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

As this secular trend indicates, the dollar bear is certainly nothing new. While mainstream investors start paying attention thanks to the exploding news coverage of this long-underway event, contrarians and gold investors have already been earning big profits for years by betting with this primary trend. Indeed this dollar bear is one of the key components undergirding the powerful Stage One gold bull.

Interestingly, as contrarian theory predicts, the notoriety of the dollar bear is heavily dependent on its price. The dollar bear weighs heavily on investors’ minds when the dollar has been weak for a month or two and it trades near its lower support line rendered above. But once the dollar rallies back up towards resistance and has a strong month or two, the notoriety of the dollar bear evaporates like a desert mirage.

It is a natural human tendency to extrapolate immediate market conditions out into infinity. When prices rise people feel good and greedily expect farther rises. But when prices are falling people feel bad and grow fearful of additional drops. It takes a lot of time and effort to overcome this psychological tyranny of the present to develop a resolutely contrarian focus. Considering markets within their long-term contexts is an important first step.

The secular dollar bear shown above has had five distinct downlegs, including our current specimen. Each major downleg lasted several months or so and dragged the US Dollar Index down to fresh new bear-to-date lows. With the dollar breaking 85 in recent weeks we already have a marginal new low on this current in-progress dollar downleg. Peak to trough, the US Dollar Index has slumped 31% bear to date.

Interestingly though, even in light of the growing media frenzy surrounding the dollar’s latest slide, the currency doesn’t look anywhere close to carving a major interim bottom yet, let alone ending its secular bear. There are a couple key technical reasons that a major interim bottom isn’t likely here and many fundamental reasons why this secular dollar bear is probably not yet approaching its ultimate end.

As this chart reveals, major interim bottoms in the dollar, the kind that precede powerful multi-month bear-market rallies, generally happen only when the dollar is near its lower support line. The last two major downlegs, labeled 3 and 4 above, both failed to bounce higher until the dollar solidly slammed into its support. The downlegs before that, 1 and 2, didn’t travel quite as low but they still were in the lower half of the downtrend channel approaching support when they finally gave up their ghosts.

In contrast the dollar’s fifth major downleg today is nowhere near support. At best it is still in the upper third of the dollar’s downtrend channel, and it probably has to grind way down into the lower quarter or so of this downtrend in order to find strong enough support to attempt a major bear-market rally. As long as the US Dollar Index continues to trade high up in its downtrend near resistance like today, odds are we aren’t going to see a major interim bottom.

The Relative Dollar concurs with this simple trending technical analysis. Note above how the dollar’s black 200dma line runs parallel with the dollar’s downtrend channel. In any secular bear market, a price gradually marches lower by falling below its 200dma (a downleg) before periodically retreating back up to its 200dma (a bear-market rally). The red rDollar line precisely quantifies this key ongoing relationship between the dollar and its trailing 200dma.

So far in this dollar bear to date, major dollar downlegs have tended to end when the currency was trading between 0.90x and 0.92x its 200-day moving average. The first and fourth major downlegs both bounced when the rDollar hit 0.905. The third ground a little lower to 0.903 before soaring higher in a spectacular bear-market rally in mid-2003. The only major-interim-bottom outlier was the second major downleg which ended a bit higher at 0.922 in relative terms.

This remarkably consistent dollar-bear performance is the primary reason why I don’t consider a major bear-market rally to be highly probable until the rDollar trades under 0.92 or so. As this graph indicates, the lowest the rDollar has traveled so far in our fifth major downleg today is only 0.949 carved on November 5th. If the dollar was to turn around here and enter major bear-market-rally mode, it would be the highest such interim bottom in relative terms in this entire bear to date. While a major bottom here is possible, it is just not very probable in light of precedent.

Thus, from a pure technical perspective the dollar ought to head lower in the intermediate term before we see another major multi-month bear rally. The dollar will probably head down near its lower support line as well as slumping down under 0.92x its 200dma before today’s fifth major downleg fully runs its course. With its current 200dma, this would yield a major interim bottom in the US Dollar Index under 81, or at least 4% lower from here.

And if we consider fundamentals, the long-term outlook remains bearish just like the intermediate term. The goofy US Fed continues to create fiat dollars out of nothing at a relentless pace. As this printing-press inflation leads to relatively more dollars chasing relatively fewer goods, services, and investments, the value of the dollar falls. The Fed is also encouraging foreigners to sell dollars by keeping US interest rates artificially low to subsidize wanton American debtors. All of the Fed’s current policies are virtually assured to continue weakening the dollar.

Not wanting to be outdone by the Fed, the Washington bureaucrats are also doing everything in their power to weaken the dollar. The US government continues to spend far more than it can steal from Americans via brutally excessive taxation levels. The huge structural deficits Washington insists on running are eroding America’s credit and standing in the world. In addition, Washington’s newfound love of imperialism is spawning great antipathy worldwide. Until these fundamentals change, the dollar bear will likely remain in force.

Furthermore, in the past few decades secular bulls and bears in the dollar have tended to run for 5 to 7 years before maturing and reversing. Our current specimen remains quite young by this standard, barely three years, so duration precedent also supports the bearish fundamental outlook on the dollar in the years ahead.

In light of these intermediate-term technical and long-term fundamental situations facing the mighty US dollar, it looks like the dollar shorts still have the upper hand in probability terms. Yes, the dollar bear’s notoriety in the mainstream is growing, but apparently not enough mainstreamers are ready to put their money where their mouths are on this so far. The popular noise on the dollar bear ought to get a lot louder before a major interim bottom materializes.

In early 2004, near the last major interim low in the dollar after downleg 4, the raw level of dollar bear notoriety greatly exceeded what we have seen in the recent weeks. In early January I wrote, “The relentlessly plunging US dollar is the primary topic of some of the most widely played financial-news stories these days. This once mighty American currency is rapidly falling from international grace, and even conventional media outlets are focusing more and more on the enormous implications of the down-spiraling dollar. ... With the dollar’s plunge now headline financial and even general news across the globe, one of the most popular bets around these days is to short the US dollar.”

We haven’t yet reached the everyone-shorting-the-dollar stage this time around, but odds are we will before the fifth major interim bottom of this secular dollar bear is carved. When the growing media hype surrounding the dollar bear is eventually backed by a massive surge in dollar-short plays by Wall Street and the mainstreamers, then contrarians will really have to take note. For now though, this fifth downleg does not appear to be in jeopardy of spiraling out of hand.

With the probable intermediate and long-term scenarios addressed, that leaves the short-term. Our next chart encompasses just the past year or so, the small blue-shaded area in the lower right corner of the graph above. Interestingly, while the dollar looks bearish in the months and years ahead, the outlook over the next few weeks actually looks bullish.

[Blockierte Grafik: http://www.lemetropolecafe.com/img2004/Zeal111204B.gif]

Like pretty much everything else having to do with the markets, dollar sentiment is fractal in nature. In addition to episodes of popular bullishness and bearishness at the major interim tops and bottoms on a strategic scale, there are also miniature sentiment waves that cascade through the dollar over the short term. I suspect the current notoriety of this dollar bear is a product of a short-term sentiment wave rather than a long-term one.

In this tactical chart we can see the end of the fourth major dollar downleg and the beginning of the fifth. Just as general dollar sentiment was rotten and everyone was shorting in January (except us contrarians), dollar sentiment was positively glowing at the currency’s latest major interim top in May. I was watching this top very closely and went long gold stocks again after their early 2004 correction so I paid careful attention to what was said about the dollar.

After that May top, big Wall Street brokerages were predicting additional serious moves higher in the US dollar. I remember reading a couple reports calling for a target level of 100 in the US Dollar Index before 2004 ended. This dollar-bullish noise grew so intense and loud that even some analysts who usually traffic in contrarian circles were sucked in. To their credit the “contrarians” weren’t as bullish as Wall Street, but I saved contrarian newsletter reports from this summer calling for 95 to 96 in the dollar index by autumn.

Dollar bullishness also exploded again in late August as the dollar threatened to break out from both its short-term and long-term resistance lines. If you compare this tactical graph to the earlier strategic one, you will note that the dollar hugged both key resistance levels for a couple months. This was a particularly rough time for gold investors, as dollar strength usually translates into gold weakness. If I had an ounce of gold for every e-mail I received on this between late July and early October, I could start my own central bank.

The point of all these observations is to illustrate that the noisy majority is always wrong near market turning points. Dollar bears came out of the woodwork last January as bearish media coverage exploded, but they were wrong. Only contrarians predicted a major bear-market rally in the dollar. Similarly, in May and later last summer, dollar bulls multiplied along with bullish media coverage. Only contrarians predicted that the fifth major dollar downleg already underway would accelerate into autumn.

By the time any market event becomes mature enough or prominent enough to dominate the major news outlets, odds are that the vast majority of that move is past. If you buy when others are brave and sell when others are afraid like a mainstreamer, perverting Mr. Buffett’s brilliant advice, sooner or later you are going to lose all your trading capital in the markets. If you want to consistently win, you have to force yourself to adapt a contrary focus to mainstream investing popularity.

And this thought brings us to today. The intermediate-term and long-term outlook on the dollar remains bearish, but short term a bounce is certainly possible. By a bounce I don’t mean a massive multi-month bear market rally like the first half of 2004, but a sharp move higher over a couple of weeks or so. Two previous bounces are labeled above, in June and July, which each carried the dollar higher for a short spell.

Technical bounces are totally normal during major downlegs, they help bleed off temporarily excessive fear and rebalance sentiment. Today’s soaring media coverage and the resulting growing notoriety of the dollar’s weakness is both a result of growing fear and a catalyst for even more fear. Unless the dollar bounces briefly, fear could get out of hand. Bounces solve this sentiment problem.

These technical bounces generally occur when the dollar hits its tactical support line, just as it did in June and July before the previous two bounces. As you can see in this chart, the US Dollar Index just slammed into this same support line again for a third time in early November, and a minor bounce may already be in progress.

If this fairly-high-probability bounce indeed materializes in the coming weeks, it could carry the dollar back up as high as 86+, up to the same upper resistance line at which the currency lingered last summer. But, even if the bounce does run all the way back up through the dollar’s tactical downtrend channel, odds are it will be short-lived. With strongly bearish intermediate and long-term outlooks, any dollar strength on a minor technical bounce will probably be fleeting at best.

The bottom line is the dollar bear’s notoriety is growing, which naturally causes concern among contrarians. A contrarian wants to buy when others are afraid and sell when others are brave, so contrarians short the dollar today are wary that the mainstream is growing too fearful of the falling dollar. But, thankfully for contrarians, the technicals and fundamentals only seem to support a short-term dollar bounce at best, not a major bear-market rally and certainly not the end of the dollar’s secular bear.

If you are interested in trading this potential dollar bounce, please consider subscribing to our acclaimed Zeal Intelligence monthly newsletter. In the current November issue I discuss how we are planning on playing a dollar bounce in terms of the primary beneficiaries of dollar weakness, gold stocks and gold-stock options.

While such a minor dollar bounce would probably hurt these speculations short-term, it would create some excellent buying opportunities if the dollar does head up to its own resistance for a short time. We are currently screening various gold-stock options as well as junior gold miners for potential purchase if the dollar does indeed challenge its resistance again before its downleg resumes in earnest. It would create the first good buying opportunity for leveraged gold plays since last summer.

Our subscribers also have exclusive access to a new subscriber-only charts section on our website, which among dozens of other charts includes a high-resolution Relative Dollar chart updated at least weekly so you can monitor the ongoing progress of this major dollar downleg. This is especially important for gold investors since gold’s next major correction will probably commence the moment this fifth major dollar downleg ends.

The dollar bear’s notoriety is certainly growing, but so far the popular fear doesn’t look great enough to do anything besides spawn a minor dollar bounce at best. Contrarian investors and speculators directly or indirectly short the dollar probably have nothing to fear in the intermediate and long-term time horizons.

Adam Hamilton, CPA

November 12, 2004

So how can you profit from this information? We publish an acclaimed monthly newsletter, Zeal Intelligence, that details exactly what we are doing in terms of actual stock and options trading based on all the lessons we have learned in our market research. Please consider joining us each month for tactical trading details and more in our premium Zeal Intelligence service at … http://www.zealllc.com/subscribe.htm

Questions for Adam? I would be more than happy to address them through my private consulting business. Please visit http://www.zealllc.com/financial.htm for more information.

Thoughts, comments, or flames? Fire away at zelotes@zealllc.com. Due to my staggering and perpetually increasing e-mail load, I regret that I am not able to respond to comments personally. I will read all messages though and really appreciate your feedback!

Copyright 2000 - 2004 Zeal Research (http://www.ZealLLC.com)

@ Schwabenpfeil, Silbertaler, u.a.

Vielen Dank für Eure Mühen, natürlich ist es ruhiger im Board geworden, aber es gibt sicher viele wie mich, die es kaum schaffen alles zu lesen, geschweige denn selbst noch Beiträge zu liefern.

Macht bitte trotzdem weiter !!!

Auszug aus dem Tageskommentar Pro Aurum 15.11.:

Die physische Nachfrage hat sich am Freitag sprunghaft belebt. Gesucht wurden vor allem Goldmünzen 1 Unze Krügerrand und Maple Leaf. Bei den Goldbarren waren die Gewichtseinheiten 100 Gramm und 250 Gramm die Umsatzspitzenreiter. Das Volumen stieg im Vergleich zu den beiden vorangegangenen Tagen um mehr als 150%. Das Verhältnis von Kundenkäufen zu Verkäufen betrug weiterhin drei zu eins. Einige institutionelle Kunden fielen hierbei durch größere Verkäufe auf.Das Silber konnte ebenfalls zulegen und überwand die Widerstandslinie bei 7,57 US$ pro Feinunze knapp. Auch hier stehen die Ampeln derzeit auf grün. Die nächsten Widerstände haben wir bei 7,68 US$ und 7,75US$ ausgemacht. Die physische Nachfrage konnte sich auch hier beleben.

PEIXOTO DE AZEVEDO, im November. Der vierzigjährige Lenilton war immer einer von den Kleinen, und er hat ganz klein angefangen. Als er 1987 aus Südbrasilien hierher kam in die Goldgräberstadt Peixoto de Azevedo, die damals ein Zehntel der gesamten brasilianischen Goldes erzeugte, da wollte er erst mal nur eins: Abhauen. "An meinem ersten Tag in Peixoto sind drei Leute umgebracht worden, aber dann habe ich mir gedacht, dass nur der stirbt, der den Tod sucht", sagt Nilton. Und weil er so eine schöne Schrift hatte, fing er als Kassierer beim illegalen Glücksspiel an, bevor er in den Goldankauf überwechselte, später zehn bis zwanzig Kilo pro Monat vermarktete und schließlich Riesenverluste machte.

Vor zwölf Jahren war Schluss, zwölf Jahre, das ist wirklich keine Zeit, und trotzdem hören sich all die Episoden aus der Zeit des Goldfiebers so an, als sei das alles ewig her: Der Goldgräber, der immer ein Taxi für sich und ein zweites für seinen Hut nahm. Die Spelunken, in denen die Garimpeiros pro Nacht und Nase hundert Gramm Gold ausgaben. Der Autobesitzer, der grundsätzlich Mineral- als Kühlwasser verwendete. Die legendäre Hure Jacqueline, die es pro Nacht auf 500 Gramm brachte und alles in Mietshäuser anlegte. Die Flugzeuge, die damals das Bargeld nach Peixoto de Azevedo brachten. Die Hinterhältigkeit, mit der den Goldtauchern die Schläuche durchgeschnitten wurden. Und die tödliche Krankheit namens Balaria, die damals grassierte - die Kombination aus Malaria und Ballerei. Soll das wirklich erst zwölf, fünfzehn oder zwanzig Jahre her sein?

Malaria und Tripper

Peixoto de Azevedo ist vermutlich die einzige Stadt weltweit, die erst 25 Jahre alt ist, aber schon ein historisches Zentrum besitzt. Das ist natürlich ein großes Wort für die Atmosphäre hoffnungslosen Verfalls, die sich in der Rua do Comércio und den paar Seitenstraßen breit macht, in denen es früher Bars und Bordelle, Diskotheken und Nachtlokale zu Hunderten gab, außerdem jede Menge Goldaufkäufer. Und vor allem Apotheken, wegen der Malaria und dem Tripper. Nicht einmal der Abglanz der früheren Glorie liegt heute über dem ehemaligen Zentrum: Von fünf Läden haben vier die Rollläden für immer heruntergelassen.

Anderthalb Tonnen Gold pro Monat wurden hier einmal umgeschlagen, aber das Gold, sagt Nilton, "bringt keinem Glück". Ihm jedenfalls hat es keins gebracht, und der Stadt auch nicht, die früher einmal das zweithöchste Steueraufkommen im Bundesstaat Mato Grosso hatte. In ihren besten Zeiten wohnten in der Goldgräberstadt an die 100 000 Einwohner, im vergangenen Jahr waren es noch 22 747 Menschen im Munizip Peixoto de Azevedo - auf einer Fläche fast so groß wie Schleswig-Holstein. Die hohen Energiekosten, die niedrigen Weltmarktpreise, die Folgen der Wirtschaftsliberalisierung Anfang der Neunziger - das alles kam zusammen, und so wurde Peixoto 1992 in ein paar Monaten vom Goldfieber kuriert.

Und jetzt? Was Peixoto am Leben erhält, ist die Landwirtschaft. Tropen so traurig, wie sich wohl auch der französische Ethnologe Claude Lévi-Strauss nicht vorstellte, als er in den dreißiger Jahren durch Mato Grosso zog: Wenn man die Stadt Peixoto verlässt, fährt man endlos durch eine zersetzte, zerwühlte, zerstörte Landschaft. Die nächste Phase der gewaltsamen Ausbeutung der Natur liegt förmlich in der Luft. Wie Novembernebel legt sich der Rauch der endlos brennenden Rodungen vor die Sonne. Unbekümmert lassen sie die angekohlten Stämme einfach stehen. Den Rindern ist es egal, dass das traurig aussieht, und den Menschen auch. Fleisch, darauf gründet sich Peixotos Gegenwart. Und auf die Edelhölzer, die in den riesigen Wäldern eingeschlagen werden.

Vielleicht wird ja auch alles wieder anders mit dem Gold. Luiz Alberto de Jesus, den sie in Peixoto alle Nenê nennen, ist davon überzeugt. Er ist der Besitzer der Firma Ouro Sharp - "Sharp, so wie der Taschenrechner" -, einer von fünf Goldaufkäufern, die sich in Peixoto noch halten können. "Das mit dem Gold ist nicht vorbei. Was sich ändern wird, ist nur die Art, es zu gewinnen", sagt er, "was wir brauchen, sind Investitionen". Luiz Roberto Campos, ein anderer Goldhändler, teilt die Zuversicht. Sicher werde nicht noch einmal so ein Goldfieber ausbrechen wie 1979, als jede Woche Hunderte von Menschen aus ganz Brasilien in Peixoto ankamen. Aber dass Großunternehmen mit viel Kapital und hohem Maschineneinsatz in den Untergrund vorstoßen, das hält Campos für wahrscheinlich. "Und dann", prophezeit er, "gibt es wieder Handel in Peixoto, und Geld und Jobs".

"Noite negra", schwarze Nacht, heißt das Lokal des Transvestiten Nashi, die abends die rote Birne anschaltet und in schwarzglitzerndem Trägerkleid auf Kunden wartet. Das Lokal hat Nashi günstig gekauft, also will sie bleiben. Sie hofft auf bessere Zeiten. Die blonde Vânia träumt dagegen vom Weggehen. "Hier ist nichts mehr los. Aber in Novo Progresso, da gibt es Farmen, da gibt es Gold, da hast du an jeder Ecke eine Nummer", sagt sie. Novo Progresso liegt ein paar Hundert Kilometer weiter nördlich. Vorher kommt noch Castelo dos Sonhos: Schloss der Träume. Als wären sie erfunden, diese Ortsnamen. Aber das sind sie natürlich auch.

[Blockierte Grafik: http://www.sueddeutsche.de/img/g_sz_logo.gif]
Deutschlands geheime Währung
Die Schatten-Mark
Parallel zu den offiziellen Zahlungsmitteln hielt die Bundesbank jahrzehntelang ganz diskret Ersatznoten bereit — warum, ist bis heute unklar.
[Blockierte Grafik: http://www.sueddeutsche.de/wir…/42957/image_fmbg_0_4.jpg]
...
In der Tat waren die so genannten Bundeskassenscheine niemals gültige Zahlungsmittel. Dennoch wurden sie in der Nachkriegszeit in offiziellem Auftrag hergestellt -- warum und unter welchen Umständen dies geschah, ist allerdings seit Jahrzehnten geheimnisumwittert.
...
Aus Walz' Sicht gilt als sicher, dass es seit den sechziger Jahren eine Serie aus Geldscheinen parallel zu den offiziellen Münzen und Banknoten gab. Sie sollte im Notfall die umlaufenden Ausgaben rasch ersetzen, etwa bei einer Bedrohung der Bundesrepublik durch Staaten des Warschauer Paktes.

"Man stellte sich beispielsweise vor, dass der Ostblock versuchen könnte, die DM durch Falschgeld zu destabilisieren", sagt Walz. In diesem Falle hätte man die umlaufenden Stücke und Scheine für ungültig erklären und die Ersatzserie ausgeben können.

Mangel an Münzen

Auch gab es wohl das Szenario einer Hyper-Inflation wie im Jahre 1923, als ein Währungsschnitt und die rasche Ausgabe neuer Zahlungsmittel nötig wurden.

Ein Vorrat sei in solchen Fällen durchaus sinnvoll, meint der Experte. "Üblicherweise dauert es Jahre, bis eine einigermaßen fälschungssichere Serie hergestellt ist."

Die Bevorratung von Scheinen anstelle von Kleingeld geschah offensichtlich auch aus der Erfahrung heraus, dass in Krisen- und Kriegszeiten oft ein Mangel an Münzen herrscht -- zum einen, weil die Bevölkerung sie hortet, zum anderen, weil sie wegen ihres Metallgehalts eingeschmolzen und für andere Zwecke verwendet werden.
....
http://www.sueddeutsche.de/wirtschaft/artikel/984/42942/

Gibt es schon einen Schatten-Euro für eine Währungs“reform“?

ich dachte es wäre umgekehrt, habe vor kurzem irgendwo gelesen dass deutsche bomber über england pfundnoten abwarfen um das gleiche zu erreichen aber es hatte damals nicht so richtig funktioniert.
aber es wird wohl bei jedem krieg in erwägung gezogen, staaten können die scheine von fremden staaten bestimmt besser fälschen als die blütenmafia.
eine hochinteressante und sehr wirkungsvolle waffe, und dass auch noch ohne tote.

Habe den Link leider nicht mehr, aber anscheinend gaben ein paar Bankautomaten der HVB und anderen Euro-Blüten aus... ist jetzt vielleicht 4-6 Monate her dass ich davon auf spiegel-online gelesen habe.

Achja, und anscheinend werden die Euro-Blüten immer besser. Fast nicht mehr vom Original zu unterscheiden.

Zitat

Original von midas

Vielen Dank für Eure Mühen, natürlich ist es ruhiger im Board geworden, aber es gibt sicher viele wie mich, die es kaum schaffen alles zu lesen, geschweige denn selbst noch Beiträge zu liefern.

Macht bitte trotzdem weiter !!!

Hallo midas,

klar machen wir weiter. Schliesslich ist uns das Forum hier "ans Herz gewachsen" ...

Gruß
Schwabenpfeil

November 15 – Gold $436.50 down 90 cents – Silver $7.53 down 6 cents

Harry Potter Wows ‘Em

"There seems to be a correlation between the intensity of the official attacks on gold and the severity of monetary crises." Hans F. Sennholz

Just walked in the door from New Orleans. Was a wonderful GATA success in the Big Easy. More below.

Out of the loop today, so my report will be from what I have been told and from what I see. It seems rather extraordinary.

Last night the GATA gang was hanging out at the Sheraton Bar before heading out to dinner and gold was up $1.40 with the DEC contract ready to take out $440 and the reported stops above that level. We should have taken a picture then of the price and called it a day (for the next 24 hours). That was about the best gold was going to do with the bums going into action. DEC eventually did take out $440, however the resulting commotion was a wasn’t. Down she went instead of up, thanks to Goldman "Hannibal Lecter" Sachs and friends.

However, what is most striking is how quiet the day was with gold at 16-year highs. Most markets become very volatile when they break into such significant new high ground like gold just did. Instead, gold went comatose. Yes, the dollar put in a rally to quench the gold action. However, we know this is how The Gold Cartel has used the dollar to keep gold from creating excitement around the world in other currencies. At some point in the very near future, gold is going to break from the dollar due to the very firm physical market.

Here is a shocker. The DEC gold and silver open interest went up on Friday with a little more than a week left before first notice day. The DEC gold contract rose 1868 to 247,907, with the total open interest rising 4195 contracts to 347,209. With so few days left before first notice day, one would expect the DEC positions to be contracting by now with new buyers going into FEB. Ain’t happening like it normally does.

The same with DEC silver. It rose 269 contracts to 86,155. The total silver open interest went into new high ground at 123,078, up 566 contracts.

Not sure what it means yet. However, it is potentially explosive should a number of the Dec longs ask for delivery. I am not hearing any talk about this, which what may be the most bullish factor of all. Time will tell here. Any kind of delivery squeeze is a long shot, yet could happen if someone decides to take what’s left of the visible silver supply. Have to stay all over it.

One thing which really struck me at the New Orleans conference was the amount of SHORT-TERM bearishness. There were way more bears there than bulls. Yes, most everyone was bullish in the long term, but most felt gold would be dumped first. Then, there was never admit your wrong Robert Prechter who is still big time bearish. I consider him now to be an embarrassment. Years ago, he said if gold took out $376, he would turn very bullish, looking for gold to take out $1,000 per ounce.

Goldman Sachs was talking up the bear case today on the Comex and was CONSPICUOUSLY seen putting on PUTS. As reported in this column lately, they have been a noticeable seller of late on behalf of The Gold Cartel.

The GATA crew is a bunch of independent thinkers. Mike Bolser, Catherine Austin Fitts and Frank Veneroso are short-term bearish. James Turk and I are bullish. At least one of our group will be correct.

The silver warehouse stocks dropped to 102,182,715 on Friday, a new low for the move.

The dollar went up by .34 to 84.05 with the euro falling .42 to 129.43. Oil tanked to $46.87 per barrel – inflation bearish, but Indian gold demand bullish.

HOW ABOUT THAT CRB!!!! It erupted to 287.38, up 4.09. Coffee went bananas. Cocoa lifted nicely and the grains have caught a bid. It is only 2 points from making a new high and this is with oil having dropped close to $10 per barrel. Deflationists won’t like this development.

The New Orleans conference was a big winner for GATA. Kathleen Steer, Ed’s gorgeous daughter (The GATA Girl), manned our booth most ably and outshined all of the Dines’ Birds. Look for a repeat in Vancouver on January 22 if we are lucky enough to corral her again.

Chris Powell was awesome in his organization of GATA’s activities. He received many kudos from different quarters.

The GATA luncheon to wrap up the conference was a huge success. When we walked into the setting, it looked like a G-7 meeting the way the head table was elevated in this huge ballroom with sky high ceilings and a view overlooking the Ponchetrain River.

We had 90 people show up with little promotion. Great crowd. Two billionaires along with the very special Richard Olsen, a New Jersey mechanic, who flew 4 of his sons and brothers in laws in from all over the country to attend the luncheon because Richard believes what GATA is doing is that important to our country.

You don’t find more top notch people than these attendees either:

*Sprott Asset Manager CEO John Embry
*Former Harmony Gold chairman Adam Fleming – now chairman of Wits Gold in South Africa
*Don Doyle, CEO of Blanchard Coin, who is doing an incredible job of suing JP Morgan Chase and Barrick Gold on charges of gold price manipulations.

Dan Norcini was a hoot as was Wistar Holt and his sidekick Charlie of Holt & Shapard Capital Management.

Candente, Samex, and Klondike Star were ably represented.

Nanik Daryanani flew in from the Canary Islands.

On the dias, my mentor Frank Veneroso shook up the attendees with a GATA related spook story – making me look toned down when it comes to the conspiracy stuff. Catherine Austin Fitts was her dazzling self. James Turk made some news about what the ETF's coming on stream may really be about. Ed Steer spoke eloquently of his grandfather fighting for freedom and why he signed up with GATA. Unfortunately, Mike Bolser had to leave early to catch a plan as did Reg Howe and Bob Landis. Then, there was GATA’s "Harry Potter," Andrew Hepburn, who co-wrote Sprott Asset Management’s publication, "Not Free, Not Fair: The Long-Term Manipulation of the Gold Price," along with John Embry. Harry is about 5’ 4" and looks much younger than he is, a mature 20.

From the elevated head table, I could see the attendees all begin to lean forward to listen this college junior. Cool as a cucumber, Andrew delivered a brief presentation with the savoir faire of an elder statesman and delivered the line of the entire conference as far as I am concerned. Went something like this:

The intellectual capital of the gold world is in this room – referring to Frank Veneroso, James Turk, John Embry, Adam Fleming (Reg Howe and Bob Landis), etc. Most of the other gold output out there is all drivel.

None of us have seen anything like Andrew. The next thing I know the very clever Joe Martin, who runs the superb Cambridge House gold conferences in Canada, was talking to Andrew about a speaking appearance.

My colleague Chris was his usual entertaining self.

I rapped it up with some mention of the GATA prints and what the GATA painting represents. We sold 10 at the conference and there are only 46 left out of the 300 limited edition printing. When we are down to 30 the price is going up to $1,000, as has been planned all along. They are $750 now plus $25 for shipping. For new Café members, the work of GATA artist Alain Despert is selling very well at $5,000/$8,000 a pop in Bora Bora See http://www.despert.com. When the gold market goes nuts and the GATA story breaks, these prints will be a part of US history. If any of you would like one, contact Chris Powell at GATAComm@aol.com. Just remember, when they are sold out you will only be able to own a print if one of the 300 wants to sell.

The John Brimelow Report

JB: Bears flunked today? Interesting Bianco

Monday, November 15, 2004

Indian financial markets were all closed today. So were all markets in the Muslim world, including the Gulf, Turkey, and Singapore. This was therefore the easiest day for the Bears to counter-attack significantly. They have not done much.

Although trading in the rupee is thin on such a day, Reuters did show it below $1 = R45 a couple of times, a new high. Since the Indian currency tends to move inversely with the oil price, the oil slide since India closed early on Thursday NY time is likely to see a firm rupee tomorrow, bolstering gold imports. Most commentators still assume that weak oil means weak gold: this is an obsolete thought now that India is so important to gold.

TOCOM gold was very quiet today, with the strong yen playing its usual discouraging role. Volume dropped 31% to only the equivalent of 12,223 Comex lots, but open interest did edge up again, by the equivalent of 720 Comex, to 105,595 NY equivalent. There was some talk of Japanese speculators coming into precious metals from Oil, but platinum seems to be the favoured vehicle. (NY on Friday traded a robust 64,414 lots: open interest rose another 4,326 lots – 13.45 tonnes – to 347,340, yet another record.)

Currently the Bears are alleging front running of the ETF as the reason for gold’s strength, with the brightest spokesman pointing out that the Hirohito Coin 600 tonne buy order in mid 1986 caused a period of strength which puzzled many. He fails to point out that the peak in Fall that year, just over $440, was easily surpassed in 1987 which saw gold much higher most of the year, ultimately clearing $500.

Bianco Research put out an interesting note on Friday, puzzling about the contrast in the big reduction in Mine hedging recently reported, and the behavior of the CFTC data (the study of which they to a fair degree pioneered).

"The de-hedging trend is not supported by the CoT chart..The Commercials/Hedgers…have been moving shorter and shorter for many months and are now near their most extreme position in 12 years. This suggests that hedgers have been selling more futures contracts in recent months - not reducing their hedging. We cannot explain the difference between these two measures. If anyone has any thoughts/explanations, please pass them along."

Of course, mines are not the only commercials in gold – there are fabricators – but that this discrepancy should puzzle this highly experienced Commodity outfit is notable. (See attachment. Scroll down for charts.)

While waiting for the physical market to squeeze the Bears again, it is worth contemplating The Privateer’s massive $US 5x3 point and figure chart, which has decisively rejected a triple top (second attachment).

JB

[Blockierte Grafik: http://www.lemetropolecafe.com/img2004/privateer.gif]

[Blockierte Grafik: http://www.lemetropolecafe.com/img2004/bianco.gif]

CARTEL CAPITULATION WATCH

The DOW just keeps on rising – to 10550, up 11. The DOG jumped another 9 to 2094.

02:39 Euro zone finance ministers expected to agree to continue to talk down Euro reports the WSJ
The agreement is expected at today's regular monthly meeting. In recent days officials have denounced the sharp rise in the Euro versus the dollar and blame the large U.S. budget deficits for the move.
* * * * *

Lois Ringel notes:

Quite a bit different from what I hear on CNBC Europe this morning..Consensis from pundits there felt that nothing would be done..also mentioned that Trichet's comment of "brutal" in regards to the strength of the Euro was not translated correctly, and that in French that translates into "sudden"...amazing the difference in the European channel versus ours... ***

Chuck checked in earlier:

NO sounded great. Either during this lift in the dollar or right at the end of move, we should start to see the real move in the shares and the metals. It needs to come out of great skepticism and there are too many people who have learned to connect the dots with a falling dollar. A rising dollar will perplex them. This stock rally is about toast. A strong dollar will trigger selling. Hoye is looking for 10,600 and then the decline. Could have a little pain this week. Chuck

Wake-up Call Time:

Fed's Gramlich Urges Fix for Budget Gap

By Poornima Gupta

ANN ARBOR, Mich. (Reuters) - U.S. budget deficits pose a problem for both the domestic and world economies, but there seems little political will to fix them, Federal Reserve (news - web sites) Board Governor Edward Gramlich said on Saturday.

"We have big deficits now and the politics of deficit reduction, if you want to call it that, are terrible. If you even dare talk about raising anybody's taxes, that's political death," Gramlich said in a speech at the University of Michigan.

"In 10 years when the huge baby boomer cohorts begin to retire, we will really have problems," he added, saying the national savings rate was at a record low and would only weaken further when demographics shifted.

"This is a significant problem," he said.

Gramlich urged a return to the budget limits of the late 1990s that have since expired. "I thought that was quite successful," he said.

The Fed governor said many Asian countries, particularly Japan and China, are fueling their export industries by supporting the dollar and keeping their own currencies cheap.

"How long can they do that? If they begin to have inflation in their own countries, which is getting close in China, they are going to probably have to stop," Gramlich said.

"So we have a pretty unstable world situation ... right now," he said.

The route to stability is through faster growth in the domestic economies of U.S. trading partners, coupled with an increase in the U.S. savings rate.

"The way to get our saving up is by reducing budget deficits. I personally would like to see us get back to something like a balanced budget as soon as we possibly can," Gramlich said.

The Bush administration has pledged to halve the shortfall, which hit a record $412 billion in fiscal 2004 ending Sept. 30, over five years through spending controls and economic growth.

However, concerns that the budget gap -- and U.S. trade shortfalls -- will grow further in a second term for President Bush (news - web sites) have exacted a heavy toll on the U.S. dollar in recent days.

European officials, worried about the drag a soaring euro will create in their economies, are expected to raise the issue next week with Treasury Secretary John Snow at a meeting of finance chiefs from the Group of 20 wealthy and emerging economies in Berlin.

"Foreign countries will have to stop trying to stimulate themselves by exports ... and stimulate their domestic demand. This would all possibly have to be worked out internationally," Gramlich said.

"But I think there is a way out of it. It involves fiscal austerity for the United States and it involves demand stimulation for the rest of the world," he added.

-END-

From Derek Van Artsdalen in San Antonio:

Howdy, Bill--
Just a snippet for "Midas" tonight.

I think your readers may find it interesting that exactly 25 years ago today, on November 15, 1979, the price of gold was only about six weeks from the start of its tremendous blow-off stage. That price explosion lasted just a few weeks, and gold eventually peaked around $875 per ounce ($850 on the London PM fix) in the third week of January 1980. For the record, the official London evening fix on this day in 1979 was exactly $386.00.

Here's the interesting part: this evening's London PM fix of the gold price was $437.60. That is, surprisingly, nearly 14% HIGHER than it was during its historic run 25 years ago!

Now, don't get me wrong. Given the price-capping antics of the cartel thugs, I certainly don't expect gold to blast off to eight or nine hundred bucks an ounce in the next two months (although anything is possible).

On the other hand, neither do I believe that such a short-lived run-up is likely this time around. In fact, we gold bugs have every reason to think that gold will—with periodic healthy corrections, of course—remain in a powerful overall uptrend for many years. The main point is that perhaps the gold cartel has far more reason to be nervous than we previously imagined...
Regards,
Derek

A little food for thought:

Hello Bill,
I’m often accused of being nuts, but I bought gold shares for pennys and there worth 10 bucks now. When the us dollar plunges and gold gets wild where will salt be? I work at a salt plant in northern Alberta owned by rohm-haas , the plant is 50 years old and is a beat-up, rundown piece of junk,,,, but,,, head office is now all of a sudden excited to re-build it. Very strange turn-around in behavior.
Brent Mosley

John Mauldin, a nice fellow, got me going with his comments last week. He openly says the currency markets are manipulated. Then, he pooh-poohs GATA. Makes no sense.

DailyReckoning.com
Wednesday, November 10, 2004

http://www.dailyreckoning.com/…dy_index3.cfm&qs=id=10759

……..Secondly, we should take note that currencies are the one market in the world where profit is not the end game. In stocks, bonds, commodities, real estate, and anything else that moves, the object is to make a profit.

Currencies are a manipulated market. They are manipulated by the central banks of sovereign nations, which make decisions about what the level their own currency should be for the own economic and political purposes. That makes them volatile and very difficult to predict in the short term…

-END-

From the horse’s mouth – a veteran Café member and first rate geologist to another Café member, Eric Hommelberg:

In a message dated 11/14/04 10:46:03 PM Central Standard Time, writes:

I'm the geologist friend of Bill Murphy who wrote to you earlier, about the reserve replacement problems that the majors are facing. I can give you a first hand update, again, with some fresh new ideas.

I worked for Homestake for 5 years, for Barrick for 5 years, and much of the rest of the time for small companies. In 1998, the companies started laying off geologists, steadily and more each year. This continued through 2002. At that point, the bottom of the gold market, they thought they had it made in the shade. What they didn't realize at that time was that they had lost much of the cream of the industry, since they were very picky about hiring the best people in the industry to start with. At the bottom, of course, they realized that soon, if the market recovered, that they were going to have to rehire geological and engineering staff. The only problem was that many of these people retired and took city jobs at Home Depot, with the government, etc. These people were out of the market. The companies could not find top notch people to hire.. The gold price started to move up, and went up steadily (the breaking of the "cup and handle" pattern). The big companies gave a weak effort trying to find new employees, at sub-par salary levels (e.g. Newmont Elko). The gold price kept going up, and,,,,, all of a sudden,,, there was a new force in the market. Junior companies.

Now something unexpected happened, the Juniors started stealing the remaining top level geologists that the big companies had, such as Alan Branham (Midway Gold) and Marcus Johnston (Victoria Resources) of Newmont. Even Barrick just lost one of its top two mine geologists at Goldstrike to a barite exploration company! Another large company has hired geologists from peripheral government staffs to make up a shortfall.

Right now, the majors are faced with in-house staffs of declining quality, in a market that demands that they hire more top quality geos to replace their declining ore reserves. They can't compete with the juniors, who pay higher salaries, give more stock options, and have better work positions to attract new people with. In the meantime, the juniors will continue to steal the remaining good big company geos! In this no-win scenario, the major companies, especially Newmont and Barrick, will be forced to look to juniors mto acquire the exploration opportunities that they themselves will not be able to find or explore for. It is a supply-demand situation that the majors cannot win.

As a biased aside, Eric, I've just started up a new junior exploration company that will focus on Nevada and Mexico world-class opportunities in gold and silver. We're being underwritten by Haywood and Wolverton, and will come out of the gate with 3 good properties: 1) Chuchu-Estrella, Mexico (see my website at http://www.rmicgold.com ) , 2) Poker Flats, Nevada, which is located immediately adjacent and on strike with Newmont's new to be constructed Emigrant Springs Mine, and 3) a good property located next to the Round Mountain Mine, which has potential for high-grade silver and gold veins as well as a bulk-tonnage Round Mountain-analog target. Mexivada will also look for any world-class opportunity available, around the world, and I have contacts everywhere. I'm presently trying to horn in on a world-class gold/diamond target in an unexplored place in the world, unknown to big companies, which would open the eyes of investors around the world. We're aiming toward a public IPO on the TSX-V in the first quarter 2005, and now are going to start off with a 3-4M share private placement at C$0.30 (with a half warrant attached), and then do the IPO at 50c. The publicity will be augmented by founding partner Michael Schaefer of the Secret Stock Files, who has a large coterie of eager investors. Haywood is taking half the 30c offering, and Wolverton also will take a good chunk. If you two gentlemen would like to participate, I'll arrange to save you a block of shares each.

Thanks for listening!

Best regards, Rick Redern
rmicgold@frontiernet.net

The gold shares continue to stink up the place. The HUI can’t stay above 240 for anything. It fell 4.90 to 236.96, while the XAU lost 1.50 to 107.09.

One other key point which caught my attention in New Orleans was how $400 gold doesn’t cut it any more for strong gold company profitability. Costs have risen too much. In general the industry now needs $450+ gold.

Anyone can see how hard the corrupt Gold Cartel is doing what they can to keep gold from going to where it ought to. They have convinced most of the gold world they are going to win again – that gold will tank and the specs will be trashed.

As mentioned $15 ago on the downside, seems too pat to me. Too many bears out there. Last year at the NO conference, bulls were everywhere. Not this year and the price is much higher. My bet remains the same. We have an explosion before we get any sort of meaningful correction.

GATA BE IN IT TO WIN IT!

MIDAS