Thai Guru's Gold und Silber ... (Informationen und Vermutungen)

John Embry’s latest is another outstanding effort:

http://www.sprottassetmanageme…nvestorsdigestjan0105.pdf

***

Bill,
Happy New Year! I feel like a Timex watch after checking Au's price this morning — still ticking in spite of it all. I get the feeling the HUI must be awfully sold out to not budge more than it did.

I wonder how Asian demand held up today after the disaster. I read that Madras was hard hit and Asian commerce must have been generally disrupted. I hope that those of us on this side of the world reflect on our good fortune to have been spared. The San Andreas holds the same kind of power and there is geological evidence that the region where Seattle now sits has been hit by similar Tsunamis in the last few centuries.

Anyway, keep up the great coverage and the criticism of the Vichy's of the gold world — the WGC, GLD and most resource company management.

I will remember 2004 as a see-saw year in which the Cartel huffed and puffed but was ultimately limited by how much physical gold they could put on the table. 2005 will hopefully see the noose drawn much tighter on their scam.

best wishes for a great '05,
Peter R.

Considering the battering gold and silver took on the Comex, the action in the shares was constructive. More and more it appears they are sold out. The XAU only lost .43 to 98.93 and the HUI only gave up 1.81 to 215.81. Whenever the HUI smells the 213 level, it tends to turn up its nose and reverse course.
Of course, with gold at $435, many of these shares are ridiculously cheap. A number are selling at half the price they were with gold at $424 a little over a year ago. Time to be running for the buying hills, not from them.

GATA BE IN IT TO WIN IT!

MIDAS

Bill:
Here’s a little New Year’s "cadeaux" for you and the GATA gang.
Best regards,
Dean Steeves

TO ALL INTERNATIONAL BANKERS

The pages of your history
Go back to far in time
So I'll just deal with what you've done
To this country I call mine.

Shortly after settling down
From our constitutional stir
The richest land in all the world
Is simply what we were
And the control and depletion of all this wealth
Is what you deeply yearned
So off you went just
Like you did in Europe
Since the days of monarchies
To establish a form of central bank
That would control all financial decrees.

At first our inherent strength
Made it tough for you to play
But slowly over the course of time
You had more and more to say
Until finally
On one December day
Our own Woodrow Wilson
Signed our country away.

Yes your Federal Reserve
A private corporation
Not an agency of our government per se
Spread its' wings
Took to flight
And converted both our lands and ourselves
To your financial prey.

You created our crash of twenty-nine
And our bankruptcy of thirty-three
You hold all our federal lands as collateral
As part of our receivership
To which our Congress agreed.

You have fraudulently created the IRS
As part of your depletion scheme
You have pursued with a vengeance our farm lands
Because you know they're our bastion
For maintaining our independency.

You have created dissension
Poverty and crime
So that your New World Order
Will appear like relief
Just sent in time.

You own most of our Congress
with all its political jive
Our media
Our education
Our judicial
Our religions on high
You have no intent of stopping
The people's painful cries
And your only response is
"There will be no relief
Until it's all our own way,
Or until all of you die".

And you assume we possess
Only marshmallow hearts
And drugstore lettuce eyes
Well what can I tell you
About how far you are wrong
Because your money's not the power
That thinking is wrong
At best it's a lever
That doesn't have long
Since the fiddler is now playing
Your final swan song.

You have made the worst kind of error
In your assent to the throne
You have assumed we were all helpless
Against the weapons you've honed
You thought you were concealed
Pulling strings from behind
You obviously must think
That everyone's blind.

You operate through channels strategically placed
You'll even set up a counter against yourself,
If it means hiding your face
Your team of assassins
That work your international affairs
Are now being supported by soldiers
Wearing United Nations' gear.

Your man Mr. Bush up there on the hill
Has certainly proved to us all
That he's ready and willing to kill
Because the slaughter of our freedom
Has been a reality pill
That says if your plan doesn't get enacted
Then the Multi Jurisdictional Task Force
Through FEMA sure will.

I could go on and on
In exposing your plan
Of world domination
Of slavery and scam
But suffice me to say
And I'll speak as one man
THERE'S NO WAY IN HELL
WE'LL EVER GIVE UP THIS LAND!

December 30 – Gold $437.10 up $1.60 – Silver $6.79 up 2 cents

Super Explosive Silver / 2005 To Be A Great One For Gold And The Shares

Too often we enjoy the comfort of opinion without the discomfort of thought... John F. Kennedy, 35th US president (1917-1963)

GO GATA!!!

At least we end the year with some smiles. Gold followed through on the downside after yesterday’s mugging by the crooks – the ones who broke the US anti-trust laws via their collusive selling. Anyone who has ever doubted GATA’s claims will only have to "go to the videotape" as sportscaster Warner Wolf said so often. Gold was clobbered by Goldman, Deutsche Bank and JP Morgan Chase for no apparent reason except for the orchestrated desire of these white collar thugs to, in collusive fashion, bring the price down.

However, for the 4th time this month the low $430’s checked the sell-off and gold rebounded. Today’s $433.30 low (5th time it held) was just above yesterday’s $433. Buyers, seeing this significant support level hold again, were then eager to step up to the plate.

The gold correction camp, so prevalent at the New Orleans Investment Conference, has not been right for one day. All that has occurred since then is two run-ups to $455 and then $445 with subsequent moves back to the price levels prevalent during the conference.

Perhaps the correction camp will be right in the end. What is comforting for those of us who believe the low $430 area will hold, and that gold will make new highs, is the correction camp is the one with all the company. There have been very few short-term bulls out there for a couple of months now. Little has changed as we head into 2005.

Two additional comments on yesterday’s flagrant manipulation of the gold price:

*Gold fell $11 at one point. Once again we see how The Gold Cartel allows gold to free-fall when it wishes to push the price down. However, on the upside gold is contained by their $6 Rule. You would think after years of watching this price "phenomenon," the ninnies in the mainstream gold world might take notice and comment on the fact something is not right. Nope, not these banana heads.

*During December I made mention of a number of small gaps gold left on the downside. Yesterday’s debacle took care of them – all filled. Now gold can move higher to fill the BIG ONE left below $450.

All year long the pundits commented on gold’s rally in relationship to the euro’s rally. As we close out the year, we see how this relationship became unhinged courtesy of the blatant manipulation of The Gold Cartel. As today wore on the euro continued to strengthen, making all-time highs and touching off stops at one point. Eventually it settled back a bit, yet still managed an all-time new high close at 136.46, up .50. The dollar closed in new low ground at 80.60, down .50 while the yen finished at 102.99. Yet gold is wobbling around after one of the most blatant price manipulation takedowns of the year.

March euro
http://futures.tradingcharts.com/chart/EC/35

February gold
http://futures.tradingcharts.com/chart/GD/25

The euro gold price fell to 318.50 this morning before reversing course to close at 320.37, still, another NEW LOW for the move.

How can it be there are so many pitiful people out there analyzing gold who can’t see what is going on here? Ah yes, I forgot again. They live in their own Stepford Wives/Matrix world.

The gold open interest fell 3705 contracts. It is a clue; a roadmap of The Gold Cartel’s collusive activity. The OI rose 9500 contracts with gold at $445. They capped the price in unison, waiting for their planned raid. Yesterday their raid went off on schedule, the unsuspecting specs were mauled and dumped positions. When gold took out $435, the crooks turned buyers. RUMOR has it Goldman Sachs bought 5500 contracts near the bottom yesterday, which is why gold closed $2.50 off its lows. Not bad for a couple of days work. Totally illegal because of the collusion: but, effective and very profitable. Should be another superb quarter for Goldman Sachs.

As always, the spineless gold companies see nothing, hear nothing and say nothing, like a bunch of numb monkeys. I nicknamed Goldman Sachs "Hannibal Lecter" six years ago because the gold companies put up with this nonsense as in "The Silence Of The Lambs." Little has changed in all this time.

Silver continues to meander and moves with little conviction either way. The silver OI rose 1835 contracts to 101,101.

Some silver goodies to end the year. Spoke to our STALKER contact who heard from his London bullion dealer silver source. This veteran in England said the following:

*He (and others) have two Saudi Arabian orders for silver totaling $10 million and are having "unaccustomed difficulty" in filling the orders.

*He is disgusted that silver closed below $7 for the year and blames it on the Fed/US Government. Mind you this is someone who never speaks about GATA, nor do we know if he has ever spoken like this in the past. The hands of The Gold Cartel and friends have become this obvious!

*Blames the low silver price on the New York silver paper traders. If they disappeared, silver would be $20 per ounce.

*Says these traders are clueless about what is really going on in silver. That there is no way they can cover their short positions. That they are in deep trouble, which will all become known when silver explodes, as it must.

*These traders are on their own Titanic heading for an iceberg. Meanwhile, they party on.

*Mexico will remonetize silver as it is in their significant interest to do so.

I queried my STALKER source why the London silver people don’t take delivery of futures contracts here and ship the silver over. He said he would get back to me.

The Comex silver stocks are bobbing around these days. They rose recently, but fell 658,298 ounces today, back to 103,589,752.

Silver’s future looks EXTREMELY bright as we sail into 2005. Gold should skyrocket next year too as it breaks loose from the shackles of The Gold Cartel. At some point, bullion will move sharply higher (well above $500) and do so independently of the dollar action.

The John Brimelow Report

Raiders awkwardly postured for New Year?
Thursday, December 30

Indian ex-duty premiums: AM $8.86, PM $8.94, with world gold at $436.20 and $435.15. High: lavish for legal imports. New York has just given the world’s largest gold importer a New Year present, which it is relishing.

Japan of course was closed today. Shanghai Gold Exchange premiums virtually tripled, to the $1.41 - $2.44 range, which is high.

Comex traded a heavy 74,216 lots yesterday (20% more than the estimate, and apparently more than half the week’s total)) but open interest fell only 3,705 contracts, only about a third of the build up of the previous two days. Several of the conventional dealer commentaries describe yesterday’s sell off as "long liquidation" (as usual - they never see short selling); some must have occurred, but the small open interest change suggests there are quite substantial shorts about. Selling variously described as "Bank" (Refco Research) and "Investment Bank" (Standard London) blocked gold’s rally efforts today, to ensure a close below $440 for the Comex year.

These sellers must be disappointed their raid had so little effect, given its scale. They are likely to find themselves in difficulty next week.

Best wishes for 2005 to all friends.

JB

CARTEL CAPITULATION WATCH

The DOW lost 29 to 10,799, while the DOG rose 1 to 2178.

Feb Crude Oil closed out the year at $43.45 per barrel.

US economic news:

08:30 Jobless claims (5K) to 326K in 12/25 week vs consensus 335K
The prior week's figure was revised to 331K from 333K.
* * * * *

09:57 Chicago PMI 61.2% in December vs consensus 63.0% - Market News
The November reading was unrevised at 65.2%.
* * * * *

10:00 Help-wanted index 36 in November vs consensus 37
The October index was unrevised at 37.
* * * * *

CHICAGO, Dec 30 (Reuters) - Business activity in the U.S. Midwest expanded in December for the 20th consecutive month but at a slower rate than expected, a report showed on Thursday. –END-

Here’s one way not to solve US budget problems.

-U.S. agency to take over UAL pilots' pensions

WASHINGTON, Dec 30 (Reuters) - The U.S. pension agency on Thursday said it would take over the retirement plans of pilots at bankrupt United Airlines, which are underfunded by $2.9 billion.
The Pension Benefit Guaranty Corp., which insures traditional retirement plans, said it would likely be liable for about $1.4 billion in guaranteed benefits, the third-largest claim in the history of the agency's program.
"Retirees will continue to receive monthly benefit checks without interruption, and other pilots will receive benefits when they retire," said PBGC Executive Director Bradley Belt.
The plans cover more than 14,000 active and retired United pilots and comes after a deal between the airline and pilots over concessions. The pension plans of the airline's other employees were not affected, the PBGC said.

-END-

There is a great deal of strategic geopolitical goings-on which could create havoc next year. The western press doesn’t seem to be paying any attention to these significant developments. Russia and China will be having joint military maneuvers soon. Now this:

MOSCOW, Dec 30 (Reuters) - China emerged on Thursday as a dark horse contender for the assets of stricken Russian oil major YUKOS as the company's state-driven break-up took yet another abrupt twist.

Amid intense speculation over who will become the ultimate owner of YUKOS's million-barrel-a-day oil unit, Yuganskneftegaz, Russian Energy Minister Viktor Khristenko said top Chinese oil company CNPC may end up with a one-fifth stake.

Khristenko's comments came after a top aide to President Vladimir Putin said Yugansk, bought at auction by state oil firm Rosneft for $9.4 billion, would not be included in Rosneft's planned merger with Russian gas monopoly Gazprom...

-END-

Then we have the new coziness between the Chinese and Venezuela regarding energy.

Yet, that is not all. Some excerpts from a recent piece by J. Vialls of Western Australia delves into a potentially troubling development for the US:

On 10 November 2004, the India Daily reported that, "Russian President Putin is taking a lead role in the most powerful coalition of regional and superpowers in the world. The coalition consists of India, China, Russia and Brazil. This will challenge the superpower supremacy of America." … "He [Putin] wants to establish a long-term Russian footprint in Latin America in order to expand Moscow's geopolitical influence in the region. Brazil is very open to the coalition concept where these large countries support each other in term of trade, economics, international politics and defense."

Just this single strategic move means that the new coalition embraces just over three quarters of the world's total population, eighty percent of its natural resources, and a majority of technical and scientific experts. Nor does it end there, because the coalition automatically includes the Shanghai Cooperation Organization (SCO), which is presently comprised of China, Russia, Tajikistan, Kazakhstan, Kyrgyzstan and Uzbekistan. Dangerously for America, the coalition will soon have another important member, Iran, currently due to enter informally in a few months time through the SCO "back door" because of a mammoth energy deal. We will return to Iran shortly….

-END-

Rhody on the lease rates:

Hi Bill:
As you can see from the included chart, gold lease rates are in slight backwardation, even though they have fallen by about one third in the short terms. This implies continued high rates of leasing at subsidized rates.

Backwardation almost always implies leasing pressure to short down the spot price, so despite the low absolute rates, the leasing pressure against gold continues. And why not, it's both a cheap source of gold and never needs to be paid back as lease contracts include a cash out clause for emergencies. (This begs the question why would anyone be foolish enough to lease their gold. The answer is the central banks would and do, but not because they are foolish. They are propping up the US dollar by creating the illusion that gold is less valuable than the paper.)

More interesting is the rise in silver lease rates. Gold rates have fallen and silver rates have risen across the board. Silver now demands 4 to 6 times the lease rates of gold over similar terms. This implies relative tightness of supply. Yet silver suffered more than gold in the latest correction. It's a smaller market, and therefore more easily manipulated.

Heavier manipulation over longer periods implies a much greater upside when this whole paper fraud system breaks down.

Please have a safe and happy New Years. Regards, Rhody

IF this news blurb regarding the World Gold Council’s GLD fund is correct, it reveals the WGC to be more inept than one can imagine:

Dec. 27 (Bloomberg) -- State Street Global Advisors is offering streetTracks Gold Shares, a gold-backed fund that is treated like a stock's initial public offering, the Wall Street Journal reported.

The fund is registered under the Securities Act of 1933 because it is run like an investment trust whose shares follow the price, equal to one-tenth of an ounce, of gold bullion, the newspaper said.

To follow the Securities Act, State Street must treat the Gold Shares fund as an IPO, where companies can't say much to investors, the Journal reported. This so-called quiet period never ends, the newspaper said. The fund has traded more than 6 million shares daily on average, the Journal reported.

-END-

In other words the World Gold Council can’t say anything important about gold to the investment world as long as they are involved with this fund. Perhaps this Bloomberg piece is off base. I should hope so.

Some things never change. And some things never get started. How can the leaders in The Gold Cartel be exposed month after month for one market shenanigan after another, for stealing the public’s money in the gold pits, and still be let off scot-free?

Bill,
Strange that these guys always show up when something illegal is taking place...
dk

JP Morgan Under SEC Scrutiny for Canary Trades - WSJ

NEW YORK (Reuters) - The U.S. Securities and Exchange Commission is examining whether J.P. Morgan Chase & Co. should have known that the Canary Capital Partners LLC hedge fund was making improper trades, the Wall Street Journal reported on Thursday.

Several employees of J.P. Morgan have given testimony to the SEC, the newspaper said.

The No. 2 U.S. bank's lawyers don't believe J.P. Morgan employees knew about the improper trades, but they said regulators could contend that the bank "should have known" Canary and its principal executive Edward Stern were "at least engaged" in short-term trading that violated rules of many funds, according to a memo to the bank's executives last September that was reviewed by the Journal.

The improper trades involved the rapid buying and selling of shares, known as market timing. Permitting hedge funds to market-time funds could be considered a violation of fiduciary duty by the fund managers. The profits earned from timing ultimately come from the pockets of long-term investors, regulators say.

Representatives from J.P. Morgan were not immediately available for comment, though a spokeswoman was quoted by the Journal as saying, "At the time that we were doing business, J.P. Morgan didn't know and had

-END-

Yeah sure, and the bank has no idea what their gold traders are doing either.

Speaking of hanky-panky, a couple of heads-up/thoughts for us on the Fannie Mae developments:

The Fannie Mae financing, with Lehman Brothers as the sole placement agent, actually raises more questions than it answers. To begin with, a financing of this magnitude is typically handled jointly and severally by multiple underwriters. And financings are usually doled out by companies as a payback reward for various unpaid investment banking duties such as capital market updates, enthusiastic analyst adulation, etc. The fact that this piece of lucrative business was given alone to Lehman should make everyone with half a brain wonder what Lehman is being compensated for. My guess is that Lehman is the counter-party to a lot of Fannie's funky derivative contracts entered into before the accounting fraud came to light and as such Lehman is exposed to economic risk that wasn't apparent when the derivative contracts were written.

Furthermore, one has to wonder who the buyers were of the preferred stock and convertible bonds. The fact that some investors anted up $5 billion in capital, given that Fannie has yet to file 3rd quarter financials and is being scrutinized for large-scale accounting fraud, is truly stunning. The fact of the matter is that if even Fannie can't put together required financial filings and its former auditor is no longer on the scene, how can any of the financial information in Fannie's computer systems be trusted, let alone trusted to the tune of $5 billion in fresh capital. It is hard to believe that typical institutional buyers could participate in this transaction and withstand scrutiny of fiduciary duties. We do know that Fitch recently downgraded Fannie's investment rating, and Fitch is typically the most thorough and conservative of the rating agencies.

We also know that it took a 7% dividend to get $2.5 billion of the capital raised. My sources in the junk bond market have told me that there are some below investment grade companies that could issue preferred securities at 7%. This is highly speculative on my part, but my guess is that the likely buyers of the paper would be the parties most interested in keeping Fannie alive, and that would be the foreign investors who have provided over 40% of Fannie's debt capital. Given the private placement nature of this financing, we may only find out who the buyers were if a large block of stock gets registered for sale if Fannie's stock ever gets above the $94.31 conversion price embedded in the convertible bond. All I can say is that this type of event reinforces reasons to be investing in gold and mining stocks.
Dave in DC

One more:

"A relative look at America's response to the earthquake"

December 30, 2004

Tectonic plates shifted.
Tsunamis crashed ashore.
The earth wobbled on its axis.

And the magnetic field that governs America’s moral compass continues to deteriorate.

A relative look at America’s response to the earthquake:

President Bush professed surprise that the world’s, and many American’s, first impression of US aid relief to the damaged countries was that America was being miserly. He responded that America has historically led the world in relief aid, the initial $35 million aid package would not be the last installment, and he intimated that the US response was not so trivial.

But relative to Franklin Raines’ fat "retirement" package of $1.37 million annual payment plus deferred compensation of $8.7 million, and lifetime medical and dental coverage, the US aid package looks pretty skinny. If Raines, now 55, lives to age 85 he will receive an additional $41 million dollars.

On the one hand, the case could be made that a bankrupt country could hardly be expected to make extravagant donations of money to another country in distress. After all, how would we do it? Just print the money out of thin air?

On the other hand, what is this country doing to help out poor ol’ Franklin and the boys at Fannie Mae who wrongly accounted for hedging transactions on its mortgage holdings, used improper "cookie jar'' reserves, deferred expenses so executives could get their maximum bonuses, and is probably carrying losses on derivatives far and above those which now force restatement of earnings by as much as $9 billion because at least that amount must be recognized now?

Well, let’ see….