Gold will go down if the Japanese sell gold. But -- as several Kitcoites have said, the Japanese people probably will not sell. But -- what about the Japanese government? It all depends on how much paper they have to dump first -- US dollars to generate more yen to buy Japanese stocks?

The only thing we know for sure is that after after this crisis is over, gold will be more dear than ever.

http://www.tml.co.za/bt/96/1006/markets/markets2.htm

and it worked too.

It's a lot easier sleeping with gold funds and not worrying about one stock plunging to new lows all by itself. Since February 1996 was a lousy time to buy gold funds and most gold stocks, I think it was probably a lousy time to buy ABX also. BGEIX owned all of the major gold stocks then and obviously has not recovered yet. No gold fund has. I don't think any gold stock has either.

Here’s why.

If you take a look at any gold fund prospectus you will see various stocks listed along with share purchase warrants for the these gold stocks. These warrants were received when the fund participated in private placements. These placements were done at much higher prices than exist today. The warrants are therefor under water and worthless.

If gold rises, the stocks in the fund will rise and a fund owner also has the possibility of the warrants value going from zero to ?. If the warrants get a value, the funds NAV will take a larger jump than if only shares had been owned.

It is very clear from your stories that silver is going up for some time -- probably well over $10.00 before the dust settles. This will push up gold, too.

Any idea why there is an 'oil glut' but energy/energy services stocks just won't go down? I thought we would see the demise of an oil producer or two before the energy equities started back up again.

I have a true Mainer ( Maine, USA ) story for you. Turns out that a large Japanese freighter ran aground during a winter storm near Searsport. I think it was called the Tojo Maru ( name may not be exactly correct ) . Saw a life prserver from the Ship in a Searsport restaurant. Seagoing tugs from Halifax were either too small to pull it off, or were unavailable . The only offer was for salvage, which the Japanese did not want. So -- the Japanese owners were desperately discussing their problems in a that same little restaurant in Searsport, and some of the ( underemployed ) local Mainers overheard them, and offered to refloat the ship for almost nothing. The Japanese were very surprised, but decided that considering the situation they had nothing to lose.

So the mainers got 4 huge bulldozers, moved them out in barges near the ship during low tide, attached hawsers, and refloated the ship into deep water, simply by pulling the hawsers, moving back, reattaching them and pulling again. They may have had to stop several times when the tide came back in. Incidentally this is not far from Ted and The Bay of Fundy, so tides considerably greater there than elswhere.

I wish I were there to see the ingenious, creative Mainers refloat that ship. I doubt they would ever have had a confrontational conversation with a lighthouse on the coast of Maine unless they were pie-eyed! Makes you think twice about what kinds of leaders we must have in the US Navy these days.

Their home page is at

http://home.istar.ca/~inpath/

long term Toronto PM Index chart

http://home.istar.ca/~inpath/gold.gif

short term Toronto PM Index chart

http://home.istar.ca/~inpath/gold-cl.gif

http://home.istar.ca/~inpath/gold-cl.gif

So -- we should all be on the alert for the beginning of the gold bug Tsunami -- probably a small one to 350-400/oz in the next 12 months. This could corellate with a doubling of precious metals equities. Nimble gold bugs will not get squashed as long as they remember to get off before the market crashes. As Mike Sheller has reminded us this AM, one clue may be a sudden rise in interest rates. Those who like less risky things can buy gold or silver, and still make a profit.

I feel like the sailor who is becalmed without a whiff of wind or a ripple on the water. Gets pretty boring.

My intuitive guess is that a tug of war should start between the gold shorts and longs fairly soon. Maybe the big guys are waiting for a signal from the IMF G7 meeting, or from Japan.

Holy DOW vs. Beanie Babies? My guess is the DOW collapses first, although I can't convince my dear but daffy wife to unload hers ( I have tried ) . She's up about 500% SINCE OCTOBER ( seriously ) on these silly things.

Manias never make any sense to the outsiders.

OutsidersRus.

http://cbs.marketwatch.com/data/dbcfiles/indext.htx?source=htx/http2_mw

Happy trading!

I'm tired of watching the paint dry on our gold bull. Silver is much livelier.

But -- now that Kitco calm has returned, how about letting us know what the floor traders are doing with gold. My guess is that gold is heading down for a time -- as I think you said -- maybe 290, or 300. New lows are out of the question unless there is a total market meltdown, and AG et al throw in the kitchen sink. Unlikely.

I am still waiting for a sign that we are heading for that rise to 600/oz that Frank Veneroso predicted -- even 350 would be nice. But it is like watching paint dry.

Sharefin: Do you know what the Oldman is saying these days about gold and the markets?

Oh, well........Think there will be ANY trees standing in this forest after the clear-cutting is finished?

bbl

-- following up on last night's thread ( tolerant1, Lock'n Load, 223, et al. )

In an employee-controlled government ( ie. a modern democracy ) , employees seldom have incentives to either reduce the costs of government or the price charged to their customers ( tax payers ) . Where conditions impose strong price resistance, in the form of opposition to higher taxes, governments controlled by employees are more likely to let their revenues fall below their outlays than to cut their outlays -- that is, their incentives incline toward chronic deficits.

The easiest way ( for government ) to get permission to invest funds in activities with little or no direct financial return is to ask for permission from someone other than the person whose money is coveted ( cf. the Dutch buying Manhattan for $23 in beads from Indians who did not own the property ) . Think about it: What if you went into a furniture store to buy a sofa and the salesperson took your money then proceeded to foist a cheap coffee table at you while consulting other salespersons about the rightness of such a transaction? Ridiculous, no?

No. However, since there are not enough employees put on the ( government ) payroll to create a working majority, increasing numbers of voters are *effectively* put on the payroll. Recipients of transfer payments and subsidies become pseudogovernment employees able to dispense with the bothersome formality of reporting to work each day.

-----

Distilled from *The Sovereign Individual,* ch. 5, The Life and Death of the Nation-State, by Davidson & Rees-Mogg; Simon & Schuster, 1997, US$25.

Together, we can talk of this new gold market. In a day, or two, we will have much to discuss. I look forward to this.

The Kitco Co., it offers more to the world than a business, it provides a stage for minds to meet! This service is of much value to all, yes?

Thank You

Nikkei ends below 16,000 on yen's fall after G7

TOKYO, April 16 ( Reuters ) - Tokyo's main stock average lost more than 400 points to end below

the 16,000 mark on Thursday, as a fall in the yen after a meeting of Group of Seven ( G7 )

industrialised nations in Washington accelerated selling.

The key Nikkei average ended down 415.53 points, or 2.55 percent, at 15,883.77, while June

Nikkei futures ended down 500 at 15,850.

There were no other fresh factors to invite selling on Thursday, but investors also lacked incentives

to buy actively amid worries over the future course of the Japanese economy, brokers said.

They said some details of Japan's latest economic stimulus package were expected to be unveiled

next week, but that the forthcoming announcement had so far failed to completely erase investors'

worries over the economy.

Large and persistent sell orders at the 16,400 level in the futures market further dampened market

sentiment, they said. The sell orders had emerged repeatedly over recent sessions.

Initially, the statement issued by the G7 in Washington was not a major factor moving Tokyo stocks,

although it even relieved some investors in early morning as it said G7 members welcomed steps

taken by Japan to stimulate its economy, which would help to correct the excessive weakness of the

yen.

But the dollar climbed to above 131 yen in afternoon trade and the stock market mood quickly

deteriorated, brokers said.

``After the dollar rose above 131 yen, selling intensified,'' Tokyo Securities general manager

Kunihiro Hatae said.

``Without a correction in the yen's value, an overall rise in share prices will be unlikely,'' he said.

``We now see a strong link between the yen's weakness and stock falls,'' a trader at a foreign

brokerage said.

Investors are increasingly nervous about foreign exchange movements, viewing yen falls as a signal

for possible sales of yen-denominated assets by foreign investors, who have recently been major

players in Tokyo's stock market.

Brokers said light turnover magnified the impact of selling on the cash market on Thursday. Some

investors retreated to the sidelines to await details of the economic package and the futures sell

orders further diminished investors' interest in trading.

Turnover on the exchange's first section was 418 million shares, against 301 million shares on

Wednesday.

There was some buying in early morning trade by what was probably public funds, but such buying

weakened later due to persistent selling in the futures market, Daiwa Securities deputy general

manager Kenji Karikomi said.

Brokers said the futures sell orders were placed in connection with past buying. Some said they

were related to the use of public funds for massive shares buying at the end of March that was aimed

at lifting share prices, while others said the orders were placed by hedge funds.

The broad-based TOPIX index fell 24.11 points, or 1.94 percent, to 1,217.34. The Nikkei 300 fell

5.04 points, or 2.05 percent, to 240.69.

Declining issues outpaced advancing issues 939 to 207, with 110 issues unchanged. By sector,

losers were led by mining and oil. Shares of the air transport sector were bought.

Brokers expect the market to stay weak for some time.

``Selling by foreign investors may continue as they think Japan's upcoming economic package will

not be effective in boosting the economy,'' a trader at another foreign brokerage said.

``Institutional investors will be unwilling to move until the announcements of company earnings and

earnings outlooks as they want to invest in firms performing well,'' said Mamoru Otani, general

manager of Daiwa Securities.

Many Japanese companies plan to announce in May their earnings for the year that ended on March

31 as well as earnings forecasts for the current business year.

Some brokers forecast that Tokyo share prices would move nervously for some time in future,

affected by moves in the yen.

away...to eschew obfuscation

Éß

last scheduled email from Bart:

April 09, 1998 - London Fix Prices

AM Gold 308.35

PM Gold 307.65

and.....~~~~~~~~

April 14, 1998 - London Fix Prices

AM Gold 309.50

PM Gold 309.50

away...to eagerly await responses from our more seasoned plat traders and inside pooper-scoopers.....

Éß.dum.de.dum.ho.hum.

watch out gold

staring down

the bear... ( maul ) .

-------------------------------

'ello Orny Orni....from under....... ( from under what? ) ...well, from under your.......... ( whoops...ANOTHER joke....ANOTHER time/place )

away...for a while

Éß ( no ) ( ! ) .

---------------------------------

Grains settled higher on the Chicago Board of Trade Wednesday.

The soy and grain futures markets were supported by forecasts for

wet

weather in the U.S. and South America. Traders noted that

soybeans

don't do well in extreme rain. ( WSJ Interactive )

---------------------------------

away...to shuck & jive

Éßullorbeardon'tcare

I suspect that the Japanese are shaking their heads, looking at all of our debt, and the strength of our economy. Then they look at all of their savings, and the weakness of their economy. Part of the problem is that most of the Japanese are at retirement age, whereas our population will not peak retirement-wise until 2010-2015. We spend and the Japanese people don't.

I still find it amazing that their bubble burst in 1990 -- nearly 10 years ago. If that had happened here, our crash would have been much more dramatic, due to our lack of savings, and our less monlithic society.

I think we are repeating the cycle of 1929 where the US markets were the strongest, and the last to go. I think we are at least one year away from the final blowoff. Probably Sep-Oct 1999.

Nearly immediate effect on market:

1 ) Private debt meltdown -- bankruptcy rise

2 ) Failure of just in time -- already a bottleneck with some railroads

repeat of UPS strike?

3 ) AG raises interest rates -- unlikely -- too close to election time? World markets still too weak?

4 ) Dollar crisis -- probably unlikely at current time

5 ) Energy or commodities crisis

Delayed effect on market:

1 ) Federal collections deficit -- takes time to affect interest rates

2 ) SEAsia losses -- 1 trillion -- probably deferred into new debt instruments like 20 years ago. Will resurface as inflation years from now

3 ) US trade deficits, additions to national debt.

As the Oldman has said, it will take alot to bring this bull market down. Now -- if the Oldman was bearish, that would be a bad sign indeed! Oldman - comments? And RJ -- we miss your insight!

My point was that a private debt crisis due to explosive growth in bankrupty proceedings is more likely to crash the US markets well before the rise in interest rates causes a federal debt default. There is at least a 6 month lag time between personal bankruptcy and a federal receipts crisis. Hence ( chaos ) stability theory would suggest that private debt was more critical in destabilizing the US markets. I was reasoning that a US currency crisis -- given the strong US markets at the moment -- is less likely than a private credit meltdown.

My long term premise is that the US markets will continue to rally due to the baby boomers pouring money into their 401b's, economic savings/benefits from the information revolution which is predominantly in the US, 'flight to safety' from other markets, and a possible economic recovery in europe. My guess is that we will not have any real crises for the next several months, and possibly not till 2yk. That would be good for gold stocks, especially if Europe opens the currency flood gates.

Mozel: I agree with you that 'the powers that be' are quite capable of dumping gold to protect the US markets, as I suspect they did in October. I lost about 10k in two days when gold/gold stocks went down with the markets. I again pose the question 'what about the BIS?' That I think is the wild card, because I suspect they will set a lower limit to how low they will let gold go. I think the BIS is getting more clout again, and probably has something it can use to cause the US to back down from its anti-gold stance. Another threat to our fledgling gold bull is the Japanese meltdown I have brought up several times before. Unlikely, but could create a world financial crisis.

Incidentally, I have lost 1/2 of my gold stock profits in the last several days. Probably should have sold them, and waited to buy them back. But I am too much of an optimistic gold bug, I guess.

One measly dollar.