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

CARTEL CAPITULATION WATCH

Is reality finally coming home to roost on Wall Street and to stock investors? Too early to tell, however today might be the start of something very disturbing to Joe and Jane out their in America. The bottom line is after Greenspan’s testimony was concluded, the US market headed south with some conviction. The DOW fell 80 to 10,754 and the DOG sank 26 to 2061.

While the US market has been firm of late, all attempts to take the majority of the major averages to new highs have been continually rebuffed. My take is the same. The good news is well behind this market. The mess in the Middle East and the US refusal to deal with our fiscal problems are going to go center stage and the market is likely to be pummeled for most of the rest of this year. I suspect the PTT is going to be overwhelmed at some point, like The Gold Cartel, and we are likely to experience some serious down moves, ones like we have not seen in years.

The bonds have reversed to the downside with a vengeance. There are all kinds of ramifications for the US economy if this keeps up.

March bonds (114 14/32, down 14/32)
http://futures.tradingcharts.com/chart/TR/35

One can see why The Gold Cartel/Working Group on Financial Markets is so concerned about capping the gold and silver prices. What do you think the mainstream world pundits would be clamoring about if gold rallied $20 this week? Bonds are sinking fast as is. How much faster would they be sinking with gold soaring and commodity prices making multi-decade highs? Those who still need a motive for The Gold Cartel doing what it does, you have one.

During a choppy volatile trading session, the dollar fell .24 to 83.48 and the euro rose .23 to 130.78.

US economic news:

08:30 Jobless claims for week ended 2/12 reported 302K vs. consensus 315K
Prior week revised to 304K from 303K.
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08:30 Jan. Import/Export Prices expected 0.9% vs. consensus 0.6%
Prior reading revised to (1.4%) from (1.3%).
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(That import number is fairly inflationary.)

10:00 Jan. LEI reported (0.3%) vs. consensus (0.2%)
Prior reading revised to 0.3% from 0.2%.
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NEW YORK, Feb. 17 /PRNewswire/ -- The Conference Board reports today that the Composite Index of Leading Economic Indicators declined 0.3% in January, following a 0.3% increase in December, and a 0.3% increase in November.
Says Conference Board Economist Ken Goldstein: "The picture at the start of 2005 is positive, but more spotty than robust. The leading economic indicators dipped in January, following two straight months of improvement. Prior to that, the series had turned down for five straight months, but the declines collectively have been relatively modest. Over the same period, the coincident index has remained positive. The spike in energy prices and the lower dollar took some steam out of the economy. But the larger concern remains cautious attitudes. Business concerns about the direction of cash flow could lead to cautious decisions about hiring and rebuilding inventory."
The Conference Board also reports that the Coincident Index was unchanged in January, following a 1.1% increase in December, and a 0.1% increase in November. The Lagging Index increased 0.3% in January, following a 0.7% decline in December, and a 0.2% decline in November..

-END-

12:00 Feb. Philadelphia Fed index reported 23.9 vs. consensus 17
Prior reading 13.2.
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12:01 Follow-up: Philadelphia Fed prices paid 43.5 vs. 66.1New Orders 11.7 vs. Jan 9.8.
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Here is a real potential trouble spot, one highlighted in MIDAS for some time. Fannie Mae made a 52-week low today, closing at $60.61, down $1.41.
http://new.stockwatch.com/swne…utilit_snapsh_result.aspx

DJ Greenspan: `No Reasonable Basis' For Large GSE Portfolios

By Elizabeth Price and Dawn Kopecki

WASHINGTON (Dow Jones)--Federal Reserve Chairman Alan Greenspan said he sees "no reasonable basis" for Fannie Mae (FNM) and Freddie Mac (FRE) to hold vast mortgage portfolios and told House lawmakers that Congress should consider gradually limiting their portfolio holdings to fend off "the problems that are almost inevitable."

"We have found no reasonable basis for that portfolio," Greenspan told the House Financial Services Committee, referring to the roughly $900 billion mortgage portfolios Fannie and Freddie both currently maintain. Greenspan said Congress should consider limiting their portfolio holdings over time, "because these institutions continue to grow and have the low capital they have and continue the hedging they need to do ... they potentially create ever-growing potential for systemic risk down the road."

-END-

In very late, bearish news for the tech sector:
17:59 Semi equipment book/bill reported at 0.80 in January vs consensus 0.92
The December reading was revised to 0.94 from 0.95. Bookings were (18.2%) vs a StreetAccount consensus of (11.0%); billings were (3.8%) vs consensus (8.2%).

From The King Report:

Merrill’s latest survey of global fund managers shows they expect deteriorating earnings, higher inflation and interest rates but they have gotten more bullish on stocks. Merrill’s David Bowles opines, "The bull case for stocks is now more about balance sheets than earnings." That’s called rationalization. The Merrill survey of 320 global managers shows the average balance fund is 55% equities, but 25% of funds are 65% or more in equities. The FT notes, "The average cash balance of funds in the groups surveyed had declined from 4.8% in August to 3.6%." Equity investors are at their most bullish reading since April. The FT also notes that a rival State Street survey shows Investor Confidence declined to 88 in February from 89.8 in January…3.6% cash is a new record low. Bear markets have invariably commenced when cash levels have gotten near 4%.

The BBC reports, "China has overtaken the United States in the consumption of basic agricultural and industrial goods, a new survey says. It is now the world's biggest consumer of grain, meat, coal and steel. Only in oil does the US consume more." And guess what happens to the price of oil when China starts consuming as much or more oil than the US consumes. China per capita consumption is far below US per capita consumption – Thank God! http://news.bbc.co.uk/2/hi/asia-pacific/4272577.stm

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Worth a note:

08:48 RIGS Washington Post reports liberal use of RIGS corporate jet
According to the Post, records show that RIGS frequently made its Gulfstream available to friends of former CEO Joe Albritton at the expense of RIGS. One of the beneficiaries was NBC's Andrea Mitchell, wife of Alan Greenspan and Chairman of the Fed, which regulates RIGS.
Reference Link
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This struck me also. Heard Congressman Ron Paul, whom I have had the pleasure of meeting in Washington, was speaking about gold on CBNC and went in to watch him. It took me five seconds to return to my computer when the CNBC economist had to suddenly interject his opinion of what Greenspan had to say about Social Security. Paul and his gold commentary was taken off the air….

Bill
Don't you love it. No sooner does Ron Paul come on who I was looking forward to hearing and CNBC cuts in the top corner of the screen and totally obliterates most of his statements and questions that began about a gold standard. Should I have expected any less? What a crock!
Peter Hill

Since silver has been center stage of late, I thought this overview might be helpful to newer Café members. I met Jennifer, the author, at my reception for Mahendra in Dallas last May.

DOLLAR COLLAPSE AND THE SILVER INVESTOR
by Jennifer Barry
http://www.discountsilverclub.com

America has prospered since the Bretton Woods agreement enshrined the US Dollar as the world's reserve currency. Today, over 60% of currencies held by central banks are dollars. Half of world exports are priced in dollars, as well as all IMF loans, and OIL. In order to get dollars essential for trade, foreign banks have to buy Treasury bills, or sell goods and services to American consumers. We no longer have a gold standard to restrain the printing of dollars. They cost almost nothing to produce, so we get to buy foreign products very cheaply. Since we run a trade deficit, where we import much more than we export, America has in effect a 0% loan from the world. This is sustainable only as long as other countries consider us a good credit risk.

For many years, the dollar was strengthened by this built-in foreign demand. However, this strength caused our exports to be very expensive, and forced many US manufacturers to outsource or go bankrupt. In November, we hit a record trade deficit of $60.3 billion. The only way to narrow this gap is to print money, that is, pay for foreign products with dollars that are less valuable. Federal Reserve Chairman Alan Greenspan has obliged, but the trade deficit continues to widen. It's now topped 5% of GDP, a level which usually causes a currency crisis.

The value of the US Dollar is based on supply and demand, and right now the supply is too high for the world's needs. Since 1999, countries have a new choice: the Euro. Russia, China, the Philippines, and Japan are currently considering holding more euros in their currency reserves. Until the US invaded, Iraq was selling its oil in euros, not dollars. In 2003, Malaysia proposed that Islamic countries use the Gold Dinar for foreign trade amongst themselves. If this happened, the demand for dollars would drop further.

In the last 2 years, the dollar has weakened significantly against the Euro and other world currencies. Japan and China were buying dollars to bolster our economy, and ensure that Americans keep importing goods at a blistering pace. However, in March, the Japanese changed tactics. They stopped buying US Treasuries, and decided to sell more products to other Asian nations. They've even been talking about establishing the yen as an Asian reserve currency. If China stops propping up the dollar too, its value will fall even further.

So, how can silver investors benefit from this potential currency crisis? First, printing money causes commodity inflation, and silver is not immune. It may be manipulated right now, but eventually, the supply deficit will cause the price to skyrocket. Since the dollar will be losing value at the same time, the price will rise even higher versus the dollar. Silver's artificially low cost is actually a gift, because it lets you stock up before the investing world discovers precious metals.

Second, silver is a real asset, and it serves as a safety net for your retirement savings. Paper investments are a promise to pay, a debt obligation of someone else. What happens if they default? Social Security has $7 trillion in unfunded liabilities, and will eventually go bankrupt, so you can't depend on it long term. Stocks could crash again, and bonds are destined to lose value as interest rates rise. Silver, however, has intrinsic value, and it can never be worthless.

Third, as people watch the dollar decline, inflation heat up, and imports become more expensive, they will start to lose faith in the dollar. Faith is important, since the dollar is a fiat currency, with no intrinsic value to support it. People will dump paper promises, and flee to hard assets like silver. It happened in the 1970's, and the commodity boom didn't end until interest rates passed 20%. Silver might become popular as money again, like it was for most of American history. In fact, it's already started. You can spend precious metals for goods and services, using GoldMoney, the Liberty Dollar, and the Gold Dinar, for example. Monetary demand will make you glad you bought silver when it was cheap!

jennifer@discountsilverclub.com

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An idea for GOLD RUSH 21:

Dear Bill,
I have been meaning to congratulate you on your efforts to convene at Gold Rush 21 the most influential analysts on the gold market. I would love to attend but my work load and my responsibility towards my young daughter, who has numerous major health problems, prevent me from travelling unless absolutely necessary, but I will be with you in spirit all the way.

I think this could be a seminal event for the future of the gold market and may well cause the market to trade " differently ", i.e. with less obvious manipulation, leading up to your convention. I would like to make one suggestion: The most obvious factor pointing to manipulation is what you discovered a long time ago - the "$6 Max up rule on any day."

In all my 24 years of investing and trading, I have never seen anything like it and I suggest to prove that this is indicative of concerted and illegal manipulation, that you hire 2 independent and well recognized statisticians (professors at well known universities?) to show what that probability is of happening on a recurring basis the way it has. It would involve going back to the beginning of the bull move and each day identifying when the rule took effect and then doing the statistical analysis to show that it would be as probable as my being beamed up to a spaceship.

I'm sure that is what the results would show and it would lend enormous credence to your/our thesis of manipulation and then would garner the attention (I hope) of the financial media, attorney generals, CFTC, etc. It is always very hard to prove manipulation but this would do it in spades and I think would force some authorities to look into it seriously and, at the same time, raise alarm bells for the general public. I admire your perseverance, tenacity, will to fight for a cause no matter how popular it is or isn't and I wish you continued success.
All the Best,
Michel de Chabert-Ostland

The $6 Rule really came into play once the gold bull move began in earnest. Back when GATA was formed a little more than 6 years ago, it was more like a $2 rule. All they needed then.

The reason for bringing this idea to your attention is to find out if there is some member of the GATA Army who might like to do some preliminary numbers work here. The thinking would be to demonstrate how gold has traded on a daily basis the past three years versus a number of other markets, how it trades compared to yesteryear, and to come up with other factual data which proves from a numerical sense gold is not trading as a free market should.

Please contact me if you have any interest in helping with this.

On Barrick:

Bill,
The headlines today reads, " Barrick Gold fourth-quarter earns jump" and "Barrick Earns $156 Million-$0.29 per Share-in Fourth Quarter." If you read the fine print, that $156 Million includes a $141-million tax credit and a $15-million after-tax reversal, $48 million in other deferred tax credits, a $24-million after-tax gain on asset sales and a $6-million after-tax non-hedge derivative gain. These were partly offset by $110 Million in write-offs. After canceling all these gains and losses out, I count $32 Million in operating earnings - a bit less than the headline. It is also interesting that there were no charges for covering hedges. They did, however, raise $750 million dollars that can be used for "general corporate purposes" — whatever that is.
Best wishes,
Peter R.

Regarding Barrick’s hedge book from a Reuters release:

Barrick, which has promised to whittle down its hedge book to zero over time, trimmed contracts by 200,000 ounces in the December quarter, beating its 2004 full year target of a 1.5 million ounce reduction by 500,000 ounces.

But the Toronto-based firm refused to give a reduction target for 2005, although Sokalsky said it was still committed to working down the position, which stood at 13.5 million ounces at year-end, or 15 percent of reserves…

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More good news from this staunch GATA supporter:

Gold Resources Increase by 34% at Seabridge's Red Mountain Project
Thursday February 17, 11:03 am ET

New 43-101 Technical Report Confirms Potential for Further Expansion

TORONTO--(BUSINESS WIRE)--Feb. 17, 2005-- A new 43-101 Technical Report has been prepared by SRK Consulting ("SRK") of Toronto on Seabridge Gold's (TSX VENTURE:SEA - News; AMEX:SA - News) 100% owned Red Mountain project located in British Columbia, Canada. At a 1.0 gram per tonne ("gpt") cut-off, SRK estimates an additional inferred resource of 1,729,000 tonnes at a grade of 2.97 gpt gold (165,000 ounces) in close proximity to gold resources previously reported by the Company for the project. SRK concludes that there is excellent potential to further expand the gold resources at Red Mountain with additional exploration drilling. The SRK Technical Report can be viewed on SEDAR at http://www.seabridgegold.net/images/Red_Mtn_Tech_Report.pdf

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Seabridge closed at $3.06, up 3 cents.

What a nice change of pace from the gold shares today and maybe a very important one. While the general market was doing a dive-bomb, the gold shares CLOSED ON THEIR HIGHS for the session, a fairly rare event over the past year.

The XAU gained 1.49 to 96.44, while the HUI rose 3.21 to 210.96. After checking key 210 late, the HUI popped near the close to clear this hurdle again and made a new high recovery close. Next stop 220. Of special note is the gold shares closed on their highs even as the general market shares were closing on their lows.

Lovely looking HUI
http://bigcharts.marketwatch.c…&o_symb=hui&freq=1&time=8

Tomorrow is a shortened day on the Comex with a US holiday on Monday when the Comex will be closed.

Been some tough 12 months, yet the big picture could not be clearer. The handwriting is on the wall. Gold, silver and the shares remain THE historic investment opportunity of a lifetime.

GATA BE IN IT TO WIN IT!

MIDAS

Shaka Jr. CONFIDENCE and all things FICKLE

I believe that if you could boil Alan Greenspan's overall Fed-Fiat agenda down to ONE item it would be "CONFIDENCE". That is what Al eats/sleeps and dreams about all day and night long.

I perceive that he's been having nightmares of some sort, since his fateful Frankfurt visit last November. Did someone show him how easily his "confidence equilibrium" could be upset? Time will tell I guess, beware the fluttering butterfly.

As reality shifts further and further from the fundamental fiscal facts of financial forthrightness, the fortuitous will find furtive fortunes foisted upon them from the four corners of the globe as the fickle foolish fall over each other to follow the golden faithful.

GO GR21
Buena Fe

The Korelin Economics Report – Welcome to All the New Listeners on “Talkstar”

http://www.kereport.com

[Blockierte Grafik: http://www.lemetropolecafe.com/img2005/Midas/Midas0217A.jpg]

[Blockierte Grafik: http://www.lemetropolecafe.com/img2005/Midas/Midas0217B.jpg]

Al Korelin and Paul Warren

The Korelin Economics Report debuted last weekend on a new network, “Talkstar”. Started by veteran radio personality, Victor Ives, “Talkstar” is headquartered in Florida and in addition to its family of radio stations it also provides programming on “Sirius Radio”, which is beamed from a satellite in outer space. (Who’d have thought that radio programming would ever come from outer space?) This is a big step for Paul and I, and we are proud to be part of this growing family of programming.

We began our program by talking with Steve Taylor, a Seattle based analyst. We discussed the record $617 billion U.S. trade deficit and the effects it could have on the price of precious metals and the conventional stock market.

The subject of the continuing high oil prices was also discussed.

My thoughts are that with the U.S. trade deficit at record high levels and the price of oil continuing to be over $40 per barrel, the Dow Jones Industrial Average, the Nasdaq Composite and the Standard and Poor’s Index will have to decrease in their respective values reflecting a drop in most share prices. Public companies simply cannot be pushed in a positive direction when these two factors are at those levels. Stop and think about it, when energy expenses are high, costs for virtually all businesses increase and profits go down unless those costs are passed on to the consumer. In either case, investors loose.

Investors loose unless they own shares in companies involved in gold or silver mining or some facet of the energy industry.

I think that you will find our interview with Steve Taylor to be interesting as it covers these subjects.

In the three following segments we interviewed Adam Lass, the founder of the Wavestrength Group, and Ann Sosnowski, an analyst who works with him. We were introduced to Adam by Addison Wiggin who, along with Bill Bonner, runs The Daily Reckoning. Adam is a pretty mainstream guy who is involved with investments on a daily basis. It was interesting to hear his prospective on the conventional markets because it was far from mainstream.

Lastly, we spent some time talking with John Kaiser. As most of you know, John writes The Bottom Fishing Report – a popular newsletter dealing primarily with the resource industry. We discussed the reasons for the current low prices of stocks in the resource industry and why they could be at higher levels in the near future. John also briefly described a company that he feels his subscribers should take a close look at. Click on this segment and see if you don’t agree.

* * * * * * *

Alexander Korelin is the co-host of The Korelin Economics Report along with Paul Warren. This program is syndicated nationally and can also be listened to on the Internet by going to http://www.kereport.com and clicking on “recent programs”. Guests pay no fees to appear on the program and neither Mr. Korelin nor Mr. Warren own any stock in the companies discussed unless it is fully disclosed.

Die Nettopositionen der Händler im Cot-Goldreport liegen noch im unteren Bereich:

http://www.gold-eagle.com/editorials_05/chan021805.html

Es sieht ganz danach aus, dass der Goldkurs auch weiter deutlich ansteigen wird. Beim Umfang der Positionen ist noch viel Spielraum nach oben drin.

February 18 – Gold $426.80 down 10 cents – Silver $7.39 up 6 cents

Gold Cartel Only Postponing The Inevitable/US Inflation Picking Up Steam

"...the control of credit also has become dangerously centralized ... The great monopoly in this country is the monopoly of big credits. So long as that exists, our old variety and freedom and individual energy of development are out of the question. A great industrial nation is controlled by its system of credit. Our system of credit is privately concentrated....This money trust, or, as it should be more properly called, this credit trust, of which Congress has begun an investigation, is no myth; it is no imaginary thing. It is not an ordinary trust like another. It doesn't do business every day. It does business only when there is occasion to do business. You can sometimes do something large when it isn't watching, but when it is watching, you can't do much. And I have seen men squeezed by it; I have seen men who, as they themselves expressed it, were put "out of business by Wall Street, because Wall Street found them inconvenient and didn't want their competition. "
Woodrow Wilson

GO GATA!

When taken in toto for the week, we had the most visible evidence of gold price-capping and market manipulation since GATA’s inception in early 1999. What a sick group of Orwellians we have orchestrating the financial markets and the minds of an unsuspecting American public.

From last night’s MIDAS:

"It was back and forth in choppy action all session long with gold capped by the cabal to make sure no inflation signals might crop up to embarrass Chairman Greenspan while he was assuring Congress, Wall Street and America all was under control."

From Wednesday’s MIDAS:

``The economy seems to have entered 2005 expanding at a reasonably good pace, with inflation and inflation expectations well anchored,'' the Fed chairman said in the text of testimony to the Senate Banking Committee.

To demonstrate to the investment world chairman Greenspan told the truth to the House and Senate Banking Committees one only needs to view the subdued action of the gold price – according to the Orwellians. It is one of The Gold Cartel’s principle motives for doing what it does so well and so consistently: deceive the American public and investors around the world about the true status of American financial market policy and what is going on in the real US economy.

Yesterday the surprise was very high import prices. Today that inflationary bit of news was bolstered by yet another inflationary surprise:

US core producer prices log biggest jump in 6 yrs

WASHINGTON, Feb 18 (Reuters) - Sharp gains in the cost of cigarettes and autos helped push core U.S. producer prices up at their fastest rate in six years in January, while overall prices also edged higher, the Labor Department said on Friday.

The producer price index, which measures prices received by farms, factories and refineries, moved up 0.3 percent in the month, the department said. But the core index, which strips out volatile food and energy prices, shot up 0.8 percent, the biggest gain since December 1998….

-END-

But wait, facts don’t matter in the Orwellian society. What counts to these heinous people is SPIN. Greenspin spoketh "inflation is under control." So that is the way it is, and to prove it is under control, look at the unresponsive price of gold to the inflation news as gold is a standard world barometer of inflation and mostly US inflation.

Well, this leaky Gold Cartel dam is about to burst. You can only fool so many of the people and the world investment community for so long. The charts tell the true story this week. You would never know it by looking at the gold chart however:

April gold (a move above $431 and it is all she wrote)
http://futures.tradingcharts.com/chart/GD/45

Silver is more like it and this is taking into account the flagrant, bozo attack on this market by The Gold Cartel during quiet Access Market trading hours on Tuesday evening:

March silver (ready to streak again)
http://futures.tradingcharts.com/chart/SV/35

But, there is no inflation? Not so Mr. Greenspan, when reviewing the economic reports released this week. Nor when one looks at this CRB chart either:

April CRB (breaking out)
http://futures.tradingcharts.com/chart/RB/45

The spot CRB closed at 290.66, up .67 and just below 23-year highs. The move was led by rebounding crude oil, which finished the day at $49.01, up 71 cents per barrel. Sub-$40 oil is for the dreamers.