Don't the conductors, I mean the Rockefellers, have an expanse near Jackson Hole?

August 7, 1992 14358

July 3, 1995 14485

Near mid-session on August 27, 1998, the Nikkei stood at 14414.

This is getting right to the verge of ultimate meltdown.

I have a page up at The Privateer website showing the comparative moves on the Dow and the Nikkei since the BOJ/Fed joint intervention to rescue the Yen back on June 17 this year. What the charts there show clearly is the fact that the two indices have moved almost in lock step since then.

Both rallied in the aftermath of the intervention. Both rallies topped out ( the Dow at its 9337 all time high ) within one day of each other in mid July. Both have been falling since then.

The action on the Dow and Nikkei for the past ten weeks, and the action in Japan today, are ominous indeed for the Dow.

There is a link to the chart at the home page of The Privteer

Canada sets conditions for Quebec secession talks

 OTTAWA, Aug 26 ( Reuters ) - Quebec separatists might find themselves with only a fraction of their huge province if they decide to secede from Canada, the federal government has warned in the latest volley in its long-running verbal battle.

  The government's point man on keeping Canada united, Stephane Dion, sent a tightly reasoned letter to separatist Quebec Premier Lucien Bouchard late on Tuesday, laying out tough conditions for negotiations after an independence vote.

  The time for stratagems and 'winning' tricks is over, wrote Dion, a former university professor who is now intergovernmental affairs minister.

  Both the federalists and separatists have been furiously trying to spin the public's interpretation of last Thursday's pivotal Supreme Court decision, which said Quebec may not leave unilaterally but that Canada must negotiate if a clear majority votes on a clear question.

  Dion said any negotiations would raise the issue of the boundaries of Quebec, particularly those of the vast northern lands occupied primarily by Canadian natives.

  Nobody seriously suggests that our national existence, seamless in so many aspects, could be effortlessly separated along what are not the provincial boundaries of Quebec, Dion quoted from the court decision.

  One of the strategies of the federal government -- after the separatists' 1995 campaign which tried to show everything would be possible after a vote for independence -- has been to show the risks and uncertainties of they vote to leave Canada.

  It has warned before of the possibility of Quebec being divisible if Canada is, but was now able to draw on the Supreme Court for authority. Premier Bouchard reiterated, in a news conference on Friday, his position that Quebec is indivisible.

  Dion derided Bouchard's assertion that a clear majority means one vote more than 50 percent. He said the court used clear majority13 times and also spoke of a strong majority, substantial consensusand enhanced majority.

  In Quebec City, Quebec Intergovernmental Affairs Minister Jacques Brassard said a simple majority would be enough to allow the French-speaking province to separate.

  The three political parties in Quebec have an official common position that says that Quebecers can shape their destiny on the basis of the democratic rule of 50 percent plus one, he told reporters.

  Dion said Ottawa would never sit down to negotiations if the referendum asked something as vague as whether citizens of the mainly francophone province wanted sovereignty with an offer of political and economic partnershipwith Canada.

  That is the essence of the question voted on in October 1995, when the separatists won more than 49 percent of the vote.

  A clear question is an essential condition of a valid referendum in democracy, he said.

  The National Assembly ( Quebec's legislature ) is of course free to ask Quebeckers any questions it wants. But you will appreciate that the federal government, among others, cannot surrender its responsibility to evaluate the clarity of a question which would result in the break-up of a country.

Underneath the photo, it says:

' Peace cannot be kept by force.

It can only be achieved by understanding.'

A.A.

With that I head for home -- dinner is waiting. G'Evening all!

Well there is another colorful one and just as brilliant -- Nicolai Tesla -- but I don't know if he was considered a Physicist or an Engineer. Experimental physicists have something in common with the likes of him.

Another item I will never forget is the thousands of tornados that must have come with the storm -- because anything taller than about 50 feet was snapped off like it was a match stick. In a neighborhood shopping center, 6 1 1/2 foot-wide I beams for a sign were twisted all the way down to the ground -- like a pretzel. And -- after the storm it seemed like all the greenery of Charleston had been ripped off, and deposited in the streets during cleanup. Most side roads were effectively one way, due to the 20 foot piles of brush.

Hope the eye misses you, and your dont get 135 mph plus.

You touched a point that also occurred to me. And -- that is that the LBMA and the other bullion houses have probably played a fairly loose game with all the physical gold to get business. Also, imagine the feeding frenzy when the CB's announce they need brokers for hundreds of tonnes of gold they want to 'secretly' sell or loan. Further, the regulation of the LBMA seems to be self - generated. No outside inspectors. Little real regulation. So -- what happens one day when all that physical gold that everyone thought they had is not where they thought it was? Physical gold liquidity suddenly dries up and we have a sudden surge in the price of gold. We will probably have little warning of this since the 1000 + tonnes per day is probably not only physical gold -- but the volume of all gold transactions. Would be interesting to know how much physical gold the LBMA actually has -- and compare it to the trading volume. But -- we will never get that kind of information.

I think the bottom line is that since the LBMA seems to have little or no regulation from outside, it is at risk for a liquidity crisis such as what happened in the 70's when the CB's decided to stop selling gold. All we have to follow is COMEX stocks, in the hope that they will give us a clue to what is really happening behind the scenes in 'virtually unregulated' international metals markets.

What really amazes me, given what we know about the lack of regulation of the LBMA, is how it could have existed for over 200 years. Surely you would think that rules have developed over this time. But no -- COMEX seems to be more regulated than the LBMA. Of course, if the LBMA does get into trouble, it can just blame the bullion vendors as failing to come up with the claimed precious metal -- as it is just a clearing house. Now -- if shady practices are unearthed where gold is not there when the LBMA says it is, that is a different matter. In that case, perhaps all the gold trading just moves to Istanbul for a time.

By the way, do you know if the LBMA has been involved in scandals in the past, during its 200 plus year history? Might be illuminating.

levels even though the market has basically been in a tight trading range for almost 4 weeks. Commercials have a multi year high number of net long S&P contracts. After Fridays scare I'm sure they have an even larger number of long contracts.

The bond market is making record highs. The dollar is strong. The problem in Russia makes the US more attractive than Europe for the moment.

PM's are still punishing investors. Goldman Sachs is going public in November. Bill Clinton will do anything to save his diseased rear end.

This stock market looks like a setup to punish the shorts. The puts and non commercial S&P shorts are providing an oxegen rich mixture for a scary rally. It won't be over for the stock market until the PM's can rally. That will be a signal that the smart money is ready for the market to fall.

Be careful fellow goldbugs. Sentime

Well, just my greetings to you all and best wishes. Don't forget to do something to prepare for Y2K today! A little a day, like getting ready the kids' college funds. The only way to go. Sorry, often away from my machine lately. Hope to normalize soon.

Notes for today, would be headlines except so much other news.

My goodness. Saw a Donald report recently that Mexico's interest rates soared 20%. The Americas are the next hot spot. Currencies sliding, insurgencies cropping up in every country. Shouldn't this be headine news?

Latin and South American Bourses in severe bear market, threatening to freefall. Compared to their 52 week highs:

Brazil is down 48%; Chile down 38%, Mexico down 40%, Peru down 63%; Venequela down 70%.

These numbers are from Yahoo, and my understanding is that these are quoted in the local currency, without regard to any foreign exchange. So if you are in these markets but not in these countries, these losses are compounded by currency losses.

In the US, today's new 52 week lows were 581; new highs only 33. The BEAR Market is very much alive and actually expanding its base since my last post, a couple of weeks back.

Hang onto your hats, guys.

Namasté

I wonder -- didn't we have a commodity price collapse in the 20's, some years before the 1929 crash? Around 1925? Perhaps it is time to review that scenario again to get some insight into gold, and the markets. Certainly the US economy and markets were stimulated by dropping prices then also. Don't recall exactly what happened to the markets -- did they go down, and then skyrocket to oblivion? At that time, however, we did not have presidential problems such as the current ones.

I think I understand COMEX better after your post -- COMEX ( unlike LBMA ) does not require gold collateral, cash exchanges will do. However, I still have a serious problem with the LBMA, which I suspect is also doing what COMEX does -- and then some. Now -- certainly some of what the LBMA does is to act as a clearing house for physical gold -- e-gold -- as you put it. Probably some sort of 'scrip' is used for each ounce of gold in the transactions, so that the unweildy gold does not need to be moved around.

My problem is the LBMA is this. They claim that well over 1000 tonnes of gold is traded on the LBMA every day! Well, in two days that would be the entire World's production of gold.

So something is amiss --- the LBMA cannot possibly be exchanging this much e-gold. I'll bet that the LBMA is doing everything that COMEX is doing with gold speculation -- derivatives, gold carries, forwards, whatever. As well as the basic e-gold that the Rothschilds and their ilk might want. And, I doubt all the CB gold sales and gold loans are going through COMEX -- more likely the more anonymous international bullion houses.

Any idea how much gold and gold derivatives COMEX is trading daily? Does it come close to 1000+ tonnes per day ( on paper, at least ) ? Is it increasing or decreasing? There must be a reason why LBMA is boasting about the 1000 tonnes plus of gold traded daily. Perhaps they have an angle with the international speculators COMEX does not have. Perhap this has something to do with why Warren Buffett is trading silver on the european exchanges instead of on COMEX.

Our precious gold drops to $190 ( Armstrong @PIE ) before November 1999. You sell your gold for $190 + 3.3% ( $196.27 oz ) Multiplied by 100 coins = $19,627 and sell the Put for $280 - $190 ( $90. ) multiplied by 100 = $9,000. $19,627 + $9,000 = $28,627 return. Original investment of $30,414 - $28,627 = $1,787 loss or -6%.

How about $50.00 GOLD:

Sell the gold for 2000 shilling face value ( $160.00 oz ) Multiplied by 100 coins = $ 16,000 and sell the Put for $280 - $50 ( $230. ) multiplied by 100 = $23,000. $16,000 + $23,000 = $39,000 return. Original investment of $30,414 - $39,000 = $8,586 PROFIT or +28%.

Clinton is but a puppet. The ones standing behind him are the ones to

watch out for. IMO, of course.

Anyone wonder why Kenneth Starr is smiling like a Chesire cat these days, and WJC is in hiding? Perhaps Monica's credit card bill being reimbursed by the White House has something to do with it. Can you imagine the arrogance of that -- and he should know about the information revolution -- that such things as a credit card bill are practically public information. Looks like Big Brother is watching alright, but it is Big Brother himself who lost -- this time. Notice how the Democrats now want impeachment proceedings ( minority leader in House or Senate said that today -- IMHO ) , but the Republicans don't? I wonder why?

So -- I'll bet Kenneth Starr has enough WJC illegal activity for Congress to go forward with impeachment -- FBI files or no.

Any guess what the markets will do when this gets out? You can forget about Dow 10,000. Any 'flight to safety' will be neutralized by WJC's folding fortunes.

My only thoughts about now versus 1929 is that we are now net debtors. We do not have the cash cushion that held up the Japanese deflation for nearly 10 years. I don't have a clue regarding how quickly our tightly coupled, debt encumbered economy will fold up during a severe recession. If we have a debt implosion -- or a close call, the US dollar would tank, and gold bullion would rise.

My guess is that the scenario will resemble 1929 at first as our markets and economy spiral down. But -- if we reach a critical point of no return that not even AG can fix -- our monetary velocity will plummet. Then the US dollar will head south, with rising interest rates and rising gold bullion prices.

So -- my intuitive guess is that deflation will come first ( al la 1929 ) . But when our debt problems catch up with us, we are more likely to emulate Indonesia than the USA in 1929. When gold bullion starts to rise, we will be in very serious trouble indeed. Partially because it will mean that AG and RR have thrown in the towel.

It is still possible that we could squeak by this one, and make it to our next big crisis when the baby boomers retire. But -- I doubt it.

As I know from structural failure analysis -- the precise breaking point when the dollar collapses and gold skyrockets is unknowable -- too many unknowns. Just keep most of your powder dry, because the best part of the gold bug Tsunami will be after the US dollar tanks.

Notice Mexico is down another 5% today?

I just got off of the phone with a few contract agencies ( high tech temps and all... ) that I deal with, and to a word they all said the same thing, It's been awful quite out there, must be vacations during August, not many job reqs coming in. We expect more in September... I hope so. Fixing up, 'This Old House', is becoming a drag... GO GOLD AND OIL!!!!

BBML.

In Remembrance of Black Monday FREE Internet Stock Trades Otober 19, 1988.

Yes sir, indeedy, only in America................ :- ) )

indicates that they must move up before gold spot will move up.

BOYS AND GIRLS, IT'S A DEFLATION!

Alan Greenspan has said that the Fed's stance will not change as

long as the cycle of viruosity continues. I thought this meant

low inflation and rising markets, with stable interest rates.

It looks like what he meant was low inflation through a process of

ever cheaper ( deflated ) imports, and high relative interest rates

in the US to maintain the flood of foreign investment. Short term

prosperity in the USA will be at the expense of driving the world

into a depression. Those who are ignorant of history are doomed

to repeat the mistakes of history. Here we are in 1929 all over

again.