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

The week is not over , don't open the champagne yet.

Gold is only $4 short of $500 and the Dow is not far below 11,000.

No one seems either jubilant or alarmed. Instead, a sort of stupid
numbness has settled over investors. All the news, no matter what it is,
reassures them.

This attitude of reckless complacency must be a product of the Great
Moderation. The Fed has proven that it can control the business cycle,
says Fortune. Over the past 20 years, crises have come and crises have
gone. Each crisis deftly managed by the Fed and none disturbed the
underlying tranquility of the world's financial system...or shook
investors' faith in the people who run it.

Of course, the confidence is not limited to investors. Ordinary
householders are now leveraging themselves as if they were Jesse
Livermores; they are sure that nothing bad will happen.

"Holiday shopping +22% over weekend," reports the FT. So far this holiday
season, people are spending nearly a quarter more than they did last. What
is remarkable about this is that it seems so out of place next to the
other news items in the paper. Elsewhere, we discover that household
earnings are falling for the second year in a row (not news to us) and
that average hourly wages are no higher in 2005 than they were in 1973
(again, not news to us).

How can people who earn less spend more? Of course, that is merely a rhetorical question; we already know the answer.
They do it by going
further into debt. They are confident to a fault - unflappable,
immoveable, almost as if they were dead. While obvious, the fact of it
bothers almost no one - your editors excepted. The rest of the world
believes, as Fortune put it: "It is the sheer free-market vibrancy of the
U.S. economy that will probably be its greatest strength in the decades to
come."

But it is our sad lot in life to remind readers that things do go wrong
from time to time, free market vibrancy or not.

If the last 10 years have been a period of "Great Moderation," the 10
years of the late '60s and early '70s must have been a time of "Great
Extremism."

There was a, "Stampede out of paper money," reported Roger Eglin in The
Observer, on the March 17, 1968. "Spurred on by greed, fear, hysteria and
ignorance, European civilization's seams were creaking.The French threw
their urbanity out of the window and punched and fought like animals to
get gold. Men in Throgmorton Street and around the City (London's
equivalent to Wall Street) were desperately worried."

They had good reason to be worried; the world's financial system seemed to
be breaking down. Merchants were reluctant to take dollars; international
exchanges were blocked. Travelers were stranded without cash.

"Even having the money with you can still bring problems," Eglin
explained. "People are getting frightened by the sight of foreign
currency. The Hilton hotels in Rotterdam and Amsterdam are not changing
foreign currency for guests, although they will take it for
bills...'People are no longer prepared to hold money,'" Eglin quoted a
broker, "It's an expensive process holding gold, but it's a better
short-term holding."

"No one wants to tough paper - especially anyone else's - unless he is
forced to do so. The confidence that props up the international money
system is being eroded. Once this starts it could spread like wildfire."

He was referring to non-Americans. Holding gold in the United States was
still against the law.

"The mighty dollar," Eglin continued, "once the lingua franca of world
money, has caught the plague. Dutch bank managers for 10 days have been
telling their clients to get out of dollars and into guilders or marks.
One London merchant bank ditched its dollars for marks earlier last
week.Panic is even creeping in. Last week a London hotel would not take
payment from a party of Americans in dollars or Swiss francs."

The years of the Eisenhower administration were calm. Readers will wonder
what happened to cause such a landslide in confidence. Was not America on
top of the world in the Johnson Administration, just as it is in the time
of Bush? Had we no central bank with a genius at its head? Did not the
U.S. economy vibrate then...as now?

Again, we only ask the questions because we like the sound of them.

Then, as now, the United States was increasing spending at a breathtaking
rate. The war du jour back then was in the jungle, not the desert, but the
landscape of domestic spending was almost exactly the same as it is today.
If anything, the dollar should have been stronger then, than it is now. At
least in the 1960s, voters, householders, and legislators still felt they
should pay their bills. Lyndon Johnson proposed a 10% tax increase to try
to bridge the gap between outflow and income. It was rejected by Wilbur
Mills, head of the House Ways and Means Committee. He wanted guns and
butter, too, but he knew the taxpayers wouldn't want to pay for them.

And so, the matter was thrown onto the international financial markets.
Especially in Europe, people still recalled how quickly things could get
out of control. In Germany, in the 1920s, the price for a beer rose before
it had been drunk. Inflation set off a "flucht in die sachwerte" - a rush
into material things - that was remembered even in the '60s.

The favorite material thing in such times is gold. Pressure on the gold
price forced the Nixon Administration to drop the last vestige of gold
backing for the dollar in 1971. Over the next nine years, the price of
the yellow metal rose 2,000 percent, and mortgage rates hit 18 percent.

Eventually, markets settled down. And now, after such a long stretch of
"moderation," extremism is underestimated, under-appreciated, and
under-priced. But does this mean that modern Americans will never flap
again? Again, another rhetorical question.

More news from our currency counselor.

Gold on 28 Nov, 2005, at 19:49 [New York Time]

$501.10 (up $2.80 from previous day's close)

Nach langen Kampf wurde diese Marke gestern erreicht, jetzt wieder bei 499 USD.

Le Metropole Members,

By Bill Jamieson
The Scotsman, Edinburgh
Monday, November 28, 2005

http://business.scotsman.com/index.cfm?id=2313142005

Higher still and higher climbs the price of gold. It closed up late on Friday at $495.70 an ounce in London and was even higher in Hong Kong.

Since the start of the month, the precious metal has gained almost 9 per cent, and there is growing confidence among traders that it will break $500 before too long.

This is all deeply embarrassing for our chancellor, Gordon Brown.

Remember how some six years ago he declared he would sell 60 percent of Britain's gold reserves held by the Bank of England?

Many suspected the exercise was designed to inspire confidence in the then soon-to-be-launched European single currency. This was because some of the proceeds were to be earmarked for the purchase of euros.

In due course, Brown sold off 300 tonnes at just $275 an ounce -- close to a 20-year low.

Roughly a third of the proceeds were then invested in euros - which then proceeded to plummet.

The gold price did not do much for a time. Now it has enjoyed a stunning rally.

The result is a stonking loss on those Gordon Brown gold sales. In fact, the Chancellor's disastrous foray into international asset management now looks to have cost the British people some £2 billion.

One point he could enter in mitigation is that he was not alone in this error. Other European central banks also sold down their gold holdings. There was much conceit around at the time about the coming emergence of the euro as the world's reserve currency.

Gold, by contrast, was a barbarous relic, one whose presence in the world monetary system had persisted out of superstition rather than logic. And unlike government bonds, it paid no interest.

But gold has systematically defied all attempts to expunge it from the vaults of the world's central banks and from its perch as a haven of last resort for millions of savers round the world.

Unlike many currencies, it is universally recognised as a store of value. It is readily accepted in exchange for goods and services. It is an excellent hedge in times of uncertainty and instability. And, again unlike currencies, gold cannot be printed to order to help debt-laden economies off the hook.

The latest surge is a reminder of gold's powerful global appeal. The recent price strength has been due to continued demand from India and China.

And it might also reflect, too, anxiety over coming instability in the world's currency markets. Many traders do not trust the burst of strength of the US dollar over the past year. The US currency was widely predicted to fall sharply. Instead, it has been hitting new two-year highs against the euro. Yet the twin deficits problem has not gone away.

How strange that, despite all rhetorical declarations to drive out gold from the vaults of central banks, its presence persists and, indeed, looks set to increase in central banks vaults across Asia.

The strength of gold - and its lasting appeal to central banks - is the subject of an informed analysis from fund management group Bedlam (http://www.bedlamplc.com/). I was struck by some outstanding graphic showing how western governments still love gold - euro area governments hold some 39 per cent of official gold holdings and the US 26 per cent.

All the world's currencies, its says, are now "fiat" money, that is, they lack any intrinsic value so are supported by faith, PR spin and little else.

There's nothing wrong or, indeed, unusual about this - just so long as politicians and central bankers act prudently and do not flood the world with worthless notes.

Might the current era of a total acceptance of fiat money be drawing to a close? Asian bankers may prove the key trigger as they seek to diversify out of the dollar. The excessive monetary printing that has already taken place looks set to drive the gold price higher, as are confiscatory, anti-wealth taxes by governments. This is one of the key reasons why gold remains so popular in continental Europe: it is an excellent means of storing wealth without the authorities knowing.

Bedlam's conclusions are thought provoking. It foresees an unsteady rise, with the possibility of a blowout in 2007-8.

There are only 153,000 tonnes of gold above the ground and a maximum of 2,500 tonnes a year from mine supply. It sees only a low chance that in 2006 the gold price averages much below $450.

Modest forecasts suggest a 15-20 per cent gain by end 2006, or more than three times the UK's current government long bond yield. So some diversification into gold may start to appeal. "It is certainly less naive," it says, "than the investment industry's present consensus that government IOUs are a risk-free investment."

-END-

All the best,

Bill Murphy
Le Patron

@ all und insbesonder die Moderatoren.

Ich möchte Euch die Lektüre der heutigen FAZ empfehlen, die ja manchmal zu Recht hier kritisiert wird. Es gibt dort einige sehr interessante Meldungen und Berichte, die ein Schlaglicht auf unsere Finanzverfassung werfen.

1. "Goldpreis kratzt an der 500-Dollar Marke" Aufmacher des Finanzmarktteils auf S. 23, m.E. sehr gut geschrieben

2. S. 24 Bericht über Südafrikas Aktienmarkt mit Bezug auf Goldproduktion

3. "Junckers Einmischungen" Glosse auf S. 13 Einmischungen der Politik in EZB Entscheidungen

4. Leitartikel auf S. 13 zum EU-Zucker Plan für unsere soft commodity Freunde

5. "Hedge-Fonds "nicht unbedingt" bedrohlich" S. 14 Ein Bericht über eine Studie des Banking Supervision Committees zur Rolle der hedge Fonds im Finanzsystems. sehr aufsschlußreich

6. "Brasiliens Regierung streitet über Wirtschaftskurs" S. 14 Bericht über die Lockerung der brasilianischen Wirtschafts- und Finanzpolitik, neuer boom and bust Zyklus beginnt

7. "Euro-Austritt lohnt sich nicht" S. 15 Bericht über eine Studie von S&P über die Folgen des Austritts von einigen Mittelmeerländern auf ihr rating
- Wie ihr euch denken könnt, sehe es in diesem Fall nicht gut aus.

8. "Die verkehrte Welt der Gewerkschaften" auf S. 22 Ein Bericht über die angeschlagenen Hypothekenbank (AHBR). Der damalige Vorstand hatte sich mit Zinsderivaten verzockt.

Im Ergebnis, dieses Mal eine wirklich gute Ausgabe der FAZ. Die Dichte der Artikel, die sich mit den von uns hier immer wieder diskutierten Themen beschäftigt, ist m.E. ein Indiz, daß die Negativentwicklung Fahrt aufnimmt.

Im Spiegel von Montag gibt es noch einen Artikel über Gold Explorer.

Viele Grüße

liberty

@ Thai Guru

Schoen von dir wieder vorbeizuschauen, bald bin ich dort wo du angeblich bist, in Thailand. Ich freue mich riesig ebenfalls das zumindest kurzfristig die 500 USD erobert wurde. Ich habe noch zum Abschluss meinen Senf zu gewissen Sachen hier im SA thread und Goldy's dicke Ende fuer Gold thread abgegeben die raus mussten.

Machs gut und melde dich bald wieder, am besten schreibe taeglich.

Gruss

Eldo

Übernahmefieber im Goldgräberstaat Nevada:

http://www.goldinvest.de/publi…&sc=&i=&y=5111&s=&offset=

Welche Goldmine ist die nächste ?

@Thai Guru,

schön Dich mal wieder hier anzutreffen.

Viele Grüße

Silbertaler

Hallo Thai.

auch grüsse von mir nach Thailand

Nachdem was Du hier aufgebaut hast,würde ich mir wünschen,mal öfters was von Dir zu lesen.

Bleib gesund!!

grüsse

Kalle

Hallo Thai,

Alles Gute, bist ja bald wieder da, sind nur 30% :))

Gruss
midas

... einige hatten hier schon Schlimmes befürchtet.

Anyway, wellcome back aboard. Oder einfach schön, dass du wieder hier bist.

Gruss

Germoney