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

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NEWS

Gold says reports of Norilsk arrest are untrue

May 3, 2004

By Sherilee Bridge

Johannesburg - Gold Fields, the world's fourth-largest gold producer, confirmed at the weekend that the controlling shareholder of its newest shareholder, Norilsk Nickel, had not been arrested.

Andrew Davidson, a spokesperson for Gold Fields, said on Friday that the company had been in contact with Russia and was confident that reports that Vladimir Potanin, the head of Norilsk Nickel's parent company Interros Holding, had been arrested were untrue.

The rumours were that Potanin had been arrested in connection with Norilsk's $1.16 billion (R8 billion) acquisition of Anglo American's 20 percent stake in Gold Fields.

According to news agency Bloomberg, no warrant had been put out for Potanin's arrest, and Gold Fields was unable to confirm whether the Russian tycoon had been called in for questioning. While unconfirmed, the rumours of the arrest shaved $2 billion off the market capitalisation of Norilsk since Wednesday.

Gold Fields stock climbed on Wednesday but then slid sharply in the last two days of the week to close at R70.25 on Friday, in line with the gold mining sector's 0.61 percent decline.

This led Russian market analysts to believe that the rumours were manufactured to benefit speculators.

Traders quoted by Russia's Kommersant newspaper said the story of Potanin's arrest had been circulating for a few days.

According to the news report, it was spread by "one large investment company, which called its clients to tell them that Potanin had been summoned to the prosecutor-general's office".

Both the company and the prosecutor-general's office denied the questioning.

Potanin left Russia for Israel on what his company said was a scheduled business trip.

koenigstreuer

Zitat

Am effizientesten könnte China sein Verschuldungsproblem durch den Kauf von Gold lösen, welches zur Sicherung der Passiva der Zentralbank dienen könnte. Sollte der Goldpreis im Zuge einer Finanzkrise in den USA bis auf 1000 USD laufen, so wären die Probleme im Binnenmarkt Chinas nahezu vollständig gelöst.

Genau das machen die Chinesen bereits seit geraumer Zeit

Sie kaufen physisches GOLD!!!!!

wasserzeichen

Zitat

Fazit

Es steht außer Frage, dass Gold zur Absicherung gegen Inflationsrisiken, aber auch zur Wertanlage in jedes vernünftig ausgewogene Depot gehört. Clevere Investoren sollten sich also in diesem Sektor positionieren. Um spektakuläre Kursgewinne zu erzielen, geht nichts über kleine Explorationsfirmen, die nach neuen Edelmetallvorkommen suchen. Wer früh genug investiert, kann im Erfolgsfall dank der Hebelwirkung stattliche Gewinne verbuchen. Allerdings dürfte sich der weitere Anstieg von Gold - wie man aktuell sieht - nicht ohne Rückschläge vollziehen. Kursrückgänge betrachten wir aber als gute Kaufgelegenheiten.

Yves Tölderer scheint die Zeichen der Zeit ebenfalls richtig erkannt zu haben!

Gruss

ThaiGuru

Spieler0815

Die gemachte Aussage in Deinem Posting Nr. xxx (Eine fortlaufende Nummerierung fehlt leider bei Goldseiten.de), dass die Papier Spekulanten, dank des Silber Cabals 1.7 Billionen US Dollar verloren haben, war wohl für mich wirklich die Einprägsamste Zahl.

Mit diesem Verlust hätte man ca. 250 Millionen Unzen physisches Silber kaufen können.

Theoretisch wenigstens, praktisch wäre das mangels Verfügbarkeit von physischem Silber innerhalb kurzer Zeit ganz und gar unmöglich. Vorderhand zocken die Anleger halt lieber noch mit Papier rum. Hätten die Hedgefunds, und die Spekulanten für die jetzt verlorene Summe von 1.7 Billionen Dollars, echte physische Ware gekauft, würden sie nichts verloren haben, ganz im Gegenteil, sie hätten das Silber Cabal in die Knie gezwungen, und Silber würde heute vielleicht schon mit 20 Dollar pro Unze gehandelt.

Aber das kommt auch noch!

Uebers Wochenende war ich beim Silber Einkauf in der China Town Bankoks. 925er Silber Granulat habe ich gekauft. 50 kleine Plastiktüten voll, alle etwa so gross wie zusammen knapp drei Packungen Zigaretten, nur etwas bauchiger, und rundlicher halt die Tüten. Die chinesische Händlerin hat mir diese Menge Silbergranulat nur gegen Aufpreis verkauft, mit der Begründung, sie müsse jetzt wieder nachbestellen, und das daure seit einiger Zeit bedeutend länger als noch vor wenigen Wochen. Zudem müsse auch sie bei grösseren Bestellungen jetzt ebenfalls einen Aufpreis bezahlen.

Alles klar?

Die Chinesen können seit einiger Zeit frei Gold kaufen, und das machen sie auch. Es gibt ebenfalls offizielle Daten zu den chinesischen Goldimporten. Habe bereits schon mindestens 2 Postings darüber in diesem Thred veröffentlicht. Habe leider jetzt die Zeit nicht um alle alten Postings zu durchforsten. Aus dem Kopf erinnere ich mich an eine Meldung der Regierung, die da besagt, dass es wünschenswert wäre, die chinesischen Goldreserven nach Möglichkeit pro Jahr um weitere ca. 10% auzufstocken. Eine weitere offizielle Meldung aus China besagt einen zukünftigen Gold Absatz, auf bis zu mindestens 600 Tonnen pro Jahr, innerhalb von ca. 10 Jahren.

Werde Dir nächstens diese offiziellen Verlautbarungen nochmals hier reinstellen.

Gruss

ThaiGuru

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May 3 - Gold $387.40 up 60 cents - Silver $6.01 down 4 cents

The Gold/Silver Trade Is A Buffet-like One

Zitat

Our greatest glory consists not of never falling, but in rising every time we fall...Oliver Goldsmith

GO GATA!

Shake your head time. The news over the past few days concerning Iraq is just horrendous. Nine more dead this weekend, apparent total confusion in Fallujah, and the further airing of the US torture, Iraqi humiliation pictures has done permanent Muslim-related harm which will last a decade. The worst part is the damage is done and cannot be undone, especially since the US sat on this for months. Air Force Gen. Richard Myers, chairman of the Joint Chiefs of Staff, had the gall to say over the weekend he had not even read the report on this mess yet. Are they sending it by Pony Express? Now more disturbing news comes out this afternoon about how the US has handled this disgrace:

BAGHDAD (AFP) - Former Iraqi human rights minister Abdel Basset Turki said US overseer Paul Bremer knew in November that Iraqi prisoners were being abused in US detention centres.

"In November I talked to Mr Bremer about human rights violations in general and in jails in particular. He listened but there was no answer. At the first meeting, I asked to be allowed to visit the security prisoners, but I failed," Turki told AFP on Monday.

"I told him the news. He didn't take care about the information I gave him." The coalition had no immediate comment about Turki's meeting with Bremer.

The minister, whose resignation was formally accepted by the coalition on Sunday, said he told Bremer about his meetings with former detainees.

"The prisoners I spoke to, they told me about how Iraqi prisoners were left in the sun on US bases for hours, prevented to pray and wash and left for two days on a chair and kicked at Abu Gharib," he said.

-END-

The ramifications for US financial markets are profound, yet Wall Street and the investing public do not seem to care. The DOW rose 88 to 10,314 and the DOG jumped 19 to 1038. The dollar went up .34 to 91.02, as did the bonds, up 3/32. Meanwhile, the sillies on Wall Street are more concerned with the Fed taking a virtually meaningless word like "patient" out of its statement tomorrow. Rome is burning and Wall Street is focused on a word. For the most part the Fed is very predictable. Just take a consensus on what the investment/commercial banks want to hear on Wall Street and you generally know what the Fed is going to say. What these "Lolas" want, these "Lolas" usually get. Anything to soothe the major financial market players.

Oil is one market which is paying attention to the latest Mid East developments as crude ended up in contract high ground at $38.21 per barrel, up 83 cents, a 13-year high close.

Considering what is going on in the world, gold should be flying, which is just the reason The Gold Cartel is sitting on it (Goldman Sachs sold again today early on), which, in turn, drew in more fund selling (later in the day).

June crude oil daily:

http://futures.tradingcharts.com/chart/CO/64

Technically, oil is set to explode.

Oil monthly

http://futures.tradingcharts.com/chart/CO/M

The CRB rose 2.72 to 275.26.

The euro fell .24 to 119.26.

The gold open interest fell 1444 contracts to 245,872.

Silver dropped another 22 cents early, stopping exactly at its 200-day moving average, suffering from another bout of spec liquidation, then crawled its way back to finish above $6.

The silver open interest fell 3840 to 97,865..

There were 684 more silver deliveries. Am still scouting around in attempt to determine what this really means.

The volume today in both and silver was extremely light as many in the gold world were off for a May Day holiday.

News from overseas continues to be very positive as gold demand continues to surge in many circles.

MIDAS SPECIAL:

In early 2000 Warren Buffet was criticized by a number of pundits as having lost his touch because he was not participating in the Nasdaq mania. Less than two years later, after the DOG had collapsed, he was extolled for his acumen. A few weeks ago with the stock market riding high, I noticed vestiges of the same sort of commentary about his short dollar position as the dollar was in strong recovery mode. Commentary by a bunch of lightweights never phased this investing genius. At his annual convention this Saturday Buffet announced, not only was he not backing away from his short dollar bet, he was increasing it:

May 1 (Bloomberg) -- Billionaire investor Warren Buffett said he increased his bet against the U.S. dollar on concern that the country's trade deficit will weaken the currency.

Zitat

``We think that over time that the dollar is likely to decline in value against some of the major currencies,'' said Buffett, 73, in an interview before Berkshire Hathaway Inc.'s annual shareholder meeting in Omaha, Nebraska. In the last few months, Berkshire has added ``

more than a little bit'' to its foreign currency holdings, he said. They were last disclosed at $12 billion as of yearend.

Foreign currencies represent Buffett's biggest purchase in the last two years. The Berkshire chairman has built a fortune buying undervalued assets and today sees little opportunity in stocks. He bought currencies as the dollar began a 25 percent slump over 24 months and the U.S. current- account deficit ballooned to a record quarterly average of $137.7 billion in the first nine months of 2003.

-END-

The man is worth $42 billion dollars and has made this incredible fortune by doing his homework and understanding the fundamentals of what was really going on in the investment world. He doesn’t pay attention to the Wall Street hype and posturing. Once he figures out what "the deal is" through his own (and staff’s) evaluation, he makes a bet and stays with that bet until it works out. He might even add to that bet as he has just done in currencies. What is important, as far as I am concerned, is that he usually stays with his investment until it plays itself out. As we have learned from his record, that might take many years.

This is the approach I have advocated for gold and silver investments since The Café opened in September of 1998, the Buffet approach. From the dog days going into 2002 until the heights of December 2003, I probably ran up unrealized gains of say 1000%. During the last four months 40% of those gains have been given back, painful but not devastating by any means. From these levels on in, I will be shocked if the 1000% gain mark is not exceeded by this fall and does not rise to a total gain of 3,000 % some time by the end of 2005.

The point is times like these are very tough to go through, but necessary along the way to eventually get to that 3,000% gain number. For those who can successfully get in and out during the move, my hats off to you. Surely, in retrospect, it was the right thing to have exited gold/silver plays last December, but there will come another time when gold/silver will begin to dip again, look like this last correction, and then explode, never to look back for more than a decade. Those who stepped aside at that time are likely to miss the most dramatic part of the move and the easiest money of all as the public pours in to buy up this little market.

Getting back to Buffet and his type of analysis. Let us review where we are here regarding gold as far as the big picture is concerned, a picture which is rarely talked about.

Most of the investing world believes the central banks still have 32,000 tonnes of gold. That is the most bandied about number we hear of from commentators. Yet, we know The Gold Cartel and other bullion dealers have surreptitiously squandered 16,000+ tonnes of that gold via various gold lending/swapping operations. This exited gold was used to suppress the gold price since the mid-1990’s. Meanwhile, the IMF has instructed its member banks to hide this fact from the investing public by instructing central banks to show this lent/swapped gold as actual gold reserves on their books. This is the dirty little secret The Gold Cartel doesn’t want the public to know.

Yes, the number could be 17,500 tonnes by now (we have been using 16,000 tonnes as a high estimate for more than a year), however, 16,000 tonnes is a more conservative way to go for this exercise.

This means the central banks only have 16,000 tonnes of gold left. Of that 16,000:

*The US has 8,000 tonnes and says none of it has been lent or swapped. This is highly debatable, but will take US officials at their word for the moment.

*The IMF has 3,000 tonnes. It too says it is all there and it would require an Act of Congress for the IMF to sell any. The last time they suggested IMF gold be sold, it activated all kinds of Republican and Democratic leaders in Congress to go against the proposal.

*The Swiss say they will not sell their last 1700 tonnes once they finish their recent selling bout.

*The French have 3000 tonnes, and while their have been some noises lately about their doing some selling, it is not very likely, and if they do, it won’t be that much.

Add that up and you come to 15,700 tonnes. If the above facts are all true, it would suggest The Gold Cartel is about to hit the wall. It means all the other central banks have already lent or sold all their gold like the Canadians, Norwegians, Australians. We know that is not the case, so it strongly suggests the US or IMF has had its hand in the lending pool. However, this is not critical as to where I am headed with this.

The yearly supply demand deficit is probably running between 1400 tonnes and 1700 tonnes per year, meaning gold demand exceeds mine and scrap supply by that amount. At that rate the central banks would run out of gold in around ten years. We know this will not happen. What it does tell us is The Gold Cartel must very nervous about the size of the growing gold short position with the realization it is going to have to be accounted for in the near future.

Since it is a virtual impossibility other central banks have sold/lent/swapped all but 300 tonnes of gold, it most likely means the US or the IMF is lying about their gold mobilizations.

It also suggests The Gold Cartel must realize they cannot carry on their scheme much longer. The stakes have become too great, the risks too high. At some point this is going to become known to more and more investors, as well as to governments, and The Gold Cartel will not be able to hold the price down as a gold buying panic sets in.

Thus, the pertinent question is not where the gold price is going, but how soon? I suspect it is sooner than most people think and this latest move down was orchestrated by the cabal with this in mind. For The Gold Cartel and others to even begin to cover some of their shorts, they needed to get the specs out of their long positions and turn a number of them bearish, which is just what they have done.

To take this a little further, I bring your attention to part of a presentation Frank Veneroso made to the GATA African Gold Summit on May 10, 2001 in Durban, South Africa. James Turk, Reg Howe and I also made presentations. At the time gold was $265 per ounce and Silver $4.35 per ounce….

http://www.lemetropolecafe.com/pfv.cfm?pfvID=1525

Now, in addition to the above three corroborative bodies of evidence we did a little bit of field research---we have had other people make inquiries with bullion bankers. (We went to other parties to make the inquires, since we feared that, as analysts, these dealers would be less forthcoming with us.) Some of these bankers had left bullion banking, some had been fired and felt disaffected and inclined to speak, some are still employed. In any case, they were willing to talk. We have gotten, albeit crude, estimates of gold borrowings from the official sector from about 1/3 to 1/4 of all the bullion banks. We went to bullion dealers and we asked, "Are these guys major bullion bankers, medium bullion bankers, or small scale bullion bankers?" We classified them accordingly and from that we have extrapolated a total amount of gold lending from our sample. That exercise has pointed to exactly the same conclusion as all of our other evidence and inference---i.e. something like 10,000 to 15,000 tonnes of borrowed gold.

So I have now given you 6 completely independent pieces of evidence that a hell of a lot more gold has left those official vaults than the consensus would contend. This implies that the flow, the draw down rate, the liquidation rate from official gold stocks is substantially higher than what the consensus contends.

Now let us put these two suppositions together. Remember our pie chart--- a big chunk of the official gold reserves reported to the IMF has already gone. Remember our supply/demand balances---this outflow on an annual basis is substantially larger. Now, let us project forward. First of all, as the years pass, global income will rise. At a constant real gold price we could then expect demand would rise somewhat. At the same time the current very low gold price is close to the total cost of production and we are having less exploration. We have more or less exhausted the pipeline of projects that we created through higher exploration expenditures years ago. Also, cash flow strapped miners are high grading the eyes out of their mines. Mines deplete in any case by about 7% a year. Mines are depleting more rapidly now because miners are high grading. In essence, we are not coming up with new projects to replace what is being depleted, and depletion is occurring at a rapid rate. Overall we can expect mine output will fall over time. Therefore, we can assume some growth in future demand, we can assume some decline in supply, so that the deficit in the gold market---that rate of flow of gold out of the central bank vaults---should increase in order for the gold price to remain at its current level in real terms.

Now, we will make two sets of assumptions. First let us take the current rate of drawdown and project it forward. Second, let us also assume some growth in that rate of drawdown. Let us then take our estimates of what is left in them thar' vaults and figure out how long this process can go on.

First, we take our conservative numbers--- our lower rather than our higher estimates of gold lending. Here we project how long this process can go on if we assume no growth in demand and no decline in supply and conclude it will take a decade to empty the vaults. In this alternative projection we have assumed some growth in demand and some decline in supply. It will take about 7 years to empty the vaults.

If we use our more aggressive numbers, we have less in those vaults and it is flowing out at a faster rate; consequently, it takes less than seven years to empty the vaults. So whatever is happening in the gold market--- whatever is keeping the gold price down---if our numbers are correct, it can't go on that much longer, because we know not every central bank will lend or sell all it's gold. In fact, if our analysis is correct, the official sector knows what is coming. If the official sector is rational, it knows what will happen to the gold price when this large flow that is depressing the price abates and ultimately ends---the price will go up by a lot. Therefore, some rational central banks will not sell and lend down to the last ounce. Instead they will start to buy.

So regardless of what has been happening in the gold market, if our data is correct, then, within a couple of years, whatever the official sector is doing, it will terminate and the gold price will rise.

-END-

WHICH, is just what the gold price has done the past three years. Now keep in mind Frank’s 10,000 to 15,000 gold loan numbers are THREE years old. At 1100 tonnes per year of new lending plus 400 tonnes of CB gold sales under the Washington Agreement to meet the supply/demand deficit, his numbers come up to 14,500 to 19,500. (The sales are compiled as loans for this exercise. Interestingly enough, 2000 tonnes of gold will have been sold under the Washington Agreement by September of this year. Anyone notice an official reduction of how much gold the central banks still have? I haven’t.) Now let us subtract a guesstimate of 1500 tonnes of gold producer short covering (thereby ending their loans) and we come up with 13,000 to 18,000 tonnes of gold loans still on the books. Cut it down the middle and we come back close to 16,000 tonnes again.

Three years ago Frank gave the central banks 7 to 10 years to empty their vaults. Now we are down to 4 to 7 years. Yet we know from what I presented above, this is not going to happen. We are not going to get close to emptying the vaults.

Therefore, I am thinking more and more this is The Gold Cartel’s last hurrah. As soon as they think they have done what they felt they had to do in this orchestrated attack, they ought to cover what they can with abandon and we should have a stunning gold rally which would shock most market participants.

What could be a better time than in the coming weeks? The specs have just pared 100,000 contracts from their long positions. Next Friday’s COT report should show them having parted with another 20,000 to 30,000 contracts. The gold market commentators (in toto) are about as bearish as they have been in many years. The physical gold market is VERY strong and the gold fundamentals are "10+++."

And, the run-up in silver from the mid $4’s to $8.46 was not for nothing. A market which has been comatose for many years does not run like silver did for many months into 17-year highs without some strong fundamental basis behind it. Clearly the price manipulators held the fort, capped the price on the way up and waited for the signal from others in The Gold Cartel to make their move to trash it. However, the run-up was a sign cabal forces have begun to lose control of silver because they are running out of physical supply. They won the recent skirmish, but if all the information is as right on the money, as I think it is, it won’t be long before the cabal is backpedaling once again IF they attempt to repeat their price control maneuvers. As it was earlier this year, a rising silver price makes it much more difficult for The Gold Cartel to control the gold price.

Back to Mr. Buffet again. The big gold picture play is just as powerful as it was months ago. We have gone through a trying correction, which should be playing itself out. After it does, gold should set its sights on taking out $430 on its way to $500. Those who trade this play like Buffet would are likely to be very happy campers by year-end and in the years to come.

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The John Brimelow Report

India, Turkey etc. springing trap?

Monday, May 03, 2004

Indian ex-duty premiums: AM $11.42, PM $12.37, with world gold at $388.10 and $388. Very high: far above legal import point. Reuters carries a story today deadlined Bombay confirming the magnitude of the surge in activity:

"…traders said…The country witnessed heavy retail purchasing in the past two weeks…. "The last two weeks have been fabulous," said Ranjeeth Rathod, a bullion dealer based in the southern city of Madras. "We have done business of two months in just 15 days." A drop in prices and some festivals in south India sparked retail buying, he said, adding that jewellers also replenished their inventory and investors made big purchases… Traders said gold demand in Bombay had surged to 800 to 900 kg per day from just 300 kg a month ago, while in Madras it rose to about 350 kg from about 125 kg. "Jewellery demand at the moment is very good as people are taking advantage of low prices," said Subhas Zaveri of jewellery firm Tribhovandas Bhimji Zaveri. "(JB emphasis).

(Reuters ran this story with the paranoia-inducing headline "India gold demand to fade on waning wedding demand". In fact, price is the key factor with India: the last time premiums persisted this high was in the early summer of ’99, when the alleged lull in Indian demand coincided with the BoE sale-induced panic low in world gold: imports were enormous.)

Other evidence of stimulated physical demand has appeared in the Pakistani press:

Zitat

""Currently, the import of gold in Pakistan is around 10,000 tolas daily, which has resumed last week after a gap of about one month," said Haji Haroon Chand, president All Pakistan Supreme Council Jewellers Association (APSCJA). "Imports are likely to rise up to 17,000 tolas per day next week.""

(A Tola is 0.375 of an ounce. See

http://www.dailytimes.com.pk/d…page=story_2-5-2004_pg5_3 )

Also Turkey: the Istanbul Gold Exchange reports that April gold imports were 26 tonnes, the highest this year, 24% above March and 82% above April last year. This was the fifth heaviest month recorded in the 9 years of data the Exchange web site offers.

Japan and China were both closed today. NY is estimated to have traded 55,000 lots.

Refco Research observes of Friday in NY:

Zitat

"From open on the COMEX, the soft tone in the dollar helped to propel June gold briefly above 390 as did pre-weekend short covering. That said, the June contract stalled in front of the 200-day average and then retraced."

Less restrained observers would point out that gold "retraced" by collapsing almost $2 from the level of most of the day as estimated volume jumped 28% in the last half hour: doubtless a professional short position being defended.

With the CFTC data from last Tuesday rendered virtually obsolete by the subsequent collapse in the gold price being brought into question by no reduction of open interest, the question of how large and how determined this short position is will clearly be tested by the physical market this week.

JB

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CARTEL CAPITULATION WATCH

THE INFLATION NEWS around the world is beginning to spiral higher and is picking up steam – from the US to Canada to Japan to Germany:

From the US:

May 3 (Bloomberg) -- A gauge of U.S. manufacturing held close to a two-decade high last month as growing demand spurred demand for factory goods, an industry report showed. –END-

What Bloomberg does not say in the recap of the ISM index is the level of the prices paid component in the index is at the highest level since 1979.

From Canada:

From the The Province (Vancouver, B.C.) April 30, 2004, Pg. A3

http://www.canada.com/search/s…a6-4828-95b9-442c077d8fa6

re. 2010 Winter Olympics Preparations

Spiralling Inflation Costs Delay Olympic Tendering

"I don't think there's enough money there to complete the venues." he said.

[Stuart] Howard, President of the Architectural Institute of British Columbia, cited the cost of forming concrete which has leapt from Cdn$ 5 a square foot 18 months ago to Cdn$ 12 a square foot today. –END-

From Japan, news which will affect US interest rates:

Japan stops buying dollars as economy firms

By Barney Jopson and David Ibison in Tokyo

Published: May 3 2004 5:00 | FINANCIAL TIMES

Japan's mammoth effort to curb the strength of the yen was abandoned in April when authorities ceased intervening in the currency markets for the first time in seven months....... The decision to end intervention sends out a strong message that Japanese policymakers believe the country's recovery from a decade of deflation is broadening from exports to domestic sections of the economy. It also promises to remove a growing source of tension with the US, where manufacturers have accused the Japanese government of keeping the currency artificially low to boost exports. However, the decision to halt purchases of US-denominated assets could have negative implications for US Treasury bonds, which have been boosted by strong buying from Asian governments, led by Japan and China......

–END-

From Germany, who caves on inflation:

Germany reneges on budgetary rigour to concentrate on growth
(03/05/2004)

http://www.afp.com/english/new…40503151107.t6a2jkyd.html

BERLIN (AFP) Dogged by persistently weak growth, the German government seems set to abandon its commitment to budgetary rigour and concentrate instead on pumping money into its wheezing economy, threatening to push the German
public deficit above EU limits again in 2005.

German press reports said Monday that Berlin was to make a dramatic turnaround and abandon its goal of consolidating its budget, as required under EU rules, in favour of growth.

Such a move would re-ignite a long-simmering controversy about the European
Stability and Growth Pact, a tight set of budget rules stipulating that eurozone governments are not allowed to run up public deficits in excess of 3.0 percent of gross domestic product (GDP)…… - END-

GATA’s Mike Bolser:

Hi Bill:

The Federal reserve added today May 3rd 2004 $7 Billion in temporary repurchase agreements, an action that depressed to repo pool down to 26.17 Billion. The DOW's 30-day ma continues to round back up even with today's lowered repo pool while the Fed continues also to support the index with a rising repo pool 30-day moving average.

Radiology

The radiologist is a doctor's doctor, giving medical advice to referring physicians based only on the results of image analysis. In doing so there is often a conflict between what the referring doctor sees clinically by examining and questioning the patient and what the x-ray and imaging systems reveal. In such cases the patient's true diagnosis may be hard for the referring physician to accept especially since it will be the local doctor delivering the news. Many radiologists go out of their way NOT to be influenced by anything other than the patient's images.

This is what I attempt to do in a small way with the repo metric. I don't listen to the Fed's pronouncements nor do I care what CNBC has to offer (I have symphony music on over Kernan's gibberish). I don't follow the standard technical analysis of Elliot Wave techniques because they are dominated by the effects of government intervention.

I do however, pay attention to what kind of failure mechanism we might expect as the intervention reaches its exhaustion phase. In this regard the ten-year and 30-year bond yields are important things to observe. They both reside near their recent highs of 3.6% and 5.3% respectively. As such the bonds are telling us that the interest rate tension is relatively high and at some time this year we will experience a break to higher ground in long term interest rates.

Gold led the way in the coming rate rise. That can be clearly seen in the rising DIVG's 200-day moving average. I cannot emphasize enough the importance of this metric, one I formally introduced in August 2003

http://www.gold-eagle.com/editorials_03/bolser081403.htm.

For those with precious metals investments that are lagging, a glance at the DIVG ought to give solace that the Fed is in a retreat not only in gold but they are preparing a major retreat in interest rates as well.
Mike

Chuck checked in on Friday night:

Today marked the 9th day out of the last 10 in which the XAU and HUI closed right near their lows. That is pretty impressive considering how much panic selling has entered the market since the beginning of December. That's exactly 6 months in which this action has persisted. Given the drop to near the 233 dma, the pervasive pessimism and crowing by the gold people who told people to sell, the sentiment indicators that you wrote me about yesterday, the terrible Fridays week in and out, the gap downs, the lousy closes, the strong dollar, and the refusal of this phony stock market to turn down (until recently) my conclusion is that we should be ready to resume the bull here. …..

It is amazing to me to read of the proliferation of the gold sells at this junction without a mention of the correlation between gold and the stock market. Hasn’t anyone connected the dots here? All of these people, Russell included want to cover their reputation by saying "sell" but saying that we're still in a bull market in gold. What doubletalk! The big event is on its way, and it won't delay any longer. We are going down, fast and hard. Barron's released their "big money" poll with 61% bulls and around 14% even with the technical disaster and the charts turning down perched at their 200 day moving average.

I am certain that the gold share market has made its correction such as in July 2002, and will start to move up again with intermittent down drafts as the liquidity of the stock market proves illusionary. It's astounding that so few see this thing coming now….

If this sentiment stuff, along with the amazing resemblance to the July 2002 crash, the stock market getting ready for the waterfall, the daily gapping down since December, the enormously oversold condition of the shares, the evaluation of the smaller companies as if they are going into bankruptcy, the amount of advisory public pronouncements that the HUI is going back to 110, the 1% plus sell offs almost every single day in the gold indices, the public bullishness suddenly in the dollar, then we should sell everything and buy Google on the public offering.

What a market and what a set up! I am expecting some shocking fireworks here. Chuck

From The King Report:

Wall Street and its propaganda wing in the financial media issue insight, conventional wisdom and comment everyday, whether it’s significant or not. Yet they consistently overlook or ignore salient events and stories. On Friday, the WSJ on page 2 had a Greg Ip article entitled Fed May Have Acted on False Alarm. The article reports an Atlanta Fed study suggests that Easy Al and Fed deflation fears between 2001 and 2003 were misguided because the weakness in CPI was due to large declines in rents and used cars. "The study finds that two-thirds of that decline in the core inflation rate reflected slowing increases in rents and rapid declines in used-car prices." Ex-rents and used car price decreases "core inflation today would be 2.7% instead of 1.6%." And that means GDP is overstated by 1.1%.

We’ve inveighed about the absurdity of rents being 32% of CPI and how Mannheim Auto’s millions of transactions/year show BLS error in its used car prices. Now the Atlanta Fed has joined the chorus, albeit with a softer melody. The Atlanta Fed notes that Easy Al’s assault on interest rates forced people out of apartments and into homes; and auto-company zero rate financing created a rush into new cars, suppressing BLS CPI…The study opines that a Fed rate hike could cause the reverse. New car and home sales will fall driving used-car prices and rents higher. Ironically raising rates could boost CPI.

We have harped for years that Easy Al uses every ruse or excuse (productivity miracle, bogus CPI etc.) that he can muster to rationalize his irrational desire to keep pumping money.

Let’s not forget all those ridiculous or tenuous adjustments to CPI that keep it unwarrantedly low. And to those that defend hedonic adjusting, we retort that to suggest that an individual or group can gauge emotions elicited by inanimate objects on millions of disparate people is the epitome of arrogance.

-END-

From your fans in the Peanut Gallery comes this ditty. Don’t know if you saw it or not. I think Ron Paul is the most level-headed man alive.

"Despite our serious failure to prevent the attacks, it's disturbing to see how politicized the whole investigation has become. Which political party receives the greatest blame is a high stakes election-year event, and distracts from the real lessons ignored by both sides. Everyone on the Commission assumes that 9/11 resulted from a lack of government action. No one in Washington has raised the question of whether our shortcomings, brought to light by 9/11, could have been a result of too much government." --Ron Paul

Could we then extrapolate that too much government (FED, PPT et al.) dickering with the free-market system could lead us to the equivalent of an financial 9/11???? I think Ron Paul speaks sooth. –END-

A heads-up from silver guru Dave Morgan:

Bill,

As we both know, it has been brutal the past several sessions in gold and especially in silver. I am enclosing my first Letter to the Editor for your Midas, to let your readers know, that not everyone is taking this lying down, some are willing to stand up and fight!

Secondly, our website Silver-Investor.com is now fully automated, meaning all subscribers are issued private passwords and users names, more importantly the system will provide them access if they forget their password. Our latest issue was posted today and we are now offering a one month subscription. This is for investors, that are merely interested in our stock picks and do not wish to subscribe to another service for a year.

The damage done in the markets will take some time to repair in my view, and I had some significant insights into the gold market this month preparing our readers for the possible "political attacks" going forward. The precious metals markets will overcome all adversity in our view, but the going will be tough at times.

The "Morgan" indicator is at a strong BUY NOW level, meaning our subscription rate has fallen off significantly, which in the past has been a very good leading indicator as a low risk entry point.

My best to you always,
David Morgan
http://www.silver-investor.com

Letters to the Editor:

Hi Dave.

I've met you a few times, at the Vancouver show. It's always fun.

Next week, my lawyer is filing gold antitrust litigation in New Orleans. We should be moved straight into discovery with Blanchard. We're a little leery of Blanchard settling quickly due to shareholder pressure.

Silver litigation will be filed in about a month. Over 40 lawyers and 2 retired federal court judges have expressed the opinion that it is a far easier case than gold and will never go to court. Too embarrassing.

Due to evidence uncovered in the silver investigation, the firm will be suing the NYMEX for various discretions. I'm the plaintiff in the three cases. I laugh and laugh and laugh some more.

***Name withheld for legal purposes.***

-END-

More on silver:

Hi Bill,

I too have not yet received delivery of my March COMEX silver.
Also, I phoned a precious metal refiner here in Canada today asking if I could buy 1,000 oz or 100 oz silver bars from them. The man said no way because silver supply is very dry. He had not seen silver for some time, and therefore not had it available in a while. He also said he was very surprised that silver prices over $7/oz had not brought silver out of the woodwork.

Looks like the COMEX is the silver supplier of last resort, or first resort…while supplies last.

Ron Lutka

Sargehendra notes:

3rd day of HUI tracking sideways at 180. Trap being set for next 14 point leg down. Tomorrow or Wednesday . . .

IF they don’t take this puppy down another 14 points then maybe this campaign is finally over. There is some covering in NEM this morning after shorting it from 50-47 down to this level. –END-

We are in a money game when it comes to the gold shares these days. Thus, operating performances don’t carry the weight the normally would. Yet, good news for Golden Star shareholders in that first quarter results were almost 100% better than expected (3.9 cents versus an anticipated 2 cent gain per share).

DENVER, May 3, 2004 (BUSINESS WIRE) -- Golden Star Resources Ltd. (GSS) (CA:GSC) is pleased to announce net income of $5.2 million or $0.039 per share on gold sales revenues of $19.3 million for the first quarter of 2004 marking our ninth consecutive quarter of profitable operations.

First Quarter 2004 Highlights

-- Net income of $5.2 million or $0.039 per share

-- Total revenues of $19.9 million

-- Gold sales of 47,202 ounces

-- Realized gold price of $408 per ounce

-- Cash operating cost of $181 per ounce

-- Good progress on developments projects

-- Wassa startup deferred to third quarter of 2004

-- Board approval for addition of a second processing plant on the Prestea concession

-END-

It is important to note here that most of the gold producers, such as Barrick and Newmont, have missed their expectation numbers this quarter.

The XAU closed up .19 to 82.13, while the HUI continued its slide, falling 1.02 to 177.76.

GATA BE IN IT TO WIN IT!

MIDAS

Appendix

Dear Bill,

Aaron Russo isn't the only Presidential candidate who backs sound money. Michael Badnarik of Austin wants to abolish the Federal Reserve and return to a Constitutionally-based money system. His stance on hard money can be seen at http://www.badnarik.org/issues/. Michael teaches a class on the Constitution, and for several years has required payment in silver only.

Thanks for listening. I appreciate all you do to expose manipulation of
the gold and silver markets.

Best Wishes,

Jennifer Barry
Discount Silver Club
Lewisville, TX

Bill

I am not an expert on precious metals by any means, but I'm no fool either. I see the deficit growing so out of control, the futility of gambling in the stock market, and the obvious difference between a conveniently renewable currency (fiat confetti) and metals that are difficult to obtain. I am not a speculator, I am a long-term investor, and my primary reason for buying so much physical metal is in wealth preservation. I think it's possible that we will reach a state of hyper-inflation, and the confetti won't be worth the paper it's printed on, so I tenaciously hold onto my metals, the only reasons I would part with them would be in case of extreme emergency or taking some profit when I feel it's reached that point (and even then I will hold a core that I will NOT part with). I'm confused about precisely how the shorts are bringing the price of silver down, so I'm going to venture a guess. Since there is a scarce amount of silver, I believe they are using derivatives, that they have a large amount of money to invest in lowering the price and that they are attempting to cover. It seems to me that if this is the case, an analogy would be trying to dig yourself out of a hole by making a deeper hole, and delaying the inevitable. I'm
just guessing here, in your opinion is this a good guess? I'm a loyal follower of your articles since I believe that your insight in this area is remarkable.

David Brandt

A vote for Kerry is a vote for the same old same old, especially when it comes to gold. Does one need to graduate from Yale to be qualified to run for President?

Hi Bill,

Looks like voting Kerry in and Bush out means nothing. Kerry’s economic advisory council apparently includes Robert Rubin, who was Treasury Secretary in the Clinton administration and a key figure in the gold price suppression scheme according to GATA researchers. Different president perhaps (if Kerry wins) but in my opinion the same suppressive people with evil intentions will be running the asylum. The suppressive people of planet earth need to be restrained by the decent human impulses of planet earth. There is no other choice unless we want ourselves and future generations of decent people to be continually suppressed and made ill. There are so few of these suppressive people, if one were to really look. The vast quantities of harm they cause make it look like the suppressive few are many in number, which is not the case. Let’s continue to exert pressure on restraining the suppressive few and open are arms to any decent human impulse that wants to join us.

Ron Lutka

bognair

Wo sind Deine Dreiecke Bognair?

Verschlüsselst Du gerade Deinen ganzen Computer mit dem neuen Programm?

GOLD steigt gerade, obwohl es doch fallen sollte, wie uns viele Analysten kürzlich noch versicherten.

Gruss

ThaiGuru

GOLD 390.- Dollar !!!!

Wir sind wieder drüber!

option63

Du hast völlig Recht, und bringst mich auf den Gedanken!

WARUM werden WIR Goldbugs eigentlich nicht bezahlt?

Gruss

ThaiGuru

option63

Einfach toll bis jetzt!

Dollar runter! Gold hoch!

Silber kommt langsam auch wieder auf Touren!!!