mozel ( @ANOTHER ) ID#153102:

The benefits are plain to see.

But, it is not clear that gold mines would lose value. Oil wells will not, so why should gold mines ?

Mr. Mozel,

The USA placed a special “windfall profits” tax on domestic oil during the last major rise in prices. I do think the oil stocks would have shown a greated value had this tax not been in place. Because gold will soon become a currency, mines will be taxed in a much greater way. Also, domestic mines will be asked to sell directly to the treasury at the

“preceived commodity value” value of gold, plus an opperating margin. As no private company will be allowed do your treasury job, “produce money”. Gold in the hands of the public will be thought of as a good thing, as citizens are asked to “pull own weight” as the government is much under.

Are you of this mind?

Neophyte ( Another - ECB gold holdings? ) ID#390249:

Do you know how much gold the ECB will hold as part of its reserves?

Mr. Neophyte,

I do not know. I have knowledge of some discussion for 15% with a individual country holding that is very high. If this is as a final outcome, many CBs will be forced to call in lent gold and buy. I have reason to find this to be as fact!

Date: Sat Mar 07 1998 20:02

BillD ( ANOTHER...PERHAPS an unimportant question...but ) ID#261269:

What do you foresee for silver ?

Mr. BillD,

It will not be purchased as a currency replacement. But, in the minds of persons with private holdings, it will be as a currency in time of change. I think it will gain much, but only after a trading halt by gold. Percentage wise, it will not equal gold as many expect.

Date: Sat Mar 07 1998 20:17

Psilver Psyched ( @Another ) ID#216217:

The USA has been openly courting Venezuelan oil?

Mr. Psyched,

Please reread the most recent posts from Another. Your question should be: Why would the USA buy most of it’s oil from Venezuelan when it would be far cheaper to buy it from the ME using gold? It is possible that the new oil bid will come about with the introduction of the EURO and give that currency the oil backing!

All: If the EURO is backed with gold in a large way, oil may be purchased with EUROs and even a smaller amount of gold!

Date: Sat Mar 07 1998 20:55

Lurker 777 ( Another ) ID#317247:

Mr. Lurker,

As a person learns, so to does he act! As in all things of life, it is more safe to follow a well walked trail. Truly, many have walked this path of gold. But, as no two men can take the same step, each must gather wealth as his experience will allow.

There is no standard percentage of gold for all persons.

Also, the CBs may start to call back their leases. Together, we will read this new book of gold.

away...to disembark

ÉßonVoyáge©

Ted, hold the fort.

Date: Sat Mar 07 1998 18:19

WetGold ( @ANOTHER ) ID#243180:

What do you know of the Dinar comments posted from the Islamic Mint ?

Mr. WetGold,

I understand it. I do think of it as the beginning of a change in the perception of value by all persons.

Date: Sat Mar 07 1998 19:22

SWP1 ( @ANOTHER ) ID#233199:

Mr. SWP1,

Please study the history of wealth as it has moved thru time and change. What your perceptions of value are now? Follow in the footsteps of times past, trace it’s steps in the minds of others. You will find the value for your future lie in gold today!

Date: Sat Mar 07 1998 19:30

Snowball ( @ANOTHER ) ID#234218:

Mr. Snowball,

Please read the: Date: Sat Mar 07 1998 15:10 ANOTHER ( THOUGHTS! ) ID#60253:

Gold will become a currency “of choice” by all, for the benefit of all. Those of “lost paper wealth” will not remove coins from the world. They will use this deep currency as a building tool. Coins are good!

Date: Sat Mar 07 1998 15:47

Delphi ( @ANOTHER ) ID#258129:

What will happened with oil price in long term, when reserves of it will be mostly consumed?

Mr. Delphi,

A good thought, sir! Perhaps, oil will be replaced in 20 or 30 years? Oil has a very short history when compared to gold! I would say, my oil should be replaced with gold for that time to come!

Date: Sat Mar 07 1998 16:32

chas ( Another re gold in the ground ) ID#342282:

Mr. Chas,

During the time that must come, all forms of paper ownership of things will come into question. Many persons have accepted the “wall street/gold stock” way as a true holding of gold, it is not the right holding for our new future! This new gold market is not as before and will bring much confusion of the “perceived values” that mines represent. Indeed, a mine may hold the value of $1.00 as all other things fall to $0.00, but it offers no safety of worth, if you purchased it at $20.00. It will be a bitter lesson for gold investors with a short history of life. good luck

Date: Sat Mar 07 1998 17:11

Jack ( MR. ANOTHER ) ID#252127:

Is my reasoning correct?

Mr. Jack, The outline you have given, will no doubt, only be the beginning. I must ask anyone, if gold went to even $10,000/ oz.in current purchasing value, would that not be enough? History has shown that persons that hold gold during times of change, do always find a better life. Think now, if you lived in 1975, would a 8,500 Dow not have looked as “not a real expectation”, but thinking and perception of value does change!

Here I thought, that high-tech was going to save our economy! Now, ( cut to a scene from, Casa Blanca ) I'm SHOCKED! SHOCKED! TO FIND OUT THAT GAMBLING, err, I mean, that we need to import workers because there's no one left to do the high tech jobs here...

Sounds like to me, that someone screwed the high tech workers over in the early ninties and now payback is a bitch. Also, the bottom line will be getting hit soon enough. Intel's warning should start, at least a tiny fire in every gold bugs heart. Intel's overhead costs are going up. Translation, labor costs more.

Date: Sat Mar 07 1998 15:18

OLD GOLD ( Paper Gold ) ID#238295:

What do you see as the likely trigger for this anticipated golden

earthquake?

Mr. Old Gold,

The US$ price of gold is, now held between several extremes. In Nov. of last year, a understanding was reached that the “paper gold” market was out of control. The private market was using this medium in a way not intended. Gold was to be taken and held in the $320 to $360 range. This was good for all. As the down trend was not seen in price yet, it was known that trading was in place to drop the price. Perhaps, even below The BIS capital level! Several very large physical buys were made in the off market ( see Date: Sat Nov 29 1997 15:53 ANOTHER ( THOUGHTS! ) ID#60253: ) as a warning. At that time the CBs started a slowdown in lending and sales. The market came close to a major resolution. In Jan. the BIS was close to a large open move, it would have caused a paper

panic.

Oil will not accept the position, as is. Gold must come back into range as oil falls no further. Any loss of perceived control by the CBs will trigger a bid by oil. It would be better for time to pass and allow a natural change to the new oil currency ( perhaps 1 1/2 years ) . However, it is now my view that the CBs have lost control! I expect a break above $360 to create an allout run to infinity, before year end. Physical gold should be purchased for a lifetime holding, not a trade.

thank you

As far as the CRB goes, if the economy is doing this good, then the demand for raw products will be there. This will have to show up in the CRB. Lumber anyone? I see more buildings ( commercial ) and homes going up all over the place here ( Northeast ) . To boot, I see construction teams working on Saturdays too. Hmmm, sounds like time-and-a-half to me. Now in the end, these buildings maybe vacant, vis-a-vis the late eighties real estate bust, but for now, they're going up fast!

Select your poison ( index ) of choice, ( yes, the XAU is here to. ) Go to the 'symbol' window, select the pulldown button and choose the information that you want to see. Select 'submitt' and place your bets.. :- ) )

Does anyone care about the bond market moves here? What about the employment reports? Other currencies? HELLO!

Or are we all convinced that the Great Depression II is here.

The overiding belief seems to be the Fed will not raise rates because of the Asian 'problem'. What if they did? What if the tech companies CAN'T find enough engineers and technicians to meet their needs? How does the market solve this kind of problem? What does this mean to the companies bottom line and earnings? Finally, what do these people do with all of this money?

Perhaps the CRB should be looked at a little more closely in the coming months... Who knows? Maybe even gold might move...

Also, beware of stocks with large floats and miniscule daily volume. Somebody owns the stock and is clearly in no hurry to part with it... Always try and find out who owns large blocks of the stock. Is it a fund? An individual? Some group? Always know as much as you can before you sell something that isn't yours... AND ALWAYS CUT YOUR LOSSES SHORT. Thin markets are very hazardous to your financial health in this regard. The only thing worse ( I think ) is trying to sell a gold stock when no one wants to buy it...

Organization says we are not doing so bad, have everything lined up, these systems are fine - we just developed them using the latest technology, this other set of systems will be replaced before year 2000, and this other sets will be renovated on time.

Then we are asked to come and look how are they doing. We go, we look, and here is the real story:

1 - systems which were suppose to be fine because they are new ARE NOT OK and need to be fixed

2 - systems which are suppose to be replaced are significantly behind the schedule, and without some cuts in new functionality, or throwing much more money on it ( if that buys anything ) , they won’t be ready on time

3 - renovation of few legacy systems has not started yet because all effort is put into new development and replacement of more critical systems.

4 - there is no real plan to deal with this thing - just a plan based not on the reality but on reporting requirements - so we can look good.

At the end of this assessment there is a panic and statements Oh my God, how are we going to deal with this?. Mind you that we are not for profit company, can not compete and bid for renovation work, no money gained, just trying to do an honest work and give them an early warning you better improve before you are beyond of any hope!

Date: Sat Mar 07 1998 13:58

Carl ( Another ) ID#341189:

In your scenario as I understand it, gold would only buy oil, nothing else, because the physical gold market would be shut down.

Mr. Carl, This is a misunderstanding. See the words from “The Management of Gold, A Simple Tool for the 90s “. They show how the price for metal is now made by the paper gold market. It is this “paper gold” market that will be destroyed, first! As Mr. Mozel has shown in his post of Date: Mon Feb 16 1998 17:55 mozel ( The United States Empire )

ID#153102.

“The second threat is, I believe, more out of sight, but more serious. This is the threat from derivatives, the $100 Trillion crazy aunt in the attic. “

Please reread his write. When a “world oil currency” is formed, it will bring forth a great turmoil. Even physical gold will not trade for some time! But, as paper loses are resolved, the governments will form some kind of real gold market. Perhaps, the BIS will make the market for the world, in much the same way as the LBMA. Understand, the new gold physical market will be not as a commodity, but as a free currency!

Date: Sat Mar 07 1998 14:10

mozel ( @Another ) ID#153102:

If this thing were to come to pass, it will not end with contracts for oil only in gold.

Mozel, you have a good grasp for the currency issue. I ask you, can you see the benefits?

Date: Sat Mar 07 1998 14:20

Delphi ( ANOTHER - a long-term question ) ID#258129:

Mr. Delphi, In the time from where you speak, gold will have become as, common use for all! No country or entity will not use it for all trade. Do you not agree, it is good for our families and children?

We,the students,express our thanks for your thoughts .

We,the students,are open to any thoughts that may unravel

this mystery of gold------oil---------USD--------politics.

We,the students,don't need no thought control .

We,the students,are beginning to piece this charade togeather.

All in all it's just ... ANOTHER BRICK IN THE WALL .

Thank You

I would like to start with a post from a gentleman from the Kitco forum as it sets the tone for this article:

Date: Fri Jan 23 1998 22:57

Junior ( @ ANOTHER & Change ) ID#248180:

I am reminded by ANOTHER'S comments regarding Change of a profound statement by a spokesman from the Middle East Oil Producers during the mid seventy's ( approx.1975 ) He said:

My Grandfather rode a camel, my Father rode in a Mercedes, I have

numerous Jet Aircraft, my Son will ride a Camel.

It provokes thoughts that the countries of the Middle East and China are not as nervous about change as the consuming and material minded nations of the West.

Mr., Junior, thank you for that deep thought!

During the span of ones life we must consider weather we really do experience changes or are we just experiencing a rebirth of old values from the past, repackaged for this modern world. In times past, real money did not earn interest unless it was lent out. Yet, it retained value relative to all things. Today, paper currency, also does not earn interest unless it is lent out. However, it does lose value against real things, over time. In this light one must also grasp that a currency unit, in hand, is “lent out already”! It is a credit, to be paid in the future. Truly, cash, outside the banking system is a receipt for “lent out money” that just doesn’t earn interest!

Much of the discussion of today, evolves around; How does one recognize real money? My answer is, find the largest store of financial units, held by banks, that is not lent out and does not earn interest. It is by far, gold! There is no other unit, in the world today,that meets this criteria. Even with the current mobilization of bank gold, it is still the number one holding of “non paper credits” that is not lent for return! Some would point to it’s price in US$ and say, it does not hold value relative to real things. That would be true, but gold, while allowed to be “freely convertible” into any currency, is not allowed to

trade “freely”. It’s price is managed. It is “The” “political metal”!

We can find one entity in this modern world that firmly holds that gold is “the real money amoungst moneys”. That entity is the BIS. They are the only bank in the world that can buy physical gold and become financially “stronger” with this act. They are “The Bank” and their central holding is “The Money” of today. Other CBs buy gold and show

it’s value as a liability as it is not marked to the market. Yet, they can hold capital of the BIS and it is as a 100% asset!

In this modern financial world, a person of little business knowledge, can make an investment of “world class” proportions! He may, if you will, “walk in Anothers footsteps” and in doing so receive a value for a lifetime of work. The coming change in perception of money will reward courageous buyers with a return unseen in these times!

To use a sophisticated paraphrase from the Kitco Forum, “go gold”!

thank you

When one considers the merits of a specialized world oil currency, the thought usually turns immediately to “send in the military and stop them”. I must ask, why? If an oil currency is born before or out of the shambles of an financial meltdown, and it offers great benefit to all, again I ask, why stop it? Look at the merits of such a move:

In a very real “currency sense”, oil will be devalued in terms of gold. As one makes a currency weaker by increasing the money units per ounce of gold. Oil will become very cheap in gold, as the amount of gold paid per barrel will fall dramatically as compared to today’s ratio. There will be much more than enough gold worldwide to quantify a “world

oil currency”. To that end, the world paper “reserve currency” at use in that time, will continue to be traded for oil at an extremely low price relative to today. The only change will be the addition of a “unit of real value” added to each trade, a “world oil currency”, gold! However, in terms of today’s currencies, gold will be “upvalued” to perhaps $10,000 to $30,000 an ounce. So as not to rewrite what is already an excellent piece on this coming readjustment, I will repost part of Mr. Allen ( USA ) ’s perfect article on the subject along with his requested changes per his :Date: Mon Dec 15 1997 11:06

Allen ( USA ) ID#246224:

Date: Sun Dec 14 1997 18:59

Allen ( USA ) ( More ruminations re: ANOTHER's recent posts ) ID#255190:

Last one on this topic until more ANOTHER posts. I'm not sure that it would be necessary to have that large a cabul in on the offer of oil for gold. Given the rather small market in gold in comparison to oil/currencies it would only take one or two well endowed oil states to pull this off. Here's why.

Let's say the Saudi's have been accumulating gold through the back door ( approx. 5,000 tonnes ) . They sell say 20 Mln Bbl oil a day. Close enough. At one ounce of gold per thousand Bbl oil that's 10,000 ounces of physical gold per day. That's a lot of physical gold.

The first few moments after the Saudi's proposal to trade oil for gold at a very steep discount of 1000 Bbl/oz ( approx. 1.5% of current US$ price ) there would be roars of laughter. One fast thinker after another would think Hey. I buy some gold at $300/oz, trade for oil to receive 1 Mln Bbl, then sell the 1 Mln Bbl for US$ 10 Mln. Net profit is

$10,000,000-$300,000=$9,700,000. Easy money. .

Everyone at once turns to the gold market to buy, which promptly shuts

down. Now no one is laughing. Because everyone realizes that gold is now

worth at least $10,000 per ounce and no one is prepared for that revaluation. Whoever has gold now has 66.67 times the purchasing power in that stockpile. What appeared to be a stupid offer has now become a complete revaluation of all gold stockpiles vs all currencies.

Who has the gold?

( per corrections :Date: Mon Dec 15 1997 11:06 Allen ( USA ) ID#246224: )

Saudi stockpile guest-imate 5,000 metric tonnes = 5,000,000,000 GRAMS

not ounces. Gold now at US$9.65 per gram revalued by multiple of 66.67 =

US$643.37 per gram x 5 Bln grams = US$3.2 Tln.

Germany 2900 metric tonnes = 2.9 Bln grams, revalued to US$1.8 Tln.

USA 8,085 metric tonnes = 8.1 Bln grams, revalued to US$5.2 Tln.

Is this plausible? How is it possible by making one little change in oil dealings could this ever happen? It is simply the very intelligent use of the scarcity of gold and the necessity of oil. It is the desire of one party, who is big enough to swamp the gold market, to make it the preferred vehicle for buying oil. In fact if not one ounce of gold is ever transacted for oil, but the offer is continued intact, then gold will be revalued simply by the possibility of trading. Those who are in a bad way in their currency situation can always get oil with their gold.

What would the impact of this revaluation of gold and currencies do? It

would instantly shift economic and financial power into the hands of those who own large amounts of gold: CB's, Saudi's, Roths et al. It would mean that gold/oil would be THE CENTRAL POINTS OF ECONOMIC REFERENCE. It would mean that currencies would be devalued by a factor of 1000 in relationship to the new standard of gold ( as a proxy for oil wealth ) It would upset an awful lot of people. There would be no TARGET to shoot

at or take over, however, because all other oil producers would immediately jump on this band wagon. Its a simple matter of what an interested party is willing to receive for their goods. Venezuela, with gold and oil reserves and production capacity, would be one of the wealthiest nations on earth. The world would be turned upside down geopolitically, wouldn't it. Literally

..the 'have-not’s of the world will become the 'have's..

Mr. Allen ( USA ) , Another thanks you for this thinking. It should be read by everyone with an interest in this area. It should also be studied by students wishing to learn of market dynamics. We also offer this piece as an addumnum to the above, also by the same author.

Date: Mon Dec 15 1997 10:49

Allen ( USA ) ( Quick Note to JTF re: 23:05 post - US$ oil float ) ID#246224:

US$ price of oil is floating. The proposal to offer oil for gold at say 1000 Bbl/oz is far below the present float price in US$. The gold market is SO SMALL that if the oil nation that made this proposal was pumping enough oil the gold market would be swamped by oil buyers who were looking to make a few ( !! ) US$ on the discrepancy in price. In effect this would revalue gold by inserting an entire different group of buyers into the gold market who have ALOT of mney.

Why is it the oil nation would not just buy at market? Same as above. Their effect in the open market would basically shut down the market thereby frustrating their efforts to buy gold. Conversely, why would they then make the proposal? Because either they have enough gold to buy the world at the new price, there is a crisis in which they feel it is to their advantage to do this ( such as a US$ crisis ) or they might have a geopolitical rational. In the new valuation the US$ would still be intact. But its monopoly role would be altered. Its not that currencies would become worthless but that gold would become worth much more in relationship to paper currencies.

To answer the “military” question, asked at the begining of this article, I say:

The massive increase in the “reserve currency” price of gold would, no doubt be ushered into the USA house of congress as a godsend answer to Americas debt problems. With the “full production” of oil, now viewed as a sure thing, The world may well see the USA send the military into the Middle East just to ensure that this “deal” is not disturbed. After all, it is oil that will be massively devalued by gold.

Thank you

For any currency to maintain a “reserve” status, it must be, in some fashion, convertible into gold! In the past, the US$ was freely exchanged for a “fixed” amount of gold. $20 dollars was equal to one ounce. If the country wanted to make it’s money stronger, it would lower the amount of currency units fixed to one ounce. $10 dollars per ounce made the currency more valuable in the market and it would buy more things. Also, a country could decrease the value of it’s currency by raising the number of units to the ounce of gold, say $40. The problem with the “fixed” gold system is found in matching the amount of gold in the treasury to the “fix”! To make the money stronger, one had to bring in gold, as it took twice as many ounces to back a currency “in circulation” at $10 as it did at $20! The reverse is true when lowering the money value to $40. Then, one half the treasury gold backing had to be removed as only half was now needed to back the dollar.

You have probably not read this “slant” on the past gold standard because it was never quoted in quite that way, nor looked at in that fashion. If you allow your mind to perceive the above, one will clearly see that it was gold that gave the currency value. In that time one did not look to see how many dollars gold was valued with, rather, how much gold was bid for each unit in circulation!

Today, the world reserve currency is not on a “fixed” gold standard, it is on a “freely convertible” gold standard. One may, anywhere in the world, convert US$s into gold. This new “freely convertible” standard does still allow the dollar to be backed by gold for those who still demand a gold “fixing”. That requirement is enforced by a certain

commodity, oil. Yet, there is a price for the benefit of having all oil sales settled in US$. Yes, even in this modern era, for the US$ to remain on an “oil standard” it must be on some form of “gold standard”! Regain the perception in the top paragraph. Then understand that for oil to back the dollar, the dollar must find value in gold. And the dollar finds more value if it is fixed by the “freely convertible” gold standard, to buy more gold!

This convertible gold market is old from the mid 70s but is new from the early 90s. It is old by the 70s because it is “freely convertible”, but it is new by the 90s as it “is not” “freely tradable”! The US$ price of physical gold is no longer “fixed” from supply and

demand, rather it is “created” through the market action of “paper gold”. Truly, it is the US$ has become the “item traded” in the “paper gold” market, not physical gold. Participants have yet to realize that the gold futures, gold options and gold forward markets, worldwide, have become little more than currency trading arenas. The percentage of gold delivered against these markets has grown so small as to be nonexistence when compared to actual metal settled at closing. Physical gold does still move, and in size, but this is little or nothing compared to the “paper gold” traded.

We are brought to this point for a purpose, but how did we get here? The largestproducers of gold were introduced to the use of large scale “forward contracts” by the Bullion Banks. Once the process started, good business required it to expand. Shareholders want maximum profits at all price levels and “forward deals” were good at any price of gold. Once hooked on “hedge profits” during the good times of a high gold price, the mines now “must have at all cost” “forward deals”, just to survive. Some say the mines will not forward sell at these, break even prices. However, the shareholders say it’s better to hedge now, for a lower price will bring doom! With the US$ price of gold holding at just above average break even levels, and the ensuing virtual bankruptcy of several well known companies, it appears that the mine owners are correct.

Understand, that many entities lend gold, but it is the CBs that started and do most of it. Their purpose was to create a “paper gold” market that would allow them to manage the “freely convertible” price of gold. The CB lends the gold to a bank that sells it on the open market.

( Usually, the gold is placed privately as it must go to the correct

destination. ) Then the bank holds the money and draws interest as incremental payments are made to the mine for new gold delivered against the contract. Over the long period that a mine takes to produce and repay the gold, this money grows. To grasp the fact that the CBs had a plan, is to know that they lend the gold for only 1% or 2% while the proceeds set in a Bullion Bank and grow with interest for the benefit of the BB and the mine! And further, the lenders allow the return of the gold to be extended out for many years, as in “spot deferred”. The CBs allow public opinion to think of this as “typical government stupid”, it’s not!

Now that the gold price in US$ is around production cost, most mines must use “paper gold” to survive. The gold industry is coming under world bank domination, without signing away any sovereignty! Slowly, the CBs are gaining the ability to manage production and price with this simple tool.

“If they want new mine supply on the market, they roll over the contract to the BB. If they want new supply off the market, they allow the BB to pay for and take delivery of the gold and return it to the CB vault.” “Also, by offering ( or withholding ) vault gold from lease, they affect the lease rate and thereby control private lending as well”

Understand that the second sentence action is used because gold lending is done by many different entities. Many times a mine isn’t even involved. Sometimes, gold isn’t even involved, just paper. But, it’s still based on the gold price! The paper price, that is.

thank you

Date: Sat Feb 28 1998 16:33

ANOTHER ( THOUGHTS! ) ID#60253:

I offered, that these thoughts would be as “morning sun thru the fog of night”. Today, this sun does shine. Kitco does offer a public right, for all to see. We step forward and make this “right” as day. Please read the post that soon follow:

The Management of Gold, A Simple Tool for the 90s

A Noble Purpose, This Oil For Gold

Change

At appx. 19:00 USA /CST I will offer a post for “Price”.

thank you

By the way -- all may aguements about the weakness of the SDR go out the window if it is firmly gold-backed. That is clearly the way to go -- it is just a matter of knowing when the 'fiat' currency world is ready for a gold-backed currency -- and knowing what will be chosen!

So -- what will it be? A return to the depths, or a fledgling gold bull? Personally, I think only war, or a non-deflationary crisis in Europe would do it. Another major deflationary crisis in SEAsia -- obviously brewing as Jin has told us -- would be bearish for gold.

Strikes in South Africa are likely if the gold markets do not recover very, very soon. That might be bullish for gold outside SAfrica -- I defer to the experts.

We may need to trim our sails abit for the coming storm. We will have plenty of time later to invest in the world's only truly incorruptible medium of exchange -- gold.

My guess is that the SDR will remain regardless as a basket of the world's strongest currencies -- unless something better comes along. I think that somehing better will be a gold-backed currency. Despite what Alan Greenspan said -- probably 'tongue in cheek' -- a gold backed currency is still a better choice than a currency basket -- because of Gresham's law. In one sense, we already have a 'black market' world gold standard currency at the LBMA. Now at 2000tonnes/day?

What better international currency could you use than one that is firmly backed by gold, and hence incorruptible? And -- during times of crisis -- flight to safety,etc. I think it would still be there to use -- unless someone figures out how to hoard it.

I agree with SDRer, Carl -- you are always thinking!

Secondly I would guess the SDR will stay as it is -- a 'backup' basket currency for international exchange, with the exchange rates as published. If the German mark and the French frank were to disappear off the face of the earth, then the SDR would change -- probably with the addition of the EURO as replacement.

I have learned something else about the SDR -- perhaps SDRer will enlighten us on this matter. And that is that the SDR cannot ever be as stong as the strongest currency making it up, because it is a composite. However, it will always be stronger than the weakest currency, for the same reason. Hence, during a period of serious 'currency flight' the SDR will weaken relative to any stronger currencies. So, liquidity of the SDR is suspect during a full-blownout crisis, since all of the liquidity will be fleeing to the strongest world currency available. I suspect that this is a corollary to Gresham's law. Thus, strange as it may sound, you will always be better off putting your money in the 'strongest currency of the year' whatever that is, than you will be in the SDR.

So -- you do reduce fluctuations up and down with a currency basket such as the SDR, which makes it an excellent international medium of exchange. But as a place to put your savings, it would be best to put them in the strongest currency of the basket. And the liquidity in the SDR may not be there when you need it - in a really big crisis.

SDRer -- comments? You are the expert!

This is not say that the tech stocks are dead, but there is trouble in happy land. The question could become, Is this a classic 'narrowing' of the market?

With unemployment at 4.6% nation wide, and the tech industry trying to loosen up imigration laws for more foreign engineers, one has to wonder, are labor costs that far from moving up? I think not. Keep an eye on the CRB. This should be getting interesting soon.........

According to the morning paper, NASA has found over 6 billion gallons of water ( ice ) at the poles of the moon ( where the sun doesn't shine! ) . They used a passive neutron flux detector in orbit to detect the hydrogen, rather than the water directly. Sceptic that I am, I would stil l be much happier if we actually landed something and tested directly. But at -170 or so Farenheight at the lunar poles I do not have any suggestions. Regardless, NASA found a lot of hydrogen at the poles, and the most likely guess is ice.

See you all later!

I guess what is happening is that the Chinese are trying to hang on without devaluation, and consuming their reserves. When their reserves dry up, then we will have the devaluation expected.

I find all of this information gathering and interpreting frustrating. We can see what is happening, and we can see what is very likely to happen, but we cannot tell when. Reminds me of my days canoeing on the Connecticut river at night one time -- was terrified because I could hear the rushing water of a large dam up ahead. But -- I could not tell how far away it was.

The 'acquisitor' banking money collecting types have about shot their wad, and it is time for the 'worker' types to rise up and take over. It will be interesting to see what kind of 'warrior' type is handed the reins of Indonesian government by the 'workers'. I am using the terminology of Sarkar, who seems to be an unusually insightful analyser of human cycles throughout history. By 'worker' I do not mean this in the communist sense, but in the sense of the general public who have lost their assets to the 'acquisitors'. In the US the 'worker' would include me -- the middle class. And -- the same thing is happening here -- but it is not as advanced.

Indonesia's only chance of avoiding civil war is an emergency bailout by someone. But -- this is complicated by the fact that the corrupt business practices in Indonesia have probably not been corrected. Hence, much of the money sent to Indonesia will vanish in the deflationary black hole, never to be seen again. I doubt that any nations will step in quickly enough. Hope we have lots of ships near Djakarta to pick up evacuees. The staggering thought is that we are talking about a population equal to that of the United States -- about 200 million individuals.

My guess is that it will get worse before it gets better, IMHO. Jin - take care, and please keep your head down inside that foxhole I hope you have, or something like it.

The whole idea of the internet is distributed processing, so how could any single processor ( almost by definition ) have all of the internet data, even if it was massively parallel. I wonder, just how many satellite-based core internet links are there? My guess is that the listeners have a trigger device of some kind so that they only store data of interest, something like the way the IRS works -- certain key words are used as triggers. That might work, though the computing power needed is still staggering. Just wait two more years when internet traffic has quadrupled.

Since we are talking about confidentiality, etc. I have one other comment. I sent a check for about $1000 out of the USA about 6 months ago. I have sent small checks out before over the last ten years. But --- this time, when it was returned to me, it had a narrow yellow stripe printed on the back. First time I have ever seen this.

Comments from you or mozel? I think all money transactions in the US leaving the country are being monitored, no matter what their size --despite the offical threshold of $3000 ( not $10,000 ) . I find this staggering when I consider the cost of such a monitoring system. Thoughts from the legal eagles?

I enjoyed your quoting of Hamlet to hamlet.

Thanx !

Somebody had mentioned kitcoites sentiments going with the market. Thursday was depressed which caused ( ?! ) Friday to move up. Saturday is mildly optimistic or split, which will cause Monday to be a No Show ( ? )

Has anybody ever checked this relation here ? Could be better short term indicator than T.S. Eliot's Olio Waste or Dante's Peak Fibonacci Infernale Furioso. But my preferred Medium Term Tool remains the 'Antipodeon' ( or Antilopean ?, Antistochiast ? ... )

Bart: Help, is there a search tool for the Kitco posts by key words, such as

Pork Belly-Up, AG Limit-up, BC Trousers-down ?