ? HaHaaaaaaaa.

I force myself to keep an open mind towards this 5 year POG-anomaly. It is not circumstantial ! Anglogold (Anglo American), not the South African government, must be an important "actor" and not a simple spectator, in the POG mystery.
Because Barrick is to be introduced in SA, rather than Franco Nevada ! Guess who is still in charge in SA. ? And always has been. Fundamental differences between Afrikaner(GOLD) and Anglo-Saxons(AU)! Still alive and kicking.
BTW, GOLD got a 7$ value as take over. IMO, there will be no take over but a merge (shareswap). 210 + 120 tons yearly
empowerment. (swing-producer)

Fact remains that the 30.000/32.000 tons of CB-gold hasn't officially increased. Does the WGC-facade knows, where the remaining gold is stored (if any)? How come, that the Fort Knox enigma is still unresolved ? I do feel so ridiculous, not being able to answer that simple question as a gold-phile. Not the only unanswered question of course.
If goldproducers would engage in media-initiatives to lift the price of their commodity...they would find plenty of confidence building stories to do so. Time out for playing secrecy games and artificial smoke screen acts . Another 50.000 tons of underground gold is at stake (golden arches). The reason why they just keep trying to adjust(hedging-consolidations-etc) on the lowering POG, must be an argument that something more fundamental is happening. I refuse to believe that world-gold-producers are infantiles. And Anglogold in particular.
They are not the prototype of Don Quichote. (cfr. De Beers cartel surviving for years)

What is the most pragmatic attitude towards this ongoing gold-enigma : accusing the supposed manipulators or trying to understand what and why this anomaly is happening ?
Answer : both + steady accumulation of physical gold, of course.
Disclaimer:I own gold and intend to accumulate progressively and steadyly.

POG doesn't react or anticipates nothing for the time being.
On the contrary...its behaviour is contradictionnal.
Has nothing to do with offer/demand balance or imbalance.
Gold-movers (pricemomentum-initiators) are extremely well informed and don't suffer from gold-paralysis. They do not "organise" an occasionnal (spontanious) POG ride anymore. They need a WA-alike, to take action again.
This behaviour is closer to an acceptance of some sort of huge gold overhang instead of "pure" manipulation for, God knows, what reason. Because I refuse to believe that big bad pirate-squeezers died out, completely .

Governments are continiously manipulating-managing their currency in function of their economic position towards their references. Have we any evidence that they are using gold for this purpose as well ? I don't . I have a strong perception they are treating gold as inherited family jewels, wich they sell or lease without any kind of emotion.Remember the Suisse referendum !
They just don't wan't to inform their citizens about this indifference, for reasons of possible price-imponderabile.
This unspoken attitude is probably an explanation for laclustre POG behaviour. We need an earthquake to revitalise the utmost importance of the forgotten gold.
This shock is surely in full preparation. In one single word :DEBT ! TA of POG over 30 yrs, suggests, we are pretty close. The complete amount of 32.000 tons is not going to be sold in one go. Maybe, already 10.000 tons of it are already gone ? France/Germany/Italy and the left overs of other nations might desire a higher price. Anglogold, perhaps will signal when they are ready to let the price spike ? Win-win, remember ! Oligopoly, you know ...or who knows really ? Fascinating, isn't it. Be part on this greatest show on earth.

Sierra Madre (02/07/01; 14:21:42MT - usagold.com msg#: 47702)
Sacagawea Dollar....
The reason behind the Sacagawea Dollar is that the money supply is reaching such stratospheric heights that it is becoming a real burden to print ever greater numbers of dollar bills. The bills only last about 3/4 months (?), maybe less, before they must be replaced.

The Sacagawea Dollar is here to stay, like it or not. In a couple of years, at most, you won't find dollar bills any more. They won't be printed anymore. You'll have to take the coins, there won't be anything else.

Later, the same thing will happen with five and ten dollar bills. You'll have coins.

The shape of the coins will vary; the dollar coin will eventually become about the size of a dime.

Such is inflation of the money supply. It's quite customary in the "third world". You'll just have to get used to it.

JMB (02/07/01; 14:05:25MT - usagold.com msg#: 47701)
Gandalf the White
"I see, I see.", said the blind man. If it was a snake, it would have bit me. Thanks

Say, that's a very interesting name you have. Maybe a small explanation for your fans.

Randy (@ The Tower) (02/07/01; 14:01:08MT - usagold.com msg#: 47700)
Simply me...interesting comments about the Treasury and profits
Could you attempt to elaborate a bit on what your thoughts are regarding the meaning of the word "profit" when it comes to the Treasury? Loosely put, I always saw it simply faced with the task to balance (or just keep) the books of the federal government -- both "non profit" institutions. (And that is not to suggest that there are not "benefits" to be redistributed to those in their employ, but the source and nature of those benefits is yet another matter for discussion.)

Tree in the Forest (02/07/01; 13:54:35MT - usagold.com msg#: 47699)
JMB, Gandalf
Interesting that Comex gold and Futuresource numbers don't jibe. I'll check this out again tomorrow.

Randy (@ The Tower) (02/07/01; 13:48:01MT - usagold.com msg#: 47698)
Fed's open market operations today added $5.490 billion to banking reserves
Driven by need to grease the wheels...the fed funds market was near target, and the these were not overnight repos--they were 15-day agreements.

Don't you just love the slosh of currency as it flows past your ankles?

Simply Me (02/07/01; 13:25:45MT - usagold.com msg#: 47697)
@SLATT RE:The Brassy Lassy
Now THIS I know about. Sacagawea Dollar is total bust in commerce. When they first came out collectors (mostly new collectors who started a State Quarter collection) bought up rolls and BU Sacs and put them away (how many? who knows.) The Proof Sac. Dollar was very popular, too, when it first appeared. The collecting craze is done now, however. Now, if you try to give someone a Sac. Dollar in change, they look at you like you're trying to hand them a spider!

There was some discussion on this forum about the motives and purpose of introducing the Sac. Dollar. One of the best arguments IMO, was that the U.S. Treasury gets the profit from coinage, whereas only the Fed profits from printing the paper money. I do hope I'm relating that point right....maybe someone who knows that subject better can elaborate or correct the statement, as need be.

Just a thought, though....Does the Fed increase it's profits in any significant way by putting more currencey into circulation?

simply

IronHead (02/07/01; 13:21:15MT - usagold.com msg#: 47696)
beesting - NOT So Bizzare Thought RE:your #47694
Sir Beesting - You've hit the nail on the head, and my answer to Sir Journeyman's question of "why Central Banks should not sell gold", takes the oppsosite tact, that indeed they should sell gold, and all of it, such that we as sovereign individuals can empower ouselves to trade and commerce freely amongst ourselves, and be "free" of their manipulations and usury.

But sell it they won't, with their holding and apparent accumulation, along with the Saudi's, Asian's, etc. etc. etc., should be an EMP (electro magnetic pulse) in our fuzzy little cortex's, TO GET SOME, MORE!!

Stocks, Lies, and Ticker Tape (02/07/01; 13:12:52MT - usagold.com msg#: 47695)
IronHead, ....."Gold Tone" coin conditioning?
Are you referring to increasing the citizens acceptance over time to real gold in coinage? If so, then that would make me a happy convert for the Sacagewea(sp?) dollar....but only if it is at least gold plated!

I think the issuance of a gold tone dollar was more of a cheap ploy to try to generate greater usage of the coin than the Anthony dollar.

Someone posted recently about adding gold threads into the dollar bills, I'd be grateful for any ploy to get gold in our currency so it will truly hold its value, and hopefully change public perception as a result.

beesting (02/07/01; 13:00:59MT - usagold.com msg#: 47694)
Here is Another Bizarre Thought!
Why doesn't the U.S. pay off the National Debt or sell their Gold publicly?

Answer; The U.S. Federal reserve holds the 6.5 trillion and Gold as a show of "Collateral" to possibly..."""Avoid a Hostile Take over.""" How many of the Worlds Bankers would just love to collect the Wealth of The United States of America?????...beesting.

Stocks, Lies, and Ticker Tape (02/07/01; 12:55:56MT - usagold.com msg#: 47693)
Pandagold, American savings?

You can be assured that Uncle Sam is not trying to increase the rate of savings of the average citizen. Our culture has become one of spending at any cost. Thrift is a long forgotten practice. If you do not have the funds on hand there is a never ending line of easy credit for the taking. With the rate of taxation ever increasing Uncle Sam even taxes our interest income from a savings account!

The ignorance of our people regarding the monetary system is sadly nearly universal. The outright attack on gold from many fronts over the last 30 years has been extremely successful. I would be willing to bet if US citizens at random were given the opportunity to take for free $264 in US currency or one ounce of gold.....nine out of ten would take the $$. It is very sad.

IronHead (02/07/01; 12:47:28MT - usagold.com msg#: 47692)
Stocks, Lies, and Ticker Tape - The Grande Illusion - RE:your #47684
Sir SL&TT - Nothing comes by chance or cosmic big-bang, especially when it involves the logistics of developing the phsychology of the masses to accept a concept.

Don't you find it serendipitously fascinating that [we] are being led to this new *gold* coin? For what reason??

I think Sir Journeyman would call this "playing into our hand" - and hopefully he will correct my usage, as "not" a poker player I be.

Gold - hard to fake. [but watch for those plated Pandas]

Salutations
IronHead

Gandalf the White (02/07/01; 12:41:52MT - usagold.com msg#: 47691)
More on JMB's Question !
http://www.futuresource.com/cgi-bin/quickquote?+=gc%2C2
JMB (2/7/2001; 8:19:29MT - usagold.com msg#: 47676)
Goldman Sachs
Our new found friends were hit with 8 of the 39 Gold contracts issued today on the Comex.
All: How many Feb Gold contracts are still open on the Comex. TIA
----
Check out the LINK !
Looks as if 150 contracts still existed on the FEB contract as of yesterday.
---
<;-)

RossL (02/07/01; 12:37:43MT - usagold.com msg#: 47690)
JMB, Tree I.T.F.

I am interested in an analysis of where the Feb. COMEX gold is going... I'm wondering how it is affecting the registered and eligible amounts at the warehouses, and if gold is entering or leaving the warehouses over the last few weeks. Does anyone have a source for these numbers for the last month or so?

beesting (02/07/01; 12:37:21MT - usagold.com msg#: 47689)
Why shouldn't CB's sell their Gold?
Hope This is not too Lengthy.
There are 2 ways to look at this question. One way is from a CB's perspective, the other way is from a striving to be Sovereign individuals perspective.Hopefully the one long answer will cover both.
I base my conclusions from the video "The Money Masters" a very educational film about the history of banking.

Short answer from Thomas Jefferson,"He who controls the money supply controls the people!"

The cartel of worldwide Central Banks has achieved almost total control of the worlds money. How did they do this?
By first gathering as much of the real money(Gold)into their vaults.How did they do that? Don't know about the rest of the world, but in the U.S. (a long time Gold producing nation) in 1933 President Roosevelt by "emergency executive order" made it illegal for the people to trade in Gold, and at the same time traded Federal Reserve issued notes(backed only by taxpayer collateral...future goods and services) to the banks nationwide in exchange for the Gold on hand.
((beesting comment, paper for Gold, What a Scam!))

Before this action and after the 1929 stock market crash the Federal Reserve(C.B.)took 3/4 of the "money" out of circulation.Where did the money go?((The video says much of it went overseas as the "Big Players" sold U.S. produced goods, for GOLD) How did they do this, and why did they do this?
The Why First:
It was a set up! If the Gold wasn't taken out of circulation people would have used what we call "The Barter System" among themselves and used Gold and silver in return for goods and services(without depending on Gvt. or Federal Reserve money at all), that's what the founding fathers specified in the U.S. Constitution!(A sovereign Nation of Sovereign Indivduals using Gold and Silver as a medium of exchange.)
Small stock investors lost their "Shirts"(including my Grandfather) while the "Big"(read super wealthy,good old boys)players, who were warned ahead of time about the crash siezed control of the industries and most large production facilities in the U.S., this went on up to and after WWII, when Americans spurred on by the war effort started out producing the rest of the war torn world.

"Why shouldn't the CB's sell thier Gold?

Because thats how "The Big Players" settle their accounts when they trade at the international level! The privately owned "CB's" are owned by "The Big Players!"

For those that don't know, the BIS(controller of all the CB's) values the U.S. dollar in Gold. 1 Gold Franc =$208. U.S. dollars.

Is the situation hopeless? (((NOT AT ALL!!!)))

Once the people figure out how to get "The Money Supply"((READ GOLD)) back as a medium of exchange among themselves they will have a chance to regain their Soveriegnty....IMHO!(Read Sir Aristotles 5 part discussion on using Gold as money at the top of the page, and lets discuss it some more!) And, I believe one way has already been started, on Feb.6,2001 which USAGOLD knows about, and hopefully will implement in the near future....I know I'm interested.....Thanks for Reading...Those in the Know are Buying Gold....Please remember I'm only a messenger, not the creator of known facts....beesting.

Stocks, Lies, and Ticker Tape (02/07/01; 12:31:17MT - usagold.com msg#: 47688)
OverHerd, I am sorry if my post was not clear to you
I was not attacking Pandagold! I am certain he took no offense to my registering my opinion since he posted it on an open forum. My post was in response to the content of the article. If that was not clear to you then I apologize for the misunderstanding.

The article was in effect a press release for the US mint to try to move a whole lot of unwanted "gold tone" coins. If you live in the US, I would like to know if your experience with the new dollar coin has been different? It is a complete bust in commerce everywhere I have traveled.

JMB (02/07/01; 12:04:55MT - usagold.com msg#: 47687)
Tree In The Forest
Those "nice" things I say about Goldman Sachs are said with tongue in cheek, I hope the bastards go broke!:)

Thanks for the O.I. info re the 422 Feb Gold contracts still open. If GS runs true to form they should stop about 100 to 150 of those 422....IF they do that, I have to assume that they have turned bullish on Gold. (Keep in mind that I have no idea what I'm doing, I'm just guessing).

The Dow and Duck are slipping, the Buck is vulnerable, Gold is trying to catch a bid, Murphy is in South Africa raising hell, a kid took a shot at the White House (maybe), they could turn off my lights any moment (If anyone thinks that business is going to expand in California they had better quit smoking pot because their judgement is impaired), as Randy has pointed out the Fed is pumping out "funny money" at an astounding rate, and now the evil Goldman Sachs Corp. is taking delivery of Gold. I think we're on the right track.

Say Tree, if you could keep the Feb. O.I. figure coming until it goes to zero, I'd sure appreciate it. Many thanks.

IronHead (02/07/01; 11:56:17MT - usagold.com msg#: 47686)
Topaz - Ozzy Eco Sentiment? RE:your #47662
Goodday Sir Topaz - It would be of interest to know the general Aussie's sentiment towards the ecological effect of gold mining. With an ever increasing closure of mines, both silver and gold, the availability of said materials are certainly not going to be "growing" to meet continuing demand. As Sir Pandagold mentioned in his #47661 post regarding Normandy mines, four additional Aussie mines have been recently been closed, that depending upon public sentiment might not be re-opened?

The question of ecological impact and the psychology of the general populace has been extremely germane to the mining industry in my direct neck of the woods, with the proposed Chesaw mine in North Central Washington a good example of the environmental lobby against mining and the subsequent impact to Battle Mountain. The silver mines shut down in nearby Idaho also will have a possible uphill battle from the environmental front before coming back on line.

I am not in the mining industry, but think it safe to say that a mine is not simply re-opened or re-funded at a moments notice. With what I see as a concerted effort to monopolize the mining industry by certain Hannibals, first driving out the smaller less capable mines, then forcing into servitude other larger more profitable mines through the strong arm of "helpful" hedging, we arrive at the perfect one stop shop - "the company store".

With the media in one pocket and the environmental camp in the other, who's to say this is not a really grande scheme?

Would greatly appreciate any thougts you might have in this regard.

Salutations
IronHead

OverHerd (02/07/01; 11:36:35MT - usagold.com msg#: 47685)
SLaTT
Why is it always attack, attack, attack. Is it possible to disagree politely?
As I read the post it was the WSJ that called the coins golden.
Back to lurking
Joe

Stocks, Lies, and Ticker Tape (02/07/01; 11:06:13MT - usagold.com msg#: 47684)
Pandagold, "Collector hoarding" of new "gold" dollar
What a miserable bunch of BS! The truth about that coin was not told. First off it is a "gold tone" coin. It is also too close to the size of the quarter, something the mint still didn't get right after the Susan B. Anthony fiasco. Using a dollar coin for cash registers and the older vending machines hasn't sold the business community on this coin either. The lessons not learned by the mint still continue with the forcing down our throats of yet another coin steeped in political correctness. The Anthony dollar was an attempt at mollifying the pro Equal Rights Amendment crowd in the late '70s. The current Sacagewea(sp?) dollar is another overt attempt at political correctness.

The coin is not popular with coin collectors. IMHO it is a ugly coin and the concept of a gold tone coin is insulting if not infuriating! Anyone can get as many as they want from any bank, just request it, since the banks will not order them as they are not at all in demand for circulation. The lie of the collector hoarding of this coin is too transparent.

This type of pandering is best left to the USPS! If our coinage is further sullied in the future by the issuance of a Bill & Hill, I'll be one of the first in line to get that coin in its rightful place.....on the tracks of the next approaching locomotive!

Tree in the Forest (02/07/01; 11:05:54MT - usagold.com msg#: 47683)
JMB
Hi JMB. Comex gold:

Open interest (# of 100 oz. contracts)
Feb 422
Apr 90,734
June 17,296

Warehouse stocks (in oz.)
Eligible 91,475
Registered 1,683,855
Total 1,775,330

So about 10.8 million oz. saught, only 1.8 million oz. available. What does this say about what might happen at the end of April? What we need now is stoppers. Sorry...I can't get myself to cheer for Goldman Sachs!

Pandagold (02/07/01; 10:31:42MT - usagold.com msg#: 47682)
Collectables

Is this a novel way Uncle Sam has come up with to get the Americans to save - they could produce another new coin every so often - two dollar, five dollar - how about a three dollar, now that really would be collectable?

Coin operation: Mint sees gold in Safeway Inc.
The Wall Street Journal - US Abstracts, Feb 7, 2001

The U.S. Mint is working frantically to increase the circulation of the 700m $1 coins it minted last year, almost 600m of which are being hoarded by collectors. To combat low circulation, the Mint has commissioned supermarket chain Safeway Inc. to distribute 1.6m of the gold coins to its customers as change. Although the number of coins to be released through the 1,500-store network seems comparatively slight, the Mint is betting that customers have hoarded all the coins they want ensuring that circulation will increase dramatically once the currency is made visible at one of the nation's largest food and drug retailers.

Abstracted from: The Wall St Journal

SHIFTY (02/07/01; 10:19:05MT - usagold.com msg#: 47681)
Shots fired at White House
Shots fired at White House
Suspect Dead
Prez A - OK

SHIFTY (02/07/01; 10:11:33MT - usagold.com msg#: 47680)
Journeyman
Question of The Day
credibility / credit ability

?????

$hifty

Stocks, Lies, and Ticker Tape (02/07/01; 09:43:01MT - usagold.com msg#: 47679)
Journeyman, Why CBs should not sell gold
I'll take a stab at it. Is it because the CBs have created far more paper gold than exists physical? When the house of cards falls, the physical gold in hand will skyrocket in terms of fiat currency?

Or is it the "gold is power" argument Pandagold is so fond of?

JMB (2/7/2001; 8:35:44MT - usagold.com msg#: 47678)
Old Yeller
California here Old Yeller...we can hear ya 5x5 (or is it 4x4) loud 'n clear. The lights are still on and the coffee is almost ready and the tv is loo........

Old Yeller (2/7/2001; 8:26:44MT - usagold.com msg#: 47677)
California:do you read me,come in California

Looks like Paul O'Neill may be our type of guy after all.

Quote from Feb.8 interview;

"I really don't understand why someone would take billions of dollars and give it to people who willfully created their own economic mess."

This refers to the Russian "problem" so deftly handled by Clinton's boys and the IMF;but tell me,is there really all that much difference?

JMB (2/7/2001; 8:19:29MT - usagold.com msg#: 47676)
Goldman Sachs

Our new found friends were hit with 8 of the 39 Gold contracts issued today on the Comex.

All: How many Feb Gold contracts are still open on the Comex. TIA

Journeyman (2/7/2001; 7:53:27MT - usagold.com msg#: 47675)
Question of The Day @ALL:
Why shouldn't CBs sell their gold?

For any who care to indulge:

From their own perspective, what is perhaps the main though often forgotten reason central bankers shouldn't sell their gold?

If I remember correctly, one or two posters here have already answered this question - - - and I suspect many more know.

Clearly the answer I'm looking for isn't, "Because it will lower the price of gold."

Regards,
journeyman

Journeyman (2/7/2001; 7:39:30MT - usagold.com msg#: 47674)
One more entry @Randy, ALL

My wife found out about the "derogatory nick-name for gold" contest and came up with one herself.

She asked me if I'd enter it for her.

So here it is: pulp fiction

Regards,
journeyman

P.S. I have a file with all the entries. I don't quite know whtat to do with it. We could all vote, but the votes might clutter up the table round. Perhaps Randy might have some suggestions. I don't want to judge myself - - - there are so many good ones - - -

Journeyman (2/7/2001; 7:20:50MT - usagold.com msg#: 47673)
CNBC talks gold @ALL

Michelle Caruso Cabrara did spot on gold. Nailed the African miners hedging news, and less rigorous, the "India to buy less gold" angle. ~8:58AM

They've been covering gold sporadically lately. Today it seems to me, they went into a little more detail. And of course both stories were negative for POG.

Regards,
j.

Knallgold (2/7/2001; 6:49:49MT - usagold.com msg#: 47672)
Proof of a theory
Selling paper (Anglo's forwards),buying physical (in the ground,from Goldfields).Sounds familiar,eh???

Stocks, Lies, and Ticker Tape (2/7/2001; 6:39:35MT - usagold.com msg#: 47671)
ALL.........Scrap GOLD from?????
Someone posted a week or so back about the gold content in old junk computers. However the specifics were lacking (i.e. which components contained the gold). I hope you are still out there and can elaborate!

Is there a source that anyone can suggest for learning the industrial applications of gold, from the scrap gold standpoint? With it being so "cheap", now would be the time to round it up.

Imagine.....a SLATT faced double eagle.....guaranteed to go for a hefty premium over POG! USAGOLD, you will have first crack at them!

Stocks, Lies, and Ticker Tape (2/7/2001; 6:17:51MT - usagold.com msg#: 47670)
slingshot, post #47632, Putting Old Pennies to Work
This post being a purely hypothetical endeavor on my part:

Your post is reminescent of the $40/ounce silver days. A while back I did the same math (perhaps not correctly?) on the copper content of the pre 1982 pennies. At that time scrap copper/brass was being "purchased" at 73 cents per pound. My calculations yeilded that the breakeven point for the copper content of such pennies would be at $1.50 to 1.60 per pound. Also, even that penny can earn interest! (I am embarrassed to even admit that!)

All pennies can be useful (in a pinch) in the melt when casting brass. The post 1981 pennies could be used to supply zinc to a brass melt in a pinch.

Scrap copper in quantity can be had these days if you watch for it, in ways that will save your back! I too have a difficult time walking by even a penny on the ground. Somewhere deep inside the brain it must still register as a piece of chewing gum, 1/5 a pack of baseball cards, or 1/10 of a soda! And there is still that "interest" thing!

Black Blade (2/7/2001; 5:43:11MT - usagold.com msg#: 47669)
Goldfields Takeover?
http://www.businessreport.co.za/general/busrep/br_newsview.php?click_id=345&art_id=ct20010206181006346C432903&set_id=60
Analysts seem to agree that Hedge-Fund AngloGold and possibly Barrick are ready to make hostile takeover bid for Goldfields. Looks like the sharks are circling. Not a good sign.

- Black Blade

Canuck (2/7/2001; 5:09:17MT - usagold.com msg#: 47668)
@ Panda
Thank you.

As a 'heads-up' there have been many a heated discussion on this forum in regards to Guyatt's book.

Looking forward to your reply.

Canuck

Canuck (2/7/2001; 5:06:38MT - usagold.com msg#: 47667)
@ Belgian
My previous post was 'spawned' from your 47617 yesterday.

Yes, things are not as they seem, we ARE missing something fundamentally wrong. With all of the 'negative' events that have passed us by in the last year I find it bizarre that gold has actually dropped?

IMHO, I find it weird that that gold/oil ratio, normally around 16/17 seems to be slipping away. Oil is a massive vehicle, not easily 'managed' and an argument exists that rising oil is a function of an 'overvalued' dollar (in the eyes of oil producers) and changes in 'swing share'. Gold, on the other hand, is a small, easily 'managed' commodity.

We can speculate on the need to have gold 'managed' but I feel that 'how' that is being accomplished is more relevant.
You have hit the nail on the head with your comment regarding WHO 'is buying'. The movement of gold, has become MORE secretive and LESS transparent in the last couple years. I have speculated before that the massive, (and it is really quite substantial) dishoarding of offical gold may be simply a scumbag ploy to publicly announce sales of CB gold only to have secret, ultra-secret purchases by other CB's. A colluded, pirated merry-go-round.

CB's were holders of some 70% of above ground only a generation ago. That number has fallen dramatically in the last few years, thus, we can debate with each other for an eternity but we cannot argue with arithmetic, SOMEONE is sitting on a huge pile. In another convoluted theory, the theory of power shifting from west to east perhaps China, S.A.?, M.E.?, is gobbling the gold, setting up the 'sting' to finally drive the stake into the 'western' hearts.

The key is to locate the 'purchasers'; I agree wholeheartedly with your post, we are banging our heads on the wrong tree.

If you think how you have thought, you will get what you have got.

Canuck.

Pandagold (2/7/2001; 4:48:07MT - usagold.com msg#: 47666)
Canuck

Have not read this book, but next time I am in the bookshop, I will give it a quick scan - enough to tell me whether it is a 'genuine' revelation, or one that purports to be but is merely a smoke screen -which, regretably, most of them are - though they look, and are hyped as being expose

Knallgold (2/7/2001; 4:38:17MT - usagold.com msg#: 47665)
Harmony
"..As part of the deal Harmony has arranged gold price protection for the first year of the financing commitments through the purchase of 1.0 million ounces of put options at a strike price of around ZAR64,000 ($1=ZAR7.8000) per kilogram, the company said a statement. It said this arrangement would protect Harmony from potential adverse movements in the gold price, whilst allowing the company to fully participate in any increase in the gold price..."

Fact is,HGMCY started to hedge.
Fact is,Harmony speculates now in the paper Gold market.
Fact is,you can lose your money with puts.Remember NEM in 99,bought puts before the big runup in the POG,"for protection".
NEM posted a loss later,reason:
"hedge related", they stated.

This speculation is just to kiss the cabals butt,not for the benefit of the mine.

Back to Harmony: some unnnamed analysts were running around the last weeks trumpeting "Harmony starts to hedge,forward sales etc."

Swanepoel denied that in a statement,he never would hedge,even if he had to abandon the deal.Buy only what you can afford.Haha.Why did he tell this?

Salami tactic?
Now we see the details "ah,just puts.only a year.not as bad as expected (forwards) etc"
But what comes next?As the shareholders have been prepared now?Someone wrote on GE how friendly AngloGold's management has been to their shareholders the last weeks.Sugarbread to lull short-before-exploding investors?

If the POG goes to zero as FOA said,then the puts were probably a good deal.

Another thought:is this ANGLOgold selling related to BOE stopping sales soon?

Canuck (2/7/2001; 4:29:04MT - usagold.com msg#: 47664)
Secret Gold Treaty
http://www.deepblacklies.co.uk/main_page.htm
Ladies and Gentlemen,

I missed the boat on the discussions about David Guyatt's and of his book (above link).

I vaguely recall the discussions here on USAGOLD but I seem to remember Guyatt's theory regarding the cabal's plot to secure 'all' the gold.

Does anyone have any thoughts, quotes or perceptions before I purchase the book.

TIA,

Canuck.

Topaz (2/7/2001; 4:23:57MT - usagold.com msg#: 47663)
ski
Just in case anyone else doesn't mention it (I'm off to bed) your commentary here is most welcome.
Just put GOLD in the posts now-n-then! ;-)

Topaz (2/7/2001; 3:56:52MT - usagold.com msg#: 47662)
Horatio: Lafisrap
The Gold conundrum is definitely most confusing.
Barbaric relic or Wealth of ages, a black or white question - no half measures here eh?
Maybe, if we all share our basic reasons for gravitating to Gold together, (as Sir beesting has so ably demonstrated) we may ALL feel on more solid ground in these harrowing times.
My interest in PM's began in the mid 60's as a Teenager. As such coins were a much larger part of the "in-hand" currency and I remember feeling absolutely ripped off when our Silver coins were fazed out in preference for the junk of today.
The intervening 30 odd years found me living from hand-to-mouth, raising 3 kids, paying off a house etc and only in the mid 90's, on news that Australia had sold/leased a large chunk of their (OUR) Gold was my interest re-kindled.
Now Gold is Oz's THIRD LARGEST export earner, why - WHY would the Reserve Bank of Oz so blatantly act against it's own countries interests? (RBA was (one of) the first CB's to dishoard)
As an unelected body the RBA is akin to your FED - ie: our democratically elected officials have NOUGHT to do with RBA decision making, so they act idependantly of Gov't. D-uh!
At roughly the same time, as if by magic, the bulk of Oz Miners began forward selling Au. Throw into the mix the Seth Effrican "problem",the Gulf War, Anothers early efforts and the continually informative commentary found here - and one can plausably come to the following conclusion:-
The 80's run-up in POG threatened the very foundations of Global (fiat) finances as it became apparent certain parties were prepared to pay ANY price for Gold.
Enter Petrogold - as time passed, the security of large hoards of Bullion became suspect and a goodly amount of private gold was placed in secure storage (BB's) and paperised in the process - covered by CB sales/leases. (POG began it's steady decline)
These positions were feasable only if the (increased) Global production of Bullion outpaced demand and it DIDN'T!
Enter Miner Fwd's - so the miners got dragged into the act to cover (in Bullion) the defecit in production as it became apparent someone's tail(s) was/were/are exposed BIGTIME.
Any threat to the flow of Bullion (a-la the S/African situation) was quickly settled or/and (as Horatio pointed out) sold into.
Here and Now - POG $263, another rash of forward sales, Petrogold in accumulatiion mode, The Mid-East walking on eggshells "again", Enter the Dragon, say goodnight Buckaroo!......What goes around...etc!
As far as Another's thoughts go (oil-n-all) I feel his message is still as good as gold, Only when he (she) was cajoled into a western minded discussion did he offer narrow focused timelines pertaining to the future of POG etc. "time will prove all things" if I recall correctly.
Thanks for reading.

Pandagold (2/7/2001; 3:34:51MT - usagold.com msg#: 47661)
GOLD

The chairman of Austrralia's largest gold mine - Normandy:-

" In our Annual Report, I made reference to accelerating 'new economy' uses in leading-edge medicine, science and technology. These uses are less well known
and as a consequence we have received requests for further information.

These high-tech applications are possible because gold offers a unique combination of properties. It is non-toxic and biologically benign, and one of the most efficient conductors of electricity. It is virtually indestructible, soft and easy to work, allowing it be drawn out into microscopic strands, whilst its density allows molecular-size particles to be seen under electron microscopes.

Whilst gold is critical to the operation of all modern electronics and telecommunications systems, its unique properties are being increasingly applied to many other areas of science and technology:

In medicine, coronary stents (tiny scaffolds used to prop open blood vessels once cleared during balloon angioplasty procedures) have been gold-coated to improve their visibility during surgery, and gold vapour lasers have been developed to selectively destroy cancerous cells without harming adjoining healthy cells. - Lightweight lasers using gold-plated mirrors have been developed for military use, enabling battlefield wounds to be sealed in the field. -

Scientists are attaching gold 'tags,' ranging in size down to 4 atoms, to proteins and other molecules, to learn how drugs, bacteria and viruses travel through the human body. - In environmental and forensic evaluation, an extremely sensitive laser-based detection system has been developed using gold to provide a signal more than a million times stronger than other metals for chemical investigation of minute amounts of materials.

There are also many less exotic but equally important uses, with car air bag deployment systems just one example. In the United States, dual air bags are now mandatory. Air bags, to be life-saving, must work flawlessly for the 15-year life of the car. Only gold-plated electrical contacts can be relied upon for resistance to corrosion in a hot and dirty environment which is subject to vibration.

He went to say

Every time another gold mine closes, and there have been four significant
closures in the past few months, and every time an exploration budget is
reduced or a team disbanded, we are one day closer to an upturn in
the gold price and a return to positive investment sentiment.
Robert J Champion de Crespigny Chairman and Chief Executive

Pandagold (2/7/2001; 3:34:24MT - usagold.com msg#: 47660)
GOLD

The chairman of Austrralia's largest gold mine - Normandy:-

" In our Annual Report, I made reference to accelerating 'new economy' uses in leading-edge medicine, science and technology. These uses are less well known
and as a consequence we have received requests for further information.

These high-tech applications are possible because gold offers a unique combination of properties. It is non-toxic and biologically benign, and one of the most efficient conductors of electricity. It is virtually indestructible, soft and easy to work, allowing it be drawn out into microscopic strands, whilst its density allows molecular-size particles to be seen under electron microscopes.

Whilst gold is critical to the operation of all modern electronics and telecommunications systems, its unique properties are being increasingly applied to many other areas of science and technology:

In medicine, coronary stents (tiny scaffolds used to prop open blood vessels once cleared during balloon angioplasty procedures) have been gold-coated to improve their visibility during surgery, and gold vapour lasers have been developed to selectively destroy cancerous cells without harming adjoining healthy cells. - Lightweight lasers using gold-plated mirrors have been developed for military use, enabling battlefield wounds to be sealed in the field. -

Scientists are attaching gold 'tags,' ranging in size down to 4 atoms, to proteins and other molecules, to learn how drugs, bacteria and viruses travel through the human body. - In environmental and forensic evaluation, an extremely sensitive laser-based detection system has been developed using gold to provide a signal more than a million times stronger than other metals for chemical investigation of minute amounts of materials.

There are also many less exotic but equally important uses, with car air bag deployment systems just one example. In the United States, dual air bags are now mandatory. Air bags, to be life-saving, must work flawlessly for the 15-year life of the car. Only gold-plated electrical contacts can be relied upon for resistance to corrosion in a hot and dirty environment which is subject to vibration.

He went to say

Every time another gold mine closes, and there have been four significant
closures in the past few months, and every time an exploration budget is
reduced or a team disbanded, we are one day closer to an upturn in
the gold price and a return to positive investment sentiment.
Robert J Champion de Crespigny Chairman and Chief Executive

Randy (@ The Tower) (2/7/2001; 2:52:46MT - usagold.com msg#: 47659)
High-grading some gold philosophies from yesterday's forum
A good way to start the day?
Thanks beesting and slingshot for tolerating my use of excerpts upon your words. Let's get to it...

beesting (02/06/01; 14:29:44MT - usagold.com msg#: 47612)
The Image of Lady Justice...Gold as an investment v s Gold as a storage of wealth!
...I recieved the mental image of Lady Justice??....The blindfolded figure of a maiden trying to balance two Golden plates with known evidence to reach a conclusion.

...using the current low price of Gold anyone that had invested in Gold in U.S. dollars since it's high of $880 per ounce would have lost dollars. A poor investment to be sure....... But, my friend, did we close the case with all the evidence presented, or just part of the evidence?

Now, it's my understanding as a long time investor the phrase; "Timing is Everything" was not given it's proper weight measure in [that] scenario...

...lets see what would have happened in 1973 if I had taken my $20,000 and invested in physical Gold. Gold was $35 per ounce. If I divide $20,000 by 35 I come up with about 571 ounces excluding premiums. 571 times $265 per ounce Gold equals $151,315....A pretty good investment..

Now what if I had sold my 570 ounces of Gold when Gold was $850 per ounce, that equals...$484,500...I would say an exceptional investment... and that was over 20 years ago.

I'm only trying to prove the point timing is everything when it comes to investing.

Now, lets say a person is buying Gold for a different reason. ... and IMHO this is the reason USAGOLD puts up with our silly nonsense...That reason is "Wealth Preservation"!

Many people spend all their income on living expenses?

Now, say you would like to be different and have something to show besides your home and investments as you get older. Isn't untaxed (by the year) Gold the perfect vehicle for that? If a person sets aside say 10% of their monthly budget for...other use...and splits "other use" into 50% investing and 50% wealth preservation.... Does that seem like a good long term plan for anybody?

I think we should put up another scale of Lady Justice and see how other other wealth preservation vehicles compare to GOLD! I think not only Goldhearts, but almost anyone that weighs all the facts would agree, Gold has historically been and still is the best vehicle for long term preservation of wealth!...Thanks for Reading...beesting.

- - - - - - A N D - - - - - - - - - - - -

slingshot (02/06/01; 18:35:27MT - usagold.com msg#: 47632)
Confidence, Getting The GOLD.
The past several weeks I have read quite a few postings that sometimes I became slightly confused. Not to worry, adhering to my plan of acquisition of Gold keeps me from falling off the trail.

Standing at the bottom of the ladder, looking up at those who have played the gold game for sometime, I can't help but wonder how many have passed up this forum because of the huge amount of information that must be absorbed to understand a small amount of the fundamentals of the market. Thus they have missed the chance of climbing the ladder to wealth. .... Now that Gold is at a bargain price I have tried to talk to a couple of friends and the subject about gold was a flop! They must be in debt up to their ears. Now to the point of my post. I have confidence that I am making a great investment. Gold is at or near the low in [22] years. If it goes lower I just buy more with my allotment.
- - - - - - -

Randy's comment: There are certain times to be found in economic history where gold offers more than preservation of wealth. We seem to be on the threshold of one of those times where gold's price is very attractive in the light of "troubling" monetary developments/conditions, setting the stage for potential real gains in purchasing power per ounce (measured against other goods and services not limited to simple currency gains.)

Have YOU yet established a personal strategy to regularly "get you some" in the course of these interesting times? Call Centennial today. That's what they're there for, it's all they do, and they're exceptionally good at it too.

Black Blade (2/7/2001; 2:35:42MT - usagold.com msg#: 47658)
GOP Senators To Pitch Energy Bill
http://dailynews.yahoo.com/h/ap/20010206/pl/energy_congress_1.html

By H. JOSEF HEBERT, Associated Press Writer

WASHINGTON (AP) - Republican energy legislation to be introduced next week will focus on boosting clean coal technology, revitalizing the nuclear industry and finding new sources of oil and natural gas including drilling in an Arctic wildlife refuge, according to a draft of the bill. Sen. Frank Murkowski , R-Alaska, chairman of the committee that will take up the legislation, discussed the measure during an hour-long meeting Tuesday with Vice President Dick Cheney , who heads a presidential task force on energy. Murkowski said the meeting ``revolved around the realization that we have an energy crisis in this country'' and that ways must be found to produce more energy and rely less on oil imports. The legislation will outline a goal of cutting foreign oil imports from the current 56 percent to 50 percent by 2010, said Murkowski. It would require an annual report to Congress on progress toward meeting the goal. The Republican bill, parts of which will be met with stiff resistance from Democrats, is likely to be merged with a broad energy plan being developed at the White House. Cheney told senators that plan is expected to be completed in 45 to 60 days. But it is clear congressional Republicans and the White House are moving along parallel lines on the energy package, its importance magnified in recent weeks by the electricity supply problems in California and soaring natural gas prices nationwide. While the GOP legislation will include some measures aimed at boosting renewable energy sources and energy conservation its focus will be on boosting energy production.

``It's a blank check to the oil, gas and nuclear industry,'' said Erich Pica, an economic policy analyst for Friends of the Earth. Among the bill's most controversial provisions will be opening the Arctic National Wildlife Refuge to oil and gas development. Most Democrats and a handful of moderate Republicans oppose drilling in the Alaska refuge which is viewed by environmentalists as a national treasure needing protection. President Bush has repeatedly called for developing the reserve's oil and gas resources, maintaining it can be done while protecting the environment. While some senators contend it could jeopardize the energy package's approval, Murkowski said that both Bush and Cheney are convinced the refuge drilling provision should be in the bill.

Despite the recent turmoil in the California electricity markets, the legislation does not attempt to address the broad question of electricity reliability, nor the national question of electricity deregulation. The draft legislation, however, calls for streamlining siting requirements on electric power plants, electricity transmission lines and natural gas pipelines. It also proposes:

-A string of tax incentives aimed at promoting clean coal technology and continued reliance of coal, which currently produces more than half of the nation's electricity.
-Tax breaks for oil and gas development, including for marginal producers and so-called ``stripper wells.''
-A reduction in royalty payments for deep-water oil and gas developments.
-New incentives, including federal payments, for increased power production from nuclear plants and to help design and develop a next-generation nuclear power plant.

As Bush proposed during his campaign, the legislation would require that some of the proceeds from oil and gas leases in the Arctic refuge be used for research and promotion of renewable energy sources. It also proposes a revival of tax credits to homeowners who use solar, wind or other renewable energy; ratchets up the fuel efficiency requirements for federal vehicle fleets and provides general tax credits for hybrid gas-electric motor vehicles.

Black Blade: Another take on a revitalized "Energy policy." Still, it could be a tough sell, as environmentalists gather their legions of lobbyists and lawyers to stop or slow down implementation. There is a severe energy crisis coming and it's in the cards. There is no stopping it now. The energy crisis will spur many to work toward a solution. If you have Y2K type supplies, then you're in good shape. Next, protect your portfolios with diversification into PM's, pay off debt where-ever possible, and hang on. In might appear as a slow-burn at first (maybe a year or two), and then it will likely hit hard with some economic hardships to follow. The "Bull Market" was fueled with "cheap energy", and that energy isn't going to be so cheap anymore.

Black Blade (2/7/2001; 2:20:58MT - usagold.com msg#: 47657)
Judge Orders Power Sales to California
http://biz.yahoo.com/rb/010206/fy.html

By Michael Kahn
SAN FRANCISCO (Reuters) - With the plug about to be pulled on federally-ordered electric supplies to power-starved California, a U.S. District judge on Tuesday ordered one major generator to keep pumping energy to the state's 34 million consumers. Three others agreed to keep the lights on until at least a Wednesday court hearing. Judge Frank Damrell issued a temporary restraining order requiring Reliant Energy Services Inc. (NYSE:REI) to continue selling electricity to the California Independent System Operator (ISO), which manages the state's power grid. The ISO had sought a federal court order earlier on Tuesday to require four independent merchant energy companies to keep selling electricity to the state even though California's two biggest utilities are nearly bankrupt and cannot afford to buy supplies. The judge's order, however, will apply only to Reliant as generators Williams Cos. (NYSE:WMB), AES (NYSE:AES) and Dynegy (NYSE:DYN) agreed to keep supplying electricity at least until another court hearing on Wednesday afternoon. The order also came hours before federal orders mandating continued energy sales to California expire at midnight Pacific time (3 A.M.Eastern).

Meanwhile, Gov. Gray Davis announced that the Department of Water Resources -- transformed by emergency orders into California's main agent for state power purchases -- had secured its first long term energy contracts. ``I am very satisfied that this first round of proposals has met our expectations,'' David Freeman, whom Davis named last week to head up the contract negotiations, said in a news release. ``These power purchases are a critical first step as we begin to build a balanced portfolio of contracts.'' The maneuvering in Sacramento came as California struggled through its 22nd consecutive day of critically short energy supplies. While the ISO said a repeat of last month's rolling blackouts was unlikely, power reserves remained frighteningly low at just 1.5 percent of peak demand -- or about one tenth the reserve cushion most grid operators like to maintain.

REGULATORS SEEK COURT HELP

California's energy crisis, created by surging demand, spiraling wholesale prices and fallout from the state's failed 1996 power deregulation plan, has pushed the state's two largest utilities to the brink of bankruptcy. Pacific Gas and Electric Co., the utility subsidiary of San Francisco-based PG&E Corp. (NYSE:PCG), and Southern California Edison, a unit of Rosemead, Calif.-based Edison International (NYSE:EIX), have racked up $12 billion in debt buying power at sky high spot market prices that, under the terms of deregulation, they cannot pass along to consumers. Their finances in tatters, both utilities have found themselves shunned by power suppliers who fear they will never be paid. With the prospect of more blackouts hitting the nation's richest and most populous state, the Clinton Administration last month ordered power suppliers to continue their sales to California -- an order which was reluctantly extended by the incoming Bush Administration. But that federal lifeline runs out at midnight on Tuesday and federal officials said there will be no further extension. A separate federal order requiring natural gas suppliers to keep doing business with California's utilities was also to expire at midnight. With the clock ticking, the ISO filed suit with U.S. District Court in Sacramento seeking to force the four power suppliers to honor ``participating generator agreements'' the ISO said committed them to maintaining power sales to California. While three of the generators voluntarily agreed to continue supplying power, all sided with Reliant's concerns about whether the ISO could pay for the power supplies. But Norma Formanek, an attorney for the ISO, said that without a court order to keep power flowing past midnight Tuesday, the energy crisis could spread. ``There could either be rotating blackouts or we could have something significantly less controlled and which could go beyond the borders of California,'' she told the court.

LONG-TERM CONTRACTS SIGNED

Davis, embroiled in the biggest economic and political crisis of his career, announced on Tuesday that efforts to stabilize the energy supply moved forward as the state inked its first long-term contracts for a total of about 5,000 megawatts for terms ranging from three to 10 years. One megawatt is the amount of electricity used at any given instant by about 1,000 homes. Under terms of a rescue package pushed through the state legislature last week, the Department of Water Resources will take up the role of energy buyer for California -- which, in turn, will issue up to $10 billion in bonds to cover the costs of the power purchases. Long-term contracts, which usually carry prices far lower than those found on the volatile spot market, are a key component of that plan, and California last month held its first ever auction to solicit bids. David Freeman, Davis' point man for the power purchases, said Tuesday that the state had agreed ``basic commercial terms of price, quantity and term for power contracts'', with initial deliveries of about 500 megawatts and subsequent contracts building to approximately 5,000 megawatts over the next couple of years. ``The deals we have completed are competitive,'' Freeman said. ``It is critical that the state build its portfolio incrementally.'' Davis, in moves over the past several days, has already seized long term contracts held by PG&E and Southern California Edison before they could be put up for sale to benefit the utilities' creditors -- securing a total of some 1,425 megawatts in continued energy supplies at relatively low, long-term prices.

Black Blade: None of these measures addresses the fundamental problems inherent with Kalifornia's so-called deregulation. There still aren't enough energy generating facilities and power is purchased from out of state. They are far from out of the woods on this issue. They merely are drawing on power from facilities out of state that in turn will put pressure on the other states should there be a need for power. This scenario will likely occur, as low water levels on the Columbia River hydroelectric system will be stressed. Low snow pack in the Sierras will also pressure Kalifornia's own hydroelectric facilities. Summer is usually the state's highest energy consumption period. Since Kalifornia is the world's sixth largest economy, this has some serious implications for the US economy as a whole. If they come to rely on judges� injunction orders in order to acquire energy, this will only contribute to the spread of the energy crisis to the western states region (the western energy grid). Part of the problem facing the Grasshoppers is that they did not completely deregulate and allow the Utes to acquire long-term contracts longer than 3 months. Now Kommissar Davis is doing exactly what he and his fellow Grasshoppers denied to the Utes. watch for this to continue as it plays out in the economic down-turn. They are in for some "Interesting Times." "And they danced, sang, and played all summer long�"

Black Blade (2/7/2001; 1:26:40MT - usagold.com msg#: 47656)
Speculation on AngloGold's True Motives
The AngloGold forward sales of 50% of their gold production is likely to put some pressure on gold prices. The question is does this 50% forward sales position of 3.5 million oz. Per year (17.5 million oz total) include their approximately 20% forward sold gold or is this in addition to the 20% forward sold gold? Could AngloGold be forward sold up to 70% of their next 5 years of production? Just about a week ago, they claimed that they saw upside potential in gold prices. Why the sudden change in sentiment? Unless they are building up a "War Chest" in order to make a run on smaller miners, possibly even unhedged miners such as Goldfields. Then what? Perhaps they intend to acquire unhedged miners and forward sell more gold. They also claim that they prefer to merge rather than acquire, however, their past performance where the truth is concerned makes one question the veracity of anything they say publicly.

- Black Blade

ski (2/7/2001; 1:16:21MT - usagold.com msg#: 47655)
Spot Uranium Up Again
http://uxc.com/top_review.html

Last week I posted that uranium spot prices move like no other commodity to my knowledge. They only go in ONE direction for a considerable period of time and then in the other direction. No up and down movement from week to week. They move like a supertanker on the high seas.

I also stated that the downward movement in uranium prices finally turned last week as it had gone up fifteen cents per pound to $7.25 after going down for a couple of years.

This trend has been further confirmed this week. The supertanker has even picked up speed. Spot price is up twenty-five cents this week to $7.50. Also confirming this move is the fact that Cameco made a new 52 week high today.

I do not expect to mention uranium again on this site as uranium is not a precious metal therefore the subject is somewhat a little off base (unless someone wants to know more). The main reason that I have mentioned it is that uranium is used to make about 20% of the world's electricity and thus is a factor in "The Big Picture".

And lastly, some (Doug Casey, Jim Dines and others) have said that the supply and demand imbalance is more extreme than in ANY OTHER COMMODITY at present.

Black Blade (2/7/2001; 0:55:37MT - usagold.com msg#: 47654)
Stranded Alaska natural gas waits for buyers

By Yereth Rosen

ANCHORAGE, Alaska (Reuters) - Call it the Alaska pipe dream.

For years, government and business leaders have yearned for a pipeline to ship the North Slope's long-neglected natural gas to markets. It would be the biggest private project in Alaska since the trans-Alaska oil pipeline was built in the 1970s, creating thousands of construction jobs. It would also fatten Alaska's petroleum-based state treasury, providing an estimated $200 million to $400 million in steady annual income, according to the state Department of Revenue. And it would encourage other economic development by providing energy to isolated communities. Now, with prices spiraling upward, experts predicting future demand growth and supply shortages and pipeline technology improving, the long-discussed gas commercialization project finally appears on the verge of reality, Alaska leaders say. "After two decades of false starts and broken dreams, the economic and political stars are finally aligned in our favor. Natural gas is the fuel of the 21st century," Gov. Tony Knowles said in his state-of-the state address last month. The prospects seem serious enough that state economist Neal Fried in January received his first out-of-state job inquiry about it, from a Nebraska man seeking a welding position. Fried, a college student in Fairbanks during the 1970s oil-pipeline boom, said the gas talk reminds him of the past. "There's some feelings of deja vu about it -- not as strong, but they're there." Some say Alaska's next boom is inevitable because Prudhoe Bay and adjacent oil fields are swimming in natural gas. Proven reserves total 25 trillion cubic feet at Prudhoe and another 10 trillion in other fields -- more than a fifth of known national stores. Additional gas at already developed North Slope oil properties is believed to be at least 70 trillion cubic feet. No one has yet committed to buy the gas, however. It remains stranded on the North Slope, where it is pumped up through the tundra as a byproduct of crude production. Each day oil producers bring up about 8 billion cubic feet of gas, about the same as the national consumption of Japan or Canada. And each day they use the world's largest gas processing plant to re-inject almost all of it back into the earth, where it builds reservoir pressure and aids in future oil recovery.

'MORE DIFFICULT TO SHOVE THAT GAS BACK'

Producers have a growing incentive to do something else with the gas as the oil fields age and gas-to-oil ratios rise, said Matt Berman, a University of Alaska Anchorage economist. "It's getting more difficult to shove that gas back in." The producers say they are serious about selling the gas and commercialization plans have taken on a new urgency. "If it didn't feel different I don't think that we'd be spending 75 million bucks and putting 90 people to work on the project," said David MacDowell, external communications manager for a gas work group set up by major North Slope oil producers. The producers -- BP, Phillips and Exxon Mobil -- consider a pipeline delivering to the Lower 48 states to be the best chance to sell North Slope gas. They have predicted that a pipeline could be delivering gas by 2007 and that a pipeline to bring gas from the distant North Slope would cost $10 billion. Their work group last month solicited bids to plan and design the pipeline system, considering alternative routes. "Our focus right now is creating the most economically viable, safest delivery system possible," MacDowell said. Knowles and other Alaska politicians have endorsed a 2,000-mile (3,240-km) gas pipeline that would run south from Prudhoe Bay to Fairbanks, then to Alberta along the route of the Alaska Highway. A similar project was planned and permitted in the 1970s but was set aside because of poor economics. Knowles last month introduced legislation to give tax incentives for such a pipeline and he has established a special multi-agency state office to provide what he called "one-stop permitting and right-of-way preparation." A competing project would run a pipeline east off the coast of the Beaufort Sea to the gas-rich Mackenzie River Delta in Canada's Northwest Territories, then south to Alberta. The so-called northern route would be shorter and possibly cheaper and has the blessing of the Northwest Territories government, which is seeking a way to market its own stranded Arctic gas. But it is opposed by Alaska and Yukon officials, whose lands would be bypassed, and environmentalists are leery of impacts offshore and on wild lands. "If a pipeline is going to happen it really should stay in an already existing corridor that's easily accessed and doesn't have the ice problem," said Debra Moore, Arctic coordinator for the Fairbanks-based Northern Alaska Environmental Center. Another project would run a pipeline parallel to the existing 800-mile (1,300-km) oil line to Valdez, then liquefy the natural gas for shipment by tanker vessel to Asia or the U.S. West Coast. Its chief promoter, Anchorage-based Yukon Pacific Corp., portrays it as the most beneficial to Alaskans.

'AL-CAN OF WORMS'

Yukon Pacific President Jeff Lowenfels dismissed Knowles' preferred route. "We call it the Al-Can of worms," he told state lawmakers, using the popular nickname for the Alaska Highway. Another project would employ new technology to convert natural gas to liquid synthetic crude, which could be shipped through the existing oil pipeline. But some say cheerful predictions of imminent gas commercialization are unwarranted. And consumer watchdogs are worried about state concessions being contemplated to encourage gas development. "We need to proceed very carefully to ensure that Alaskans truly benefit from their own resources. Alaskans cannot afford to be the victims of BP's or other oil companies' marketing manipulations," Jim Sykes of the Alaska Public Research Interest Group said after Knowles unveiled his legislation. Berman said recent gas price spikes may be making politicians too giddy about Alaska gas. "I would be very suspicious of anybody who thinks the current high prices are going to last," he said. There is a "virtually unlimited" amount of Middle Eastern natural gas, now being burned off, Berman said, adding it is only a matter of time before that gas is exported, in liquefied form, to the United States. "Alaska natural gas has to compete in terms of price with imported LNG, and it always has." The unfulfilled promise of North Slope gas is also noted by environmentalists, who argue it is absurd for the oil industry to push to exploit Alaska's Arctic National Wildlife Refuge when it already has access to such a huge gas resource. Former U.S. Interior Secretary Bruce Babbitt, in a farewell address last month, cited the North Slope's gas when he criticized proponents of Arctic refuge oil drilling. "It seems to me that if those folks who are gearing up for this crusade and this fight are serious about something other than just an ideological assault on our environmental accomplishments," Babbitt said, "they might turn to the oil companies and say, 'Well, why don't you start with the 25 trillion cubic feet that you're sitting on?"'

Black Blade: NG is the fuel of the future as it meets the requirements outlined by the EPA's Clean Air Act. Canada is opposed to the project for no other reason than it would compete with their NG production in the NW territories. The environmentalists are just too powerful with their legions of lobbyists This NG could help mitigate the energy crisis a bit. However, the use of coal, oil and nuclear power would be a source of "cheap energy." It is too late to stop the inevitable energy shortage that will ultimately undermine the economy. We have already seen a tremendous slowdown in the economy with earnings warnings galore and increasing numbers of lay-offs. The Wall Street pundits claim that even though jobs are lost, many more are created. True, but how many "Burger-Flippers" do you really need? All the while, these pundits continue to harp on how everyone should just jump in and "Buy the Dips" and we have bottomed. They have been saying this for several months even while the DOW dipped, and the NASDAQ cratered in a traditional Bear Market. While the politicians bicker over exploring for hydrocarbons in ANWR, Reregulation of utilities, and suspension of the Clean Air Act, the time of economic collapse draws near.

Black Blade (02/07/01; 00:14:33MT - usagold.com msg#: 47653)
S Africa's Harmony Secures Funding For Mine Acquisitions

CAPE TOWN (Dow Jones)--South Africa's Harmony Gold Mining Co. (HGMCY) said Tuesday that it has secured the funding for the acquisition of AngloGold Ltd.'s (AU) Elandsrand and Deelkraal mines, and Australia's New Hampton Gold Fields Ltd. As part of the deal Harmony has arranged gold price protection for the first year of the financing commitments through the purchase of 1.0 million ounces of put options at a strike price of around ZAR64,000 ($1=ZAR7.8000) per kilogram, the company said a statement. It said this arrangement would protect Harmony from potential adverse movements in the gold price, whilst allowing the company to fully participate in any increase in the gold price.

Harmony is paying ZAR1.0 billion for Elandsrand and Deelkraal and has offered New Hampton shareholders 26.5 cents which gives the New Hampton deal a transaction value of A$54 million. The banks providing the finance include South Africa's ABSA Bank Ltd. and BOE Securities, Australia and New Zealand Banking Group Ltd., Citibank NA and J.P. Morgan PLC. J.P. Morgan is acting as international coordinator and book manager, while ABSA Bank Ltd. is acting as South African coordinator and book runner, Harmony said. Around 1050 GMT Harmony was trading 30 cents higher, or 0.9%, at ZAR35.50 on the JSE Securities Exchange South Africa.

Black Blade: JP Morgan, I thought I smelled a rat! However, the picture isn't as bad as first thought as Harmony's hedges are only put options as opposed to forward sales favored by Hedge-Fund miners Anglo and Barrick.

Black Blade (02/07/01; 00:07:35MT - usagold.com msg#: 47652)
CATALYTIC GOLD INTERNATIONAL CONFERENCE
http://www.acitravel.co.za/main.asp?conf_id=2
GOLD, that most noble of all metals, is not traditionally renowned for having catalytic properties. That it has such properties at all is still news to many. However, what is really interesting is not that gold can be merely prepared in catalytically-active forms, but that such materials have unique and commercially attractive properties. In some instances catalytic gold seems to offer activity at unprecedented low temperatures, in others it offers the promise of greater selectivity. This is still a rather young topic - up until now many of the researchers and developers in this area did not even know about each other. The Catalytic Gold conference will, for the first time, bring together the worlds leading researchers in the field. The conference is more than just an academic get-together however - it is expected that it will also be attended by top delegates from the laboratories of many of the worlds larger chemical industries who, perhaps, may not say much but who are expected to listen carefully as the utility of these new materials unfolds. So the conference offers delegates a very effective way to work themselves into this new field technically and perhaps gain some useful strategic insights as well.

The excellent line-up of speakers, from leading institutions around the world, will be addressing topics from gold in the synthesis of fine chemicals, gold chemistry, catalytic gold in industrial processes, to the potential uses of gold in environmental remediation. These sessions, combined with an opportunity to meet with the speakers and other participants during our social programme, will ensure that you will return from Cape Town with new insights, new ideas, and new horizons. Pre and post conference tours as well as two post conference technical tour are available. A comprehensive accompanying persons programme is also available.

TECHNICAL COMMITTEE
G. Bond - Chairman (UK), M. Haruta (Japan), H. Kung (USA), D. Andreeva (Bulgaria), D.T. Thompson (UK), C. Corti (UK), P. Radcliffe (RSA), A. Vosloo (RSA), M.Cortie (RSA), J. Fletcher (RSA), R. Paul (RSA), S. Rule (RSA), A. Ramsey (RSA)

HOST INSTITUTES
World Gold Council, AngloGold, Catalysis Society of South Africa, Mintek.

Black Blade: Notice that Anglo is a sponsor of the Catalytic Gold Conference. It would be "interesting" if this technology became popular causing the POG to rise dramatically and therefore cause margin calls on Anglos hedge positions. Shades of Ashanti and Cambior. Just an "interesting" thought.

ViewYesterday's Discussion.

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