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CARTEL CAPITULATION WATCH
The DOW lost 38 to 10,178 and the DOG gained 3 to 1956.
The dollar closed at 88.29, down .25 and the euro rose .37 to 123.24.
More disappointing economic news:
10:00 Sept. ISM Non-manufacturing reported 56.7 vs. consensus 59 Prior reading was 58.2.
* * * *
Some input from Mexico:
Dear Bill:
Great news from Mozhaiskov, Deputy Chmn. B of Russia!
I remember that when the USSR collapsed, their gold reserves were: 2,200 tonnes.
Then, the number one man in charge of these reserves, was thrown out a window.
Next, the number two man in charge followed him out another window, in short order.
WHERE did the 2,200 tonnes go? Nobody seems to have followed up on this. Can 2,200 tonnes of gold disappear into thin air? Who got them and how?
Some brain should get to work on this extremely important mystery!
regards
Hugo
Food for thought:
Hi Bill,
In his speech, quoted on your website, Oleg Mozhaiskov, Deputy Chairman of the Bank of Russia, said:
Zitat"To earn some income on the stock and compensate for "book losses" caused by its revaluation, a number of central banks have started to place a part of their reserves into deposits with commercial institutions -- leasing operations. Data available to me suggest that these banks deposited about 1,000 tonnes in 1991, and 10 years later the volume of the deposits reached 4,800 tonnes. Naturally, the central banks' activity increased market liquidity and thus also put downward pressure on the gold price. "
ZitatThose are staggering numbers: gold leased to commercial entities in 1991--1000 tons; gold leased in 2000--4800 tons. Assuming a linear increase from 1991 through 2000, the average quantity leased per year for the 10 years would be roughly (1000 + 4800)/2 = 2900 tons, which gives a total outflow from central bank reserves over the 10 years of 29,000 tons! And that figure does not take into account the amounts leased prior to 1991, or the amounts leased from the end of 2000 through September 2004!
Bottom line: I think Mr. Mozhaiskov is hinting that virtually all of the central bank gold has already been leased out! No wonder the London Bullion Market Association tried to suppress his speech!
Mitchell Jones
More food for thought:
Good morning Bill
Interesting to watch the UK morning yesterday, it seemed as if there was a combined G9 effort to up stocks and the USD and sit on gold. All this filtered through to the US day.
What has been interesting is watching gold's retreats over the past month or so. Previously gold really sagged when hit, but now retreats are orderly and ground is not given up easily. Since Europe is a physical, rather than options, driven market, this must be costing the cartel dear.
As you know, I have been a long time follower of the gold market. In the early '90's I subscribed to a newsletter called "FullerMoney", which included gold as one of the markets analysed at that time. I still remember David Fuller's comment that gold follows real wealth creation and that ultimately a substantial portion of physical gold would go east. Not difficult to see what has been happening!
Last, but not least. Its not only the BLS that muddles the numbers, this from the 10/01/04 edition of Britain's "The Daily Telegraph (for those who don't know, NHS stands for National Health Service):
Chief statistician goes out with a bang
By Malcolm Moore, Economics Correspondent (Filed: 01/10/2004)
The head of Britain's much-criticised statistics office is to leave at the end of next year and return to New Zealand, it emerged yesterday.
Len Cook's departure from the Office for National Statistics comes in the middle of a restructuring that will move 600 staff, including his successor, to south Wales.
Len Cook outside the ONS
The need to overhaul the ONS was underlined yesterday as the body faced a grilling from economists in the City over its habit of heavily revising its figures. Mr Cook, 55, explained that "300 out of 400 systems" at the ONS were "obsolete". He added that two thirds of the investment in statistics during the 1980s was "wasted".
"You should have founded a statistical office in the 1960s rather than 1997, then maybe we wouldn't be in this state," said Mr Cook, a New Zealander, as he responded to criticisms over large revisions to GDP figures. He also had to defend the controversial way in which the ONS doubled its estimates for the output of the NHS shortly after the issue had been raised in a Cabinet meeting, and without telling anyone of its plans.
The Statistics Commission, which is responsible for inspiring public confidence in statistics, has attacked the move, and many commentators felt that Mr Cook had been forced politically to deliver a more buoyant view of NHS performance. Mr Cook said he shouldered the blame for the public relations disaster, and said he had indeed discussed making the changes with Sir Andrew Turnbull, the cabinet secretary.
Zitat"You would have called me piss-poor if we had not made the changes," he said.
Geoffrey Dicks, an economist at the Royal Bank of Scotland, said: "It does seem strange that the health figures are steeply revised by the ONS shortly after the issue has been raised in a Cabinet meeting, and that after the Bank of England publicly said it did not trust the first-quarter consumption figures the ONS then completely changed them."
Mr Dicks said the ONS paid barely any attention to the needs of the financial community when they "turned the figures on their head". He said that at an annualised rate, the first-quarter figures for household spending had been shifted from 0.3pc growth to 2.5pc and that the second-quarter figures had been revised down from 4.5pc growth to 2.4pc.
The ONS explained that by the time its first estimate of a quarter's GDP is released, it only had "limited data". Marian Bell, a member of the Bank of England's monetary policy committee, said ONS figures were "no less reliable" than those elsewhere in the world and the revisions were rarely because they had got the numbers wrong.
Charlie Bean, the Bank's chief economist, said that the ONS had been rated as "satisfactory" ever since the Bank's service level agreement had been introduced. He also defended the need for speedy, if rough, first estimates of GDP. Robin Youll, the statistician who is responsible for producing the first estimate, said: "The Bank would be happy if we produced an estimate of GDP every day."
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The gold shares roared back with the XAU jumping 2.47 to 102.26 and the HUI leaping 6.90 to 232.68, taking out Friday's close. Wonderful price action.
Today’s gold and silver comeback brings us into uncharted territory as far as the battle against The Gold Cartel is concerned. We know they are going to go all out to prevent gold from going to where it should, especially before the election. Whether they can pull it off is another matter. I certainly don’t have the answer. What I do know is the prices of gold and silver are going to go berserk; if not this month, next month, if not next month, by year end.
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GATA BE IN IT TO WIN IT!
MIDAS
Appendix
Hi Bill, here's a copy of my E-mail to the editor of the "washington post"
10/5/04 1:00:43 AM Central Daylight Time
Hello,
here in munich / germany, we remember the washington post for the courage to uncover a lying government and a lying president - watergate.
In these modern times, it needs russian sources to uncover the entire american media lying about the hidden and unconstitutional market manipulation going on in the US in totalitarian and fascist fashion, as back in times we know very well from Hitler and Goebbels in Nazi Germany.
Thanks to GATA, the rest of the world is better informed than the betrayed american citizen.
Shame on you.
Think about this. GATA cant get the WSJ, Washington Post, Barrons, Bloomberg to even mention the word GATA and the Russian Central Bank goes out of its way to not only mention GATA, it went way out of its way to provide us with an official English translation of Mozhaiskovs speech.(at the London Bullion Market Association in early June 2004)
It looks like this time someone needs to free the american people held hostage by a totalitarian government, that totally controls the "gleichgeschaltete" press.
Think about it!
K.B. Moellmann / munich, germany
Midas,
I did not have time to read this one yet. I was browsing the IMF site looking for some papers by one of Ben Bernanke's PhD students at Columbia Univ.. The paper confirms Jim Sinclair's position that Fed Governors think they can *effectively* talk up the economy . I am doubtful. Seems like that was the brilliant plan cocked up at the G-7 meetings. Can you imagine what the other nations economic minsters are thinking when the Maestro tells them about his ingenious plan to save the economy by "saying the economy is good."
But I digress. Here it the title of the paper I found followed by the link and then the abstract:
Central Bank Foreign Exchange Market Intervention and Option Contract Specification: The Case of Colombia
)