Foundational Gold Trail Commentary

The Inside Story on the Gold-for-Oil Deal that could Rock the World's Financial Centers

Page One
Oct '97 - Nov '97

- Page Two -
Dec '97 - Feb '98

Page Three
Mar '98 - Apr '98

Page Four
May '98 - Sep '98

"Think now, if you are a person of "great worth" is it not better to acquire gold over years, at better prices? If you are one of "small worth", can you not follow in the footsteps of giants? I tell you, it is an easy path to follow!" --ANOTHER (THOUGHTS!) 1/10/98

[Follow contemporary writings of "ANOTHER" and "Friend of ANOTHER" at the Gold Trail]

"If ANOTHER's claims are true -- that a consortium of oil states has cornered the gold market (and given the impressive circumstantial evidence, this could very well be the case) -- these "footsteps of giants" become the most salient and persuasive case for gold ownership I have seen in the past decade, if not the full twenty-eight years I have been in the gold business." -- Michael J. Kosares, president of Centennial Precious Metals, Inc.; author of The ABCs of Gold Investing

USAGOLD is pleased to offer these special pages of commentary that are sure to challenge conventional perceptions of the gold market and international monetary affairs -- made even more intriguing because this exceptional commentary is offered by two anonymous authors, "ANOTHER" and "Friend of ANOTHER" (FOA). Based on our ongoing association with these commentators, we are confident that the messages you are about to read will continue to be as fascinating and as worthy of careful study as anything you will find on the web today.

After watching the readership of their sometimes enigmatic but always thought-provoking commentary grow by leaps and bounds at our discussion forum, through this archive we can discuss the road ahead having all had a chance to travel this same route behind.

We encourage you to follow along (or to catch up), and then to join your friends at the USAGOLD Discussion Forum to share in the discussion. A note on the text: No attempt has been made to correct typographical errors, misspellings, punctuation, grammatical and/or textual errors as originally submitted. This archive of ANOTHER's online commentary is presented here in its unedited entirety in the order his "THOUGHTS!" were posted via the Internet -- beginning at the Kitco website (from October 1997 to April 1998) then proudly hosted here at our expanded USAGOLD website (from May 1998 onward) through mutual agreement and cooperation with ANOTHER.

Date: Sun Dec 07 1997 18:45

Will we have "Deja-vu" again?

Some people have followed the gold market from 1970. Some have followed it all their lives, depending on when you were born. Some say they were right, as the market has fallen and they held "no gold". They council from experience and a short life.

But, some have traded gold from times before. Those who trade with the sun know we will never have"Deja-Vu" again. This market is unlike anything from the past. And those with a "short life" of investing will learn from this coming future as gold will show their knowledge was limited to where they stood on the mountain!

Unlike the past, this market has an end. And this end will not be for those who have waited to buy! They see this bottom at $100 or $200 or $250, and they will buy at the turn as no fool should have held from $360! But, I say they will buy only paper if lucky!

All should make ready and be holding metal only, as the turn will move $100+ the first day and $200 the second day as comex is closed! It will trade no more from the 3rd day on! The gold market of your youth will be no more! For those who were smart from experience not to buy at $400, will look at $600 as "the deal of a lifetime".

To close,
Try to live in this outcome and see how different the world will be. It will not be the end of all things, only the changing of most things in "western thought". The "Digital Currencies" will still trade, but we will value them as not before. Anyone who has sold gold they do not have will not be allowed to cover that position. Anyone who has brought gold they do not have will not be allowed to cover that position. Many will lose all they have in a world without honor! Looking back , one will ask, "how could I have thought that noone wanted gold, when more of it was being brought than existed"? Indeed, more gold than exists or will be produced in the next ten years! And some say, "only a fool would say the market was cornered".

During that time, a gold stock in the hand will not trade on an open market! And the government of the country, of the land, of the mine, will no doubt speak with you of new taxes on GOLD!

A year has passed as the winds of change have started to blow. Waste no more time on paper gold, you have suffered enough. Play paper games no more, as the future of your family waits a decision.

Date: Sun Dec 07 1997 20:04

MoreGold and A. Goose,
We approach production costs, therefore we come to the end of this game. This is not lost to the oil states. They, along with three CBs are buying as this is written! The size of these orders could make the turn? We will see by way of a flat price over several weeks. If yes, then those with orders of a month delivery are to late. We approach unsettled times.

Date: Fri Dec 12 1997 21:06

Oil is only priced in US$ worldwide. Gold is only priced in US$ worldwide. It is important that this process of dollar backing continue, as it is the only thing keeping this "digital currency" alive! It is also important that all other currencies seek the US$ for backing, as they would not survive on their own. Why would not these countries just hold oil or gold for backing? Because oil is not buried in their back yard and real gold would bankrupt them in a minute. You see, a country can buy all the paper gold they want as that gold remains on deposit at the BIS controlled CBs. But, if they try to buy real gold outside the LBMA system the price would explode and the BIS would not come to rescue their currency. All real bullion outside the system must remain available at production cost prices ( in US$ ) for the cross trading of oil thru the LBMA. There are only two threats to the world fiat currency system at present. The oil states could stop buying US$ for oil and drop all paper gold for real bullion. Or, the masses could buy up all the physical supplies thereby breaking the OIL/GOLD/US$ bond.

The paper gold market controlled by the BIS/LBMA system is, alone equal to more than all the gold in existence. This market works like a hybrid currency using approximately twenty to forty percent of all CB gold in leased form as backing. The paper behind the lease is a form of CB/gold and is used as a "fractional reserve" that has built this huge market. This system has worked and does work well. You have but to look at the good value that is received when dollar debt ( digital currency ) is purchased with oil. The world works! But this system cannot continue. There is a limit to how far gold can be inflated in quantity using "fractional reserve leasing" as backing. The fatal flaw was found in the "forward sales" of unmined gold. The whole system counted on the expansion of cheap mining techniques to supply much more gold at a cheaper price far into the future. This happened to a degree for a few years but then just leveled off.

Now the LBMA continues to flood the market with paper gold as if nothing has changed! But it has, we reached production cost! That wasn’t suppose to happen until the mining industry had raised supply many times what it is today.

To close:
Notice that we say "they use oil to buy gold" and "they use oil to buy dollars". You should try to think in these terms as oil is the real value here. Oil functions as the true gold for the modern world. Indeed, it was only when the world started needing oil for everything that gold was dropped as backing for the US$ and replaced with oil!

The falling price of physical gold only hurts the mining industry ( and it's stockholders ) and leveraged paper buyers. All others benefit from a lower value of gold. Look now as even the western public are buying coins. They help themselves even in the face record Dow Jones.

Will the BIS try to settle this unbalanced market by destroying LBMA? Or will they drive the CBs to lease another 20% in an effort to inflate this "paper gold currency". Just like the fiat dollar, if inflated it loses value. This is not lost to the oil states.

Date: Fri Dec 12 1997 21:33

If you owned an oilwell in your back yard and no-one could take control of it, then oil is the best investment. But, most people use various forms of western paper to trade oil and that paper will burn in a currency fire. Make no mistake, a currency fire is now in process and it has much fuel remaining. Even Korea will find out that oil is all that counts. Their paper will die! Gold would have helped them in a different world, but for now gold is in the background as the IMF tries to add more paper to this inferno. If one owns real gold , it will be with ease to view the world currency developments. They will be truly of biblical proportions!

Date: Fri Dec 12 1997 22:31

What is "cloak and dagger"?

Date: Fri Dec 12 1997 22:45

It is a many hard question you ask. The transactions are still working, but some are "covering the back side" with real bullion. I ask you, when your worth in the ground is equal to much of the earth, is an IOU of the same future value?

Only gold has such a history book for reference. These people do not trust foolish thoughts of value from western minds. That history book is only in the first chapter.

This game is deep and one for your "007" to play.

Date: Fri Dec 12 1997 23:08

You will not see 80% or more of gold deals. If it was done with all to see the discount value would be lost as the world price would explode. This is not the relm of any public "wall street". At one time it belonged mostly to the Barron. Now it is large with the BIS and super rich. Wars will be fought over the lack of "visibility" of these dealings.

Date: Fri Dec 12 1997 23:29

I oil says "I am currency" and I will buy gold for $10,000/oz.. Then gold will be at that price. Then all the bullion reserves will ballance debt for oil states.

If Arabia says, "I will sell oil for $10US a barrel or in gold valued at $10,000" what do you think would happen?

If I had gold I would get oil very cheap! Or if I had only US$ I would have to pay the higher price of $10.

In this day this cannot be, in that day it will look correct. This has been discussed for that time to come.

I will be gone for a time.

Date: Tue Dec 16 1997 07:07

Mr. Allen ( USA ) :
Thank you for your thinking thru of my posts. I am told that you are "on target". Understand that using oil to back gold instead of the US$ is but one of several outcomes affecting the gold market at this time. This will be the final move as the currencies are destroyed. Gold at a much higher dollar price, as a result of oil/backing, will allow most paper economies to continue in operation. Gold will, in fact, become a "world oil currency" and be of national importance to all countries. In the same way that all oil in the middle east ( and most other major producing countries ) is nationally owned for the good of all, gold in the ground will be deemed a "currency reserve" for the good of all. During this time all other metals ( and paper investments ) will fail to hold value. Access to oil and gold will be next in line of importance behind food.

CB leasing/ lending is winding down as thoughts are changing. With the oil states going more to physical there is no point in maintaining the paper gold market. UBS was the first to be cut free. If you do not have physical yet, it will cost perhaps 100% more after the turn, if available at all. If the paper fire in ASIA burns too hot, at some point gold will not be supplied even before the turn!

Date: Thu Jan 08 1998 09:24

Much is happening now. Governments, IMF, BIS, LBMA and many others, are very much in the middle of this fire. Very large buy orders have stopped the CBs from lending now. The BIS has been asked/told "lower gold no more"! The US$ price has stopped. I will offer many thoughts on the 10th.

Date: Sat Jan 10 1998 21:03

 Someone once said, "noone wants gold, that's why the US$ price keeps falling". Many thinking ones laugh at such foolish chatter. They know that the price of gold is dropping precisely because "too many people are buying it"! Think now, if you are a person of "great worth" is it not better for you to acquire gold over years, at better prices? If you are one of "small worth", can you not follow in the footsteps of giants? I tell you, it is an easy path to follow! An experienced guide is not needed for this trail, look around you and see. The real money is selling ALL FORMS of paper gold and buying physical! Why? Because any form of paper gold is loosing value much, much faster than metal. Some paper will disappear all together in a fire of epic proportions! The massive trading continues at LBMA, but something is now missing? The CBs are no longer lending! They will not anymore! We have reached production costs. Oil will have nothing of "gold paper" if gold must stay in the ground! And a CB values the wishes of oil far above it's return of leased gold! Hear me now, "if gold tries to go lower than US$ $280 the BIS will buy it OUTRIGHT in the OPEN for all to see"! They must! They will! I know. For no currency system could stand if "Oil" were to bid for gold!

Oil has kept "the deal" as the CBs sold paper to lower golds price! All is fair. Asia will bid for gold not as in the past. They now know that the free flow of oil has more value than the Pacific economy. But the price that was paid may be more than the world currency system can endure.

To close:

The US$ has risen on a flight of fear. That will now end as the LBMA shorts are given to wolves. If this fire burns too hot, gold will turn and it's trading halted. The price of oil will explode as gold becomes the "world oil currency"! Even now oil has locked the IMFs gold, Asia will bid against them no more. We come to extreame times.

Risk not your wealth in paper, we enter a period of truth.

Date: Sat Jan 10 1998 23:49

You are exactly correct! Follow your thoughts. good luck

What quantity of GOLD, paper or physical, has OIL traditionally purchased on an annual basis?

From 1991, appx. 20m/oz./yr., now it is more.

How much paper GOLD is out there ready to be squeezed?

Over 14,000 tons.

Do you think OIL will be able to collect what is owed to them?

It will come outright or thru the increase in value of metal owned after an oil for gold bid.

Date: Sun Jan 11 1998 00:39

Mr. A. Goose:
The BIS is not a broker or trading house. They do not move with chart patterns or wall street directives. If gold drifts under 280 for any period of time, they must act to forstall a much worse outcome. That being; Oil will not allow Lbma to drive gold so low as to make the CBs the only suppliers. Oil will bid for gold and in doing so create an "oil currency" out of it. That outcome would make the current "currency debts" ( bonds ) next to worthless and turn the financial system upside down.

Date: Sun Jan 11 1998 01:16

I can not oppose your long term view. But, I can change the contents. Oil went from appx. 1.50/bbl./+/- to $20.00/+/- and the world changed. Many 3rd world countries ( mexico, exp. ) have been using the same currencies for many years, even as they were destroyed. The people only adjusted by adding the US$ as a value/mix. The same will happen when/if oil bids for gold. All nations will use the same digital currencies for all trade, but will also add gold to the value. The world will not end, it will change! As some say "not enough gold to use as a currency", I say "gold not valued high enough to use as currency". At a high enough value ( price ) it is an excellent currency! Oil now backs the US$ as a "digital world reserve trading currency". When oil backs gold as an "additional value to digital currencies" your view will be different.

Date: Sun Jan 11 1998 01:33
ANOTHER (Thank You.) ID#60253:

I must use another to express my knowledge, as position will not allow.

"Life takes us as winds on a storm, to what end we may never know".

Date: Sun Jan 11 1998 01:52

Nothing is assured! Life is a risk and subject to many changes.

I ask you, if the USA could not remove the Iraq leader when they were in full battle dress, then??? No, the US tanks are not a factor in this. The risk is to each person and how they hold their wealth. The concept of what wealth is, is going to change. Concept is but a thought and a thought of what value is, changes thru life. Time will prove all things.

Date: Sun Jan 11 1998 01:57

I must be away for a time. good luck

Date: Sat Jan 17 1998 16:44

We will talk today. Have your coffee or tea and bring a clear mind, as we will think of oil and gold. Yes, we will think thoughts not spoken for simple persons.

Later I will post, then we will truly consider.

Today, I stood in the sand and looked for life in the heavens. But even the stars offer no life as a strong body and a full mind. It is a fine night for a man of small thought, for he can consider GOLD.

Date: Sat Jan 17 1998 20:45

For those of simple thought, such as I, gold is good to own. But, for those of need for reason, read from one who speaks to me:

The Cornering of Gold!

The final outcome of "Too Much Oil", "Too little Gold" and "Worldwide Digital Currencies".

For years the governments could create currency out of nothing. But, during the last eight years, the modern currency systems have taken the final step. As digital charges in a computer, they have become but "emotional thoughts" of trading value. This is to say, "a currency unit exists only during the moment of trade". During this time, when real things are in transit, paper currency has value as an expected "trade completion". It exists as a human thought. Complete the transaction and the thought is gone, the currency unit dies.

Think about it? If for a time the world commerce stopped. All would live from what they had for, say a week. During this week, all currencies and the debts that back them would not exist! Without trade, modern currencies have no use, no value, no purpose.

During our modern age, a currency can be anything. Corn, lamps, cars, tables, anything could be used as a concept for a digital currency. You see, it exists in concept only. Even gold could be used as modern money. The real item is not used, only the concept of "how it would be used during the transaction of commerce". "Real value is not needed for modern money, as it is only used as a trading unit"!

What does all of this have to do with oil and gold? For most people, nothing. But for some people, everything! You see, some persons do not want to hold an "operating business" and the present value that represents, as their wealth. Nor do they want to hold encumbered assets or debts of others. Wealth, to these people, is not represented by a "digital trading unit of commerce".

History has shown how many persons, or groups of persons, have tried and failed while trying to corner a commodity. Greed was always the factor, as acquiring real wealth to pass on to family or country was never the aim. Using paper currencies ( or debts of the same ) to purchase these commodities, always brought on the undoing of the scam. During some years, even gold was used as a purchasing unit, as gold was the currency of that time.

But, today we come to a different period, with a different factor and circumstance. For during no period of history has an entity used a commodity to corner another commodity! The intent is not to "corner", but the result will be the same. This action is coming about because of a gross, huge mismatch of the value of gold and oil! We are not talking about the price of these items ( in any currency ) . We speak of the total amount of physical gold, worldwide and the total amount of oil worldwide. During the last twenty years, the world has made oil an absolute necessity for life as we know it. During the same time, gold has been degraded to a "kind of commodity that we may need sometime but, I'm not sure". With the public, government and the business community holding these thoughts, it is easy to understand which item is needed first and which would be dumped. In this day, people would sell gold for oil, no contest!

Consider the amount of oil that is used daily. Consider the future value that this consumption places on reserves in the ground. Compare this to the amount of gold consumed daily. Notice I said "consumed daily", not "traded daily". Clearly, the consumption of oil compared to the consumption of gold places a much higher value on oil reserves than gold reserves. With no replacement for the use of oil ( at present to lower prices ) and no "needed" use for gold in today's thought, we have the ingredients for a mismatch in value of epic proportions!

The supply of oil was a problem in the 70s. Several nations actually cut off the supply to make a political point. Many thought that the "embargo" was an attempt at "cornering" the oil market. We may never know the true reasons for the large increase in the price of oil, but one thing is clear. The value of oil in today's economy is of far greater importance to maintaining present "asset values" than at any time in the past. Today, the future value of all commerce is "well bid" into every asset value! Without oil in good supply , at a currency price that allows a reasonable lifestyle, all assets would lose much relative value.

This "need" for supply is not lost to governments or their Central Banks. No single asset class or segment of the economy, by itself is more valuable than the supply of oil. This brings us back full circle, to the problem of "digital currencies" and the "mind set" of much of the simple ( and rich ) third world persons. To many of these people, wealth is the surplus of life's work that you pass on after death. Currency is something you, spend, trade or hold for a few years. It isn't wealth. Gold ( and silver ) is "on the list", so to speak.

This same mindset creates a worry in the back of many a mind in the oil states. It is clear to most, that even a small amount of gold in the asset mix, makes one appear "less western" and therefore "less foolish" when the concept of value and currency are discussed. But, the problem has always been that oil is "so large" in relation to gold that any attempt to convert, even a portion of ones assets creates a distortion in the markets. Of further concern is that; everyone knows that western minds don't like or want gold, but if they think you like it they will trade it up in price for the sake of "sticking it to you".

Enter the world of "paper gold".

Yes, gold just like currencies has been "digitized". If you brought gasoline, made from oil sold under $20/bl, you are part of this system! For just as the "digital currencies" are created for trading only, paper gold was created for the trade of oil. In a very broad sense, it was created as an "extra" or "kicker" to allow the purchase of small amounts of cheap gold in return for a full supply of oil. In reality, this gold paper represents the future production of gold ( from the ground ) to balance the reserves of oil ( also in the ground ) . The huge amount of "paper gold" traded and outstanding today is now in excess of all the gold in existence above ground! In essence, it is of the same value as the currencies, "the thoughts of nations, blowing in the wind". The Central Banks gave value to this paper by selling and lending some of their gold stocks. But, as economies became hooked on cheap oil, and demanded more of the same, these same CBs had no choice but to use fractional reserve gold lending" to pump the gold market.

Now we approach the final act.

There is one oil state that no one will play for a fool. The CBs will sell all of their gold or the nations will nationalize all mines and operate them at a loss. One way or another, most of the paper gold market will be honored. Why? Because oil will bid for gold if they do not! We are not talking about an oil embargo or rising oil prices. Indeed, oil will become very cheap for those that can supply physical gold. This deal will not require the agreement of all oil states. Only one can start this, the others will gladly follow.

A large oil producer, with plenty of reserves and unused capacity, can say: We now value gold at $10, $20 or $30,000/oz.. That is the rate we will use to sell oil. We will go to "full" production and offer at $10.00us/bl.. Pay us in physical gold and USD ( or EUROs ) as a 50% mix to the above rate to equal $10/bl..

It would be a deal like none other! Oil, worldwide, would drop to $10.00/bl and every economy would do very well, IF they had gold. All gold would immediately be arbitraged to the above prices thereby creating a "world oil currency" large enough to handle oil. This creating of a new "specialized currency" will be the result of the first "commodity corner" that ever succeeded!

But what of the current currency/debt structure? We will cover that in a later article.

Date: Sat Jan 17 1998 22:07


Date: Sat Jan 17 1998 21:35
Tyler Rose ( ANOTHER ) ID#373164:
If, as you say, a major oil producer were to say that they value oil at $x per barrel, and we will take payment 1/2 in dollars or eurodollars and 1/2 in gold, then it would be to the benefit of that oil producer to "value" gold aslow as possible, in order that they would receive more gold for the 1/2 of the payment in gold.

Tyler Rose:
At this point of time the drive would be to make a usable currency. This would require a high value for gold. For gold to trade with oil on a physical basis would also require perhaps a small fraction of gold/bl.

All would gain from this. The intent is not to destroy the oil market.

Date: Sat Jan 17 1998 22:22


Date: Sat Jan 17 1998 22:06
Schultz ( ANOTHER ) ID#288349:

Your view is a good one. The perception of the US is one of your view from where you stand. Many do not hold America as a "taker without cause". At a low ratio of gold per barrel, with gold priced high enough, the USA would no doubt receive oil, relative to today at perhaps $8.00. The Us gold reserve and in ground reserve would last a great while. Also, the US gold reserve value would increase a great deal!

That, your Washington would understand, VERY WELL!

Date: Sat Jan 17 1998 23:00


Date: Sat Jan 17 1998 21:44
Mikey ( TO ANOTHER ) ID#347332:
What do you think of this new technology to convert gas to oil.

What about the vast reservoirs of natural gas in the US or anywhere else?

If the oil/gold trading brings on a worldwide currency crisis before oil can change the rules, the price of oil in all currencies would spike and destroy most economies and the oil market. This outcome is not wanted but may happen. In this scenario your natural gas would be of use, but your econemy would be gone. Gold would never trade again on a free market. If the oil priced in gold comes to pass, oil would be a much cheaper use than gas. Your reserves would have to wait for another day.

Date: Sat Jan 17 1998 23:19


Date: Sat Jan 17 1998 22:40
A.Goose ( Gold for oil... ) ID#20137:

There are many who would take your gold. Read my long post of tonight and place your life in that time. You will feel the threat against your holdings. If it is taken it will be for the good of all. Perhaps it is not bad. In all things, good life is more important.

Date: Fri Jan 23 1998 15:44


Date: Sun Jan 18 1998 09:46
sharefin ( Worth a re- read???? ) ID#284255:
ANOTHER updated plus a couple of old ones I found.

Mr. Sharefin,
Thank you for saving these. There is much more to this.


Date: Sun Jan 18 1998 09:37
A.Goose ( ) ID#20137:
Date: Sun Jan 18 1998 06:17
Junior ( @ ANOTHER ) ID#248180:
" The baseline I see from ANOTHER's comments set the final stage for fiat currency, as we know it today. I believe that ANOTHER's thoughts spell the death of the U.S. dollar as we know it today."

Mr. A.Goose,
Thank you for all your thinking ( only part of post is above ) . It has long been a worry that the US$ and it's oil backing would some day come undone. I will post tonight between your 6:00 & 7:00 US /EST. More thoughts and replies.


Date: Sat Jan 17 1998 23:55
JTF ( Areas of General Agreement ) ID#57232:
ANOTHER: I think there is much that we can agree on. I don't just mean myself, but fellow Kitcoites.
Here's to the future!

Mr. JTF,
There is much more to your post. You always consider all things. We look to the future for change, to change is to live!


Date: Sat Jan 17 1998 18:14
JTF ( I look forward to your comments! ) ID#57232:
ANOTHER: I would be very interested in your response to my comments regarding why "paper gold" trading cannot distort the price of physical gold significantly - - although price swings might be increased or decreased somewhat depending on the trading - - but not enough to shut down the gold trading market. My sources were D.A., a commodity trader who posts

I will discuss tonight! Thank you.


Date: Sat Jan 17 1998 13:53
Lurker 777 ( Another what? ) ID#317247:

Mr. Lurker 777,
You honor me sir. I only ask that you consider my thoughts. " a truth spoken is for the benefit of many and never a gain for only the one"

"Many outcomes can grow from earth, as nations cultivate the soil differently. To understand the climate, is to make ready for storm."


Date: Thu Jan 22 1998 18:51
Cmax ( ANOTHER/GOLD/OIL ) ID#339320:
For all you "doubting Thomas':

Sir, Some think my thoughts are as "hogwash"? Several CBs use "agents" to buy gold. Some agents, small, some large, some "BIG". They buy much from $365 down, all last year. Even today, it does not show. This world, it is strange, yes? I would say "Big Trader" has little time for "washing the hog"! But you sir have a large shovel and dig very deep!

It is written, "all holes in earth lead to china"!

Date: Fri Jan 23 1998 19:01

I feel this way also:
Do you really hold dollars?

It is important to understand that few persons or governments hold US dollars! Look at any investment portfolio and what you will find "are assets denominated in US$". This sounds simple, but it is not. You have heard the phrase, "money is moving into real estate, land, oil, stocks or bonds". It is a bad meaning, as it does not what it says.

All modern digital currencies do not go into an investment, they move THRU it. The US unit is only an exchange medium to acquire assets valued in dollars. US government bonds are the usual holding. No CB holds any currency! They hold the bonds of that currency. The major problem today, is that digital currencies have erased the currency denominations of all government/nation debt holdings! Even thou a debt is marked as DM, USA, YEN, they are in "real time" / "marked to the market" and cross valued in all currencies! No currency asset, held by CBs today are valued in the light of a single issuing country, rather "all currencies are locked together". To lose one large national currency, is to lose the entire structure as we know it!

There is an alternative. Gold! It is the only medium that currencies do not "move thru". It is the only Money that cannot be valued by currencies. It is gold that denominates currency. It is to say "gold moves thru paper currencies". Gold can be used to revalue any asset, and not be destroyed in the process!

Mr. JTF has asked: " I would be very interested in your response to my comments regarding why "paper gold" trading cannot distort the price of physical gold significantly - "


In times of plenty, people say one thing about physical gold, but in time of change they do the opposite. History has shown that when paper assets start to be revalued downward by gold ( gold rises ) , it's physical supply dries up! People and governments "HOLD" the real physical and trade the paper, even gold paper. Never before in history have we had a gold market such as today's! It has cross currents from every direction.

You have CBs that highly value gold, but need it's price in currencies to fall as a means of pricing oil.

You have merchant banks creating a huge "digitized paper gold" market for trading only.

You have other CBs holding gold in the form of "paper commitments" and calling it physical.

You have some CBs having nothing to do with any of this and buying in the off market.

And finally, we have the threat of gold becoming an "oil currency" with the risk of total nationalization by any country that is short of both oil and gold!

The Paper Gold Market today could completely destroy the physical market by shutting down all possible trading as the currencies are devalued by gold in a massive upheaval!

Date: Fri Jan 23 1998 19:26


Date: Fri Jan 23 1998 18:03
oris ( ANOTHER ) ID#238422:
Would you please explain today's action when gold went up $9.00 and oil dropped $0.30.

According to your scenario gold and oil should move in one direction.

Mr. Oris,
Oil is by far a much larger market than gold. Many times over. Oil may be taken to $12/US, but this is not a trading move. Only business. $12 oil did not require gold to drop below $320 or so, as gold must stay above perceived production cost. The drive to $280 was by the paper market outside. The intent is for long term asset balance not destruction! However, the currency market is close to taking extreme moves. That will over ride intended results.

Date: Fri Jan 23 1998 19:46


Date: Fri Jan 23 1998 19:19
aurator ( & c. ) ID#255284:

Mr. Aurator,
Silver will always be part of "gold money". But, is far too small a market for large, modern economies. Silver will do far better than any paper asset, only it will serve better as a "personal holding" than as a major money. If it is of your way to balance wealth, then silver will show value.

Metals have not shown their true worth for many years as the world has done very well. This is very good. But, all things do change! As it is our time and place to live this change, our thoughts must view the future as it must be. Who can know the minds of men and countries as paper burns?

Date: Fri Jan 23 1998 20:16


Date: Fri Jan 23 1998 19:35
A.Goose ( ) ID#20137:
Date: Fri Jan 23 1998 19:26

Mr. A.Goose,
In our present system, all currencies are backed by the US$. As long as the US$ is on an "oil standard" of backing, no other country can change. The BIS would destroy their economy in a second of storm. Many think that a country may sell or cut it's CB/US debt backing at will! They cannot, they will not! Oil will not accept another system as long as the oil/gold bond works and the world currency system is somewhat in order. If a crisis erupts and gold breaks the bond with oil, then a change must take place!

We will no doubt see a mass run of CBs into gold at ANY price! This I know! As for now, each person must protect worth, as the nation/state is locked from change.

Date: Fri Jan 23 1998 20:38


Date: Fri Jan 23 1998 20:17
oris ( ANOTHER ) ID#238422:
Thank you for your reply.

The world oil market is very, very hard to understand.

If I could speak in a future time on this? I must be gone now for some time. Know this, my knowledge of gold is for the simple ones, of small thought, such as I. Resist the traders mind, hold your wealth close. There are those that will take your worth at the very time you need it most. Most will not see the time or place, few are allowed!

thank you

Date: Wed Feb 04 1998 18:47

Consider, can they all buy silver?

The most important thing to observe is that Mr. Buffett did NOT use any form of paper to represent his silver. No options on silver, no futures, no options on silver futures, no silver mining stocks, no leased silver deals from mining stocks and no MARGIN! Most of the large buyers of metals are buying the physical, outright. Mr. Buffett had Berkshire

Hathaway purchase silver as part of it's long term "economic investment outlook". Not to be confused with a leveraged, quick profits bet. Understand, that Berkshire plays within the "world paper economy parameters", they are not looking for a currency replacement. What is not seen, are the personal holdings of Mr. Buffett, Mr. Soros and countless other "world wealthy". In those accounts you will indeed find silver, but also, much more gold!

Note, that he was buying thru much of last year. So were a number of others. The one common thought from them all is that, "the real wealth will be held in PHYSICAL form"!

"you may also follow in the footsteps of giants"

Date: Wed Feb 04 1998 19:37

Mr. H. Hitter,
Timing? Most of the very large buyers completed much of their conversion all of last year. When we speak of these entities one must know that they purchase much larger amounts than Berkshire. Most cannot understand that it is difficult to take five or ten million oz./gold in physical in a month or less. Note that Mr. Buffett has taken six months and only purchased about half of his silver! Even here we speak of only $300m for the amount taken. At this time the market is very, very tight for large money to go into physical. Paper, yes! I could move five billion US into paper metal very fast, but not physical.

Is silver being played to ignite ? Only the small paper movers are trying for the "fast buck squeeze". Most of them get eaten when the lions come for food. The big wealth is only trying to convert! Silver is good, but always to small. Perhaps at $150us it would work? Most are looking for a "currency/wealth" holding with history! They, ( this includes some CBs ) want a holding that is spread far and wide, and very deep! Gold is good.

Date: Wed Feb 04 1998 20:24

What are your "THOUGHTS" regarding the major currencies being backed by PM's?

Mr. Junior,
Any nation/state can put it's economy/currency on a gold standard. They only have two requirements. Own a stockpile of gold and raise the price very high!

In the past, when currencies were gold, a nation could not lower the amount of gold backing it's currency ( raise the price of gold ) because it lowered the currency unit worldwide and created payment imbalances. Today, no nation/currency is on a gold standard. The first country that starts will own the rest for some time.

Find me a country with many needed resources, little debt in relation to the assets and a national pride to lead? Let them price gold at many thousands not only in their currency but also in their resources! The world would buy from them, cheaply in gold but dearly in all other unbacked currencies. The markets would do the rest!

The large modern currencies, of today have only debt ridden economies to back them. They cannot change as debt blocks their path. "To change is to live and to live, some debts must die". The owners of much of this debt must lose if change is to occur. Even the new EURO will not be backed by gold! It will HOLD gold only as insurance against the worst outcome, war.

Yes, an oil state comes to mind! It could even be China!

Date: Wed Feb 04 1998 21:02

Mr. Kiwi,
Will the paper market ever represent the physical?...

You will see it in out time!

Will a total collapse be necessary first?

Perhaps a "almost total"??

It seems the vested interests in the paper game are powerful enough to

keep the physical down indefinitely?

In a very real sence, games can go on forever. The question here is;

Can those powerful thru "paper wealth" go on indefinitely? History has shown that they end suddenly, with great puzzlement as to the loss of importance without wealth.

Date: Wed Feb 04 1998 23:23


Mr. Studio. R.,
Will several ( or many ) bullion banks fail?

"when one cannot repay a loan, it is done" !

Are the bullion banks bonded?...

In the real national/ world there is no such thing as "bonded".

Look to Korea for proof!

Mr. Sweat,
If oil or the BIS bid for gold, you will know it ! In your terms,

" up front and personal"??

RBA's 167 tonnes ? No comment.

Mr. Kuston,
Please understand, that wealth will move into all forms of real assets as the destruction of our debt/ digitial currency system continues. When the currencies move to a final resolution, it will be the "marketplace for precious metals" that will die first! It is well known that gold will hold it's value above everything. All other metals could lose much of the value they gained prior to this meltdown! Remember, "when the currencies go to nuclear war, all paper and paper markets will burn"! Many hard assets will lose in the public mind as confusion will rule. In the thoughts of many, gold will perform!

Date: Wed Feb 04 1998 23:39

Mr. A. Goose,

Davos ? Watch what Mr. Munk of ABX does with his paper gold. A move to copy WB, but buying physical gold for his personal account would not be of supprise! The CBs have stopped selling/leasing and that has put the entire world of LBMA "at risk". ABX is of that world.

Date: Thu Feb 05 1998 00:09

Mr. Aurator,
As in my 23:23 post, I cannot comment on this.

167 tonnes ?

Date: Thu Feb 05 1998 00:16

WetGold and JTF,
I will reply on the 07th .

Date: Sat Feb 07 1998 18:45

Some see metals from a view of only "supply and demand". Supply must be put for use and real demand must consume to produce a product. It is not this way with all things! If a person holds gold, must that holding is viewed with the one purpose, to sell some day for profit or loss. It is for some minds that gold in both hands can have no use? Such a mind can only see value in paper terms. For such thought finds gold as wealth, only if it is someday turned back to paper! Paper, indeed! A dangerous position to hold for the future in our lives!

Brokers and traders will show you, "turn your gold into wealth", "put it to productive use, Trade It"! "Sell your gold and buy it again, many times". "Do this and find the value lost from your youth"!

But I say, spend your time in the company of truly wealthy ones, see how they make gold lie very still! Know this now, the world will again, in your time, feel value in gold as never before. And that value will be as the "productive use of holding wealth thru the fire of change". "Yes, you can also walk in the footsteps of giants".

Think now in light of the real world around us. Hold your assets in the sun of day, what do we see? A government bond denominated in a currency? Now, remove the currency from the bond, show what is in your hand? Hear me now, we see nothing of "productive use"! Yes, there is supply of the currency, and we have demand for the currency, but the end product is as the space between stars! Even in this "light of day" a trader/ government will tell you, "hold not that commodity, gold, for it is as a dead, unproductive asset". I say, run from these lies, for they see not deep in the future!

Is this not true? I an slow, but many think for me. Read please:

"Noone can see the value of a real asset when knowing how many currency units it is denominated in. Value is only known when holding one real asset next to another real asset and comparing the currency unit valuations of both. Use as an example, a $75,000 $US Mercedes and a small apartment, also $75,000. They can be traded using the currency as a temporary holding until the transaction is complete. The car and apartment are viewed as having productive use of equal value. However, it is the items that have the value, not the currency unit! The currency is of but momentary value expressed as "the intention of a trade completion". Complete the trade and "poof" the units hold no future value. At this point in time, everything in the world is "denominated" in currencies that have no use, except to complete the trade! Trillions upon trillions of digitized currency are currently being held for the "completion of commerce", extending out into other lifetimes! Of course we are speaking of any form of currency denominated debt, be it government or private.

The major threat to this collection of wealth holdings would be the introduction of any real asset currency. Any country that could "resource a currency" of use the world over does pose a threat to the wealth of nations greater then war! It is in the realm of possibilities, that a gold or oil based system would bring a resolution to the present structure as equal to " a nuclear war of currencies". Our concept of value, would indeed have to start over. "

Mr. Cjs1, To say "this is good" or "your view is a good one" in my world, is to say "I agree" in your world. "good thoughts flow as cool water for a thirsty mind"


Date: Thu Feb 05 1998 00:01
JTF ( Peter Munk, ABX, and LBMA ) ID#57232:
Another: Could you tell us more about what Peter Munk may have done?

Mr. JTF,
ABX is in debt for gold. They owe not currency but gold. They are a paper company operating in a paper world. No government will allow any entity to sell gold for thousands an ounce when debts by that country go unpaid. Especially when the paper that represents the gold that is owed by a miner, is held by some who gain thru the loss to the all. In that time, gold will have a far better use. Remember, "gold and oil will ever flow in the same direction"


Date: Wed Feb 04 1998 23:52
WetGold ( ANOTHER ) ID#243180:

Without speaking in parable ?

Buy physical gold and hold it close. Real wealth can not know time, it is good for all seasons. It will buy you honor during a time without truth!

I will return in a time.

Date: Sat Feb 07 1998 20:51

In addition to this "What is the catalyst for the coming event and when will it happen ?"

Mr. WetGold,
One fine day, life in your world will change. The newspaper will show what has happened. In that day the price of oil will rise to, prehaps well over $100/bl if purchased with US$ alone. It will cost , perhaps $8.00/bl if purchased with an additional, tiny amount of gold. Perhaps, in a time before 2000, a new oil currency will be born! In that day, debts will burn and currencies will war, and you sir will, with honor, raise your standard of living with Gold!

Date: Sat Feb 07 1998 23:22


Date: Sat Feb 07 1998 20:00
Forklift ( Another ) ID#156161:
What country would have the brilliant wisdom and daring to make gold it's currency and thus own the world? What new regional entity, yet to form, could accomplish this?

Mr. Forklift,
Your eyes are, no doubt more clear than mine. Stand here with me as we view this race of two! As in all things, it is a game for some and to others it be life and death. I would say, stop this effort, but it is late in history. So, make ready, as we will be here for the finish!

Date: Sun Feb 08 1998 09:51

Date: Sun Feb 08 1998 08:50
CJS1__A ( Replies ) ID#329157:

I would say you have chosen well! Over many seasons, the currencies have come to bid in this race and all were found as "low bid". The time for "full production" is at hand. No currency is large enough for this race, so a new one will arrive from the past!

This you say: An alligator is, they say, "all mouth and no ears".

This is good, I show a great smile!

Mr. Pete,
I have written of this. See the list from Mr. Fin. Try using $30,000/gold, the value is better for all!

Date: Sun Feb 08 1998 10:17


Date: Sun Feb 08 1998 09:42
Forklift ( CJS1__A ) ID#156161:
"it is also something of great value which they cannot defend"

Mr. Forklift,
You must place yourself in that time! Nations with gold and armies will stand for Arabia! $8.00us/bl oil is indeed a resource to fight for!

Date: Sun Feb 08 1998 10:31

Date: Sat Feb 07 1998 21:28
refer ( ANOTHER @ THOUGHTS ) ID#41229:
Is your warnings to us of something that may happen?, something you feel will happen?, or something that is in progress and you know will happen?

Mr. refer,
I submit to you that, thruout time the progress of men does proceed at many speeds. I do offer my thoughts on a direction that is taken for a chosen time. But, who can know the minds of builders? Of my life and times, I do say, this structure will be completed of the well being of all! For this new system to fail, it will be as Mr. Donald has said, with much destruction of commerce.

Date: Sun Feb 08 1998 10:45


Date: Sun Feb 08 1998 10:24
WetGold ( ANOTHER ) ID#243180:
Since Arabia will be protected AND the U.S. has a strong allie in Arabia ---
Will the relationship sour or will be united with a common goal ?

Please see Another's post from yesterday AM and on. You and all western minds must weight this offer as it is heavy for your side! A great many losses will be for the holders of debt and paper things, but the gains are for a better life. There will be many for NO! Time will prove all things!

Date: Sun Feb 08 1998 11:01

I will be gone for some time.

Date: Sat Feb 14 1998 19:10

I would say, you are thinking well with this thought:

Date: Mon Feb 09 1998 18:20
SDRer__A ID#288156:
"derivatives EXIST because the system is broken"

To this I would add:
" a broken system EXIST because oil still backs the US$"

It is good, this system, for the world economy is strong from the easy flow of oil. But, the economy is as living persons, and subject to the stress of real life! We do now reach high production of goods and service worldwide. But, in terms of our financial system, the ability to trade these goods, has reached it's limit! Even as a mountain climber, humans have limits, as we can move only "so high" and "so fast" at this altitude. Today, the derivatives start to fail because the world trading system is slowing down, even as products are produced faster and cheaper. The economy has reached "the top of the mountain" and noone can see this.

As you read this, persons buy companies thru your Dow Jones at values that reflect "the supply of cheap oil" and it's good effects for business in general. What they do not see is the undoing of the currency world that "good business" must have to operate. The "oil standard" created and held this currency world intact, thru much abuse. Today, the "derivatives", that require a long future of "good business", are being "devalued"! Look far and wide as you are, now , at the top of this hill! The world will head down this slope because it is not a machine and is subject to "thin air".

History has shown that as persons slip from a high stance, they grasp for items that are known to be secure! They do reach for real things! Derivatives offer not a solid hold. It is well known that the modern gold market is fat with contracts derived from "intentions to supply". It is also known that the US$ continues on the "oil standard" because of this paper. No doubt, oil will continue to flow, but what currency will take this supply as we "walk down the mountain"?

In that day, "good money" will become "bad money" and "derivatives" will be paid to the holders of "derivatives"! In that day, a gold mine will also be paid in "derivatives", for it's gold will be for the benefit of all.

This is the way for you to see this modern gold market:

"Today, the paper gold market only affects the physical as the price is pushed down! It is the physical market that destroys the paper gold as price rises. In a falling market, paper can be settled in physical gold or cash! In a limit up market, paper can only be settled in more paper or cash!"

It is of this knowledge that wealthy ones and some CBs are taking in physical gold.

Look to LBMA, for currency looking for gold! Compare the Comex average open interest with it's average daily trading volume. Now use average daily trading volume at LBMA and convert to open interest in London, using comex ratio. Here you will find "real currency" in "paid for" gold derivatives ( not futures ) ! This money is now looking to convert to physical! It is caught in this paper with no way out! Know that this amount covers not CB gold moved by big trader! That wealth is safe, as it is for the good of all in those countries!

Mr. Bart,
Your fee, it is a good thing. I would be more open and bring the thoughts of others for all to see. " all persons live for as one world and secrets are for the fools"

Date: Sat Feb 14 1998 20:18


Date: Sat Feb 14 1998 19:34
Preacher ( ANOTHER; A Question ) ID#225273:
"free flow of oil is more important than the Pacific economies. Could you explain your view on that more clearly? "

Mr. Preacher,
A time ago, the Asians were buying great amounts of gold thru South Africa. This alone was enough to drive the price of physical very high. As cheap oil required low gold, this action was, not good. In addition, during this time, a person in Hong Kong was moving many wealths into much "paper gold" in London. The amount "leveraged" was so large, in physical terms, that delivery would not happen, as no CB would sell that much. This gold paper was purchased from $365 down with intent to buy all at production cost ( below $300US ) . Much of this paper was converted, but London had to sell so much new volume that it changed the paper market, forever! That is why the CB had been seen as selling to honor this paper. The BIS stopped the CB sales and drove physical gold from Asia as a last resort! Oil has locked the CB and IMF gold from sales of significance. What metal that trades worldwide, is all there is.

Perhaps, this has answered your first question, also. WW3? Wars are fought over oil, not gold!

thank you.

Date: Sat Feb 14 1998 20:50


Date: Sat Feb 14 1998 19:58
Heavy Hitter ( ANOTHER ) ID#403159:
"but maybe you have a hunch?"

Mr. Hitter,
The price of "hunch" is very to high for investment! It is the reason so many paper gold buyers take on appearance of " to much sun"! I offer this, do not use the solid reasons for owning physical gold, as a purpose to trade it. Your profits from such trade, will, on the last day, in the heat of fire, burn as paper does! Sir, the world is going to change, and the rules of engagement will also change. Gold will be repriced, once! It will be enough for your time of life.

Date: Sat Feb 14 1998 21:32


Date: Sat Feb 14 1998 20:00
WetGold ( ANOTHER ) ID#243180:
This appears to be a monumental world crisis much worse than the depression of the early 20th century. Could U expand further ?

Mr. WetGold,
In the past, nations and states have lost all as " the world changed" and these entities lost the ability to trade, at a profit. It is as history, and happened many times. Today, it is not the same. The "wealth of nations" are held as "thoughts of value" not real value! And even these thoughts are "in debt" as they are owed to other nations. As it has always been, time moves the minds of people to change, and with this, the thoughts of value also change. In this day, as not in the past, the loss of paper value as a concept will destroy the very foundation of wealth that this economic system is built on. This drama has started and is well underway!

There are nations that will try to "resource a new currency" as the old financial system implodes. Oil or gold or both may be used. If it is done at the correct time, much will be gained by all! Fail this Attempt, and gold will never trade on an open exchange again, in our lifetime! We will see this end in our time.

thank you.

Date: Sat Feb 14 1998 22:22


Date: Sat Feb 14 1998 21:01
Preacher ( ANOTHER & Interest rates ) ID#225273:
"Thank you for that answer. Perhaps I'm dense, but I'm still not clear on how driving the gold from the HK traders collapsed the Pacific economies" ?

These Pacific economies were "on the edge" for some time, that is why many peoples there were buying gold. As the financial systems approached resolution, " the OPPORTUNITY was observed" to allow the currencies to plunge, without help! Much gold ( not all ) was driven from the Pacific rim, and the buying has slowed much. Many underestimate the need to keep gold in the low $300US.

" Also, you are looking for lower short-term interest rates, but skyrocketing long-term rates along with a higher US$"?


In an effort to maintain the dollar/oil bond. It is well to know that oil holds not long term US debt as backing for it's currency. In the end the CBs will let the long bond plunge in price. That is why most of the US debt is not "long", this change is for that time.

Date: Sat Feb 14 1998 22:29

Date: Sat Feb 14 1998 21:21
WetGold ( ANOTHER ) ID#243180:
" How do Muslims in the Middle East and around the world reconcile this in their pursuit of GOLD with the "New Paradigm" ?

Sir, I do not know.

Date: Sat Feb 14 1998 22:51

Date: Sat Feb 14 1998 21:22
Goldhawk ( Another Excuse my brashness ) ID#433286:
" Just curious"?

Mr. Goldhawk,
Your life and times, it would fill a book I would read with much thought and intent! My book would be thin as compared to this history of gold. Together, we will read this book of gold and live it's modern life. It is the truth of this life of gold that pulls our minds to gain knowledge, not my life.

Mr. Pete, another time, thank you

I will be gone for a time.

Date: Mon Feb 16 1998 14:40

We will have a "change of events", please read,

"The Time Is Right For A CHANGE OF EVENTS"!

They traveled a long road to get here. Back in the early 70's they ran out of gold after printing too many dollar commitments. If they couldn't use gold anymore, what else could be used? You know and I know that the buck would have been dumped real fast without something behind it! All the talk back then and now, "everybody's gona hold the greenback because of the USA economy and it's military might", yea, right. Didn't see any coverage on the TV, showing the behind the door financial rooms. Truth was, everybody was going to move straight to the hard currencies and gold! Dam the effects on the world economy, figure that out later.

But, look here, the oil states said, "we will settle all oil payments in US$" ! Buy the oil in any currency and rate, but when you make the check, dollars please. The US agreed to float gold up to $250 if they went along. At that time, oil agreed because they held a hunk of gold in the NY fed bank valts. Looking at it back then, 250 looked to cover anything! Well , anything happened and the Carter had to slam gold in 78 when it crossed 250! Guess the US thought oil would just stop buying gold with excess cash, per the "agreement back in 71". Anyway, the rest is history through the 80's. Everybody learned to "love the dollar and hate the Russians"!

Everything changed in a hurry during Desert Storm. Remember how gold got hammered, big time! War in the oil fields and gold down? Looked good on the TV news, "America is winning, the dollar is good" Gold? No need! Here's what really happened.

In a very real way, the US dollar was inflated so much that even oil couldn't back it! Yes! The US ran through the gold backing in the 70's then went to a much larger oil backing in the 80's. But, even oil couldn't contain the huge expansion of dollar commitments that were created by the early 90's. Back to the drawing board. This time the US had to add gold to the oil backing mix, if the dollar was to remain on top!

A little political thought first, then we continue.:

Do you really think the US is the only country that will stand a military in the oil fields? What if they told the US, NO, we want someone else to defend us? You think there are no other takers? The truth is, everyone is lined up to offer defense. The price of "oil backing the defenders currency" is worth almost anything! All the deficit spending you want, goes to the defender! Even Russia, if you can believe it! As my friend would say, "you think long and hard on this"!

Now, back to gold. The deal: you may stand your army for us, in return, " oil will back the dollar, if the dollar is made strong by gold" "in as much as our people may replace the lost value of oil with gold" "in as much as we will produce oil in amounts to equate a gold/oil/dollar ratio close to that which existed at out previous agreement in the 70's" And, pray tell, how does the USA make the dollar strong in gold ? The BIS leads the creation of a paper gold market that will lower the world price of gold to the extent that it remains above "production costs".

Guess what, it worked! Contrary to all expectations of oil shortages, inflation, debt collapse and what have you, It Worked! But, there is one small problem?

The BIS and other various governments that developed this trade ( notice I didn't use conspiracy as it was good business, as the world gained a lot ) , thought that the paper gold forward market would have allowed the gold industry to expand production some five times over! Don't ask where they got this, as they are the same people that bring us government finance and such. But, without a major increase in gold supply, the paper created by this "gold control operation" will either be paid by, 1. new supply. 2. the central banks. 3. rollover existing. 4. cash? 5. or total default! As the Asians started buying up everything last year ( 97 ) , number 5 and 5 started looking like the answer! When the CBs started selling into this black hole of demand, the discussion of #5 started in their rooms also.

What is really interesting is how gold is being viewed and traded in some areas. Some people are using it's future "reset price, in terms of oil" as a value discount. In other words, they use paper gold to buy things based on the new oil/gold relationship perceived as a given in two years or less! It is assumed that this proportion of paper gold held by oil, will be converted, no matter what? We are talking, many thousands an ounce here!

So where are we now? I'm' not sure! How much gold paper is out there? If you look at the comex ratio of average daily volume to open interest, it's sometimes around 8. Funny thing that ratio is close to the gold commitments traded in London. Multiply, say 40 million ozs by the ratio of 8 and we get 320,000,000 ozs. of gold. Now, the money is in this gold paper, paid up. Just no gold yet, I think? That's about 10 tons, I'll be dam! That's a lot of IOU gold, don't you think? Add to this, that between the IMF and what CBs could sell, only about 1/3 of it is available at a much higher price, if at all! Then again, I'm not in any position to know this, am I?

Wonder if anybody else knows or thinks this? Sure could mess up a sweet deal for the world economy. Does anybody have a plan, a currency plan, if things change? But, then again, just like in the early 70s, nothing changes. Does it?

Date: Mon Feb 16 1998 19:39


Date: Mon Feb 16 1998 18:09
STUDIO.R ( @Obsidian.... ) ID#93232:
I believe that the estimate should have read 10,000 Tons=sold position.

Thank you,

My good friend did not place three 0s. My thoughts come thru one computer, but move far thru time and ones in line. I will return.

Date: Mon Feb 16 1998 20:51


Date: Mon Feb 16 1998 20:19
mozel ( @ Silverbaron ) ID#153102:

Mr. Mozel,
Thru these "thoughts" I have made effort for many months, in haste, to make clear. My words are plain, but hard, and others have presented this truth in a western way. But, you sir, have made the best of it!

"make your path through the darkness, despair not, for one with direction and purpose, will read the map and complete the journey"

I make clear for you to lead!

thank you

Date: Sat Feb 21 1998 23:47

A CB lends gold at 2% to a producer for a better purpose than make money on idle asset. This gold loan is now the gold asset with a mine behind it! Such assets are traded and create solid paper for oil. If reason for good return was real, it would look like below. Read ABX page and consider, please.

There is much with this question!

Why doesn't a CB enter into a "reverse spot deferred gold contract" from the same Bullion Banks it lends gold to? Conditions:

1. CB lends gold at 2% to the Bullion Bank.

2. The Bullion Bank sells the gold at $300US.

3. The BB earns interest on the proceeds.

4. One year later, if gold is below $300, the BB buys in the gold and the CB gets it's gold back plus the contango.

5. OR, if gold is above $300, the CB invokes the "spot deferred" clause and lends more gold at $300+ to the BB. The first deal is deferred until another time as intrest builds.

6. In this process the CB will bypass the gold companies and gain more return.

Read the ABX hedging page, we discuss at another time!

Date: Sun Feb 22 1998 20:13

It is written that "A voice that is true has many minds for reproof, but one tongue can never be as the same thought with all men ". I say, "draw from these words what you have not and make use as your past will allow".

How can one know value in currency, when paper does not lie still? It moves at night, where noone can see, and this we hold to prove out worth? Real things know not this paper value, for they hold tight in the earth. In this time, we do stand firm with value and watch as "thoughts of others change in the wind"!

The modern currency price of oil and gold does not show the "risk" of a paper storm. It offers "no sign" for the weather ahead! Today, some see the value of oil as true, thru gold. But "risk" comes not in currency inflation by price of things, but in currency destruction thru "choice of use"! Find "one nation for gold" and "all thoughts will move as one". For as persons need real things for life, they do "want" and "reach" for a "real measure for worth". Not one by concept, but as "true from the past".

All persons hold wealth as never before, but search in vain for "this measure", one that "blows not in the wind of thought". For the good of all, this search does end, but brings with it the storm of change! The trust of old values will break in this new wind. Hold your worth firm on the ground as no storm will move a true value with weight, a weight for the winds of this season, gold!

It is a poor reason and purpose, that a CB lends gold for 2%! A simple farmer is better not to plant, as a harvest of grain for 2% is as a wage below life itself! Know they do this for a higher reach, as the gain is not for the return of metal, but it's use in trade. As in all things, the world does change and this purpose of CBs is now of the past. A "Desert Storm" offered birth for this new "paper oil currency" and a "currency storm" will now bring it's change. As a "currency of gold" springs from this wind, western trading in this metal will end. The "terms" of all currencies will change as the "use" of these moneys is changed. Many will now know true worth as the "terms" of every asset does find a "real price" and a "real value" in the "true world of things". For the future of most, "the wealth that was shown in paper" will be seen as clouds in the sky!

Thank You

Date: Sun Feb 22 1998 20:38


Date: Sun Feb 22 1998 20:29
Heavy Hitter ( ANOTHER ) ID#403159:

Mr. Hitter,
I must wait to answer all questions! I will save and reply, as much is in "progress" as we speak!

Thank you

Date: Tue Feb 24 1998 19:14

Many ask, "why does gold act in this way"? I say, "it is not the gold market of your past"! Tonight, I will have one bring you "the ways" of my thoughts. It be in a clear tongue for you.

For most of you, your time is very expensive, but still, I ask you to read this as "it may be worth your time"! I say this now in light of posts from JTF 13:14, ALLEN 13:00 AND SDR 12:10.

If not to transmit, then the next day. Tonight, if yes!

Date: Tue Feb 24 1998 21:46

One of my favorite sayings comes from Another, "this thing of life, it is a hard game we play, yes?". It does seem to cover all the emotions, I use it often.

But, this game of gold, it is not only hard, but will cost anyone dearly if they try it without all the facts! Do we have the facts, or is this really just a game? I think, for many investors, the precious metals have become a game of such, even "a gamble that they never intended to take". Conservative persons, trying to protect a life's savings entered this arena with a clear direction, that of protecting their assets from uncertainty. Far too few made it to this end. They read the numerous gold books and newsletters from the last 20 years and came to a solid conviction that, "I can make a fortune at this" or "at least a small killing"!

The gold market is made up of a very broad spectrum of investors. At the very farthest ends of this spectrum lie the persons with the largest influence on the physical bullion. The super wealthy at one end and the "third world no ones" at the other. The middle is occupied, mostly, by the "investors with western thought". The far ends buy bullion. And they don't buy it as a gamble or a game! It is a way of life that has worked, through thick and thin, even before the West was "The West".

Now, on the other hand, this "modern day middle of the spectrum"! Well, they have read why we need gold, but they have never "Experienced" the need for gold! Until that day, when they gain "Experience", most of them will make "A Gamble That They Never Intended To Take". Yes, they do invest in all forms of paper and or leveraged gold and all the while, expounding from the roof tops the coming currency crashes and stock market declines. Even looking for bank closures and bank runs, as they cling dearly to comex options and gold stocks!

Anyone, from the outside looking in can clearly see that "westerners" do lack "experience". What does this have to do with the current market? Let's move on.

As Another has said, "this market is like none before". That is so, very, true. There is a "flaw" in this modern market that many do not quite grasp. In time, they will! There have always been people and companies that make a living dealing in gold. It is an ages old business. Today, we see a phenomenon that is "as none before". It is mostly done by the investors at the middle of the spectrum. The "trading of gold" has grown to a level never seen in history! You read every day, that no one wants or needs gold! In a way those statements are very correct! No investor wants to hold gold, but everyone and his brother ( and sister ) want to trade it! The volume of paper trading, worldwide, on and off market is beyond belief! It has created a type of "Parallel Paper Gold Universe", existing side by side with the physical. The major "flaw" in this system is found in the makeup of the "traders" of this "paper gold universe". Without fail, the majority is made up by those in the "middle of the spectrum", those without "loss of currency "Experience" ". Mostly, they are of "western thought".

Without the experience of " the destruction of currency" as a mental control, the "paper gold universe" will expand! I will not begin to list the types of paper gold available for trade, but from comex gold options to huge corporate derivatives, the overriding motive with gold is clear. "I will trade gold, up or down and make currency on it"!

Ladies and gentlemen, today, the paper gold market is larger than available, tradable physical gold, by a factor of three! This market will continue to expand until we reach a massive gold derivatives failure. This will come about as those, who had no wish to gamble, but traded paper gold anyway, make a mad rush to dump paper and buy gold. Very, very few of them will succeed! You see, the largest bulk of the tradable physical gold will never come back into the market, "in terms of currency"! It will return as a trade for "another commodity"! OIL!

What do we look for to see the coming end of this present overleveraged economic system? The complete and total destruction of the world gold trading system!

From Another: " the destruction of the present currency system will be preceded by the total unlinking of all gold for currency trading" "gold may find a price of $50US/oz or $50,000us/oz, but the truth will not be known as an open market" " yet gold will find an increase of value of biblical proportions"

Thank You

Date: Tue Feb 24 1998 22:38

Some Replies:
I will answer as seen, as time is short.

Lending slowed the end of last year. Some sales still ongoing. CBs wanted gold to stop in the low $300s as that priced $12 to $15 oil. The paper market is now out of control. The BIS will step in at below $280. They have currency as "trees in the forest without limit". But, the gulf problem may change things. This is ongoing?

Silverbaron ,
you know what to do. Physical gold will serve all, very well.

each person must sail their own ship. My allocation, is not your allocation, plan as your thoughts will allow.

Date: Tue Feb 24 1998 22:46

Date: Tue Feb 24 1998 22:28
Isure ( @ Another & All ) ID#368244:

My gold is for my family and country and my thoughts, are as free like the wind.

Date: Sat Feb 28 1998 16:33

A question from the far past by Mr. JTF: " what is ANOTHER really alluding to?

I have tried to offer these thoughts as a way for many to understand why this modern gold market is not as before. Most of these letters apply to investors at the far two ends of the market ( see my last post by another ) . Many, from other places, do understand these "expressions" as given. For many here, I resist the replies to questions that offer results for "gold traders". The intents and reasons are for persons to "consider" and "see" this market in a true light for today. Not for paper trades that will lead to certain loss for the future. I now believe, that by way of other posters, these thoughts are "in grasp" by many traders of "western thought". One may not "accept" the conclusions, but they can, "mentally experience the outcome" of the future. For this end I will now offer real direction. That of Why, When and How Much! I do this for those of "Family and Country", and persons of Honor. Those that live to help, not take, in times of change! Some say this knowledge should not be in a "public way", but I say secrets are for fools.

The next post will show some letters by Mr. Allen ( USA ) and M. Mozel. These best expound my way for your reason. It will be as "the end" of past thinking. For the time in the future, directly ahead, all will receive thoughts of Now and Tomorrow! For those of simple thought, such as I, the knowledge of the past, when brought forward into the future, will be, "worth your time and consideration"!

I will be gone for a time,

Thank You

ANOTHER (THOUGHTS!) Continued...

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Oct '97 - Nov '97

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Mar '98 - Apr '98

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May '98 - Sep '98

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