There is no way that the gold price will accomodate what most people believe and bounce again at 282. We're going to 274 --just to really shake out the weak money.

Thanks for the URL..........

To argue that financial markets in general, and international lending in particular, need to be regulated is likely to outrage the financial community; yet the evidence for just that is overwhelming, Mr Soros states. He believes the private sector is ill-suited to allocate international credit. Mr Soros has argued before against the view that free markets should be left to correct themselves without government intervention. But this is the first time he has proposed an international loan guarantee institution of this type. Mr Soros hopes Monday's decision by international banks to roll over some of their debts to South Korea marks a turning point.

It is worth while re-iterating a comment made a few weeks ago.......

In 1932 Stephen Leacock, a Canadian economist and humorist stated:

We have to have - I would not say stable prices; you can only have a world in which the price level moves

G'Day,

Happy New Year to you.

Paddy Hannan was an Irish prospector, who was the first White Man to discover gold mineralisation at Kalgoorlie ( latitude 30/47S, and longitude 121/29E ) in 1893.

Production during the period 1893-1987 was 1268 tonnes of gold, and since the development of the Super Pit in 1987 production is at an annual rate of 520 000 oz per annum, with a mine life in excess of 25 years on current reserves. Very large exploration upside.

Aye, Haggis

****JED****

During that time Menger's theoretical economics were seen as an

option, a choice, a possibility.

From modern perspective it can be seen that it was a choice

like humans have a choice to breath air or not.

aurator, are you sure - Yanks I can put up with, even at a push PSEUDO-South Africans, BUT Pommies. Now that I am a Scot/Aussie, I have a double bias. Remarkably, Kalgoorlie is a Pommie free zone, Old Paddy Hannan would turn in his grave.

I believe that it was an Englishman who, during the 18th centuary, one of the darkest periods in the history of gold, coined the phrase - GET GOLD: humanely if you can; but at all hazards get gold . Is this the motto of the current Bank of England? I hope that any Pommies plugging into Kitco don't work for the Bank of England, or MI6!

Thou of independent mind,

With soul resolv'd, with soul resign'd,

Prepar'd Power's proudest frown to brave,

Who wilt not be, nor have a slave,

Virtue alone who dost revere,

Thy own reproach alone dost fear:

Approach this shrine, and worship here.

For an Altar of Independence by Robert Burns:

aurator, are you sure - Yanks I can put up with, even at a push PSEUDO-South Africans, BUT Pommies. Now that I am a Scot/Aussie, I have a double bias. Remarkably, Kalgoorlie is a Pommie free zone, Old Paddy Hannan would turn in his grave.

I believe that it was an Englishman who, during the 18th centuary, one of the darkest periods in the history of gold, coined the phrase - GET GOLD: humanely if you can; but at all hazards get gold . Is this the motto of the current Bank of England? I hope that any Pommies plugging into Kitco don't work for the Bank of England, or MI6!

Thou of independent mind,

With soul resolv'd, with soul resign'd,

Prepar'd Power's proudest frown to brave,

Who wilt not be, nor have a slave,

Virtue alone who dost revere,

Thy own reproach alone dost fear:

Approach this shrine, and worship here.

For an Altar of Independence by Robert Burns:

No…………… I'm am not saying 1998 will be like 1997, but rather, things here at Kitco never seem to change. I have peeked in from time to time and still see the same endless acrimony. Yes, the rhetoric has toned down a bit, and the overt hostility has become more covert, but there is still way too much petty bickering hereabouts. This, my Croc reference was directed toward.

PS

Is it true Linda K. is divorced Hmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmm.

aurator, are you sure - Yanks I can put up with, even at a push PSEUDO-South Africans, BUT Pommies. Now that I am a Scot/Aussie, I have a double bias. Remarkably, Kalgoorlie is a Pommie free zone, Old Paddy Hannan would turn in his grave.

I believe that it was an Englishman who, during the 18th centuary, one of the darkest periods in the history of gold, coined the phrase - GET GOLD: humanely if you can; but at all hazards get gold . Is this the motto of the current Bank of England? I hope that any Pommies plugging into Kitco don't work for the Bank of England, or MI6!

Thou of independent mind,

With soul resolv'd, with soul resign'd,

Prepar'd Power's proudest frown to brave,

Who wilt not be, nor have a slave,

Virtue alone who dost revere,

Thy own reproach alone dost fear:

Approach this shrine, and worship here.

For an Altar of Independence by Robert Burns:

Many may feel the platinum had indeed withered. I've been looking for a year end sell off that still may occur in the first week of January. 1998 will be kind to all metals, but platinum particularly so. Count yourselves lucky who bought in the $340s, but anywhere under $400 will look very attractive when PL tops $500. Remember, the Russians could raise the price $100 with a couple well timed press releases. I've bought some platinum in the last two weeks, but I am still cautious. Who would have called for $342 platinum back in November? It dropped at least $40 lower than the market said it should. The speculative shorts in Japan had a field day slapping platinum around while the longs watched the Yen fall and banks and brokerages fail. The longs hesitated and the shorts took over. It's been my experience that you can pretty much count on at least one good rally per year, and one great blood bath. I think we've seen both this last month.

........Hawaii.....No Ka Oi!!!!!! Get it on Big Kahunna!! Yahooooooooooo!!!!! Let the Partyiiiiiing Beeeeeeeeeeeeegin!!!

you dudes and dudettes are cool.....and as I sit and ponder what you all look like ( I have a vivid IMAGINATION ) .....Colleen is still the BEST looking in my mind ( rain gardens and the soft fragrance of the roses pass my olfactories, mmmmmm... ) ......including you Ted ( talk about tieing porkchops ) .......and Aurator is a Bond lookalike ( still not holding a candle to Colleen ) ......Nick@C is probably WAY in the bag.........Mooney is too.......DJ and Panda are busy with their charts ( great charts ) .......StudioR is trying to figure himself out ( love you man ) ..........Donald is sniffing News ( with 6-pak in hand having No Mercy ) ....... Tolerant1...well.....gulp, gulp ( cheers ) .........MikeS ( the great one ) is still the master of the house ( but nothing w/o Pepi ) ..........Old Gold ( keep the faith George ) , he is picking someones bottom.....................Irvine is skating into some little cuty's 'backyard'........Spud is eating spuds...........Cherokee is wildly ( with the peace pipe, 'passa' la pìpe ) contemplating what will happen in ONE-MORE-DAY ( I bow great warrior...thwock! ssm ) ................Vronsky, planning wild abandon...........Strad with elegance.................Bart is taking a long awaited leave-of-absence from the nut-house..........Disney is wishing he could get back to the states for a good hot-dog or something........................crystall ball, well...bend over and say aaah!....... ( ouch ) ..............lgb ( BFD ) ..........Goldbug 23, you are the sh!t ( private joke and HNY down south ) ...............Savage ( one ) is trying to figure out this OJ thing ( the other OJ ) .....tgl ( who the hell are you!? ) ...............Sharefin busy cursing the keyboards ( wish ya luk mate ) ........sas is busy 'holding fort' in HK.........mind is wandering and bubbly starting to tease the 'perceptors'.............oh yeah, Eldo.......well, Eldo is doing what Eldo does ( right Bob Dole? ( SNL Joke ) ) ......it gets too hard to figure it all ( great bunch of people,now rambling ) .........gotta go bring cheer................HNY!!!!!

Life is goooooooooooooooooood...............¡Öh M¥! CHA-CHING$$!!$

AWAY...to the NEW YEAR!!!!!!!

Éßthankful

Does anybody remember the original Crocodile Dundee? There was a scene in which he and Linda Koslowski ( and what ever happened to her That was one beautiful woman… ) arrived at Mick's New York Hotel room. He looked at the television and said, TV aye, I saw this once years ago ( Supply your own endearing Aussie accent ) He turned on the TV as the credits for I Love Lucy rolled across the screen and Mick said, Yep……. That's what I saw. - and he tuned the TV off. Draw any conclusions you like. Anyway……………….. Happy 1998 to all……………

No doubt about it. If you people could'nt lie you would be out of business. Have a great 98.

How about some fun in the sun? And would you consider adding some sushi, sashimi, and shabu shabu to the menu? And don't forget the dark beer. Domo.

principal posters here, many of whom seem to be in the US, Australia

South Africa and diverse other places, could be an interesting

challenge. One might consider breaking the fest up by country, so that

those interested in attending would not have to travel too far.

But then, I reflect on the possibility that the regulars in far flung places might actually be keen on meeting one another [?!], so a single venue wouldn't be such a silly idea. Perhaps vronsky should put feelers out / organise a questionnaire amongst the potential participants.

Apart from the fact that a fest in London would give poor ( unless gold

hits $10000 ) me a chance to attend, Britain has a long history of gold

connected with all other countries, going back to the Roman currency and

before, and there ought to be an appropriate venue.

News of the incident- the attempted invasion [four French ships invaded the Welsh coast on 22nd February 1797] spread countrywide, causing a

loss of confidence in paper currency and a rush for gold... William Pitt the Younger slapped an Order of the Privy Council on the Bank instructing it no longer to pay its notes in gold... the rush for gold by the public immediately drove the guinea... out of circulation; but replacements were needed if trade and commerce were not to come to a grinding halt. The Bank quickly put 1 and 2 pound notes into circulation...

Digging deep into her vaults the Bank also produced foreign silver coins- they were initially mainly Spanish 8 Reales pieces... These coins were then countermarked with the head of the monarch, George III, and issued. The Spanish Dollars bore the head of Charles IV of Spain on whose neck the authenticating stamp was applied. It inspired one wag to write:

The Bank to make their Dollars pass

Stamp'd the head of a fool on the neck of an ass.

- The Bank of England

Another year is here!

Soros has spoken!

Suggest London for vronsky's gold 500 fest

I, for one, am ready to believe your resolution to be a credit to this forum. You have some real good input but the garbage does have to stop. Nobody is perfect and nobody knows for sure what the markets are going to do at any given time.

There are some who are far to hard on those who venture out with their best reasons or hopes for a market move. RJ will hardly post now ( and some others ) ; his loss to the forum is felt by the serious market watchers.

Russia lopped three 0's off their currency today. 1,000 rubles is now 1. In announcing the change a Russian official stated: As of today inflation is under control.

salaries by allowing their underlings to make bad loans all around the world. They are even back in Mexico in a big way. History will repeat. Many of these loans will blow up in their faces, leaving taxpayers to bail them out. They won't worry though. They'll just bail out with their golden parachutes.

Put in to this context, draw your own conclusions…

Do the names Kennedy, Rockefeller, Morgan, etc. ring a bell? Oh, I forgot, Rum, booze, finance.... Please Mr. Congressman/Senator, save capitalism from itself ( after I've screwed the poor buggers... )

You keep making promises of civility, and not adhering leaves you almost no credibility. I'm not here for the arguement, nor am I here to scroll past your constant tripe and insults. Goodbye.

Avalon - Election? Could be. I try not to reason why, I just try to make sure that I am headed the right direction, whichever way it is going.

As to your other question, India is by far the largest gold buyer, with about 25% of the total market that I include in my analysis. The US is second. Here is the breakdown ( country; tonnes; % )

Indian Rupees 713 25.6%

American Dollars 341 12.3%

Chinese Renmimbi 257 9.2%

Turkish Lira 219 7.9%

Saudi Arabian Riyal 203 7.3%

Taiwan Dollars 144 5.2%

Japanese Yen 136 4.9%

Indonesian Rupiah 127 4.6%

South Korean Won 127 4.6%

Italian Lira 87 3.1%

German Marks 82 2.9%

Thai Baht 60 2.2%

Brazilian Real 59 2.1%

French Francs 53 1.9%

Mexican New Pesos 41 1.5%

Hong Kong Dollars 40 1.4%

British Pounds 40 1.4%

Malaysian Ringgit 34 1.2%

Singapore Dollars 20 0.7%

You wrote:

That is precisely what the information standard delivers in the currency markets. On a minute-to-minute basis we know the exact value of any unit of currency. Its not fixed by government bureaucrats or held constant by the manipulations of central banks. The value of any currency is set by the global market, which, as I stated early, is a much more demanding standard than gold because the feedback mechanisms built into it a larger, more obvious and practically instanaeous.

Followed by:

It depends.... we are dealing with an extremely complex system where there are a lot of prevailing factors. There will be times when a stupid statement may account for nothing, at other times it may be significant.

My response:

But this just supports my argument. There is no information standard = you are using very loose interpretation of the word. The fact that we have instantaneous access to the exact value of any unit of currency does not set the value of this currency. It just helps the trader to take advantage of this knowledge to make money, to make a run on some country currency, etc. It does not help an average citizen in his daily life. If I receive my paycheck today and afternoon the prime minister makes a stupid statement which goes on net and trader devaluate my paycheck by 50% what am I to do? It also opens the door to manipulate the currency through putting out information which is suppose to change the valuation so that somebody can take advantage of it ( just like all PR spread through information media related to stock market ) . Hardly rigid standard

As you can see this information standard is failing when it comes to stock valuation. Take for example latest valuation of Oracle corp. Within days of Oracle announcing that they will not meet the revenue expectation their stock took a 50% dive. So what is the correct valuation of Oracle, the value before this announcement or value after the announcement. Oracle did not change anything on how they do business so so how this information standard relates to a vide swings in their valuation? I doubt that this is what we look for in monetary standard.

Than you wrote:

That's not been my experience at all. My experience has

been that technology coupled with the appropriate

business strategy, transforms the business.

My reply:

It transforms the efficiency how we do business but it does not change the underlying purpose of our business. Farmer still grows the food, retail delivers it to customer, and banking takes care of financial aspect of that transaction.

Same goes for warfare - a basic premise of warfare - to defeat your enemy did not change. Until we all step into virtual reality we I will pretend that I grow food and you will pretend that you ate it, and we decide to settle wars through a computerized war games, information technology helps us but does not replace what we do.

As far as you statement:

Information technology probably won't replace dna in

our lifetimes, I am not sure I would agree with that

statement for all time. Such technology has radically

changed human behavior and health.

I reply:

That’s what really scares me as well as most of the responsible scientists. We are pushing the envelope and forgetting about ethics and many time for immediate gratification we try to play God.

You wrote:

I too am amazed at the lack of understanding of IT at

senior levels of large organizations, and the desire not to

know coupled with a willingness to believe that all will

turn out for the best. IT then becomes a crutch for not

thinking about the business, because you are spending so

much time thinking about IT.

I reply:

Here we go, we can agree at something ;- )

Karlito, there is a lot where information technology can help, but there are things which are based on more than the fast access to information to take advantage of it and make money. Principles, morals, ethics, etc. are just few which come to my mind. To be honest, the fact that all these things are discussed on this forum ( not just how to make a few bugs fast ) is what is so addicting on this forum.

Go Kitco, go Gold, thanks Bart, and HAPPY NEW YEAR to all of you.

Silver: Still seems to be well contained within the steeply rising channel. Silver bugs shouldn't be worried unless the price breaks through the channel bottom. I doubt this will happen, but who knows.

Gold: Yes, gold failed to maintain the slope it had taken during the rally, and is now wandering ( IMHO for reasons expressed in my previous post. ) . No clear direction at the moment.

Platinum: Has broken out of the steep downward channel to the upside ( barely ) . Could be the start of a new rally, but I have a hard time believing this will happen, with the Yen still on the rocks, relative to the US$.

Palladium: Its recent strong rally seems to have run into a brick wall at the top of this channel.

All this said, I really don't trust anything that has happened in the last week, with many of the major markets closed and trading very thin. Personally, I exited most of my gold positions when Asian currencies weakened during the last rally ( yes, a little too early to catch the peak ) . I am waiting for a confirmed direction in the currencies before I jump back in. If currencies resume their downward trend, I want to avoid that inevitable 20-30% hit to my already damaged gold investment funds.

I plan to watch closely what happens Friday, and to be at my computer at least an hour before the market opens next Monday ( the first real industrial-strength trading day ) to catch up with the Asian action. Many of the metals are at extremes. One way or the other, there should be ample opportunities to make great gains early in the new year, but one must be fleet of foot.

HNY y'all.

The price of gold in US$ is still following the value of the average currency of gold buyer's, relative to the US$. IMHO, the reason the rallly failed and gold is heading lower is simply related to the fact that the rally in the currencies failed. The world gold currency now seems to be oscillating in a steep pennant pattern, and must break out either to the upside or downside within the next few days.

With the world gold currency where it is, the price of gold can still fall within quite a wide range, without causing the world gold price to fall outside its historical channel. Right now I would say the US$ price of gold is being drawn down by the currencies. The neutral price would be about $283. The lowest to be expected would be around $272. The highest a rally should go is to $300.

It is extremely important to watch the direction the currencies take early in the new year, as this should be an indicator as to where gold will go, or at least a confirmation ( or lack thereof ) of the direction gold is heading.

year and blowhard something or other of the year -

Thank you bugman and karlito - and happy new year to all - This

site has provided much good humour and good fellowship for the past

year. Everlasting thanks to Bart.

Oh sportsfans- I made a booboo with sons of gwalia shares outstanding -

should be 102.6 not 1133.0 ( a transposition error ) - please change

on your charts.

of mistakes to come?

Any way, Happy New Year ( or New York, if it applies? )

The Pledge of Allegiance to the Flag must be wrong.

ALL: A NEW YEAR’S GREETING FROM THE GOLD-EAGLE STAFF

Perhaps Shakespeare had all GOLDBUGS in mind when he wrote this inspiring thought:

There is a tide in the affairs of men,

Which, taken at the flood, leads on to fortune;

Omitted, all the voyage of their life

Is bound in shallows and in miseries.

On such a full sea are we now afloat;

And we must take the current when it serves,

Or lose forever our ventures.

........ William Shakespeare

I'm in high tech and I've seen intelligent people unknowingly follow some of the most absurd instructions you can imagine. Often with disastrous results.

And no, I don't tell people to play Russian Roulette either. Not even in jest. I know what terminal ballastics look like. However, I do enjoy the shooting sports very much. Perhaps I'm just geting old and cranky?

Nah.

BBL

Not to worry.....

Still in shell shock over the prices though. Just think, and I used to be upset at the price of gold falling! :- ) )

All - Best wishes for a healthy and prosperous new year.

The Wall Street Journal Interactive Edition --

December 30, 1997

Edit Page Features

Why Secrecy Is Bad for Banking

By MARTIN MAYER

For several months, the U.S. Treasury Department and

the International Monetary Fund have been calling on

Asian central banks to fess up about the condition of

the banks and finance companies they supervise and

to force the borrowers from those institutions to keep

their books according to the generally accepted

accounting principles required by the U.S. Securities

and Exchange Commission.

Meanwhile, at the request of the Federal Reserve and

other U.S. banking regulators, 14 members of the

House Banking Committee have introduced a Bank

Examination Report Protection Act, which would make

it all but impossible to find out what U.S. regulators

know about the banks they supervise. And Fed

Chairman Alan Greenspan has crusaded against a

proposed addition to the generally accepted accounting

principles, supported by the SEC, that would compel

U.S. banks to recognize in their published reports the

fair value of their holdings of derivatives.

Perilous State

Asian governments and central banks created the

current mess by concealing the perilous state of their

banks. For seven years, Japan has encouraged banks

to carry as good assets old mortgages on real estate

now worth perhaps a quarter of face value. Korean

multinationals, known as chaebol, have been

permitted to conceal their subsidiaries' losses by

shifting loans from one set of books to another. In

Thailand, banks were allowed to carry loans at par

until the borrowers hadn't paid interest on them for

more than a year.

These Asian governments and central banks were

midwives to a fearsome cadre of what the economist

Edward Kane calls zombie banks. Such walking dead

devour their own good assets every night, and thanks

to the magic of compound interest they become

exponentially more insolvent, like U.S.

savings-and-loans in the 1980s. But governments and

central banks vouched for the zombie banks, which

were able to keep borrowing dollars from banks in

other countries.

The dollar-denominated loans are devastating the

Asian markets. Debtors have to sell the local currency

to acquire dollars so they can pay their debts. As the

local currency declines in value, debtors ( and local

banks ) must find ever-increasing quantities of it to

service their debts. This can become a death spiral for

the local economy. If good information about what was

going on in these countries had been available, many

of these loans would not have been made. Honest

Asian businesses would not be ravaged by declining

exchange rates and rising interest rates, and the world

would not have to fear further collapse in Asia.

There is a systemic fault here, because the mixture of

bank loans and portfolio investments on which the

Asian countries have relied to fund their economic

development is inherently unstable. Banks accumulate

information and keep it for their own exclusive use.

They are not and never have been risk takers; they

made their living historically by their possession of

information not available to others, which they could

afford to gather because they spread the cost of

gathering it over a number of loans. Secrecy makes

sense for banks, especially in an environment where

an ever-increasing fraction of their earnings comes

from trading, and the habits of secrecy hang on.

Markets, by contrast, cannot survive without

transparency. Markets are an inherently less expensive

way to price and raise capital, in part because they

use generally available information. Banks

themselves, once funded from public deposits, now

rely on markets to provide most of their lendable

resources. Companies get access to capital markets

when they grow large enough that information about

them is widespread. In an age of information

technology, small companies become publicly traded

much sooner than they once did, and large companies

find banks superfluous. As Dennis Weatherstone

observed while he was chairman of J.P. Morgan, we

live in a time when capital markets dominate credit

markets.

But banks retain and secrete information that markets

need, not least information about the banks

themselves, their sources of profits, lending policies,

asset quality and location, and hedging activities. To

the extent that bankers confuse or mislead the

market, both the market and the banks will be

susceptible to severe disruption when an unexpected

truth comes to light.

The danger is greatest in loans from one bank to

another, especially across cultural and linguistic

boundaries. Banks themselves consider these

interbank loans to be very safe, because ordinarily no

government will permit its banks to go belly-up in

public. Regulators consider the interbank loans very

safe, because they believe the banks making such

huge unsecured loans will police each other, refusing

to lend to doubtful institutions. The Bank for

International Settlements in Basel, Switzerland, the

central bankers' central bank, gives interbank lending

among the banks of the developed world ( including

Korea ) a risk weighting only 20% of that assessed

against a loan to any nonbank enterprise. But

interbank loans are not only unsafe ( which means that

banks will pull these lines fast from any borrower that

seems to be getting in trouble ) ; they are also a

transmission belt for anxiety and for loss of faith in

the financial system.

Banking regulators hate to abdicate their power as

sole evaluator of banks' assets because it is the real

source of their authority--and gives them, they

believe, opportunities to use denial as a weapon

against panic. As the Japanese Ministry of Finance can

attest, however, government assertions that

everything is really all right carry little weight today.

Market discipline already exists. The market will value

the bank--as an investment, as a place to keep

deposits, as a borrower--according to the information

on the street, which may or may not be more accurate

than what the banking regulators put out.

Transparency builds confidence; secrecy creates fear.

Ultimately, the way to maintain safety and soundness

in banks is to reduce what they used to call window

dressing and give the investing, depositing and

borrowing public much more of the inside information

management uses to run the bank. William Isaac,

retiring as chairman of the Federal Deposit Insurance

Corp. in 1984, urged Congress to legislate publication

of the front, factual section of bank examiners'

reports. Eleven years later, the Shadow Regulatory

Committee of academics who study the Fed urged

publication of the entire reports. New Zealand has

already established such a regulatory regime, and

something like it was clearly in the mind of Britain's

Chancellor of the Exchequer Gordon Brown a few

months ago when he took banking supervision away

from the Bank of England and turned it over to the

new disclosure-oriented Securities and Investments

Board.

Eventually, disclosure and market discipline will

replace banking regulators in the U.S., too, but right

now the wrong lessons are being learned. Old-timers

in Japan, Korea and the U.S. believe that if only the

secrets could have been kept, the banks and their

supervisors would have found some way to avoid the

mess. Thus the new bill to protect all examination

reports from all interrogators, and the Fed's opposition

to more revealing accounting standards.

In 1983, prodded by the SEC and the late Sen. John

Heinz ( R., Pa. ) , banking regulators reluctantly ordered

the big international banks to reveal country by

country their major foreign loan exposures. The

equivalent today would be a requirement that banks

post in some public place--the Internet would do

fine--a detailed list of their daily interbank exposures.

No Presumption of Safety

There are limits to what such a rule could accomplish.

Derivatives traders could easily invent a legal

instrument that would permit banks to lend to other

banks without appearing to do so. But such

instruments would have to be priced on a daily basis,

and would not carry the presumption of safety the

governments now give the interbank market.

The genius of capitalism is that markets, not

regulations or politics, force the admission and

correction of mistakes. For a global economy to work

properly, investors and their advisers must be able to

beam their searchlights far deeper into the recesses of

the financial institutions than their regulators now

allow. No doubt the interbank market would shrink in

the glare--perhaps all the way down to its historic

function of facilitating trade and payments. But some

loss of financial articulation and efficiency would be a

small price to pay to reduce systemic invitation to the

chaos we see today.

Mr. Mayer is a guest scholar at the Brookings

Institution and author of The Bankers: The Next

Generation ( Dutton, 1997 ) .

lgb - Your huevos posting was offensive. I think you owe

vronsky an apology - where are all those Gentlemanly types that

scream for respect - respect when others take exception to the useless garbage you post . Are you all the same person

you are one sick puppy.

To use it, drop the target file into the directory where you have binhex located. To use binhex, just double click on it from file manager or windows explorer. It will open to a window allowing you to navigate to the file you want to decompress. You click on the file, and it is done, almost instantly. The decoded file will be located in the same directory.

You can't eat information.

You can't run a hydrogen fuel cell on information.

You can't wash clothes in information.

You can't build a house out of information.

You can't fill-up a gasoline tank on a car with information.

Until nanotechnology makes matter free, we material people are going

to need matter, i.e. gold, platinum, corn, wheat, washing machines, etc. Go out and make your own inflation index of the top 30 to 40 things you buy EACH WEEK. OPEN YOUR EYES. STOP BELIEVING WHAT WE ARE TOLD, AND GET THE REALITY OF FACTS FOR YOURSELF & COMPARE.

I did. Inflation in these necessary weekly consumables is running 11% in North Texas, USA. We are being slowly boiled alive, while being told by Wall Street types in four-piece Italian suits how great it is.

Don't be a ) dazzled or b ) deceived by the likes of LGB/Karlito/EB - these guys ( ? ) make their living off the scraps of the manipulators of public opinion. It's meta-crime.

Speaking of which, did anyone watch the USA Public Television program last night on The Stock Market? My God! Talk about true believers! Putting their life savings in the markets, dreaming of dream houses, children's colledge fees ... with no conception that they could be wiped out. Hong Kong markets run by twenty-year-olds with no real experience of market crashes ( well, I supose they do now! ) ... I could only shake my head sadly and ponder their ultimate fate, while Wall Street brokers grin with flatulent sincerity on the way to the bank with these people's money...

THANKS FOR ALL THIS. YOU ARE THE KING OF KITCO...FOREVER!!!

HAVE A HAPPY AND PROSPEROUS NEW YEAR.

**********~~~~~~~~~~~~~~~$$$$$$$$$$$$$$$$$***$$$$$$$$$$$$$~~~~~~~~~~~*********

For High Rise

Tell me about it - US sanctions against South Africa along with

the UK and US press campaign against RSA were instrumental in installing my great leader in power. I hear he has charm, wit, wisdom,

humanity, etc and I await his possible bodily ascension to higher

places. Winnie has been described as a saint and mother of a

nation. I keep looking for these qualities to surface but has never

seen any sign of them - except maybe on the rugby field for a moment.

Gee - I cant believe you're dissapointed in the leadership of my

adopted land.

Frankly, I'll be VERY glad to see Mandela go - his heart has NEVER been

with the west. It's with the old time African leaders and the past-over

reds like Ghadaffi and Castro.

However China will be a big market for the g5/g6 155 groundpounder - as

will as the rsa attack helicopter systems. Cheap and good.

all other kitcoites and LGB too.....Happy and Prosperous New Year! I would like to thank everyone on this sight who has contributed info. I had a HELL-O-YEAR and much of my duckies came because I read kitco.

Special thanks to Irvine-Boy ( RJ ) . I made a 'killing' because of you. You opened my clouded eyes to the PM's. I still owe you one.....but I'll keep the Lexus...actually I'm gonna buy a Chevy instead ;- ) .

Colleen - HNY to you as well. Thanks for the kind thoughts. Keep visiting and posting in '98.

MikeS - you da man!! Bryant Park is waiting...

sas - I like your math.....I came up with similar figures. I tend to give people the benefit of the doubt ( the nature of my particularly nice and sometimes ugly beast ) . Speaking of Beasts....how are things in the Kong as in Hong...

CB - you can have him now. I'm done.

D.A. - who will get that winky-dink? The battle will resume in '98. HNY! Tick-Tock, Tick-Tock....the gold-bug fell off the clock....klunk.

ALL - on the subject of Eyeglasses ( thanks Panda ) . Do not forget to use up your 'flex-plan' dollars for glasses or other medical stuff. Use it or lose it!!!!!

away...to the grind

Éßblowingthehorntonight

to all - gold is going UP in terms of silver - ratio is 48.5 off a

low of about 46.5.

I hope that LGB can comprehend it - I really do.

If I keep a green bough in my heart, the singing bird will come. -[Chinese Proverb]

Bart, vronsky, JTF, sharefin, Mike, Tolerant1, SDRer, Donald, Dear Aurator, Nick@C, EB, JohnD [how's your dreadful Cape weather?!] cherokee, Allen, Schippi, 6pak, Fred, Auric, panda, Earl, LGB, Steve,Haggis, Ted, Another, Chrys.Ball,and All Kitcoites I am only now getting to know-

You have shared so much of your time, knowledge and expertise with me and all others who care to participate in the last months. I have learnt so much from you all, and I thank you.

May you all get the best out of 1998- Best wishes.

WEDNESDAY DECEMBER 31 1997

The international financial system is suffering a systemic breakdown, but we are

unwilling to acknowledge it. The abandonment of fixed exchange rate regimes

in south-east Asia touched off an unravelling process that has exceeded

everyone's worst fears, including my own. So far the large bail-out programmes

implemented by the International Monetary Fund have not worked.

Lending by the international financial institutions can never replace lending by

the private sector. The rescue packages are supposed to do their work by

re-establishing private sector confidence. Unfortunately, the currencies of the

debtor countries have continued to depreciate, aggravating their debt problems

and further undermining confidence.

The countries concerned were over-indebted to start with. The decline in their

currencies, coupled with the drastic rise in interest rates, has rendered the debt

burden even more crushing.

We are dealing with a self-reinforcing process. Once it is reversed, it could

become self-reinforcing in the opposite direction. The trouble is that the process

is still moving away from equilibrium. It is impossible to tell how far it may go.

What started out as a minor imbalance has become a much bigger one that

threatens to engulf not only international credit but also international trade. We

are on the verge of worldwide deflation.

The IMF has been criticised for applying the wrong remedy. The FT's columnist

Martin Wolf has pointed out that the deflationary effect of the debt burden is

reinforced by the deflationary effect of the IMF programmes.

Jeffrey Sachs, director of the Harvard Institute for International Development,

has carried the criticism further by blaming the IMF for insisting on punitively

high interest rates. But high interest rates are essential to prevent the currency

from going into a free fall. They have served to protect the exchange rate in

countries as diverse as Hong Kong and Russia. It is difficult to see how high

interest rates could be avoided, given the constraints under which the IMF

operates.

The problems run much deeper. But we are unwilling to face them. The

prevailing system of international lending is fundamentally flawed yet the IMF

regards it as its mission to preserve the system. This does not imply I am not a

great believer in the IMF. Without it, and without other official creditors, the

system would already have collapsed in 1982 and again in 1994-95. With luck,

we may pull through once again. But it is high time to recognise the defects of

the system and reconsider the mission of the fund.

The private sector is ill-suited to allocate international credit. It provides either

too little or too much. It does not have the information with which to form a

balanced judgement. Moreover, it is not concerned with maintaining

macro-economic balance in the borrowing countries. Its goals are to maximise

profit and minimise risk. This makes it move in a herd-like fashion in both

directions.

The excess always begins with overexpansion, and the correction is always

associated with pain. But with the intervention of the IMF and other official

lenders, the pain is felt more by the borrowers than by the creditors. That is why

overexpansion has recurred so soon after each crisis. Successive crises have,

however, become more difficult to handle.

In 1982, banks lending to Latin America were involved for their own account.

The crisis was contained by persuading them to act collectively and to extend

fresh credit to allow the debtors to service their debt. The banks did get hurt in

the process although not as much as the borrowers. Latin America lost a

decade of growth. The banks learned to minimise their own exposure and to act

as underwriters and wholesalers instead.

In the 1994-95 crisis, it was the holders of Mexican treasury bills that had to be

bailed out, mainly by the US Treasury. By 1997 some of the banks had

forgotten their painful experiences and became engaged on their own account,

particularly with South Korean companies.

The Korean crisis, as distinct from that in other south-east Asian countries,

bears some similarities to Brazil in 1982 - with one major difference: the loans

are not to Korea as a sovereign country but to individual companies. This has

made it more difficult to get the banks to act collectively.

Since we are in the middle of a crisis it is impossible to predict how it will play

itself out. There are other shoes that may yet drop, notably China. On the other

hand, Japan, which looks so bad at present, has the wherewithal to solve its

problems.

It is not too soon to start thinking how the system could be improved. Fresh

ideas on the subject could even have a beneficial effect on how the current

crisis is handled. But that would require questioning some of the most cherished

tenets of the business community. To argue that financial markets in general,

and international lending in particular, need to be regulated is likely to outrage

the financial community. Yet the evidence for just that is overwhelming.

Given the uneven distribution of savings and investment opportunities, there is a

crying need for international capital movements. But the private sector is

notoriously inefficient in the international allocation of credit. It follows that

international capital movements need to be supervised and the allocation of

credit regulated by an international authority.

This goes against the grain of prevailing wisdom. How can bureaucrats know

better than those who take risks for their own account? The answer is that the

technocrats running the proposed international authority would be charged with

maintaining macroeconomic balance, while the technocrats in charge of banks

are guided by profit considerations. Banks earn fees as well as a return on

capital and in the end they can count on the support of the official lenders,

because IMF and central bank intervention - like that in Korea - tends to favour

creditors. It would be better for the official lenders to control the risks they are

taking more directly.

I propose setting up an International Credit Insurance Corporation as a sister

institution to the IMF. This new authority would guarantee international loans for

a modest fee. The borrowing countries would be obliged to provide data on all

borrowings, public or private, insured or not. This would enable the authority to

set a ceiling on the amounts it is willing to insure. Up to those amounts the

countries concerned would be able to access international capital markets at

prime rates. Beyond these, the creditors would have to beware.

The authority would base its judgement not only on the amount of credit

outstanding, but also on the macroeconomic conditions in the countries

concerned. This would render any excessive credit expansion unlikely. The

capital of the proposed institution would consist of Special Drawing Rights. This

would render its guarantees watertight. The SDRs would not be inflationary

because they would be used only in case of default; at that time they would

replace money that had been lost.

There are many issues to be resolved. The most important is the link between

the borrowing countries and the borrowers within those countries. Special care

must be taken not to give governments discretionary power over the allocation

of credit because that could foster corrupt dictatorships. But once the need for

such an institution is recognised, the details could be worked out.

The institution can be set up only at a time when international lending is in a

state of collapse. We are now entering such a period. We can probably navigate

through it without setting up a new international authority of the sort I am

proposing. But we would be missing a great opportunity.

Moreover, the extent of the crisis could be mitigated by the prospect of an early

revival of international lending on a sounder footing. If the world is indeed

entering a deflationary period, an International Credit Insurance Corporation

could play an important role in containing its negative effects.

Happy 1998 to all goldbugs! Get Radical in '98, their con-game will end!

I recognize your dismissal of astrology, because I remember how I myself thought about it long before I ever became involved with it, before I actually learned what it IS. Though it sometimes amazes me how easy it is for someone as intelligent as yourself to disparage and dismiss something that they know absolutely nothing about. But I have no need to defend anything I do. Your opinions about these things are unimportant ultimately. What I do feel is important is that people who have earned the right to their opinions through paying their dues to their country by being forced into unspeakable horrors be allowed that right. That their motives not be judged. That you be, if possible, just a little more understanding, a little more ( you should pardon the expression ) tolerant. Those who have had the blessing of more civilized service to their fellow man and have not been called into someone else's nightmare description of service should count their blessings, continue their good works, and thank their God every day that they have, in this life at least, been spared their service in hell. You have a nice day now, sir.

Although I don't always like what I see, I do prefer to keep my sight....

You, my friend, are a wonder

for Miro

I agree with what you said to Karlito. I agree with

anything that is in disagreement with Karlito.

for KO

There are a lot of ways to look at a lot of things.

However, the tools you suggest would not help ME

decide which is the best investmnet.

for EB

You are as rude as I am - I dont know if I like that

or not.

for tolerant1

my time frame is infinite - JLHooker, Sam Barber,

Tom Rush, the Band, Brel, Lamenta della Ninfa, Steely

Dan ...

You write :

I think information has replaced gold. All countries with a floating currency must operate by the information standard which is much more rigorous than the gold standard, just witness the problems of S. Korea et.al.

The internet is the heart of the information standard. Several hundred thousand traders all looking at their screens, 24 hours a day, 7 days a week. When the PM of Poo Dunc makes a stupid statement, down goes his currency. When domestic companies over borrow or national governments do the same, there is a run on their currency.

Karlito, you are a management consultant with one of the Big Six so I assume that you know something about information theory and management and should know that the claim you are making is not true at all.

First what information standard are you talking about? Standard which is rigorous?!

I am in Information Management field for some 30 years and never heard about information standard replacing or even just rigorously supporting currency valuation.

Yes, we have ten thousand standards supporting information processing, they come and go with changing technologies, many of them contradicting each other, many of them ignored by IT practitioners and functional users. Well, I guess this sits just fine with floating currencies - we can float them whichever way we need.

Look at the definition of standard:

An acknowledged measure of comparison for quantitative and qualitative value; criterion; norm; An object that under specified conditions defines , represents, or records the magnitude of a unit.

Now, would you please elaborate how this rigorous information standard with internet being its heart works for monetary units? Is a stupid statement of prime minister worth $1US? $1.50US, $2.50DM? How much is worth overprinting of money by treasury department? Over borrowing? How do you value ( or adjust ) quality and correctness of information? Etc.. etc..

No my friend we don’t have information standard. Yes, we have a technology and infrastructure which can deliver and process the information much faster but that does not constitute a monetary standard!

In my many years in this industry is worked in many sectors of our society which heavily depends on information technology ( defense, intelligence, finance, government, private business, genetic research, etc. ) Most of them recognize that information theory and technology is essential to their business, supports their technological process, however, none of them would claim that information replaces their main functional process.

E.g., a few years back I was involved with Human Genome project, had a privilege to meet some top scientists in genetic research. There is no doubt that without information technology we would not be able to make a progress we did. However, information technology and standards will not replace DNA and nor will it determine human behavior or health. ( though there are ill attempts to use it that way by business entities - e.g. insurance companies )

Being in information engineering field for so many years it disappoints me so much when I see casting information theory into the new panacea role where information age, information superhighway, etc. is suppose to replace most of the existing values. It’s done without any understanding what information technology is about, and many times it does more damage than good. Unfortunately, the most abuses of IT role I see in business area where we waste money with claims that IT will take care of all our problems without having a clear understanding what is it we are trying to achieve.

As you see I am not making a claim and because of this gold will rise to $8000 level but I will argue with you forever about information standard replacing any other monetary standards. We have a long way to go!!

away...to tape the bone-crushers

ÉßwinkismineDA

plat is a screaming good buy though.....screaming......maybe ;- ) .

away...to bask in the warmth of a quick shot-o-the-smooth

ÉßlueAgave

Why do these people hide?

....eh, boob? I guess they don't want us poor slob goldbugs to come to their silicone valley apartment...er ...house to steal all their massive ( Hunt-like ) Silver stockpiles....yeah right...... ( spew ) ... ( splash ) .... ( burp ) ....... ( gag ) ........... ( ugh ) .

away...to live an open book

ÉßprivateI

what say you ROR huh!? Well?!? You socialist-union-man-lawyer-dude....ohmy.

now how is that for salty, salty? g'day mate...new year...etc.

I know MANY people who purchased S&P puts and made a buttload of duckets ( you don't hold options until expiry...moron ) ....so you can keep spouting that 'worthless' CRAP if you want. You just keep looking uglier and UGlier and UGLIER! PUHLEASE!...you don't know sh!t about puts and calls.........

the face only a mother could love ( or a dog could love it if you tied a porkchop to it ) ....ugh.

away...to read more 'worthless' CRAP...

Éß

I use inference find for searches - I did a quick

search for WD and came up with about 40 items - Yahoo

is not good for that sort of thing - or try alta vista.

Prime produced a bit over 12 mill oz of silver in 1996

- they are listed at 474,000 oz of production of gold

equivalent. Using 75 to one au/ag for the period for

example, would put their gold production around 314,000

oz. With a ratio of 47 to 1, their gold equiv production

would rise to 314 plus 12000/47= 569 gold equiv ( unless I

made a mistake ) .

Prime is the only example I can think of with

major ag production. They also have big copper reserves

in their share if the troilus mine.

I'm personally not very interested in the stock, but

suggest you can revise your own spread sheet any

way that suits you - you may or may not wish to share

the methodology with others - up to you.

nuff said.

away...to sell my precious st. godimanasshole'ns to buy some overpriced silver ( cause i can buy it for 34% cheaper... ( more crap ) ) and watch it tank.

Éßuptohisearsinhorseshit

and thank you so much for the HOT tip on gold going UP in early 98 ( duh,are you some kind of genius ) . I will start my massive accumulation when you give me the word.......horses-ass.

All - Currency of the average gold buyer has been fluxuating wildly lately. Could be a sign it is bottoming out ( though at the moment it looks like it is still trending down ) . If it is indeed bottoming, in my opinion, gold will finally start basing out, in preparation for the coming bull. Perhaps will have to wait for the new year to realistically judge the trend in currencies.

ill try to comply. The Mining Journal handles silver

in terms of gold equivalent by dividing silver

produced and in reserve by the au/ag ratio over the

period so the math is OK. Cost is expressed as $/oz

gold equivalent. It's a pretty standard calculation.

If you have a better way please advise with an

example or simply change you spread sheet to fit your

own interests.

For Bugman - Thank you dearie for nominating me to

the Hall Of Fame - Like they say bad publicity is

better than no publicity at all -

However I find your continuous and venomous berating

of Puetz offensive. It is self rightous posturing - you

may be sufferring from a sense of inferiority ( perhaps

it is justified - perish the thought ) - I demand that

spock and tgl demand that you apologize to Puetz -

and quick smart too,

For You and James - please desist from sowing

dissent between Haggis and me - we are quite capable

of sowing our OWN dissent. Anyway a guy that likes

malt scotch cant be ALL bad.

Having just finished my '97 taxes, I must thank everyone from Kitco's

1996 postings for the help, education, and encouragement we shared during

1996. Almost everyone has been run off from those days, but hopefully

this message will get through to them. For without them, I would of never

opened my Lind Waldock account on Dec. 20, 1996. I have survived the

first year and the accound is now 4 times larger then when I started.

I was very lucky this year, but I was even luckier to find Kitco during

the early days.

In my first post, I stated the most valuable thing I could add was information

about golfing in the Valley of the Sun - Phoenix. My offer is still

open to anyone coming to Phoenix this winter: drop me a note.

Anyone still in contact with the original kitcoites, please relay this

note to them.

Flight JT8D this is Kitco tower g.c.a. Execute a missed approach and join the circuit.

Since all else has failed and we are hanging upon your words, Captain, prepare the text on your word processor. Massage to taste. Save it as a bald a.s.c.i.i. file with /no carriage returns or line feeds/. Load the a.s.c.i.i. file back into the word processor and copy it to your clip board. Summon up the Kitco Add a Comment Page and paste your text into the text window.

JT8D you are cleared to land on 31 write ( ! ) . Check gear down and locked.

Glad you always make a lot of money - I cant help myself- I just

feel compasion ( whatever that is ) for all of god's creatures - great

or small. Sorry it was misguided compasion in this instance.

To all sports fans - Im curious - do you all actually UNDERSTAND

that spread sheet or have you lost interest

I think we should add Ashanti and Buenaventura and scrub echo bay.

sons of gwalia doesnt look too thrilling either nor does tvx.

Anyone got any ideas.

Some of you may be following the fibonacci relationship in the Gold

Silver Ratio. 47 to one seems to be holding - we bounced up sharply

and are now at 48 on silver's sharp fall. I think this MAY be very

bullish for gold.

To Karlito - I feel remarks like ignoring the fact that

the mathematics are incorrect ( repeated in several postings ) to Vronsky

are lousy cheap shots - I think you owe us all an apology for general

snide-ness. Spock I know is very sensitive to this sort of thing as

is tgl ( whenever we are lucky enough to get a glimpse of this rare

bird ) - Also - just between us - did you really work at the Lido

To LGB - gee silver off badly - hope you werent hurt too much.