All: Derivatives traders please correct me if I am wrong, but I am guessing that the derivatives crisis -- if it comes -- will be related to the dollar volume at the time of the crisis. If the derivatives markets break down during a crisis, alot of sophisticated, 'presumably conservative' trades will get unwound, with substantial losses roughly in relation to dollar volume. Just as with Leeson and Barings or the Orange county fiasco, the disaster will unfurl when losses are reported.

So -- the more complex derivatives trades, the greater the risk of loss during a sudden market convulsion ( prior derivatives trading rules no longer valid ) . And a few months later, losses will become public. So I think it is reasonable to assume a delay of several months between the time of the actual losses, and when bad earnings reports affect the markets.

Another market convulsion like the Oct 97 one could cause many banking and investment firm profits to plummet.

Thx for keeping me up to date.

Auric are you sure GSC is writing under a different handle? If he does I can't blame him because he took lots of flack last fall on this site and I think he was using his real name in lieu of an handle.

I have been travelling a lot in the last few months and didn't keep up with the daily happenings on this site.

I notice that Aurophile, Vronsky, Glenn, GSC and the infamous Hepcat seem to be missing.

I wanted to tell GSC that, contrary to his repeated advice, I never sold my stocks and I am still fully invested, but I guess he'll never know.

Ted is still around and so is Cherokee who is forever standing on the shoulders of giants and LGB and few others I recognize.

Wish you all well and plenty of wisdom with your investments.

Please use caution -- I am not sure what the source of this data is -- may be biased if it is from Communist Chinese sources -- but it is interesting regardless.

http://www.chinaeco.com/freport.htm

http://www.drudgereport.com/1.htm#1

Pete

Acting on the ANOTHER insider info, gives you the chance to be either a king, or one of Twain's fools. Gentlemen, place your bets.

Another has put,his thoughts in clear view,

For all to ponder,as he bids Kitco adew.

You now have substance and reason to ask,

Was this just a prank,or facts under mask?

Time is agian,the subject of contention,

The direction is clear,tick tock,as I've mentioned.

Those traders,who's calls have been fair in short terms,

Must look at the big picture,let no stone go unturned.

Time is the keeper,this gold market has changed,

When all's said and done,it shall be rearranged.

Cries from the pits will echo so loud,

Self exposure will result,informing the crowd.

Don't worry!be happy!patience is your friend,

Your in good hands now,believe,this market will mend.

Thank You

J. M. - Yet one more ex-friend of Bills's, now deceased. Part of a long tradition.

The email address is

murabitun@netmatters.co.uk

Dear Sir,

Thank you for your appreciative support. I would love to participate

in your discussion group.

Our cause is directed towards establishing the gold coin

as a common medium of exchange. We believe that the success of the

coin is the success of society. Therefore the issue is to bring

it as close as we can to the everydayness of our people. That means

recreating that new/old institutions and instruments that made in the

past the use of the coin be natural. The key word is trading. If we

combine natural money and trading we have an atomic bomb.

It is important to distinguish between trading and monopolistic

distribution. What the World Trading Organisation calls trading

is monopolistic distribution. Trading is something else. Trading

cannot exist without a market place. Today we have supermarkets

and trade is now distribution. In Islam ( and you can trust me that

fundamentalism is not Islam but something alien ) trading, its

institutions, its means and its contracts are defined with precise

details, like a recipy book, based on what Allah says in Quran:

Allah has permitted trade and forbidden usury.

Recreating the general conditions of trading in which the gold coin

existed in the past is a necessary part of facilitating its

popular re-introduction. This is of the nature of reconstructing

society. Also the spiritual dimension offers a superior overture

on this issue.

We have a duty and a responsibility. The good news is that the battle

against the fiat money we have already won. Fiat money betrays

itself. If we had all the resources in the world, we could not do

a better propaganda against paper money than what already it

does by its own existance. Just like you do not need to say how

horrible is an earthquake. Usury, without which paper money would

not exist, is a self-indulging existential disaster.

We, the good of the story, have to simply let it happen. Our role

is not become the obstacle. Often intellectuals bring the matter to

such specialist hights that people, the ultimate aim

of the coins, are lost or forgotten. We should free the gold coins

from us, the true and committed defenders of gold. It is important

that we surrender the matter to where it belongs, the

people's pockets. This is where understanding the dinamics of

society, trading and wealth becomes the difference between

helplessness or success.

THE ISLAMIC MINT

Umar Vadillo

Unless some big player is being forced to buy gold, I think the gold bullion situation is neutral, at best. Some big players may want to keep gold price down longer, so that they can buy the whole gold mine at $10/oz!

I hope I am wrong about this -- because Venzuela and Mexico could get hard - hit, as well as a few other Oil producers. This could trigger a South American deflationary collapse.

My guess is the Saudi Arabia is well-enough off to maintain high levels of Oil production to knock out the competition. Interesting times we live in.

My intuitive guess is that we will have inflation in the US before we have deflation, given the strength of the US markets and economy, and 'flight to safety' from other parts of the world.

The real threat is deflation -- worldwide. We seem to be repeating a scenario similar to that of the 20's and 30's when deflation hit other countries first, and the US last. The US dollar was inflated starting around 1925 or so, on the request of those desperate European bankers who were upset about losing all their gold to the US, as I recall. Eventually the US market bubble collapsed, and deflation hit the US -- years after deflation hit Europe and much of the rest of the world. One thing we are especially bad at on Kitco is assuming that the credit crunch will happen all at once -- world wide. It is likely that it will not -- thank God! I'm hoping that by the time the US is hit, SEAsia will be on the road of recovery. Of course, they may not have much trade with US and Europe by that time ---.

If you are the super conservative type -- I would put all your assets in to a bullet-proof location -- because after the credit collapse, gold will shine! Right now the gold investing cross currents are confusing, and choppy. First we have bullish news, then we have bearish news for gold with each currency collapse. But -- we are reaching a gold bottom, I think ( and hope ) -- and gold should rise for a time before the next big deflationary crisis.

By the way, after the US markets weather the current lousy earnings reports on computer-stocks, they will have to weather another storm in Banking losses -- all of those derivatives trades that went sour! If the turmoil is spread out -- gold and gold stocks will do well. If the equity markets get hit with another 1987-type blast, I'm not so sure. I think turmoil and uncertainty are the rule.

You may have a point.

A read a book some ten years ago concerned with South Africa - London - Hong Kong - China, and the trade off of GOLD for Opium/Heroin. this basic trade was established by the Brits YEARS ago, and it is likely that the connection continued until last July, when the Chinese took over Hong Kong.

It is remarkable that ALL the financial troubles started then.

So, over the years the Chinese have traded for gold, and they have a long history of gold mining - the West simply never saw that.

The connection, now-a-days, may well be .............

Oil........Saudi.........London

Gold.......South Africa and else where...........London

Opium/heroin..............China............Hong Kong...........London

London........London..........London

Find out who YOU really are.............

http://cs6400.mcc.ac.uk/genuki/

Will we be kings, or cabbages?

As I suspected, gold and platinum continued moving in the ever-tightening pennant bounded above by the top of the long-term, downward-trending channels, and below by the bottom of the short-term upward-trending channel.

Time has run out! Gold must break out of one of these channels this week.

Silver made a perverse move, seemingly breaking out of its long-term upward-tredning channel. It is intensely volitile, but it seems that its rallies lately are bounded by a steeply dropping line of resistance. Unless it breaks this, things look bad for silver, and this could take gold and platinum with it.

This is the week. Either the bear ends now, or, like the groundhog, gold will see its shadow, and drop back in its hole, for 6 more weeks of winter.

Your information -- now much more specific and clear that before -- is appreciated.

Aye, being a New Age Scotsman and an Exploration Geologist, I can only....... feel humble that I do not know many of the Short Carriers of GOLD.

I remember the days back in Zambia between 1975 and 1978 when I used to do geological field mapping in the bush, I always managed to avoid the Elephants.

I wonder if our Short Carriers will be able to do the same.... and avoid the crush ?

Aye, it makes you wonder ?!

Prudential-Bache International Limited and Rothchilds.....

Australian Gold Fields Nl had an Administrator appointed today.

The Company had entered into a series of PUT OPTIONS with PBIL in gold and silver. It appears that due to the Morobe and Wafi gold/silver projects not being on schedule ( 5.6 Moz gold & 63.6 Moz silver ) .

This has caused the Company a severe cash flow situation, with PBIL with holding funds. The Company is now deemed to be insolvent or to become insolvent in the future.

This is a classic. GOOD projects........what a carve up !!

The purchase of large physical stocks of gold in Nov. did send a message to the CBs. They did begin slowdown of sales/easing. The “management tool of gold in the 90s” ( see Date: Sat Mar 07 1998 13:08 ANOTHER ( THOUGHTS! ) ID#60253 ) is now to go into reverse! A large purchase, now, is sending another message, “bring gold back into $320 to $360 US$ range. We should see this in five to ten days. This will be a hard thing, as it may create a crush to cover. Let us watch this “new gold market”, as it is not as before.

I will post later in march!