Fred-

Hedging production is dynamic and complex and very fluid. Some contracts will be filled by delivery, while others will be bought back at lower prices for a cash profit. A skilled and lucky producer can make money for years - except in a static market - by hedging production. They are traders like everyone else.

Panda -

Whose post was cut off? Look's all there to me! ( sigh of relief )

Away…………….tohavenightmaresaboutlorenabobbiteeeeeeeeeehhhhhhh!!!

old - the world's oldest form of money

log - it does not grow on trees

dog - man's best friend

god - no comment

do go - and buy some

Did I miss any?

( sorry for such a lame post )

My guess is that they would continue mining for a while because the cost of shutting down mines is so high. I think that eventually they would realize that there is more profit in just selling the contracts.

Allow me to hold forth my own extraordinarily and completely humble opinion on DINES.

He's a schmoe.

Feel free to quote me on that.

I assume everyone has heard the standard mutual fund buy and hold arguement based on demographics which goes as follows: 1 ) the baby boomers are afraid of retiring poor, 2 ) they have no choice but to buy the stock market ( insert: why never gold!? ) , 3 ) the oldest boomers won't retire until 2010, 4 ) therefore back the truck up and buy stocks because we have at least a twenty year honeymoon in stock market returns.

This sales pitch has always bothered be for many reasons including the lack of regard for valuation and the assumption of fixed supply of investments.

The January edition of the Canadian MoneySaver included an even more interesting torpedo: The largest age group in Japan during the 1990 crash was 40- 44.

Moral: tales of everlasting honeymoons at the top of bull markets and and the death of any investment ( ie:gold? ) at the bottom of a bear simply reflect the mood the market is in, nothing more.

Fred -

Remember, the reason gold producers sell forward is to lock in prices. I have read figures that some producers are sold up to 80% five years forward. Doesn't matter what the price of gold is today, they already sold it at a much higher price. They will be diggin' the stuff for years to come. Those that did not lock in higher prices will fail if gold stays down here much longer ( I don't think it will ) . They deserve to fail. They will be absorbed by the larger, more successful producers who had the good sense to hedge their production. As Paul Harvey is wont to say, Now you know the REST of the story.

PS

Read diggin in the literal sense as opposed something real 60's like, I'm really digging' how much cash we're getting for all this here gold we're diggin.

The gold they long

( a dollar they short )

Go gold they say

( drop dollar exhort )

Thousands an ounce!

( pennies a buck )

Don't wait to pounce!

( the buck's outta luck )

Gold is cheap!

( the buck's overpriced )

And beautiful too!

( George needs a 'doo )

Back up the truck!

( dump all your cash )

Can't wait a moment!

( if it burns do it fast )

Didn't you see overseas!?

( they look pretty cheap )

It's coming here next!

( Giant Frog's gonna leap )

Gold is oppressed!

( the dollar is free )

They're keeping it down!

( and Elvis ate three )

They can't do it long!

( but they caaAAHHNN do it short )

I'm hanging on!

( for bugs that's a quart )

Where do I buy unreportable?

( to hide a loss? )

How do I hide in my plumbing?

( use mental floss )

We need change in perceptions!

( pocket change I perceive )

I bought five more Maples!

( his tree he did leave )

It's the CIA!

( and maybe your wife )

There's still time!

( place a call on a life )

The Fed's on the loose!

( chewed through the restraints )

There's no tomorrow!

( then no more complaints )

To gubament boyz;

Face it guys, gold has the attributes that you desire ( as in gold standard ) . Gold is not anyones liability, it constitutes payment in and of itself. Payment in gold concludes the transaction. PERIOD. There is a downside though. You won't be able to inflate the @#$$ out of your money and have it linked to gold. I know, I know, it's tough to be forced in to an honest payments system. Ain't life a bitch. And those transfer of payments known as taxes...

1 ) The dollar is in demand, we need to print more dollars to meet ( commodity? ) demand.

2 ) Foreign stocks and bonds crashing due to currency problems in home countries.

3 ) Foreign inability to inflate their own currencies because they bought in to dollar based instruments of one flavor or another. Thus they need dollars ( 1 ) .

4 ) Forced liquidations of assets to 'buy' dollars to pay off dollar denominated debts ( 1 ) .

5 ) Competing devaluations to aid export to the U.S. ( 1 ) .

6 ) Strong dollar ( for now ) will lead to export problems for the U.S.

Remember, interest is the risk premium paid for holding cash. Thus, cash is not risk free. Cash, fiat money, derives its' value from repayment and the interest paid on it, thus it is an obligation ( debt ) . It follows that the risk premium ( interest rate ) is based on the 'credit risk' of the derivative, ooops! I mean the credit worthyness of the issuer. No, wait, cash is payment... Ahhh! The hell with it! Just think of the dollar as another derivative.... I'm so confused! Maybe I should buy nuemismatics :- ) )

1. Reduction in supply due to mine closings and lack of exploration.

2. Increase in demand due to flight to safety: weak dollar, inflation, etc.

3. European Community Central Bank decision on gold holdings. I think that they will decide to hold more gold than people expect. The World Gold Council has some excellent reasons why they should. See http://www.gold.org Luckily there are no dashes in their site name. Can somebody fix the text editor? Bart?

4. Central Bank loaning. Eventually, the Central Banks are going to reach the limit on what they are willing to loan. Loaning is just as bad as selling.

5. The market being smart enough to see these changes coming soon. A dumb market means a longer wait. Look at silver; they had to start running out of the stuff before there was a rally.

I have read a lot of posts about conspiracies. I do not think it is a conspiracy for Central Banks to sell or loan out their gold. It is their decision. Why should they care if they knock the price down for a year or two? After the mining is reduced, their stockpiles will be even more valuable. They can afford to wait it out.

If the Central Banks can wait it out, so can the long term investor. Dollar cost averaging is the way to go. Do not try to get rich quick ( unless Hillary Clinton is giving you investment advice, wait, that was cattle, and it was really a pay off ) .

Also, I want to thank whoever it was who posted the Nightly Business Report interview with Mr. Dines. I had a friend who missed it on TV.

USD Dollar 279- 290-

IDR Rupiah 2410000- 2460000

MYR Ringgit 1281- 1212

PHP Peso 12240- 11950

KRW Won 503000- 468000

CB not selling

Mines closing

Bond higher

Yen stronger

Asia turmoil

Fed printing

Clinton exposing

Sadaam threating

Another predicting

Stars aligning

AND GOLD FALLING! WHY?

http://www.acsys.com/~hong/retrieval.html

The Asians, with their work ethic, and family- based education ethic will recover relatively quickly from this financial fiasco, though it may take several years. We can only hope that the Asian solution is a peaceful one. It will be interesting to see what will happen when it is our turn to have problems.

I would be interested in your comments!

Looks like tomorrow will be crunch time for POG. My Barrick held up reasonably well, but glad I sold 2/3 of it on Fri.

I don't go to downtown Washington DC much, except when business requires it, or when I go to see my daughter who lives in DC. Safety and crime in DC is overstated by the media. Yes, there is a significant crime problem, but mostly in the areas where any sane person would no go in the first place, especially at night. I am sure that you can identify such places in any metropolitan areas across the world.

No I don’t plan to retire in this area but again, this is mostly due to my hobbies - mountains and sailing, and they’ll probably take me away from here.

I lost my first message to you in cyberspace.

I did not say I Hate the US - please tell me where

I said that YOU SAID that !!

Now what I REALLY HATE is BULLSH!T and people

saying that I said things I did not say -

I dont want to live in the US because I like other

places better - Now ID RATHER live in the US than

in Saudi Arabia. Id rather live there than Lybia or

central Africa. But Id rather live in Peru, or

Mexico, or Chile, or Argentina, or Turkey, or Spain,

or Australia, or Canada, or England, or France, or

Italy, or Mexico, or New Zealand or ALMOST anywhere

really. But I dont HATE it. I just cannot think of

any good reason to want to live there.

Why do HATE people that dont want to live in the

US

I go beddybye now - please annoy someone else -

annoy zadeek - he can take it - ask him why he HATES

numbers so much. Seeyoulatah.

I go technicolor dreamland my favorite place

...

17. For carrying on an undertaking of great advantage; but nobody to know what it is.

...

36. For a wheel for perpetual motion. Capital, one million

...

For ANOTHER fans:

68. Another for the improvement of our breed in horses.

69. Another for a horse- insurance.

And now for some deja vu?

...During the whole of the month of May the stock continued to rise, and on the 28th it was quoted at five hundred and fifty. In four days after this it took a prodigious leap, rising suddenly from five hundred and fifty to eight hundred and ninety. It was now the general opinion that the stock could rise no higher, and many persons took that opportunity of selling out, with a view of realising their profits... So many sellers, and so few buyers, appeared in the Alley on the 3d of June, that the stock fell at once from eight hundred and ninety to six hundred and forty. The directors were alarmed, and gave their agents orders to buy. Their efforts succeeded. Towards evening, confidence was restored, and the stock advanced to seven hundred and fifty. It continued at this price, with some slight fluctuation, until the company closed their books on the 22d of June.

It would be needless and uninteresting to detail the various arts employed by the directors to keep up the price of stock. It will be sufficient to state that it finally rose to one thousand per cent. It was quoted at this price in the commencement of August. The bubble was then full- blown, and began to quiver and shake preparatory to its bursting.... During the whole of the month of August the stock fell, and on the 2d of September it was quoted at seven hundred only.... On the 12th of September... several conferences were held between the directors of the South Sea and the directors of the Bank. A report which was circulated, that the latter had agreed to circulate six millions of the South- Sea company's bonds, caused the stock to rise to six hundred and seventy; but in the afternoon, as soon as the report was known to be ground- less, the stock fell again to five hundred and eighty; the next day to five hundred and seventy, and so gradually to four hundred...

[on the 29th of September]...the South- Sea company... stock fell to one hundred and fifty, and gradually, after various fluctuations, to one hundred and thirty- five.

Unfortunately I do not have a gold price for the period around 1720; it would be interesting to see what happened to it after the South- Sea bubble collapse.

reveals a pathetic lack of wit & imaginination.

It is difficult to invest in a precious metal such as gold, given the behavior of those who do not want its price to rise. It is very much like living near a lake where the water level rises a little bit every year. Instead of making a house that floats, the clever owner builds a dam around the house, adding another protective layer each year to fend off the inevitable. The only problem is that that dam can fail catastophically. The gold markets are very similar - - years of nothing followed by sudden activity - - when the blind faith in our paper currencies suddenly falters - - and then no amount of dam building can stop the flood.

Im not upset - because I said there were 3 times as many

Blacks in rsa as nonBlacks and YOU said that the RSA

population was 75 % Black - you we AGREE you silly boy-

You see 100 % - 75 % = 25% and 75% /25% = 3 - yes 3 - you

got it !! YOu actually got something RIGHT - after months

of trying - hooray hooray .

And the Black population of the US is 12 % - not 22% - so

you blew that one -

Old buddy you just cant cope with numbers now can you You

are just a misspelling and wrongnumber machine. Gimme a break.

I go back to sleep now - but first a vodka

and a word to my friend Boris who never annoys me because

he is a nice guy - You have to get a licence for a gun but its

not a problem - I have a .38. Come on over for visit - we

shoot trees and beer cans.

looks like the bahamas found a home in D.A.....or vice- versa. D.A., what do you guys say? This copper thing.....oversold, no? Needs a bounce.....ohmy. pray tell this lowly trader.....I need a bone to sink my teeth into......yum, yum, good for the tum, tum...

away

Éßepickingupallpenniesheadsortails

......the cat, the cat...i see the cat...uh huh.

Ted - welcome back, winters nap? You got some great graphs and stuff to catch up on....git to it!

Go Freddie...Yu da' man!! You will be player of year in '98.....EB's prediction...right here, right now!!

.......Go Elway! 12½ pts......hmmmmmm...I may just catch the Southwest shuttle to Viva Löst Wåjeez and throw down some greenbacks... ( cause they don't take the A$, or ¥en ) ....uh huh. Or perhaps I 'll contact Studio's Wookie...er bookme......duh.

Another is English....and who cares anyway...right bb?

Now what of the markets.....it sure is a slow day today at comex.....it must be the flu or something....................hmmm.

Back to work......grind, grind, grind...

away...

Éß

go plat...tuesday will be good.

I dont think you gonna goto heaven preacher man cause

you too dumb.

Of course in 30 years I wont recognise RSA you silly

boy - But you wont recognise USA either - Its all about

TIME mistah preacher - we is all screwed in de long

run - didnt you know ? - this way I got 17 good

years away from the US - and who knows - if it

gets annoying here - guess what mr preacher - ill

leave - also old bean I had not planned on livin forever

and if you have I think you should shorten yo time

hoRIzen - I may be in Cyprus or back in australia but

not in the US where you and yo congregation will be TRAPPED!.

Now mr preacher you have been judged in My court

and found unfitting to wear yo collar. You is

unfrocked forthwith-

I dont think you gonna goto heaven preacher man cause

you too dumb.

Of course in 30 years I wont recognise RSA you silly

boy - But you wont recognise USA either - Its all about

TIME mistah preacher - we is all screwed in de long

run - didnt you know ? - this way I got 17 good

years away from the US - and who knows - if it

gets annoying here - guess what mr preacher - ill

leave - also old bean I had not planned on livin forever

and if you have I think you should shorten yo time

hoRIzen - I may be in Cyprus or back in australia but

not in the US where you and yo congregation will be TRAPPED!.

Now mr preacher you have been judged in My court

and found unfitting to wear yo collar. You is

unfrocked forthwith-

Since things are so quiet on Kitco today I would like to take this opportunity to thank the person who said this ( or close ) on Kitco several months back. 5 bucks for silver - you can't even buy a G__ D___ hamburger for 5 bucks!. That nutshelled the POS for me.

Thanks to the guy who worked for the commodity exchange and stated the commercials were always right and the speculator always wrong judging from his fifteen years on experience. As the commercials are now long gold and short silver the next few months should be most interesting.

Research Institute was on. Projections of the future.

Said a lot of positive things about gold. Said CB's have

to keep gold down or there will be a run from paper ( bad

for banks ) to gold. Seems to me I've heard that around

here. Says it's just a matter of time. ( boy am I tired of

waiting at this station ) Said this year will be horrible

for the markets, Asia the main problem. But new ways to

electricly power things cheaply are coming on line.

Cold Fusion and something called the Patterson battery.

Gold may not have to attach to oil we may not need oil!

At least the message is getting out there even though

it is in the wee hours. At least it seems to have aired

twice last week.

I wonder - - with gold trading at thousands of tons/day at the LBMA, is the gold market really that thin any longer?

I wonder what Wayne Angell says these days, now that he is no longer working for the Fed. If he really thinks suppressing the price of gold is an effective way of fending off inflation, weakness in the markets, or weakness in the dollar - - I wonder if we should even listen to what he says.

ANOTHER's post dated Ja. 17/98 at 20:45

I still think that this huge lending practice is the primary reason for the current weakness in the price of gold.

away...to wait in the rain

ÉßryantParkBound

John, I'll keep a light on for ya' ( smile ) ...

away...to enjoy the times

Éß

Bugs: copper is a buy, no? Historically speaking from now until Feb....ohmy, and just look at the charts.....I am going in to make it or break it.....do your homework.

You cant beat the Cape. I wish I could get off the

computer and enjoy it. We have a first class

infrastructure, good wine, cheap fruit, booze, etc,

cheap services and help, and excellent weather. Its

like California without LA and at half price.

for Savage - dont follow crowds - I like you attitude -

but with echo bay you may be following the crowd to

the poor house

Perhaps a better way of looking at this is to think about who will not sell their gold - - such as Germany, France, Japan, etc. I don't think the US will - - as long as AG is Fed Chairman.

I agree that a gold bug like you or I would not do such a thing - - but that is a different matter.

Perhaps some bottom fishing in SE Asia has begun - - I for one would at least wait until China devalues their currency.

According to FV, the main reason for the gold bear is small CB selling of gold, with speculators piling in when the trend was obvious. He believes that when the EURO officially goes on line, individual CB's in the ECU will no longer be able to buy or sell gold without permission. Since Germany and France will wind up controlling the majority of the gold that will back up the EURO, there is no reason for the smaller CB's to keep their gold. FV has also said that the mind set of many CB's has been to focus on the last 10- 15 year trend in gold, and not longer term. Hence the gold sales by the Netherlands and Belgium, since gold seems to be of no investment value. Fortunately the French and the Germans remember hard times when gold was necessary to stabilize their currencies, and are much less likely to join in on the selling spree. Also, longer term, FV claims he can show that gold offers a better return than real interest rates on bonds.

This reason why the smaller CB's have been selling gold with such apparent abandon - - pushing gold well below its equilibrium price - - makes alot of sense in this context. Why keep something that you think you don't need anymore, when you can make money short term earning interest on paper?

So - - the key question is I see it - - is just how much gold Belgium and the Netherlands still have - - or for that matter any other country that plans to join the ECU during this first cycle, other than Germany or France? If there is any gold left, it is almost certain that these countries will sell it before the EURO goes on line - - simply because that gold is no longer needed, since the German and French holdings will be used to back the EURO.

Opinions?

You asked a question

How do you evaluate the political risk in RSA from day to day ?

and then you told me what your brother said

My brother says a lot of SA are leaving just like they left SR now Z.

Lets cover your brother first - I think he is

wrong - but I dont really care what he thinks and I

dont know why You mention him to me - maybe its

because he is your brother and you love him - I think

that's sweet -

Now to your question - I think that the political

risk for anyone who would ask this kind of question

would be way too much for them to bear.

You see Mozel - you are talking to a man who LEFT

the USA in 1981 for good BECAUSE he assessed the

risk to his personal freedom as too great to have to

put up with. I would never go back there - one of

the reasons being the amazing amount of politically

correct claptrap that is indulged there - one

example being the sacred day that you are presently

celebrating. Dont get me wrong - Im not particularly

racist - just realistic. Blacks are okay - celebrating

victimhood isnt. Ive basically enjoyed as much

Steven spielberg as I can stand.

If you mean the coming revolution and bloodbath -

Get a grip man - That stuff you see on TV is to make you

feel better about living in the US - Dorkos have

been forecasting this kind of crap since sharpevile and

before. Blacks are in the minority in the Cape and

very pleasant on balance and provide very cheap labour.

( my live in colored maid costs 100$ a month - my Black

gardener is 40$ a week - yours is probably cheaper but I

just have to live with that ) .

Re: Silverbaron's question of who owns the silver that was leased out. I guess I was a bit confused with the question because that silver is gone, so nobody owns it. Now think I see the question - did the CB's own it in the first place before they pissed it away on the lease scam? My opinion is yes for two reasons. One, silver, like gold, was accumulated by CB's or their predecessors for hundreds of years, but because silver ceased being an official monetary metal long ago, there was no reason to publish ownership amounts. As you know, the CB's let you know what they want you to know. Even now, very few officially acknowledge gold loan amounts, and it's obvious that is big business. Two, only an institution whose ownership of a valuable commodity was left in the hands of some kid technocrat, who could care less about something he personally didn't own, would be so stupid as to engage in the loan scam. I find it hard to imagine a real owner getting duped by the shear idiocy of metal lending.

A follow- up question: Is this what happened to the 2 billion ounces of silver in the U.S. strategic reserve? If so, is the U. S. government ( read taxpayers ) going to get stiffed for it when the leases cannot be rolled over?

Ziva, Fred totum dixit!

Sorry - after posting, found that our weather forecasters had ( once again ) missed their predictions and had to deal with an overnite snowfall getting to work ( a major problem in the southern US, where it rarely snows and drivers don't know how to handle it ) .

Hopefully, these forecasters are the same ones predicting the impending collapse of silver and gold.

A very long time since my high school Latin days, but ( roughly translated )

Carpe argentum = Sieze ( the ) silver, I believe.

Carpe argentum.

When you see my post's you'll have some idea of my background. Aloha..

The unanimous 9- 0 decision of the U.S. Supreme Court against the Clinton Administration's petition - - to have the current litigation post- poned until President Clinton's present term expires - - sends a signal to future U.S. Presidential candidates: Have a clean slate prior to entering the Oval Office for we will not dismiss apparently valid claims. And, any serious future candidates for the U.S. Presidency should remember that the skeletons in their closets will not forget that suit can be brought against a sitting U.S. President.

Gold to well above a 1000 by the end of 1998, can you tell me more because Iam about to sell everything I own buy up and dig a foxhole ( WW3 ) . If it doesnt I might have to move in with you.

1. An English speaking South African lady has applied

for residence in the US on grounds of anti White

racial prejudice in RSA. She has claimed that she is

disadvantaged by race to be able to find employment

in RSA because of their affirmative action program.

If this case is upheld, all White, colored, Indian,

and Moslem South Africans who are active in the

economy here will move to California or equivalent,

leaving RSA with a one way ticket to the iron age -

Mandela and Mbeki will be the bus conductors ( unless

they revise their programs - which they will of course

do - any body who knows ANYTHING about Africa knows

that Africans like to SAY one thing for mass consumption

then DO another thing to keep things cozy and stay out

of serious trouble ) .

2. I noticed nobody reported that man hours lost

to strikes in RSA were down to less that one FIFTH

of what they were 2 years ago. Why hasnt the man with

the strange name reported that Is it because it is

GOOD news and he is only in charge of BAD news Gee

Whiz - is this a case of vested self interest

( whatever that means ) .

3. Other mines that may be in trouble in addition to

Echo Bay ( 735,000 oz Canada ) and Pegasus ( Ive lost

touch with Pegasus because it looked so bad I took it

off the spread sheet - I know the Aussie part is

stuffed - what about the rest of it ) -

Suggest take a look at

AMAX - 600,000 oz - USA

TVX - 400,000 OZ - Canada

Sons of Gwalia - 400,000 oz - Australia

Royal Oak 390,000 oz - Canada

Kinross - 420,000 oz - Canada

HOMESTAKE !!!! - 1,600 oz - USA ( Say it isnt so. )

Less bad

ERPM - 280,000 oz - RSA - RSA May GO

Libanon/Leeedorn - 480,000 oz - RSA Must GO

Lorraine ( avgold ) - 300,000 oz? - RSA MUST Go

I believe that the mines on the above list are

in MORE trouble than the remaining RSA mines ( with the

possible exception of the original DBN deep Shafts ) .

This will come as a big surprise to certain people.

You mean they taught you English? Lucky you. I had to take Russian instead, and after I landed in the US there was never time to take any formal English class - too much hassle at work. I had to pick up English just through reading and listening. Not enough and it sure shows : - (

Well, maybe when I retire, I would love to do that.