For obvious reasons we will add this E-mail to http://www.sendereberl.com/ac.htm. The only good news is that the NWO appears now to be listening and thus we highlight the importance of the next E-mail entitled New Year's Day 2005: Part II.
The above article was posted December 28, 2004. Two days later, the following was posted on Rense.com (http://www.rense.com/general61/sign.htm
Venezuela And China
Sign Oil Deal
BBC News
12-30-4
Venezuelan president Hugo Chavez has offered China wide-ranging access to the country's oil reserves.
The offer, made as part of a trade deal between the two countries, will allow China to operate oil fields in Venezuela and invest in new refineries.
Venezuela has also offered to supply 120,000 barrels of fuel oil a month to China.
Venezuela - the world's fifth largest oil exporter - sells about 60% of its output to the United States.
Mr Chavez's administration, which has a strained relationship with the US, is trying to diversify sales to reduce its dependence on its largest export market.
Thirsty for oil
China's quick-growing economy's need for oil has contributed to record-high oil prices this year, along with political unrest in the Middle East and supply bottlenecks. Oil prices are finishing the year roughly 30% higher than they were in January 2004.
In 2004, according to forecasts from the Ministry of Commerce, China's oil imports will be 110m tons, up 21% on the previous year.
China has been a net importer of oil since the mid 1990's with more than a third of the oil and gas it consumes coming from abroad.
A lack of sufficient domestic production and the need to lessen its dependence on imports from the Middle East has meant that China is looking to invest in other potential markets such as Latin America.
Mr Chavez, who is visiting China, said his country would put its many of its oil facilities at the disposal of China.
Chinese firms would be allowed to operate 15 mature oil fields in the east of Venezuela, which could produce more than one billion barrels, he confirmed.
The two countries will also continue a joint venture agreement to produce stocks of the boiler fuel orimulsion.
Mr Chavez has also invited Chinese firms to bid for gas exploration contracts which his government will offer next year in the western Gulf of Venezuela.
The two countries also signed a number of other agreements covering other industries including mining. Story from BBC NEWS:
© BBC MMIV
http://news.bbc.co.uk/go/pr/fr/-/1/hi/business/4123465.stm
-END-
The gold shares continue to trek towards oblivion. The XAU lost 2.14 to 93.51 and the stinky HUI fell 4.39 to 202.15, closing not far from its lows. The scenario for sharp price rises in both gold and silver is staring us in the face. It appears more and more The Gold Cartel has struck to cover short positions before the "S" hits the fan during the weeks/months ahead.
Keep the Faith.
GATA BE IN IT TO WIN IT
MIDAS
Dienstag, 4. Januar 2005
Das Hauptthema an den Finanzmärkten
von unserem Korrespondenten Bill Bonner
Das Hauptthema an den Finanzmärkten bleibt der Dollar. Die Leute denken darüber nach ... sie fragen sich, was daraus wohl werden wird.
James Grant schreibt, dass sich selbst Drogendealer nun dem Euro zuwenden. Im Oktober wurde ein Drogenkurier auf dem Weg von Spanien nach Kolumbien festgenommen, und er hatte 197.000 Euro in seinem Magen. Ich sehe sofort einen weiteren Vorteil des Euro – man kann ihn leichter schlucken. Die größte Dollarnote, die es gibt, ist die 100-Dollar-Note. Die Europäische Zentralbank hingegen gibt 500-Euro-Noten aus. Also kann man einen einzigen Euro-Schein schlucken, statt 5 Dollarscheine – und dieser Schein wird auch noch an Wert gewinnen, während er sich in Ihrem Magen befindet.
Das letzte Mal, das der Dollar so lange so stark fiel, da wurden die Zentralbanker des Planeten alarmiert, und sie entschieden sich, etwas zu tun. Sie kamen 1987 im Louvre zusammen ... und beschlossen ein Abkommen, das half, den Dollar an den Devisenmärkten zu stabilisieren.
Aber 1987 war eine andere Welt. Damals schuldeten die USA dem Ausland weniger, als das Ausland den USA schuldete.
Und der Dollar hatte auch noch keine großen Wettbewerber. Das kommunistische China war immer noch das kommunistische China. Das Wort "ehemalige" war noch nicht im Zusammenhang mit dem Wort "Sowjetunion" erschienen. Indien lag am Boden. Und den Euro gab es noch gar nicht.
Aber jetzt wächst die chinesische Wirtschaft drei Mal so schnell wie die US-Wirtschaft. Das chinesische Wachstum kommt durch das Produzieren von Gütern – und nicht durch den Kauf von Gütern – zustande. Und während die Amerikaner nichts sparen, sollen die Chinesen 40 % ihres Einkommens sparen.
Auch die Inder sind fleißiger als je zuvor – mit einem Wirtschaftswachstum von über 8 %. Überall in Asien sieht es so ähnlich aus – die Leute arbeiten und sparen, um so reich zu werden.
In Europa ist die neue Währung eine richtige Erfolgsstory geworden. Es wird angenommen, dass 75 % aller amerikanischen Dollar außerhalb der USA gehalten werden. Dollar waren eine gute Möglichkeit, seinen Reichtum zu erhalten, als man Rubel und Cruzado nicht traute. Nicht nur Drogendealer, sondern auch durchschnittliche Bäcker und Kerzenmacher fanden es angenehm, Dollarscheine unter ihrer Matratze zu lagern – nur für alle Fälle.
Aber jetzt ist der Euro eine echte Alternative. Nicht nur, dass man mit weniger Scheinen mehr Kaufkraft erhält ... das Papier behält seinen Wert auch besser.
Zuletzt hat der Dollar seinen Wert in etwa halten können. Die Tür zur Hölle hat gehalten.
Wie lange werden sie halten? Ich weiß es nicht. Für jetzt vielleicht. Aber wahrscheinlich nicht für immer.
http://www.investor-verlag.de
Ob der Euro wirklich eine echte Alternative auf längere Sicht ist?
January 5 – Gold $426.20 down $1.80 – Silver $6.48 up 7 cents
Silver Firms / Dennis Gartman: A Pompous Buffoon, Gold Cartel Lackey
A government that is big enough to give you all you want is big enough to take it all away....Barry Goldwater (former U.S. Senator from Arizona)
GO GATA!!!!
Right from the get-go, silver and the gold/silver shares showed immediate strength (only to fade as the day wore on, as usual). Gold was weak all night in Asia and into the early trading hours in London. This is completely in line with how gold has traded over the years. Spec liquidation continues, while the trade waits patiently to scoop up cheap gold.
Gold attempted to rally; however, like yesterday, the new shorts drooled whenever the price approached unchanged and they sold. This is also in line with the way gold has traded after major sell-offs.
Yesterday, MIDAS reported Goldman Sachs to be a substantial buyer covering their shorts, while the specs continue to give up the ghost. The release of today’s gold open interest revealed how true this was as it fell 8694 contracts to 302,298, which was in line with our expectations. Since it probably included a good number of new spec shorts, the COT numbers on Friday should reveal dramatic changes.
A number of commentators continue to point out how right the commercials always are. My take on that:
*If you had the US Government as a backstop partner, you could make money in the short-term just as many of them do.
*Their short-term battle wins do not tell the entire story, as they are losing the war. My guess (sheer speculation) is that the commercials are not that far ahead over the years, especially during this new millennium. They have been short as a group since gold traded below $300. Yet, they have had many short-term wins over the years. My guess (sheer speculation) is that the commercials are not that far ahead over the years, especially during this new millennium. Let’s say they picked up a net $15 profit on this sell-off, as they continued to sell on the way up to $455, starting at the $435 level. Let us then say they have been successful doing this 3 times a year for four years. It adds up to $45 profit for three years x 4 or a total of $180 in profits. Meanwhile, gold has rallied $180 off its bottom.
*One must separate the trading activity of the crooks (Goldman "Hannibal Lecter" Sachs and friends) versus the run of the mill commercials. This is very simplistic commentary on a complicated subject, as the real thugs have cleaned up during this time. Goldman Sachs’ trading positions have made a fortune, for example. The "commercial short" position includes hedgers like Barrick, who have been short all the way up as they hedged heavily with gold below $300 years ago. Subsequently, the Barricks have billions of losses on their books with their shareholders left holding the bag.
*In 1998 and 1999, the commercials did nothing but win. However, in 1997 when gold collapsed, they were slaughtered as the specs were actually very bearish back then and won the day. This was before the rigging of the price became apparent to other commercials, other than the cabal, and to the trading world.
*At the same time there are 13,000+ tonnes of gold loans/swaps still out there, other than those of the hedgers, which have not been called in. Most of those were put on with gold trading around $300, plus or minus. These loans, representing commercial interests, are enormous losers on someone’s books.
*The Black Box large specs have been taken to the cleaners over the years. However, a number of other specs have done quite well by trading from the long side.
*What’s most important is the big spec winnings have not occurred yet. This will happen when The Gold Cartel loses control of their fraudulent scheme and we get our long-awaited Commercial Signal Failure."
There is considerable technical support for gold between $420 and $425, which should hold. See:
February gold
http://futures.tradingcharts.com/chart/YG/25
Funds sold silver early with Morgan Stanley an aggressive buyer. From what we hear, Morgan is very bullish, yet does not expect silver to rally too quickly because of the technical damage done on the way down. Historically, this is ALWAYS the case. Yet, if the input we have on the Chinese tying up ¾ of the 2005 silver production is correct, there is no way silver is staying at these low prices for very long.
The dollar fell .05 to 82.65, as did the euro, dropping .12 to 136.29. However, the yen rose to 104.09.
The John Brimelow Report
Was 2004 1986 re gold and gold shares?
Wednesday, January 05, 2005
Indian ex-duty premiums: AM $8.90, PM $8.15, with world gold at $425.95 and $425.60. Ample for legal imports. The Indian euphoria experienced a jolt today, with the Stock Market down 2.9% and the rupee down 0.7%; in this context domestic gold did quite well.
Back for the first full day since December 27, TOCOM traded a heavy 67,121 Comex equivalent. The active contract fell to the lowest since September 17 before rallying to close flat; world gold was 20c below NY at the close. Several commentators remark that these was public bargain hunting – the Reuters Tokyo gold headline speaks of "solid bids" – but in fact open interest dropped sharply, by the equivalent of 5,067 Comex lots, to 106,894 Comex. (NY yesterday traded 60,295 contracts; open interest plunged 8,694 contracts to 302,298.)
The Shanghai Gold Exchange continues to show high premiums to world gold. The ECB reports an E10 Mm gold sale last week – perhaps a tonne. According to Bloomberg, Virtual Metals says the public data indicated the French sold some 50 tonnes of gold in the last quarter of ’04, strongly implying they are the lead seller at present. Maybe this is their contribution to Operation Iraq Freedom.
UBS sensibly remarked
"Gold confirmed its reputation as a leading indicator of broader commodity weakness yesterday… We believe…that much of the hot money has now exited long gold trades and that the metal is poised to rally once the US dollar stabilises… we like to buy dips in gold down to $420/zo and EUR315/oz…. The fall in the gold price in both dollar and non-dollar terms have prompted very strong demand over the past two days with Indian demand especially strong."
While conventional wisdom as for instance expressed by the Gartman Letter is still talking gold down to $400, it is notable that the noted bullion dealer bear quietly raises an interesting qualification:
"last year was only the second in recent history when bullion rose [5.6%] while gold share indices fell [HUI gold bug – 11.4%, XAU -8.7%]…the last time this share fall/bullion rise combination happened [1986], both bullion and gold equities had a roaring year after."
JB
CARTEL CAPITULATION WATCH
For the third day in a row the US stock market failed to hold early gains. The DOW sank late, falling 33 to 10,597, while the DOG yelped again, dropping 17 to 2091. This is not the way the Wall Street bulls wanted to start the New Year. All that cash supposedly on the sidelines is staying there.
09:53 Bullish sentiment unchanged at 62.9% in latest Investor's Intelligence poll
Bearish sentiment rose to 20.6% from 19.6% in prior week. Those expecting a market correction declined to 16.5% from 17.5%.
* * * * *
US economic news:
10:00 ISM Non-Manufacturing reported 63.1 vs. consensus 61
Prior reading 61.3.
* * * * *
0:19 Challenger says announced job cuts in US increased 17.2% y/o/y
Challenger Gray and Christmas measured 109,045 job cuts, a 4.3% increase over November. * * * * *
NEW YORK, Jan 5 (Reuters) - U.S. planned job cuts rose in December, making it the second worst month for layoffs last year, according to a report released Wednesday.
Employment consulting firm Challenger, Gray & Christmas Inc. said employers announced 109,045 layoffs in December, up from 104,530 in November.
Still, for the year as whole job cuts decreased compared with 2003, and Challenger said there was reason to be optimistic in 2005.
"Job cuts are likely to continue their decline in 2005 with the economy showing signs of improvement. Jobs are finally being created at a steady rate and many of those jobs are in higher-paying occupations," John A. Challenger, chief executive officer of Challenger, Gray & Christmas said. –END-
U.S. Employee confidence slips in December-survey
NEW YORK, Jan 5 (Reuters) - Worries about personal finances and increasing expectations of staff layoffs pushed U.S. employee confidence down to its lowest level in 2004, according to the latest monthly survey by Hudson Highland Group.
The survey, which polled 9,000 workers, showed its employee confidence index fell to 103.6 in December down from 104.9 in November--the survey's lowest level in 2004.
Thirty-one percent of employees said they expected their companies to hire new workers, while 19 percent worried about staff layoffs or losing their own jobs, the survey showed. A year ago, 17 percent were worried about layoffs, while 20 percent worried they would lose their own jobs.
Regionally, employees were most confident in Tampa, Dallas, and Atlanta, while the least confident employees worked in New York, Chicago and Philadelphia, the survey showed.
-END-
10:31 API reports crude oil inventories (9.2M) barrels
Gasolineinventories +4.1M barrels. Distillate inventories +4.6M barrels.
* * * * *
10:31 DOE reports crude oil inventories (3.3M) barrels vs. expectations (1.5M) barrels
Gasoline inventories reported barrels +2M vs. consensus +1.0M barrels. Distillate inventories reported +2M barrels vs. consensus unchanged or (0) barrels
* * * * *
This AP story spooked the stock market late:
http://biz.yahoo.com/ap/050105/inflation_2.html
Associated Press
Consumers Begin to Feel Inflation's Pinch
Wednesday January 5, 3:19 pm ET
By Marc Levy, Associated Press Writer
Consumers Begin to Feel Pain of Inflation As Cost of Many Products and Services Marches Higher
HARRISBURG, Pa. (AP) -- After a decade of relatively tame prices, consumers are starting to feel the "ouch" of inflation as the cost of everything from coffee, candy and home appliances is marching higher.
It's not a sharp pain yet, and some call it hardly noticeable. But with companies such as Procter & Gamble Co., Hershey Foods Corp. and Whirlpool Corp. passing along the higher prices they pay for raw materials to their customers, it's beginning to get attention from people who shop in grocery, appliance and department stores.
It's also getting noticed by officials of the Federal Reserve, and that could mean higher costs for everything from car loans to home mortgages.
Minutes of the Fed's Dec. 14 meeting released on Tuesday suggest that central bankers' worries about rising prices could prompt them to continue bumping up short-term interest rates -- which they raised five times in 2004 -- to keep inflation in check.
For the most part, inflation as measured by the Labor Department's Consumer Price Index has lagged behind the rising cost of wholesale products like fuel, steel and plastics over the past year. In the 12 months ending in November, the CPI rose 3.5 percent while the change in the price of finished goods at the wholesale level increased 5 percent.
But the supply chain, which seems to have absorbed most of the higher costs, may be reaching its tipping point. Analysts say a slowly improving economy is giving producers more confidence to pass on higher prices, especially as excess inventories dwindle and commodities, from green coffee to oil, stay at elevated prices.
"I think the faster rate of inflation is here to stay," said Nigel Gault, managing director of the U.S. economic service of Global Insight in Lexington, Mass. "The important thing is whether it is stabilized at the rate it is at, or whether it will accelerate even faster. That is the question."…
-END-
Incredible...all we have here is the truth becoming so blatant that Washington/Wall Street can't go on hiding it any longer. You have been receiving input such as this from MIDAS and other Cafe contributors for some time now.
What is occurring in Iraq is one sad catastrophe and is bound to dramatically affect US financial markets in the months to come. For reasons hard for me to fathom, investors don’t seem to be paying much attention to what is going on over there. The human toll on our soldiers is horrendous and is growing by the day with no end in sight. How much will Americans be willing to pay in human life/financial terms to help people who want to blow us up on a daily basis? This is all nuts. We are reduced to rooting for the Shiites to win the election. As mentioned before, this is exactly what the US tried to prevent in the 80’s when we backed Iraq in their war against Iran.
From http://www.urbansurvival.com:
Wounded: 10,000
The sad stats from Iraq keep mounting up - today's is the passing of the 10-thousand mark of injured: http://news.bbc.co.uk/1/hi/world/middle_east/4147705.stm Officially, 1,300 have died, but remember that there are a large number of dead who are not counted in that figure because they were kept alive long enough to make it back to Germany, or on to Walter Reed. The actual honest accounting of dead may never be sorted out, especially when you figure in the reports of the hundreds of mercenaries who reportedly have died in the fighting and been buried in unmarked graves after being promised big paychecks if they survived.
In country: 22 dead from today's latest car bombing: http://english.aljazeera.net/N…50F-A471-72E651F93D32.htm
-END-
Paul Kasriel, Chief Economist at Northern Trust-Chicago, Il. is quoted in this past Monday's WSJ. Congrats to Paul Kasriel of Northern Trust for calling it the way he "REALLY" sees it, unlike most mainstream economists!
"Paul Kasriel, chief economist at Northern Trust in Chicago, says a scarier scenario would look something like this: Foreign central banks would lose faith in their U.S. dollar holdings and start dumping U.S. Treasurys. The dollar would drop sharply, inflation would rise and interest rates would rise, "which I think would do severe damage to the household sector and the housing market," he says. In the process, the ground for a new recession -- perhaps in 2006 -- could be laid. He puts the chances of a dollar crash at 25% and the chances of a recession in 2006 at 75%. This puts him out of the consensus. On average, the economists say the chances of a dollar crash are closer to 15%, with the odds of a recession by 2006 at 22%."
Kasriel also noted: that the ability of US consumers to pour more money into mutual funds is diminishing. According to Federal Reserve data, at the start of the ‘90s, US household deposits as a percent of total assets were 13.8%. As of Q3 ’04 they have fallen to 9.7%. During the same period, debt as a percent of total assets has risen to 18.1% from 14.8%.
Houston’s Dan Norcini with some market thoughts:
Hey Bill:
We are now down to open interest levels that were last seen in October 2004 when gold was trading at $420. All the guys who are long from $420 are still in the money and are sitting just fine. That looks like a solid support region and might be bringing in buying just above it. Will have to watch. So far - so good as that is what it looks like has been happening. It's a bit early to tell yet but the signs are encouraging.
Silver has formed a doji on the pit session charts followed by a nice up day today. That's a sign that the selling has temporary exhausted itself. The low at 635 is now support and needs to hold on any subsequent setbacks if silver is going to move on up from here. I like what I see here in silver thus far. It has come 20 points off that intra-day low from yesterday. My guess is that the new shorts from the previous day were unwilling to press it any further and were covering yesterday and today judging by the open interest figures and the price action. It has fallen a long way and is very much oversold on a short-term basis anyway. Stay tuned..........
Dan
March silver
http://futures.tradingcharts.com/chart/SV/35
Rhody reports in on the lease rates:
Hi Bill:
Gold lease rates are now one third the level they were one month ago.
The declines were dramatic this past week, and these declines indicate that the present monetary intervention against gold is ended. With one month lease rates at .045%, this is bargain basement level. Silver lease rates have also declined about one third over this period, meaning the drop in gold lease rates is about twice as dramatic. Put another way, silver lease rates are back up to 4 and 5 times the rates for gold. (You can lease gold for an entire year for the cost of leasing silver for about two weeks.) If lease rates signal the level of liquidity in the "market", and silver is so tight, why was silver hit so hard on COMEX?????????????? The price correction in silver was a full 10%, while gold corrected about half that.
Did you know that as of right now, there is no precious metal bull? If you adjust the present prices of pms for inflation, just back to year 2000, the present price of gold in year 2000 dollars is $285 and silver is $4.30 per ounce. Where's the bull? Some pundits have been calling for a further correction in gold back down to $400. If we do go there, the inflation adjusted price becomes $268, and that's lower than the average price in year 2000. This means anyone who bought gold in 2000, has simply protected his investment from inflation. It further implies that if one hadn't bought back then, you would be doing just as well to buy now, as the wait has been for nothing except an inflation hedge. You wonder why the gold shares have been doing badly? That's why. An American gold mine has had his margins protected by the inflation hedge, but virtually all foreign mines have seen a huge inflation driven rise in their costs but the price of gold has been held down to 1999-2000 levels. Where's the bull? Remember ANOTHER?
He was a popular poster on the Kitco Forum. The quote I remember best from "Another" when queried about gold shares,: "You will be at the end of a long line of people selling gold shares." And so it has come to pass.
The gold price stinks, yet try to find some to buy, and silver is just as tight.
Want to hear the ultimate irony? The only people on earth right now who are benefiting from this so-called gold bull are Americans, and they are the people who caused this world financial crisis in the first place! Talk about profiting from one's mistakes.
Regards, Rhody
Regarding the silver tightness dilemma. Here is some helpful input from a very knowledgeable Café member who knows the silver market very well:
Bill,
Allow me to explain a bit of the silver market, especially at NYMEX, that MAY help to explain why a few Arabs are having a hard time acquiring $10 million worth of silver, and not buying it at the NYMEX, and why the price may go down even in the face of such large buy orders.
Personally speaking, and I request that you keep my name anonymous for this (call me Mr. XYZ), I have difficulty placing orders for more than about $200,000 worth of silver to be filled at once from coin dealers. Currently, I have 4 such orders placed with 4 coin dealers, and perhaps only one of the dealers had the bullion in inventory. Thus, you'd probably hesitate to place a larger order with only one dealer, too! All the rest of the dealers had to order silver from someone else--and so, I spread my orders around. Therefore, I have first hand experience, in knowing that there is tightness in the physical silver bullion market, even in the last week with lower prices. But this tightness always exists, because the coin dealers do not keep, or do not have, that much capital in the form of silver bullion.
Next, the NYMEX has limits. If you buy more than 150 contracts, you are no longer anonymous. That is a limit of 750,000 ounces, or about $4.8 million, at $6.40/oz. So perhaps the Arabs are concerned about remaining anonymous.
There is another limit, a position limit, of 1500 contracts per person, which, of course is much larger than the $10 million of the Arabs you heard about, so that limit is not a concern in this $10 million order, but if the order is for physical bullion, it also does not apply.
A third limit is that a delivery limit can be invoked after delivery of 1,500,000 ounces total for all market participants in one month! Yes, that's right, if 1000 people demand a total of more than 1.5 million ounces of silver off of NYMEX, then NYMEX can halt all physical deliveries once that limit is reached! At $6.80/oz., that's just over $10 million, or precisely $10,200,000.
Now, personally speaking, I know I would have a hard time filling a $10 million order. And I would also not feel comfortable doing that volume of business all in one place, especially not at NYMEX, due to their position limits. I might do 1/3 of the order through NYMEX, but the rest I'd try to do through the coin dealers, and that would also be a lot of risk, and a lot of work.
Furthermore, at this time, you know that the bullion price is moved up and down by the excessive paper futures contracts. You can read Ted Butler for more on this theme. The paper contracts are generally in excess of 100,000 contracts, which far exceeds the silver at NYMEX, sometimes more than ten times as much in paper contracts as physical silver. Therefore, that is another reason why I would be very careful about buying silver with a futures contract at NYMEX, even in "small" amounts of only a few million dollars.
I hope that helps explain the silver market at this time.
Sincerely,
Mr. XYZ
