Beiträge von Schwabenpfeil

Treasury's Role in Illicit Iraq Oil Sales Cited
Senator Releases E-Mail From Parties Involved in Shipments Banned by U.N.

By Colum Lynch
Washington Post Staff Writer
Thursday, February 17, 2005; Page A14

UNITED NATIONS, Feb. 16 -- The Treasury Department provided assurances that the United States would not obstruct two companies' plans to import millions of barrels of oil from Iraq in March 2003 in violation of U.N. sanctions, according to an e-mail from one of the companies.

Diplomats and oil brokers have recently said that the United States had long turned a blind eye to illicit shipments of Iraqi oil by its allies Jordan and Turkey. The United States acknowledged this week that it had acquiesced in the trade to ensure that crucial allies would not suffer economic hardships.

But the e-mail, along with others released this week by Sen. Carl M. Levin (Mich.), the ranking Democrat on the Senate Governmental Affairs panel's Permanent Subcommittee on Investigations, provides evidence that the Bush administration directly abetted Jordan's efforts to build up its strategic reserves with smuggled Iraqi oil in the weeks before the United States invaded Iraq in March 2003.

The illicit oil exports took place outside the Iraq oil-for-food program, which the United Nations administered from 1996 to 2003. While allegations of corruption and mismanagement in that program are under investigation by five congressional committees, the Justice Department and a U.N.-appointed panel, the illicit oil exports outside the program have received less scrutiny. According to investigators, Iraq received more revenue from those exports than from the alleged oil-for-food kickbacks.

"The bulk of [Saddam Hussein's] illicit oil sale revenues actually came from the money he received from unregulated sales of Iraqi oil, entirely outside of the oil-for-food program, primarily to Turkey, Jordan and Syria," Levin said at a hearing Tuesday on the U.N. management of Iraqi oil revenue. "We and the rest of the world looked the other way from those sales even though they were prohibited by the U.N. sanctions regime."..

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If oil, why not surreptitious gold dealings by this very same Treasury?

From the highly regarded Jesse:

Here is my response to the pundits who claim that with growth in M3 declining since 2001the dollar will appreciate and gold will decline in value.

Basically, they're just flat out wrong. There isn't any decline in M3 growth, except some noticeable draining back of M3 into financial assets (stocks).

Interestingly, counter-intuitively, M3 exploded after the bubble burst in 2000-2001. What was the cause of this? I have several speculations on my web site.

http://jessel.100megsfree3.com/M3Custodials.png

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From the highly regarded King Report:

Fed data released after the close shows the monetary base took a huge hit – falling $12.742B for the week ended 2/16. Total reserves fell about $6B to $43.595B, but required reserves fell almost $6B. M3 unexpectedly fell $25B for the week ended 2/7…Foreign central banks bought $3.379B in US govt securities while selling $1.335B of federal agencies. Central bank net buying of $2.043B broke three consecutive weeks of central bank net selling. Of course central banks turned buyer; the dollar declined.

Once again, Easy Al asked Congress to curb FNM and FRE growth, stating, "Going forward, enabling these institutions to increase in size, we are placing the total financial system of the future at substantial risk." However Al equivocated, "The risk now is, as best I can judge, virtually negligible." No risk now, but going forward the whole financial system might be at substantial risk? Sounds like a conundrum.

So yesterday Al waxes prophetically on system risk when the day before he reverted to his Sgt. Schultz of The Fed routine. Bubbles? "I know nothing." Productivity? "I know nothing." Neutral interest rate? "I know nothing." Flattening yield curve? "I know nothing." Derivatives? "I want to know nothing – do not regulate."..

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More on the stunning PPI news:

U.S. Jan. Producer Prices Rise 0.3%; Core Jumps 0.8%

Feb. 18 (Bloomberg) -- U.S. wholesale prices rose 0.3 percent in January, led by higher costs for cigarettes, vehicles and business equipment, a government report showed. Excluding food and energy, prices rose the most in more than six years.

The increase in the measure of prices paid to factories, farmers and other producers followed a 0.3 percent drop in December, the Labor Department said today in Washington. The core rate, which excludes food and energy, surged 0.8 percent, the biggest rise since December 1998. Treasury securities fell.

Manufacturers and other producers, struggling with rising costs for energy and other raw materials, are attempting to raise prices to maintain profits. Rising demand and less competition from abroad may be allowing some of the price increases to stick. Federal Reserve Chairman Alan Greenspan this week said inflation and expectations remain ``well anchored.''

``There is an inflation risk, not an inflation problem,'' said Ken Mayland, chief economist at ClearView Economics LLC in Pepper Pike, Ohio. Mayland was the best economic forecaster for the year ended in June 2004, according to Bloomberg Magazine rankings. ``There are pressures in the supply chain and some of these are beginning to bubble up.''

Economists forecast a 0.3 percent gain in the January producer price index, based on the median of 74 estimates in a Bloomberg News survey. The core rate was forecast to increase 0.2 percent, matching the previous month's rise.

Core producer prices rose 2.7 percent in January from the same month a year ago, the biggest rise since November 1995…

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First Japan, now China:

China Industrial Output Rises 8.9%, Slowest in 3 Yrs

Feb. 18 (Bloomberg) -- China's industrial production rose in January at the slowest pace in three years, reflecting a government clampdown on investment by state-owned companies.

Output rose 8.9 percent from a year earlier after gaining 14.4 percent in December, according to Beijing-based Mainland Marketing Research Co. (China), which releases figures on behalf of the statistics bureau. The figures were adjusted to allow for the week-long Lunar New Year holiday falling in different months and the increase was the smallest since December 2001.

Production growth has slowed from about 19 percent since Premier Wen Jiabao in April clamped down on industrial expansion to help cool inflation and ease power shortages. Surging exports and consumer spending are taking up the slack in the economy, which grew at its fastest pace in eight years in 2004.

``There probably will be a bit further slowdown, led by fixed-asset investment, but nothing dramatic,'' said Rob Subbaraman, an economist at Lehman Brothers Japan Inc. in Tokyo. ``We would argue that it's a good thing -- growth is becoming more balanced.''

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From Richard Russell this evening:

"One of the curious phenomena that I monitor is the action of the S&P futures prior to the regular market opening. Day after day, almost like clockwork, the S&P futures are higher during the evening, prior to the opening of the next day's session. Why is this? How is this? And I wonder, is it Wall Street's manipulative way of providing an "up market" at the opening? Is it simply ever-bullish traders betting that the market will be higher each day. It really is a mystery, at least to this writer."

No mystery to this MIDAS writer. Just like selling gold after the Comex close is The Gold Cartel’s manipulative way of providing a "down market" in the Access Market for the opening of overseas gold trading.

US economic news:

09:51 Feb. Preliminary Univ. of Mich. reported 94.2 vs. consensus 95.5 -- Reuters
Prior reading was 95.5.
* * * * *

CARTEL CAPITULATION WATCH

The DOW pulled another Hail Mary rally later on in the day. From Sarge:

"Some entity bought 550,000 DIAs in one trade. They plopped down a measly $59,000,000 to purchase that 550,000 lot of DIAs. The market has been on a 45 degree incline since then."

It finished up 31 to 10,785. The DOG fell 3 to 2059.

How much trouble is Fannie Mae in?

(FNM, down $1.71 to $58.90 – one nasty chart)
http://new.stockwatch.com/swne…utilit_snapsh_result.aspx

The John Brimelow Report

An all-too familiar presence...

Friday, February 18, 2005

Indian ex-duty premiums: AM $5.91, PM $5.22, with world gold at $426.25 and $426.45. Adequate, and marginal, for legal imports. Intervention by the Reserve Bank of India forced the rupee down to an import-unhelpful 6-week low this afternoon.

Although TOCOM gold closed at the highest level so far this year amidst favorable comments, in fact liquidation continued. On volume equal to 19,311 Comex lots (+13%) open interest fell the equivalent of 2,261 Comex (to equal 104,278 NY contracts), while Mitsubishi’s data implies a reduction in the "General Public" long of 9 tonnes (2,894 Comex lots). The active contract closed up 8 yen, and world gold managed a 20c gain over the NY close. (Yesterday, NY traded 50,117 contracts; open interest was up 162 lots at 263,541.)

The unflinching selling which has appeared on every approach into the upper $420s was obvious again yesterday. ScotiaMocatta says of the Comex trading:

"Overseas selling pressured gold from an opening of 425.70/426.20 to the session low of 424.50/425.00 where funds appeared as buyers on the Comex. The metal then started to trade higher… There appeared to be good scale up selling in the market, however, the fund bidding absorbed most of it."

UBS was irritated into unusual candor:

"very good buying was seen on Comex at about $426.00 for the April contract…gold regained its early losses and good two way trade took place between $427 and 427.50 in the cash market with a large German bank a noted seller against fund buying." (JB emphasis)

Evidently this seller was present again today. This preserved American Bears from might otherwise have been a very awkward day indeed, considering the news flow – alarming PPI. Oil prices, Middle East – and the long weekend.

Looking at the world gold chart, the presence of this seller at this level is unusually clear since the beginning of the year. (And indeed, the same level provided a couple of weeks’ resistance in late October last year.) However, the Bears, despite very serious efforts, have not been able to leverage this back stop into an effective trend reversal. So the agenda seems to be waiting for this seller to finish - or give up.

JB

As noted by MIDAS yesterday, that large German bank was Deutsche Bank, so often cited in this column as the price-capping market manipulator over the years. Deutsche Bank was also cited as a defendant in Reg Howe’s lawsuit for a very good reason. They are a major player in The Gold Cartel.

Silver led the way again, continuing its drive towards $8. The silver open interest fell 2359 contracts to 97,298. This must be reflecting the covering of the Access Market shorts by The Gold Cartel. When their ploy to influence gold during the Greenspan testimony failed, they were forced to cover. Meanwhile they capped the gold price to make their task easier for them. As is, they took quite a bath with their ill-timed maneuver.

A couple of notes.

*Gold was down early evening in Access Market Monday thru Thursday after the obvious price-capping during the day. EVERY day.

*My information before I corrected it in last night’s MIDAS about the silver and copper option expiry was incorrect. It is on the 23rd.

*Minor disappointment: 562,746 ounces of silver showed up in the Comex warehouses.

*The COT numbers revealed a very modest shift. The Commercials reduced longs by only 7,237 contracts and increased shorts by only 6,058 contracts. Technically, this is a modestly bullish plus.

Those who wish to go along blindly and accept the pabulum fed to the public by Wall Street, the Bush Administration and the Fed are going to do so no matter what analysis comes forth from those on our planet and in the GATA camp. This is a given and will be the case until they are bopped over the head when the US stock and real estate markets go into the tank. Then, they will go nuts … when their hard-earned money has gone down the drain.

As a result of the deception by the Orwellians, many Americans have been lulled into a false sense of security. Consequently, many are also loaded up with debt and enjoying one heckuva party. However, when the stock market and real estate market go south and the economy slows further, as it is already doing, they will not be able to service their debt and that is when it is going to get ugly. Those who have not prepared for this coming tsunami will be blindsided financially just as those unsuspecting people were in Indonesia, Sri Lanka and Thailand.

One thing for sure the way I see it, we have a financial/economic tsunami coming our way in the US. Better to be prepared and be a day/week/month/ or year early than a day too late.

Back to the markets. Goldman Sachs and SocGen turned huge buyers early. Our floor sources believed both had orders from a substantial client. No matter, each time gold poked its head above $427, The Gold Cartel swatted the price down. Gold was not going to be allowed to move this week and discredit Maestro Greenspan.

The gold open interest rose 162 contracts to 263,541.

The bond vigilantes finally woke up too. The fall this week in the 30-year Treasury bond was no less than a rout:

March bonds closed today at 113 30/32, down another 27/32
http://futures.tradingcharts.com/chart/TR/35

Which brings us to the dollar, which was very volatile, yet still closed solidly on the downside for the week:

March dollar, up .04 for the day
http://futures.tradingcharts.com/chart/US/35

Which brings us back to the world’s number one inflation barometer, gold. With all of these inflationary signals, gold was capped all week by The Gold Cartel to foster the illusion inflation is under control. How farcical can it get? Easy when you have the Matrix crowd and Stepford Wives running the show. Truth and reality have been suspended by these folks.

Well, this leaky Gold Cartel dam is about to burst. You can only fool so many of the people and the world investment community for so long. The charts tell the true story this week. You would never know it by looking at the gold chart however:

April gold (a move above $431 and it is all she wrote)
http://futures.tradingcharts.com/chart/GD/45

Silver is more like it and this is taking into account the flagrant, bozo attack on this market by The Gold Cartel during quiet Access Market trading hours on Tuesday evening:

March silver (ready to streak again)
http://futures.tradingcharts.com/chart/SV/35

But, there is no inflation? Not so Mr. Greenspan, when reviewing the economic reports released this week. Nor when one looks at this CRB chart either:

April CRB (breaking out)
http://futures.tradingcharts.com/chart/RB/45

The spot CRB closed at 290.66, up .67 and just below 23-year highs. The move was led by rebounding crude oil, which finished the day at $49.01, up 71 cents per barrel. Sub-$40 oil is for the dreamers.

Yesterday the surprise was very high import prices. Today that inflationary bit of news was bolstered by yet another inflationary surprise:

US core producer prices log biggest jump in 6 yrs

WASHINGTON, Feb 18 (Reuters) - Sharp gains in the cost of cigarettes and autos helped push core U.S. producer prices up at their fastest rate in six years in January, while overall prices also edged higher, the Labor Department said on Friday.

The producer price index, which measures prices received by farms, factories and refineries, moved up 0.3 percent in the month, the department said. But the core index, which strips out volatile food and energy prices, shot up 0.8 percent, the biggest gain since December 1998….

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But wait, facts don’t matter in the Orwellian society. What counts to these heinous people is SPIN. Greenspin spoketh "inflation is under control." So that is the way it is, and to prove it is under control, look at the unresponsive price of gold to the inflation news as gold is a standard world barometer of inflation and mostly US inflation.

When taken in toto for the week, we had the most visible evidence of gold price-capping and market manipulation since GATA’s inception in early 1999. What a sick group of Orwellians we have orchestrating the financial markets and the minds of an unsuspecting American public.

From last night’s MIDAS:

"It was back and forth in choppy action all session long with gold capped by the cabal to make sure no inflation signals might crop up to embarrass Chairman Greenspan while he was assuring Congress, Wall Street and America all was under control."

From Wednesday’s MIDAS:

``The economy seems to have entered 2005 expanding at a reasonably good pace, with inflation and inflation expectations well anchored,'' the Fed chairman said in the text of testimony to the Senate Banking Committee.

To demonstrate to the investment world chairman Greenspan told the truth to the House and Senate Banking Committees one only needs to view the subdued action of the gold price – according to the Orwellians. It is one of The Gold Cartel’s principle motives for doing what it does so well and so consistently: deceive the American public and investors around the world about the true status of American financial market policy and what is going on in the real US economy.

February 18 – Gold $426.80 down 10 cents – Silver $7.39 up 6 cents

Gold Cartel Only Postponing The Inevitable/US Inflation Picking Up Steam

"...the control of credit also has become dangerously centralized ... The great monopoly in this country is the monopoly of big credits. So long as that exists, our old variety and freedom and individual energy of development are out of the question. A great industrial nation is controlled by its system of credit. Our system of credit is privately concentrated....This money trust, or, as it should be more properly called, this credit trust, of which Congress has begun an investigation, is no myth; it is no imaginary thing. It is not an ordinary trust like another. It doesn't do business every day. It does business only when there is occasion to do business. You can sometimes do something large when it isn't watching, but when it is watching, you can't do much. And I have seen men squeezed by it; I have seen men who, as they themselves expressed it, were put "out of business by Wall Street, because Wall Street found them inconvenient and didn't want their competition. "
Woodrow Wilson

GO GATA!

My thoughts are that with the U.S. trade deficit at record high levels and the price of oil continuing to be over $40 per barrel, the Dow Jones Industrial Average, the Nasdaq Composite and the Standard and Poor’s Index will have to decrease in their respective values reflecting a drop in most share prices. Public companies simply cannot be pushed in a positive direction when these two factors are at those levels. Stop and think about it, when energy expenses are high, costs for virtually all businesses increase and profits go down unless those costs are passed on to the consumer. In either case, investors loose.

Investors loose unless they own shares in companies involved in gold or silver mining or some facet of the energy industry.

I think that you will find our interview with Steve Taylor to be interesting as it covers these subjects.

In the three following segments we interviewed Adam Lass, the founder of the Wavestrength Group, and Ann Sosnowski, an analyst who works with him. We were introduced to Adam by Addison Wiggin who, along with Bill Bonner, runs The Daily Reckoning. Adam is a pretty mainstream guy who is involved with investments on a daily basis. It was interesting to hear his prospective on the conventional markets because it was far from mainstream.

Lastly, we spent some time talking with John Kaiser. As most of you know, John writes The Bottom Fishing Report – a popular newsletter dealing primarily with the resource industry. We discussed the reasons for the current low prices of stocks in the resource industry and why they could be at higher levels in the near future. John also briefly described a company that he feels his subscribers should take a close look at. Click on this segment and see if you don’t agree.

* * * * * * *

Alexander Korelin is the co-host of The Korelin Economics Report along with Paul Warren. This program is syndicated nationally and can also be listened to on the Internet by going to http://www.kereport.com and clicking on “recent programs”. Guests pay no fees to appear on the program and neither Mr. Korelin nor Mr. Warren own any stock in the companies discussed unless it is fully disclosed.

The Korelin Economics Report – Welcome to All the New Listeners on “Talkstar”

http://www.kereport.com

[Blockierte Grafik: http://www.lemetropolecafe.com/img2005/Midas/Midas0217A.jpg]

[Blockierte Grafik: http://www.lemetropolecafe.com/img2005/Midas/Midas0217B.jpg]

Al Korelin and Paul Warren

The Korelin Economics Report debuted last weekend on a new network, “Talkstar”. Started by veteran radio personality, Victor Ives, “Talkstar” is headquartered in Florida and in addition to its family of radio stations it also provides programming on “Sirius Radio”, which is beamed from a satellite in outer space. (Who’d have thought that radio programming would ever come from outer space?) This is a big step for Paul and I, and we are proud to be part of this growing family of programming.

We began our program by talking with Steve Taylor, a Seattle based analyst. We discussed the record $617 billion U.S. trade deficit and the effects it could have on the price of precious metals and the conventional stock market.

The subject of the continuing high oil prices was also discussed.

Shaka Jr. CONFIDENCE and all things FICKLE

I believe that if you could boil Alan Greenspan's overall Fed-Fiat agenda down to ONE item it would be "CONFIDENCE". That is what Al eats/sleeps and dreams about all day and night long.

I perceive that he's been having nightmares of some sort, since his fateful Frankfurt visit last November. Did someone show him how easily his "confidence equilibrium" could be upset? Time will tell I guess, beware the fluttering butterfly.

As reality shifts further and further from the fundamental fiscal facts of financial forthrightness, the fortuitous will find furtive fortunes foisted upon them from the four corners of the globe as the fickle foolish fall over each other to follow the golden faithful.

GO GR21
Buena Fe

What a nice change of pace from the gold shares today and maybe a very important one. While the general market was doing a dive-bomb, the gold shares CLOSED ON THEIR HIGHS for the session, a fairly rare event over the past year.

The XAU gained 1.49 to 96.44, while the HUI rose 3.21 to 210.96. After checking key 210 late, the HUI popped near the close to clear this hurdle again and made a new high recovery close. Next stop 220. Of special note is the gold shares closed on their highs even as the general market shares were closing on their lows.

Lovely looking HUI
http://bigcharts.marketwatch.c…&o_symb=hui&freq=1&time=8

Tomorrow is a shortened day on the Comex with a US holiday on Monday when the Comex will be closed.

Been some tough 12 months, yet the big picture could not be clearer. The handwriting is on the wall. Gold, silver and the shares remain THE historic investment opportunity of a lifetime.

GATA BE IN IT TO WIN IT!

MIDAS

More good news from this staunch GATA supporter:

Gold Resources Increase by 34% at Seabridge's Red Mountain Project
Thursday February 17, 11:03 am ET

New 43-101 Technical Report Confirms Potential for Further Expansion

TORONTO--(BUSINESS WIRE)--Feb. 17, 2005-- A new 43-101 Technical Report has been prepared by SRK Consulting ("SRK") of Toronto on Seabridge Gold's (TSX VENTURE:SEA - News; AMEX:SA - News) 100% owned Red Mountain project located in British Columbia, Canada. At a 1.0 gram per tonne ("gpt") cut-off, SRK estimates an additional inferred resource of 1,729,000 tonnes at a grade of 2.97 gpt gold (165,000 ounces) in close proximity to gold resources previously reported by the Company for the project. SRK concludes that there is excellent potential to further expand the gold resources at Red Mountain with additional exploration drilling. The SRK Technical Report can be viewed on SEDAR at http://www.seabridgegold.net/images/Red_Mtn_Tech_Report.pdf

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Seabridge closed at $3.06, up 3 cents.