12. Juli 2026, 22:51
Have to chuckle at this one:
Alert Name: Acts of terror
Canada minister barred from flight
03/02/05 12:15 PM, EST
Canadian Defense Minister Bill Graham had trouble boarding a plane to the United States in January because his name was on a U.S. no-fly list designed to deter terrorists, the Globe and Mail said Wednesday.
FULL STORY
Important commentary from Richard Russell a couple of days ago:
President Bush wants an "Ownership Society." Well, I've got news for him -- we already have an ownership society. Americans borrow and the banks own them. Today everybody (except a small segment of the very rich) is in debt. I've heard it said that the typical American family couldn't raise three thousand in cash if their life depended on it. Sounds about right to me.
So let's call it what it is. We live in the debt-society, and our current "prosperity" is based on debt, debt and more debt. Is it a plot? Is it some kind of diabolic "foreign" scheme? Not at all. It's part of the law of unintended consequences. You see, following the bull market top of 2000, instead of allowing the US economy to correct, the Greenspan Fed decided to fight the bear "tooth and nail" (doesn't that sound familiar to veteran subscribers?). It was a case of "Inflate or Die."
How do you fight deflation and a potential economic collapse? You do it with negative interest rates (rates below the inflation rate) plus easy, very easy, credit. How is credit created? It's created through borrowing. So the Fed and the Administration made it really sexy to borrow. The "carry trade" went into high gear, borrowing at low rates short term, while buying longer-term bonds paying higher yields. At the same time, US consumers plunged into the housing market. Instead of "a chicken in every pot," the modern slogan was "a mortgaged home for every family." And if you can't pay for the home, well get with it dummy, the government will even lend you the money for your down-payment.
So that's where we are today in the "ownership" society. Last Friday (taking in all three exchanges), 55 Finance stocks hit new highs, 25 building stocks hit new highs, and 13 banks hit new highs. Which can't be much of a surprise. Of course, with crude now just below 52 dollars a barrel, energy is the latest "hot area." Last Friday 141 assorted Energy stocks hit new highs. At this rate, it won't be long before the oil companies will own us here in the new "ownership society."
I've described how Alan Greenspan studied the 15-year deflationary Japanese bear market. That was the bear market where some Tokyo real estate dropped up to 90 percent from its 1989-peak. In Japan more than 80 percent of bank loans were tied to real estate, so the banks took huge losses and guess what -- the banks stopped lending. And today the Japanese are still trying to recover. After all, Japan's bull market high in 1990 was 40,000 and today the Nikkei is trading just over 11,000.
How about a bit of history? Greenspan made a careful study of the Japanese deflationary bear market, and he must have said to himself, "I failed to recognize the bubble, and that was (gulp) my fault. Now the stock market's caved in, and the US could be another Japan in the making. Well, damn it -- it isn't going to happen on my shift." Greenspan may also have read Richard Koo's informative book, "The Balance Sheet Recession." At any rate, Greenspan decided that it was time to fight the bear "tooth and nail." Next step, Greenspan drove short rates down to 1% and at the same time he flooded the system with liquidity. Meanwhile, the Bushies instituted two tax cuts. I mean, was this goosing the economy or what!
At around the same time, China and other Asian nations decided that they must keep the dollar strong versus their own currencies -- all in their intense battle to be able to export on advantageous terms. The result is described in this week's Economist magazine. In the meantime, with the dollar sliding (oil is traded in dollars) and with China and India becoming major oil competitors, the price of oil was heading north.
Here are some quotes from the article in this week's Economist --
"Saturated. The world's giant money printing machine. How loose is the world's monetary policy? One gauge is that real interest in America and other countries are still negative. Another is that global liquidity has been expanding at its fastest pace for at least 30 years. This deluge largely reflects the combined effect of American and Asian monetary policies.
"One measure of 'global liquidity' consists of the sum of America's monetary base (notes and coins plus bank's reserves held at the Federal Reserve) and foreign-exchange reserves held by the central banks around the world. In both 2003 and 2004 this rose at annual rates of more than 20 percent. In no other two-year period since 1975 has liquidity increased so much.
"America's easy money policy of recent years has spilled abroad. Low American interest rates have encourage large inflows of capital into emerging economies, especially those of Asia, as investors have sought higher returns.
"Central banks are supposedly the guardians of money. Yet between them they have created the biggest liquidity bubble in history."
Russell Comment -- So you want to know what's really going on? This is it -- we're currently living through the greatest and most fantastic liquidity bubble in history.
As inflation heats up even further, the world's central banks (maybe out of embarrassment or fear) will be forced to raise rates. Or somewhere ahead, the so-called "bond vigilantes will do the central banks' work for them. Somewhere ahead (nobody knows the exact timing) rising interest rates will run headlong into the world of leveraged and overvalued investments (think real estate). By that time Alan Greenspan hopes he will be safely out of office -- and hopefully out of sight.
-END-
He is so right about liquidity fueling the US stock and real estate markets – now helping to fuel the commodity market surge.
He is also right about Greenspan’s approach to the markets. One more time for this Oldie But Goodie:
January 7, 1999 - Spot Gold $291.40 up $3.90 - Spot Silver $5.23 up 8 cents
Yesterday, I had a wonderful conversation with internationally renowned and London based, Teddy Butler Henderson. "Teddy", one of England's respected elder statesmen, has a very highly regarded investment service and is very well plugged in with the investment community in Europe.
You will get a kick out of this story. I sure did. "Teddy" had lunch in London with Alan Greenspan in 1971. Greenspan had his own consulting firm at the time. Both "Teddy" and Greenspan" were believers in the Kondratieff wave (cycle) theory. Greenspan told Henderson that his ambition was to become the top man at the Federal Reserve.
Knowing the Kondratieff cycle would be predicting a crash or depression of sorts about the time he would become head of the Federal Reserve, Greenspan told Henderson he could stave it off by various means (injecting money into the system, supporting the dollar, etc) and he intended to do just that if his career ambition came true. And you wonder if the gold market has been controlled!!!!!
Teddy (TBH) has been a believer that the dollar is in deep doo doo and, that while it has been weak recently, it has more downside to go - about 5% more against the Euro. Guess who wants it that way? Contrary to what you might think, it is Alan Greenspan, according to TBH. Teddy says that Greenspan knows that he had to take certain steps to keep the bubble going (a la the conversation he had with him 28 years ago).
Greenspan knows that our trade deficit is a problem and that our manufacturing sector and real world export sector of our economy needed help. Thus, he made the decision some time ago to work on getting the dollar down. To keep our bubble going, he needed to have this sector of our economy become more competitive. Solution - lower dollar.
Now, this does not make the euro crowd very happy according to TBH. Their reserves are in dollars and with the new start in EMU, they do not want economic problems for themselves. Today, for example, there were reports of a French, German clash over farm policies. A lower dollar can only exacerbate that clash.
At the same time, the EMU wants a strong euro in general. But they want it that way because of a strong economy, not a weak one. In that light, TBH feels that they will up the gold backing of the euro as a reserve at some point in the future. Interestingly, we reported talk of this to you some time ago and today's ECB comments are very encouraging. Teddy feels that the ECB will break ranks from Greenspan in his efforts to keep the price of gold down, referring to Greenspan's comment last July to a congressional committee, " Nor can private counter parties restrict supplies of gold, another commodity whose derivatives are often traded over the counter where central banks stand ready to lease gold in increasing quantities should the price rise". It is this breaking of the ranks that will spur the price of gold to much higher levels according to TBH.
TBH has been a big fan of the US stock market and has his followers heavily invested here (while hedging the currency risk). His reasoning is the strong U.S. economy and he knew what Greenspan was up to. He invested in the US equity market with conviction ( and with the help of his 28 year old information ) knowing that Greenspan would lower interest rates sharply in a pinch. For the future, he sees inflation in the US as workers demand much greater compensation for their efforts, especially as they see this incredible stock market rally. TBH thinks Greenspan will be very slow to hike interest rates in response to this inflationary threat, citing previous false alarms of inflation.
However, that growing U.S. inflation is the other reason TBH is bullish on gold. His long term U.S. equity outlook is not a rosy one, however. TBH sees the Greenspan induced bubble blowing up by August. Sometime before then, he plans to advise his clients to bid sayonara to Uncle Sam and our stock market.
-END-
The latest on GLD:
From the astute Chris Harris of http://www.harriscapitalmanagement.com
spent a good part of the day today doing research and haven't spent a lot of time writing. I was watching the new ETF gold fund trade next to the new ECBT gold futures contract to see how closely it was being arbed. It wasn't being arbed that closely, which was a little surprising to me since markets like the DOW diamonds move in locked step with the Dow futures, never more than a tick or at most two apart...indicating that there are autonomous arb robots in use between the two DOW markets but not in the gold markets. There may be an opportunity to exploit that.
-END-
Rhody on lease rates:
Hi Bill:
As you can see from the included graphs, gold lease rates were in massive backwardation in early 2001 and since then rates have declined consistently since then. By 2002, the spread between one month and one year rates had become a more normal .5% and since that time these spreads have shrunk to the present miniscule .1%. At times these spreads have been as low as .07%. One could say that the rate curve has tended toward zero and towards incipient backwardation at very low levels. These two trends seem contradictory. I see a deflation in lease rates that parallels a deflationary spiral overall.
So far this year and for most of last year, the once month term has had a tendency to rise, while the one year rate has continued to fall. Any trend that continues this long and marks a change in a previous pattern begs analysis.
Could we have a gold carry trade here? I am not talking about the traditional gold carry of lease gold, sell it and buy US dollar bonds of higher yield. I am talking about borrowing gold at low short term lease rates, and leasing out the gold again at one, two or even 5 year terms at higher rates. This captures the spread in metal interest and explains the fall in long term rates and the recent rise in short terms.
As leasing short term increases, the demand would raise rates. This gold is then leased out for one year, and the added liquidity would drop rates at the far end of the curve. The spread that is captured by this carry would be in the form of gold ounces, and these could be sold on the spot market. This too would depress spot gold. What I am describing here is gold carry piled on gold carry and all of it would be negative to the gold price. No wonder the bullion banks are confidant in piling on the futures trade shorts!
With this sort of pressure, I am amazed gold has risen at all. Only the physical demand has kept gold from total collapse. If true, what will end this carry trade? One possibility is a default or two on the long term lease end of the carry.. The other is a complete elimination of the spread over time. That trend is well established. Short term backwardation events will not interrupt this carry as it is the long term lease that is defining the profit, and these contracts are immune to short term events. I should mention that the increased supply of one year leases in gold facilitates mine hedging which is also a negative to the gold spot price as it encourages new mine gold production.
Here are today's lease comments. Gold was mixed, with the spread between one month and one year a low .1% or thereabouts.
Silver leases gained back about half of what is lost in the near terms.
Silver is beginning to display the same narrowing spread pattern between one month and one year rates as gold. It is now at .87% (.85% yesterday) Could this indicate a silver carry as well? We have a financial system based on debt, so why not? Does such a system imply that not having debt means one is poor? I better sign off before my mind explodes.
Rhody.
http://www.kitco.com/market/lfrate.html
Rhody on gold:
My two cents: Gold is a reserve asset for central banks because they list it as such on their books. So despite "going off the gold standard" in 1971, gold is still held as money along side all the paper stuff like T-Bills and currency in the vault. Gold is money because that is how it is being treated. Having said this, gold is detested by the present fiat financial system.
Gold is the antithesis of fiat. So, gold is held as part of the reserves, not because they like gold as an asset, but because they need the stuff as ammunition to throw at the gold marekt should the price of fiat fall. (Falling fiat values cause gold prices to rise.) Since central banks are in the business of creating fiat, and conning their respective people into working all their lives for pieces of paper, it is critical that gold never becomes perceived as a superior money and currency. When gold rises, central banks dishoard their gold reserves to attempt to suppress the price. That gets us to the present mess. Gold is rising and fiat is falling as central banks print banknotes by the truckload to stimulate their economies.
So inflation is becoming a problem. At the same time gold is thrown at the gold market to suppress its price. Look where that puts gold mines! The price of their product is suppressed while their costs inflate because of central bank stimulation.
This is why I have stopped investing in gold shares. Buy the metal, not the paper. "You will be at the end of a long line of people selling gold shares." (ANOTHER, 1997) I didn't understand this at the time, but I sure do now.
Regards, Rhody.
Good stuff from Rhody. I differ on one main point, however. My BET is what he is referring to re the shares is what we just went through. It has been a long line of sellers for a year now. That should be over. One reason is the public still can’t spell gold shares yet. When the US stock market and real estate head south, massive numbers of new investors will turn gold’s way. The tiny gold share market will not be able to handle all the buying. The gold shares will go ballistic.
Food for thought:
Hi Bill-
Our days are getting closer. As always, thank you for your courage and persistence.
Frank Veneroso presented the following, as I'm sure you are aware during March of 2003:
Gold:
The Investment Case, the Commodity Case
By Frank Veneroso
Dolder Grand Hotel
Zurich, Switzerland
March 21, 2003
http://www.canarc.net/venerosos_corner.asp
At that time, approximately two years ago a paragraph of his report stated on page 5 the following:
On the internet there is still much discussion of the gold loan position. Many gold bulls are eagerly awaiting the inevitable short covering explosion in gold. Well, it’s time has passed. What we have instead is simply a gold market under management by an official sector that has far less ammunition to enforce its management than most people realize. For this reason we believe that the official sector will lose control within perhaps 3 to 5 years. If investment demand materializes in the global gold market, that day will come earlier. There is mounting evidence that investment demand may now be entering the gold market and that such demands will increase. So let us turn to the prospect for investment demand for gold.
"official sector will lose control within perhaps 3 to 5 years. If investment demand materializes in the global gold market, that day will come earlier."
Today, March 2005, if Mr. Veneroso still believes this to be the case, then the above is now saying official sector will lose control within perhaps 1 to 3 years. If investment demand materializes in the global gold market, that day will come earlier."
Ok, now for my quick question(s). The next time you have the opportunity to speak with Mr. Veneroso, could you ask if he still believes the above to be the case and what is his current take on the subject "investment demand for Gold" since his presentation during March of 2003.
I believe all Le Metropole Members would enjoy, if possible, hearing of Mr. Veneroso's latest view. Thanks.
Go Gold Rush 21
Respectfully,
Bernie
Good news for these GATA supporters and for those Café members who own their shares:
Sur American
http://home.businesswire.com/p…0050301005953&newsLang=en
Klondike Star
http://home.businesswire.com/p…0050301005915&newsLang=en
Been a rough haul for my stocks this year. This one is bucking the tide. Remember when AfLease CEO Neal Froneman came to visit Charles Pace and me in Dallas last fall and was featured in the MIDAS? It has more than doubled since then. Neal is coming to Gold Rush 21 as are a number of other notable gold/silver company CEO’s.
AfLease closed in the U.S. at $8.15 today, up 15 cents. In the last 12 trading days it has gone up 35 percent and has gone up every day except one:
http://finance.yahoo.com/q/hp?s=AFLUY.PK
Long-suffering Golden Share Resources shareholders, like me, finally had a decent day. Been some rotten 14 months. Call me Downhill Bill on this one - $8.64 all the way down to $2.67. From a technical perspective we had an outside day key reversal to the upside as it made a new low for move and closed higher than yesterday’s high. I still have a great deal of confidence in their management to turn this bugger around. They should get their production up to 300,000 ounces this year and cut costs which skyrocketed. It finished the day at $2.98, up 23 cents. No reason Golden Star shouldn't reach $21 per share within two years.
Golden Star Resources
http://new.stockwatch.com/swne…utilit_snapsh_result.aspx
The gold shares caught a few bids, yet remain lackluster. The XAU rose 1.27 to 98.12 and the HUI gained 2.79 to 213.31. On a positive note the HUI took out 210 support, falling to 208.58 and then reversed course. Like that action. Once it takes out 220, look out above. Rocket ride time.
HUI
http://bigcharts.marketwatch.c…&o_symb=hui&freq=1&time=8
The leap in US commodity prices is no fluke. They are rising across the board and are likely to go MUCH higher as the year wears on. As mentioned above, gold and silver are ridiculously undervalued thanks to the price suppression scheme of The Gold Cartel. With the physical gold market so firm, it is only a matter of time, and I think not too much time, before gold and silver explode. More and more investors around the world want in on the commodities play. Gold and silver will be the grandest of them all.
GATA BE IN IT TO WIN IT!
MIDAS
The Deep Dark
By David Bond
Editor, http://www.silverminers.com/
Wallace, Idaho – "Hearses were in short supply in Kellogg, Idaho, in May 1972. A pickup hauled a dead miner to a hillside cemetery slashed with freshly turned earth. Another arrived in a station wagon."
Thus begins "The Deep Dark: Disaster and Redemption in America’s Richest Silver Mine," a riveting, page-turning and gut-wrenching account of the May 2, 1972 Sunshine Mine Disaster by New York Times best-seller Gregg Olsen (Abandoned Prayers, Starvation Heights, Cruel Deception, Bitter Almonds). The Deep Dark is due for release by Crown Publishers on March 1st.
From the very first of his 319 pages Olsen wraps you around his finger at the Jewell Shaft portal that fateful morning and doesn’t let go until the last of the 91 men who lost their lives in the sudden and impossible hell that enveloped them at the lunch hour a mile deep inside is laid to rest. You can read Clancy or Higgins for great fiction, John McPhee or Jack Olsen (no relation, but a friend and mentor to Gregg’s nevertheless) for non-fiction, and you will find none better.
I read the rave reviews of The Deep Dark from Publisher’s Weekly and the like and wonder if they read the same book I did. They talk of the bravado and macho of mining men like this was something different out here in the Old West. Oh, one supposes there is some truth to the notion that western hard-rock miners are a breed apart. Indeed, hard-rock mining is part balls, but it is also part intellect, part luck, part skill, part determination, part creativity – and it is surely no part dumb labor, at least not in the sense that the practice of law or banking or accounting are dumb labor. There’s nothing rote about hard-rock mining.
Nor is hard-rock mining, by the standards of this day, exceedingly dangerous. Truckers, power company linemen, loggers, pay a far higher workers’ compensation premium than do miners. This will come as a shock to most miners. (Review the stats further and you will discover that for municipal employees, it is far more dangerous to be a sewer worker than it is to be a cop.) Bring up either of these well-documented comparisons in the wrong bar, however, and your jaw will be merged with your lower stern bearings.
It is the suddenness, the strangeness, the swiftness and the violence that injures or kills a hard-rock miner that gives us our death-fix with these people. And the fact that mining camps are small places. If your partner gets "slabbed," (crushed to death in a sudden fall of rock from the back of a stope) there is a good chance he was on the school board, or an uncle to your neighbor’s kids, or coached little league, or taught debate.
No, what strikes this western reader is Olsen’s brilliance in bringing out the ordinariness of the men of the Sunshine Mine, then and now, the ordinariness of hard-rock miners and their human dignity. The kiss from a young wife. The plans to wash and wax the vintage Ford at shift’s end. The car-pool to work and its conversation about dumping shift that day to celebrate a friend’s birthday. And underground, even as death enveloped them, the passion of a man to save his friend’s life, to not get on the life-saving mile-long cage-ride to the surface until he was sure his partner was all right and already aboard.
It’s about guys who wouldn’t leave their jobs underground, at the controls of the hoists and aboard the cages, miners who having escaped death went back into the gas-choked mine to join a rescue team because there were men alive still underground, and gave up their own lives in so doing. Because they were miners. It is about the guilt of the survivors – a story as common and strange as war.
On another level, The Deep Dark is an indictment of Nixon’s mid-1970s corporate America, the age of the leveraged buyout, where accountant- and law-degreed middle-managers dithered while a mile beneath them, men’s lives hung on every second of indecision. And the fury of real mining men against this corporate Pablum, the fury of young men who would become decades later captains of this industry. Harry Cougher. Art Brown. Among the first of the "helmet team" rescue guys who understood the gravity of the situation a mile beneath them while men without chests awaited orders from higher up and sussed-out their financial projections.
The horrors of the Sunshine Mine Disaster I will leave to the reader of The Deep Dark to unearth. They are plentiful and graphic to a fault. But they are not told in a "he said-she said" vein. You see first-hand the Sunshine Mine Disaster from the eyes of the men who were there. It is their tale. It’s a narrative style you will find refreshing – told by a journalist who has the dignity and the decency to be invisible. Gregg Olsen makes you the lens of the camera. He is not in the scene.
The Deep Dark will open old wounds in my mining camp. Huge wounds, ripped apart by a UPI reporter who posed as a Red Cross candy-striper in order to infiltrate the rain-besotted camps of soon-to-be widows and orphans until he was called out by a miner for the fraud that he was. (Trust me: 30 years later they still hate journalists here because of his hi-jinks.)
Huge wounds, ripped apart by network television crews who hijacked Big Creek homes and power lines to file the latest sensationalistic lede. Huge wounds, ripped apart by Nixon’s Secretary of the Interior, Rogers Morton, who parachuted in to the mining camp to assure all of us that the mining company was doing all that it could even as Cougher and Brown chafed.
Huge wounds, ripped apart by "Jerusalem Slim" – Sunshine CEO Irwin P. Underweiser – who flew out from New York to set jittery shareholders to right by announcing, before the first corpse came out, that Sunshine Mining Company had production interruption insurance, and that a cessation of operations would improve the silver price – even as men still breathing that cruel air screamed from below in vain to be hoisted out, that from the company’s perspective, the Sunshine Mine Disaster was a good thing.
Huge wounds, ripped apart by a tragedy that killed every seventh father and uncle in this mining camp.
Yes, Gregg, you stepped into my mining camp and you reopened huge wounds. But I think in a way I would have wished I’d done, you also healed them.
One of the protagonists of your book, Ken "Ace" Riley, was my next-door neighbour on Wallace’s South Hill. He woke us up on occasion in the 1980s, screaming the black-and-white replays of his nightmare underground, of losing his partner Joe Armijo, in the deep and the dark. Ken’s kids, Greg and Randy, taught me how to chop wood. And next-door neighbour Ken, when my pipes froze up, was first in the attic of my log cabin to show me how to cheat a copper fitting and make it work. He gave me a stolen Hecla axe, and took up where his kids left off, and within a week I could make toothpicks out of logs.
Ken Riley was just one of 200 men living an uncommon life, with a common story. When we met I was a journalist and he was a miner, working, after the fire, in Sunshine’s lamp room. But we shared an affinity for Heidelberg beer and good conversation. We almost never talked about the fire. But it hung upon our shoulders like St. Elmo. He talked obliquely about how the union and the company had screwed the men, but I never knew his real story until I read Olsen’s book. Ken’s kids tell me now that, yeah, I never really knew the Old Man. He didn’t want to unload, back then.
But Gregg, he talked to you.
I was shooting stick at the Long Shot Saloon (formerly the Tip-Top) in Kellogg one Saturday morning four years ago when Gregg Olsen wandered in, looking for me, wanted to know what I knew about the Sunshine Mine Disaster, said he was writing a book. Well, I’d heard that happy horseshit before, besides I was always going to be the guy who wrote that book and who was he? Then he started shooting out names like Dionne and Beehner and Kitchen and Bush, the real guys. Told me more about those guys than I knew myself – and they were my neighbours. I told him about Ace’s nightmares; he’d already heard, they’d already talked.
Then Gregg went away, to work over every Sunshine Mine Disaster survivor and widow still living for their recollection. This part of research preparatory to writing is – trust me – the most difficult. And my friends reported back to me: "I think this guy gets it."
The pre-publication copies of The Deep Dark are in circulation this month up here, prior to its release to the New York snobs. (CBS News, by the way, does not want to touch this story because it is such ancient history. Apparently, so is the Hard Rock West. Hurricane Dan as dinosaur slayer. The story wasn’t good enough for them then: Why would it be now?)
Here is one widow’s reaction:
"You have written such a powerful book. It took me back to those horrible days when the entire valley waited for words of hope. My father-in-law was Bob Bush, he was one of three men in his family who died in the mines. My ex-husband got out of the Shine in the early 80's, and we moved to Alaska. We are so much a product of that environment. So many memories, so many names. Buz and Jenny remain dear friends. Thank-you for writing it, for giving them dignity. Thank-you also for clearing up the mystery of why it was so lethal. My husband may have known, but he never told me. My thanks are so pathetic an expression of what I feel for the miracle of this book you have written. I had wondered for years why no one had taken on the task. You have struck the right note.
"I must tell you also, I consumed this book. Obviously so painful a subject would not be savored, but I couldn't stop. I missed my yoga class and read for 6 seemingly short hours."
It was signed by a Sunshine widow, just a few days ago.
Hey, you with the cute charts: Men die for you. Hey you with the pump-and-dump scam. Men die for you. Ninety at a time, in the exploration camps, in the hard-rock mines. Does that make you, Mr. Normal with your accounting degree, feel superior?
Men die. It’s a fact of life for all of us. What Gregg does is dignify, for the first time in American literature, the hard-rock miner that walks amongst you. He is not macho. He is simply an American man. This is the stick-man miner of Hart, Twain and Solomon, suddenly flesh and bone.
The men who make lousy charts and stock scams are different from the men who actually bring you silver. Miners are living, breathing sentient human beings who occasionally die for you.
Gregg has breathed life back into the inert bodies of the 91 dead of May 2, 1972. That the Sunshine Mine is now in the hands of a man who lost uncles, grandfathers and friends in the Newcastle coal fields is of no small consolation to me. To understand mining at that visceral level – that mines are holes in the ground that occasionally do nasty things, especially if management is not looking – is not something your average MBA can suss.
Mines kill while you play with your chart toys in your air-conditioned condo in Florida. The beauty of the miners’ dignity is that they know this and go to work anyway. The least of the day’s pay hands has a triple-nine silver round on his mantle. He believes in what he’s doing.
Thank-you, Gregg. You’ve reminded the miner of the dignity he always had, a dignity that the poofters in their Park Avenue lofts will never know.
Gregg has healed us, vindicated our labours. Before you buy an ounce of silver stock, read this book. And give Gregg Olsen a Pulitzer. The American West has always had a friend in the hard-rock miner. Now the miner has a friend.
March 3 – Gold $429.60 down $2.70 – Silver $7.19 down 10 cents
GATA Sends Press Release on Stunning GCC Gold Report To Middle East Business Editors in Both English and Arabic
Perhaps that's all any of us can do. Choose one small piece of turf, be honest with ourselves, choose our approaches, stay in touch, remain constantly open to new ideas and new approaches, shut up, go to work, and hope for the best... Eliot Wigginton
GO GATA!!!
It was the usual Gold Cartel Comex drill this morning. Gold was due 70 cents higher based on the activity in London with the AM Fix at $ 433.25. However, just as gold was bopped for $1 near the close by the crooks on Wednesday, gold was immediately dropped $2 from its opening expectations. The dollar was doing little and commodity prices remained firm. An angry word must have gone out from cabal headquarters last night about letting gold rise in euro terms.
One possible reason for gold’s softness could be the latest from the moron the South Africans have in charge of keeping The Gold Cartel afloat. South African Finance Minister Trevor Manuel is nothing less than a traitor to his people. Either that or he is one of the dumbest finance ministers in history:
SAfrica backs IMF gold sales for debt relief-finmin
CAPE TOWN, March 3 (Reuters) - South Africa's Treasury supports the proposed use of IMF gold sales to finance debt relief for poor countries -- a process which need not disrupt the market, Finance Minister Trevor Manuel said on Thursday.
In a written reply to a question from parliament, Manuel said he favoured including 5-year quotas for gold sales allocated to central banks in 2004 for the process.
"The National Treasury supports the use of IMF gold sales to finance debt relief for poor countries," he said.
"The sale of IMF gold when done in a managed manner that is transparent, clearly communicated to the market and ideally along the central bank gold agreement, will mean that the market can price in the IMF gold sales and thus cause no disruptions to the market price of gold," he said.
((Reporting by Gordon Bell, via Johannesburg newsroom, +27
-END-
Listen, you dimwit Manuel. Just your comments like this send the price of gold lower. Meanwhile, production costs keep going up in your country and your mining companies have to lay off workers. $430 gold does not cut it anymore for a number of your gold producers. You should be talking of ceasing all central bank gold sales, so the price will rise enough to put miners back to work, which will stimulate your economy and help the poor. Need I say any more:
S.African DRDGOLD says may mothball North West mines
JOHANNESBURG, March 3 (Reuters) - South African gold miner DRDGOLD may have to mothball its entire loss-making North West mine operations if they fail to meet certain financial targets, the firm said on Thursday.
The company has been hit hard by a buoyant rand currency which cuts export income, since it has the most low-grade mines of South Africa's major gold producers.
"We are acutely aware that, in the event of failure to achieve these targets, placing the entire North West Operations on care and maintenance becomes an option we must consider," a statement said.
DRDGOLD shares, which have shed 35 percent this year, fell 5.45 percent to 5.23 rand by 1329 GMT.
Under "care and maintenance", production would be halted but infrastructure would continue to be maintained so that the mines could be reopened if the local gold price rises.
To keep the North West Operations open, productivity would have to increase by 35 percent and current working costs of 71 million rand a month would have to be slashed to 40 million rand, Chief Executive Mark Wellesley Wood said in the statement. The firm also said it had filed legal notices with trade unions about restructuring the mines.
In the six months to end December, DRDGOLD posted a net loss of 370.1 million rand, of which 75 percent was incurred by the North West operations.
"Currently, the North West Operations are losing some 20 million rand a month," DRDGOLD said.
Last week when interim results were released, DRDGOLD's auditor, KPMG, drew attention to the miner's weak financial condition, noting in its financial statements that current liabilities exceeded current assets at the end of last year. The company said last week the restructuring at the North West mines, which employs 5,613 miners, might take six months to a year and cost in the region of 30 million to 100 million rand. North West operations, consisting of the Hartebeestfontein and Buffelsfontein mines, accounted for 54 percent of the firm's South African output and 34 percent of total production.
-END-
Yep, Mr. Manuel, you are either a traitor or a dimwit. Most likely both.
Speaking of dimwits. Anyone left in the mainstream gold world that still doesn’t get it there is a Gold Cartel out there holding down the price ought to check himself, or herself, into the loony bin for a checkup.
The CRB rose again today. This time to 307.52, up another .87. Crude oil led the way, reaching $55 at one point before settling at $53.57, up another 50 cents per barrel. Pretty soon US commodity prices will make all-time highs with the gold price at HALF of its all-time high and THAT is with the central banks holding around 50% of the amount of gold they probably had when gold made that high in 1980.
Why gold HAD to be taken down today:
Fannie Mae faces up to $2.8 bln in new losses-WSJ
Thu Mar 3, 2005 01:17 AM ET
NEW YORK, March 3 (Reuters) - Fannie Mae (FNM.N: Quote, Profile, Research) may have to recognize as much as $2.8 billion in additional derivative losses because of new accounting concerns raised by its federal regulator, The Wall Street Journal reported in its online edition on Thursday, citing sources familiar with the matter.
The losses would be in addition to the estimated $9 billion in losses related to derivatives that the mortgage giant already has said it will recognize as it prepares to restate its financial results. –END-
Another reason why gold was not allowed to rise today:
WSJ's Heard on the Street: Tony hedge fund runs aground
Thursday, March 03, 2005
By Robert Frank, Wall Street Journal
PALM BEACH, Fla. -- A hedge fund that counted some of Palm Beach's richest residents as investors has shut down amid an investigation by the Securities and Exchange Commission and the Justice Department.
The hedge fund, called KL Financial Group, had assets of more than $200 million. It has told investors that it ran out of funds because of heavy trading losses, according to attorneys and clients involved in the fund. The SEC plans to file a temporary restraining order this week to freeze any assets left in the fund, according to people familiar with the investigation.
Officials from the Federal Bureau of Investigation started combing the company's West Palm Beach, Fla., headquarters this week to investigate whether any of the funds were improperly siphoned from the fund for personal gain.
-END-
Now, for a third reason the heinous Gold Cartel pounced on gold:
The oil move, of course.
How about a fourth reason? I can recall the days when pundits stated that once 1,000 US soldiers were killed in Iraq it would set of a firestorm among the American public:
3/3 BAGHDAD, Iraq (AP) - The number of U.S. troops killed in Iraq has topped 1,500, an Associated Press count showed Thursday after the military announced the deaths of three Americans, while car bombs targeting Iraqi security forces killed at least three people in separate attacks. –END-
AND, we can’t forget how the markets must reflect Alan Greenspin’s explanation of how the state of economic affairs really is in America. Having the price of gold embarrass him is NOT allowed..
Greenspan Walks Policy Tightrope
Peter Schiff
Archives
March 3, 2005
In early morning trading [Wednesday] the U.S dollar rallied in anticipation that Alan Greenspan's Congressional testimony would include an upbeat forecast for the U.S. economy and hope for a narrowing of its fiscal and trade imbalances. As should have surprised no one, Greenspan did not offer these soothing words, and the dollar's rally fizzled. Instead Greenspan delivered a sobering, yet still sugar-coated, assessment of the significant structural problems confronting the U.S. economy. Clearly, Greenspan has perceived the contours of the cliff over which the U.S. economy now teeters. His comments seem designed to allow him to claim "I told you so" when it finally falls off, without actually having to bear the responsibility for pushing it over the edge.
The following is a summary of some of his more interesting comments…
-END-
By the close gold and silver were slammed by the cabal. Nothing else matters, which is what I have been ranting about for years. It is also why Gold Rush 21 is so important. Your gold companies need an organization which will fight for their interests. There isn’t anyone else. The World Gold Council is just an extension of The Gold Cartel. Send GATA’s press release below to ALL your gold companies and call them about attending our coming historic international conference.
As for silver today, allow me to have a real pro explain specifically how The Gold Cartel crooks stole your money (if you are long) late in the day:
Bill,
I guess the cartel did everything they could today to keep the metals from going up through the roof. Silver on comex retraced a bout two thirds from yesterday’s upmove despite the strong oil price. My broker told me that some stops were triggered. From then onwards, silver firmed up again nicely. As we were approaching the close silver was trading at 7.34 in the may future contract when 2 minutes before the close "LIBO" entered the market sold 500 at 7.32 and offered 1000 contracts down to 7.30. that floor broker is acting for the big brokers. The rest was another chapter of the wall struck musical that repeats itself day by day…….it collapsed to 7.25…..what a colossal joke! The day is near when those dirty games will be over and those phony offerings will be simply taken out by real buyers and silver is exploding into the close, putting all those cartel agents against the wall. gosh – that cartel is desperate!
J.P
Another take on the same:
This is getting comical. Pulled silver up on my screen at 1:19 and the April basis was trading at 7.32. Look away for a second, look back and it gapped down on air to 7.26. No news no nothing. Gold was getting hit too. No news whatsoever. Then I pulled up the March $ index and saw that it was given a goose at 1:15. So obviously, in the absence of any news whatsoever and the highly visible presence of the price of oil on fire, the crooks goosed the $ in order to engineer a smack of the metals. When will this ever end. It is absolutely criminal.
Dave in Denver
The gold open interest rose 1520 contracts to 289,281 as The Gold Cartel continued to stuff any rallies. The silver open interest rose to 100,292 up 951 contracts.
The John Brimelow Report
Wed Open Interest + 2.1MM oz Gold down 70c Hmmm
Thursday, March 03, 2005
Indian ex-duty premiums: AM $6.18, PM $5.45 with world gold at $432.80 and $432.85. Ample and adequate for legal imports. At the close the rupee was knocked down to unchanged by abrupt Reserve Bank intervention: during most of the day it had been appreciably stronger. The Bombay Stock Exchange rose 1.46% to close at a record high: there is a substantial inflow of offshore portfolio investment funds at present. The pattern of foreigners buying Indian paper and Indians buying foreign gold seems likely to continue.
Japan does not care. Volume slumped 56% to equal a derisory 9,710 Comex lots, and open interest was static (up 273 Comex equivalent). The active contract was up 6 yen, and world gold stood 70c higher than the NY close at the end of the day, but TOCOM futures interest was clearly not responsible. (NY yesterday traded 48,072 contracts. Open interest rose 1,520 lots to 289,281.)
Interestingly, premiums on the Shanghai Gold Exchange have now risen to the $3.26-$3.49 zone. The only time they have recently been appreciably higher was at the bottom of downswing in world gold in April last year (when gold was $50 lower).
Stories today naively celebrating the WGC announcement that China’s gold consumption was up 12.8% last year demonstrate, when carefully read, how irrelevant China is to the world gold trade. The report claims that Chinese demand was 234 tonnes, but also discloses that domestic production rose 11.75% to 212.35 tonnes, meaning that the net role of China in the world gold trade would be negligible. (Of course, some might feel China’s sustained double digit increase in gold mine output over recent years questionable.)
Yesterday, a vigorous attempt to break gold down starting in the European day was rather summarily routed. Standard London reports:
"After the London market opened, gold was sold almost immediately by the European dealers… in spite of good physical demand nearer the 430’s, gold slipped easily beneath to touch the day’s low of 429.20 offer…dealers were duped into liquidating their longs and sold at the lows. With a sudden windfall of lower prices, physical demand kicked into overdrive and underpinned the market."
ScotiaMocatta’s take is:
"Gold started the New York session just below 430.00 but did not stay there for long as dealers bought substantial amounts shortly after the opening bell. Funds were seen in the market on the sell side, however, the dealers were happy to take whatever offers they could. Locals were finally forced to cover existing short positions causing a run up to the session high of 433.50/434.00"
In essence, short sellers were blocked by the trade - responding, no doubt, to orders from the physical market. (It will be remembered that the PM premium in India was particularly high).
Since last Wednesday, open interest has risen 21,421 contracts (8% - or 66.6 tonnes!). Gold lost 70c. Today dealers were muttering about a large Mine seller, although in this era of hedge reduction it is difficult to see that any producer would have flexibility in this kind of size. Yesterday’s Reuters story from London probably comes closer to the truth:
"Traders said gold had been pressured by selling from some of the major international banks, which some said was on behalf of funds, while others attributed it to producers and central banks." Of course, this inertia is in glaring contrast to the party going on in Oil products, the base metals and even grains. The Gartman Letter lectures this morning:
"One of the things we must learn about the commodity markets in the modern world of the hedge fund is that the billions upon billions of dollars thrown at them have changed the demeanour of the markets entirely…in the modern world, fundamental supply/demand figures can very can very much take the back seat to the power of funds trying to become invested. The funds are buying beans and to a smaller extent wheat as a "hedge against inflation," and due to their enormous size and the relative smallness of the grain futures markets their buying power has dwarfed the authority of the "trade interests" in the market."
Perhaps gold’s friends will get an unwelcome but interesting consolation prize in the form of a Gartman explanation of why this concept does not apply to gold (of which he of course is long).
Without the robust resilience of the physical market, of course, the divergence of gold would be even more startling.
JB
CARTEL CAPITULATION WATCH
The DOW continues to levitate, climbing 21 to 10,833. The DOG gave up 9 to 2058. Wall Street and investors are betting on a positive US jobs number tomorrow morning.
The dollar only rose .21 to 83.31, while the euro only fell .24 to 131.13.
US economic numbers:
08:30 Q4 Non-farm Productivity reported 2.1% vs. consensus +1.5%; Unit Labor Costs reported 1.3% vs. consensus 1.8%
* * * * *
08:30 Jobless claims reported 310K, in-line with consensus
Prior week revised to 311K from 312K.
* * * * *
10:00 ISM Non-manufacturing reported 59.8 vs. consensus 60
Prior reading was 59.2.
* * * * *
10:33 EIA reports natural gas inventories (107)bcf vs. consensus (115)bcf
For reference, year-ago data was (96)bcf. Prior week's data was (88)bcf. April natural gas futures are currently trading to $6.75/M btu in initial reaction.
* * * * *
While the spin re the US economy is awfully positive from the Wall Street crowd, not so from main street:
"CFOs express lowest level of optimism about the U.S. economy in nearly four years, according to a recent survey -- WSJ Optimism among U.S. chief financial officers fell to the lowest level in nearly four years, according to a recent survey."
