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

November 26 - Gold $451.70 up $2.70 - Silver $7.68 up 8 cents

Gold Continues Its Relentless Move Higher Moving North Of $450

Gratitude unlocks the fullness of life. It turns what we have into enough, and more. It turns denial into acceptance, chaos to order, confusion to clarity. It can turn a meal into a feast, a house into a home, a stranger into a friend. Gratitude makes sense of our past, brings peace for today, and creates a vision for tomorrow...Melody Beattie

GO GATA!!!!

There is so much to bring your way I decided to do a MIDAS. The way things are going there will be too much to go over on Monday in one commentary.

Yesterday the dollar tanked once again with the euro soaring to 132.22 or thereabouts. Gold followed suit and took out $450 easily. Once this level was breached gold sped up to $452.85 in London. Mario in London noted:

“Both fixings were above $451 and all the bullion banks (JPM, Deut., Merrill and UBS) have revised their outlook for the dollar down.”

Today it was more of the same. The dollar sank and sank with the euro taking out 133 at one point. Gold rose to $455 in sympathy will the dollar drubbing. Slowly but surely gold is on the road to $500 as a first stop. This is despite an aggressive attempt by The Gold Cartel to keep it from creating too much excitement and accelerating rapidly to the upside.

Can the price-capping be any more obvious? The heinous Gold Cartel is not even allowing gold in foreign currencies to hold its own. In euros gold continues to retreat, closing just below 340 today. You would think someone out there outside of this camp might notice how ludicrous the price action is. It is not as if the dollar is the only factor which should be affecting the price. Commodity prices continue to make 23-year HIGHS.

You would think someone out there might notice gold never is allowed to move up sharply in any given day. Forget the $6 Rule. The price-fixers are so scared over excess gold excitement, they have kept almost all advances on the way up between $2 and $4. What a bunch of banana heads out there who comment on the gold market. They couldn’t get this market right if God came down from up high and gave them a script.

Oil rallied $2.30 cents the other day, or around 4%. That would equate to an $18 move in gold. Gold has been in a bull market for three years and except the stunning move up after the surprise Washington Agreement (when the signatories and price-fixers were caught flat-footed), gold has never been allowed to move up like that. Matter of fact, it has only been allowed to rise about half that much ONCE in three full years. One lousy time. No other major commodity bull market has ever traded like gold. Do any of the mainstream gold pundits ever make note of this? No. Never! The brain dead ones.

Lately I noted a few times how gold is the least understood, worst analyzed and most poorly reported on market in history. Here is an example of what I keep referring to:

INTERVIEW: Citigroup Bullish On Gold, Could Up 2005 Call

Friday November 26, 5:35 AM EST

SYDNEY -(Dow Jones)- The bull market in gold is showing no signs of letting up, according to Citigroup Inc. (C), which may soon have to raise its forecast for 2005 as a result, the bank's Sydney-based global commodity analyst told Dow Jones Newswires this week.

"There's no doubt that the recent weakness in the U.S. dollar is what's been fueling the recent rally in the gold price and left our forecast somewhat in limbo, and I guess potentially subject to upgrade," said Alan Heap of Citigroup's Smith Barney brokerage arm.

Heap's current average price forecast for next year is US$425 a troy ounce.

-END-

Could it get any more inane than this Citigroup drivel? Gold is $452. Citi is looking for gold to average $425 next year. And the headline is Citi is bullish on gold. Wonder who is more retarded, Citi or the gold reporter?

Besides pointing out this garbage, it is an example why the investing public is not interested in the gold shares or bullion. Why they can’t even spell gold yet. Citigroup is a quiet member of The Gold Cartel and was a defendant in Reg Howe’s lawsuit. They have been neutral to bearish ALL THE WAY UP. How bad is that? It is more than unbelievable these pros can be so dumb.

Course they’re not that dumb, just corrupt. You see not only did Citigroup fail to analyze the gold market correctly, so did all the other banks/investment firms in The Gold Cartel. NONE of the dealers in the cabal (like JP Morgan and Goldman Sachs) have been bullish the ENTIRE move. NONE called this market correctly from a fundamental point of view. What are the odds that would happen in any other stock sector, the bond market, the real estate market? That the brainiest, most esteemed firms on Wall Street could ALL have it wrong?

Of course the answer is ZERO. Only gold, as these firms have been the ones to rig the price all these years from the short side. Talk about a great story for an inquiring reporter. Go to these firms and ask for their documented calls the past 36 months and then query all of them how they could all get it so wrong.

As far as the public is concerned, many go to the experts in various fields to determine whether to invest or not. The bullion dealers are supposed to be the experts on gold. A good number probably go to big shot Citigroup for advice. Would you buy gold shares with gold at $452 when Citi’s target for next year is $425? The Gold Cartel bullion dealer crowd in New York (and elsewhere in the world) are either a bunch of dingbats or deceptive crooks – or both. Pick your own description.

Bingo! What MIDAS and John Brimelow have been POUNDING THE TABLE on for many, many months is finally receiving coverage in the mainstream gold world. About time:

By Rhona O'Connell
MineWeb.com
Thursday, November 25, 204

LONDON -- The pressure is on for physical gold. Demand is growing and production is falling. That is according to the latest gold supply and demand trends published by the World Gold Council covering the third quarter released this morning and which show a contraction in supply against growth in demand. ...

http://www.mineweb.net/sections/gold_silver/393445.htm

-END-

This is confirming good news as it means more and more pressure will be put on The Gold Cartel to come up with available gold supply to meet the growing monthly supply/demand deficit. The key to understanding the move up these past many months has been the incredibly strong Indian premiums JB has continually brought to our attention. Since the Indians must compete against other major buyers for the dwindling gold supply, they have had to keep their bids high in the international gold arena. Because the cash market has remained so firm, the bums haven’t been able to flush out the legion of specs. The commercials are getting their butts handed to them. A number have to be sweating it out here while they wait and wait and wait for the “inevitable major correction.” At some point we will get our major Commercial Signal Failure. The heat will be just too hot for some of the commercial shorts and they will run for the hills in a panic.

Lois was up early:

Subj: Euro/dollar traded to $1.3329 as of 1:11 ET this morning
Date: 11/26/04 4:54:07 AM Central Standard Time
From: LMRingel
To: Midasnh

CNBC in shock and awe this morning about this...don't people read? Of course your MIDAS subscribers knew this was right around the bend! Hope you've got those stretchers out and ready to go!!

05:28 CNBC reported that part of the reason for the weakness was due to unconfirmed speculation that China was selling U.S. Treasury holdings.
* * * * *

05:44 Follow-up: euro/dollar weakness
The aforementioned weakness due to speculation that China was selling U.S. Treasury holdings (see 5:28 comment) had its source in China Business News, which cited central bank adviser Yu Yongding, according to Bloomberg. Yu subsequently said he has no knowledge of the actions that China's Administration of Foreign Exchange's has taken and will take, reports Bloomberg
* * * * *

CARTEL CAPITULATION WATCH

The DOW rose 3 to 10,523, while the DOG fell 2 to 2102 in quiet holiday trading.

The battered dollar finished at 81.80.

The initial story which spooked the dollar:

China cuts US Treasury holdings to 180 bln usd as dollar slides – report
Friday, November 26, 2004 2:32:03 AM
http://www.afxpress.com

BEIJING (AFX) - China has cut the size of its US Treasury bond holdings in its foreign exchange reserves to 180 bln usd to avoid losses from a weakening US dollar, the Shanghai-based China Business News reported

The newspaper cited Yu Yongding, a member of the monetary policy committee under the central bank

It did not say how much of a reduction in Treasury debt this represented, and the central bank normally does not disclose the composition of its foreign exchange holdings

Yu, speaking at a seminar given at Shanghai University of Finance & Economics, was quoted as saying that China has cut the portion of US dollar-denominated assets as part of its foreign exchange reserves. He said this was largely a reduction in Treasury debt

The newspaper also quoted an unidentified source as saying that US dollar-denominated assets have in the past accounted for about 80 pct of China's foreign exchange reserves. Most of the US dollar assets were Treasury bonds or bills

China's end-September foreign exchange reserves stood at 514.5 bln usd, according to official data

-END-

Could this be a sign of the coming times?

Nov. 25 (Bloomberg) -- Nissan Motor Co., Japan's second- largest carmaker, said it will suspend production at three factories for five days over the next two weeks because the company has difficulty obtaining steel.

The halt in production will affect 25,000 vehicles, said Nissan spokesman Yasuhito Chinone. The Tokyo-based carmaker aims to make up the production in January…. –END-

Wistar Holt is right. This says it all:

Hi Bill,
Make sure you re-read the second to last paragraph in this gold article. According to Standard London Bank, "There is a possibility of a short term correction from these higher levels ($455) on Monday when the U.S. markets return and MAY ATTEMPT TO RESUME CONTROL CLOSER TO TUESDAY'S LOWER CLOSE."

Well there you have it. Even a British Bank is publicly acknowledging that the CARTEL is "attempting to resume control" of the 'runaway' price of gold.

That pretty much says it all!
Wistar

London gold hits $455, eyes $460

Gold prices touched their highest point in more than 16 years at $455 an ounce early on Friday, buoyed by the dollar's relentless fall against the euro, with dealers and analysts now looking towards $460.

"We've seen a new high because the gold price is really following the euro-dollar more than anything, and that's what's going to happen next week," Wolfgang Wrzesniok-Rossbach of Dresdner Kleinwort Wasserstein said.

The metal's three-year bull run has moved into a higher gear this year due mainly to the weak dollar boosting the buying power of non-U.S. investors, with heightened geopolitical tensions also playing a big role.

"If the euro should hit $1.35 then we could see gold at $460. If it doesn't, then the gold price won't rise that much," Wrzesniok-Rossbach said.

Spot gold was quoted at $453.50/454.25 per troy ounce by 0759 GMT, compared with $451.50/452.25 quoted late in Europe on Thursday. It hit its highest since June 1988 earlier at $455.

The dollar was near record lows against the euro and 4-1/2 year lows against the yen in Europe after a report China had cut dollar assets in its foreign exchange reserves.

A central banker who was quoted by a local paper that China is cutting dollar assets in its forex reserves to avoid losses stemming from the weakening U.S. currency later said he was unaware of any government action on foreign reserves.

The euro was at $1.3289 at 0750 GMT, against earlier record highs of $1.3329.

Investors have been attracted to commodities generally as the raw materials sector has outperformed more traditional asset classes such as equities and bonds.

Gold's own fundamentals have strengthened as the recent launch of new exchange-traded funds has widened investment demand.

Standard Bank London said in daily report that a surge towards $460 was possible.

"There is possibility, however, of a short-term correction from these higher levels on Monday when the U.S. markets return and may attempt to resume control closer to Tuesday's lower close," it said.

U.S. markets re-open on Monday after the Thanksgiving holiday that began on Thursday.

-END-

Wistar has some eagle eye:

Bill,
Are you sitting down? You better be, when I relate to you the exact words from your good friend Andy Smith. According to an article on the back page of the C section of the WSJ today titled, "Gold Shines on Dollar's Gloom," loveable Andy of Mitsui Global Precious Metals (trying desperately to discredit this strong rally in gold) says, "Gold is the new snake oil." (Smith) notes that it is being touted as a balm for geopolitical woes, an antidote for both inflation and deflation, a relief from the headaches of dollar depression, and a speculative pick-me-up for low-return stock and bond markets and a cure-all for the world's economic problems.

"The [gold] industry is trying to institutionalize gold as an investment; and that's dangerous," he says. "The fact that we're testing it now indicates we're at the top of the market."

Wistar

-END-

Mitsui may not be an official member of The Gold Cartel, however, Andy Smith is their most visible spokesman. Talk about garbage. This is the sort of crud he has fed to the press the entire move up. Yes, he has called a few pops to the upside, always with the same snide remarks. However, even when calling the upside he made it known he was really long-term bearish. Thus, market goes up. He is right. Market goes down his bearishness was validated. A win-win situation for this brilliant pundit. I like Andy personally, but have had it with him professionally. He has been wrong for years and will be for years to come.

Emails poured in yesterday on the following titled email sent out by GATA’s Chris Powell

[GATA] Bond boss admits that the great scheme is to rip off the developing world:

***

The reason the emails poured in was the essay was taken down. It was initially posted at:

http://www.pimco.com/LeftNav/L…mmentary/FF/2004/FF_Nov_2 004.htm

And now is back up:

What follows are some excerpts from Bloomberg (the entire Bloomberg piece which was already circulated to Café members) who commented on the essay (with my comments in parentheses:

Pimco's McCulley Says
'Little to Fear' From Dollar's Slide

By Monee Fields-White
Bloomberg News Service
Thursday, November 25, 2004

http://www.bloomberg.com/apps/…sid=aCGwucPkXkgw&refer=us

The United States, as a net international borrower, has "little to fear" from the dollar's slide, said Paul McCulley, a managing director at Pacific Investment Management Co.

A falling dollar may spark faster inflation, which typically benefits borrowers, McCulley said in a monthly report on Pimco's Web site. The firm manages the world's largest bond fund. The U.S. currency is down almost 17 percent since the end of 2001, based on the Federal Reserve's Trade-Weighted Major Currency Dollar Index.

"If you are a borrower, higher inflation is actually your friend," said McCulley, who helps manage about $100 billion of the firm's $400 billion of assets. Treasury Secretary John Snow should "quit embarrassing himself and the president by uttering the words 'strong dollar.'"….

(McCulley sounds like MIDAS on Charlie McCarthy Snow)

The Fed has "won the war on inflation," McCulley said in May. The inflation rate for personal consumption expenditures, the largest component of gross domestic product, was 0.7 percent excluding food and energy prices in the third quarter, the lowest since the last quarter of 1962, the government said on Oct. 29.

(If you want to understand one of the motives of rigging the price of gold by the Gold Cartel and why the Wall Street bullion dealers have offered such inept gold analyses to the investing public the past three years, one can ponder simplistically on what McCulley is saying, especially over the past month. Gold has only been able to rally in dollar terms. Each time it is about to break out in euros, for example, it is bopped. Those who say gold is only rallying in dollar terms are correct as of late. Thus, the INFLATION ISSUE is diffused. Wall Street and the establishment cite how gold is only rallying because the dollar is tanking, not because there is any US inflation out there. By keeping the gold move related only to the dollar drop, the bond vigilantes are less spooked. If gold were approaching $500 at the moment, which it should be, talk of inflation would be everywhere.

On a side note, McCulley contradicts his boss Bill Gross who recently stated that inflation was understated in the US, as in understated CPI numbers, etc.)

"The right time for America to debauch its currency, as all right-thinking countries who issue debt in their own currency should want to do, is when a falling dollar inflicts more growth pain on countries with appreciating currencies than it does inflationary pain on the United States," McCulley said.

(Inflicting pain is not the way to make friends and influence people. Course the US is good at this and one of the reasons we are hated around the world. It is because of our arrogance. Take the suppression of the gold price, for example. Had it not been for the price-rigging, the soaring gold price would have greatly stimulated the economies of many poor countries in sub-Saharan Africa. Employment would have plentiful (miners etc.) and there would have been tens of millions more funds to address their horrific disease problems.)

-END-

Down Under thoughts:

G'day Bill,
Your comments on Wednesday:

"Incredibly, there is. The gold industry itself is beyond hope. What a bunch of lightweights! No other industry in the world would allow these in-your-face price-fixing shenanigans to continue without an uproar - and I mean a BIG UPROAR. Well, we know they are a gutless lot."

If one looks at the "Hedging positions" of companies over the last 8 years or so, and then you realize that the majority of "top" management of the gold companies was/is largely run by Accountants who actually implemented the hedge books, it should come as no surprise that this "top" management is actually "top" heavy, and thus lacks the drive to succeed in finding and developing gold mines. They are, generally, "whimps"!!!

Och aye,
Haggis

On the New Yorker article:

Bill, after I read the New Yorker article by Surowiecki, I just had to write something.

I suppose by now all gold bugs have been apprised of James Surowieckis hatchet on gold in the New Yorker

http://newyorker.com/talk/content/?041129ta_talk_surowiecki

It’s salutary to read the people who disagree with the GATA perspective on gold, especially if the appropriate conclusion is that we are right and THEY are wrong. I don’t know why this appeared in the New Yorker instead of MONEY magazine, where a similar attack on gold wackos was published not long ago, but I felt it would be appropriate to point the usual slants of the gold haters. Surowiecki has obviously been reading some of the gold bug stuff:

One gold bug even filed a lawsuit against various government officials and big banks alleging a conspiracy to sabotage gold prices with surreptitious sales. Another compared a skeptical journalist to Joseph Goebbels. Notice how he juxtaposes Goebbels (I don’t know the provenance of that comment) with Reg Howe s lawsuit, which was not dismissed on its merits not even close. (A lot of respected financial writers who are not gold bugs have wondered how the price movement of gold could make sense without manipulation.)

Surowiecki starts his piece with a reference to Ozzie Osbourne’s insistence on an ear, nose and throat specialist backstage at his performances, leading up to Bette Midlers European tour at which she insisted on being paid in gold. The relevance of Ozzie Osbourne here escapes me except to create an atmosphere of crazy obsessions, which the author later attributes to gold bugs.

But more to the point, the author makes some awkward comparisons and draws questionable conclusions. For example, after pointing out that gold is not selling above its price in 1988 (while the S&P 500 has almost quadrupled), he notes that in 1980 ten ounces of gold would have bought you a nice car. Today, it would get you a nice bike. I’m not sure what he considers a nice car, but a $4500 bike is way out of my league. Of course, its absurd to pick the spike of $880 an ounce as a benchmark. We all know that those poor bastards that bought gold at $800 and hung on to it suffered terribly, but that’s the case of everyone who buys at the peak of a bull market. We all know as well that gold went into a 20-year bear market, as some of us fear the equities market may do in the near future. He also notes that the price of gold is up forty per cent in the past two years (due to the trade deficit and war). If we take the bottom as $250 and the recent price as $450, I reckon the increase to be a lot more than 40%.

Surowiecki then goes into the gold-is-a-commodity, albeit not an especially useful one. Of course, we’ve all been conditioned by history, by myth, by Mr.T to think of gold as money. Had to throw Mr.T in there, I suppose he is one of the cranks. Well Gold IS money, always has been. Then he gives himself away:

The world’s central banks and the International Monetary Fund still have vaults full of bullion, even though currencies are no longer backed by gold. Governments hold on to it as a kind of magic symbol, a way of reassuring people that their money is real.

Any subscriber to LeMetropoleCafe has real doubts about just how full those vaults really are, AND there must be some reason why the public needs assurance that their money is real. AND its interesting that the only way central banks can make their money appear real is by having a lot of gold.

Just because it has a long history of being used as money doesn’t mean that it has a future. In the end, our trust in gold is no different from our trust in a piece of paper with one dollar written on it. The value of a currency is, ultimately, what someone will give you for it whether in food, fuel, assets, or labor.

What Bette Midler was saying, I think, and I wholeheartedly agree, is I don’t trust that paper, but I trust gold. What will ultimately drive rank-and-file investors into gold is the fear of a depreciating dollar. When I wanted to buy Euros and Pounds a couple of years ago, my little bank in my little city really wasn’t prepared for such a transaction so I bought gold and silver coins. Those coins are worth about the same in Euros and Pounds as they were then, but they’re worth about 30% more in dollars, and, frankly I trust those coins more than Euros and Pounds. There is a noticeable absence in Surowiecki’s piece about the depreciating dollar. I’d like to end with a scene from forty years ago when I was stationed in the Army in Korea. In those days we were paid in MPCs (Military Pay Currency). We paid for our purchases at the PX in MPCs and you could exchange them for Korean Hwan with the ladies in back of the Korean National Bank, although greenbacks were worth about 10% more. There were a lot of MPCs floating around the city of Seoul, the product of various black markets (I like to think of it as a gray market, less sinister a form of exchange not exactly legal, but necessitated by currency and product manipulation by our respective governments). Then, one day, all the gates were closed and we had to turn in our MPCs for new MPCs. Koreans appeared from all over trying to trade MPCs to the GIs. The old money was soon worthless. MPCs were fiat paper money. We all thought greenbacks would live forever. Now I’m not so sure. Were the old MPCs money? I have a 1,000,000 drachmae (Greek) note from the 1940s. Is it money?

(How many of you remember the shock of seeing the copper showing on the edges of our quarters? Didn’t you feel cheated?)

Ransford Pyle
Gainesville, Florida

At the New Orleans Investment Conference my friend Frank Veneroso went on and on how the copper market was rigged on the long side by a number of dealers around the world. He was vehement in his assertions.

On that note one of your fellow Café members sent us the following as a reminder what the CFTC is all about and how full of crud they are (a keeper when the gold scandal breaks down the road). From Bruce:

This is very, very interesting and relevant.

This CFTC (The Commodity Futures Trading Commission) action against a scheme to "manipulate the price of Copper" is older news here and yes I know it is not Silver or Gold. BUT it is very relevant to "today" what is happening now in what the CFTC is saying, claiming, and promising in their commitment for the future to protect "all markets" from price manipulation.

The CFTC states, "This is an historic moment in the Commission's work to protect the people of the United States, the United States cash and futures markets and thir participants against market manipulation. Today's settlement imposes a substantial civil monetary penalty($150 million paid to the United States Treasury) in response to misconduct which caused very serious harm to the United States markets and users of copper. This settlement comes after a long and difficult investigation, in which the Commission has worked in unprecedented cooperation with regulatory authorities in the United Kingdom, in particular the Financial Services Authority, and with the Japanese Government."

"This settlement culminates one important part of an extensive investigation that has demonstrated our ability to address the challenges of today's international markets. THE RESULT TODAY DEMONSTRATES OUR COMMMITTMENT TO PROTECT OUR MARKETS AND THE CITIZENS OF THE UNITED STATES *FROM PRICE MANIPULATION NO MATTER WHERE THE THREAT ORIGINATES*."

I myself add, WHAT ABOUT GOLD ??. Bruce!

http://www.cftc.gov/opa/enf98/opa4144-98.htm

***

Am I too over the top on my criticisms of The Gold Cartel crowd. Don’t think so. Can’t get on the case of these bums enough. The latest on ANOTHER one of them. AIG made hundreds of millions on their participation in the gold/silver scam, especially in silver.

AIG to Pay $126 Million to Settle U.S. Probes

By Jonathan Stempel
Reuters
Wednesday, November 24, 2004

http://www.reuters.com/newsArt…e=topNews&storyID=6911964

NEW YORK -- American International Group Inc. on Wednesday said it agreed to pay $126 million to settle federal criminal and regulatory probes into whether the big insurer helped two companies fraudulently inflate earnings.

AIG announced the settlements after The Wall Street Journal said federal prosecutors were examining whether Maurice "Hank" Greenberg, AIG's 79-year-old chief executive, in 2001 manipulated AIG's stock price to save money in buying insurer American General Corp.

The insurer still faces New York Attorney General Eliot Spitzer's probe into insurance brokers' alleged collusion with insurers to fix prices. Spitzer accused broker Marsh & McLennan Cos. in a lawsuit of bid rigging, which led to the ouster of its chief executive, Greenberg's son Jeffrey……

The Journal, citing unnamed people familiar with the matter, said the criminal inquiry into Hank Greenberg centers on AIG's $23 billion purchase of Houston's American General in August 2001. It said the inquiry is in the early stages and may not lead to charges.

Greenberg is said to have called the office of Richard Grasso, then chairman of the New York Stock Exchange, to ask him for help in propping up AIG's share price, to keep AIG from having to issue more stock to pay for American General.

Though Grasso was out of the office that day, traders who worked for Goldman Sachs Group Inc. unit Spear, Leeds & Kellogg ultimately bought AIG shares, though it was unclear if this resulted from Greenberg's request, the newspaper said.

Goldman Sachs declined to comment.

-END-

A very sad note to bring to your attention – a Chris Powell GATA dispatch:

GATA's great friend, novelist Arthur Hailey, dies at 84 at home in Bahamas

9a ET Friday, November 26, 2004

Dear Friend of GATA and Gold:

The novelist Arthur Hailey, a great and long-time supporter of GATA and gold, died Wednesday. His obituary from today's edition of The New York Times is appended. We will convey our condolences and gratitude to his family.

CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.

* * *

Novelist Arthur Hailey of 'Airport' Dies at 84

By Michelle O'Donnell
The New York Times
Friday, November 26, 2004

http://www.nytimes.com/2004/11/26/nyregion/26hailey.html? pagewanted=all

Arthur Hailey, the best-selling author whose exhaustively researched suspense novels like "Airport" and "Hotel" also became screen hits, died in his sleep on Wednesday at his home in the Bahamas, his agent, Nancy Stauffer, said yesterday. He was 84.

His wife, Sheila, told The Associated Press that doctors believed that he had suffered a stroke.

Mr. Hailey produced a string of best-sellers, achieving international fame in 1968 with his novel "Airport" (Doubleday), a page-turner about an airport manager's ordeal after a bomber boards a plane flown by the manager's womanizing brother-in-law. It inspired a 1970 movie starring Burt Lancaster and Dean Martin.

Other novels by Mr. Hailey include "Hotel" (Doubleday, 1965), "The Moneychangers" (Doubleday, 1975), and "Overload" (Doubleday, 1979). There are 170 million copies of his books in print, The Associated Press reported.

Critics often dismissed Mr. Hailey's success as the result of a formulaic style in which he centered a crisis on an ordinary character, then inflated the suspense by hopping among multiple related plotlines. But he was so popular with readers that his books were guaranteed to become best-sellers.

If there was a formula to Mr. Hailey's work, it was certainly in his approach to each book. Mr. Hailey, who dropped out of school at 14, would spend about a year researching a subject, followed by six months reviewing his notes, and, finally, about 18 months writing the book, according to the Dictionary of Literary Biography.

That aggressive research -- tracking rebel guerrillas in the Peruvian jungle at age 67 for "The Evening News" (1990), or reading 27 books on the hotel industry for "Hotel" -- gave his novels a realism that appealed to readers, even as some contemporary critics complained that he used it to mask a lack of literary talent. Such criticism seemed to hardly thwart the prodigious Mr. Hailey, who twice came out of retirement to produce top sellers.

Arthur Hailey was born to working-class parents on April 5, 1920, in Luton, England. At 14, after he failed to win a scholarship that his family's poor finances required, he left school, despite a strong interest in reading and writing. "The saddest day of my life," he told The Daily Telegraph of London in 1998.

He overcame his lack of education -- and an inclination to airsickness -- to become an airman in the Royal Air Force during World War II.

After the war, disillusioned with what he saw as a socialist trend in postwar Britain, he moved to Canada, where he worked first at the Maclean-Hunter Publishing Co., then in sales.

Although he had written on the side, he remained largely unsatisfied in his work until a psychological profile suggested that his vast creativity needed another outlet, according to the Dictionary of Literary Biography.

The turning point came in 1955, when he was aboard a flight and began daydreaming about what would happen if all the passengers and crew were incapacitated and if it were left to him to land the plane.

In a blitz of work over two weekends and five weeknights, he produced a teleplay that became "Flight Into Danger," produced to critical acclaim by the Canadian Broadcasting Co. and later sold to NBC.

"I was now able to write full time," Mr. Hailey wrote in Maclean's in 2000. "That was all I ever wanted to do."

In addition to his wife, Mr. Hailey is survived by six children: Roger, John, and Mark, from a marriage that ended in divorce; and Jane, Steven and Diane, from his second marriage.

-END-

Arthur came to visit Reg Howe and me at a London Gold Conference several years ago. What a nice guy and a HUGE GATA supporter. During the Denver Gold Group conference he announced in a public letter that he dumped all his Barrick Gold stock because of their hedging policies and bought into the non-hedgers. A great move financially and one which received a good deal of publicity.

We shall really miss this good man who was constantly in contact with Chris Powell and me over the years.

On the gold shares:

Dear Bill,
"I have been thinking about the HUI and XAU under-performing gold and sent this chart back on April 29, 2004 and I insert the comments which you kindly included in the April 29, 2004 MIDAS commentary.

As I have told you I started in the brokerage business in 1980. In late summer 1982 the Dow broke 1000 prompting me to explain to each of my clients that I felt the stock market landscape had changed, as a new, all time high had been reached. Even though I was armed with charts and graphs from the best of the day, including Mr. Yale Hirsch's famous long-term chart, few clients invested. The Dow reached 1500 not long after and investors started to put their toes in the water. The Dow promptly corrected back to the neckline and investors bailed. The famous Bull Market followed. I view this market in much the same way. You break resistance, like a plane going through a sound barrier with a bang, followed by the hush of no resistance. Like the Dow in 1982 and the XAU now, they were powerful breakouts. We have pulled back to powerful support. I believe, given the fundamentals behind the initial move, these support levels will hold. This is not a short-term prediction but a long-term view. What has changed except the share price? Mr. Hamilton stated last week, assuming nothing has changed in his work since, that gold shares and gold are well priced at these levels. Investors could be selling gold at bargain prices today when we look in the rearview mirror 5 years from now."

So where are we today?

In the fall of 1992 and the spring of 1993, I over weighted clients in gold shares. I began taking money off the table at the end of 1993 and early in 1994 when shares like Agnico Eagle had tripled. At that time investors were buying gold shares and gold funds. Gold shares didn't do much during the next year other than drift sideways (I repurchased too early, I can say in hindsight), although some individual gold companies did very well, many investors sold in late 1995. This year has been similar in that we began the year, late December 2003 early January 2004, with a high followed by a retest in April when gold reached a little higher high but had no follow through. Today, some gold companies are making new highs like Nova, Greystar, Linear and Virginia while others like Golden Star and Minefinders are lagging. This could be the result of several things; tax loss selling, mutual fund companies selling and short term investors selling. You may recall that in late 2001 Kinross sold from $1.40 down to $0.95 (pre reverse split) in days because a large fund was selling, only to rebound in 2002 by 100%.

In short, for the investors who buy lawn mowers in the winter and snow blowers in the summer, this could be a very good time to buy quality producing or near production gold and silver shares.

Have a great Thanksgiving Bill (I am thankful for many things not the least is of which was the formation of GATA).
John C. Newell

From “Mr. Gold”:

Friday, November 26, 2004, 12:14:00 PM EST
Gold Community Warning!

Author: Jim Sinclair

China has announced that it is considering the sale of U.S. dollar-denominated Federal Debt held as reserves by the Central Bank.

This comes on the heels of Russia's decision to consider doing the same thing as a means of shifting to Euro-based items. Keep in mind, central banks do not hold significant dollars as dollars, or euros as euros, but rather as debt instruments, so the reduction of dollars in favor of other currencies mainly means the sale of U.S. Federal Debt Instruments and the purchase of alternative debt instruments in their place.

Mark today, November 26th, as the end of the U.S. dollar as the reserve currency of choice.

The U.S. dollar is now trading directly on the 1995 low, having broken down the BEARISH NECKLINE of the Head-and-Shoulders of all time, with a measured move between .7300 minimum and .5100 maximum.

Intervention aside, the U.S. dollar dies once we have three closes below .8197. I would be floored if there is no attempt to prevent this here and now, as defined by next week. However, it is totally hopeless in my opinion, as no intervention can stop the crash of the common stock of the U.S.A., the U.S. dollar.

Hold gold -- your investment and insurance -- close to your chest, and do not listen to the pea-brains that have taken the place of the Prechterites within the gold community, possibly costing you the opportunity of a lifetime as they look for tops.

Gold shares will soon out-perform gold itself, as new and more knowledgeable international investors enter the smallest capitalized investment market on the planet, gold shares.

Avoid those juniors and major gold companies that have derivative risk. Do not buy the bull of "margin-free gold derivatives" as that is such spin, and even makes the U.S. government look like kindergarten spinners.

Change your mortgages immediately to a fixed rate from a floating rate. Make sure no debt you hold balloons in 2007. If you can pay down debt immediately, do it! If you do not own real gold, it is late, but there is time to buy some. Do not sell good, well-managed properties, shares of gold exploration and development companies that are free of derivative risk and have no insider stock-option plan, or royalty gold shares with the same criteria of excellent gold companies.

The next four years are going to be dillies.

Do not listen to gold-community nuts that spend their time always looking for tops.

-END-

More from “Mr. Gold”:

Friday, November 26, 2004, 2:29:00 PM EST
Gold Summary

Author: Jim Sinclair

The unexpected, considered impossible by some, has occurred, yet the world is asleep to the event.

On this momentous currency day, the gold market was all but closed, with only light European activity. The USD commodity markets were closed. What happened today is really bad news for the shorts and the derivative-laden gold producers who are asleep with their "no-margin call", margin-call risks. .

The U.S. dollar closed below the low of 1995, and, as we all know, the Mother of All BEARISH Necklines recently gave up the ghost. .

I believe government spinners will start spinning how they can cut the deficits while still reducing taxes and warring in many places. I think it may be difficult for the U.S. Treasury Secretary to give speeches about the "Strong Dollar Policy," because, like the error-prone weatherman who fails to look out his window before making forecasts, he has failed to check the quote on the U.S. dollar. The only way he could keep a straight face is to genuinely not have a clue about what he speaks.

I don't think it matters one hoot if all the firepower of the U.S. government is turned on stopping the dollar's decline, because in my opinion, a pull-back to the underside of the BEARISH neckline of all time is the best-case scenario for the Humpty Dumpty Dollar. That is the best that can be done, yet it may not even happen. .

This is serious. This is the real-time death-rattle of the U.S. dollar as the reserve currency of choice. This is the birth of the Russian ruble, Chinese currency and Islamic dinar as currencies of preference. I still look at the euro as a basket of junk, preferring, as you know, the Swiss and Cando as my currencies of choice. The Swiss, because it is the traditional currency of the old European super-wealthy, and the Cando, because it's a resource-based nation, even if a few provinces are somewhat strange. One takes pride in being among the last socialist jurisdictions on the planet, while another is convinced it is in Europe. But they gave the world John Candy and half the original cast of "Saturday Night Live", so they must be okay. They are holding hostage the one man who should be the Chairman of the U.S. Federal Reserve and Secretary of the Treasury, all at once, and that is Canadian Dr. Reuven Brenner. He is the only renowned economist who has both the theory and practical application of economics and the markets down cold. Free Brenner and send him to the U.S. Fed, please.

CLICK HERE and pin these charts on your wall to remember the day the U.S. dollar died.

Build up your financial foundation with gold strength. Do not allow small reactions to shake you out. Traders buy the break-out from short-term down-trends in gold. Keep your gold shares. The game has taken a most serious turn much earlier than it should have.

-END-

The gold shares showed signs of life with the XAU gaining 2.66 to 109.87 and the HUI jumping 6.11 to 243.32. However, many gold companies remains woefully undervalued.

Two of my major holdings can’t get out of their own way. Last year Golden Star Resources ($4.35 up a 7 pitiful cents) and ECU Silver (31 cents Cdn, up 1 cent) were two of the hottest stocks out there. This year they are bow-wows. Having spoken to management of both firms recently, they are either two of the greatest buys out in the gold/silver share universe, or I am clueless on each.

Michel Roy, ECU CEO, has spent years turning this firm around and FINALLY has got the company just where he wanted it all along. The market doesn’t think so, halving its share price from last year. Michel:

Dear shareholders,

It is sad that the market did not fully appreciate the importance of the last press release for your Company. The settling of all litigations related to the operation of our mines has been the prime objective of management since I accepted the position of president in 1999. This has created an intolerable situation whereas the planned share pricing for the private placement needed to finalize this key agreement was not in line with the market. We faced a choice of either risking a default on the settlement agreement resulting in losing five years of efforts or changing the private placement pricing to reflect the current market conditions.

Management's top priority is to maximize the value of the Company for our shareholders. In order to achieve this we have been working on: 1) eliminating the risks related to the Company because of the legal problems, 2) increasing the reserves base and 3) achieving positive cash flows. We have clearly achieved the first two objectives and we are well on our way to achieving the third. On December 1st we will make the second payment of US$500,000 to settle once and for all, the outstanding litigations. We will complete the life of reserves mine planning next week so that the independent consultant can finalize the 43-101 compliant report on the reserves. We need a few more numbers before we can release the milling results but you can expect a general update early next week. Our planning should assure us of being very cash-flow positive as early as this coming January.

We are currently working on the 2005 financial projections These projections will be based on various scenarios which will include our existing production, production from the planned expansion of our current mill, production from custom milling, and production from acquisitions,

Truly yours,
Michel Roy

ECU Silver chart (hit ECU in CA)

http://www.stockwatch.com/swne…utilit_snapsh_result.aspx

Golden Star Resources had some bumps in the 3rd quarter as far as costs and mining were concerned. From what I know this is almost all behind them. So is their $401 realized average gold price from their sales. Who knows, GSS could average $440 per ounce this quarter. The difference goes directly to the bottom line.

Last year with gold at $420, GSS traded as high as $8.64. With gold $32 higher, the share price is another halfer. Go figure.

Golden Star Resources chart (hit GSS in the US)

http://www.stockwatch.com/swne…utilit_snapsh_result.aspx

I have the utmost confidence in the superb management of each company. Both of these firms are home run plays. If not, big egg on my face and a leaner wallet than I would like.

GATA BE IN IT TO WIN IT!

MIDAS