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

Pot pourri:

Bill - this is from George Ure's comments this am. small item but interesting.
Regards, Mark.

Don't know if you caught it, but here is a quote from Beijing Peoples Daily Online of 14 Mar 2005:

"The Ministry of Labor and Social Security of China announced the third batch of new professions recently. ...[The] ten new professions are: credit management specialist, internet editor, real property planner, professional information analyst, toy designer, analyst for gold investment, enterprise culture specialist, home textile designer, micro hydropower technician and intelligent building automation technician."

Of special note are the gold investment analyst and micro hyrdopower technician. Looks like China at least is getting ready for a shift towards hard currency, and preparing to maintain an electric lifestyle even in the face of rising oil costs. Interesting, no?"

-END-

Rhody earlier:

Good morning:
Lord Keynes called gold that "barbarous relic" and silver is "just a commodity", so why are their trading patterns so similar?????? Take a look at the gold and silver spot charts below that display the last three days of trading up to about 6:30 am. Notice any similarities? Central banks still admit gold is money but why does silver trade with gold? Could it be that silver is also money........? Whoever is repressing the rise of these two metals is treating them like they are alike. "They" are having difficulty getting gold below $440 and silver below $7.35 even as the CRB keeps making new highs.
Rhody

Barrick’s response to judge’s order on Blanchard case:

From Reuters
Tuesday, March 15, 2005

http://www.reuters.com/newsArt…e=topNews&storyID=7911750

VANCOUVER, British Columbia -- Barrick Gold Corp. confirmed reports on Tuesday that a U.S. judge had ordered it and coin dealer Blanchard and Co. to try to settle an acrimonious antitrust suit, but the miner said this was a "normal" procedure in a such a court case.

Blanchard, a New Orleans-based coin and bullion dealer, accused Barrick in a December 2002 lawsuit of conspiring to manipulate the gold price. Barrick, the world's third largest gold producer, denies the charge… -END-

Contrary to what some of the pundits are saying, this IS a big deal. Sure this is a normal effort by a judge to have the case settled. However, this case is far from normal and different than almost any other because the ramifications are earth shaking. This is not just about Barrick, Morgan and Blanchard. It is about the world financial system.

More specifically this is mega news because of the way Barrick and its pitiful sycophants have spoken publicly about the case in the past. We need only go back a week to see what Gold Cartel stooge Tim Wood presented during the PDAC conference in Toronto:

More Intrepid Barrick Emerging from Purgatory

By Tim Wood
09 Mar 2005 at 12:06 AM EST

Barrick president and CEO, Greg Wilkins...

That's not to say Wilkins has doubts. He has clearly been the right pick by chairman Peter Munk to paddle Barrick over the rapids of operational bobbles that surprised the market and bled the income statement. That stoked internal upheavals crowned by the sudden departure of former CEO Randall Oliphant in February 2003. Thereafter came a period of confusion over the company's strategy of selling gold forward, and coinciding with heightened attacks on the company as a lead protagonist in a fanciful global conspiracy to suppress the gold price.

It still faces a lawsuit filed in New Orleans federal court by nusmimatic merchant Blanchard & Co. to prove just such a scheme. Pleadings are expected to commence in the second quarter… - END-

FANCIFUL GLOBAL CONSPIRACY, eh? Then why has the judge ordered Morgan and Barrick to try and settle the case?

To give you some idea how right GATA is and how disingenuous (to be gentle) Wilkins, Barrick and Wood are, we need only go back to Barrick’s hypocritical, lying, devious presentation as to its hedging policies during a London gold conference in November 2003:

November 21 - Gold $395.80 up $2.80 - Silver $5.27 up 3 cents
GATA 1 Barrick 0 / Goldman Sachs Stops Gold Rally

Reuters
UPDATE - Barrick changes policy, drops gold hedging
Friday November 21, 8:19 am ET
By Veronica Brown

LONDON, Nov 21 (Reuters) - Barrick Gold Corp (Toronto:ABX.TO - News) stunned bullion markets on Friday by saying it was changing its hedging policy, and is no longer committed to selling the metal on forward markets as it is now cash rich.

"The commitment to hedging is gone...Hedging to us is no longer a requirement for running our business as it no longer creates shareholder value," Barrick Chairman and founder Peter Munk told reporters on the sidelines of a gold investment summit in London… - END-

Stunned is the right word. My comments the following Monday:

November 24 Gold $391.30 down $4.50 - Silver $5.23 down 4 cents

No matter how you look at it, Barrick’s stunning reversal of their hedging policy last Friday is very bullish for the reasons discussed in Friday’s MIDAS. The buzz in the gold world is about what happened to Barrick between Thursday and Friday? There is only one explanation in my book. It has to have something to do with the Blanchard & Co. case. What we know:

*Barrick’s Peter Munk unexpectedly announced a change in Barrick’s hedging policy from one day to the next, coming across like a chairman who either can’t make up his mind, or was suddenly TOLD what to say.

*CEO Wilkins was supposed to speak in London, but left for New Orleans on "urgent business" according to MineWeb. New Orleans Federal District Court is where the gold manipulation court case has gone into the Discovery phase.

*I have been told Barrick has learned of the expert witnesses who will be called to testify against them and they were stunned. I have also been informed there is discussion about some damning emails. This is only conjecture as I received this information second-hand, but it comes from a good source and it all fits. You don’t tell the world how great hedging is one day and then do a complete about face the next day without a compelling reason.

*One of the objectives of the Blanchard case is to seek immediate injunctive relief from Barrick, which is a demand they lift their hedges. Perhaps Barrick and Blanchard are working on a settlement, with one of the stipulations being an immediate cessation of hedging.

*Barrick extolled hedging at $300, but is giving it up at $400, not just now but for the next 10 years. Very strange to say the least. Something has to be wrong.

-END-

The bottom line is the judge’s order is monumental, reveals how powerful Blanchard’s case is, and provides more concrete evidence of just how right GATA has been for so many years.

Don Doyle, Blanchard CEO, please note. If you do settle, don’t go cheap. Your scandal dwarfs this one:

JP Morgan in $2 bln settlement over WorldCom-WSJ
Wed Mar 16, 2005 02:50 PM ET

NEW YORK, March 16 (Reuters) - New York State Comptroller Alan Hevesi, who is suing banks for their roles in financing WorldCom, has agreed to a $2 billion settlement with J.P. Morgan Chase & Co. (JPM.N: Quote, Profile, Research) regarding its involvement with the failed telecommunications company, the Wall Street Journal reported on its Web site Wednesday…

-END-

Technicals on gold and the CRB:

Hi Bill:
I do not recall seeing, at the time, the minute by minute action in the court room on Reg Howe's law suit. I found it fascinating reading tonight.

With regard to the GOLD/CRB ratio, it has performed a classic 5 wave down motion to the absolute lows since 2002. Five waves down is a very strong indication of a move´s exhaustion in anything gold related. Please take a look at the chart:

http://stockcharts.com/def/servlet/SC.web?c=$GOLD:$CRB,uu[w,a]wallyyay[pb50!b200!f][vc60][iUv15!Ul14]&pref=G

Unbelievable, this assault on gold and on our perceptions.
Best,
David.

The tenor of many of my emails today from a fellow Café member:

What is this crap with gold and silver? The euro is up 106 pips as I write this and silver and gold are barely green! In the 3 plus years that I've been trading precious metals and currencies, I've NEVER seen the capping as intense as it is the past few weeks. Both Dan and John in your Midas update last night did a great job of quantifying the capping. On another note, GM warned on '05 earnings today. They are now projecting over $2 billion negative operating cash flow for all of '05. GM has lost money on autos for a long time but has more than made up the losses on its finance business. Most people are not aware of this, but GM is the 100% owner of Ditech. Talk about a sub-prime mess Ditech must be. Just wait until the people who have GM loans on their cars and Ditech home equity loans begin to default on both...God help us all...
Dave in Denver

More pot pourri:

Bill,
My local newspaper reports that last month, Liu Min, the chief of the Bengbu, China Statistics Bureau committed suicide. While there is no official comment on Mr. Min's death, his neighbors and friends all believe that political pressure to inflate the city's economic statistics led to his suicide. Mr. Min was clearly a man of greater conscience than our own Washington statisticians, who inflate America's economic statistics without remorse.

The well-respected UCLA Anderson Forecast notes that California residential real estate has risen by $1.7 TRILLION since 2001 and that is equal to 35% of all TOTAL personal income over that time period. HALF of all private sector jobs created in California over the last 24 months are real estate related. 2% of ALL working-age Californians are REAL ESTATE BROKERS and real estate related work now accounts for one out of ten jobs in the state. It's too bad it's not possible to spot a bubble while you're in it, right Al?

A senior Anderson Report economist comments, "We have an economy that's rolling along on the basis of a false sense of wealth." He adds, "Even a simple slowdown in the accumulation of equity in the state could harshly depress spending habits, job creation and economic expansion." The Anderson Report is best known nationally for having accurately predicted the 2001 recession.

Finally, I returned a rental car to Avis yesterday. The employee who checked the car in asked, in a humorous way, if I had left any personal items behind including food, computers, gold bullion or California Wine. I replied that I would have to check thoroughly for the wine. The Avis man then said, "I would rather have the gold bullion. Regular money is getting devaluated (that's how he put it) too fast." I guess he hasn't heard — there is no inflation. Just ask Uncles Al or Ben.

Best wishes,
Peter R.

Waited to hear from James Turk before bringing this development to your attention:

India hopes to wean citizens from gold

By Anand Giridharadas
International Herald Tribune
Wednesday, March 16, 2005

MUMBAI, India The Indian government is placing a long-range wager that an increasingly prosperous population can be coaxed to part - at least physically - with its boundless hoards of gold.

.A policy floated recently would allow Indians to buy virtual, or "paper," gold in denominations as low as $2, instead of investing in necklaces, bangles and coins. It is a step, analysts say, toward bringing millions of poor Indians into the banking system and unlocking the untapped investment potential of more than $200 billion worth of privately held gold in India.

.Indians are the world's biggest gold consumers, with more than half the country's savings tied up in physical assets. Particularly among the very poorest, Indians are prone to spending much of their income to acquire the metal, locking up their assets in the resulting hoards….

A virtual-gold system could also expand much-needed rural credit: The poor could gradually put cash into paper gold, and then take out more affordable loans from government banks with paper gold as backing, said Sanjeev Agarwal of the World Gold Council…

http://www.iht.com/articles/2005/03/15/news/gold.html

-END-

James Turk responds:

Bill
Thanks for sending this to me.

The title of this article says it all -- it's surprising that this newspaper (which I believe is owned by the NY Times and Washington Post) would be so frank as to what they are trying to accomplish in India in turning physical gold into paper, but then again, this newspaper circulates outside the US.

Also, the World Gold Council is finally showing its true colors. How can an employee of the World Gold Council support ANY paper gold scheme? Their objective -- supposedly -- is to increase the offtake of physical gold. That is their mandate. By advocating a paper gold scheme in any form the WGC employee makes it clear that the WGC is doing the bidding of the gold cartel.

That the gold cartel is trying to get Indians to dishoard physical metal shows their desperation, namely, that the gold cartel is running out of physical metal.
Regards
James

The gold shares continue to do little. The XAU rose .81 to 101.43 and the HUI gained 1.51 to 220.21. Compared to what oil, the CRB, the dollar, and other resource stocks are doing, this is more than pitiful. I certainly can understand why the stocks are going nowhere:

*The gold price is rigged. The upside, until The Gold Cartel is sent to a firing squad or the gold derivatives neutron bomb is in the process of going off, is nil at present.

*The gold industry could care less and says nothing about this fraud. Why should investors and potential shareholders?

*While the price is capped, costs to mine producers continue to escalate. Many gold companies can’t make any money at these gold prices and the situation is worsening.

*No sense buying the explorations. Why find gold to produce it at a loss?

My point is The Gold Cartel has reduced the gold industry to joke status and investors are responding accordingly.

Have you written, emailed, or called your gold companies to find out what they are doing about this joke? How are they supporting GATA, or planning to? Are they coming to Gold Rush 21? How many told you yes?

All that said, I am staying fully invested; and, the reason is these bums are going to blow up one day and the price of gold will rally $100 in a week. The share prices of many of the smaller gold companies (juniors and explorations) will double overnight and triple in a short period of time. Those not on board will find entry points to be dear and extremely hard to execute without paying a fortune.

GATA BE IN IT TO WIN IT!

MIDAS

Appendix

The clueless gold industry:

Called ten mining co. about attending your gold rush 21 meeting aug 8 and 9th. eight did not know your company at all, and 2 had heard of gata!!!!! i was amazed!! so i gave them both barrels, and since i was one of their share holders, i thought they should make arrangements to attend!!!!!! i did not mince words!!!! they all assured me that they would look into it. i said if they where not on the list of attendees, i would re-structure my portfolio!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
best, and good luck to us all. paul

One Café member’s view re Blanchard settling the Barrick/Morgan gold price manipulation case:

Bill, the value to Blanchard's shareholders is leveraged a hundredfold if the truth is made public.
Blanchard is BEING NEGLIGENT TO ITS SHAREHOLDERS IF THEY DO NOT bring this as far as possible into public domain. It is NOT UP TO THE COURT TO FORCE A SETTLEMENT. It is only up to the court to hear the facts and permit a JURY TO DECIDE. ONLY IF THE CHARGES are brought by the Govt can the Govt dismiss.

A CLASS ACTION SUIT BY SHAREHOLDERS AGAINST BLANCHARD WOULD BE APPROPRIATE IF BLANCHARD ACCEPTS A CLOSED DOOR, NO FACTS REVEALED, SETTLEMENT.

Think of how many potential customers would be drawn to gold if the FACTS became known?

thanks for any support possible.

Regards,
Martin.........

I was just a 21 year old man at the time I refused to be bullied by criminals wearing badges.

And MY NAME IS OPEN to anyone. I am truthful. Please use your discretion. I of course had to give full details in all honesty in order that when trial came there could be no doubt as to my testimony.

The attorney which worked (the second attorney, the first turned out to be working FOR the US Govt although he was presenting and charging as a Private Atttorney, Luis J. Vernell, Miami Beach, Fl.) for us for a very small sum had JUST COME FROM THE CHICAGO Organized Crime Strike Force working for Tew, Tew, Rosen and Murry here in Miami, and we were his FIRST case as a private attorney. Obviously our case permitted him to gain IMMEDIATE ACCESS to the highest levels of the local conspirators (you know Miami), which led up to Patrick Buchanan as the head DA of the S.E. District of the Federal Court System. His name was William P. Cagney 3rd. Fighting Irishman knew he had a live case here, and beat them to their own graves with it.

There were many, many men sent packing after this case, and fortunately a 21 year old kid is too naive to know enough about how the law "really" works........they told me "no deals" when they tried their "recruitment" techniques on me, and when they tried to plea bargain me after I had the goods on them I was not about to bend. There was no internet at that time, this was shoe leather to the Miami Herald archives to uncover past events, hardcopies. The first attorney was moving his offices and offered to let me help him move as part of our "fee" to him (the bad atty who went to prison). While moving his office some boxes with papers with familiar names came to my brother's attention.......and we swung into action and that is just the beginning of it. Bastards. My father was a military Colonel at that time so you can imagine how all of this went down with the family. Thirty two years later I celebrate the Ides of March EVERY YEAR. AND I CELEBRATE CAT FITTS EVERY TIME I SEE HER PHOTO, HER NAME, OR HEAR HER VOICE.

Regards,
martin t

March 17 – Gold $438.10 down $5 – Silver $7.36 down 5 cents

Derivatives Laden Three Amigos (GM, Fannie Mae And AIG) SINK Noticeably!

Be who you are and say what you feel, because those who mind don't matter and those who matter don't mind... Dr Seuss

GO GATA!!!

What a miserable St. Patrick’s Day, at least as far as gold is concerned. Time for me to get this MIDAS out of the way and head out to my local pub for some green beer. It will be the only green thing going my way on this March 17. Will raise my mug to all Café members and wish you all a Happy St. Pat’s Day with a toast that "the Luck o’ The Irish" does the bad guys in as this year progresses. AND raise another mug with this IRISH TOAST to you:

May there always be work for your hands to do;

May your purse always hold a coin or two;

May the sun always shine on your windowpane;

May a rainbow be certain to follow each rain;

May the hand of a friend always be near you;

May God fill your heart with gladness to cheer you.

HAPPY ST. PADDY'S DAY!!!

The Gold Cartel attacked right on cue and in clockwork fashion. Same drill. They capped gold on recent euro strength and then went after it as soon as the dollar barely picked its head up. To give you some concrete evidence of this we only need to compare today to yesterday when the euro rose a full point and gold was only allowed to rise $3.10. Yet today with the March euro falling only. 40 to 1.3401, gold dropped $5. So the euro only gave up 40% of its gains over the two day period, while gold forfeited all its gains and tacked on a 60% loss to boot. To make it worse the pound and Aussie dollar only fell slightly and the Canadian dollar rose a bit. This with oil up smartly again on the day until after gold closed.

The Gold Cartel has been pulling this blatantly obvious maneuver for years and gets away with this illegal, crooked trading because the establishment gold world says nothing about it. Their failure to deal with the truth is reprehensible and beyond contempt.

Meanwhile:

Morgan Stanley, Goldman Post Higher Profits, Led by Trading

…Goldman, the world's third-biggest securities firm, said net income advanced to $2.94 a share from $2.50 in the quarter ended Feb. 25, exceeding the average analyst estimate of $2.25 a share.

Chief Executive Officer Henry Paulson, 58, relied on trading debt, currencies and commodities for 36 percent of earnings last year, and equity trading for another 23 percent. Fees from mergers and acquisitions accounted for 8.5 percent of revenue, even though the firm was the No. 1 adviser in the busiest takeover market since 2000….

-END-

They mentioned on CNBC today a feature of Goldman Sachs' enormous profits and beating analyst expectations was due to their commodity trading. So Goldman "Hannibal Lecter" Sachs makes a fortune partly via trading illegally in the gold market (in violation of US anti-trust laws) and rips off investors like yourself in the process. If you own gold stocks and they are stinking up the place, you can think of your recent setbacks and losses as contributions to mighty Goldman Sachs. Until these crooks are taken out, nothing will change, which is why Gold Rush 21 in the Yukon is so important. Instead of just screaming, "FOUL!" GATA is actively doing something about this scandal. Have you contacted all your gold companies yet to help out?

Here’s the latest on the pit action on Comex. We all know the funds are super long and The Gold Cartel and groupie followers are short. The funds are finally "tiring of not seeing gold participate in the commodities move," so a number of them sold today when gold failed immediately after the Comex open. Morgan Stanley was a small buyer, covering some shorts.

The bad news is we could easily have a debacle on our hands which the crooked cabal shorts are trying to engineer so they can steal more of the public’s money and take gold out of harm’s way in the process. One fund alone is long 15,000 to 20,000 contracts. That fund did some selling today. SOME selling. Should that fund puke out its entire position and do so at once, which it has done before, look out below. That will set off an avalanche of fund liquidation.

There are only 8 trading days left until the April rollovers kick in. Should gold not be on the move by then, a number of the funds will sell out rather than switch into the June contract. The Gold Cartel knows this and is trading accordingly.

Historically, an 11 to 1 oil to gold ratio has been a lightening rod for investors from all over the world to buy gold. Thanks to the heinous ones, this has been thrown out the window. The ratio made a new low today, falling to 7.76.

The dollar only rose .23 to 81.81.

Crude oil was hit late after running up $1 on the day with a half hour left in the trading period. It closed at $56.40 down 6 cents per barrel.

The CRB took a breather, dropping 1.27 to 34.15.

The John Brimelow Report

Is that smell coffee?

Thursday, March 17, 2005

Indian ex-duty premiums: AM $6.21, PM $4.54, with world gold at $443.30 and $442.40. Above, and slightly below legal import point. World gold in India this morning was the highest since December 29, but sentiment was probably more damaged by further intervention by the Reserve Bank to weaken the rupee. Also high Oil is not popular in India which imports 70% of its requirements. The stock market fell over 1%.

Japan’s detachment continued. TOCOM volume did rise 24% to the equivalent of 13,358 Comex lots, and the active contract went out up 10 yen. World gold edged up 30c above the NY close. But open interest slipped the equivalent of 290 Comex and the Mitsubishi data implies the public reduced its long by 1.2 tonnes (386 Comex); there seems no gold enthusiasm in Japan.

A Dow Jones story misleadingly headlined "Lifting of Bank Deposit Guarantee Aids Japan Gold Demand" in fact reports the reverse: coin sales in the country were sluggish last year and are weaker this year. Japan does something important in gold once every several years: not this year, it seems.

NY yesterday traded 60,600 contracts. Open interest rose 28 lots.

In the past four business days, open interest has grown 32,470 lots - 101 tonnes, or 10.7%. Gold rose $1.10. To put this in perspective, from November 8th to 22cnd last year open interest rose 36, 732 lots – but gold went up $14.40 to a 16 year high. Open interest not rising yesterday is hardly surprising – some of the more alert longs are smelling the coffee. Amongst them is Refco Research, which sold on Tuesday and said of yesterday:

"April gold’s failure to test 445 resistance given Wednesday’s report on the current account deficit and the surge in oil price is disappointing. The hefty gains in open interest over the last week (almost 40,000 contracts) in a stalled market suggests gold faces staunch resistance at the moment."

Some reports speak of stimulated physical demand this morning as gold was pushed below $440. The issue now becomes whether the predator funds, emboldened by the evident capping of gold in the $440s, will try to engineer a landslide. Gold’s friends can take some comfort from the fact that the general commodity terrain has not been less favorable for bear raids on gold for many years.

JB

CARTEL CAPITULATION WATCH

The DOW was waffly today and unable to hold gains. It closed at 10,626, down 7. The DOG rose a scant 1 to 2016. The big news could be on what I brought to your attention in yesterday’s MIDAS and it revolves around the Three Amigos. Fannie Mae (FNM) lost $2.47 to $54.48, General Motors (GM) gave up 67 cents to $28.34 and AIG was hit for $2.11 to $60.79.

To see their ugly looking charts, punch in their symbols below:

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

***

All of these firms have enormous derivatives operations. Should one or more develop some serious, off-side problems related to the staggering amount of derivatives they have on their books, it could eventually set off a daisy chain financial market disaster as it will surely affect their counterparties.

One reason I am harping on this is because of the extent of the obvious gold price rigging. It is far more aggressive and blatant than normal. The Working Group on Financial Markets is petrified of something. It is important to keep in mind they have rigged gold and other US financial markets at times for years, keeping volatility and the markets in check. By doing so, the complacency among the investing public (and probably that of Wall Street too) is off the charts. FEW out there are prepared for what I believe is in the works. It is going to get very NASTY when the US financial markets blow up. Only a matter of time.

On that score it will be important to keep track of other markets. As many of you know the credit spreads became very narrow due to investors seeking higher yields of return. Money went into corporate bonds and other investments like emerging markets. Well, with what is going on in Fannie Mae, AIG and GM many of these investments are unraveling. The credit spreads are widening and South American stock markets have taken a tumble:

*The Columbian stock market just dropped 18%.
*Argentina is down 13% since the beginning of March.
*And Brazil is down 7%.

I keep pounding the table that all hell could break loose at any moment. Time to be very vigilant on all of this.

The US economic news stinks:

04:08 Oil hits record $57.01 in New York
Note London Brent is also at a record $55.50.
* * * * *

09:18 OPEC President says consultations on 2nd OPEC output increase are possible in 7-10 days -- Reuters
April WTI crude closed overnight session at $57.22. NY session opens at 10 ET.
* * * * *

00:45 GM GM's bonds move closer to junk status reports the WSJ (29.01)
The 'Heard on the Street' column says the warning yesterday from GM reverberated through the bond market. Many funds will be forced to sell the bonds of GM if they are lowered to junk status in the Lehman U.S. Credit Index which requires two of the three major rating agencies remove it from investment grade. Some analysts point out that the prices of several of the bonds already are priced in the junk range accurately reflecting the risk. A key question is if the troubles are a market issue or GM specific.
* * * * *

08:17 SGG SGG to raise prices across its entire carbon fiber product range (4.54)
Partly due to higher raw-material costs, the company will raise prices by at least 10% with the increases varying from product to product.
* * * * *

08:30 Jobless claims for week ended 3/12 reported 318K vs. consensus 315K
Prior week revised to 328K from 327K.
* * * * *

10:00 Feb. LEI reported 0.1% vs. consensus 0.1%
Prior report was (0.3%).
* * * * *

12:00 Philadelphia Fed index 11.4 vs. consensus 20
Prior reading was 23.9.
* * * * *

12:02 Philadelphia March Fed New Orders Index 13.2 vs. Feb. 11.7

Philadelphia Fed Manufacturers Report Slower Activity

PHILADELPHIA, March 17 /PRNewswire/ -- Federal Reserve Bank of Philadelphia today issued the following:
Activity in the region's manufacturing sector continues to expand, but at a slower rate than in February. Indicators for general activity, shipments, and employment show a more moderate pace of growth. Firms continue to report a rise in prices for inputs and for their own finished goods, although the survey's price indicators have moderated from recent highs. The region's manufacturing executives were slightly more optimistic this month than in February.
Manufacturing Expansion Continues
The diffusion index of current activity, the broadest measure of manufacturing conditions, decreased from 23.9 in February to 11.4 in March. This is its lowest reading in 20 months…

-END-

In late:
Fannie Mae says will file late annual report

WASHINGTON, March 17 (Reuters) - Fannie Mae on Thursday said it will not file its annual financial report on time with securities regulators, the latest disappointment for the embattled mortgage giant as it faces federal probes into accounting problems.

Fannie, in a filing with the U.S. Securities and Exchange Commission, said it has not completed financial statements for 2004. -END-

Jesse on why we need to cut back on Social Security:

We need to increase our payments to corporate welfare.

"A Halliburton subsidiary, Kellogg, Brown and Root, faces a number of investigations for overcharging, including one case where it charged the Army more than $27 million dollars to transport $82,000 worth of fuel from Kuwait to Iraq, according to excerpts of the report released this week by Rep. Henry Waxman (D) of California.

In a written statement. Halliburton defended the cost, explaining that delivering the fuel was "fraught with danger."

-END-

One reason oil is trading the way it is:

Hi Bill,
An intervention rule, which doesn't allow 2 consecutive upside days of volatility where the 2nd day is either muted or a reversal day, appears to be in full force in the crude oil market. Although it is still early, oil may be allowed to rally this afternoon if the interventionists are able to support the stock market.

When oil trade decisively above $40 last year, it should have become a runaway market. However, that didn't happen due to the interventionists. Now with yesterday's upside breakout, crude should again become a runaway market. We will see what happens this time, however, I don't believe the interventionists will allow this.

Why should crude oil become a runaway market?

Because most of the major producers that were able to sell future production forward, probably did so to the limit and then some.

I don't believe any energy executives predicted +$40 crude oil last year and certainly didn't predict +$60 this year with the potential for +$90 this year or next. As of January 2004, I believe every major oil company was looking for oil below $32 and most looking for oil below $30. As a result, all forward production that could be sold, probably was sold at $40.

When major producers have sold forward substantially, they have less to sell in the cash and futures markets going forward. This results in runaway markets when a market trades at new all-time highs. And this is without consideration of the demand side of the equation, which is substantial. So, when you see crude oil drop $1 in a matter of minutes without news, it is unlikely that big oil is doing the selling. It is most likely the interventionists.

The 'talking heads' appear to be puzzled that crude oil prices continue to increase with each OPEC announcement of production increases. What these 'heads' fail to realize is that these OPEC announcements are probably baloney, like the inventory numbers and are nothing more than cover for market interventions. Additionally, it appears that traders are coming to this conclusion buying on the bad news.

All the best,
Raymond Green
RGreen@ilnk.com

PS - I notice oil rallied to the highs of the day only to be hit for $1 in the last minutes of trading. Looks like the interventionists will not allow a runaway market. If it were, historically, crude oil would be above $100 in a couple of months.

On naked shorting:

Bill, I'm a GATA member. I have a friend in San Diego, who asked me today to read an article by Patrick Byrne, PhD, CEO, overstock.com. at http://www.ragingbull.com/ , stock: rstg, posting #2217. In this posting is info about Patrick Byrne's attempt to get info from Depository Trust & Clearing Corp (DTCC). He was seeking info not only about naked shorting of his company, but about the extent and magnitude of the total amounts of naked shorting as such relates to the reporting requirements of Reg SHO. He discusses the collusion between Hedge Funds and DTCC, the allowance of Hedge Funds to continue to operate illegally while the DTCC turns its head, etc. You might want to take a glance through this. It ties in to all of the other manipulative practices currently going on by the SEC, et al.
Ken Kemp

I have heard Patrick Byrne speak on the radio. Very impressive fellow.

Rhody on leasing:

Hi Bill:
Gold lease rates are back in backwardation, not because the near terms rose, but because the middle terms fell slightly. The elevated near term gold lease rates persist, indicating high levels of leasing. Leasing in the near terms means spot price repression.

Silver lease rates jogged back up again in the near terms while also falling in the longer terms. Again we have persistent pressure against the silver spot price.

Both gold and silver lease rates are still low from a historical perspective.

This suggests abundant liquidity. Although abundant physical supplies may be true for gold, it hardly applies to silver. There are increasing signs of a chronic bullion supply tightness in United States and European dealer sources. In fact, bar silver cannot be purchased in size, nor do many coin/bullion dealers even carry physical in bullion form. So where is the silver coming from to maintain these low lease rates? I don't think it's China. The only central bank that has any silver in size is the central bank of India with 86 Moz, but they are constitutionally forbidden to dispose of it.

The only large hoard of physical silver left on the planet is COMEX stockpiles.

Could COMEX stockpiles be leased? I know that COMEX vault storage fees are the world's highest and I know that leasing is a common way to offset vault fees in other storage providers. It is logical to speculate that COMEX silver, at least the eligible stocks may be the source of leased silver. If this is true, and I was an owner of said silver, I would be pulling my metal out of COMEX as fast as I could make the arrangements, because in a structural deficit, there is little chance that leased silver can be returned. What owners of eligible COMEX silver need to ask themselves is whether they really want to be cashed out of their silver at well under $10 per ounce.
Regards, Rhody.
http://www.kitco.com/market/lfrate.html

Let’s hear it again for the two Finance Minister Gold Cartel sycophants, Brown of England and Manuel of South Africa, who are spearheading the effort to have the IMF sell gold to help the poor. One minor detail and problem with their scheme. Just talk of IMF selling gold is hurting the price, which is too low already, and SA gold companies are laying off workers, which is hurting the poor badly and could potentially become a "crisis":

http://Www.Iafrica.com

LABOUR
Nearly 20 000 jobs on the line
Posted Thu, 17 Mar 2005

Nearly 20 000 people could lose their jobs in the next two months, according to trade union Solidarity.

"We regard this as an employment state of emergency," said Flip Buys on Thursday, the union's general secretary .

This trade union is currently negotiating with 25 companies against the retrenchment of 18 293 workers, mostly in the mining, chemical, telecommunications and metal industries.

A further 1500 jobs were threatened in individual cases, said spokesperson Dirk Hermann.

Strong rand hurting companies

He said Solidarity had appointed a commission of enquiry into the economic rationale behind the retrenchments, which the companies concerned were blaming on the strong rand.

The commission would also look into possible ways to "lessen the impact of the crisis".

Solidarity is arguing that something must be done to lessen the damage wreaked on thousands of families by the effects of a strong rand.

"If a natural disaster causes economic disruption to 20 000 people, a state of emergency is declared. We accept that certain underlying economic factors cannot be altered, but I have never heard anybody say that because a natural emergency cannot be averted nothing can therefore be done for the victims", Buys said.

Major retrenchments in mining

The major retrenchment would be in the mining industry, Hermann said.

At Harmony Gold mines, 4914 workers might be laid off.

DRDGold has said that the jobs of 6513 workers are at stake….

http://business.iafrica.com/news/817120.htm

-END-

Each mine worker supports 10 to 12 others. Nice work Brown and Manuel.